---

| | Suite 2300
      1177 West Hastings St. 
      St. Vancouver, BC 
      Canada V6E 2K3 | TEL 604.683.6332FAX 604.408.7499www.ithmines.com
      TSX: ITH| NYSE-A: THM
| | -------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------





ANNUAL INFORMATION FORMFOR THE FISCAL YEAR ENDED DECEMBER 31, 2011





March 16, 2012

---

ITEM 2 - TABLE OF CONTENTS

PagePRELIMINARY NOTES
      - 1 -Documents Incorporated by Reference
      - 1 -Date of Information
      - 1 -Currency and Exchange Rates
      - 1 -Metric Equivalents
      - 2 -Forward-Looking Statements
      - 2 -Caution Regarding Adjacent or Similar Mineral Properties
      - 5 -Caution Regarding Reference to Resources and Reserves
      - 5 -Glossary of Terms
      - 7 -ITEM 3:
      CORPORATE STRUCTURE
      - 14 -Name, Address and Incorporation
      - 14 -Intercorporate Relationships
      - 14 -ITEM 4:
      GENERAL DEVELOPMENT OF THE BUSINESS
      - 15 -Three Year History
      - 15 -ITEM 5:
      NARRATIVE DESCRIPTION OF THE BUSINESS
      - 16 -General
      - 16 -Risk Factors
      - 20 -Material Mineral Projects
      - 27 -ITEM 6:
      DIVIDENDS
      - 44 -ITEM 7:
      DESCRIPTION OF CAPITAL STRUCTURE
      - 44 -General Description of Capital Structure
      - 44 -Shareholders Rights Plan
      - 44 -Constraints
      - 44 -ITEM 8:
      MARKET FOR SECURITIES
      - 45 -Trading Price and Volume
      - 45 -ITEM 9:
      ESCROWED SECURITIES
      - 45 -ITEM 10:
      DIRECTORS AND EXECUTIVE OFFICERS
      - 45 -Name, Occupation and Security Holding
      - 45 -Cease Trade Orders, Bankruptcies, Penalties or Sanctions
      - 49 -Conflicts of Interest
      - 50 -ITEM 11:
      PROMOTERS
      - 50 -ITEM 12:
      LEGAL PROCEEDINGS AND REGULATORY ACTIONS
      - 50 -Legal Proceedings
      - 50 -Regulatory Actions
      - 50 -ITEM 13:
      INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS
      - 50 -ITEM 14:
      TRANSFER AGENT AND REGISTRAR
      - 51 -


i

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TABLE OF CONTENTS (continued)

PageITEM 15:
      MATERIAL CONTRACTS
      - 52 -ITEM 16:
      NAMES AND INTERESTS OF EXPERTS
      - 52 -Names and Interests of Experts
      - 52 -ITEM 17:
      ADDITIONAL INFORMATION
      - 53 -Audit Committee Information
      - 53 -Additional Information
      - 53 -SCHEDULE A  AUDIT COMMITTEE INFORMATION


ii

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PRELIMINARY NOTES

Documents Incorporated by Reference

Incorporated by
reference into this Annual Information Form (AIF) are the following documents:

| | (a) | Consolidated Audited Financial Statements of the Company
      for the seven month period ended December 31, 2011 and for the year ended
      May 31, 2011 (Financial Statements);                                                                                                                                                          
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                
| | (b) | Management Discussion and Analysis of the Company for the
      seven month period ended December 31, 2011 dated March 16, 2012
      (MD&A);                                                                                                                                                                                                
| |     |                                                                                                                                                                                                                                                                                                                                                
| | (c) | Management Information Circular dated October 13, 2011 in
      respect of the 2011 Annual General Meeting (2011 Information
      Circular);                                                                                                                                                                                                
| |     |                                                                                                                                                                                                                                                                                                                                                
| | (d) | Management Information Circular dated July 9, 2010 in
      respect of a special general meeting of the shareholders of the Company
      held on August 12, 2010 (July 2010 Information Circular); and                                                                                                                                      
| |     |                                                                                                                                                                                                                                                                                                                                                
| | (e) | Technical report dated August 25, 2011 entitled August
      2011 Summary Report on the Livengood Project, Tolovana District, Alaska
      by Carl E. Brechtel (PE, SME), Tim Carew (P.Geo, MIMMM), Russell Myers
      (CPG), William Pennstrom Jr. (QPMMSA, SME), Chris Puchner (CPG) and Scott
      Wilson (CPG) (the Livengood Report)

copies of each of which may be obtained online from SEDAR at
www.sedar.com.

Any statement contained in a document incorporated
or deemed to be incorporated by reference herein shall be deemed to be modified
or superseded for the purposes of this AIF to the extent that a statement
contained in this AIF or in any subsequently filed document that also is or is
deemed to be incorporated by reference herein modifies or supersedes such
statement. Any statement so modified or superseded shall not constitute a part
of this AIF, except as so modified or superseded. The modifying or superseding
statement need not state that it has modified or superseded a prior statement or
include any other information set forth in the document that it modifies or
supersedes.

The making of such a modifying or superseding statement
shall not be deemed an admission for any purpose that the modified or superseded
statement, when made, constituted a misrepresentation, an untrue statement of a
material fact or an omission to state a material fact that is required to be
stated or that is necessary to make a statement not misleading in light of the
circumstances in which it was made.

All financial information in this AIF is prepared in
accordance with International Financial Reporting Standards.

Date of Information

All information in this AIF is as of December 31, 2011 unless otherwise
indicated.

Currency and Exchange Rates

All dollar amounts in this AIF are expressed in
Canadian dollars unless otherwise indicated. The Companys accounts are
maintained in Canadian dollars and the Companys financial statements are
prepared in accordance with International Financial Reporting Standards. All
references to U.S. dollars, USD or to US$ are to United States dollars.

The following table sets forth the rate of exchange for the Canadian
dollar, expressed in United States dollars in effect at the end of the periods
indicated, the average of exchange rates in effect on the last day of each month
during such periods, and the high and low exchange rates during such periods
based on the noon rate of exchange as reported by the Bank of
Canada for conversion of Canadian dollars into United States dollars.

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- 2 -

Seven Month Period Ended December 31and Years Ended May 31Canadian Dollars to U.S. Dollars
      December 31,
      May 31,
      May 31,2011
      2011
      2010Rate at end of period
      0.9833
      1.0322
      0.9558Average rate for period
      1.0058
      1.0064
      0.9405High for period
      1.0484
      1.0582
      1.0039Low for period
      0.9626
      0.9365
      0.8580


Metric Equivalents

For
ease of reference, the following factors for converting Imperial measurements
into metric equivalents are provided:

To convert from Imperial
    To metric
    Multiply byAcres
    Hectares
    0.404686Feet
    Metres
    0.30480Miles
    Kilometres
    1.609344Tons
    Tonnes
    0.907185Ounces (troy)/ton
    Grams/Tonne
    34.2857


| | 1 mile = 1.609 kilometres                | 2000 pounds (1 short ton) =
      0.907 tonnes
| | ---------------------------------------- | ----------------------------------------------
| | 1 acre = 0.405 hectares                  | 1 ounce (troy) = 31.103 grams                 
| | 2,204.62 pounds = 1 metric ton = 1 tonne | 1 ounce (troy)/ton = 34.2857
      grams/tonne

Terms
used and not defined in this AIF that are defined in National Instrument 51-102
Continuous Disclosure Obligations shall bear that definition. Other
definitions are set out in National Instrument 14-101 Definitions.

**Forward-Looking Statements**

This
AIF contains forward-looking statements and forward-looking information
(collectively, forward-looking statements) within the meaning of applicable
Canadian and US securities legislation. These statements relate to future events
or the future activities or performance of the Company. All statements, other
than statements of historical fact are forward-looking statements. Information
concerning mineral resource estimates and the preliminary economic analysis
thereof also may be deemed to be forward-looking statements in that it reflects
a prediction of the mineralization that would be encountered, and the results of
mining it, if a mineral deposit were developed and mined. Forward-looking
statements are typically identified by words such as: believe, expect,
anticipate, intend, estimate, postulate, plans and similar expressions, or which by their
nature refer to future events. These forward looking statements include, but are
not limited to, statements concerning:

---

- 3 -

- the Companys strategies and objectives, both generally and specifically in
  respect of the Livengood project;
- the potential for the expansion of the estimated resources at the Livengood
  project;
- the potential for a production decision concerning, and any production at,
  the Livengood project;
- the completion of a Pre-feasibility Study for the Livengood project;
- the potential for higher grade mineralization to form the basis for a
  starter surface mine in any production scenario at the Livengood project;
- the potential overburden geometry of the Livengood deposit being amenable
  for low cost surface mining that could support a high production rate and
  economies of scale;
- the potential for cost savings due to the high gravity gold concentration
  component of some of the Livengood mineralization;
- the sequence of decisions regarding the timing and costs of development
  programs with respect to, and the issuance of the necessary permits and
  authorizations required for the Livengood project;
- the Companys estimates of the quality and quantity of the resources at the
  Livengood project;
- the timing and cost of the planned future exploration programs at the
  Livengood project, and the timing of the receipt of results therefrom;
- the Companys future cash requirements;
- general business and economic conditions;
- the Companys ability to meet its financial obligations as they come due,
  and to be able to raise the necessary funds to continue operations on
  acceptable terms, if at all;
- the results of the Preliminary Economic Assessment as described under
  Narrative Description of the Business  Material Mineral projects  Livengood
  Project, Alaska;
- the use of Proceeds from the financing which closed November 10, 2010; and
- the ability of the Company to continue to refine the project economics for
  the Livengood project, including by increasing proposed production and
  shortening the proposed mine life; and
- the potential for the production of placer gold, whether near-term or at
  all, on certain placer mining claims acquired in December 2011.

Although
the Company believes that such statements are reasonable, it can give no
assurance that such expectations will prove to be correct. Inherent in forward
looking statements are risks and uncertainties beyond the Companys ability to predict or
control, including, but not limited to, risks related to the Companys inability
to identify one or more economic deposits on its properties, variations in the
nature, quality and quantity of any mineral deposits that may be located,
variations in the market price of any mineral products the Company may produce
or plan to produce, the Companys inability to obtain any necessary permits,
consents or authorizations required for its activities, to produce minerals from
its properties successfully or profitably, to continue its projected growth, to
raise the necessary capital or to be fully able to implement its business
strategies, and other risks identified herein under Risk Factors.

---

- 4 -

The
Company cautions investors that any forward-looking statements by the Company
are not guarantees of future performance, and that actual results are likely to
differ, and may differ materially, from those expressed or implied by forward
looking statements contained in this AIF. Such statements are based on a number
of assumptions which may prove incorrect, including, but not limited to,
assumptions about:

- the demand for, and level and volatility of the price of, gold;
- general business and economic conditions;
- the timing of the receipt of regulatory and governmental approvals, permits
  and authorizations necessary to implement and carry on the Companys planned
  exploration and potential development program at the Livengood project;
- conditions in the financial markets generally;
- the Companys ability to secure the necessary consulting, drilling and
  related services and supplies on favourable terms in connection with not only
  its ongoing exploration program at Livengood but also in connection with the
  completion of its pre-feasibility study and in connection with any feasibility
  study that may be commissioned;
- the Companys ability to attract and retain key staff, particularly in
  connection with the carrying out of a feasibility study and the development of
  any mine at Livengood;
- the accuracy of the Companys resource estimates (including with respect to
  size and grade) and the geological, operational and price assumptions on which
  these are based;
- the timing of the ability to commence and complete the planned work at
  Livengood;
- the anticipated terms of the consents, permits and authorizations necessary
  to carry out the planned exploration and development programs at Livengood and
  the Companys ability to comply with such terms on a safe and cost-effective
  basis;
- the ongoing relations of the Company with its underlying lessors and the
  applicable regulatory agencies;
- that the metallurgy and recovery characteristics of samples from certain of
  the Companys mineral properties are reflective of the deposit as a whole;

---

- 5 -

- the continued development of and potential construction of any mine at the
  Livengood property not requiring consents, approvals, authorizations or
  permits that are materially different from those identified to date by the
  Company;
- the ability of the Company to predict how the net proceeds of the financing
  which closed on November 10, 2010 will be used; and
- the timetables for the completion of a pre-feasibility study at Livengood
  and for any feasibility study that may be commissioned.

In
addition, in carrying out the Preliminary Economic Assessment with respect to
the Livengood project, as described under Narrative Description of the Business
- Material Mineral Properties  Livengood Project, Alaska a number of
assumptions have been made, which are more particularly described in that
section.

These
forward looking statements are made as of the date hereof and the Company does
not intend and does not assume any obligation, to update these forward looking
statements, except as required by applicable law. For the reasons set forth
above, investors should not attribute undue certainty to or place undue reliance
on forward-looking statements.

Historical
results of operations and trends that may be inferred from the following
discussion and analysis may not necessarily indicate future results from
operations. In particular, the current state of the global securities markets
may cause significant reductions in the price of the Companys securities and
render it difficult or impossible for the Company to raise the funds necessary
to continue operations. See Risk Factors  Insufficient Financial
Resources/Share Price Volatility.

Caution Regarding Adjacent or Similar Mineral Properties

This
AIF contains information with respect to adjacent or similar mineral properties
in respect of which the Company has no interest or rights to explore or mine.
The Company advises US investors that the mining guidelines of the US Securities
and Exchange Commission (the SEC) set forth in the SECs Industry Guide 7
(SEC Industry Guide 7) strictly prohibit information of this type in documents
filed with the SEC. As a foreign private issuer preparing this AIF pursuant to
Canadian disclosure requirements under the Canada-U.S. Multi-Jurisdictional
Disclosure System, this AIF is not subject to the requirements of SEC Industry
Guide 7. Readers are cautioned that the Company has no interest in or right to
acquire any interest in any such properties, and that mineral deposits on
adjacent or similar properties are not indicative of mineral deposits on the
Companys properties.

Caution Regarding Reference to Resources and Reserves

The
terms mineral reserve, proven mineral reserve and probable mineral reserve
are Canadian mining terms as defined in accordance with Canadian National
Instrument 43-101  Standards of Disclosure for Mineral Projects (NI 43-101)
and the Canadian Institute of Mining, Metallurgy and Petroleum (the CIM) - CIM
Definition Standards on Mineral Resources and Mineral Reserves, adopted by the
CIM Council, as amended (CIM Standards). These definitions differ from the
definitions in SEC Industry Guide 7 under the United States Securities Act of
1933, as amended (the Securities Act). Under SEC Industry Guide 7 standards, a
final or bankable feasibility study is required to report reserves, the
three-year historical average price is used in any reserve or cash flow analysis
to designate reserves and the primary environmental analysis or report must be
filed with the appropriate governmental authority.

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- 6 -

In
addition, the terms mineral resource, measured mineral resource, indicated
mineral resource and inferred mineral resource are defined in and required to
be disclosed by NI 43-101 and the CIM Standards; however, these terms are not
defined terms under SEC Industry Guide 7 and are normally not permitted to be
used in reports and registration statements filed with the SEC. Investors are
cautioned not to assume that any part or all of mineral deposits in these
categories will ever be converted into reserves. Inferred mineral resources
have a great amount of uncertainty as to their existence, and great uncertainty
as to their economic and legal feasibility. It cannot be assumed that all or any
part of an inferred mineral resource will ever be upgraded to a higher category.
Under Canadian rules, estimates of inferred mineral resources may not form the
basis of feasibility or pre-feasibility studies, except in rare cases. Investors
are cautioned not to assume that all or any part of an inferred mineral resource
exists or is economically or legally mineable. Disclosure of contained ounces
in a resource is permitted disclosure under Canadian regulations; however, the
SEC normally only permits issuers to report mineralization that does not
constitute reserves by SEC Industry Guide 7 standards as in place tonnage and
grade without reference to unit measures.

Accordingly,
information contained in this AIF and the documents incorporated by reference
herein contain descriptions of the Companys mineral deposits that may not be
comparable to similar information made public by U.S. companies subject to the
reporting and disclosure requirements under the United States federal securities
laws and the rules and regulations thereunder.

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- 7 -

Glossary of Terms

The following is a glossary of certain mining terms used in this Annual
Information Form.

|adit        | A passage driven horizontally into a mountainside
      providing access to a mineral deposit from the surface of the working of a
  mine                                                                                      
|------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|              |                                                                                                                                                                                                                                
|Ag          | Silver                                                                                                                                                                                                                         
|              |                                                                                                                                                                                                                                
|alteration  | Changes in the chemical or mineralogical composition of a
      rock, generally produced by weathering or hydrothermal solutions                                                                                               
|              |                                                                                                                                                                                                                                
|anomalous   | Departing from the expected or normal                                                                                                                                                                                          
|              |                                                                                                                                                                                                                                
|anomaly     | A geological feature, especially in the subsurface,
      distinguished by geological, geophysical or geochemical means, which is
      different from the general surroundings and is often of potential economic
  value     
|              |                                                                                                                                                                                                                                
|As          | Arsenic                                                                                                                                                                                                                        
|              |                                                                                                                                                                                                                                
|Au          | Gold                                                                                                                                                                                                                           
|              |                                                                                                                                                                                                                                
|basalt      | A dark coloured igneous rock, commonly extrusive  the
  fine grained equivalent of gabbro                                                                                                                                     
|              |                                                                                                                                                                                                                                
|batholith   | A large, generally discordant plutonic mass that has more
      than 100 square kilometres of surface exposure and no known floor                                                                                              
|              |                                                                                                                                                                                                                                
|biotite     | A common rock forming mineral of the mica group                                                                                                                                                                                
|              |                                                                                                                                                                                                                                
|Board       | The board of directors of ITH                                                                                                                                                                                                  
|              |                                                                                                                                                                                                                                
|breccia     | Angular broken rock fragments held together by a mineral
  cement or a fine- grained matrix                                                                                                                                    
|              |                                                                                                                                                                                                                                
|BCBCA       | Business Corporations Act(British Columbia),
  ITHs governing statute                                                                                                                                                         
|              |                                                                                                                                                                                                                                
|chert       | A hard, dense microcrystalline or cryptocrystalline
      sedimentary rock, consisting chiefly of interlocking crystals of quartz
  less than about 30 microns in diameter                                                     
|              |                                                                                                                                                                                                                                
|chip sample | A series of small pieces of ore or rock taken at regular
  intervals across a vein or exposure                                                                                                                                 
|              |                                                                                                                                                                                                                                
|CIP         | Carbon-in-pulp - a method of recovering gold and silver
      from pregnant cyanide solutions by adsorbing the precious metals to
      granules of activated carbon, which are typically ground up coconut
  shells.        
|              |                                                                                                                                                                                                                                
|clastic     | Pertaining to a rock or sediment composed principally of
      fragments derived from pre-existing rocks or minerals and transported some
      distance from their places of origin; also said of the texture of such a
  rock
|              |                                                                                                                                                                                                                                
|cm          | Centimetres                                                                                                                                                                                                                    

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- 8 -

|Common Shares | The common shares without par value in the capital stock
  of ITH as the same are constituted on the date hereof                                                                                                                                                                                                                                                                                                                                          
|--------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|conglomerate  | A coarse grained clastic sedimentary rock, composed of
      rounded to sub-angular fragments larger than 2mm in diameter set in a
      fine-grained matrix of sand or silt, and commonly cemented by calcium
  carbonate, iron oxide, silica or hardened clay                                                                                                                                                                                           
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|Corvus        | Corvus Gold Inc., a company subsisting under the laws of
      British Columbia which was spun off from the Company in August, 2010                                                                                                                                                                                                                                                                                                                       
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|cutoff grade  | The lowest grade of mineralized material that qualifies
      as ore in a given deposit, that is, material of the lowest assay value
  that is included in a resource/reserve estimate                                                                                                                                                                                                                                                                    
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|deformation   | A general term for the processes of folding, faulting,
      shearing, compression, or extension of rocks as a result of various earth
  forces                                                                                                                                                                                                                                                                                                           
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|deposit       | A mineralized body which has been physically delineated
      by sufficient drilling, trenching, and/or underground work, and found to
      contain a sufficient average grade of metal or metals to warrant further
      exploration and/or development expenditures. Such a deposit does not
      qualify as a commercially mineable ore body or as containing reserves or
      ore, unless final legal, technical and economic factors are resolved
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|diamond drill | A type of rotary drill in which the cutting is done by
      abrasion rather than percussion. The cutting bit is set with diamonds and
      is attached to the end of the long hollow rods through which water is
      pumped to the cutting face. The drill cuts a core of rock which is
      recovered in long cylindrical sections, an inch or more in diameter                                                                                     
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|dip           | The angle that a stratum or any planar feature makes with
      the horizontal, measured perpendicular to the strike and in the vertical
  plane                                                                                                                                                                                                                                                                                                          
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|dike          | A tabular body of igneous rock that cuts across the
  structure of adjacent rocks or cuts massive rocks                                                                                                                                                                                                                                                                                                                                                   
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|Director      | A member of the Board of Directors of ITH                                                                                                                                                                                                                                                                                                                                                                                                                 
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|disseminated  | Fine particles of mineral dispersed throughout the
  enclosing rock                                                                                                                                                                                                                                                                                                                                                                                       
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|distal        | Said of an ore deposit formed at a considerable distance
      (e.g. tens of kilometres) from the volcanic source from which its
  constituents have been derived                                                                                                                                                                                                                                                                                         
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|drift         | A horizontal tunnel driven along or parallel to the
      strike of the orebody, for the extraction or exploration of minerals                                                                                                                                                                                                                                                                                                                            
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|epigenetic    | Said of a mineral deposit of origin later than that of
the enclosing rocks                                                                                                                                                                                                                                                                                                                                                                                

