sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, theparties hereto hereby agree to the sale and purchase of the Units as set forth herein and to theother agreements set forth herein.**1. DEFINITIONS.**In addition to the terms defined elsewhere in this Agreement, for all purposes ofthis Agreement, the following terms have the respective meanings indicated in this Section 1.     **“Affiliate”**means, with respect to any specified Person: (i) if such Person is an individual,the spouse of such Person and, if deceased or disabled, his heirs, executors or legalrepresentatives, if applicable, or any trusts for the benefit of such individual or suchindividual’s spouse and/or lineal descendants, or (ii) otherwise, another Person that directly orindirectly through one or more intermediaries, controls, is controlled by, or is under commoncontrol with, such specified Person. As used in this definition, “control” shall mean thepossession, directly or indirectly, of the power to cause the direction of the management andpolicies of a Person, whether through the ownership of voting securities or by contract or otherwritten instrument.     **“ASIC”**means the Australian Securities and Investments Commission.     **“ASX”**means ASX Limited (ACN 008 624 691) and, where the context permits, the AustralianSecurities Exchange operated by ASX Limited.     **“Business**Day” means any day on which banks located in New York, New York, United States;Toronto, Ontario, Canada; Da Nang, Vietnam; Perth, Australia; Mendrisio, Switzerland; or London,England are not required or authorized by law or other governmental action to remain closed.     **“BVI Pledge Agreement”**means the BVI Pledge Agreement, dated as of June 18, 2010, by andbetween the Company and the Collateral Agent substantially in the form annexed hereto asExhibit G.     **“CAD”**or **“CAD $”**means Canadian Dollar.     **“Closing Escrow Agreement”**means the Closing Escrow Agreement, dated as of June 18, 2010, byand among the Company, the Placement Agent and the Escrow Agent substantially in the form annexedhereto as Exhibit C.     **“Collateral”**means all the Properties subject to the Liens created by the Security Documents.     **“Commission”**means the Ontario Securities Commission.     **“Company’s knowledge”**means the information and/or other items that the following executivesof the Company have actual knowledge of after due inquiry: the Chairman and Chief ExecutiveOfficer, the Chief Operating Officer, the Chief Financial Officer, the Vice President of
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Commercial Development, the Corporate Secretary, the Chief Geologist, the Vice President of Financeand the Vice President of Investor Relations.     **“Deemed Principal Amount”**has the meaning set forth in the Notes.     **“Escrow Account”**means the escrow account established by the Escrow Agent pursuant to theClosing Escrow Agreement where funds representing the Investors’ aggregate Purchase Price (ashereinafter defined) shall be held pending the Closing or any partial Closing.     **“Escrow Agent”**means Collateral Agents, LLC.     **“Exchange”**or **“TSX”**means the Toronto Stock Exchange.     **“Exchange Act”**means the Securities Exchange Act of 1934, as amended.     **“Formwell”**means Formwell Holdings Limited, a British Virgin Islands company and directwholly owned subsidiary of the Company.     **“Gold Agency Agreement”**means the Gold Agency Agreement, dated as of June 18, 2010, by andbetween the Trust Account Agent and the Investor Representative on behalf of the Investors,substantially in the form attached hereto as Exhibit K.     **“Gold Deposits”**means deposits of Gold (as defined in the Notes) made by the Company on theGold Delivery Dates (as defined in the Notes) into the Trust Account (as defined in the Notes).     **“Governmental Body”**means any: (a) nation, state, commonwealth, province, territory, county,municipality, district or other jurisdiction of any nature; (b) federal, state, local, municipal,foreign or other government; or (c) governmental or quasi-governmental authority of any nature(including any governmental or administrative division, department, agency, commission,instrumentality, official, organization, unit, body or entity) and any court or other tribunal.     **“Guarantor”**means each of Formwell and NVMC.     **“Indebtedness”**means, with respect to any specified Person, any indebtedness of suchspecified Person: (a) for borrowed money; (b) evidenced by notes, bonds, debentures or similarinstruments; (c) for the deferred and unpaid purchase price of goods, services or other property(other than trade payables or accrued expenses incurred in the ordinary course of business); (d)under capital lease obligations; and (e) in the nature of guarantees of the obligations describedin clauses (a) through (d) above of any other Person.     **“Intellectual Property”**means the Company’s patents, patent applications, provisionalpatents, trademarks, service marks, trade names, trademark registrations, service markregistrations, copyrights, licenses, formulae, mask works, customer lists, internet domain names,know-how and other intellectual property, including trade secrets and other unpatented and/or
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unpatentable proprietary or confidential information, systems, procedures or registrations orapplications relating to the same.     **“Intercompany Subordination Agreement”**means the Intercompany Subordination Agreement, datedas of June 18, 2010, by and among the Company, the Guarantors and the Collateral Agentsubstantially in the form annexed hereto as Exhibit H.     **“Investor”**means any person who purchases Units in the Offering pursuant to this Agreement.     **“Legal Requirement”**means any federal state, local, municipal, foreign or other law, statute,constitution, principle of common law, resolution, ordinance, code, edict, decree, rule,regulation, ruling or requirement issued, enacted, adopted, promulgated, implemented or otherwiseput into effect by or under the authority of any Governmental Body (or under the authority of anynational securities exchange upon which the Common Stock is then listed or traded). Reference toany Legal Requirement means such Legal Requirement as amended, modified, codified, replaced orre-enacted, in whole or in part, and in effect from time to time, and reference to any section orother provision of any Legal Requirement means that provision of such Legal Requirement from timeto time in effect and constituting the substantive amendment, modification, codification,replacement or re-enactment of such section or other provision.     **“Lien(s)”**means any interest in Property securing an obligation owed to a Person whether suchinterest is based on the common law, statute or contract, and including but not limited to asecurity interest arising from a mortgage, lien, title claim, assignment, encumbrance, adverseclaim, contract of sale, pledge, conditional sale or trust receipt or a lease, consignment orbailment for security purposes. The term “Lien” includes, but is not limited to, mechanics’,materialmen’s, warehousemen’s and carriers’ liens and other similar encumbrances. For the purposeshereof, a Person shall be deemed to be the owner of Property that it has acquired or holds subjectto a conditional sale agreement or other arrangement pursuant to which title to the Property hasbeen retained by or vested in some other Person for security purposes. For purposes ofclarification, “Lien(s)” shall not be deemed to include (a) any restrictions on Transfer pursuantto the Securities Act, the Securities Laws or any other securities laws or pursuant to any of theTransaction Documents or (b) any lien or security interest that, although reflected in a financingstatement or other filing or recording that is dated on or about August 14, 2006, relates toobligations that were due to Macquarie Bank but have been fully paid or otherwise discharged.     **“Material Adverse Effect”**means a material adverse effect on, and a **“MaterialAdverse Change”**means a material adverse change in: (i) the ability of the Company to perform itsobligations under the Transaction Documents or to pay any obligations under the Notes when due or(ii) the validity or priority of the security interests created by the Security Documents, but, tothe extent applicable, shall exclude any circumstance, change, matter or effect to the extentresulting or arising from: (a) any change in general economic conditions in the industries ormarkets in which the Company and its Subsidiaries operates so long as the Company and itsSubsidiaries are not disproportionately (in a material manner) affected by such changes; (b)national or international political conditions, including any engagement in hostilities, whetheror
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not pursuant to the declaration of a national emergency or war or the occurrence of any militaryor terrorist attack, so long as the Company and its Subsidiaries are not disproportionately (in amaterial manner) affected by such conditions; (c) changes in United States or Canadian generallyaccepted accounting principles or the interpretation thereof; (d) the entry into or announcementof this Agreement or any of the other Transaction Documents, actions contemplated by thisAgreement or any of the other Transaction Documents or the consummation of the transactionscontemplated hereby or thereby; or (e) temporary in nature.     **“Note Pledge Agreement”**means the Note Pledge Agreement, dated as of June 18, 2010, by andbetween the Company and the Collateral Agent substantially in the form annexed hereto asExhibit F.     **“NVMC”**means New Vietnam Mining Corp., a British Virgin Islands company and direct whollyowned subsidiary of the Company.     **“Obligations”**means, collectively, the obligations of the Company to make Gold Deposits underthe Notes in order to satisfy the gold delivery obligations thereunder, interest, penalties, fees,indemnifications, reimbursements, damages, costs, expenses and other liabilities payable by theCompany under the Transaction Documents (other than the Warrants).     **“Offering”**means the offering and sale of the Units pursuant to this Agreement and theMemorandum.     **“OTCBB”**means the Over-the-Counter Bulletin Board system.     **“Person”**means an individual, entity, corporation, partnership, association, limited liabilitycompany, limited liability partnership, joint-stock company, trust or unincorporated organization.     **“Property”**means any interest in any kind of property or asset, whether real, personal ormixed, or tangible or intangible.     **“Purchase Price”**means an amount equal to $10,000 per Unit multiplied by the number of Unitsbeing purchased.     **“Regulatory Authorities”**means collectively the Commission and the TSX;     **“Required Holders”**means, at any time, holders of Notes holding more than fifty percent (50%)of the aggregate Deemed Principal Amount of all Notes outstanding at such time.     **“SEC”**means the United States Securities and Exchange Commission.     **“Securities”**means, collectively, the Units, the Notes, the Warrants and the Warrant Shares.     **“Securities Act”**means the Securities Act of 1933, as amended.
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     **“Securities Laws”**means the securities legislation and regulations of, and the instruments,policies, rules, orders, decisions, notices and interpretation notes of the Commission,     **“Security Documents”**means, collectively, the BVI Pledge Agreement and the Note PledgeAgreement.     **“Subsidiary”**means any corporation or other entity or organization, whether incorporated orunincorporated, in which the Company owns, directly or indirectly, any controlling equity or othercontrolling ownership interest or otherwise controls through contract or otherwise, including,without limitation, any variable interest entity of the Company. If and for so long as the Companyowns, directly or indirectly, any controlling equity or other controlling ownership interest orotherwise controls through contract or otherwise Bong Mieu Gold Mining Company Limited (aVietnamese company), Phuoc Son Gold Company Limited (a Vietnamese Company), Bau Mining Co Ltd (aSamoan company), Binh Dinh NZ Gold Co Ltd (a Vietnamese company) or North Borneo Gold Sdn Bhd (aMalaysian company), such entity shall be deemed to be a Subsidiary.     **“Subsidiary Guaranty”**means the Guarantee Agreement, dated as of June 18, 2010, by and amongthe Guarantors and the Collateral Agent substantially in the form annexed hereto as ExhibitD.     **“Trading Day”**means: (i) a day on which the Common Stock is traded on a Trading Market (otherthan the OTC Bulletin Board), (ii) if the Common Stock is not listed on a Trading Market (otherthan the OTC Bulletin Board), a day on which the Common Stock is traded in the over the countermarket, as reported by the OTC Bulletin Board, or (iii) if the Common Stock is not quoted on anyTrading Market, a day on which the Common Stock is quoted in the over the counter market asreported by the Pink Sheets LLC (or any similar organization or agency succeeding to its functionsof reporting prices); provided, that in the event that the Common Stock is not listed or quoted asset forth in (i), (ii) and (iii) hereof, then Trading Day shall mean a Business Day.     **“Trading Market”**means whichever of the TSX, the New York Stock Exchange, the NYSE AMEX, theNASDAQ Global Select Market, the NASDAQ Global Market, the NASDAQ Capital Market or OTC BulletinBoard on which the Common Stock is listed or quoted for trading on the date in question.     **“Transaction Documents”**means, collectively, this Agreement, the Security Documents, theSubsidiary Guaranty, the Intercompany Subordination Agreement, the Notes, the Warrants and theClosing Escrow Agreement.     **“Transfer”**means any sale, transfer, assignment, conveyance, charge, pledge, mortgage,encumbrance, hypothecation, security interest or other disposition, or to make or effect any of theabove.