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- 9 -

|epithermal        | Said of a hydrothermal mineral deposit formed within
      about 1 kilometre of the earths surface and in the temperature range of
      50-200° C, occurring mainly as veins
|------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                    |                                                                                                                                                                               
|executive officer | When used in relation to any issuer (including the
      Company) means an individual who is:                                                                                 

(a)        a chair, vice chair or president;

(b)        a vice-president in charge of a
principal business unit, division or function, including sales, finance or
production; or

(c)        performing a policy-making
function in respect of the issuer

|exsolved     | Said of a substance that has undergone exsolution,
      being the process of the separation of an initially homogenous solution
      into at least two different crystalline minerals without the addition or
      removal of any materials  usually occurs upon cooling
|-------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|               |                                                                                                                                                                                                                                                                               
|felsic       | An igneous rock having abundant light coloured minerals,
      also, applied to those minerals (quartz, feldspars, feldspathoids,
      muscovite) as a group                                                                                                                 
|               |                                                                                                                                                                                                                                                                               
|footwall     | The mass of rock beneath a fault, orebody or mine
      working; especially the wall rock beneath an inclined vein or fault                                                                                                                                                   
|               |                                                                                                                                                                                                                                                                               
|g/t          | Grams per metric tonne                                                                                                                                                                                                                                                        
|               |                                                                                                                                                                                                                                                                               
|gabbro       | A group of dark coloured, basic intrusive igneous rocks 
      the approximate intrusive equivalent of basalt                                                                                                                                                                
|               |                                                                                                                                                                                                                                                                               
|gneiss       | A foliated rock formed by regional metamorphism, in which
      bands or lenticles of granular materials alternate with bands or lenticles
      of minerals with flaky or elongate prismatic habit  mineral composition
      is not an essential factor in its definition  
|               |                                                                                                                                                                                                                                                                               
|grab sample  | A sample composed of one or more pieces of rock,
      collected from a mineralized zone that, when analyzed, do not represent a
      particular width of mineralization nor necessarily the true mineral
      concentration of any larger portion of a mineralized zone    
|               |                                                                                                                                                                                                                                                                               
|grade        | To contain a particular quantity of ore or mineral,
      relative to other constituents, in a specified quantity of rock                                                                                                                                                     
|               |                                                                                                                                                                                                                                                                               
|hanging wall | The overlying side of an orebody, fault or mine working;
      especially the wall rock above an inclined vein or fault                                                                                                                                                       

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- 10 -

|heap leaching | A method of recovering minerals from ore whereby crushed
      rock is stacked on a non-porous liner and an appropriate chemical solution
      is sprayed on the top of the pile (the heap) and allowed to percolate
      down through the crushed rock, dissolving the desired minerals(s) as it
      does so. The chemical solution is then collected from the base of the heap
      and is treated to remove the dissolved mineral(s)
|--------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|host          | A rock or mineral that is older than rocks or minerals
      introduced into it or formed within it                                                                                                                                                                                                                                                                                                                                           
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|host rock     | A body of rock serving as a host for other rocks or for
      mineral deposits, or any rock in which ore deposits occur                                                                                                                                                                                                                                                                                                                       
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|hydrothermal  | A term pertaining to hot aqueous solutions of magmatic
      origin which may transport metals and minerals in solution                                                                                                                                                                                                                                                                                                                       
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|ITH           | International Tower Hill Mines Ltd., a company subsisting
      under the laws of British Columbia                                                                                                                                                                                                                                                                                                                                            
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|intrusion     | The process of the emplacement of magma in pre-existing
      rock, magmatic activity. Also, the igneous rock mass so formed                                                                                                                                                                                                                                                                                                                  
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|intrusive     | Of or pertaining to intrusion, both the process and the
      rock so formed                                                                                                                                                                                                                                                                                                                                                                  
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|km            | Kilometres                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|LPI           | Livengood Placers, Inc., a wholly owned subsidiary of
      Tower Alaska subsisting under the laws of Alaska                                                                                                                                                                                                                                                                                                                                  
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|m             | Metres                                                                                                                                                                                                                                                                                                                                                                                                                                        
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|mm            | Millimetres                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|mafic         | Said of an igneous rock composed chiefly of dark,
      ferromagnesian minerals, also, said of those minerals                                                                                                                                                                                                                                                                                                                                 
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|magma         | Naturally occurring molten rock material, generated
      within the earth and capable of intrusion and extrusion, from which
      igneous rocks have been derived through solidification and related
      processes                                                                                                                                                                                                                        
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|magmatic      | Of, or pertaining to, or derived from, magma                                                                                                                                                                                                                                                                                                                                                                                                  
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|massive       | Said of a mineral deposit, especially of sulphides,
      characterized by a great concentration of ore in one place, as opposed to
      a disseminated or veinlike deposit                                                                                                                                                                                                                                                                  
|                |                                                                                                                                                                                                                                                                                                                                                                                                                                               
|mesothermal   | Said of a hydrothermal mineral
      deposit formed at considerable depth and in the temperature range of 200 -
      300° Centigrade, also, said of that environment                                                                                                                                                                                                                                                                         

---

- 11 -

|metallogeny                                 | The study of the genesis of mineral deposits, with
      emphasis on their relationship in space and time to regional petrographic
      and tectonic features of the earths crust                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|--------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|Moz                                         | Million ounces                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|mineral reserve                             | The economically mineable part of a measured or indicated
      mineral resource demonstrated by at least a preliminary feasibility study.
      This study must include adequate information on mining, processing,
      metallurgical, economic and other relevant factors that demonstrate, at
      the time of reporting, that economic extraction can be justified. A
      mineral reserve includes diluting materials and allowances for losses that
      may occur when the material is mined and processed                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|mineral resource                            | A concentration or occurrence of natural, solid,
      inorganic or fossilized organic material in or on the Earths crust in
      such form and quantity and of such a grade or quality that it has
      reasonable prospects for economic extraction. The location, quantity,
      grade, geological characteristics and continuity of a mineral resource are
      known, estimated or interpreted from specific geological evidence and
      knowledge. The term mineral resource covers mineralization and natural
      material of intrinsic economic interest which has been identified and
      estimated through exploration and sampling and within which mineral
      reserves may subsequently be defined by the consideration and application
      of technical, economic, legal, environmental, socio-economic and
      governmental factors. The phrase reasonable prospects for economic
      extraction implies a judgement by a qualified person (as that term is
      defined in NI 43-101) in respect of the technical and economic factors
      likely to influence the prospect of economic extraction. A mineral
      resource is an inventory of mineralization that, under realistically
      assumed and justifiable technical and economic conditions, might become
      economically extractable
|                                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|mineralization                              | The concentration of metals and their chemical compounds
      within a body of rock                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|NationalInstrument 43-101/NI
      43-101 | National Instrument 43-101 of the Canadian Securities
      Administrators entitled Standards of Disclosure for Mineral Projects                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|NSR                                         | Net smelter return                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|NYSE-A                                      | NYSE Amex Equities (formerly, the American Stock
      Exchange)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|                                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|ophiolite                                   | An assemblage of mafic and ultramafic igneous rocks
      ranging from spilite and basalt to gabbro and peridotite, and always
      derived from them by later metamorphism, whose origin is associated with
      an early phase of the development of geosynclines                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                              |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|orogeny                                     | The process of natural mountain building, which may be
      studied as a tectonic structural event, as a geographical event and a
      chronological event, in that orogenic events cause distinctive structural
      phenomena and related tectonic activity, affect certain regions of rocks
      and crust and happen within a time frame                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

---

- 12 -

|outcrop                      | That portion of a geologic formation or structure that
      appears at the surface of the earth; also, bedrock that is covered by
      surficial deposits such as alluvium                                          
|------------------------------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                               |                                                                                                                                                                                                                       
|plunge                       | The inclination of a fold axis or other linear feature,
      measured in the vertical plane                                                                                                                          
|                               |                                                                                                                                                                                                                       
|PPB or ppb                 | Parts per billion                                                                                                                                                                                                     
|                               |                                                                                                                                                                                                                       
|PPM or ppm                  | Parts per million                                                                                                                                                                                                     
|                               |                                                                                                                                                                                                                       
|pyroclastic                  | Pertaining to clastic rock material formed by volcanic
      explosion or aerial expulsion from a volcanic vent; also, pertaining to
      rock texture of explosive origin                                           
|                               |                                                                                                                                                                                                                       
|quartzite                    | A granoblastic metamorphic rock consisting mainly of
      quartz, formed by recrystalization of sandstone by regional or thermal
      metamorphism                                                                  
|                               |                                                                                                                                                                                                                       
|relict texture               | In mineral deposits, an original texture that remains
      after total or partial replacement                                                                                                                        
|                               |                                                                                                                                                                                                                       
|reverse circulation drilling | A method of drilling whereby rock cuttings generated by
      the drill bit are flushed up from the bit face to the surface through the
      drill rods by air or drilling fluids for collection and analysis        
|                               |                                                                                                                                                                                                                       
|Sb                           | Antimony                                                                                                                                                                                                              
|                               |                                                                                                                                                                                                                       
|schist                       | A strongly foliated crystalline rock, formed by dynamic
      metamorphism, that has well developed parallelism of more than 50% of the
      minerals present                                                        
|                               |                                                                                                                                                                                                                       
|sedimentary                  | Pertaining to or containing sediment (typically, solid
      fragmental material transported and deposited by wind, water or ice that
      forms in layers in loose unconsolidated form), or formed by its deposition
|                               |                                                                                                                                                                                                                       
|shear zone                   | A tabular zone of rock that has been crushed and
      brecciated by many parallel fractures due to shear strain (often
      mineralized by ore-forming solutions)                                                   
|                               |                                                                                                                                                                                                                       
|silicification               | The introduction of, or replacement by, silica
      (especially in the form of fine- grained quartz, chalcedony or opal) which
      may fill pores and replace existing minerals (adj.: silicified)                 
|                               |                                                                                                                                                                                                                       
|sill                         | A tabular igneous intrusion that parallels the planar
      structure of the surrounding rock                                                                                                                         
|                               |                                                                                                                                                                                                                       
|stock                        | An igneous intrusion that is less than 100 square
      kilometres in surface exposure, is usually but not always discordant, and
      resembles a batholith except in size                                          
|                               |                                                                                                                                                                                                                       
|stockwork                    | A mineral deposit consisting of a three-dimensional
      network of irregular veinlets closely enough spaced that the whole mass
      can be mined                                                                  
|                               |                                                                                                                                                                                                                       
|strike                       | The direction taken by a structural surface                                                                                                                                                                           

---

- 13 -

|tabular        | Said of a feature having two dimensions that are much
      larger or longer than the third, or of a geomorphic feature having a flat
      surface, such as a plateau                                                
|---------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                 |                                                                                                                                                                                                                       
|tectonic       | Pertaining to the forces involved in, or the resulting
      structures of, tectonics                                                                                                                                 
|                 |                                                                                                                                                                                                                       
|tectonics      | A branch of geology dealing with the broad architecture
      of the outer part of the earth, that is, the major structural or
      deformational features and their relations, origin and historical
      evolution
|                 |                                                                                                                                                                                                                       
|terrane        | A term applied to a rock or group of rocks and to the
      area in which they crop out                                                                                                                               
|                 |                                                                                                                                                                                                                       
|Tower Alaska   | Tower Hill Mines, Inc. (formerly, Talon Gold Alaska,
      Inc.)., a wholly owned subsidiary of ITH subsisting under the laws of
      Alaska                                                                       
|                 |                                                                                                                                                                                                                       
|Tower Hill US  | Tower Hill Mines (US) LLC (formerly Talon Gold (US)
      LLC), a wholly owned subsidiary of Tower Alaska subsisting under the laws
      of Colorado                                                               
|                 |                                                                                                                                                                                                                       
|tuff           | A general term for all consolidated pyroclastic rocks                                                                                                                                                                 
|                 |                                                                                                                                                                                                                       
|thrust sheet   | The body of rock above a large-scale thrust fault whose
      surface is horizontal or very gently dipping                                                                                                            
|                 |                                                                                                                                                                                                                       
|TSX            | Toronto Stock Exchange                                                                                                                                                                                                
|                 |                                                                                                                                                                                                                       
|TSXV           | TSX Venture Exchange                                                                                                                                                                                                  
|                 |                                                                                                                                                                                                                       
|ultramafic     | Said of an igneous rock composed chiefly of mafic
      minerals                                                                                                                                                      
|                 |                                                                                                                                                                                                                       
|vein           | An epigenetic mineral filling of a fault or other
      fracture, in tabular or sheetlike form, often with the associated
      replacement of the host rock; also, a mineral deposit of this form and
      origin   
|                 |                                                                                                                                                                                                                       
|volcaniclastic | Pertaining to a clastic rock containing volcanic material
      in whatever proportion, and without regard to its origin or environment                                                                               

---

- 14 -

**ITEM 3:**      
**CORPORATE STRUCTURE**

Name, Address and Incorporation

ITH was incorporated under the
Company Act(British Columbia) under the name Ashnola
Mining Company Ltd. on May 26, 1978. ITHs name was changed to Tower Hill
Mines Ltd. on June 1, 1988, and subsequently changed to International Tower
Hill Mines Ltd. on March 15, 1991. ITH has been transitioned under, and is now
governed by, the BCBCA. On October 11, 2005, ITH filed a transition application
under the BCBCA, reflecting the adoption by the shareholders, on October 29,
2004, of a new form of Articles to govern the affairs of ITH in substitution for
the original articles adopted under the old Company Act(B.C.) and reflecting the increased flexibility available to companies under
the BCBCA. A copy of the new Articles is available on SEDAR at www.sedar.com. On
November 15, 2005, the shareholders resolved to amend the Articles to increase
the authorized capital from 20,000,000 common shares without par value to
500,000,000 common shares without par value. A Notice of Articles in respect of
such increase was filed on April 20, 2006, at which time such increase in
authorized capital became effective.

The head office and principal
business address of ITH is located at Suite 2300  1177 West Hastings Street,
Vancouver, British Columbia, CANADA V6E 2K3, and its registered and records
office is located at Suite 2300, Four Bentall Centre, 1055 Dunsmuir Street, P.O.
Box 49122, Vancouver, B.C. V7X 1J1.

**Intercorporate Relationships**

ITH has two material subsidiaries:

| | (a) | Tower Alaska, a corporation incorporated in
      Alaska on June 27, 2006, which holds all of the Companys Alaskan
      properties and is 100% owned by ITH; and                                   
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                      
| | (b) | Tower Hill US, a limited liability company
      formed in Colorado on June 27, 2006, which carries on all of the Companys
      mineral exploration operations and is wholly owned by Tower Alaska.

****      
  **The following corporate chart sets forth all of ITHs material
  subsidiaries:**



Throughout
this AIF references to the Company refer to ITH and its consolidated
subsidiaries, Tower Alaska and Tower Hill US. References to ITH refer to ITH
alone.

---

- 15 -

**ITEM
4:**       **GENERAL
DEVELOPMENT OF THE BUSINESS**

Three Year History

The
Company is a mineral exploration company engaged in the acquisition, exploration
and development of mineral properties. The Company currently holds or has the
right to acquire interests in an advanced stage exploration project in Alaska
referred to as the Livengood Project. The Company is in the exploration stage
as its property has not yet reached commercial production. All work presently
planned by the Company is directed at defining mineralization at the Livengood
project and increasing understanding of the characteristics of, and economics
of, that mineralization. While the Company has outlined estimated mineral
resources at the Livengood project, there are no mineral reserves on the
Livengood project.

Since
2006, the Company has focussed primarily on the acquisition and exploration of
mineral properties in Alaska and Nevada by acquiring by staking, purchase, lease
or option (primarily from AngloGold Ashanti (U.S.A.) Exploration Inc.
(AngloGold) in a transaction which closed on August 4, 2006) interests in a
number of mineral properties in Alaska (Livengood, Terra, LMS, BMP, Chisna,
Coffee Dome, West Tanana, Gilles, West Pogo, Caribou, Blackshell and South
Estelle) and Nevada (North Bullfrog and Painted Hills) that it believes have the
potential to host large precious or base metal deposits. Some of these, such as
the Painted Hills, Gilles, West Tanana, Caribou and Blackshell properties were,
in light of disappointing exploration results, dropped or returned to the
respective optionors or lessors, and the associated costs written off while
others, such as the South Estelle property, have been sold. Since early 2008,
the Companys primary focus has been the exploration and advancement of its
Livengood project in Alaska and the majority of its resources have been directed
to that end. To this end, in August 2010, ITH undertook a corporate spin-out
arrangement transaction whereby all of its mineral property interests other than
the Livengood property were transferred to Corvus and Corvus was spun out as an
independent and separate public company. Following the completion of such
transaction, the sole mineral property held by the Company is the Livengood
Project. Since the completion of such transaction, the Company has focussed
exclusively on the ongoing exploration and potential development of the
Livengood Project.

In
December 2011, the Company completed two acquisitions in connection with the
Livengood Project. The first acquisition consisted of the exercise of an
existing lease buyout option with respect to certain mining claims leased by the
Company, thereby giving the Company a 100% ownership interest. The second
acquisition was of certain placer mining claims and related rights in the
vicinity of the Livengood Project, and included all of the shares of LPI (which
corporation holds some of the subject placer mining claims). This land was
previously vacant or was used for placer gold mining. The acquisitions complete
a planned lease buyout and also enable the Company to pursue additional site
facility locations and to investigate other land use opportunities including the
potential for placer gold extraction.

All
of the Companys currently proposed exploration is under the jurisdiction of the
State of Alaska.

In
Alaska, low impact, initial stage surface exploration such as stream sediment,
soil and rock chip sampling do not require any permits. The State of Alaska
requires an APMA (Alaska Placer Mining Application) exploration permit for all
substantial surface disturbances such as trenching, road building and drilling.
These permits are also reviewed by related state and federal agencies that can
comment and require specific changes to the proposed work plans to minimize
impacts on the environment. The permitting process for significant disturbances
generally requires 30 days for processing and all work must be bonded. The
Company currently has all necessary permits with respect to its exploration
activities in Alaska. Although the Company has never had an issue with the
timely processing of APMA permits there can be no assurances that delays in
permit approval will not occur. Due to the northern climate, exploration work in
some areas of Alaska can be limited due to excessive snow cover and cold temperatures. In general, surface sampling work is limited to
May through September and surface drilling from March through November, although
some locations afford opportunities for year-round exploration operations and
others, such as wetland areas, may only be explored while frozen in the winter.
Mining is conducted in a number of locations in Alaska on a year-round basis,
both surface and underground.

---

- 16 -

Currently,
there are no environmental regulations in Alaska that impact the Company because
it is still in the exploration stage. Reclamation work, that is, work done to
restore the property to its original state, is minimal because the Companys
operations have virtually no environmental impact. The Companys required
remedial environmental reclamation work typically consists of slashing
underbrush so that wildlife movement is not hampered and basic re-seeding
operations.

Since June 1, 2011, being the commencement of the Companys last completed
fiscal year, the Company has not entered into any significant acquisitions for
which disclosure is required under Part 8 of National Instrument 51-102.

**ITEM
5:**       **NARRATIVE
DESCRIPTION OF THE BUSINESS**

**General**

***Summary***

The
Company currently holds, or has rights to acquire, ownership or leasehold
interests in a group of adjacent mineral properties located approximately 115
kilometres north of Fairbanks, Alaska and collectively referred to as the
Livengood Project (subject, in certain cases, to NSR royalties payable to the
original property vendors/lessors) in Alaska (Figure 1). The Company is in the
process of evaluating the Livengood project through advanced exploration
programs and the preparation of a pre-feasibility study, with the objective of
evaluating the potential of the project and determining if the preparation of a
full feasibility study is warranted. The progress on, and results of, work
programs on the Companys Livengood project (being its only mineral property) is
set out in the Mineral Projects section of this AIF.

The
Company is in the exploration stage and does not mine, produce or sell any
mineral products at this time. While the Livengood project has estimated mineral
resources, it does not at this time have any known or identified mineral
reserves. The Company does not propose any method of production at this time,
and one of the aims of the planned pre-feasibility study is to determine the
optimum method for any production at the Livengood project.