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     **“Trust Account Agent”**means Auramet Trading, LLC.     **“Trust Account Agreement”**means the Trust Account Agreement, dated as of April 4, 2005, byand between the Trust Account Agent and JP Morgan Chase Bank, N.A., London Branch, relating to theestablishment of the Trust Account (as defined in the Notes) in substantially the form annexedhereto as Exhibit J.     **“TSX”**means the Toronto Stock Exchange.     **“USD,” “USD $,”**or **“$”**means United States Dollars.**2. SALE AND PURCHASE OF UNITS.**     2.1. **Subscription for Units by Investors.**Subject to the terms and conditions of thisAgreement and upon the basis of the representations and warranties herein contained, on the ClosingDate, each Investor shall severally, and not jointly, purchase, and the Company shall sell andissue to each Investor, the number of Units specified by it on its signature page attached heretoin exchange for the Purchase Price therefor. Units will be sold in minimum stated or deemedprincipal amounts of $10,000.     2.2. **Closing.**Subject to the terms and conditions set forth in this Agreement, on eachClosing Date, the Company shall issue and sell to each Investor listed on Schedule A(exclusive, however, of any such Investor to which Units have already been issued and sold), andeach such Investor shall, severally and not jointly, purchase from the Company such number of Unitsas is set forth on the respective signature pages attached hereto, which will be reflected oppositesuch Investor’s name on Schedule A (each such event, a **“Closing”).**The date of eachClosing is hereinafter referred to as the **“Closing Date”**for such Closing. Each Closing shall occurwithin the time periods set forth in the Memorandum at the offices of Pillsbury Winthrop ShawPittman LLP at 2300 N Street, NW, Washington, DC 20037 or remotely via the exchange of documentsand signatures.The Investors acknowledge that the Offering may be completed at one or more Closings in thediscretion of the Company and the Investor Representative and that multiple Closings may beeffected until the Maximum Amount is raised; *provided, however,*that Units equal to at least theMinimum Amount are required to be sold at the first such Closing. Upon completion of each Closing,the Company is irrevocably entitled to the Purchase Price for the Units issued and sold at suchClosing, subject to the rights of the Investors under this Agreement and any applicable laws.     2.3. **Closing Deliveries.**At each Closing, the Company shall deliver to each Investorpurchasing Units at such Closing, against delivery by such Investor of the Purchase Price thereforas provided in the next sentence, certificates representing the Notes and the Warrants beingpurchased by such Investor. At each Closing, each Investor purchasing Units at such Closing shalldeliver or cause to be delivered to the Company: (i) the Purchase Price set forth in itscounterpart signature page annexed hereto by paying United States dollars in immediately availablefunds by wire transfer to the Escrow Account pursuant to the Closing Escrow
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Agreement; and (ii) any further documentation required under the Securities Laws or the policiesof any Regulatory Authority.     2.4. **The Notes.**The Notes shall have the terms and conditions and be substantially in the formannexed hereto as Exhibit A.     2.5. **The Warrants.**The Warrants shall have the terms and conditions and be substantially inthe form annexed hereto as Exhibit B.     2.6. **Use of Proceeds.** The Company hereby covenants and agrees that the proceeds from the saleof Units shall be used as provided for in the Memorandum.     2.7. **Appointment of the Investor Representative.**          (a) Each Investor, severally and not jointly, hereby appoints the Placement Agent (togetherwith its permitted successors, and in this context, the **“InvestorRepresentative”),**as its true and lawful agent and attorney-in-fact to, without the need for anyfurther consent or further action on the part of any Investor: (i) enter into any agreement inconnection with the transactions contemplated by this Agreement and any transactionscontemplated by the Transaction Documents; (ii) accept delivery of the certificates representingthe Notes and the Warrants comprised in the Units purchased hereunder; (iii) exercise all or any ofthe powers, authority and discretion conferred on such Investor under this Agreement or any of theTransaction Documents; (iv) without any action on the part of any Investor, waive or amend anyterms and conditions of this Agreement or any of the Transaction Documents, including, but notlimited to, waive any Event of Default (as defined in the certificate representing the Notes) andany negative or affirmative covenants of the Company contained in any Transaction Document; and (v)give and receive notices on such Investor’s behalf and to be such Investor’s exclusiverepresentative with respect to any matter, suit, claim, action or proceeding arising with respectto any transaction contemplated by this Agreement or any Transaction Document, and the InvestorRepresentative agrees to act as, and to undertake the duties and responsibilities of, such agentand attorney-in-fact. This power of attorney is coupled with an interest and irrevocable. TheInvestor Representative shall not be liable for any action taken or not taken by it in connectionwith its obligations under this Agreement, except for losses directly and solely caused by theInvestor Representative’s gross negligence or wilful misconduct. If the Investor Representativeshall be unable or unwilling to serve in such capacity, its successor shall be named by theRequired Holders, which successor shall serve and exercise the powers of the InvestorRepresentative hereunder. Each Investor hereby agrees to be bound by all actions taken by theInvestor Representative even if such Investor has not otherwise consented to or agrees with suchaction and even if neither the Required Holders nor such Investor nor any other Investor hasconsented to or agrees with such action; and each Investor hereby ratifies and confirms all actionstaken by the Investor Representative.          (b) The duties of the Investor Representative shall be ministerial and administrativein nature, and the Investor Representative shall not have a fiduciary relationship with anyInvestor, or other Person, by reason of any Transaction Document or any transaction relatingthereto. The Investor Representative shall not have any duties except those expressly set
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forth in the Transaction Documents. The conferral upon the Investor Representative of any rightshall not imply a duty on the Investor Representative’s part to exercise such right, unlessinstructed to do so by the Required Holders (or all Investors if the Transaction Documentsotherwise so provide) in accordance with this Agreement.          (c) The Investor Representative may perform its duties through agents and employees **(“InvestorRepresentative Professionals”).**The Investor Representative may consult with and employInvestor Representative Professionals and shall be entitled to act upon, and shall be fullyprotected in any action taken in good faith reliance upon, any advice given by an InvestorRepresentative Professional. The Investor Representative shall not be responsible for thenegligence or misconduct of any agents, employees or Investor Representative Professionals selectedby it with reasonable care.          (d) This Section 2.7 is an agreement solely among the Investors and the InvestorRepresentative and shall survive full payment of the Obligations. This Section 2.7 does not conferany rights or benefits or impose any duties, obligations or liabilities upon, and shall nototherwise be binding upon, the Company, the Guarantors or any other Person.          (e) To the extent that the Investor Representative is not reimbursed and indemnified by theCompany and its Subsidiaries, the Investors will jointly and severally reimburse and indemnify theInvestor Representative, in proportion to their initially purchased respective deemed or statedprincipal amounts of their Notes, from and against any and all liabilities, obligations, losses,damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind ornature whatsoever that may be imposed on, incurred by or asserted against the InvestorRepresentative in performing its duties hereunder or under the other Transaction Documents or inany way relating to or arising out of the Transaction Documents, except for those determined by afinal judgment (not subject to further appeal) of a court of competent jurisdiction to haveresulted solely from the Investor Representative’s own gross negligence or willful misconduct.Prior to taking any action hereunder as the Investor Representative, the InvestorRepresentative may require each Investor to deposit with it sufficient sums as it determines ingood faith are necessary to protect the Investor Representative for costs and expenses associatedwith taking such action.          (f) The Investor Representative hereby acknowledges and agrees to perform those obligationscontained in the Notes that require performance by the Investor Representative even though theInvestor Representative is not a party to any of the Notes.     2.8. **Appointment of Collateral Agent.**The Investors hereby appoint Collateral Agents, LLC toact as their Collateral Agent for purposes of exercising any and all rights and remedies of theInvestors under this Agreement, the Subsidiary Guaranty or the Security Documents to whichCollateral Agents, LLC is a party. Such appointment shall continue until revoked in writing by theInvestor Representative or the Required Holders, at which time the Investor Representative or theRequired Holders shall appoint a new Collateral Agent. The Collateral Agent shall have the rights,responsibilities and immunities set forth in Exhibit I annexed hereto.
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     2.9. **Acknowledgements by Company with respect to Investor Representative.**The Company agrees that (subject to the validity, binding effect and enforceability of Section2.7) the Investor Representative has standing to, and may, enforce on behalf of the Investors anyprovision of this Agreement, the Note or any other Transaction Document to which the InvestorRepresentative is a party, including any affirmative or negative covenant contained in thisAgreement, the Note or any other such Transaction Document as and to the same extent as anInvestor. As between the Company, the Guarantors and the Investor Representative, any action thatthe Investor Representative may take under any Transaction Document to which it is a party or withrespect to any Obligations shall (subject to the validity, binding effect and enforceability ofSection 2.7) be conclusively presumed to have been authorized and directed by the Investors.**3. ACKNOWLEDGEMENTS OF THE INVESTORS.**     Each Investor, severally and not jointly, acknowledges that:     3.1. **Resale Restrictions.**None of the Securities have been registered under the SecuritiesAct or under any state securities or “blue sky” laws of any state of the United States, and, unlessso registered, none of the Securities may be offered or sold by such Investor except pursuant to aneffective registration statement under the Securities Act, pursuant to an exemption from, or in atransaction not subject to, the registration requirements of the Securities Act and in each caseonly in accordance with applicable state securities laws. ***Such Investor further acknowledges thatneither this Agreement nor any of the other Transaction Documents provides such Investor with anyregistration rights and that the Company has no intention of registering any of the Securities.***     3.2. **Agreements.**Such Investor has received, carefully read and acknowledges the terms ofthe Transaction Documents and Memorandum, including the Risk Factors set forth in the Memorandumand the documents incorporated by reference into the Memorandum.     3.3. **Books and Records.**The books and records of the Company were available upon reasonablenotice for inspection, subject to certain confidentiality restrictions, by such Investor duringreasonable business hours at the Company’s principal place of business, that all documents, recordsand books in connection with the sale of the Securities hereunder have been made available forinspection by such Investor and its attorney and/or advisor(s) and that such Investor and/or itsadvisor has reviewed all such documents, records and books to its full satisfaction and allquestions it and/or its advisor(s) may have had been answered to their respective fullsatisfaction.     3.4. **Independent Advice.**Such Investor has been advised to consult such Investor’s own legal,tax and other advisors with respect to the merits and risks of an investment in the Securities andwith respect to applicable resale restrictions, and it is solely responsible (and neither theCompany nor the Placement Agent is in any way, directly and/or indirectly, responsible) forcompliance with:          (a) any applicable laws of the jurisdiction in which such Investor is resident inconnection with the distribution of the Securities hereunder, and