All
aspects of the Companys business require specialized skills and knowledge. Such
skills and knowledge include the areas of geology, drilling, logistical
planning, preparation of pre-feasibility and feasibility studies and the
construction and operation of a mine (following a production decision having
been made), financing and accounting. Since commencing its current operations in
mid-2006, the Company has found that it can locate and retain appropriate
employees and consultants and believes it will continue to be able to do so.

All
of the raw materials the Company requires to carry on its business are readily
available through normal supply or business contracting channels in Canada and
the United States. Since commencing current operations at the Livengood project
in mid-2006, the Company has been able to secure the appropriate personnel,
equipment and supplies required to conduct its contemplated programs. The recent
overall increase in the mineral exploration business has caused difficulty in
certain equipment and services being made available on a timely basis. The
Company has experienced difficulty in procuring some equipment  for example,
drill equipment  or services  for example, experienced drillers and timely
assay laboratory services. The Company will monitor and plan its activities
around any shortages of required personnel, equipment or supplies in the
foreseeable future.

The
mining business is subject to mineral price cycles. The marketability of
minerals and mineral concentrates is also affected by worldwide economic cycles.
At the present time, the significant demand for minerals in some countries (notably China) is driving
increased base metal commodity prices, and a fear of coming inflation and
economic uncertainly are driving higher gold prices, but it is difficult to
assess how long such demand may continue.

---

- 17 -

The
Companys business is not substantially dependent on any contract such as a
contract to sell the major part of its products or services or to purchase the
major part of its requirements for goods, services or raw materials, or on any
franchise or licence or other agreement to use a patent, formula, trade secret,
process or trade name upon which its business depends. Rather, the Companys
ability to continue making the holding, assessment, lease and option payments
necessary to maintain its interest in the Livengood project, to fund the ongoing
advanced exploration, and to raise the funding necessary to develop a mine at
Livengood following any production decision that may be made following the
completion of its planned feasibility study are of primary concern. The Company
does not presently anticipate any difficulties in this regard in the current
financial year.

It
is not expected that the Companys business will be affected in the current
financial year by the renegotiation or termination of contracts or
sub-contracts.

As
of March 16, 2012, ITH had one part-time employee and Tower Hill US and Tower
Alaska had 26 full-time employees. The Company also relies upon consultants and
contractors to carry on many of its activities and, in particular, to carry out
drilling programs at the Livengood project and in connection with the
preparation of its pre-feasibility and any feasibility studies on that project.
However, as ITH expands its activities, it may choose to hire additional
employees rather than relying on consultants.

******       ***Bankruptcy and Similar Procedures***

There
are no bankruptcy, receivership or similar proceedings against ITH, nor is ITH
aware of any such pending or threatened proceedings. There have not been any
voluntary bankruptcy, receivership or similar proceedings by ITH within the
three most recently completed financial years or completed or currently proposed
for the current financial year.

---

- 18 -



Figure 1: Location of the Livengood Project

Reorganizations

The
only reorganization of or involving ITH within the three most recently completed
financial years was the corporate spin-out transaction under which ITH
transferred all of its non-Livengood mineral property assets (including its
subsidiaries Raven Gold Alaska Inc. and Talon Gold Nevada Inc.) to Corvus by way
of a corporate arrangement and Corvus was spun-to to the shareholders of ITH as
an independent public company. The July 2010 Information Circular, which
provides information concerning the spin-out of Corvus by way of corporate
arrangement under the BCBCA, is specifically incorporated by reference herein,
and readers are referred to the July 2010 Information Circular for a complete
description of the spin-out transaction and details of each of the Company and
Corvus following the completion thereof.

The
spin-out transaction pursuant to the plan of arrangement among ITH, its
shareholders and Corvus (Plan of Arrangement) was approved by the shareholders
of ITH on August 12, 2010, and the final order of the Supreme Court of British
Columbia approving the Plan of Arrangement under the BCBCA to implement the
transaction was received on August 20, 2010. The effective date of the spin-out
transaction under the Plan of Arrangement was August 26, 2010 and the common
shares of Corvus commenced trading on the TSX on August 30, 2010. On the
effective date of the Arrangement, shareholders of ITH held one Common Share and
one-half of one common share of Corvus for each common share of ITH held
immediately prior to the effective date. Under the terms of the transaction, ITH
retained all assets relating to the Livengood gold project in Alaska, together
with approximately $33 million in working capital. Corvus received all of ITHs
other existing Alaska and Nevada assets, together with approximately $3.3
million in working capital.

---

- 19 -

As
proposed, following the completion of the spin-out, the Company has concentrated
on completing the ongoing pre-feasibility study and thereafter, assuming the
results of such study are as currently assumed, moving the Livengood project
towards feasibility and a potential production decision.

******       ***Social or Environmental Policies***

ITH
has created a Health, Occupational Safety and Environmental Committee (HOSEC)
of the Board, which has adopted a formal charter. The overall purpose of the
HOSEC is to assist the Board in fulfilling its oversight responsibilities with
respect to the Boards and the Companys continuing commitment to improving the
environment and ensuring that the Companys activities are carried out, and that
its facilities are operated and maintained, in a safe, sustainable and
environmentally sound manner. The primary function of the Committee is to
monitor, review and provide oversight with respect to the Companys policies,
standards, accountabilities and programs relative to health, safety, community
relations and environmental-related matters. Further, the HOSEC is to advise the
Board and make recommendations for the Boards consideration regarding health,
safety, community relations and environmental-related issues. In particular, the
HOSEC is to consider and advise the Board with respect to current standards of
sustainable development for projects and activities such as those of the
Company, particularly with a view to ensuring that the Companys business is run
in a manner, and its projects are operated and developed, so as to achieve the
ideals and reflect the following principles of sustainable development:

| | (a) | living within environmental limits,         
| | --- | --------------------------------------------
| | (b) | ensuring a strong, healthy and just society,
| | (c) | achieving a sustainable economy,            
| | (d) | using sound science responsibly, and        
| | (e) | promoting good governance.                  

The HOSEC is also responsible for monitoring the activities of
the Company in connection with the initial and ongoing interaction between the
Companys activities, operations and personnel and the communities in which the
Companys projects and related activities are located, with a view to ensuring
that management develops and follows appropriate policies and activities to
enhance the relationship between the Company and its personnel and the
communities in which it operates and reflect the principles of sustainable
development in that regard.

Although
not set out in a specific policy, the Company strives to be a positive influence
in the local communities where its mineral projects are located, not only by
contributing to the welfare of such communities through donations of money and
supplies, as appropriate, but also through hiring, when appropriate, local
workers to assist in ongoing exploration programs. The Company considers that
building and maintaining strong relationships with such communities is
fundamental to its ability to continue to operate in such regions and to assist
in the eventual development (if any) of mining operations in such regions, and
it attaches considerable importance to commencing and fostering them from the
beginning of its involvement in any particular area.

ITH
has also adopted a Code of Business Conduct and Ethics, which provides, among
other things, that ITH is committed to complying with all laws and governmental
regulations applicable to its activities and, specifically, to maintaining a
safe and healthy work environment and conducting its activities in full
compliance with all applicable environmental laws.

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Risk Factors

In
addition to those risk factors discussed elsewhere in this AIF, the Company is
subject to the following risk factors:

Resource
Exploration and Development is Generally a Speculative Business: Resource
exploration and development is a speculative business and involves a high degree
of risk, including, among other things, unprofitable efforts resulting both from
the failure to discover mineral deposits and from finding mineral deposits
which, though present, are insufficient in size and grade at the then prevailing
market conditions to return a profit from production. The marketability of
natural resources which may be acquired or discovered by the Company will be
affected by numerous factors beyond the control of the Company. These factors
include market fluctuations, the proximity and capacity of natural resource
markets, government regulations, including regulations relating to prices,
taxes, royalties, land use, importing and exporting of minerals and
environmental protection. The exact effect of these factors cannot be accurately
predicted, but the combination of these factors may result in the Company not
receiving an adequate return on invested capital.

While
the Livengood property has estimated measured, indicated and inferred resources
identified, there are no known reserves at the Livengood property. The majority
of exploration projects do not result in the discovery of commercially mineable
deposits of ore. Substantial expenditures are required to establish ore
reserves through drilling and metallurgical and other testing techniques,
determine metal content and metallurgical recovery processes to extract metal
from the ore, and construct, renovate or expand mining and processing
facilities. No assurance can be given that any level of recovery of ore reserves
will be realized or that any identified mineral deposit will ever qualify as a
commercial mineable ore body which can be legally and economically exploited.

Fluctuation
of Metal Prices: Even if commercial quantities of mineral deposits are
discovered by the Company, there is no guarantee that a profitable market will
exist for the sale of the metals produced. The Companys long-term viability and
profitability depend, in large part, upon the market price of metals which have
experienced significant movement over short periods of time, and are affected by
numerous factors beyond the control of the Company, including international
economic and political trends, expectations of inflation, currency exchange
fluctuations, interest rates and global or regional consumption patterns,
speculative activities and increased production due to improved mining and
production methods. The supply of and demand for metals are affected by various
factors, including political events, economic conditions and production costs in
major producing regions. There can be no assurance that the price of any
minerals produced from the Companys property will be such that any such
deposits can be mined at a profit.

Permits
and Licenses: The operations of the Company will require licenses and
permits from various governmental authorities. There can be no assurance that
the Company will be able to obtain all necessary licenses and permits that may
be required to carry out exploration, development and mining operations at the
Livengood project, on reasonable terms or at all. Delays or a failure to obtain
such licenses and permits or a failure to comply with the terms of any such
licenses and permits that the Company does obtain, will have a material adverse
effect on the Company.

Acquisition
of Mineral Claims under Agreements: The agreements pursuant to which the
Company holds or has the right to acquire interests in the individual properties
comprising the Livengood project provide that the Company must make a series of
cash payments over certain time periods and/or expend certain minimum amounts on
the exploration of the properties. Failure by the Company to make such payments
or make such expenditures in a timely fashion may result in the Company losing
its interest in such properties. There can be no assurance that the Company will
have, or be able to obtain, the necessary financial resources to be able to
maintain all of its property agreements in good standing, or to be able to
comply with all of its obligations thereunder, with the result that the Company
could forfeit its interest in one or more of its mineral properties.

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Proposed
Amendments to the United States General Mining Law of 1872: In recent years,
the United States Congress has considered a number of proposed amendments to the
U.S. General Mining Law of 1872 (Mining Law). If adopted, such
legislation, among other things, could impose royalties on mineral production
from unpatented mining claims located on United States federal lands, result in
the denial of permits to mine after the expenditure of significant funds for
exploration and development, reduce estimates of mineral reserves and reduce the
amount of future exploration and development activity on United States federal
lands, all of which could have a material and adverse affect on the Companys
cash flow, results of operations and financial condition.

Uncertainties
Relating to Unpatented Mining Claims:Certain of the Companys mineral
properties at Livengood comprise federal unpatented mining claims. There is a
risk that a portion of the Companys federal unpatented mining claims could be
determined to be invalid, in which case the Company could lose the right to mine
any minerals contained within those mining claims. Federal unpatented mining
claims are created and maintained in accordance with the Mining Law. Unpatented
mining claims are unique to United States property interests, and are generally
considered to be subject to greater title risk than other real property
interests due to the validity of unpatented mining claims often being uncertain.
This uncertainty arises, in part, out of the complex federal and state laws and
regulations under the Mining Law. Unpatented mining claims are always subject to
possible challenges of third parties or contests by the United States federal
government. The validity of an unpatented mining claim, in terms of both its
location and its maintenance, is dependent on strict compliance with a complex
body of federal and state statutory and decisional law. Title to the unpatented
mining claims may also be affected by undetected defects such as unregistered
agreements or transfers. The Company has not obtained full title opinions for
the majority of its mineral properties. Not all the mineral properties in which
the Company has an interest have been surveyed, and their actual extent and
location may be in doubt.

Surface
Rights and Access: Although the Company acquires the rights to some or all
of the minerals in the ground subject to the mineral tenures that it holds, or
has a right to acquire, in most cases it does not thereby acquire any rights to,
or ownership of, the surface to the areas covered by its mineral tenures. In
such cases, applicable mining laws usually provide for rights of access to the
surface for the purpose of carrying on mining activities, however, the
enforcement of such rights through the courts can be costly and time consuming.
It is necessary to negotiate surface access or to purchase the surface rights if
long-term access is required. There can be no guarantee that, despite having the
right at law to access the surface and carry on mining activities, the Company
will be able to negotiate satisfactory agreements with any such existing
landowners/occupiers for such access or purchase of such surface rights, and
therefore it may be unable to carry out planned mining activities. In addition,
in circumstances where such access is denied, or no agreement can be reached,
the Company may need to rely on the assistance of local officials or the courts
in such jurisdiction the outcomes of which cannot be predicted with any
certainty. The inability of the Company to secure surface access or purchase
required surface rights could materially and adversely affect the timing, cost
or overall ability of the Company to develop any mineral deposit at the
Livengood project.

No
Assurance of Profitability: The Company has no history of production or
earnings and due to the nature of its business there can be no assurance that
the Company will be profitable. The Company has not paid dividends on its shares
since incorporation and does not anticipate doing so in the foreseeable future.
The Livengood property is still in the advanced exploration stage and the
Company has not defined or delineated any proven or probable reserves at
Livengood. No feasibility study has yet been completed, and no production
decision has been made, in respect of the Livengood property. Continued
exploration of the Livengood project and the future development of that property
following any production decision that may be made, will require significant
funds. The only present source of funds available to the Company is through the
sale of its equity shares. Even if the results of exploration are encouraging,
the Company may not have sufficient funds to conduct the further exploration
that may be necessary to determine whether or not a commercially mineable
deposit exists. While the Company may generate additional working capital
through further equity offerings, there is no assurance that any such funds will
be available on favourable terms, or at all. At present, it is impossible to
determine what amounts of additional funds, if any, may be required. Failure to
raise such additional capital could put the continued viability of the Company
at risk.

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Uninsured
or Uninsurable Risks: Exploration, development and mining operations involve
various hazards, including environmental hazards, industrial accidents,
metallurgical and other processing problems, unusual or unexpected rock
formations, structural cave-ins or slides, flooding, fires, metal losses and
periodic interruptions due to inclement or hazardous weather conditions. These
risks could result in damage to or destruction of mineral properties, facilities
or other property, personal injury, environmental damage, delays in operations,
increased cost of operations, monetary losses and possible legal liability. The
Company may not be able to obtain insurance to cover these risks at economically
feasible premiums or at all. The Company may elect not to insure where premium
costs are disproportionate to the Companys perception of the relevant risks.
The payment of such insurance premiums and of such liabilities would reduce the
funds available for exploration and production activities.

Government
Regulation: Any exploration, development or mining operations carried on by
the Company will be subject to government legislation, policies and controls
relating to prospecting, development, production, environmental protection,
mining taxes and labour standards. The Company cannot predict whether or not
such legislation, policies or controls, as presently in effect, will remain so,
and any changes therein (for example, significant new royalties or taxes), which
are completely outside the control of the Company, may materially adversely
affect to ability of the Company to continue its planned business within any
such jurisdictions.

Market
  events and conditions:Since 2008, the U.S. credit markets have experienced
  serious disruption due to a deterioration in residential property values, defaults
  and delinquencies in the residential mortgage market (particularly, sub-prime
  and non-prime mortgages) and a decline in the credit quality of mortgage backed
  securities. These problems have led to a slow-down in residential housing market
  transactions, declining housing prices, delinquencies in non-mortgage consumer
  credit and a general decline in consumer confidence. These conditions caused
  a loss of confidence in the broader U.S. and global credit and financial markets
  and resulting in the collapse of, and government intervention in, major banks,
  financial institutions and insurers and creating a climate of greater volatility,
  less liquidity, widening of credit spreads, a lack of price transparency, increased
  credit losses and tighter credit conditions. Notwithstanding various actions
  by the U.S. and foreign governments, concerns about the general condition of
  the capital markets, financial instruments, banks, investment banks, insurers
  and other financial institutions caused the broader credit markets to further
  deteriorate and stock markets to decline substantially. In addition, general
  economic indicators have deteriorated, including declining consumer sentiment,
  increased unemployment and declining economic growth and uncertainty about corporate
  earnings.

While these conditions appear to have improved slightly in 2011
and into 2012, unprecedented disruptions in the credit and financial markets
have had a significant material adverse impact on a number of financial
institutions and have limited access to capital and credit for many companies.
These disruptions could, among other things, make it more difficult for the
Company to obtain, or increase its cost of obtaining, capital and financing for
its operations. The Companys access to additional capital may not be available
on terms acceptable to it or at all.

General
economic conditions:The recent unprecedented events in global financial
markets have had a profound impact on the global economy. Many industries,
including the gold and base metal mining industry, are impacted by these market
conditions. Some of the key impacts of the current financial market turmoil
include contraction in credit markets resulting in a widening of credit risk,
devaluations and high volatility in global equity, commodity,
  foreign exchange and precious metal markets, and a lack of market liquidity.
  A continued or worsened slowdown in the financial markets or other economic
  conditions, including but not limited to, consumer spending, employment rates,
  business conditions, inflation, fuel and energy costs, consumer debt levels,
  lack of available credit, the state of the financial markets, interest rates,
and tax rates may adversely affect our growth and profitability. Specifically:

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- 23 -

- The global credit/liquidity crisis could impact the cost and availability
  of financing and the Companys overall liquidity;
- the volatility of gold prices may impact the Companys future revenues,
  profits and cash flow;
- volatile energy prices, commodity and consumables prices and currency
  exchange rates impact potential production costs; and/or,
- the devaluation and volatility of global stock markets impacts the
  valuation of the Common Shares, which may impact the Companys ability to
  raise funds through the issuance of Common Shares.

These factors could have a material adverse effect on the
Companys financial condition and results of operations.

Insufficient
Financial Resources: The Company does not presently have sufficient
financial resources to undertake by itself the development of the Livengood
project as a mine following any production decision that may be made. The
development of a mine at Livengood following any production decision that may be
made will therefore depend upon the Companys ability to obtain financing
through equity and debt financing. There is no assurance that the Company will
be successful in obtaining the required financing. Failure to raise the required
funds could result in the Company being unable to commence or complete the
development of a mine at Livengood and/or being required to dispose of its
interest in its properties.

Financing
Risks: The Company has limited financial resources, has no source of
operating cash flow and has no assurance that additional funding will be
available to it for further exploration and development of the Livengood project
or to fulfil its obligations under any applicable agreements. Although the
Company has been successful in the past in obtaining financing through the sale
of equity securities, there can be no assurance that it will be able to obtain
adequate financing in the future or that the terms of such financing will be
favourable. Failure to obtain such additional financing could result in delay or
indefinite postponement of further exploration and development of the Livengood
project with the possible loss of such property.

Dilution
  to the Companys existing shareholders:The Company may require additional
  equity financing be raised in the future. The Company may issue securities on
  less than favourable terms to raise sufficient capital to fund its business
  plan. Any transaction involving the issuance of equity securities or securities
  convertible into Common Shares would result in dilution, possibly substantial,
  to present and prospective holders of Common Shares.

Increased
costs:Management anticipates that costs at the Companys projects will
frequently be subject to variation from one year to the next due to a number of
factors, such as changing ore grade, metallurgy and revisions to mine plans, if
any, in response to the physical shape and location of the ore body. In
addition, costs are affected by the price of commodities such as fuel, rubber
and electricity. Such commodities are at times subject to volatile price
movements, including increases that could make production at certain operations less profitable. A material
increase in costs at any significant location could have a significant effect on
the Companys profitability.

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- 24 -

Dependence
Upon Others and Key Personnel: The success of the Companys operations will
depend upon numerous factors, many of which are beyond the Companys control,
including the ability to attract and retain additional key personnel in
exploration, mine development, sales, marketing, technical support and finance.
These and other factors will require the use of outside suppliers as well as the
talents and efforts of the Company. There can be no assurance of success with
any or all of these factors on which the Companys operations will depend. The
Company has relied and may continue to rely, upon consultants and others for
operating expertise.

Currency
Fluctuations: The Company maintains its accounts in Canadian and U.S.
dollars, making it subject to foreign currency fluctuations. Such fluctuations
may materially affect the Companys financial position and results.

Share
Price Volatility: In recent years, the securities markets in the United
States and Canada have experienced a high level of price and volume volatility,
and the market price of securities of many companies, particularly those
considered exploration or development stage companies, have experienced wide
fluctuations in price which have not necessarily been related to the operating
performance, underlying asset values or prospects of such companies. There can
be no assurance that significant fluctuations in the trading price of the
Companys common shares will not occur, or that such fluctuations will not
materially adversely impact on the Companys ability to raise equity funding
without significant dilution to its existing shareholders, or at all.