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          (b) applicable resale restrictions.     3.5. **No Governmental Review or Insurance.**Neither the SEC, the Commission nor any othersecurities commission, securities regulator or similar regulatory authority has reviewed or passedon the merits of the Securities or on any of the documents reviewed or executed by such Investor inconnection with the sale of the Securities, and there is no government or other insurance coveringany of the Securities.     3.6. **Personal Information.**Such Investor acknowledges and consents to the fact that theCompany is collecting personal information (as that term is defined under applicable privacylegislation, including, without limitation, the *Personal Information Protection and ElectronicDocuments Act*(Canada) and any other applicable similar, replacement or supplementalprovincial or federal legislation or laws in effect from time to time) of such Investor for thepurpose of completing this Agreement. Such Investor acknowledges and consents to the Companyretaining such personal information for as long as permitted or required by law or businesspractices; such Investor agrees and acknowledges that the Company may use and disclose suchpersonal information: (i) for internal use with respect to managing the relationships between andcontractual obligations of the Company and such Investor; (ii) for use and disclosure for incometax related purposes, including, without limitation, where required by law, disclosure to CanadianRevenue Agency; (iii) disclosure to professional advisers of the Company; (iv) disclosure tosecurities regulatory authorities and other regulatory bodies with jurisdiction with respect toreports of trade or similar regulatory filings; (v) disclosure to a governmental or other authorityto which the disclosure is required by court order or subpoena compelling such disclosure and wherethere is no reasonable alternative to such disclosure; (vi) disclosure to any Person where suchdisclosure is necessary for legitimate business reasons and is made with such Investor’s priorwritten consent; (vii) disclosure to a court determining the rights of the parties under thisAgreement; and (viii) for use and disclosure as otherwise required or permitted by law; inaddition, such Investor further acknowledges and consents to the fact that the Company may berequired to provide any one or more of the Canadian securities regulators, stock exchanges, theInvestment Industry Regulatory Organization of Canada, other regulatory agencies or the Company’sregistrar and transfer agent with any personal information provided by such Investor in thisAgreement, and may make any other filings of such personal information as the Company’s counseldeems appropriate, and such Investor acknowledges receipt of notification of the disclosure ofPersonal Information by the Company to the TSX and such Investor hereby consents to and authorizesthe foregoing use and disclosure of such Personal Information and agrees to provide, on request,all particulars required by the Company in order to comply with the foregoing. Such Investorfurther acknowledges and expressly consents to:          (a) the disclosure of Personal Information by the Company to the TSX, the ASIC, the ASX andother applicable regulatory authorities, as required;          (b) the collection, use and disclosure of Personal Information by the TSX, the ASIC or the ASXfor such purposes as may be identified by the TSX, the ASIC or the ASX respectively from time totime; and          (c) that it has been notified by the Company (i) of the delivery to the
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Commission of the full name, residential address and telephone number of such Investor, the numberand type of securities purchased, the total purchase price, the exemption relied upon and the dateof distribution, (ii) that this information is being collected indirectly by the Commission underthe authority granted to it in securities legislation, (iii) that this information is beingcollected for the purposes of the administration and enforcement of the securities legislation ofOntario, and (iv) that the Administrative Assistant to the Director of Corporate Finance can becontacted at Suite 1903, Box 55, 20 Queen Street West, Toronto, Ontario M5H 3S8 or at (416)593-8086 regarding any questions about the Commission’s indirect collection of this information(for the purposes of this Section 3.6, **“Personal Information”**means any information identifiableabout such Investor).     3.7. **No Restriction.**Except as otherwise expressly provided in any Transaction Document,the issue of the Units will not restrict or prevent the Company from obtaining any other financingor from issuing additional securities or rights.     3.8. **Proceeds of Crime.**The funds representing the aggregate Purchase Price in respect ofthe Units that will be advanced by such Investor to the Company hereunder will not representproceeds of crime for the purpose of the *Proceeds of Crime (Money Laundering) and TerroristFinancing Act*(Canada) (the **“PCMLTF Act”),**and such Investor acknowledges that the Company may inthe future be required by law to disclose the Investor’s name and other information relating tothis Agreement and such Investor’s subscription hereunder, on a confidential basis, pursuant tothe PCMLTF Act; to the best of such Investor’s knowledge, none of the subscription funds to beprovided hereunder (i) have been or will be obtained or derived, directly or indirectly, from orrelated to any activity that is deemed illegal under the laws of Canada or the United States or anyother jurisdiction, or (ii) are being tendered on behalf of a person or entity who has not beenidentified to such Investor. Such Investor shall promptly notify the Company if such Investordiscovers that any such representation ceases to be true and shall provide the Company withappropriate information in connection therewith.     3.9. **Investment Experience.**Such Investor acknowledges that the purchase of the Securitiesis a highly speculative investment and that it can, without impairing its financial condition, bearthe economic risk and complete loss of its entire investment in the Securities and has suchknowledge and experience in financial and/or business matters that it is capable of evaluating themerits and risks of the investment contemplated hereby, and such Investor can be assured to havethe capacity to protect its own interest in connection with its investment.     3.10. **Company’s Right to Reject Subscriptions.**Such Investor acknowledges that the Company,in its sole discretion, reserves the unconditional right to accept or reject, in whole or in part,this subscription, with or without cause, or to determine not to proceed with the Offering.     3.11. **Canadian Acknowledgements.**Such Investor acknowledges the following:     (a) no prospectus has been or is intended to be filed by the Company with anysecurities commission in connection with the offering of Units or the issuance of theSecurities;
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     (b) no securities commission, stock exchange or similar regulatory authority has reviewed orpassed on the merits of the Securities;     (c) there is no government or other insurance covering the Securities,, and there are risksassociated with the purchase of the Securities;     (d) there are restrictions on such Investor’s ability to resell the Securities imposed byapplicable securities legislation and the Exchange and it is the responsibility of such Investor tofind out what those restrictions are and to comply with them before selling the Securities; and     (e) the Company has advised such Investor that the Company is relying on an exemption from therequirements to provide such Investor with a prospectus under applicable securities legislation,and as a consequence of acquiring the Units pursuant to these exemptions:(i) certain protections, rights and remedies provided by applicable securitieslegislation, including statutory rights of rescission or damages, will not be available tosuch Investor;(ii) such Investor may not receive information that might otherwise be required to beprovided to such Investor under the applicable securities legislation if the exemption wasnot being used; and(iii) the Company is relieved from certain obligations that would otherwise apply underthe applicable securities legislation if an exemption was not being used;     (f) the Securities shall be subject to statutory resale restrictions under SecuritiesLaws;     (g) such Investor covenants that it will not resell any of the Securities except in compliancewith applicable laws, and such Investor acknowledges that it is solely responsible (and the Companyis not in any way responsible) for such compliance;     (h) such Investor’s ability to transfer the Securities is limited by, among other things,applicable Securities Laws;     (i) the certificates or other instruments representing the Notes will bear, as of the ClosingDate, in addition to any other legends required by applicable law, legends substantially in thefollowing form and with the necessary information inserted:**“UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THE SECURITIES SHALL NOTTRADE THE SECURITIES BEFORE [the date that is 4 months and 1 day after the ClosingDate]. OTHER JURISDICTIONS MAY HAVE A LONGER HOLDING PERIOD.”**
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     (j) the certificates or other instruments representing the Warrants will bear, as ofthe Closing Date (and in the event the Warrants are exercised prior to the date that isfour months and one day after the Closing Date, the Warrant Shares will bear), legendssubstantially in the following form and with the necessary information inserted:**“UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THE SECURITIESSHALL NOT TRADE THE SECURITIES BEFORE [the date that is 4 months and 1 dayafter the Closing Date] IN CANADA. OTHER JURISDICTIONS MAY HAVE A LONGERHOLDING PERIOD.”****“THE SECURITIES ISSUABLE UPON EXERCISE OF THE SECURITIES REPRESENTED BY THISCERTIFICATE ARE LISTED ON THE TORONTO STOCK EXCHANGE (THE “TSX”); HOWEVER, THESAID SECURITIES CANNOT BE TRADED THROUGH THE FACILITIES OF THE TSX SINCE THEYARE NOT FREELY TRANSFERABLE, AND CONSEQUENTLY ANY CERTIFICATE REPRESENTING SUCHSECURITIES IS NOT “GOOD DELIVERY” IN SETTLEMENT OF TRANSACTIONS ON THE TSX.”**     3.12. **Australian Acknowledgements.**Such Investor agrees not to offer any Warrant Shares forsale to any person in Australia **(“Offer”),**through an on-market sale on the ASX or otherwise,within 12 months from the date of issue of the Warrant Shares to the Investor on exercise of aWarrant unless:     (a) the Offer does not require disclosure as a result of section 708 or 708A of theAustralian Corporations Act 2001 (excluding section 708 (1) of the Australian CorporationsAct 2001); or     (b) the Offer is made pursuant to a disclosure document in accordance with theAustralian Corporations Act 2001.**4. REPRESENTATIONS AND WARRANTIES OF THE INVESTORS.**     Each Investor, severally and not jointly, represents and warrants to the Company, solely asto such Investor, that as at the date given above and the Closing Date:     4.1. **Capacity.**Such Investor: (i) if a natural person, has reached the age of 21 and has fullauthority, legal capacity and competence to enter into, execute and deliver this Agreement and theother Transaction Documents to which such Investor is (directly or through the InvestorRepresentative) a party and all other related agreements or certificates and to take all actionsrequired pursuant hereto and thereto and to carry out the provisions hereof and thereof; (ii) if acorporation, partnership or limited liability company or partnership, or association, joint stockcompany, trust, unincorporated organization or other entity, was not formed for the specificpurpose of acquiring the Units, is duly organized, validly existing and in good standing under thelaws of the state of its organization, has full power and authority to execute and deliver thisAgreement, the other Transaction Documents to which it is (directly or through the Investor
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Representative) a party and all other related agreements or certificates and to take all actionsrequired pursuant hereto and thereto and to carry out the provisions hereof and thereof and topurchase and hold the Units; (iii) the execution and delivery of this Agreement and the otherTransaction Documents to which it is (directly or through the Investor Representative) a partyhave been duly authorized by all necessary action on the part of such Investor; (iv) if executingthis Agreement in a representative or fiduciary capacity, has full power and authority to executeand deliver this Agreement and the other Transaction Documents to which it is (directly or throughthe Investor Representative) a party in such capacity and on behalf of the subscribing individual,ward, partnership, trust, estate, corporation, limited liability company or partnership or otherentity for whom such Investor is executing this Agreement and the other Transaction Documents; and(v) such individual, partnership, ward, trust, estate, corporation, limited liability company orpartnership or other entity has full right and power to perform pursuant to this Agreement and theother Transaction Documents to which it is (directly or through the Investor Representative) aparty and make an investment in the Company.     4.2. **No Violation of Corporate Governance Documents.**If such Investor is a corporation orother entity, the entering into of this Agreement and the other Transaction Documents to which itis (directly or through the Investor Representative) a party and the performance by such Investorof the transactions contemplated hereby and thereby do not and will not result in the violation ofany of the terms and provisions of any law applicable to, or the charter or other organizationaldocuments, bylaws or other governing documents of, such Investor or of any agreement, written ororal, to which such Investor may be a party or by which such Investor is or may be bound.     4.3. **Binding Agreement.**Such Investor has duly executed and delivered this Agreement andthe other Transaction Documents to which it is (or, in the case of any other Transaction Documentto which such Investor is contemplated to be a party or by which it is contemplated that suchInvestor will be bound, has caused the Investor Representative to execute the same of behalf ofsuch Investor, with such Investor intending and hereby agreeing to be bound thereby as if it were asignatory thereto) a party, and this Agreement and the other Transaction Documents to which it is(directly or through the Investor Representative) a party constitute valid and binding agreementsof such Investor enforceable against such Investor in accordance with their respective terms,except as such enforceability may be limited by general principals of equity or by applicablebankruptcy, insolvency, reorganization, moratorium, liquidation and other similar laws relatingto, or affecting generally, the enforcement of applicable creditors’ rights and remedies.     4.4. **Purchase Entirely for Own Account.**The Securities are being acquired by such Investor asprincipal for such Investor’s own account, not as nominee or agent, and not for the benefit of anyother Person, for investment purposes only and not with a view to the resale or distribution of anypart thereof in violation of any United States federal and state securities laws or the SecuritiesLaws, and such Investor has no present intention of selling, granting any participation in orotherwise distributing the same in violation of the Securities Act or the Securities Laws, withoutprejudice, however, to such Investor’s right at all times to sell or otherwise dispose of all orany part of the Securities in compliance with United States federal and state securities laws andthe Securities Laws, as may be applicable.