Exploration
and Mining Risks: Fires, power outages, labour disruptions, flooding,
explosions, cave-ins, landslides and the inability to obtain suitable or
adequate machinery, equipment or labour are other risks involved in the
operation of mines and the conduct of exploration programs. Substantial
expenditures are required to establish reserves through drilling, to develop
metallurgical processes, to develop the mining and processing facilities and
infrastructure at any site chosen for mining. Although substantial benefits may
be derived from the discovery of a major mineralized deposit, no assurance can
be given that minerals will be discovered in sufficient quantities to justify
commercial operations or that funds required for development can be obtained on
a timely basis. The economics of developing mineral properties is affected by
many factors including the cost of operations, variations of the grade of ore
mined, fluctuations in the price of gold or other minerals produced, costs of
processing equipment and such other factors as government regulations, including
regulations relating to royalties, allowable production, importing and exporting
of minerals and environmental protection. In addition, the grade of
mineralization ultimately mined may differ from that indicated by drilling
results and such differences could be material. Short term factors, such as the
need for orderly development of ore bodies or the processing of new or different
grades, may have an adverse effect on mining operations and on the results of
operations. There can be no assurance that minerals recovered in small scale
laboratory tests will be duplicated in large scale tests under on-site
conditions or in production scale operations. Material changes in geological
resources, grades, stripping ratios or recovery rates may affect the economic
viability of projects.

Environmental
Restrictions: The activities of the Company are subject to environmental
regulations promulgated by government agencies in different countries from time
to time. Environmental legislation generally provides for restrictions and
prohibitions on spills, releases or emissions into the air, discharges into
water, management of waste, management of hazardous substances, protection of
natural resources, antiquities and endangered species and reclamation of lands
disturbed by mining operations. Certain types of operations require the
submission and approval of environmental impact assessments. Environmental
legislation is evolving in a manner which means stricter standards, and
enforcement, fines and penalties for non-compliance are more stringent.
Environmental assessments of proposed projects carry a heightened degree of
responsibility for companies and directors, officers and employees. The cost
of compliance with changes in governmental regulations has a
potential to reduce the profitability of operations.

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- 25 -

Regulatory
Requirements: The activities of the Company are subject to extensive
regulations governing various matters, including environmental protection,
management and use of toxic substances and explosives, management of natural
resources, exploration, development of mines, production and post-closure
reclamation, exports, price controls, taxation, regulations concerning business
dealings with indigenous peoples, labour standards on occupational health and
safety, including mine safety, and historic and cultural preservation. Failure
to comply with applicable laws and regulations may result in civil or criminal
fines or penalties, enforcement actions thereunder, including orders issued by
regulatory or judicial authorities causing operations to cease or be curtailed,
and may include corrective measures requiring capital expenditures, installation
of additional equipment, or remedial actions, any of which could result in the
Company incurring significant expenditures. The Company may also be required to
compensate those suffering loss or damage by reason of a breach of such laws,
regulations or permitting requirements. It is also possible that future laws and
regulations, or more stringent enforcement of current laws and regulations by
governmental authorities, could cause additional expense, capital expenditures,
restrictions on or suspension of the Companys operations and delays in the
exploration and development of the Livengood project.

Limited
Experience with Development-Stage Mining Operations: The Company has limited
experience in placing resource properties into production, and its ability to do
so will be dependent upon using the services of appropriately experienced
personnel or entering into agreements with other major resource companies that
can provide such expertise. There can be no assurance that the Company will have
available to it the necessary expertise when and if it places the Livengood
property into production.

Estimates
of Mineral Reserves and Resources and Production Risks: The mineral resource
estimates included in this AIF are estimates only and no assurance can be given
that any particular level of recovery of minerals will in fact be realized or
that an identified reserve or resource will ever qualify as a commercially
mineable (or viable) deposit which can be legally and economically exploited.
The estimating of mineral resources and mineral reserves is a subjective process
and the accuracy of mineral resource and mineral reserve estimates is a function
of the quantity and quality of available data, the accuracy of statistical
computations, and the assumptions used and judgments made in interpreting
available engineering and geological information. There is significant
uncertainty in any mineral resource or mineral reserve estimate and the actual
deposits encountered and the economic viability of a deposit may differ
materially from the Companys estimates. In addition, the grade of
mineralization ultimately mined may differ from that indicated by drilling
results and such differences could be material. Production can be affected by
such factors as permitting regulations and requirements, weather, environmental
factors, unforeseen technical difficulties, unusual or unexpected geological
formations and work interruptions. Short term factors, such as the need for
orderly development of deposits or the processing of new or different grades,
may have a material adverse effect on mining operations and on the results of
operations. There can be no assurance that minerals recovered in small scale
laboratory tests will be duplicated in large scale tests under on-site
conditions or in production scale operations. Material changes in reserves or
resources, grades, stripping ratios or recovery rates may affect the economic
viability of projects. The estimated resources described in this AIF should not
be interpreted as assurances of mine life or of the profitability of future
operations. Estimated mineral resources and mineral reserves may have to be
re-estimated based on changes in applicable commodity prices, further
exploration or development activity or actual production experience. This could
materially and adversely affect estimates of the volume or grade of
mineralization, estimated recovery rates or other important factors that
influence mineral resource or mineral reserve estimates. Market price
fluctuations for gold, silver or base metals, increased production costs or
reduced recovery rates or other factors may render any particular reserves
uneconomical or unprofitable to develop at a particular site or sites. A
reduction in estimated reserves could require material write downs in
investment in the affected mining property and increased amortization,
reclamation and closure charges.

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Mineral
resources are not mineral reserves and there is no assurance that any mineral
resources will ultimately be reclassified as proven or probable reserves.
Mineral resources which are not mineral reserves do not have demonstrated
economic viability.

Enforcement
of Civil Liabilities: As substantially all of the assets of the Company and
its subsidiaries are located outside of Canada, and certain of the directors and
officers of ITH are resident outside of Canada, it may be difficult or
impossible to enforce judgements granted by a court in Canada against the assets
of the Company or the directors and officers of ITH residing outside of Canada.

Mining
Industry is Intensely Competitive: The Companys business of the
acquisition, exploration and development of mineral properties is intensely
competitive. The Company may be at a competitive disadvantage in acquiring
additional mining properties because it must compete with other individuals and
companies, many of which have greater financial resources, operational
experience and technical capabilities than the Company. The Company may also
encounter increasing competition from other mining companies in efforts to hire
experienced mining professionals. Competition for exploration resources at all
levels is currently very intense, particularly affecting the availability of
manpower, drill rigs and helicopters. Increased competition could adversely
affect the Companys ability to attract necessary capital funding or acquire
suitable producing properties or prospects for mineral exploration in the
future.

ITH
may be a passive foreign investment company under the U.S. Internal Revenue
Code, which may result in material adverse U.S. federal income tax consequences
to investors in Common Shares that are U.S. taxpayers: Investors in Common
Shares that are U.S. taxpayers should be aware that ITH believes that it has
been in prior years, and expects it will be in the current year, a passive
foreign investment company under Section 1297(a) of the U.S. Internal Revenue
Code (a PFIC). If ITH is or becomes a PFIC, generally any gain recognized on
the sale of the Common Shares and any excess distributions (as specifically
defined) paid on the Common Shares must be rateably allocated to each day in a
U.S. taxpayers holding period for the Common Shares. The amount of any such
gain or excess distribution allocated to prior years of such U.S. taxpayers
holding period for the Common Shares generally will be subject to U.S. federal
income tax at the highest tax applicable to ordinary income in each such prior
year, and the U.S. taxpayer will be required to pay interest on the resulting
tax liability for each such prior year, calculated as if such tax liability had
been due in each such prior year.

Alternatively,
a U.S. taxpayer that makes a qualified electing fund (a QEF) election with
respect to ITH generally will be subject to U.S. federal income tax on such U.S.
taxpayers pro rata share of ITHs net capital gain and ordinary earnings
(as specifically defined and calculated under U.S. federal income tax rules),
regardless of whether such amounts are actually distributed by ITH. U.S.
taxpayers should be aware, however, that there can be no assurance that ITH will
satisfy record keeping requirements under the QEF rules or that ITH will supply
U.S. taxpayers with required information under the QEF rules, in event that ITH
is a PFIC and a U.S. taxpayer wishes to make a QEF election. As a second
alternative, a U.S. taxpayer may make a mark-to-market election if ITH is a
PFIC and the Common Shares are marketable stock (as specifically defined). A
U.S. taxpayer that makes a mark-to-market election generally will include in
gross income, for each taxable year in which ITH is a PFIC, an amount equal to
the excess, if any, of (a) the fair market value of the Common Shares as of the
close of such taxable year over (b) such U.S. taxpayers adjusted tax basis in
the Common Shares.

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Material Mineral Project

******      
***Livengood Project, Alaska***

Information
in this AIF regarding the Livengood project is based upon information provided
by the Livengood Report. The Livengood Report provides documentation of the
geological, operational, and resource estimation procedures that have been
undertaken by the Company as it continues to advance the Livengood Project.
Portions of the following summary are from the Livengood Report and the detailed
disclosure in the Livengood Report is incorporated into this AIF by reference.
Readers are encouraged to review the entire Livengood Report, which is filed on
SEDAR at www.sedar.com.

1.0 Introduction

The Livengood Report has been prepared to update the mining
configuration and Preliminary Economic Assessment (PEA) for the Livengood
Project to reflect recent information developed as part of the ongoing
Pre-feasibility Studies (PFS). The Livengood project is currently performing
exploration, resource definition and technical studies as part of the PFS which
is scheduled for completion in Q4 of 2011. A PEA was performed previously to
evaluate preliminary project concepts including possible mineralization
processing methods, estimates of capital and operating costs, and preliminary
surface mine design scenarios in November 2010. This update of the November 2010
technical report is based on the resource estimate updated August 22, 2011,
prepared from data to May 31, 2011 and based on other PFS technical information
as of August 1, 2011.

Field investigations at the Livengood property are ongoing,
with a total of 9 drilling rigs working at the site during the Summer 2011
program. Ongoing field data collection includes environmental baseline data
collection (water quality sampling, wildlife studies, air quality) and
meteorological sampling, geotechnical data collection for mine design, site
evaluation and geotechnical data collection for project infrastructure location,
groundwater hydrogeological testing, and rock geochemical characterization.
Drilling activities have been expanded to include district exploration and site
condemnation, as well as continuing the resource definition and infill drilling
at Money Knob. A 3D IP geophysical program to survey the Livengood District will
be completed in Q3 2011. The geologic database supporting the Livengood Report
is the 648 diamond and reverse circulation holes that had been drilled on the
property to May 31, 2011, and provided the basis for reporting an update of the
in-situ gold resource estimate.

The Livengood Report is the twelfth in the series of technical
reports and the eleventh that supports resource estimates which have been
regularly updated as new drill information has become available. The Livengood
Report describes the pre-feasibility concept based on a gravity-flotation-CIL
recovery method processing mineralized material recovered by surface mining.
Estimates of capital and operating cost, and a preliminary surface mine design
are included, along with the geological and resource estimation procedures that
have been undertaken by the Company. The updated mineral resource estimate
includes material in the measured, indicated and inferred classification based
on borehole data up to May 31, 2011. It does not include drill results from the
Companys 2011 Summer drill program which is currently in progress.

All costs in the Livengood Report are reported in US Dollars.

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2.0 Description and Location

The Livengood property is located approximately 115 km
northwest of Fairbanks, Alaska in the Tolovana Mining District within the
Tintina Gold Belt. The project area is centered on Money Knob, a local
topographic high point. This feature and the adjoining ridge lines are the
probable lode gold source for the Livengood placer deposits which lie in the
adjacent valleys which have been actively mined since 1914 and have produced
more than 500,000 ounces of gold.

The Company controls 100% of its ~125 square kilometre
Livengood land package, which is made up of 115 Alaska State mining claims, fee
simple land leased from the Alaska Mental Health Land Trust, and four leases
with holders of state and federal patented and unpatented mining and placer
claims.

3.0 Accessibility, Climate, Local Resources, Infrastructure
and Physiography

Livengood is located approximately 115 km north of Fairbanks,
Alaska next to the Elliot Highway, a paved, all weather road linking the north
slope oil fields at Prudhoe Bay to southern Alaska. It is also adjacent to the
Alyeska Pipeline corridor, which transports crude oil from Prudhoe Bay south and
contains the fiber optic communications cable utilized at the Livengood site.

Topography at the site is eroded hills and valleys with
generally 200 m elevation difference. The valleys generally contain active
streams draining into the Tolovana River system to the west.

The site is approximately 65 km south of the Arctic Circle, and
has a subarctic climate with long, cold winters and short, warm summers. Annual
precipitation is roughly 41 cm. Average low temperatures in winter are -21 to
-28 degrees C, with records reaching as low as -55 degrees C.

The Fairbanks metropolitan area has a population of
approximately 98,000 people, and comprises the regional center with hospitals,
government offices, businesses and the University of Alaska, Fairbanks. The city
is linked to southern Alaska along a north-south transportation and utility
corridor that includes 2 paved highways, a railroad, an interlinked electrical
grid, and communications infrastructure. The city has a regional airport
serviced by up to 3 major airlines.

4.0 History

The property has been prospected and explored by several
companies and private individuals since the 1970s. Geochemical surveys by
Cambior in 2000 and AngloGold Ashanti (U.S.A.) Exploration Inc. (AGA) in 2003
and 2004 outlined a 1.6 x 0.8 km area with anomalous gold in soil. Scattered
anomalous samples continue along strike for an additional 5 km to the northeast
and 1.6 km to the southwest. Eight reverse circulation holes were drilled by AGA
in 2003 and a further 4 diamond core holes were drilled in 2004 to evaluate this
anomaly. Favourable results from these holes revealed wide intervals of gold
mineralization (BAF-7: 138.7m @ 1.07 g/t Au; MK-04-03: 55.3m @ 0.51 g/t Au)
along with lesser intervals over a broad area. Over the past 5 years,
exploration by ITH through its wholly owned Alaskan subsidiary, Talon Gold
Alaska, Inc., has evaluated this mineralization utilizing both RC drilling and
core drilling.

Beginning in 2009, technical studies have been performed to
generate metallurgical data for process definition, to generate preliminary
surface mine designs, and to develop pre-conceptual information on the location
and capacities of potential tailings management, overburden management, water
reservoir, and mill process facilities. Conceptual project configurations have
been generated from these studies which have been used as the basis for
projected operating and capital cost estimation. A PEA for a large surface mining and mill processing facility was generated to
update ITH information being developed for the current Pre-feasibility Study.

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5.0 Geologic Setting and Mineralization

Rocks at Livengood are part of the Livengood Terrane, an
eastwest belt, approximately 240 km long, consisting of tectonically
interleaved assemblages of various ages. These assemblages include the Amy Creek
Assemblage, a sequence of latest Proterozoic and/or early Paleozoic basalt,
mudstone, chert, dolomite, and limestone. An early Cambrian ophiolite sequence
of mafic and ultramafic sea floor rocks was thrust over the Amy Creek Assemblage
and was, in turn, overthrust by a sequence of Devonian shale, siltstone,
conglomerate, volcanic, and volcaniclastic rocks, which are the dominant host to
the mineralization currently under exploration at Livengood. The Devonian
assemblage was overthrust by a second klippe of Cambrian ophiolite rocks. All of
these rocks are intruded by Cretaceous multiphase monzonitic and syenitic dikes
and sills. Gold mineralization is spatially and temporally associated with these
intrusive rocks.

Gold mineralization occurs in association with disseminated
arsenopyrite and pyrite in volcanic, sedimentary, and intrusive rocks, and in
quartz veins cutting the more competent lithologies, primarily volcanic rocks,
sandstones, and, to a lesser degree, ultramafic rocks. Three principal stages of
alteration are currently recognized, an early biotite stage, followed by
albite-quartz, and a late sericite-quartz assemblage. Carbonate appears to have
been introduced with and subsequent to these stages. Arsenopyrite and pyrite
were introduced primarily during the albite-quartz and sericite-quartz stages.
Gold correlates strongly with arsenic and occurs primarily within and on the
margins of arsenopyrite and pyrite.

Mineralization is interpreted as intrusion-related, consistent
with other gold deposits of the Tintina Gold Belt, and has a similar As-Sb
geochemical association. Mineralization is controlled partly by lithologic
units, but thrust-fold architecture was key to providing pathways for intrusive
and associated hydrothermal fluids.

Local fault and contact limits to mineralization have been
identified, but overall the deposit has not been closed off in any direction.
The current resource and area drilled covers the most significant portion of the
area with anomalous gold in surface soil samples, but still represents only
about 25% of the total gold-anomalous area.

6.0 Deposit Type

Among deposits of the Tintina Gold Belt, Livengood
mineralization is most similar to the dike and sill-hosted mineralization at the
Donlin Creek deposit, where gold occurs in narrow quartz veins associated with
dikes and sills of similar composition. The age of the intrusions and the
genetic link between the mineralization and intrusive rocks are typical of those
of other nearby gold deposits of the Tintina Gold Belt, which have been
characterized as intrusion-related gold systems and for these reasons Livengood
is best classified with them.

7.0 Exploration

Prior to ITH, several companies have explored the Livengood
area and identified a sizeable area of anomalous gold in soil samples, and
intervals of anomalous gold mineralization in drill holes. The Company advanced
the soil sampling coverage and undertook to drill surface geochemical anomalies
beginning in 2006. The Company has continued its exploration with step-out
drilling on a 75 m grid, and infilling the 75 m pattern in the core of the mineralized
areas. Infill and step out drilling in the resource area has continued in the
Summer 2011 drill program.

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The Company has also implemented a district exploration
program, which includes core drilling in geochemical anomalies distal to the
resource area and condemnation drilling in potential infrastructure locations. A
3D IP survey has also been conducted during the Summer of 2011 to generate
targets over much of the district.

8.0 Drilling

The Company has conducted drilling campaigns on the Livengood
property since 2006. These programs initially identified mineralization in the
Core Zone and then identified the Northeast, Sunshine, and Southwest zones
through step out drilling and drill testing of areas with anomalous values in
surface soil samples.

Nearly all drill holes at Money Knob have been drilled in a
northerly direction at an inclination of -50° (RC) and -60° (core) in order to
best intercept the south dipping structures and mineralized zones as close to
perpendicular as possible. A few holes have been drilled in other directions to
test other features and aspects of mineralization. Most holes have been spaced
at 75m along lines 75m apart, subsequent infill drilling in the center of 75m
squares brings the nominal drill spacing to 50m for a significant portion of the
deposit.

Diamond core holes represent 16% of the total number of holes
drilled. Core is recovered using triple tube techniques to ensure good recovery
(>95%) and confidence in core orientation. The core is oriented using either
the ACTTM or the EZ MarkTM tools.

Reverse circulation holes are bored and cased for the upper
0-30m to prevent down hole contamination and to help keep the hole open for ease
of drilling at greater depths. Recovery of sample material from RC holes is done
via a cyclone and dry or wet splitter, according to conditions. Drill cuttings
are collected over the course of each 1.5 m (five-foot) interval and captured
for a primary sample, an equivalent secondary sample (Met sample) and a third
batch of chips for logging purposes.

In the deposit drill hole locations are determined by sub-meter
differential GPS surveys at the drill collar. The initial azimuth of drill hole
collars is measured using a tripod mounted transit compass in conjunction with a
laser alignment device mounted on the hole collar. Down hole surveys of core and
RC drill holes are completed using a Gyro-Shot survey instrument manufactured by
Icefield Tools Corporation. Results of surveys and duplicate tests show normal
minor deviation in azimuth and inclination for drill holes.

All RC samples are logged in on site, analyzed with a field
portable Thermo Fisher Scientific NITONTM XRF before being sealed in
super sacks and delivered to ALS Chemex in Fairbanks for preparation. Detail
logging and mark-up of core is done at the Livengood camp. Core is sawed in half
and bagged according to geologic intervals up to 1.5m and sealed in super sacks
for delivery to ALS Chemex in Fairbanks.

Samples are analyzed by standard 50g fire assay for the gold
determinations. All core samples and select RC drilling samples are also
submitted for multi-element ICP-MS analyses using a 4 acid digestion technique.
All RC samples are analyzed on site for trace elements using a Thermo Fisher
Scientific NITONTM portable XRF before shipment to the laboratory.

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9.0 Sample Preparation, Analyses and Security

The Company samples all holes from surface to total depth,
using defined procedures. For RC samples, pulverized material is passed through
a cyclone to separate solids from drilling fluids, then over a spinning conical
splitter. The splitter is set to collect two identical splits of sample weighing
2-5 kg each. Representative coarse material is collected and saved in chip trays
for geological description. Samples are put in pre-numbered, bar-coded bags by
the drill site crew. One sample is submitted for analysis, and one sample is
kept for reference. Samples are secured on site, and transported to a sample
preparation facility operated by ALS Chemex in Faribanks.

Core materials are collected at the drill site and placed in
core boxes. Run blocks, orientation blocks and depths are placed in the boxes at
site. The core is transported to a sample management facility at Livengood,
where it is described, then sawn in half. Half of the core is collected for
assaying and half remains for reference. Core samples are weighed before
shipping.