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     4.5. **Not a Broker-Dealer.**Such Investor is neither a registered representative under theFinancial Industry Regulatory Authority **(“FINRA”),**a member of FINRA or associated or Affiliatedwith any member of FINRA, nor a broker-dealer registered with the SEC under the Exchange Act orengaged in a business that would require it to be so registered, nor is it an Affiliate of such abroker-dealer or any Person engaged in a business that would require it to be registered as abroker-dealer. In the event such Investor is a member of FINRA or associated or Affiliated with amember of FINRA, such Investor agrees, if requested by FINRA, to sign a lock-up, the form of whichshall be satisfactory to FINRA with respect to the Securities.     4.6. **Not an Underwriter.**Such Investor is not an underwriter of the Common Stock, nor is it anAffiliate of an underwriter of the Common Stock.     4.7. **Disclosure of Information.**Such Investor has had an opportunity to receive, and fully andcarefully review, all information related to the Company and the Securities requested by it and toask questions of and receive answers from the Company regarding the Company and its business andthe terms and conditions of the Offering of the Securities. Neither such inquiries nor any otherdue diligence investigation conducted by such Investor shall modify, amend or affect suchInvestor’s right to rely on the Company’s representations and warranties contained in thisAgreement. Such Investor acknowledges that it has received, and fully and carefully reviewed andunderstands, all of the Transaction Documents, including, but not limited to, the Memorandumdescribing, among other items, the Company, its business and risks, the Securities and the offeringof the Securities. Such Investor acknowledges that it has received, and fully and carefullyreviewed and understands, copies of the SEC Reports (as defined below), either in hard copy orelectronically through the SEC’s EDGAR system. Such Investor acknowledges that the TransactionDocuments and the Memorandum do not contain all the information that would be included in aregistration statement covering the offering and sale of the Securities under the Securities Act.Such Investor understands that its investment in the Securities involves a high degree of risk.Such Investor’s decision to enter into this Agreement has been made based solely on the independentevaluation of such Investor and its representatives. Such Investor has received such accounting,tax and legal advice from Persons (other than the Company and its officers and otherrepresentatives) as it has considered necessary to make an informed investment decision withrespect to the acquisition of the Securities.     4.8. **Restricted Securities.**Such Investor understands that the sale or re-sale of theSecurities has not been and is not being registered under the Securities Act or any applicablestate securities laws, and the Securities, as applicable, may not be transferred unless:          (a) they are sold pursuant to an effective registration statement under the Securities Act; or          (b) they are being sold pursuant to a valid exemption from the registration requirements ofthe Securities Act; or          (c) they are sold or transferred to an “affiliate” (as defined in Rule 144, promulgated underthe Securities Act (or a successor rule **(“Rule 144”))**of such Investor who
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agrees to sell or otherwise transfer the Securities only in accordance with this Section 4.8 andwho is an accredited investor, or          (d) they are validly sold pursuant to Rule 144.     Such Investor further understands that any sale of the Securities made in reliance on Rule144 may be made only in accordance with the terms and conditions of Rule 144 and that neither theCompany nor any other Person is under any obligation to register the Securities under theSecurities Act or any state securities laws. Notwithstanding the foregoing or anything elsecontained herein to the contrary, the Securities may be pledged as collateral in connection with a*bona fide*margin account or other lending arrangement.     4.9. **Accredited Investor.**Such Investor is an “accredited investor” as definedin Rule 501(a) of Regulation D, as amended, under the Securities Act **(“Regulation D”).**Such Investor is alsoan “accredited investor” as defined in Section 1.1 of National Instrument 45-106 entitled“Prospectus and Registration Exemptions” under the Canadian Securities Laws.     4.10. **No General Solicitation.**Such Investor did not learn of the investment in theSecurities as a result of any public advertising or general solicitation and is not aware of anypublic advertisement or general solicitation in respect of the Company or its securities.     4.11. **Brokers and Finders.**Such Investor will not have, as a result of the transactionscontemplated by the Transaction Documents, any valid right, interest or claim against or upon theCompany, any Subsidiary or any other Investor for any commission, fee or othercompensation pursuant to any agreement, arrangement or understanding entered into by or on behalfof such Investor.     4.12. **Prohibited Transactions.**Other than with respect to the transactionscontemplated herein, since the earlier to occur of: (i) the time that such Investor was firstcontacted by the Placement Agent or any other Person regarding an investment in the Company and(ii) the thirtieth (30th) day prior to the date hereof, neither such Investor nor anyAffiliate of such Investor that (x) had knowledge of the transactions contemplated hereby, (y) hasor shares discretion relating to such Investor’s investments or trading or information concerningsuch Investor’s investments, including in respect of the Securities, or (z) is subject to suchInvestor’s review or input concerning such Affiliate’s investments or trading decisions(collectively, **“Trading Affiliates”)**has, directly or indirectly, nor has any Person acting onbehalf of, or pursuant to, any understanding with such Investor or Trading Affiliate effected, oragreed to effect, any transactions in the securities of the Company or involving the Company’ssecurities.     4.13. **Residency.**Such Investor is a resident of, or if not an individual, has its headoffice located in, the jurisdiction set forth in on such Investor’s signature page hereto, whichaddress is the Investor’s residence or principal place of business, and such address was notobtained or used solely for the purpose of acquiring the Units.     4.14. **Reliance on Exemptions.**Such Investor understands that the Securities are being offeredand sold to it in reliance upon specific exemptions from the registration requirements of
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United States federal and state securities laws and that the Company is relying upon the truth andaccuracy of, and such Investor’s compliance with, the representations, warranties, agreements,acknowledgments and understandings of such Investor set forth herein and in its questionnaire inorder to determine the availability of such exemptions and the eligibility of such Investor toacquire the Securities. All of the information that such Investor has provided to the Company istrue, correct and complete as of the date this Agreement is signed, and if there should be anychange in such information prior to the Closing, such Investor will immediately provide the Companywith such information. Such Investor will indemnify and hold the Company, its affiliates, andrepresentatives, harmless from and against any and all loss, liability, cost, damage, expense(including attorney’s fees and expenses) and claims arising out of, in connection with or resultingfrom (i) the sale or distribution of the Securities by such Investor in violation of any applicablelaw, rule or regulation and/or (ii) any misrepresentation by such Investor or any breach of anywarranties herein or in such Investor’s questionnaire or any covenants or agreements set forthherein. Notwithstanding the provisions of this paragraph, no Investor shall be required toindemnify any Person pursuant to this paragraph in an amount in excess of the amount of theaggregate Purchase Price paid by such Investor pursuant to the Offering.     4.15. **Control Person.**Such Investor is not a “control person” of the Company as defined inthe *Securities Act*(Ontario), will not become a “control person” by virtue of the purchase of anyof the Units and does not intend to act in concert with any other Person to form a control group ofthe Company.     4.16. **No Representation.**Other than in connection with the redemption of the Notes, no personhas made to such Investor any written or oral representations: (i) that any Person will resell orrepurchase any of the Securities; (ii) that any Person will refund the Purchase Price; (iii) as tothe future price or value of any of the Securities; or (iv) that any of the Securities will belisted and posted for trading on a stock exchange or that application has been made to list andpost any of the Securities for trading on a stock exchange.     4.17. **International Investors.**If such Investor is resident outside the United States, suchInvestor: (a) is knowledgeable of, or has been independently advised as to, the applicablesecurities laws of the securities regulatory authorities (the **“Authorities”)**having application inthe jurisdiction in which such Investor is resident (the **“International Jurisdiction”)**which wouldapply to the acquisition of the Units; (b) is purchasing the Units pursuant to exemptions from theprospectus and registration requirements under the applicable securities laws of the Authorities inthe International Jurisdiction or, if such is not applicable, such Investor is permitted topurchase the Units under the applicable securities laws of the Authorities in the InternationalJurisdiction without the need to rely on any exemption; (c) such Investor confirms that thesubscription by such Investor does not contravene any applicable securities laws of the Authoritiesin the International Jurisdiction and does not require the Company to make any filings or seek anyapprovals of any nature whatsoever from any Authority of any kind whatsoever in the InternationalJurisdiction in connection with the issue and sale or resale of the Units; and (d) such Investorconfirms that the purchase of the Units by such Investor does not trigger: an obligation by theCompany or any other Person to prepare and file a registration statement, prospectus or similardocument, or any other report with respect to such purchase in the International Jurisdiction; orcontinuous disclosure reporting obligations of the Company in
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the International Jurisdiction; and such Investor will, if requested by the Company comply withsuch other requirements as the Company may reasonably require.**5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.**     The Company hereby represents and warrants to each Investor as of the date hereof and as ofthe Closing Date applicable to such Investor’s purchase of any Units hereunder that, except as setforth or disclosed in the SEC Reports, the Memorandum or the corresponding Schedule of theDisclosure Schedule that is delivered to the Investor Representative or is attached hereto and madea part hereof:     5.1. **Subsidiaries.**A true and correct structure chart of the Company and its wholly ownedand consolidated Subsidiaries is included as Schedule 5.1 to the Disclosure Schedules.Except as disclosed on Schedule 5.1 to the Disclosure Schedules or in the Memorandum, theCompany owns, directly or indirectly, all of the capital stock of each Subsidiary free and clear ofany Liens, and all the issued and outstanding shares of capital stock of each Subsidiary arevalidly issued and are fully paid, non-assessable and free of pre-emptive and similar rights. Thesole purpose of Bong Mieu Holdings Ltd. **(“BM Thai HoldCo”),**a Thai corporation, is to hold theequity interests of Bong Mieu Gold Mining Company Limited, a Vietnamese company, and BM Thai HoldCoconducts no other business, holds no other assets or is not liable for any Indebtedness or otherliabilities.     5.2. **Organization and Qualification.**Each of the Company and the Subsidiaries is an entityduly incorporated or otherwise organized, validly existing and in good standing under the laws ofthe jurisdiction of its incorporation or organization, with the requisite power and authority toown and use its properties and assets and to carry on its business as currently conducted. Neitherthe Company nor any Subsidiary is in violation of any of the provisions of its respectivecertificate or articles of incorporation, bylaws or other organizational or charter documents. Eachof the Company and the Subsidiaries is duly qualified to conduct business and is in good standingas a foreign corporation or other entity in each jurisdiction in which the nature of the businessconducted or property owned by it makes such qualification necessary, except where the failure tobe so qualified or in good standing, as the case may be, would not have or reasonably be expectedto result in a Material Adverse Effect.     5.3. **Authorization; Enforcement.**The Company has the requisite corporate power and authorityto enter into the Transaction Documents to which it is a party, to consummate the transactionscontemplated thereby to be consummated by it and otherwise to carry out its obligations thereunder.The execution and delivery by the Company of each of the Transaction Documents which it is a partyand the consummation by it of the transactions contemplated thereby to be consummated by it havebeen duly authorized by all necessary action on the part of the Company, and no further action isrequired by the Company in connection therewith. Each Transaction Document to which the Company isa party has been (or upon delivery will have been) duly executed by the Company and, when deliveredin accordance with the terms hereof, will constitute the valid and binding obligation of theCompany, enforceable against the Company in accordance with its terms except: (i) as limitedby applicable bankruptcy, insolvency, reorganization, moratorium and other laws ofgeneral application affecting
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enforcement of creditors’ rights generally; and (ii) as limited by laws relating to theavailability of specific performance, injunctive relief or other equitable remedies.     5.4. **No Conflicts.**The execution, delivery and performance by the Company of the TransactionDocuments to which it is a party and the consummation by the Company of the transactionscontemplated thereby to be consummated by it do not and will not: (i) conflict with or violate anyprovision of the Company’s certificate or articles of incorporation, bylaws or other organizationalor charter documents; (ii) conflict with, or constitute a default (or an event that with notice orlapse of time or both would become a default) under, or give to others any rights of termination,amendment, acceleration or cancellation (with or without notice, lapse of time or both) of, anyagreement, credit facility, debt or other instrument (evidencing a Company debt or otherwise) orother understanding to which the Company is a party or by which any property or asset of theCompany is bound or affected; or (iii) result in a violation of any law, rule, regulation, order,judgment, injunction, decree or other restriction of any court or governmental authority to whichthe Company is subject (including federal and state securities laws and regulations), or by whichany property or asset of the Company is bound or affected; except in the case of each of clauses(ii) and (iii), such as would not have or reasonably be expected to result in a Material AdverseEffect.     5.5. **Filings, Consents and Approvals.**Neither Company nor any Subsidiary is required toobtain any consent, waiver, authorization or order of, give any notice to, or make any filing orregistration with, any court or other foreign, federal, state, local or other governmentalauthority or other Person in connection with the execution, delivery and performance by the Companyof any of the Transaction Documents to which the Company is a party, other than (a) theapplication(s) to each Trading Market for the listing of the Warrant Shares for trading thereon inthe time and manner required thereby and applicable Blue Sky filings, (b) such as have already beenobtained or such exemptive filings as are required to be made under applicable securities laws, and(c) such other filings that have been made pursuant to applicable state securities laws andpost-sale filings pursuant to applicable state and federal securities laws that the Companyundertakes to file within the applicable time periods. Subject to the truth, completeness andaccuracy of the representations and warranties of each Investor set forth in Sections 3 and 4hereof and in its questionnaire, the Company has taken all action necessary to exempt: (i) theissuance and sale of the Securities; (ii) the issuance of the Warrant Shares upon due exercise ofthe Warrants; and (iii) the other transactions contemplated by the Transaction Documents to whichthe Company is a party from the provisions of any stockholder rights plan or other “poison pill”arrangement, any anti-takeover, business combination or control share law or statute binding on theCompany or to which the Company or any of its assets and properties may be subject and anyprovision of the Company’s Articles of Incorporation or Bylaws that is or could reasonably beexpected to become applicable to the Investors as a result of the transactions contemplated hereby,including without limitation, the issuance of the Securities and the ownership, disposition orvoting of the Securities by the Investors or the exercise of any right granted to the Investorspursuant to this Agreement or the other Transaction Documents to which the Company is a party.Without limiting the generality of the foregoing, subject to the truth, completeness and accuracyof the representations and warranties of each Investor set forth in Sections 3 and 4 hereof and inits questionnaire, the Units are being offered and sold without registration under the SecuritiesAct or applicable Canadian securities regulations in a private
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placement that is exempt from the registration provisions of the Securities Act and such Canadiansecurities regulations.     5.6. **Issuance of the Securities.**The Notes are (or will be) duly authorized and, when issuedand paid for in accordance with this Agreement, will be duly and validly created, free and clear ofall Liens. The Warrants have been duly and validly authorized. Upon the due exercise of theWarrants, the Warrant Shares will be validly issued, fully paid and non-assessable and free andclear of all Liens. The Company has reserved (or will reserve) from its duly authorized capitalstock the maximum number of shares of Common Stock issuable pursuant to the Warrants.     5.7. **Security Documents.**The Security Documents, when executed and delivered by the Company inconnection with the sale of the Units, will create in favor of the Collateral Agent for the benefitof itself and the Investors, valid and enforceable security interests in and liens on the right,title and interest of the Company in its Collateral described therein, and upon the taking of suchactions as are further described in the Security Documents, the security interests in and liens onthe rights, title and interest of the Company in its Collateral described therein will be perfectedto the extent a security interest therein can be perfected by the taking of such actions.     5.8. **Capitalization and Ranking.**Schedule 5.8 to the Disclosure Schedules setsforth as of the date hereof: (a) the authorized capital stock of the Company; (b) the number ofshares of capital stock issued and outstanding; (c) the number of shares of capital stock issuablepursuant to the Company’s stock plans; and (d) the number of shares of capital stock issuable andreserved for issuance pursuant to securities (other than the Warrants) exercisable for, orconvertible into or exchangeable for any shares of capital stock of the Company. All of theissued and outstanding shares of the Company’s capital stock have been duly authorized and validlyissued and are fully paid, non-assessable and free of pre-emptive rights and were issued in fullcompliance with applicable state and federal securities law and any rights of third parties. NoPerson has any right of first refusal, pre-emptive right, right of participation or any similarright to participate in the transactions contemplated by this Agreement, the Notes or the Warrants.Except as described on Schedule 5.8 to the Disclosure Schedules, there are nooutstanding options, warrants, script rights to subscribe to, calls or commitments of any characterwhatsoever relating to, or securities, rights or obligations convertible into or exchangeable for,or giving any Person any right to subscribe for or acquire, any shares of Common Stock, orcontracts, commitments, understandings or arrangements by which the Company or any Subsidiaryis or may become bound to issue additional shares of Common Stock, or securities or rightsconvertible or exchangeable into shares of Common Stock, other than in connection with theCompany’s stock option plan. The issue and sale of the Securities will not obligate the Companyto issue shares of Common Stock or other securities to any Person (other than the Investors and thePlacement Agent) and will not result in a right of any holder of Company securities to adjust theexercise, conversion, exchange or reset price under such securities. Except as described onSchedule 5.8 to the Disclosure Schedules, there are no voting agreements, buy-sellagreements, option or right of first purchase agreements or other agreements of any kindamong the Company and any of the securityholders of the Company relating to the securities of theCompany held by them. Except as described on Schedule 5.8 to the Disclosure Schedules, noPerson has the right to require the Company to register any
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securities of the Company under the Securities Act, whether on a demand basis or in connectionwith the registration of securities of the Company for its own account or for the account of anyother Person.     5.9. **SEC Reports; Financial Statements.**The Company has filed all reports and registrationstatements required to be filed by it under the Securities Act and the Exchange Act, includingpursuant to Section 13(a) or 15(d) thereof, for the two years preceding the date hereof (or suchshorter period as the Company was required by law to file such material) (the foregoing materials,including the exhibits thereto, being collectively referred to herein as the **“SEC Reports”**and,together with the Disclosure Schedules to this Agreement and the Memorandum, the **“DisclosureMaterials”)**on a timely basis or has received a valid extension of such time of filing and hasfiled any such SEC Reports prior to the expiration of any such extension. As of their respectivedates, the SEC Reports complied in all material respects with the requirements of the SecuritiesAct and the Exchange Act and the rules and regulations of the SEC promulgated thereunder, and noneof the SEC Reports, when filed, contained any untrue statement of a material fact or omitted tostate a material fact required to be stated therein or necessary in order to make the statementstherein, in light of the circumstances under which they were made, not misleading. The financialstatements of the Company included in the SEC Reports comply in all material respects withapplicable accounting requirements and the rules and regulations of the SEC with respect thereto asin effect at the time of filing. Such financial statements have been prepared in accordance withgenerally accepted accounting principles in Canada applied on a consistent basis during the periodsinvolved **(“Canadian GAAP”),**except as may be otherwise specified in such financial statements orthe notes thereto and except that unaudited financial statements may not contain all footnotesrequired by Canadian GAAP, and fairly present in all material respects the financial position ofthe Company and its consolidated subsidiaries as of and for the dates thereof and the results ofoperations and cash flows for the periods then ended, subject, in the case of unaudited statements,to normal, immaterial, year-end audit adjustments.     5.10. **Material Changes.**Except as disclosed in the Memorandum, the SEC Reports or Schedule5.10 to the Disclosure Schedules, since the date of the latest audited financial statementsincluded in the SEC Reports, the Company and its Subsidiaries have not done any of the following(other than with respect to the matters referred to in clause (a) or (j) below) that, if it hadoccurred (and, if applicable, continued) prior to the date of the most recent SEC Report, wouldhave been required to be disclosed in such SEC Report and that has had or is reasonably anticipatedto have a Material Adverse Effect:          (a) suffered any Material Adverse Change;          (b) suffered any damage, destruction or loss, whether or not covered by insurance, in anamount in excess of CAD $200,000;          (c) granted or agreed to make any increase in the compensation payable or to become payable bythe Company or any of its Subsidiaries to any officer or employee, except for normal raises fornon-executive personnel made in the ordinary course of business that are usual and normal inamount;
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          (d) declared, set aside or paid any dividend or made any other distribution on or in respectof the shares of capital stock of the Company or any of its Subsidiaries, or declared or agreed toany direct or indirect redemption, retirement, purchase or other acquisition by the Company or anyof its Subsidiaries of such shares;          (e) issued any shares of capital stock of the Company or any of its Subsidiaries, orany warrants, rights or options thereof, or entered into any commitment relating to the shares ofcapital stock of the Company or any of its Subsidiaries, other than pursuant to or as contemplatedby any of the Transaction Documents or any engagement or similar agreement with the PlacementAgent;          (f) adopted or proposed the adoption of any change in the Company’s Certificate ofIncorporation or Bylaws or similar constituent instruments;          (g) made any change in the accounting methods or practices they follow, whether for generalfinancial or tax purposes, or any change in depreciation or amortization policies or rates adoptedtherein, or any tax election;          (h) sold, leased, abandoned or otherwise disposed of any real property or any machinery,equipment or other operating property other than in the ordinary course of their business;          (i) sold, assigned, transferred, licensed or otherwise disposed of any of the Company’sIntellectual Property or interest thereunder or other intangible asset except in the ordinarycourse of their business;          (j) been involved in any dispute involving any employee that would reasonably be expected toresult in a Material Adverse Change;          (k) entered into, terminated or modified any employment, severance, termination or similaragreement or arrangement with, or granted any bonuses (or bonus opportunity) to, or otherwiseincreased the compensation of any executive officer;          (l) entered into any material commitment or transaction (including, without limitation, anyborrowing or capital expenditure), other than pursuant to or as contemplated by any of theTransaction Documents or any engagement or similar agreement with the Placement Agent;          (m) amended or modified, or waived any default under, any Material Contract (as definedbelow);          (n) to the Company’s knowledge, incurred any material liabilities, contingent or otherwise,either matured or unmatured (whether or not required to be reflected in financial statements inaccordance with Canadian GAAP, and whether due or to become due), except for accounts payable oraccrued salaries that have been incurred by the Company since the date of the latest auditedfinancial statements included within the SEC Reports, in the ordinary course of its business andconsistent with the Company’s past practices;
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          (o) permitted or allowed any of their material property or assets to be subjected to anymaterial Lien (other than Liens created pursuant to or as contemplated by any of the TransactionDocuments);          (p) settled any claim, litigation or action, whether now pending or hereafter made orbrought;          (q) made any capital expenditure or commitment for additions to property, plant or equipmentindividually in excess of CAD $200,000 or in the aggregate, in excess of CAD $500,000;          (r) paid, loaned or advanced any amount to, or sold, transferred or leased any properties orassets to, or entered into any agreement or arrangement with any of their Affiliates, officers,directors or stockholders or, to the Company’s knowledge, any Affiliate or associate of any of theforegoing;          (s) made any amendment to, or terminated any agreement that, if not so amended or terminated,would be material to the business, assets, liabilities, operations or financial performance of theCompany or any of its Subsidiaries;          (t) compromised or settled any claims relating to taxes, any tax audit or other taxproceeding, or filed any amended tax returns;          (u) merged or consolidated with any other Person, or acquired a material amount of assets ofany other Person;          (v) entered into any agreement in contemplation of the transactions specified herein otherthan this Agreement, the other Transaction Documents and an engagement or similar agreement withthe Placement Agent; or          (w) (other than pursuant to or as contemplated by any of the Transaction Documents or anyengagement or similar agreement with the Placement Agent) agreed to take any action described inthis Section 5.10 or that would reasonably be expected to otherwise constitute a breach of any ofthe representations or warranties of the Company contained in this Agreement.     5.11. **Litigation.**Except as disclosed in the Memorandum, the SEC Reports or Schedule5.11 to the Disclosure Schedules, there is no action, suit, inquiry, notice of violation,proceeding or investigation pending or, to the Company’s knowledge, threatened against or affectingthe Company, any Subsidiary or any of their respective properties before or by any court,arbitrator, governmental or administrative agency or regulatory authority (federal, state, county,local or foreign) (collectively, an **“Action”)**that: (i) adversely affects or challenges thelegality, validity or enforceability of any of the Transaction Documents or the Securities; or (ii)would, if there were an unfavourable decision with respect thereto, have or are reasonably beexpected to result in a Material Adverse Effect. Neither the Company nor any Subsidiary, nor, tothe Company’s knowledge, any director or officer thereof, is the subject of any Action involving aclaim of violation of or liability under federal or state securities laws or a claim of breach offiduciary duty. There has not been, and to the Company’s knowledge, there is not pending or
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contemplated, any investigation by the Commission or SEC involving the Company or any currentor former director or officer of the Company. Neither the Commission nor the SEC has issued anystop order or other order suspending the effectiveness of any registration statement filed by theCompany or any Subsidiary under the Exchange Act or the Securities Act.     5.12. **Compliance.**Neither the Company nor any Subsidiary: (i) is in default under or inviolation of (and no event has occurred that has not been waived that, with notice or lapse of timeor both, would result in a default by the Company or any Subsidiary under), nor has the Company orany Subsidiary received notice of a claim that it is in default under or that it is in violationof, any indenture, loan or credit agreement or any other agreement or instrument to which it is aparty or by which it or any of its properties is bound (whether or not such default or violationhas been waived); (ii) is in violation of any order of any court, arbitrator or GovernmentalBody; or (iii) is or has been in violation of any statute, rule or regulation of any governmentalauthority, including without limitation all foreign, federal, state and local laws applicable toits business, except in the case of clauses (i), (ii) and (iii) as would not have or reasonably beexpected to result in a Material Adverse Effect.     5.13. **Regulatory Permits.**Except as disclosed in the SEC Reports or theMemorandum, the Company and the Subsidiaries possess all certificates, authorizations and permitsissued by the appropriate federal, state, local or foreign regulatory authorities necessary toconduct their respective businesses as described in the SEC Reports and the Memorandum, exceptwhere the failure to possess such permits would not have or reasonably be expected to result in aMaterial Adverse Effect (“**Material Permits**”), and neither the Company nor any Subsidiary hasreceived any notice of proceedings relating to the revocation or modification of any MaterialPermit.     5.14. **Title to Assets.**Except as disclosed in the SEC Reports or the Memorandum, the Companyand the Subsidiaries have good and marketable title to all real property owned by them that ismaterial to the business of the Company and the Subsidiaries and good and marketable title in allpersonal property owned by them that is material to the business of the Company and theSubsidiaries, in each case free and clear of all Liens, except for (a) Liens as do not materiallyaffect the value of such property and do not materially interfere with the use made and proposed tobe made of such property by the Company and the Subsidiaries, (b) Liens for the payment of federal,state or other taxes, the payment of which is neither delinquent nor subject to penalties and (c)Liens created pursuant to or as contemplated by any of the Transaction Documents. Any real propertyand facilities held under lease by the Company and the Subsidiaries are held by them under valid,subsisting and enforceable leases of which the Company and the Subsidiaries are in compliance,except where the failure to hold any such lease or to be in compliance therewith would not have orreasonably be expected to result in a Material Adverse Effect.