The QA/QC program implemented by the Company meets or exceeds
industry standards. A QA/QC program includes insertion of blanks and standards
(1/10 samples) and duplicates (1/20 samples). Blanks help assess the presence of
any contamination introduced during sample preparation and help calibrate the
low end of the assay detection limits. Commercial standards are used to assess
the accuracy of the analyses. Duplicates help assess the homogeneity of the
sample material and the overall sample variance. The Company has undertaken
rigorous protocols to assure accurate and precise results. Among other methods,
weights are tracked throughout the various steps performed in the laboratory to
minimize and track errors. A group of 2096 metallic screen fire assays performed
in 2011 did not indicate any bias in the matching fire assays.

Data entry and database validation procedures have been checked
and found to conform to industry practices. Procedures are in place to minimize
data entry errors. These include pre-numbered, pre-tagged, bar-coded bags, and
bar-coded data entry methods which relate all information to sample and drill
interval information. Likewise, data validation checks are run on all
information used in the geologic modeling and resource estimation process.
Database entries for a random sample (10%) of drill holes used for the resource
estimate were checked against the original Assay Certificates by one of the
independent authors of the Livengood Report and the error rate was found to be
within acceptable limits.

Analysis of assay data from core and RC sampling has been
performed to check for downhole contamination of RC and to compare the data
distributions produced by the two methods. Analysis of RC data has not indicated
cyclic down hole contamination. Decay analysis conducted on both core drilling
and RC drilling indicates similar patterns of monotonic grade increase or
decrease. Comparison of the grade distributions between core and RC data were
conducted using Quantile-Quantile plots, and simulation of population means for
different numbers of samples. The comparison indicated that the mean of all core
data was 4% lower than RC data. Comparison of core and RC data below the water
table showed similar population means suggesting that down hole contamination
was not occurring.

10.0 Data Verification

Core and RC check samples have been collected during each
drilling campaign by independent third parties. Results from these samples, as
well as blanks and standards included, are consistent with the Companys initial
results. This includes a similar increase in variance for samples at higher
grades, a pattern consistent with nugget effect. No systematic high or low bias
has been observed.

The Summer 2011 drilling includes three separate programs to
develop data on grade continuity at reduced drill spacing, and on precision of
grade estimation using both core and RC data. Two cross patterns are being drilled with spacing reduced to 15 m along
the primary grid axes to evaluate grade continuity between holes. A block of
approximately 9 million tonnes is being drilled with equal numbers of RC and
core holes, drilled with 2 different orientations. This block will allow the
evaluation of the precision of resource modeling at different data densities and
with different types of sampling.

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11.0 Mineral Processing and Metallurgical Testing

The Company has undertaken metallurgical and processing test
work to determine optimal recoveries using numerous conventional flow sheets:
including milling with gravity, flotation, and Carbon in Leach (CIL) or
gravity and CIL of the gravity tails, and heap leaching. Current test work
focuses on determining the best means of optimizing these combined recovery
methods. This work involves studies that evaluate how gold mineralization occurs
and how the mineralized materials vary in their physical and metallurgical
response to process treatment parameters according to the various lithologic
units that host mineralization. The characteristics under review include
grindability, abrasiveness, optimal particle size for downstream treatment, and
response to leach, flotation, or gravity unit operations as a function of
oxidation and lithology.

Specific metallurgical characteristics, identified in the
testing programs to date, have shaped the processing strategies used as the
basis for the PEA and assumed project configuration. These important
metallurgical findings are:

| | 1) | variable metallurgy (chemical and physical properties),
      depending upon mineralization type, degree of oxidation, amount of organic
      carbon, etc.;                                                                                                              
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 2) | identification of mineralization types that are amenable
      to simple cyanide leaching process techniques such as heap leaching in
      conjunction with a carbon in column adsorption plant (CIC), particularly
      oxidized and partially oxidized mineralization;
| | 3) | identification of sediment-hosted mineralization that
      contains organic preg-robbing carbon that will require CIL process
      techniques;                                                                                                                        
| | 4) | higher recoveries for most mineralization types using
      gravity separation in combination with downstream CIL and/or flotation
      separation techniques; and                                                                                                       
| | 5) | lower recoveries for mineralization types with arsenic
      association.                                                                                                                                                                                                 

Specific observations about metallurgical performance are
listed in the following:

- Most Livengood mineralization could be considered moderately soft to
  medium hard in hardness with an average Bond Ball Work index of 15.8. The
  mineralization varied significantly in hardness, with Bond Ball Work indices
  varying from a minimum of 11.1 to a maximum of 19.1.
- The majority of the mineralization would be considered non-abrasive, with
  an average Abrasion Index of 0.0809. The mineralization type abrasion
  characteristics varied significantly from 0.0023 to 0.2872.
- All of the Livengood mineralization types respond to cyanide leaching to
  some degree.
- Some of the unoxidized mineralization with organic carbon has active or
  preg- robbing carbon.
- The effect of leach times on gold recovery and gravity concentration
  results indicate some of the mineralization contains coarse gold.
- Gold recovery at 10 mesh particle size on some of the mineralization types
  exceeded 90 percent.

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- Gold recovery on some of the mineralization types, but not all, is
  improved with finer grinding. A grind size where 80 percent (p80) of the
  particles are smaller than 200 mesh (74 microns) has been tested to date.
- The leaching of flotation concentrates, in preliminary tests, shows
  variable results depending on the mineralization type and the amount of
  arsenopyrite present.
- Fine grinding of flotation concentrates to less than 20 microns, in
  preliminary tests, does not significantly improve CIL gold recovery from this
  material.
- Initial flotation and gravity concentration tests indicate the combined
  processes exceed 90% gold recovery to the concentrates.
- The degree of oxidation of the mineralization, as observed by the
  geologists, has a marginal impact on the gold recovery.
- Differences in gold recovery between cyanide shake leach tests, bottle
  roll leach tests, and Carbon-in-Leach tests suggest organic carbon in the
  mineralization is active to varying degrees in some of the mineralization
  types, particularly the un-oxidized portions of those mineralization types.
- The gold is often associated with sulfides, but this mineralization would
  not be classified as a sulfide refractory type.

12.0 Resource Estimation

The Livengood Report presents a global mineral resource
estimate updated from the April 2011 estimate. The resource model was
constructed using Gemcom GEMS® and the Stanford GSLIB (Geostatistical
Software Library) MIK post processing routine. The resource was estimated using
Multiple Indicator Kriging techniques.

Model parameters include, among others, two oxidation
indicators and a single lithology indicator for each minor lithology. A
three-dimensionally defined lithology model, based on interpretations by ITH
geologists, was used to code the rock type block model. A three-dimensionally
defined probability grade shell (0.1 g/t) was used to constrain the gold
estimation. Gold contained within each block was estimated using nine indicator
thresholds. The block model was tagged with the geologic model using a block
majority coding method. Because there are significant grade discontinuities at
lithologic contacts, hard boundaries were used between each of the lithologic
units so that data for each lithology was used only for that unit.

A summary of the estimated global (in-situ) mineral resource is
presented below for cutoff grades of 0.2, 0.3, 0.5, and 0.7 g/t gold.

Model validation checks include global bias check, visual
validation, and swath plots. In all cases, the model appears to be unbiased and
fairly represent the drilling data.

Table 1.1Global Resource Estimation Summary- August 2011

Classification
    Au Cutoff
      (g/t)
    Tonnes
      (millions)
    Au (g/t)
    Million Ounces AuMeasured
    0.20
    742
    0.54
    12.8Indicated
    0.20
    322
    0.47
    4.8Inferred
    0.20
    447
    0.42
    6.1Measured
    0.30
    562
    0.63
    11.4Indicated
    0.30
    216
    0.58
    4.0Inferred
    0.30
    279
    0.53
    4.8


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Measured
    0.50
    298
    0.84
    8.0Indicated
    0.50
    96
    0.81
    2.5Inferred
    0.50
    102
    0.79
    2.6Measured
    0.70
    149
    1.09
    5.2Indicated
    0.70
    42
    1.10
    1.5Inferred
    0.70
    39
    1.10
    1.4


Economic testing of the global mineral resource has been
performed using Whittle mine optimization to generate a surface mining shell
defined at a long term gold price of $US 1,400 per ounce. Based on this mine
optimization, the surface mining mineral resource at the Money Knob deposit is
listed in Table 1.2.

Table 1.2 Surface Mine Mineral Resource defined at US
$1,400 per Au ounce.

Classification
      Au Cutoff (g/t)
      Tonnes (millions)
      Au (g/t)
      Million Ounces AuMeasured
    0.22*
    676
    0.56
    12.2Indicated
    0.22*
    257
    0.52
    4.3M&I
    0.22*
    933
    0.55
    16.5Inferred
    0.22*
    257
    0.50
    4.1


*- Cutoff grade* is average for
variable processing costs and recoveries.

Based on the study herein reported, delineated mineralization
of the Livengood Deposit is classified as a resource according to the following
definitions from NI 43-101 and from CIM (2005):

In this Instrument, the terms "mineral resource", "inferred
mineral resource", "indicated mineral resource" and "measured mineral resource"
have the meanings ascribed to those terms by the Canadian Institute of Mining,
Metallurgy and Petroleum, as the CIM Definition Standards on Mineral Resources
and Mineral Reserves adopted by CIM Council, as those definitions may be
amended. Due to the uncertainty that may be attached to Inferred Mineral
Resources, it cannot be assumed that all or any part of an Inferred Mineral
Resource will be upgraded to an Indicated or Measured Mineral Resource as a
result of continued exploration. Confidence in the estimate is insufficient to
allow the meaningful application of technical and economic parameters or to
enable an evaluation of economic viability worthy of public disclosure. Inferred
Mineral Resources must be excluded from estimates forming the basis of
feasibility or other economic studies.

Mineralization may be classified as an Indicated Mineral
Resource by the Qualified Person when the nature, quality, quantity and
distribution of data are such as to allow confident interpretation of the
geological framework and to reasonably assume the continuity of mineralization.
The Qualified Person must recognize the importance of the Indicated Mineral
Resource category to the advancement of the feasibility of the project. An
Indicated Mineral Resource estimate is of sufficient quality to support a
Preliminary Feasibility Study which can serve as the basis for major development
decisions.

Mineralization or other natural material of economic
interest may be classified as a Measured Mineral Resource by the Qualified
Person when the nature, quality, quantity and distribution of data are such that
the tonnage and grade of mineralization can be estimated to within close limits
and that variation from the estimate would not significantly affect potential
economic viability. This category requires a high level of confidence in, and
understanding of the geology and controls of the mineral deposit.

The current basis of project information is not
sufficient to convert the in-situ mineral resources to mineral reserves, and
mineral resources that are not mineral reserves do not have demonstrated
economic viability.

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- 35 -

13.0 Mineral Reserve Estimates

Mineral reserves have not been estimated for Livengood, because
the project does not currently meet the minimum requirement of a completed PFS.

14.0 Mining Methods

The project configuration assumes a large scale surface mining
operation using drill-blast-load-haul mining techniques. Major material handling
was assumed to be based on hydraulic excavators with 34 cubic meter buckets and
220 tonne capacity haul trucks. Peak mining rates are 75 million tonnes of
material, to sustain an annual throughput of 33.2 million tonnes of mineralized
material at the processing plant. The total production rates in early years
allow stockpiling of lower grade mineralized material to allow streaming of
higher grade materials to the process plant.

The mine life is projected to be 23 years to support a mill
throughput of 91,000 tonnes per day. Total mine production of mineralized
material is projected to be 750 Mt with 892 Mt of overburden material. The strip
ratio would be 1.19 overburden material to mineralized material. The mineralized
material would be comprised of measured, indicated and inferred classifications
in the proportions of 60%, 24%, and 16%, respectively.

Initial pioneering for the surface mine is assumed to start
with the initiation of construction at the site to provide borrow material for
construction of the tail dam. Minor production of mineralized material would
begin in the second year of construction, and then ramp up to deliver 22.5 Mtpa,
31.6 Mtpa and 32.6 Mtpa in production years 1, 2 and 3, respectively. Full
capacity would be achieved in year 4.

15.0 Recovery Methods

Preliminary processing assumptions are based on a flow sheet
that assumes a gravity gold circuit, followed by flotation to produce a
concentrate. Gold would be recovered from the concentrate using carbon-in-leach
cyanide leaching.

A single train plant is assumed with run-of-mine (ROM)
mineralized material delivered to a primary gyratory crusher, which would feed a
coarse stockpile. Coarse mineralized material would be reclaimed by apron
feeders discharging onto a SAG mill feed conveyor. A grinding circuit would
include a single SAG mill feeding two ball mills in parallel.

The ground, mineralized material would be routed through a
gravity circuit producing a rougher concentrate, which would be cleaned to
produce a gravity concentrate and gravity middlings. The gravity cleaner
concentrate would be processed in a gold refinery to produce dore'. Gravity
rougher tail would be returned to the grinding circuit, after a cyclone
separation of the fine fraction which would go to flotation directly.

Ground mineralized material, after removal of the gravity
recoverable gold, would go to a flotation cell where a rougher concentrate would
be created, which combined with the gravity middlings would be reground and then
leached in a CIL circuit to recover the contained gold. The CIL circuit would
produce a loaded carbon which would be acid washed, stripped of gold and then
reactivated for reuse. The refinery would use electrowinning to recover the
gold, which would then be refined to produce a dore'.

The plant throughput would be controlled by the SAG milling
capacity. Estimated gold recoveries have been based on the existing test work
and industry experience, and varies between 58-94% for the different lithologies
and oxidations.

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- 36 -

Projected metallurgical recoveries for each lithologic unit
have been estimated from the currently existing metallurgical test data. These
estimates have been used as the basis of the mine optimization work, but have
been increased by an additional 4 percentage points in the economic analysis to
account for anticipated improvements that may be possible with further process
optimization. Average recovery in the mine optimization output was 77.6%, but
has been increased to 81.6% in the economic analysis. This projected improvement
in recovery is based on previous experience of the Qualified Person in process
testing and plant optimization.

16.0 Project Infrastructure

Alaska infrastructure has been developed in a north-south
corridor between ports on the south coast (Anchorage, Valdez and others) and
Fairbanks in the center of the State. This includes communications, paved
highways, railroad, railbelt electrical grid, and major airports. The
metropolitan area around Fairbanks has a population of approximately 98,000
people.

The paved, all weather Elliot Highway runs north from Fairbanks
to the North Slope oilfields at Prudhoe Bay, and passes within several
kilometers of the Money Knob deposit. Communications infrastructure (fibreoptic)
has been extended to the North Slope along the Alyeska Pipeline, which parallels
the Elliot Highway and passes just west of Livengood.

In preliminary, nonbinding discussions, the local utility in
Fairbanks (Golden Valley Electrical Association) has indicated that 80-100 MW of
power could be available to the Livengood Project. Livengood would be connected
to the local grid by building a 64 km 230- kVA line along the pipeline corridor.
Environmental baseline studies required for the electrical line construction
were begun in 2011.

The development of site layout plans is underway as part of the
PFS. Primary infrastructure requiring construction at Livengood would be the
process plant, tail pipeline, electrical line, mine shops and buildings, and
site roads. Alternative sites have been investigated along the northern side of
the ridge containing the Money Knob deposit for the process plant, overburden
management facility and tail storage facility. A historical dam site, used to
store water for placer mining operations, is being investigated for water
storage.

17.0 Market Studies and Contracts

The market for gold is global in nature and is unlikely to be
unaffected by production from the Livengood Project. There are several large
third party gold refineries with well established industry relationships in
North America. Among the more notable ones are:

- Metalor; North Attleboro, Massachusetts
- Johnson Matthey; Salt Lake City, Utah
- Canadian Mint; Ottawa, Ontario

The Company has not contacted any of the aforementioned
companies for competitive treatment bids, rather utilizing industry averages for
this stage of development.

18.0 Environmental Studies, Permitting and Social and
Community Impacts

Based on review of the studies completed to date, there are no
known environmental issues that are anticipated to materially impact the
Livengood Projects ability to extract the gold resource. The Company has been conducting environmental baseline studies at
the Livengood Project since 2008. The environmental baseline programs conducted
or currently underway at Livengood include:

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- 37 -

- surface water quality and hydrology;
- groundwater hydrogeology;
- wetlands extent and characteristics;
- meteorology and air quality;
- aquatic life and resources;
- wildlife;
- cultural resources; and
- rock geochemical characteristics.

A site-specific monitoring plan and water management plan for
both operations and post mine closure will be developed in the future in
conjunction with detailed engineering and project permit planning. Since
development of the Livengood Project will require a number of US Federal
permits, the National Environmental Policy Act (NEPA) and Council of
Environmental Quality (CEQ) Regulations 40 CFR parts 1500-1508 will govern the
federal permitting portion of the Livengood Project. In fulfillment of the NEPA
requirements, the Livengood Project will be required to prepare an Environmental
Impact Statement (EIS). Although at this time it is unknown which department
will become the lead federal agency, the State of Alaska is expected to take a
cooperating role to coordinate the NEPA review with the State permit process.

Actual permitting timelines are controlled by the US Federal
NEPA review and US Federal and State agency decisions.

The Livengood Project is located 115 km northwest of Fairbanks,
Alaska and approximately 65 km north of the boundary of the Fairbanks North Star
Borough, in an unincorporated area of the State and encompasses a combination of
State of Alaska mining claims, State of Alaska Mental Health Trust lands,
private lands, and federal mining claims. While the old mining town of Livengood
no longer has year round residents or an organized government, there are
approximately 15 residents living on remote homesteads on the road system within
a 15 km radius of the Livengood Project. The nearest community is the village of
Minto, a town of 200 located approximately 65 km southwest by road from the
Livengood Project. Thus, while the local residents and the community of Minto
are important stakeholders in the region and to the Livengood Project, there are
no municipal or community agreements required for the Livengood Project.

19.0 Capital and Operating Costs

Capital cost estimates have been developed from evaluation of
the project configuration based on surface mining with a 91,000 tonne/day
processing plant. The Company engaged MTB Project Management Professionals, Inc.
to review capital cost that had been prepared in previous PEA estimates, make
appropriate adjustments, prepare capital estimates, develop a work breakdown
structure (WBS) for the capital cost, and develop an execution schedule for
the capital expenditures, based on the scope of work as defined as of July 2011.
Also, a sustaining capital cost estimate was to be prepared.

The capital cost scope was developed to a WBS. This WBS was
developed from several historical projects of similar scope. The capital
components of the estimate were allocated into two major groupings:

- Initial capital

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- 38 -

- Sustaining capital cost for both incremental capital and replacement
  capital.

Costs were defined by the preproduction milestone schedule,
with an approved feasibility study initiating the start of the capital cost
being incurred; costs prior to the approved feasibility study were considered to
be sunk costs. Initial capital cost was defined as all cost incurred before
startup, which is when the first mineralized material is discharged into the
primary crusher. Production year +1 begins at startup and defines operating
cost.

The capital cost summary is as follows:

Initial Capital Cost$1,614 millionLOM Sustaining Capital Cost $585
      millionContingency included in initial capital cost. $323 million


Project operating costs are based on comparison to similar
mining operations in Alaska and the USA. Table 1.3 lists the operating cost
assumptions used in the economic analysis.

Table 1.3 Operating Cost Assumptions

Operating area
      $/tonne processed
      $/tonne mined
      $/ozMining
    $ 3.87
    $ 1.77
    $ 225Processing
    $ 6.81
    -
    $ 395Administration
    $ 0.81
    -
    $ 47Refining and Transportation
    $ 0.08
    -
    $4.73Reclamation
    $ 0.07
    -
    $ 4.16Royalty @ 2.5%
    $0.47
    
    $27.50Total
    $ 12.12
    --
    $ 703


20.0 Economic Analyses

A pre-tax, 100% equity economic analysis has been performed
based on the following assumptions:

- Long term gold price of $1,100 per ounce in constant US dollars;
- US dollar terms (Exchange rate of US $1.00 = CAD $1.01)
- No cost escalation or inflation has been provided for
- Annual discount rate of 5%, as well as undiscounted cash flow and
  alternative annual discount rates of 7.5% and 10.0%.
- All cost prior to construction engineering, long lead item ordering and
  construction start up are considered sunk costs.

Under these assumptions, the Livengood Project is projected to
have an Internal Rate of Return (IRR) of 14.1%, an undiscounted cash flow of US
$3.41 B, and an NPV @ 5% of $1.24 B. Key economic performance parameters are
listed in Table 1.4.

---

- 39 -

Table 1.4 Projected Key economic performance parameters at
a long term gold price of US $1,100 per ounce.