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     5.15. **Contracts.**          (a) Except for the Transaction Documents or any engagement or similar agreement with thePlacement Agent or as disclosed in the SEC Reports, the Memorandum or Schedule 5.15(a) tothe Disclosure Schedules, neither the Company nor any of its Subsidiaries is party or subject to,or bound by, any of the following, except to the extent that (a) the same have been entered intoin the ordinary course of business as gold mining production and exploration company or as adirect or indirect parent of a gold mining production and exploration company, including, withoutlimitation, as required for construction of the Phuoc Son Gold Company Limited processing plant,or (b) the same would not be required to be disclosed in the SEC Reports:               (i) any agreements, contracts or commitments that call for prospective fixed and/orcontingent payments or expenditures by or to the Company or any of its Subsidiaries of more thanCAD $200,000 or that are otherwise material and not entered into in the ordinary course ofbusiness;               (ii) any contract, lease or agreement that involves payments in excess of CAD $200,000 andthat is not cancellable by the Company or any of its Subsidiaries, as applicable, without penaltyon not less than 60 days notice except for: Blasting Service Contract for Bong Mieu 18 August 2009to 31 December 2014 for US $64,303 pa. Balance to go US $241,136; Ore Hauling Contract for PhuocSon 1 November 2008 to 31 September 2010 for US $966,891 with 7 months to pay is US $294,271; andLease and operating costs commitments for Toronto office expires 31 December 2012 with netcommitment remaining of CAD $305,507;               (iii) any contract, including any distribution agreements, containing covenants directly orexplicitly limiting the freedom of the Company or any of its Subsidiaries to compete in any lineof business or with any Person or to offer any of its products or services;               (iv) any indenture, mortgage, promissory note, loan agreement, guaranty or other agreement orcommitment for the borrowing of money or pledging or granting a security interest in any assets;               (v) any employment contracts, non-competition agreements, invention assignments, severance orother agreements with officers, directors, employees, stockholders or consultants of the Company orany of its Subsidiaries or Persons related to or affiliated with such Persons;               (vi) any stock redemption or purchase agreements or other agreements affecting or relating tothe capital stock of the Company or any of its Subsidiaries, including, without limitation, anyagreement with any stockholder of the Company or any of its Subsidiaries that includes, withoutlimitation, antidilution rights, voting arrangements or operating covenants;               (vii) any pension, profit sharing, retirement, stock option or stock ownership plans;               (viii) any royalty, dividend or similar arrangement based on the revenues or profits of theCompany or any of its Subsidiaries or based on the revenues or profits derivedfrom any material contract;
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               (ix) any acquisition, merger, asset purchase or other similar agreement;               (x) any sales agreement that entitles any customer to a right of set-off or right to a refundafter acceptance thereof;               (xi) any agreement with any supplier or licensor containing any provision permitting suchsupplier or licensor to change the price or other terms upon a breach or failure by the Company orany of its Subsidiaries, as applicable, to meet its obligations under such agreement; or               (xii) any agreement under which the Company or any of its Subsidiaries has granted any Personregistration rights for securities.          (b) The contracts disclosed in Schedule 5.15(a) to the Disclosure Schedules and thematerial contracts disclosed by the Company in its most recent SEC Reports are herein referred tocollectively as the **“Material Contracts”.**The Company has made available to the InvestorRepresentative copies of the Material Contracts. Neither the Company nor any of its Subsidiarieshas entered into any oral contract that, if written, would qualify as a Material Contract. To theCompany’s knowledge, each of the Material Contracts represents a valid and binding obligation of,and is in full force and effect against, each party thereto (other than the Company and itsSubsidiaries) and is enforceable against each party thereto (other than the Company and itsSubsidiaries) in accordance with its terms (subject to applicable bankruptcy, insolvency,reorganization, fraudulent transfer, moratorium or similar laws affecting creditors’ rightsgenerally and to general principles of equity) and will continue to be so immediately following theClosing Date.          (c) Actions with Respect to Material Contracts.               (i) Neither the Company nor any of its Subsidiaries has violated or breached, or committedany default under, any Material Contract in any material respect, and, to the Company’s knowledge,no other Person has violated or breached, or committed any default under any Material Contract,except for violations, breaches of defaults that would not have a Material Adverse Effect,               (ii) To the Company’s knowledge, no event has occurred and is continuing, and no circumstanceor condition exists, that (with or without notice or lapse of time) will, or would reasonably beexpected to: (A) result in a material violation or breach of any of the provisions of any MaterialContract; (B) give any Person the right to declare a default or exercise any remedy under anyMaterial Contract; (C) give any Person the right to accelerate the maturity or performance of anyMaterial Contract; or (D) give any Person the right to cancel, terminate or modify any MaterialContract, except, in each case, as would not have a Material Adverse Effect.     5.16. **Taxes.**          (a) The Company and its Subsidiaries have timely and properly filed all tax returnsrequired to be filed by them for all years and periods (and portions thereof) for which any
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such tax returns were due, except where the failure to so file would not have a Material AdverseEffect. All such filed tax returns are accurate in all material respects. The Company has timelypaid all taxes due and payable (whether or not shown on filed tax returns), except where thefailure to so pay would not have a Material Adverse Effect. There are no pending assessments,asserted deficiencies or claims for additional taxes that have not been paid and that would have aMaterial Adverse Effect. The reserves for taxes, if any, reflected in the SEC Reports or the in theMemorandum were, as of the dates stated, adequate, and there are no Liens for taxes on any propertyor assets of the Company and any of its Subsidiaries (other than Liens for taxes not yet due andpayable or that would not have a Material Adverse Effect). There have been no audits orexaminations of any tax returns by any Governmental Body, and the Company or its Subsidiaries havenot received any notice that such audit or examination is pending or contemplated. No claim hasbeen made by any Governmental Body in a jurisdiction where the Company or any of its Subsidiariesdoes not file tax returns that it is or may be subject to taxation by that jurisdiction. To theCompany’s knowledge, no state of facts exists or has existed that would constitute grounds for theassessment of any penalty or any further tax liability beyond that shown on the respective taxreturns. There are no outstanding agreements or waivers extending the statutory period oflimitation for the assessment or collection of any tax.          (b) Neither the Company nor any of its Subsidiaries is a party to any tax-sharingagreement or similar arrangement with any other Person.     5.17. **Employees and Labor Relations.**          (a) Each individual who performs services for the Company or any of its Subsidiaries has been,and is, properly classified by the Company or its Subsidiaries as an employee or an independentcontractor, except where the failure to so classify an individual has not had and is not reasonablyanticipated to have a Material Adverse Effect.          (b) To the Company’s knowledge, no employee or advisor of the Company or any of itsSubsidiaries is or is alleged to be in violation of any term of any employment contract, disclosureagreement, proprietary information and inventions agreement or any other contract or agreement orany restrictive covenant or any other common law obligation to a former employer relating to theright of any such employee to be employed by the Company or any of its Subsidiaries because of thenature of the business conducted or to be conducted by the Company or any of its Subsidiaries or tothe use of trade secrets or proprietary information of others, exclusive of any such violation ashas not had and is not reasonably anticipated to have a Material Adverse Effect. There is neitherpending nor, to the Company’s knowledge, threatened any actions, suits, proceedings or claims or,to the Company’s knowledge, any basis therefor or threat thereof with respect to any contract,agreement, covenant or obligation referred to in the preceding sentence, exclusive of any of theforegoing that has not had and is not reasonably anticipated to have a Material Adverse Effect.          (c) No material labor dispute exists or, to the Company’s knowledge, is imminent with respectto any of the employees of the Company that would reasonably be expected to result in a MaterialAdverse Effect.
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     5.18. **Patents and Trademarks.**To the Company’s knowledge, the Company and the Subsidiarieshave, or have rights to use, all patents, patent applications, trademarks, trademark applications,service marks, trade names, copyrights, licenses and other similar rights that are necessary ormaterial for use in connection with their respective businesses as described in the SEC Reports andthe Memorandum and that the failure to so have would have or reasonably be expected to result in aMaterial Adverse Effect (collectively, the **“Intellectual Property Rights”).**Neither the Companynor any Subsidiary has received a written notice that the Intellectual Property Rights used by theCompany or any Subsidiary violates or infringes upon the rights of any Person, exclusive of anysuch violation or infringement as has not had and is not reasonably anticipated to have a MaterialAdverse Effect. To the Company’s knowledge, all such Intellectual Property Rights areenforceable. The Company and its Subsidiaries have taken reasonable steps to protect the Company’sand its Subsidiaries’ rights in their Intellectual Property Rights and confidentialinformation (the **“Confidential Information”)**. Each employee, consultant and contractorwho has had access to Confidential Information that is necessary for the conduct of Company’s andeach of its Subsidiaries’ respective businesses as currently conducted or as currently proposed tobe conducted has executed an agreement to maintain the confidentiality of such ConfidentialInformation and has executed appropriate agreements that are substantially consistent with theCompany’s standard forms thereof, except where the failure of any employee, consultant andcontractor to execute such an agreement has not had and is not reasonably anticipated to have aMaterial Adverse Effect. Except under confidentiality obligations, to the Company’s knowledgethere has been no material disclosure of any of the Company’s or its Subsidiaries’ ConfidentialInformation to any third party, exclusive of any such disclosure as has not had and is notreasonably anticipated to have a Material Adverse Effect.     5.19. **Environmental Matters.**To the Company’s knowledge, neither the Company nor anySubsidiary of the Company is in violation of any statute, rule, regulation, decision or order ofany Governmental Body relating to the use, disposal or release of hazardous or toxic substances orrelating to the protection or restoration of the environment or human exposure to hazardous ortoxic substances (collectively, **“Environmental Laws”)**, owns or operates any real propertycontaminated with any substance that is subject to any Environmental Laws, is liable for anyoff-site disposal or contamination pursuant to any Environmental Laws or is subject to any claimrelating to any Environmental Laws, which violation, contamination, liability or claim has had orwould reasonably be expected to have a Material Adverse Effect, individually or in the aggregate;and there is no pending or, to the Company’s knowledge, threatened investigation that might lead tosuch a claim.     5.20. **Insurance.**The Company and its Subsidiaries are insured by insurers of recognizedfinancial responsibility against such losses and risks and in such amounts as are prudent andcustomary in the businesses in which the Company and its Subsidiaries are engaged. To the Company’sknowledge, the Company and its Subsidiary will be able to renew their existing insurance coverageas and when such coverage expires or obtain similar coverage from similar insurers as may benecessary to continue its business without a significant increase in cost.     5.21. **Private Placement.**Assuming the truth, accuracy and completeness of the
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Investors’ representations and warranties set forth in Sections 3 and 4 and in their respectivequestionnaires, no registration under the Securities Act is required for the offer and sale of theSecurities by the Company to the Investors as contemplated hereby.     5.22. **No Integrated Offering.**Neither the Company nor any of its Affiliates, nor any Personacting on its or their behalf, has, directly or indirectly, made any offers or sales of anysecurity or solicited any offers to buy any security, under circumstances that would cause thisOffering of the Securities to be integrated with prior offerings by the Company for purposes of theSecurities Act or any applicable shareholder approval provisions, including, withoutlimitation, under the rules and regulations of any exchange or automated quotation system on whichany of the securities of the Company is listed or designated.     5.23. **Brokers and Finders.**Other than as described in the Memorandum or as provided in anyof the Transaction Documents or the engagement or similar agreement with the Placement Agent, noPerson will have, as a result of the transactions contemplated by the Transaction Documents, anyvalid right, interest or claim against or upon the Company, any Subsidiary of the Company or anyInvestor for any commission, fee or other compensation pursuant to any agreement, arrangement orunderstanding entered into by or on behalf of the Company.     5.24. **No Directed Selling Efforts or General Solicitation.**Neither the Company nor any Personacting on its behalf has conducted any general solicitation or general advertising (as those termsare used in Regulation D) in connection with the offer or sale of any of the Securities; *provided,however,*that no representation or warranty shall be deemed made hereby with respect to actiontaken by the Placement Agent or any agent or representative thereof.     5.25. **Disclosures.**Neither the Company nor any Person acting on its behalf has provided theInvestors or their agents or counsel with any information that constitutes or might constitutematerial, non-public information, other than the terms of the transactions contemplated hereby;*provided, however,*that no representation or warranty shall be deemed made hereby with respect toany information that may have been provided by the Placement Agent or any agent or representativethereof. The Memorandum does not contain any untrue statement of a material fact or omit to statea material fact necessary in order to make the statements contained therein, in light of thecircumstances under which they were made, not misleading as at the date of such statements.     5.26. **Solvency.**          (a) The Company has not: (i) made a general assignment for the benefit of creditors; (ii)filed any voluntary petition in bankruptcy or suffered the filing of any involuntary petition byits creditors; (iii) suffered the appointment of a receiver to take possession of all, orsubstantially all, of its assets; (iv) suffered the attachment or other judicial seizure of all, orsubstantially all, of its assets; (v) admitted in writing its inability to pay its debts as theycome due; or (vi) made an offer of settlement, extension or composition to its creditors generally.          (b) The Company is, and immediately after the final Closing Date will be,
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Solvent. As used herein, the term **“Solvent”**means, with respect to any Person on a particular date,that on such date: (i) the fair market value of the assets of such Person is greater than the totalamount of liabilities (including contingent liabilities) of such Person; (ii) the present fairsalable value of the assets of such Person is greater than the amount that will be required to paythe probable liabilities of such Person on its debts as they become absolute and matured; (iii)such Person is able to realize upon its assets and pay its debts and other liabilities, includingcontingent obligations, as they mature; and (iv) such Person does not have unreasonably smallcapital. **“Fair salable value”**means the amount that could be obtained for assets within areasonable time, either through collection or through sale under ordinary selling conditions by acapable and diligent seller to an interested buyer who is willing (but under no compulsion) topurchase.     5.27. **Related Party Transactions**. Except as set forth in the SEC Reports or the Memorandum:(a) neither the Company nor, to the Company’s knowledge, any of its Affiliates, officers,directors, stockholders or employees (or any Affiliate of any of such Person), has any materialinterest in any property, real or personal, tangible or intangible, including the Company’sIntellectual Property used in or pertaining to the business of the Company, except for the normalrights of a stockholder or, to the Company’s knowledge, any supplier, distributor or customer ofthe Company, (b) there are no material agreements, understandings or proposed transactions betweenthe Company and any of its officers, directors, employees, Affiliates or, to the Company’sknowledge, any Affiliate thereof that are required to be disclosed in the SEC Reports, (c) to theCompany’s knowledge, no employee, officer or director of the Company or any of its Subsidiaries hasany direct or indirect ownership interest in any firm or corporation that is an Affiliate of theCompany or with which the Company has a material business relationship or any firm or corporationthat materially competes with the Company; (d) to the Company’s knowledge, no member of theimmediate family of any officer or director of the Company is directly or indirectly interested inany Material Contract; or (e) there are no material amounts (whether salary, bonuses or other formsof compensation and whether in cash or stock) owed by the Company to any of its officers, directorsand consultants that are required to be disclosed in the SEC Reports.     5.28. **Questionable Payments.**Neither the Company nor any of its Subsidiaries nor, to theCompany’s knowledge, any of their respective current or former stockholders, directors, officers,employees, agents or other Persons acting on behalf of the Company or any Subsidiary of theCompany, has on behalf of the Company or any Subsidiary or in connection with their respectivebusinesses: (a) used any corporate funds for unlawful contributions, gifts,entertainment or other unlawful expenses relating to political activity; (b) made any direct orindirect unlawful payments to any governmental officials or employees from corporate funds; (c)established or maintained any unlawful or unrecorded fund of corporate monies or other assets; (d)made any false or fictitious entries on the books and records of the Company or any Subsidiary ofthe Company; or (e) made any unlawful bribe, rebate, payoff, influence payment, kickback or otherunlawful payment of any nature.     5.29. **PFIC.**None of the Company and its Subsidiaries is or intends to become a “passiveforeign investment company” within the meaning of Section 1297 of the Code of 1986.