EconomicsIRR
    
      
    
    
    14.14%NPV*
      
      0.00%
      
      $
      3,109,058NPV*
      
      5.00%
      
      $
      1,241,153NPV*
      
      7.50%
      
      $
      734,472NPV*
      
      10.00%
      
      $
      380,496Summary
      StatisticsInitial Capex
      
      
      
      $
      1,613,805Sustaining Capex
      
      
      
      $
      584,658Working Capex
      
      
      
      $
      31,774Gold recovered-oz
      
      
      
      
      12,924,668Cash operating cost/oz
      
      
      
      $
      703Total cost/oz
      
      
      
      $
      875Stripping ratio
      
      
      
      
      1.19LOM mill Au recovery
      
      
      
      
      81.6%


* - 000' $ US

Projected annual gold production and annual cash cost per Au
ounce are shown graphically in Figure 1.1 for the life-of-mine (LOM).
Sensitivities to gold price, recovery, opex and capes variations are listed in
Tables 1.5, 1.6, 1.7 and 1.8, respectively.

Figure 1.1 Projected annual gold production and annual
cash cost per produced Au ounce for the LOM.



---

- 40 -

Table 1.5 Variation of Projected Livengood Project IRR and
NPV (000' US $) for a gold price range of US $800 -$1,700.

Gold Price

Change
    IRR
    NPV 0%
    NPV 5%
    NPV 7.5%
    NPV 10%800
    -6.7%
    $ (654,735)
    $ (816,710)
    $ (857,480)
    $ (882,725)900
    3.7%
    $ 599,863
    $ (130,756)
    $ (326,829)
    $ (461,652)1000
    9.5%
    $ 1,854,461
    $ 555,198
    $ 203,821
    $ (40,578)1100
      14.1%
      $ 3,109,058
      $ 1,241,153
      $ 734,472
      $ 380,4961200
    18.2%
    $ 4,363,656
    $ 1,927,107
    $ 1,265,123
    $ 801,5701300
    22.0%
    $ 5,618,253
    $ 2,613,061
    $ 1,795,774
    $ 1,222,6441400
    25.5%
    $ 6,872,851
    $ 3,299,016
    $ 2,326,425
    $ 1,643,7181500
    28.8%
    $ 8,127,448
    $ 3,984,970
    $ 2,857,075
    $ 2,064,7911600
    32.0%
    $ 9,382,046
    $ 4,670,924
    $ 3,387,726
    $ 2,485,8651700
    35.1%
    $ 10,636,643
    $ 5,356,879
    $ 3,918,377
    $ 2,906,939


Table 1.6 Variation of Projected Livengood Project IRR and
NPV (000' US $) for process recovery change of 85-115% of the base assumption
(81.6%) .

Process recovery

Change
    IRR
    NPV 0%
    NPV 5%
    NPV 7.5%
    NPV 10%15%
    20.7%
    $ 5,179,144
    $ 2,372,977
    $ 1,610,046
    $ 1,075,26810%
    18.6%
    $ 4,489,115
    $ 1,995,703
    $ 1,318,188
    $ 843,6775%
    16.4%
    $ 3,799,087
    $ 1,618,428
    $ 1,026,330
    $ 612,0870%
      14.1%
      $ 3,109,058
      $ 1,241,153
      $ 734,472
      $ 380,496-5%
    11.7%
    $ 2,419,029
    $ 863,878
    $ 442,614
    $ 148,905-10%
    9.0%
    $ 1,729,001
    $ 486,603
    $ 150,756
    $ (82,685)-15%
    6.0%
    $ 1,038,972
    $ 109,328
    $ (141,102)
    $ (314,276)


Table 1.7 Variation of Projected Livengood Project IRR and
NPV (000' US $) for change in Opex of 85-115% of the base assumption.

Opex

Change
    IRR
    NPV 0%
    NPV 5%
    NPV 7.5%
    NPV 10%15%
    9.6%
    $ 1,815,100
    $ 554,864
    $ 210,542
    $ (30,494)10%
    11.2%
    $ 2,246,419
    $ 783,627
    $ 385,186
    $ 106,5035%
    12.7%
    $ 2,677,739
    $ 1,012,390
    $ 559,829
    $ 243,4990%
      14.1%
      $ 3,109,058
      $ 1,241,153
      $ 734,472
      $ 380,496-5%
    15.5%
    $ 3,540,377
    $ 1,469,916
    $ 909,115
    $ 517,493-10%
    16.8%
    $ 3,971,697
    $ 1,698,679
    $ 1,083,759
    $ 654,490-15%
    18.0%
    $ 4,403,016
    $ 1,927,442
    $ 1,258,402
    $ 791,486


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- 41 -

Table 1.8 Variation of Projected Livengood Project IRR and
NPV (000' US $) for change in Capex of 85-115% of the base assumption (81.6%) .

Capex

Change
    IRR
    NPV 0%
    NPV 5%
    NPV 7.5%
    NPV 10%15%
    11.5%
    $ 2,804,541
    $ 983,139
    $ 493,698
    $ 154,15710%
    12.3%
    $ 2,906,047
    $ 1,069,143
    $ 573,956
    $ 229,6035%
    13.2%
    $ 3,007,553
    $ 1,155,148
    $ 654,214
    $ 305,0500%
      14.1%
      $ 3,109,058
      $ 1,241,153
      $ 734,472
      $ 380,496-5%
    15.2%
    $ 3,210,564
    $ 1,327,157
    $ 814,730
    $ 455,943-10%
    16.3%
    $ 3,312,069
    $ 1,413,162
    $ 894,988
    $ 531,389-15%
    17.5%
    $ 3,413,575
    $ 1,499,167
    $ 975,246
    $ 606,836


21.0 Other Relevant Data and Information

No additional information or explanation is known by the
authors of the Livengood Report to be necessary to make the technical report
understandable and not misleading.

22.0 Interpretation and Conclusions

A PFS for the Livengood mineral resource is currently underway.
The Livengood Report provides an update of the anticipated project
configuration, and an overview of the geological, exploration, metallurgical
test work, process plant and infrastructure engineering, and surface mine
planning work that has been completed to date. A PEA of the updated
configuration has been developed which is based on a surface mining operation
supplying mineralized material to a processing plant with average throughput of
91,000 tonnes per day. The processing plant would produce gravity and flotation
concentrates with gold recovered by Carbon-in-Leach processing of the
concentrates. The PEA addresses the basic framework of how gold mineralization
will be mined, mineralized material processed, and recovery achieved.

The interpretation and conclusions supplied in the Livengood
Report are preliminary and are provided for the purposes of updating information
about ITHs progress in the PFS since the issuance of the November 2010
technical report. The information is subject to revision prior to its
incorporation into the final PFS document.

23.0 Recommendations

The Company will continue its investigations and studies at
Livengood with a projected FY 2011-2012 budget of US$ 68.1M ($67M CAD). The
continuing PFS work accounts for approximately 75% of the expenditure, with the
remaining 25% allocated to start up of the preparations for permit submittal and
start up of feasibility engineering.

During the Summer 2011 field program, completion of several
studies to demonstrate grade continuity and confirm precision of modeling with
increased drill density will provide important verification of the resource
estimation.

The PEA is preliminary in nature, and is based on forward
looking technical and economic assumptions which will be evaluated in the
Pre-feasibility Study. The PEA is based on the Livengood in-situ resource model
(August 2011, effective date of May 31, 2011) which consists of material in the
measured, indicated and inferred classification. Inferred mineral resources are
considered too speculative geologically to have technical and economic
considerations applied to them. The current basis of project information is not
sufficient to convert the in-situ mineral resources to mineral reserves, and
mineral resources that are not mineral reserves do not have demonstrated
economicviability. Accordingly, there can be no certainty that
the results estimated in the PEA will be realized. The PEA results are only
intended as an initial, first-pass review of the potential project economics
based on preliminary information.

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- 42 -

Planned Activities

The
Livengood Summer 2011 drill program began June 1st and included
exploration drilling for district-wide investigations, resource definition
drilling in the Money Knob deposit, and condemnation/geotechnical
characterization drilling for infrastructure location and design. The
district-wide exploration included 10,000 metres of helicopter supported core
drilling, 3,750 metres of which was exploration with the remainder having the
dual purpose of exploration/condemnation. Resource definition drilling at Money
Knob included close-spaced drilling in locations to test the continuity of
mineralization down to a 15 metre spacing, and the testing of a 9 million tonne
block with 50 holes distributed equally between core and RC drilling methods
with two different hole orientations. Total drilling was approximately 23,000
metres for completion of the PFS investigations in 2011. A group of deep
hydrologic monitoring and testing wells has been drilled into the surface mine
area for advanced characterization of ground water effects on slope stability.

The
district-wide exploration program also included 130,000 line-km of 3D IP
geophysical surveys, covering the Money Knob deposit and extending coverage over
the entire mineralized trend as indicated by drilling and surface soil sampling.
This survey will generate subsurface structural information to help target
future exploration drilling.

Completion
of the PFS is scheduled for the third quarter of 2012. The PFS underway will
incorporate the mineral resource outlined in the Livengood Report, together with
the results of geotechnical studies, metallurgical testing, updated capital and
operating cost estimates and other relevant studies. While the bulk of
engineering studies have been timely completed, a detailed metallurgical review
of the PEA flow sheet has indicated further optimization is possible. Extensive
metallurgical testing, including lock-cycle testing, additional gold deportment,
HPGR characterization and pilot plant tests is ongoing. This advanced testing
was scoped in Q3 2011 and composite samples were prepared in Q4 2011 from drill
samples produced in the Summer 2011 drilling program.

Baseline
environmental data collection programs continued in the Summer 2011 field
program. This included surface water quality and quantity sampling, fish tissue
sampling, wildlife characterization, meteorological and air quality sampling,
wetlands characterization, and antiquities surveys. Groundwater quality is also
being sampled, and groundwater monitoring wells have been constructed in the
Summer 2011 field program. Baseline data collection was extended to the power
line right-of-way, in preparation for design and permitting for extension of the
power line from the Fairbanks area.

In
conjunction with the PFS program, the Company has initiated a front-end loading
process during which the project configuration and design will be refined, with
the objective of entering the permitting process. This work has provided the
basis for the Winter 2012 field program, which is focussing on filling data gaps
identified in the PFS. The design basis will be improved to support Feasibility
Studies. Baseline environmental work will continue, and community outreach
programs will be expanded.

In
early March, 2012, the Company received the results for 73 in-fill drill holes
completed late in 2011 which confirm the integrity of the May 2011 resource
estimate contained in the Livengood Report. Based on the latest results, new
internal resource estimates calculated for three areas of the deposit have been
verified within 1% to contain the same tonnage, grade and contained ounces of
gold as those calculated from the nominal 50-metre-spaced grid drilling used to
calculate the May 2011 resource reported in the Livengood Report. The May 2011
resource estimate was based on 50-metre and, in fringe areas of the deposit, 75-metre grid drilling. Two areas of the
deposit, the Core and Sunshine crosses, were selected for 15-metre-spaced
reverse circulation (RC) in-fill drilling on crosses with north-south and
east-west legs 150 metres in length. A third area, Area 50, measuring 195 metres
by 240 metres, was drilled on a 37.5 -metre grid with alternating core and RC
drilling. Two resources were generated for each volume using ordinary kriging on
samples composited to 10-metre lengths: the first including those portions of
the 50-metre grid drilling (May 2011 resource) within the volume; and a second
using both the grid and close-spaced drilling within the same volume. On
average, the effect of the increased drilling density on tonnage, grade, and
contained ounces of gold is negligible (less than 1%).

---

- 43 -

Qualified Persons and Quality
Control/Quality Assurance

Tim Carew, P.Geo., of Reserva International, LLC., a mining
geo-scientist, is a Professional Geoscientist in the province of British
Columbia (No. 18453) and, as such, acted as the Qualified Person, as defined in
NI 43-101, for the May 2011 resource modeling for the Livengood deposit as
included in the Livengood Report. Mr. Carew has a B.Sc. degree in Geology, an
M.Sc in Mineral Production Management and more than 34 years of relevant
geological and mining experience in operating, corporate and consulting
environments. Both Mr. Carew and Reserva International, LLC. are independent of
the Company under NI 43-101.

Mr. William J. Pennstrom, Jr., of Pennstrom
Consulting Inc., a consulting metallurgical engineer, acted as the Qualified
Person, as defined in NI 43-101, for the metallurgy and mineral processing
programs for the Livengood deposit, and development of the PEA project financial
analysis, as included in the Livengood Report. Mr. Pennstrom has a BS degree in
Metallurgical Engineering and a Masters degree in Management. He has more than
26 years of relevant experience as a metallurgist, having functioned as an
operator, engineer, and process consultant over this time frame. Mr. Pennstrom
is also a Qualified Professional (QP) member of the Mining and Metallurgical
Society of America and is a Registered Member of the Society of Mining,
Metallurgy and Exploration. Both Mr. Pennstrom and Pennstrom Consulting Inc. are
independent of the Company under NI 43-101.

Mr. Scott Wilson, President of Scott E. Wilson Consulting Inc.,
is a consulting geologist specializing in surface mine design, optimization and
analysis, production scheduling, due diligence evaluations and Mineral Resource
and Reserve reporting. He is acting as Qualified Person, as defined in NI
43-101, for the open pit optimization and scheduling work for the Livengood
Deposit, as contained in the Livengood Report. Mr. Wilson has over 22 years
experience in surface mining and is a Registered Member of Society of Mining,
Metallurgy and Exploration. Mr. Wilson and Scott E. Wilson Consulting Inc. are
independent of the Company under NI 43-101.

Dr. Russell Myers CPG 11433, is a certified professional
geologist of the Association of Professional Geologists. He is responsible for
analysis of QA and QC data developed for drilling activities at Livengood, and
is a qualified person as defined by National Instrument 43-101. He acted as such
for the QA/QC sections of the Livengood Report. He holds a Ph.D. degree from the
University of the Witwatersrand and has 25 years experience managing surface
exploration and drilling programs in North America, South America, Africa and
Australia. Dr. Myers is not independent of ITH as he holds common shares and
incentive stock options.

The work program at Livengood was designed and is supervised by
Chris Puchner, Chief Geologist (CPG 07048), of the Company, who is responsible
for all aspects of the work, including the quality control/quality assurance
program. On-site personnel at the project photograph the core from each
individual borehole prior to preparing the split core. Duplicate reverse
circulation drill samples are collected with one split sent for analysis.
Representative chips are retained for geological logging. On-site personnel at
the project log and track all samples prior to sealing and shipping. All sample
shipments are sealed and shipped to ALS Chemex in Fairbanks, Alaska for
preparation and then on to ALS Chemex in Reno, Nevada or Vancouver, B.C. for
assay. ALS Chemexs quality system complies with the requirements for the
International Standards ISO 9001:2000 and ISO 17025:1999. Analytical accuracy
and precision are monitored by the analysis of reagent blanks, reference
material and replicate samples. Quality control is further assured by the use of
international and in-house standards. Finally, representative blind duplicate
samples are forwarded to ALS Chemex and an ISO compliant third party laboratory
for additional quality control.

---

- 44 -

**ITEM
6:**       **DIVIDENDS**

There
are no restrictions which prevent ITH from paying dividends. ITH has not paid
any dividends in the last three fiscal years. ITH has no present intention of
paying any dividends, as it anticipates that all available funds will be
invested to finance the growth of its business. The Board will determine if and
when dividends should be declared and paid in the future, based on ITHs
financial position at the relevant time.

**ITEM
7:**       **DESCRIPTION OF
CAPITAL STRUCTURE**

General Description of Capital Structure

The
authorized capital of ITH is 500,000,000 Common Shares, of which 86,683,919 were
issued as at December 31, 2011 and 86,683,919 were issued as at March 16, 2012.
The holders of Common Shares are entitled to receive notice of and attend all
meetings of shareholders, with each Common Share held entitling the holder to
one vote on any resolution to be passed at such shareholder meetings. The
holders of Common Shares are entitled to dividends if, as and when declared by
the Board. The Common Shares are entitled, upon liquidation, dissolution or
winding up of ITH, to receive the remaining assets of ITH available for
distribution to shareholders.

Shareholders Rights Plan

On
August 25, 2009, the Board adopted a Shareholders Rights Plan (SRP), to
become effective at 12:01 a.m. on August 26, 2009, subject to shareholder
approval being obtained on or before February 26, 2010 (obtained on October 15,
2009).

The
purpose of the SRP is to provide shareholders and the Board with adequate time
to consider and evaluate any unsolicited bid made for the Company, to provide
the Board with adequate time to identify, develop and negotiate value-enhancing
alternatives, if considered appropriate, to any such unsolicited bid, to
encourage the fair treatment of shareholders in connection with any take-over
bid for the Company and to ensure that any proposed transaction is in the best
interests of the Company's shareholders.

The
rights issued under the SRP will become exercisable only if a person, together
with its affiliates, associates and joint actors, acquires or announces its
intention to acquire beneficial ownership of shares which, when aggregated with
its current holdings, total 20% or more of the Companys outstanding Common
Shares (determined in the manner set out in the Shareholder Rights Plan), other
than by a Permitted Bid. Permitted Bids must be made by way of a take-over bid
circular prepared in compliance with applicable securities laws and, among other
conditions, must remain open for 60 days. If a take-over bid does not meet the
Permitted Bid requirements of the SRP, the rights will entitle shareholders,
other than any shareholder or shareholders making the take-over bid, to purchase
additional Common Shares at a substantial discount to the market price of the
Common Shares at that time.

Constraints

There
are no constraints imposed on the ownership of Common Shares to ensure that ITH
has any required level of Canadian ownership.

---

- 45 -

**ITEM
8:**       **MARKET FOR
SECURITIES**

The
Common Shares are listed and posted for trading on the TSX (symbol ITH), on
the NYSE-A (symbol THM), and on the Frankfurt Stock Exchange (symbol IW9).

Trading Price and Volume

The
following table provides information as to the high, low and closing prices of
the Common Shares on the TSX during the 7 months of the most recently completed
financial year and since the most recent financial year end, as well as the
volume of shares traded for each month:

Month
    High ($)
    Low ($)
    Close ($)
    VolumeMarch 1  15, 2012
    5.01
    4.35
    4.40
    1,800,180February, 2012
    5.52
    4.98
    5.02
    1,736,400January, 2012
    5.61
    4.42
    5.42
    2,149,900December, 2011
    5.18
    3.71
    4.43
    4,024,600November, 2011
    5.92
    4.67
    5.17
    6,158,800October, 2011
    5.71
    4.69
    5.02
    3,459,700September, 2011
    8.15
    5.08
    5.33
    4,033,000August, 2011
    8.45
    6.49
    7.93
    3,126,800July, 2011
    8.00
    7.03
    7.20
    2,503,200June, 2011
    8.24
    6.25
    7.28
    3,091,200


**ITEM
9:**       **ESCROWED
SECURITIES**

There
are no securities of the Company subject to escrow or subject to any contractual
restrictions on transfer.