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     5.30. **OFAC.**None of the Company and its Subsidiaries nor, to the Company’s knowledge, anydirector, officer, agent, employee, Affiliate or Person acting on behalf of the Company or any ofits Subsidiaries, is currently subject to any U.S. sanctions administered by the Office of ForeignAssets Control of the U.S. Treasury Department (“**OFAC**”); and the Company will not directly orindirectly use the proceeds of the sale of the Units, or lend, contribute or otherwise makeavailable such proceeds to any of the Company’s Subsidiaries, joint venture partner or other Personor entity, towards any sales or operations in Cuba, Iran, Syria, Sudan, Myanmar or any othercountry sanctioned by OFAC or for the purpose of financing the activities of any Person currentlysubject to any U.S. sanctions administered by OFAC.     5.31. **Money Laundering Laws.**To the Company’s knowledge, the operations of each of the Companyand its Subsidiaries are and have been conducted at all times in compliance with the moneylaundering Legal Requirements of all applicable Governmental Bodies and any related or similarrules, regulations or guidelines, issued, administered or enforced by any Governmental Body(collectively, the **“Money Laundering Laws”)**, and no action, suit or proceeding by or before anycourt or Governmental Body or any arbitrator involving the Company or any of its Subsidiaries withrespect to the Money Laundering Laws is pending or, to the Company’s knowledge, threatened.**6. CONDITIONS TO EACH CLOSING OF THE INVESTORS.**     The obligation of the Investors to purchase the Units at any Closing is subject to thefulfillment, to the satisfaction of the Placement Agent, acting reasonably, on or prior to suchapplicable Closing Date, of the following conditions, any of which may be waived by the PlacementAgent:     6.1. **Representations and Warranties.**The representations and warranties made by the Companyin Section 5 hereof that are qualified as to materiality shall be true and correct when made and onthe applicable Closing Date, except to the extent any such representation or warranty expresslyspeaks as of an earlier date, in which case such representation or warranty shall be true andcorrect as of such earlier date, and the representations and warranties made by the Company inSection 5 hereof that are not qualified as to materiality shall be true and correct in all materialrespects when made and on the applicable Closing Date, except to the extent any such representationor warranty expressly speaks as of an earlier date, in which case such representation or warrantyshall be true and correct in all material respects as of such earlier date.     6.2. **Performance of Agreements**. The Company shall have performed in all material respects allobligations and covenants herein required to be performed by it on or prior to the applicableClosing Date.     6.3. **Approvals.**The Company and the Guarantors shall have obtained any and all consents,permits, approvals, registrations and waivers necessary or appropriate forconsummation of the purchase and sale of the Units and the consummation of the other transactionscontemplated by the Transaction Documents to be consummated by the Company or the Guarantors, asmay be applicable, all of which consents, permits, approvals, registrations andwaivers shall be in full force and effect.
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     6.4. **Judgments, etc.**No judgment, writ, order, injunction, award or decree of or by anycourt, judge, justice or magistrate, including any bankruptcy court or judge, or any order of or byany governmental authority, shall have been issued, and no action or proceeding shall have beeninstituted by any governmental authority, enjoining or preventing the consummation of thetransactions contemplated hereby or in the other Transaction Documents.     6.5. **Stop Orders.**No stop order or suspension of trading shall have been imposed by the SEC,the TSX, the ASIC or the ASX or any other governmental or regulatory body having jurisdiction overthe Company or the market(s) where the Common Stock is listed or quoted, with respect to publictrading in the Common Stock.     6.6. **Adverse Changes.**Since the date of execution of this Agreement, no event or series ofevents shall have occurred that would have or reasonably be expected to result in a MaterialAdverse Effect or a Material Adverse Change.     6.7. **Officer Certificate.**The Company shall have delivered a Certificate, executed on behalfof the Company by its Chief Executive Officer or its Chief Financial Officer or such other seniorofficer as may be acceptable to the Placement Agent, dated as of the applicable Closing Date,certifying to the fulfillment of the conditions specified in this Section 6.     6.8. **Secretary Certificate.**Each of the Company and the Guarantors shall have delivered aCertificate, executed on its behalf by its respective Secretary or such other officer as may beacceptable to the Placement Agent, dated as of the applicable Closing Date, certifying theresolutions adopted by its Board of Directors or other governing body (if any) approving itsexecution, delivery and performance of Transaction Documents to which it is a party, certifying thecurrent versions of its Articles of Incorporation and Bylaws (or other applicable organicdocuments) and certifying as to the signatures and authority of persons signing such TransactionDocuments and related documents on its behalf. The foregoing certificates shall only be requiredto be delivered on the first Closing Date, unless any information contained in such certificateshas changed.     6.9. **Opinions of Counsel.**          (a) The Investors and the Placement Agent shall have received an opinion from Reed Smith LLP,the Company’s U.S. legal counsel, dated as of each Closing Date, in such form and substance asagreed to by the Company and the Placement Agent (it being agreed that such counsel shall not berequired to deliver a “10b-5” or negative assurances letter or opinion).          (b) The Investors and the Placement Agent shall have received an opinion from Boyle & Co. LLP,the Company’s Canadian legal counsel, dated as of each Closing Date, in such form and substance asagreed to by the Company and the Placement Agent (it being agreed that such counsel shall not berequired to deliver a “10b-5” or negative assurances letter or opinion).
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          (c) The Investors and the Placement Agent shall have received a local counsel opinion fromO’Neal Webster, the Company’s British Virgin Islands legal counsel, dated as of each Closing Date,in such form and substance as agreed to by the Company and the Placement Agent (it being agreedthat such counsel shall not be required to deliver a “10b-5” or negative assurances letter oropinion).     6.10. **Note, Warrants and Other Transaction Documents.**The Company shall have delivered theinstruments or certificates representing the Notes and Warrants being sold at the applicableClosing, and such of the Company and the Guarantors as is party to any Transaction Document andeach other party to such Transaction Document shall have executed and delivered such TransactionDocument.     6.11. **TSX Approval.**If required by applicable regulation, the TSX shall have approved theWarrant Shares for listing and provided any other requisite approvals in connection with thetransactions contemplated hereby.**7. CONDITIONS TO EACH CLOSING OF THE COMPANY.**     The obligations of the Company to effect the transactions contemplated by this Agreement tobe effected with any Investor are subject to the fulfillment at or prior to the applicableClosing Date of the conditions listed below.     7.1. **Representations and Warranties.**The representations and warranties made by such Investorin Sections 3 and 4 above and in such Investor’s questionnaire shall be true and correct in allmaterial respects when made and at such Closing Date as if made again on and as of such ClosingDate.     7.2. **Corporate Proceedings.**All corporate and other proceedings required to be undertaken bysuch Investor in connection with the transactions contemplated hereby shall have occurred and alldocuments and instruments incident to such proceedings shall be reasonably satisfactory insubstance and form to the Company.     7.3. **Agreements.**Such Investor shall have completed and executed this Agreement and his, heror its questionnaire substantially in the form annexed hereto as Exhibit E and deliveredthe same to the Company.     7.4. **Purchase Price.**Such Investor shall have delivered or caused to be delivered to theEscrow Account the Purchase Price for the Units being purchased by such Investor.     7.5. **TSX Approval.**If required by applicable regulation, the TSX shall have conditionallyapproved the Warrant Shares for listing and provided any other requisite approvals in connectionwith the transactions contemplated hereby.     7.6. **Minimum Amount.**Subscriptions for the Minimum Amount shall have been provided to andaccepted by the Company.
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     7.7. **Documentation.**The Trust Account Agent and the Investor Representative shall havedelivered the Trust Account Agreement and executed and delivered the Gold Agency Agreement.**8. OTHER AGREEMENTS**     8.1. **Furnishing of Information.**As long as any Investor owns the Securities, the Companycovenants to timely file (or obtain extensions in respect thereof and file within the applicablegrace period) all reports required to be filed by the Company after the date hereof pursuant to theExchange Act. As long as any Investor owns Securities, if the Company is not required to filereports pursuant to such laws, it will prepare and furnish to the Investors and make publiclyavailable in accordance with Rule 144(c) such information as is required for the Investors to sellthe Securities under Rule 144. The Company further covenants that it will take such further actionas any holder of Securities may reasonably request, all to the extent required from time to time toenable such holder to sell such Securities without registration under the Securities Act within thelimitation of the exemptions provided by Rule 144.     8.2. **Integration.**The Company shall not, and shall use its best efforts to ensure that noAffiliate of the Company shall, sell, offer for sale or solicit offers to buy or otherwisenegotiate in respect of any security (as defined in Section 2 of the Securities Act) that would beintegrated with the offer or sale of the Securities in a manner that would require the registrationunder the Securities Act of the sale of the Securities to the Investors, or that would beintegrated with the offer or sale of the Securities for purposes of the rules and regulations ofany Trading Market in a manner that would require stockholder approval of the sale of theSecurities to the Investors.     8.3. **Securities Laws Disclosure; Publicity.**By 9:00 a.m. (New York time) on the Trading Dayfollowing the initial Closing Date and each subsequent Closing Date, the Company shall issue apress release disclosing the transactions contemplated hereby that closed on the initial ClosingDate or such subsequent Closing Date, as may be applicable. By no later than the fourth Trading Dayfollowing the Closing Date the Company will file a Report of Foreign Private Issuer on Form 6-Kdisclosing the Closing and the material terms of this Agreement and the other Transaction Documents(and attach as exhibits thereto the Transaction Documents). In addition, the Company will makesuch other filings and notices in the manner and time required by the SEC and the Trading Market onwhich the Common Stock is listed.     8.4. **Limitation on Issuance of Future Priced Securities.**So long as any Securities remainoutstanding, the Company shall not issue any “Future Priced Securities” as such term is describedby the rules and regulations of FINRA.     8.5. **Listing of Securities.**The Company agrees that: (i) if the Company applies to have theCommon Stock traded on any other Trading Market, it will include in such application the WarrantShares and will take such other action as is necessary or desirable to cause the Warrant Shares tobe listed on such other Trading Market as promptly as possible; and (ii) it will take all actionreasonably necessary to continue the listing and trading of its Common Stock on a Trading Marketand will comply in all material respects with the Company’s reporting, filing and other obligationsunder the bylaws or rules of the Trading Market.