**ITEM
10:**       **DIRECTORS AND
EXECUTIVE OFFICERS**

Name, Occupation and Security Holding

The
names, positions or offices held with ITH, province/state and country of
residence, and principal occupation over the last five years of the Directors
and executive officers of ITH, as at the date of this AIF, are as follows:

Name, Position and Province/State and
      Country of Residence(1)
    Principal Occupation During the
      Past 5 Years(1)
    
    Period of Service as an Officer
      or Director(2)James J. Komadina(5)(7)Director, CEO
      Colorado, USA
    Metallurgical Engineer; President and CEO and Director of
      the Company since June 1, 2011; previously President & COO, Brazauro
      Resources Ltd. (public mineral exploration company) 2009 - 2010; Senior
      V-P Project Development, Gold Fields Limited (public mining company), 2005
       2009; President & CEO, North America for AngloGold Limited,
      1999-2003, previously Executive VP and COO, Minorco/AngloGold North
      America (subsidiaries of public mining company), 1992-1999
    
    CEO and Director since June 1, 2011
      President since October 24, 2011


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- 46 -

|Name, Position and
      Province/State and Country of
      Residence(1)             | Principal Occupation During the
    Past 5 Years(1)                                                                                                                                                                                                                                                                                                                                                                                            |  | Period of Service as an
      Officer or Director(2)                                  
|------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------------------------------------------------------------------
|                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                                                                                       
|Jeffrey A. Pontius(5)(7)Director Colorado, USA                                        | Geologist; CEO and a director of Corvus Gold Inc. (public
      mineral exploration company) since August, 2010; President and CEO of the
      Company from September, 2006 to May, 2011; previously North American
      Exploration Manager for AngloGold Ashanti North America Inc. from 2004 to
      2006 and also a Director of Anglo American Exploration (Canada) Ltd.
      (subsidiaries of a public mining company), 1999 to 2006. |  | Director since June 1, 2011
      President and CEO September 22, 2006 to May 31, 2011
|                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                                                                                       
|Donald C.
      Ewigleben(3)(4)(6)Chairman of the Board, Director
      Colorado, USA | Lawyer; President and CEO of Uranium Resources, Inc.
      (public uranium mining company) since 2009; previously President and CEO
      of AngloGold Ashanti North America Inc. and other positions with AngloGold
      Ashanti Ltd. (public mining company), 2000 - 2009.                                                                                                                                                                  |  | Director since November 17, 2011                                                      
|                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                                                                                       
|Mark R. Hamilton(4)(5)(6)Director Alaska, USA                                         | Retired; U.S. Army Major General for 31 years of active
      military duty; previously president of the University of Alaska System
      from 1998 to 2011; previously Chief of Staff of the Alaskan Command at
      Elmendorf Air Force Base and Commander of Division Artillery at Fort
      Richardson; Director of Alaska Air Group Inc. (public aviation holding
      firm) from 2001 to 2011                                        |  | Director since November 17, 2011                                                      
|                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                                                                                       
|Roger R. Taplin(7)Director British Columbia, Canada                                   | Barrister & Solicitor; Partner, McCarthy Tétrault
      (law firm) since 2003; previously partner at Deneys Reitz Attorneys (law
      firm) in Johannesburg, South Africa, 1997 - 2003                                                                                                                                                                                                                                                        |  | Director since November 17, 2011                                                      
|                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |                                                                                       
|Jonathan A. Berg Director New
      York, USA                                         | Businessman; Director, Scorpio Mining Corporation (public
      mining company) , 2011 to present; previously director and non-executive
      chairman at Colombia Goldfields Ltd. (public mineral exploration company),
      December 2007  November 2009; Vice-president, Finance, of PeriCor
      Therapeutics Inc. (private, clinical-stage specialty biopharmaceutical
      company), April 2005  May 2010                          |  | Director since January 10, 2012                                                       

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- 47 -

|Name, Position andProvince/State and Country ofResidence(1)                         | Principal OccupationDuring the
    Past 5 Years(1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |  | Period of Service as anOfficer or Director(2)                                                                 
|----------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------------------------------------------------------------------------------------------
|                                                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |  |                                                                                                               
|Anton J. Drescher(3)Director British Columbia, Canada                               | Businessman, Certified Management Accountant; President,
      Harbour Pacific Capital Corp. (private management company) since 1998;
      President, Westpoint Management Consultants Limited (private management
      company) since 1979, Director of Dorato Resources Inc. (public natural
      resource company), 1996 to present; Director of Trevali Mining Corporation
      (public natural resources company) since 2007; Director and CFO of USA
      Video Interactive Corp. (public video streaming company) since 1994. |  | Director since August, 1991
      President, 1991  September 22, 2006                                        
|                                                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |  |                                                                                                               
|Daniel A. Carriere(4)(5)(6)(7)Director British Columbia, Canada                     | Businessman; Self-employed; previously, Senior Vice
      President, Corriente Resources Inc. (public mineral exploration company),
      1996  2010; Director, ID Biomedical Inc. (public biomedical company) 1995
       2005                                                                                                                                                                                                                                                                                                         |  | Director since April 14, 2010                                                                                 
|                                                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |  |                                                                                                               
|Timothy J. Haddon(3)(7)Director Colorado, USA                                       | Mining Engineer; President, CEO and a director of
      International Natural Resource Management Co. (private mining industry
      consulting service provider and investor) since 2002; Director, Alacer
      Gold Corporation (public gold mining company, formerly Anatolia Minerals
      Development Ltd.) since 1998, also Chairman from 2003 to February, 2011
      and since August 2011; Lead Director, Thompson Creek Metals Company Inc.
      (a mineral exploration and development company) since 2007.               |  | Director since April 14, 2010                                                                                 
|                                                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |  |                                                                                                               
|Robert D. ComerChief
      Administrative Officer and General Counsel Colorado, USA | Lawyer; Chief Administrative Officer and General Counsel
      of the Company since January 1, 2012, previously Counsel, Faegre &
      Benson (law firm) February 2010  January 1, 2012; Associate Solicitor for
      Minerals, Land and Water, Regional Solicitor and Counselor to the
      Solicitor for the Department of the Interior, 2002 to January 2010                                                                                                                                                                       |  | Chief Administrative Officer and
      General Counsel since January 1, 2012                                  
|                                                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |  |                                                                                                               
|Lawrence W. Talbot(7)Vice-President British Columbia, Canada                        | Barrister and Solicitor; Owner, Lawrence W. Talbot Law
      Corporation (law firm) since July 1, 2006, previously Partner, Gowling
      Lafleur Henderson LLP (law firm), April 2000 to July 2006                                                                                                                                                                                                                                                                                                                                       |  | Vice-President since September
      22, 2006 General Counsel from September 22, 2006 to January 1,
      2012
|                                                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |  |                                                                                                               
|Tom S. Q. YipChief Financial
      Officer Colorado, USA                            | Chartered Accountant; Chief Financial Officer of the
      Company since September, 2011, previously, Chief Financial Officer for
      Silver Standard Resources Inc. (public silver mining company), 2007 
      August, 2011; Chief Financial Officer for Asarco, LLC (public mining
      company), 2006 to 2007                                                                                                                                                                                                                     |  | Chief Financial Officer since
      September 7, 2011                                                         

---

- 48 -

|Name, Position and
      Province/State and Country of
      Residence(1)            | Principal Occupation During the
    Past 5 Years(1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |  | Period of Service as an
      Officer or Director(2)                
|------------------------------------------------------------------------------------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | --------------------------------------------------------------------
|                                                                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |                                                                     
|Shirley Zhou Vice-President,
      Corporate Communications British Columbia, Canada | Corporate Communications Professional: Vice- President,
      Corporate Communications of the Company since November, 2010; previously
      Manager, Corporate Communications, for the Company August 2010  November
      2010; Manager, Corporate Communications, Silvercorp Metals Inc. (public
      silver mining company) August 2008  August 2010; Investor Relations
      Officer, Solex Resources Corp. (public mineral exploration company), June
      2006  June 2008; Investor Relations, Minco Silver Corporation (public
      mineral exploration company), March 2005  June 2006 |  | Vice-President, Corporate
      Communications since November , 2010

Notes:

|1. | The information as to place of residence and principal
      occupation, not being within the knowledge of ITH, has been furnished by
      the respective Directors individually.                      
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                         
|2. | All directorships expire at the next Annual General
      Meeting of the shareholders of ITH (which must be held before December 31,
      2012). All officers hold office at the pleasure of the Board.
|   |                                                                                                                                                                                                         
|3. | Denotes member of the Audit Committee.                                                                                                                                                                  
|   |                                                                                                                                                                                                         
|4. | Denotes member of the Compensation Committee.                                                                                                                                                           
|   |                                                                                                                                                                                                         
|5. | Denotes member of the Health, Occupational Safety and
      Environmental Committee.                                                                                                                    
|   |                                                                                                                                                                                                         
|6. | Denotes member of the Nominating and Corporate Governance
      Committee.                                                                                                                              
|   |                                                                                                                                                                                                         
|7. | Denotes member of the Mergers and Acquisitions
      Committee.                                                                                                                                         

ITH
does not currently have any committees other than the Audit Committee, the
Compensation Committee, the Nominating and Corporate Governance Committee, the
Health, Occupational Safety and Environmental Committee and the Mergers and
Acquisitions Committee.

As
at March 16, 2012, ITHs Directors and executive officers, as a group,
beneficially hold a total of 1,711,739 Common Shares, directly or indirectly,
representing 1.97% of the 86,683,919 issued Common Shares. ITHs Directors and
executive officers, as a group, also hold the following incentive stock options
to purchase up to the following numbers of Common Shares until the dates shown:

| | (a) | 1,175,000 Common Shares exercisable at $7.34 per Common
      Share until April 14, 2012;                                    
| | --- | -----------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                              
| | (b) | 600,000 Common Shares exercisable at $6.57 per Common
      Share until August 19, 2012;                                     
| |     |                                                                                                                              
| | (c) | 25,000 Common Shares exercisable at $9.15 per Common
      Share until January 10, 2013;                                     
| |     |                                                                                                                              
| | (d) | 500,000 Common Shares exercisable at $7.47 per Common
      Share until July 28, 2013;                                       
| |     |                                                                                                                              
| | (e) | 1,000,000 Common Shares exercisable at $8.35 per Common
      Shares until May 9, 2016 (subject to vesting provisions);      
| |     |                                                                                                                              
| | (f) | 600,000 Common Shares exercisable at $8.07 per Common
      Shares until August 23, 2016 (subject to vesting provisions);
and
| |     |                                                                                                                              
| | (g) | 650,000 Common Shares exercisable at $4.43 per Common
      Shares until January 3, 2017 (subject to vesting
  provisions).  

---

- 49 -

Cease Trade Orders, Bankruptcies, Penalties or Sanctions

|1. | No Director or executive officer of ITH is, as at the
      date of this AIF, or was within ten years before the date of this AIF, a
      director, chief executive officer or chief financial officer of any
      company (including ITH) that:
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                   
|   | (a)                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                   
|   | (b)                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                   
|   | For the purposes hereof, the term order
    means:                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                   
|   | (a)                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                   
|   | (b)                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                   
|   | (c)                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                   
|   | that was in effect for a period of more than 30
    consecutive days.                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                   
|2. | No Director or executive officer of ITH, or a shareholder
      holding a sufficient number of securities of ITH to affect materially the
      control of ITH:                                                                                   
|   |                                                                                                                                                                                                                                                   
|   | (a)                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                   
|   | (b)                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                   
|3. | No Director or executive officer of ITH, or a shareholder
      holding a sufficient number of securities of ITH to affect materially the
      control of ITH, has been subject to:                                                              
|   |                                                                                                                                                                                                                                                   
|   | (a)                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                   
|   | (b)                                                                                                                                                                                                                                               

---

- 50 -

Conflicts of Interest

Certain
Directors and officers of ITH are directors, officers and/or shareholders of
other private and publicly listed companies, including companies that engage in
mineral exploration and development and companies that hold Common Shares or
other securities of ITH. To the extent that such other companies may participate
in or be affected by ventures involving ITH, these Directors and officers of ITH
may have conflicting interests in negotiating, settling and approving the terms
of such ventures. Conflicts of interest affecting the Directors and officers of
ITH will be governed by ITHs Code of Business Conduct and Ethics, the
Articles of ITH, the provisions of the BCBCA and other applicable laws and
relevant stock exchange policies and requirements. In the event that such a
conflict of interest arises at a meeting of the Directors, a Director affected
by the conflict must disclose the nature and extent of his interest and abstain
from voting for or against matters concerning the matter in respect of which the
conflict arises.

**ITEM
11:**       **PROMOTERS**

ITH
does not presently have, and has not within the two most recently completed
fiscal years or the current fiscal year had, any promoters.

**ITEM
12:**       **LEGAL PROCEEDINGS
AND REGULATORY ACTIONS**

Legal Proceedings

The
Company is not currently, and has not since June 1, 2011 (being the commencement
of the Companys last competed financial year) been, a party to any legal
proceedings, nor is any of the Companys properties presently, or has, since
June 1, 2011 (being the commencement of the Companys last competed financial
year), any of the Companys properties been, subject to any legal proceedings.

Regulatory Actions

|   | There have not been any:                                                                                                                                                                                                                                         
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                  
|1. | penalties or sanctions imposed against ITH by a court
      relating to securities legislation or by a securities regulatory authority
      during the financial year ended December 31, 2011;                                                                  
|   |                                                                                                                                                                                                                                                                  
|2. | any other penalties or sanctions imposed against ITH by a
      court relating to securities legislation or by a securities regulatory
      authority that would likely be considered important to a reasonable
      investor making an investment decision; or
|   |                                                                                                                                                                                                                                                                  
|3. | settlement agreements entered into by ITH before a court
      relating to securities legislation or with a securities regulatory
      authority during the financial year ended December 31,
  2011.                                                           

**ITEM
13:**       **INTEREST OF
MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS**

|   | No:                                                                                                                                                                     
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                         
|1. | Director or executive officer of the Company;                                                                                                                           
|   |                                                                                                                                                                         
|2. | any person or company that is the direct or indirect
      beneficial owner of, or who exercises control or direction over, more than
      10% of the Common Shares; or
|   |                                                                                                                                                                         
|3. | any associate or affiliate of any of the persons or
      companies referred to in paragraphs 1 or 2,                                                                   

---

- 51 -

has, during any of the fiscal years ended December 31, 2011,
May 31, 2011 or 2010, or during the current fiscal year, had any material
interest, direct or indirect, in any transaction that has materially affected,
or will materially affect, the Company, except for:

|1. | Pursuant to an Asset Purchase and Sale and Indemnity
      Agreement dated June 30, 2006, as amended on July 26, 2006 (collectively,
      the AngloGold Agreement) among ITH, AngloGold and Tower Alaska,
      AngloGold has the right to maintain its percentage equity interest in the
      Common Shares, on an ongoing basis, provided that such right will
      terminate if AngloGolds interest falls below 10% at any time after
      January 1, 2009. As a consequence of the exercise of this top-up right,
      ITH has, subsequent to the fiscal year ended May 31, 2009, issued Common
      Shares to AngloGold on a private placement basis, as follows:
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|2. | On April 6, 2010, the Company issued an aggregate of
      664,210 common shares for aggregate gross proceeds of CAD 3,985,260 to
      AngloGold under its preferential right to participate in a private
      placement of an aggregate of 5,000,000 shares in accordance with its then
      current equity interest in the Company. The price paid by AngloGold
      ($6.00) was the same as the other arms length placees who participated in
      the placement.                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|3. | On November 10, 2010, the Company issued an aggregate of
      754,765 common shares for aggregate gross proceeds of CAD 4,717,282 to
      AngloGold under its preferential right to participate in an equity
      offering of an aggregate of 16,860,000 shares. The price paid by AngloGold
      ($6.25) was the same as the other arms length placees who participated in
      the placement.                                                                                                                                                                                                                                                                            

**ITEM
14:**       **TRANSFER AGENT
AND REGISTRAR**

The
Companys co-transfer agents and registrars are Computershare Investor Services
Inc. in Canada and Computershare Trust Company N.A. in the United States.
Transfers may be effected at, and registration facilities are maintained in British Columbia,
Canada at 3rd Floor, 510 Burrard Street, Vancouver, British Columbia,
V6C 3B9.

---

- 52 -

**ITEM
15:**       **MATERIAL
CONTRACTS**

There
are no material contracts that have been entered into by the Company other than
in the ordinary course of the Companys business of mineral property evaluation,
acquisition and divestiture and exploration, including raising the funding
therefor, since June 1, 2011 (being the commencement of the Companys most
recently completed financial year) that are still in effect, other than:

|1. | Shareholder Rights Plan Agreement dated August 25, 2009
      between ITH and Computershare Investor Services Inc. pursuant to which ITH
      issued the rights pursuant to the SRP.                                                                                                                                                                                                                
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                       
|2. | Arrangement Agreement made as of July 8, 2010 between ITH
      and Corvus pursuant to which ITH and Corvus agreed to carry out the
      spin-out arrangement transaction described under Item 5  Narrative
      Description of the Business  Corporate Reorganizations.                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                       
|3. | Stock and Asset Purchase Agreement made effective as at
      December 13, 2011 among Tower Alaska, Alaska/Nevada Gold Mines Ltd.
      Heflinger Mining & Equipment Company, Carl Heflinger and Fred
      Heflinger with respect to the acquisition of certain placer mining claims
      and related rights in the vicinity of the Livengood Project, and including
      all of the shares of LPI.
|   |                                                                                                                                                                                                                                                                                                                                                                                                       
|4. | Lease Amendment, Option Exercise, and Purchase and Sale
      Agreement by and among Karl Hanneman, VMC Revocable Trust and Tower Alaska
      dated as of December 13, 2011 with respect to of the exercise of an
      existing lease buyout option with respect to certain mining claims leased
      by the Company and forming part of the Livengood
Project.                                    

**ITEM
16:**       **NAMES AND
INTERESTS OF EXPERTS**

Names and Interests of Experts

The following are the persons or companies:

|1. | who were named as having prepared or certified a
      statement, report or valuation described or included in a filing, or
      referred to in a filing, made under National Instrument 51-102 by ITH
      during, or relating to, the fiscal year ending December 31, 2011, being
      ITHs most recently completed financial year; and
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                              
|2. | whose profession or business gives authority to the
      statement, report or valuation made by the person or company:                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                              
|   | (a)                                                                                                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                              

MacKay LLP is independent in
accordance with the auditors rules of professional conduct in British Columbia;

---

- 53 -

| | (b) | William Pennstrom, Jr., QPMMSA, SME, a qualified person
      for the purposes of NI 43- 101, is the author responsible for the
      preparation of sections 13, 17 and 22 (and the corresponding parts of
      sections 1 and 25) of the Livengood Report. Mr. Pennstrom holds less than
      1% of the outstanding Common Shares;                                                                                                                         
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (c) | Tim Carew, P.Geo., a qualified person for the purposes
      of NI 43-101, is the author responsible for the preparation of section 14
      (and the corresponding parts of sections 1 and 25) of the Livengood
      Report. Mr. Carew holds less than 1% of the outstanding Common
    Shares;                                                                                                                                                              
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (d) | Carl E. Brechtel, P.E., a qualified person for the
      purposes of NI 43-101 is the author responsible for the preparation of
      sections 2, 3, 15, 18, 19, 20, 21, 24, 26 and 27 and the corresponding
      parts of sections 1 and 25 of the Livengood Report. At the time of the
      preparation of the Livengood Report, Mr. Brechtel was an employee of the
      Company. Mr. Brechtel holds less than 1% of the outstanding Common
      Shares;
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (e) | Russell Myers, CPG, a qualified person for the purposes
      of NI 43-101 is the author responsible for the preparation of sections
      11.6 and 12 and the corresponding parts of sections 1 and 25 of the
      Livengood Report. Mr. Myers holds less than 1% of the outstanding Common
      Shares;                                                                                                                                                    
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (f) | Chris Puchner, CPG, a qualified person for the purposes
      of NI 43-101 is the author responsible for the preparation of sections 4,
      5, 6, 7, 8, 9, 10, 11.1, 11.2, 11.3, 11.4, 11.5 and 23 and the
      corresponding parts of sections 1 and 25 of the Livengood Report. Mr.
      Puchner is an employee of the Company. Mr. Puchner holds less than 1% of
      the outstanding Common Shares; and                                               
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (g) | Scott E. Wilson, SME, a qualified person for the
      purposes of NI 43-101, is the author responsible for the preparation of
      section 16 and the corresponding parts of sections 1 and 25 of the
      Livengood Report. Mr. Wilson holds less than 1% of the outstanding Common
      Shares.                                                                                                                                                          

**ITEM
17:**       **ADDITIONAL
INFORMATION**

Audit Committee Information

Under
National Instrument 52-110  Audit Committees (NI 52-110), companies that are
required to file an Annual Information Form are required to provide certain
disclosure with respect to their audit committee, including the text of the
audit committees charter, the composition of the audit committee and the fees
paid to the external auditor. This information with respect to ITH is provided
in Schedule A.

Additional Information

Additional
information relating to ITH may be found on SEDAR at www.sedar.com.

Additional information, including
  directors and officers remuneration and indebtedness, principal holders of
  ITHs securities and securities authorized for issuance under equity
  compensation plans, if applicable, is contained in the Information Circular.
  Additional financial information is available in ITHs comparative audited
  consolidated financial statements, together with the auditors report thereon,
  and the related Management Discussion and Analysis for its most recently
  completed fiscal year ended December 31, 2011.

---

- 54 -

A
copy of this AIF, the Information Circular, the Financial Statements and the
MD&A, as well as any interim statements from the past fiscal year) may be
found on the SEDAR website at www.sedar.com or
be obtained upon request from the Vice-President of ITH. A reasonable fee for
copying may be charged if the request is made by a person who is not a
registered security holder of ITH.

---

Schedule A

Audit Committee Information

The Audit Committees Charter

The following is the text of the current Charter for ITHs Audit Committee:

INTERNATIONAL TOWER HILL MINES LTD.