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     8.6. **Controls and Procedures.**Following the Closing, the Company agrees that it will utilizecommercially reasonable efforts to establish and maintain, to the extent required by law, rule orregulation, a system of internal accounting controls sufficient to provide reasonable assurancethat: (i) transactions are executed in accordance with management’s general or specificauthorizations; (ii) transactions are recorded as necessary to permit preparation of financialstatements in conformity with Canadian GAAP and to maintain asset accountability; (iii) access toassets is permitted only in accordance with management’s general or specific authorization; and(iv) the recorded accountability for assets is compared with the existing assets at reasonableintervals and appropriate action is taken with respect to any differences.     8.7. **Make Good.**          (a) The Company projects that it will produce at least 60,000 ounces of gold (the **“ProductionTarget”)**in its fiscal years ending December 31, 2010 and 2011 combined. The Company acknowledgesthat the Placement Agent and the Investors are making their investment decision and valuation ofthe Company based in part based upon these projections.          (b) The Company will notify the Placement Agent in writing, including a certification signedby the Company’s Chief Executive Officer and Chief Financial Officer, within ninety (90) daysfollowing the end of its fiscal year ending December 31, 2011 as to whether it has achieved theProduction Target. If the Company fails to achieve the Production Target, then (subject tosubsection (d) below) the annual interest rate of the Notes shall automatically increase by three(3) additional percentage points, with such increase being applied retroactively beginning onJanuary 15, 2012. If the aforementioned notice or certification will contain any materialnon-public information, then the delivery of such notice or certification to the InvestorRepresentative will be subject to the Investor Representative executing a non disclosure agreementthat is in form and substance reasonably satisfactory to the Company. The Placement Agentacknowledges and agrees that neither the Placement Agent nor any of its Affiliates will make anydecision regarding the purchase or sale, or any other dealings in or with, any securities of theCompany based in whole or in part on any information that is related to the Company or any of itsSubsidiaries and that is provided to the Placement Agent (whether as the placement agent for theOffering or in any other capacity) that is not public information.          (c) If an Investor transfers such Investor’s Note, then the right of such Investor to receivesuch increased interest rate under such Note shall transfer along with such Note to the transfereeof such Note.          (d) The increase in the annual interest rate of the Notes pursuant to this Section 8.7shall not apply if the Company fails to achieve the Production Target due to (i) a taking byeminent domain, requisitions, laws or orders of the Governmental Bodies in which the Company’smining operations are conducted or (ii) the Company’s failure to obtain, timely or at all, therequisite business licenses necessary to conduct the Company’s mining operations from suchGovernmental Bodies (provided that the Company has used commercially reasonable efforts to timelyobtain such business licenses).
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     8.8. **Right of First Refusal.**          (a) From the date hereof until the eighteen (18) month anniversary of the initial ClosingDate, the Company will not (except as provided in or contemplated by the Offering), directly orindirectly, offer, sell, grant any option to purchase, or otherwise dispose of (or announce anyoffer, sale, grant or any option to purchase or other disposition of) any of its or itsSubsidiaries’ secured gold promissory notes having features similar to the Notes (any such offer,sale, grant, disposition or announcement being referred to as a **“Subsequent Placement”**) unless theCompany shall have first complied with this Section 8.8.          (b) The Company shall deliver to each Investor hereunder a written notice (the **“Offer Notice”**)of any proposed or intended issuance or sale or exchange (the **“Offer”**) of the notes being offered(the **“Offered Notes”**) in a Subsequent Placement, which Offer Notice shall (w) identify and describethe Offered Notes, (x) describe the price and other terms upon which they are to be issued, sold orexchanged, and the number or amount of the Offered Notes to be issued, sold or exchanged, (y)identify the Persons (if known) to which or with which the Offered Notes are to be offered, issued,sold or exchanged and (z) offer to issue and sell to or exchange with the Investors all of theOffered Notes, allocated among the Investors (a) based on each Investor’s pro rata portion of thetotal aggregate stated or deemed principal amount of Notes sold hereunder (the **“Basic Amount”**), and(b) with respect to each Investor that elects to purchase its Basic Amount, any additional portionof the Offered Notes attributable to the Basic Amounts of other Investors as such Investor shallindicate it will purchase or acquire should the other Investors subscribe for less than their BasicAmounts (the **“Undersubscription Amount”**), which process shall be repeated until such Investor shallhave an opportunity to subscribe for any remaining Undersubscription Amount.          (c) To accept an Offer, in whole or in part, such Investor must deliver a written notice tothe Company prior to the end of the fifth (5th) Business Day after such Investor’s receipt of theOffer Notice (the **“Offer Period”**), setting forth the portion of such Investor’s Basic Amount thatsuch Investor elects to purchase and, if such Investor shall elect to purchase all of its BasicAmount, the Undersubscription Amount, if any, that such Investor elects to purchase (in eithercase, the **“Notice of Acceptance”**). If the Basic Amounts subscribed for by all Investors are lessthan the total of all of the Basic Amounts, then each Investor who has set forth anUndersubscription Amount in its Notice of Acceptance shall be entitled to purchase, in addition tothe Basic Amounts subscribed for, the Undersubscription Amount it has subscribed for; *provided*,*however*, that, if the Undersubscription Amounts subscribed for exceed the difference between thetotal of all the Basic Amounts and the Basic Amounts subscribed for (the **“AvailableUndersubscription Amount”**), each Investor who has subscribed for any UndersubscriptionAmount shall be entitled to purchase only that portion of the Available Undersubscription Amount asthe Basic Amount of such Investor bears to the total Basic Amounts of all Investors that havesubscribed for Undersubscription Amounts, subject to rounding by the Company to the extent itsdeems reasonably necessary.          (d) The Company shall have twenty (20) Business Days from the expiration of the Offer Periodto (i) offer, issue, sell or exchange all or any part of such Offered Notes as to which a Notice ofAcceptance has not been given by the Investors (the **“Refused Notes”**), but
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only to the offerees described in the Offer Notice (if so described therein) and only upon termsand conditions (including, without limitation, unit prices and interest rates) that are not morefavorable to the acquiring Person or Persons or less favorable to the Company than those set forthin the Offer Notice and (ii) to publicly announce (a) the execution of such Subsequent PlacementAgreement (as defined below), and (b) either (x) the consummation of the transactions contemplatedby such Subsequent Placement Agreement or (y) the termination of such Subsequent PlacementAgreement, which shall be filed with the SEC on an appropriate form with such Subsequent PlacementAgreement and any documents contemplated therein filed as exhibits thereto. If no disclosure hasbeen made by the Company by the end of the twenty (20) Business Day period referred to in thissubsection (d), the Subsequent Placement shall be deemed to have been abandoned and the Investorsshall no longer be deemed to be in possession of any non-public information with respect to theCompany and the proposed Subsequent Placement.          (e) In the event the Company shall propose to sell less than all the Refused Notes (any suchsale to be in the manner and on the terms specified in this Section), then each Investor may, atits sole option and in its sole discretion, reduce the number or amount of the Offered Notesspecified in its Notice of Acceptance to an amount that shall be not less than the number or amountof the Offered Notes that such Investor elected to purchase pursuant to Section 8.8(c) abovemultiplied by a fraction, (i) the numerator of which shall be the number or amount of Offered Notesthe Company actually proposes to issue, sell or exchange (including Offered Notes to be issued orsold to Investors pursuant to Section 8.8(c) above prior to such reduction) and (ii) thedenominator of which shall be the original amount of the Offered Notes. In the event that anyInvestor so elects to reduce the number or amount of Offered Notes specified in its Notice ofAcceptance, the Company may not issue, sell or exchange more than the reduced number or amount ofthe Offered Notes unless and until such Offered Notes have again been offered to the Investors inaccordance with Section 8.8(b) above.          (f) Upon the closing of the issuance, sale or exchange of all or less than all of the RefusedNotes, the Investors shall acquire from the Company, and the Company shall issue to the Investors,the number or amount of Offered Notes specified in the Notices of Acceptance, as reduced pursuantto Section 8.8(e) above if the Investors have so elected, upon the terms and conditions specifiedin the Offer. The purchase by the Investors of any Offered Notes is subject in all cases to thepreparation, execution and delivery by the Company and the Investors of a purchase agreementrelating to such Offered Notes reasonably satisfactory in form and substance to the Investors andtheir respective counsel (such agreement, the **“Subsequent Placement Agreement”**).          (g) Any Offered Notes not acquired by the Investors or other Persons in accordance withSection 8.8(f) above may not be issued, sold or exchanged until they are again offered to theInvestors under the procedures specified in this Agreement.          (h) In exchange for the Company’s willingness to agree to these procedures, each Investorhereby irrevocably agrees that it will hold in strict confidence any and all Offer Notices, theinformation contained therein, and the fact that the Company is contemplating a SubsequentPlacement, until such time as the Company is obligated to make the disclosures
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required by Section 8.8(d), or unless it notifies the Company in writing that it no longer desiresto receive Offer Notices.          (i) Notwithstanding the foregoing, this Section 8.8 shall not apply in respect of an issuanceof promissory notes pursuant to acquisitions or strategic transactions, provided any such issuanceshall only be to a Person that is, itself or through its subsidiaries, an operating company in abusiness synergistic with the business of the Company and in which the Company receives benefits inaddition to the investment of funds, but shall not include a transaction in which the Company isissuing securities primarily for the purpose of raising capital or to an entity whose primarybusiness is investing in securities.     8.9. **Further Assurances.**The Company will, and will cause all of its Subsidiaries to, andtheir management to, use their best efforts to satisfy all of the closing conditions under Section7 and will not take any action that could frustrate or delay the satisfaction of such conditions.In addition, either prior to or following the Closing, the Company will, and will cause each of itsSubsidiaries to, and its and their management to, perform, or cause to be done and performed, allsuch further acts and things, and shall execute and deliver all such other agreements,certificates, instruments and documents, as any other party may reasonably request in order tocarry out the intent and accomplish the purposes of this Agreement and the consummation of thetransactions contemplated hereby.     8.10. **Company’s Obligations with respect to Gold Deliveries.**Each of the InvestorRepresentative, the Investors and the Collateral Agent hereby agrees that the Company’s onlyobligations with respect to any semi-annual delivery of any Gold Deposits on any Gold Delivery Date(as defined in the Notes) shall be to deliver (in the manner set forth in the definition of GoldDeposits) such Gold Deposits on or before such Gold Delivery Date to the Trust Account at JPMorganChase Bank, N.A., London Branch held by the Trust Account Agent for the sole and exclusive benefitof the Investor Representative on behalf of the Investors.**9. MISCELLANEOUS.**     9.1. **Compensation of Placement Agent, Brokers, etc.**Each Investor acknowledges that it isfully aware that the Placement Agent will receive from the Company, in consideration of itsservices as placement agent in respect of the offer and sale of the Units contemplated hereby:          (a) a commission of eight (8) percent of the aggregate Purchase Price of the Units sold ateach Closing, payable in cash; and          (b) a warrant to purchase a number of shares of Common Stock derived by dividing an amountequal to 7% of the initial stated or deemed principal amount of the Notes sold at each Closing byCAD $0.60, which warrant shall otherwise have terms and provisions that are identical to theWarrants.     It is acknowledged that the Placement Agent may share such fees and compensation with otherplacement agents or brokers participating in the transactions contemplated hereby. In
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addition, each Investor acknowledges that it is aware that the Placement Agent will receive fromthe Company payment of all of its accountable fees and expenses, including, but not limited to,all legal fees and expenses incurred in connection with the Offering, up to USD $120,000 in theaggregate.     9.2. **Notices.**All notices, requests, demands and other communications provided in connectionwith this Agreement shall be in writing and shall be deemed to have been duly given at the timewhen hand delivered, delivered by express courier or sent by facsimile (with receipt confirmed bythe sender’s transmitting device) in accordance with the contact information provided below or suchother contact information as the parties may have duly provided by notice.(a) **The Company:**Olympus Pacific Minerals Inc.