AUDIT COMMITTEE CHARTER

(Adopted by the Board of Directors on September 22, 2006 and
amended on June 28, 2007)

ARTICLE 1 - PURPOSE

The overall purpose of the Audit Committee (the Committee) is to:

| | (a) | ensure that the management of International Tower Hill
      Mines Ltd. (the Company) has designed and implemented an effective
      system of internal financial controls for reviewing and reporting on the
      Companys financial statements;
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                       
| | (b) | oversee, review and report on the integrity of the
      Companys financial disclosure and reporting;                                                                                                                                                
| |     |                                                                                                                                                                                                                                                       
| | (c) | review the Company's compliance with regulatory and
      statutory requirements as they relate to financial statements, taxation
      matters and disclosure of material facts; and                                                                 
| |     |                                                                                                                                                                                                                                                       
| | (d) | be directly responsible for:                                                                                                                                                                                                                          
| |     |                                                                                                                                                                                                                                                       
| |     | (i)                                                                                                                                                                                                                                                   
| |     |                                                                                                                                                                                                                                                       
| |     | (ii)                                                                                                                                                                                                                                                  
| |     |                                                                                                                                                                                                                                                       
| |     | (iii)                                                                                                                                                                                                                                                 

ARTICLE 2 - COMPOSITION, PROCEDURES AND ORGANIZATION

|2.1 | The Committee will consist of at least three members of
      the Board of Directors (the Board), all of whom will be independent
      and unrelated directors of the Company within the meaning of all
      applicable legal and regulatory requirements (except in the circumstances,
      and only to the extent, permitted by all applicable legal and regulatory
      requirements).                                                                                                                                                                                                                                                                   
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|2.2 | All of the members of the Committee will be financially
      literate, at least one member of the Committee will have accounting or
      related financial expertise (i.e. able to analyze and interpret a full set
      of financial statements, including the notes thereto, in accordance with
      generally accepted accounting principles) and at least one member of the
      Committee will be a financial expert within the meaning of the rules and
      forms adopted by the Securities and Exchange Commission (except in the
      circumstances, and only to the extent, permitted by all applicable legal
      and regulatory requirements).
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|2.3 | The Board, at its organizational meeting held in
      conjunction with each annual general meeting of the shareholders, will
      appoint the members of the Committee for the ensuing year. The Board may
      at any time remove or replace any member of the Committee and may fill any
      vacancy in the Committee.                                                                                                                                                                                                                                                                                                                                         

---

|2.4 | Unless the Board has appointed a chair of the Committee,
      the members of the Committee will elect a chair from among their
      number.                                                                                                                                                                                                                                                                                                                    
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|2.5 | The Committee will select an individual to act as
      secretary for the Committee, who will be either:                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|2.6 | The quorum for meetings will be a majority of the members
      of the Committee, present in person or by telephone or other
      telecommunication device that permits all persons participating in the
      meeting to speak and to hear each other. Decisions by the Committee will
      be by the affirmative vote of a majority of the members of the Committee,
      or by consent resolutions in writing signed by each member of the
      Committee.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|2.7 | The Committee will have access to such officers and
      employees of the Company and to the Company's external auditors, and to
      such information respecting the Company, as it considers to be necessary
      or advisable in order to perform its duties and
responsibilities.                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|2.8 | Meetings of the Committee will be conducted as
      follows:                                                                                                                                                                                                                                                                                                                                                                                                    

| | (a) | the Committee will meet:
| | --- | ------------------------
| |     |                         
| |     | (i)                     
| |     |                         
| |     | (ii)                    
| |     |                         
| |     |                         
| |     |                         
| |     |                         

| |     | in each case at such times and at such locations as may
      be determined by the Committee or the chair of the Committee. Except in
      respect of a regularly scheduled meeting of the Committee, notice of such
      meeting, together with a proposed agenda, will be delivered to each member
      of the Committee not less that forty-eight (48) hours prior to the
      proposed meeting time (which notice may be waived by all of the members of
      the Committee); and
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | (b) | the external auditors and management representatives will
      be invited to attend as necessary in the discretion of the
    Committee.                                                                                                                                                                                                                                                                                                                                                 

|2.9  | The internal accounting staff, any external accounting
      consultant(s) and the external auditors will have a direct line of
      communication to the Committee through its chair and may bypass management
      if deemed necessary. The Committee, through its chair, may contact
      directly any employee in, or consultant of, the Company as it deems
      necessary, and any employee of, or consultant to, the Company may bring
      before the Committee any matter involving questionable, illegal or
      improper financial practices or transactions.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|2.10 | The Committee may, in its sole discretion, retain, at the
      expense of the Company, such legal, financial or other advisors or
      consultants as it may deem necessary or advisable in order to properly and
      fully perform its duties and responsibilities
hereunder.                                                                                                                                                                                                                                                                                            

ARTICLE 3 - DUTIES AND RESPONSIBILITIES

|3.1 | The overall duties and responsibilities of the Committee
      will be as follows:
|--- | ----------------------------------------------------------------------------------

---

- 3 -

| | (a) | be directly responsible for:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     | (iii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | (b) | to review with the management of the Company (and, in the
      case of the annual audited statements, with the external auditors) the
      annual audited consolidated and unaudited consolidated quarterly financial
      statements, including the notes thereto, to ensure that such statements
      present fairly the financial position of the Company and the results of
      its operations and, if appropriate, to recommend to the Board as to the
      approval of any such financial statements;
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | (c) | to assist the Board in the discharge of its
      responsibilities relating to the Companys accounting principles,
      reporting practices and internal controls and its approval of the
      Company's annual and quarterly consolidated financial
statements;                                                                                                                                                                                                                                               
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | (d) | to establish and maintain a direct line of communication
      with the Company's internal accounting staff and any external accounting
      consultant(s) and assess their performance;                                                                                                                                                                                                                                                                                                                         
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | (e) | to ensure that the management of the Company has
      designed, implemented and is maintaining an effective and appropriate
      system of internal financial controls; and                                                                                                                                                                                                                                                                                                                                     
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
| | (f) | to report regularly to the Board on the fulfilment of its
      duties and responsibilities.                                                                                                                                                                                                                                                                                                                                                                                                                      

|3.2 | The duties and responsibilities of the Committee as they
      relate to the external auditors will be as follows:
|--- | ------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                   
|    | (a)                                                                                                               
|    |                                                                                                                   
|    | (b)                                                                                                               
|    |                                                                                                                   
|    | (c)                                                                                                               
|    |                                                                                                                   
|    | (d)                                                                                                               
|    |                                                                                                                   
|    | (e)                                                                                                               
|    |                                                                                                                   
|    | (f)                                                                                                               

---

- 4 -

| | (g) | obtain confirmation from the external auditors of the
      Company that they will ensure that all reports filed under the United
      States Securities Exchange Act of 1934, as amended, which contain
      financial statements required to be prepared in accordance with Canadian
      GAAP and/or are reconciled to, United States GAAP, reflect all material
      correcting adjustments identified by the external auditors of the
      Company;      
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | (h) | to review and approve the Companys hiring policies
      regarding partners, employees and former partners and employees of the
      present and any former external auditors of the Company;                                                                                                                                                                                                                                                                    
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | (i) | to review and pre-approve all non-audit services to be
      provided to the Company (or any of its subsidiaries) by the external
      auditors, provided that such pre-approval authority may be delegated by
      the Committee to any member of the Committee who is independent and
      unrelated on the condition that any such pre-approval must be presented
      to the Committee at its first schedule meeting following any such
      approval;
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | (j) | review the audit plan of the external auditors prior to
      the commencement of the audit;                                                                                                                                                                                                                                                                                                                                                                       
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
| | (k) | to review with the external auditors, upon completion of
      their annual audit:                                                                                                                                                                                                                                                                                                                                                                                 

| | (i)    | the contents of their report,                                                                                                                                    
| | ------ | -----------------------------------------------------------------------------------------------------------------------------------------------------------------
| |        |                                                                                                                                                                  
| | (ii)   | the scope and quality of the audit work
  performed,                                                                                                             
| |        |                                                                                                                                                                  
| | (iii)  | the adequacy of the Company's financial and accounting
      personnel,                                                                                          
| |        |                                                                                                                                                                  
| | (iv)   | the co-operation received from the Company's personnel
      and any external consultants during the audit,                                                      
| |        |                                                                                                                                                                  
| | (v)    | the scope and nature of the internal resources
    used,                                                                                                         
| |        |                                                                                                                                                                  
| | (vi)   | any significant transactions outside of the normal
      business of the Company,                                                                                
| |        |                                                                                                                                                                  
| | (vii)  | any significant proposed adjustments and recommendations
      for improving internal accounting controls, accounting principles or
      management systems, and
| |        |                                                                                                                                                                  
| | (viii) | the non-audit services provided by the external auditors
      during the year under audit;                                                                      

| | (l) | to discuss with the external auditors not just the
      acceptability, but also the quality, of the Companys accounting
      principles; and             
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                             
| | (m) | to implement structures and procedures to ensure that the
      Committee meets the external auditors on a regular basis in the absence of
      management.

|3.3 | The duties and responsibilities of the Committee as they
      relate to the internal control procedures of the Company are to:
|--- | -------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                
|    | (a)                                                                                                                            
|    |                                                                                                                                
|    |                                                                                                                                

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- 5 -

| | (ii)  | effective internal control systems, and                                                                                                                  
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------
| |       |                                                                                                                                                          
| | (iii) | adequate processes for assessing the risk of material
      misstatement of the financial statements and for detecting control
      weaknesses or fraud;

| | (b) | establish procedures for:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |     | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| |     | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (c) | to periodically review this policy and recommend to the
      Board any changes which the Committee may deem appropriate;                                                                                                                                                                                                                                                                                                                                                                                                                        
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (d) | review any unresolved issues between management and the
      external auditors that could affect the financial reporting or internal
      controls of the Company;                                                                                                                                                                                                                                                                                                                                                                             
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (e) | periodically review the Company's financial and auditing
      procedures and the extent to which recommendations made by the internal
      accounting staff, by any external accounting consultant(s) or by the
      external auditors have been implemented;                                                                                                                                                                                                                                                                                 
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (f) | assist in the preparation of any internal control report
      by management, which provides that management of the Company is
      responsible for establishing and maintaining an adequate control structure
      and procedures for financial reporting by the Company, assessing the
      effectiveness of such control structure and procedures, and ensuring that
      the external auditors of the Company attest to, and report on, the
      assessment of such control structure and procedures by management of the
      Company;
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (g) | assist the Chief Executive Officer and the Chief
      Financial Officer of the Company in their assessment of the effectiveness
      of the Companys internal control over financial reporting and in
      determining whether there has been any material change in the Companys
      internal control over financial reporting which has materially affected or
      could materially affect such internal control subsequent to the date of
      the evaluation; and                                                                  
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | (h) | assist the Chief Executive Officer and the Chief
      Financial Officer of the Company in identifying and addressing any
      significant deficiencies or material weaknesses in the design or operation
      of the Companys internal control over financial information and any
      fraud, whether or not material, that involves management or other
      employees who have a significant role in the Companys internal control
      over financial reporting.                                                                      

|3.4 | The Committee is also charged with the responsibility
      to:
|--- | ---------------------------------------------------------------
|    |                                                                
|    | (a)                                                            
|    |                                                                
|    | (b)                                                            
|    |                                                                
|    |                                                                
|    |                                                                
|    |                                                                
|    |                                                                
|    |                                                                
|    |                                                                
|    |                                                                

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- 6 -

| | (v) | other public reports requiring approval by the
    Board,
| | --- | ---------------------------------------------------------

| |     | and report to the Board with respect thereto including,
      without limitation, as to the approval (or otherwise) thereof by the
      Board;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | (c) | review regulatory filings and decisions as they relate to
      the Company's consolidated annual and interim financial statements,
      including any press releases with respect thereto;                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | (d) | ensure that the Company discloses in the periodic reports
      of the Company, as appropriate, whether at least one member of the
      Committee is a financial expert within the meaning of the rules and
      forms adopted by the Securities and Exchange Commission;                                                                                                                                                                                                                                                                                                                                                                                           
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | (e) | ensure that all non-audit services approved by or on
      behalf of the Committee are disclosed in the periodic reports of the
      Company;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | (f) | ensure that each annual report and, to the extent
      required by any applicable legal or regulatory requirement, any quarterly
      report of the Company includes disclosure with respect to all material
      off-balance sheet transactions, arrangements, obligations (including
      contingent obligations) and other relationships of the Company with
      unconsolidated entities which may have a current or future effect on the
      Company in accordance with all applicable legal and regulatory
      requirements;                                                                                                                             
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | (g) | ensure that all financial statements and other financial
      information, including pro forma financial information, included in any
      report filed by the Company with any regulatory authority or contained in
      any public disclosure or press release of the Company is presented in a
      manner which does not contain a material misstatement or omission and
      reconciles the pro forma information contained therein to Canadian GAAP,
      and if appropriate, reconciles such pro forma information contained
      therein to United States GAAP, and which otherwise complies with all
      applicable legal and regulatory requirements;
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | (h) | review the appropriateness of the policies and procedures
      used in the preparation of the Company's consolidated financial statements
      and other required disclosure documents, and consider recommendations for
      any material change to such policies;                                                                                                                                                                                                                                                                                                                                                                                                  
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | (i) | review and report on the integrity of the Companys
      consolidated financial statements;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | (j) | review the minutes of any audit committee meeting of any
      subsidiaries of the Company;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | (k) | review with management, the external auditors and, if
      necessary, with legal counsel, any litigation, claim or other contingency,
      including tax assessments that could have a material effect upon the
      financial position or operating results of the Company and the manner in
      which such matters have been disclosed in the consolidated financial
      statements;                                                                                                                                                                                                                                                                           
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | (l) | review the Companys compliance with regulatory and
      statutory requirements as they relate to financial statements, tax matters
      and disclosure of material facts; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | (m) | develop a calendar of activities to be undertaken by the
      Committee for each ensuing year and to submit the calendar in the
      appropriate format to the Board within a reasonable time following each
      annual general meeting of shareholders.                                                                                                                                                                                                                                                                                                                                                                                                            

|3.5 | The Committee shall have the authority to
    determine:
|--- | --------------------------------------------------------
|    |                                                         
|    | (a)                                                     

---

- 7 -

| | (b) | the compensation to be received by any legal, financial
      or other advisors or consultants engaged by the Committee to assist it in
      performing its duties and responsibilities hereunder; and
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                        
| | (c) | the appropriate funding for the ordinary administrative
      expenses of the Committee.                                                                                                               

ARTICLE 4  GENERAL

|4.1 | The Committee will:                                                                                                                                                                                                                                  
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                      
|    | (a)                                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                      
|    | (b)                                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                      
|    | (c)                                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                      
|    | (d)                                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                      
|4.2 | No member of the Committee will receive any compensation
      from the Company, other than fees for being a director of the Company, or
      a member of a committee of the Board.                                                                 
|    |                                                                                                                                                                                                                                                      
|4.3 | In addition to the foregoing, the Committee will perform
      such other duties as may be assigned to it by the Board from time to time
      or as may be required by any applicable stock exchanges, regulatory
      authorities or legislation.

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- 8 -

Composition of the Audit Committee

ITHs Audit Committee is made up of the following directors:

|Name                      | Independent (Y/N) | Status              
|------------------------- | ----------------- | --------------------
|                          |                   |                     
|Anton J. Drescher (Chair) | Independent       | Financially Literate
|                          |                   |                     
|Timothy J. Haddon         | Independent       | Financially Literate
|                          |                   |                     
|Donald C. Ewigleben       | Independent       | Financially Literate

A member of an audit committee is independent if the member has
no direct or indirect material relationship with the Company that could, in the
view of the Board, be reasonably expected to interfere with the exercise of a
members independent judgment.

An individual is financially literate if he has the ability to
read and understand a set of financial statements that present a breadth and
level of complexity of accounting issues that are generally comparable to the
breadth and complexity of the issues that can reasonably be expected to be
raised by the Companys financial statements.

Relevant Education And Experience

The
experience and education of each member of the Audit Committee that is relevant
to the performance of his responsibilities as a member of the Audit Committee is
as follows:

Anton J Drescher: Mr. Drescher has been
Chief Financial Officer and a director of USA Video Interactive Corp., a public
company listed for trading on the TSXV and the OTC Bulletin Board, since
December 1994, which company is involved in streaming video and video-on-demand.
He has also been the President of Westpoint Management Consultants Limited, a
private company engaged in tax and accounting consulting for business
reorganizations, since 1979; and President of Harbour Pacific Capital Corp., a
private British Columbia company involved in regulatory filings for businesses
in Canada, since 1998. Mr. Drescher has been a Certified Management Accountant
since 1981.

Donald C Ewigleben: Mr. Ewigleben is a lawyer
with 35 years of experience in the mining industry overseeing legal, regulatory,
environmental and government affairs. He is currently the President and Chief
Executive Officer of Uranium Resources, Inc., a uranium producer with ISR mining
projects in the state of Texas. Previously, he was President and Chief Executive
Officer of AngloGold Ashanti North America and served as the Executive Officer 
Sustainability & Legal Affairs for AngloGold Ashanti in the Americas. Mr.
Ewigleben served as the Executive Officer  Law, Safety, Health &
Environment for AngloGold Ashanti Ltd. in Johannesburg, South Africa in 2006 and
2007. Prior to becoming the CEO of AngloGold in 2004, Mr. Ewigleben served as
President and CAO and as Vice President and General Counsel. Before joining
AngloGold in 2000, he was the Vice President, Environmental and Public Affairs,
for Echo Bay Mines. Prior to AngloGold and Echo Bay, Mr. Ewigleben served in
various capacities for AMAX Gold and AMAX Coal Industries. He began his career
as a governmental affairs representative for AMAX in Washington, DC and multiple
state legislatures. Mr. Ewigleben has served on the Board of Directors for the
National Mining Association, the Gold Institute, the Mining Association of
Canada, numerous state and provincial coal and hard-rock mining associations and
as a trustee of the Northwest Mining Association, the Eastern Mineral Law
Foundation and the Rocky Mountain Mineral Law Foundation and has had experience
with the review and understanding of the accounting principles relevant to the
financial statements of public natural resource companies.

Timothy J Haddon: Mr. Haddon is currently the
President, Chief Executive Officer, a director and 50% owner of International
Natural Resource Management Co., a private company which invests in and provides consulting services to the mining industry. He has
held those positions since 2002. He is also Chairman of the Board of Directors
of Alacer Gold Corp., a gold mining company listed on the Toronto and Australian
Stock Exchanges. He has been a director of that company (previously named
Anatolia Minerals Development Limited) since September 1998 and Chairman from
May 2003 to February 2011 and again since August 2011. Since 2007, Mr. Haddon
has also served as lead director of Thompson Creek Metals Co.. From August 2006
until September 2007, Mr. Haddon also served as a director of NewWest Gold
Corporation and from October 2005 until May 2007 he served as director of
Ascendant Copper Corporation. From October 1997 to December 2002, he served as
President and Chief Executive Officer of Archangel Diamond Corporation. From
April 1994 to June 1997, he held various positions with First Dynasty Mines
Ltd., the latest being Chairman and Chief Executive Officer, and, from June 1989
to March 1994, he served as President and Chief Executive Officer of Amax Gold
Inc. He holds a Bachelor of Science in Mining Engineering from the Colorado
School of Mines.

---

- 9 -

Reliance on Certain Exemptions

At
no time since June 1, 2011 (being the commencement of its most recently
completed financial year) has ITH relied on the exemptions in the following
sections of NI 52-110:

|1. | Section 2.4 (De Minimis Non-audit Services);                                              
|-- | ------------------------------------------------------------------------------------------
|2. | Section 3.2 (Initial Public Offerings);                                                   
|3. | Section 3.3(2) (Controlled Companies);                                                    
|4. | Section 3.4 (Events Outside Control of Member);                                           
|5. | Section 3.5 (Death, Disability or Resignation of Audit
      Committee Member);           
|6. | Section 3.6 (Temporary Exemption for Limited and
      Exceptional Circumstances);        
|7. | Section 3.8 (Acquisition of Financial Literacy);
  or                                     
|8. | an exemption from NI 52-110, in whole or in part, granted
      under Part 8 of NI 52-110.

Audit Committee Oversight

At
no time since June 1, 2011, being the commencement of ITHs most recently
completed financial year, was a recommendation of the Audit Committee to
nominate or compensate an external auditor not adopted by the Board.

Pre-Approval Policies and Procedures

The
Audit Committee is authorized by the Board to review the performance of ITHs
external auditors and approve in advance the provision of services other than
auditing and to consider the independence of the external auditors, including
reviewing the range of services provided in the context of all consulting
services bought by ITH. Such advance approval authority may be delegated by the
Audit Committee to any member of the Audit Committee who is independent and
unrelated on the condition that any such pre-approval must be presented to the
Audit Committee at its first scheduled meeting following any such approval. To
date, such authority has not been so delegated.

---

- 10 -

External Auditor Service Fees (By Category)

The
aggregate fees billed by the Companys external auditors in each of the last two
fiscal years for audit fees are as follows:

Financial Year Ending
      Audit Fees(1)
      Audit Related Fees(2)
      Tax Fees(3)
      All Other Fees(4)December 31, 2011
    $75,000
    $22,000
    $2,000
    $NilMay 31, 2011
    $65,000
    $96,000
    $9,500
    $Nil


(1) The aggregate audit fees billed.

(2) The aggregate fees billed for assurance and related
services that are reasonably related to the performance of the audit or review
of the Companys financial statements which are not included under the heading
Audit Fees. The work performed in the fiscal year ended December 31, 2011
consisted of procedures with regard to annual and interim financial statements.
The work performed in the fiscal year ended May 31, 2011 consisted of further
procedures with regard to annual and interim financial statements and pro-forma
financial statements for the purpose of the Corvus spin-out transaction, as well
as procedures with respect to the Companys November 2010 prompt offering
prospectus financing and responding to due diligence questions from the
applicable agents in connection with such financing.

(3) The aggregate fees billed for professional services
rendered for tax compliance, tax advice and tax planning. The work performed was
assistance in the preparation and review of ITHs Canadian and United States tax
returns.

(4) The aggregate fees billed for products and services other
than as set out under the headings Audit Fees, Audit Related Fees and Tax
Fees.

---