manner as specified in Sections 7 and 8.
SECTION 1
DEFINITIONS
In this Agreement, including the paragraphs prior to this definitional
section and any amendment hereto:
(A)
"ABCA" MEANS THE BUSINESS CORPORATIONS ACT
(ALBERTA);
(B)
"ACT" MEANS THE INCOME TAX ACT (CANADA),
TOGETHER WITH ANY AND ALL REGULATIONS PROMULGATED THEREUNDER, AS AMENDED FROM
TIME TO TIME;
(C)
"AFFILIATE" HAS THE MEANING ASCRIBED
THERETO IN THE BUSINESS CORPORATIONS ACT (ALBERTA);
(D)
"AGENT'S COUNSEL" MEANS DAVIS & COMPANY LLP,
OR SUCH OTHER LEGAL COUNSEL AS THE AGENT, WITH THE CONSENT OF THE CORPORATION,
MAY APPOINT;
(E)
"AGENT'S WARRANTS" MEANS THE MEANS THE
AGENT'S COMPENSATION WARRANTS TO ACQUIRE COMMON SHARES PURSUANT TO SECTION 7
HEREOF;
(F)
"AGREEMENT" MEANS THIS AGREEMENT AND NOT
ANY PARTICULAR ARTICLE OR SECTION OR OTHER PORTION EXCEPT AS MAY BE SPECIFIED,
AND WORDS SUCH AS "HERETO", "HEREIN", AND "HEREBY" REFER TO THIS AGREEMENT AS
THE CONTEXT REQUIRES;
(G)
"APPLICABLE SECURITIES LAWS" INCLUDES,
COLLECTIVELY AND WITHOUT LIMITATION, ALL APPLICABLE CANADIAN SECURITIES AND
CORPORATE LAWS, RULES, REGULATIONS, INSTRUMENTS, NOTICES, BLANKET ORDERS,
STATEMENTS, CIRCULARS, PROCEDURES AND POLICIES IN THE SELLING JURISDICTIONS;
(H)
"BUSINESS DAY" MEANS A DAY WHICH IS NOT A
SATURDAY OR SUNDAY OR A LEGAL HOLIDAY IN THE CITY OF CALGARY, ALBERTA;
(I)
"CANADIAN EXPLORATION EXPENSE(S)" OR
"CEE" MEANS CANADIAN EXPLORATION EXPENSE DESCRIBED IN PARAGRAPH (F) OF THE
DEFINITION OF "CANADIAN EXPLORATION EXPENSE" IN SUBSECTION 66.1(6) OF THE ACT OR
THAT WOULD BE DESCRIBED IN PARAGRAPH (H) OF SUCH DEFINITION IF THE REFERENCE
THEREIN TO "PARAGRAPHS (A) TO (D) AND (F) TO (G.1)" WERE A REFERENCE TO
"PARAGRAPH (F)", EXCLUDING AMOUNTS WHICH ARE PRESCRIBED TO CONSTITUTE "CANADIAN
EXPLORATION AND DEVELOPMENT OVERHEAD EXPENSE" UNDER THE ACT, THE AMOUNT OF ANY
ASSISTANCE DESCRIBED IN PARAGRAPH 66(12.6)(A) OF THE ACT AND ANY EXPENSE
DESCRIBED IN PARAGRAPH 66(12.6)(B.1) OF THE ACT;
(J)
"CLOSING DATE" MEANS DECEMBER 20, 2005,
OR SUCH OTHER DATE OR DATES ON OR BEFORE DECEMBER 31, 2005 AS THE AGENT AND THE
CORPORATION MAY MUTUALLY AGREE UPON IN WRITING;
2
(K)
"CLOSING TIME" MEANS 10:00 A.M.(CALGARY
TIME) OR SUCH OTHER TIME, ON THE CLOSING DATE, AS THE AGENT AND THE CORPORATION
MAY AGREE;
(L)
"COMMITMENT AMOUNT" MEANS AN AMOUNT
EQUAL TO $1.30 MULTIPLIED BY THE NUMBER OF FLOW-THROUGH SHARES SUBSCRIBED AND
PAID FOR BY SUBSCRIBERS FOR FLOW-THROUGH SHARES;
(M)
"COMMON SHARES" MEANS THE COMMON SHARES IN THE
CAPITAL OF THE CORPORATION FROM TIME TO TIME;
(N)
"CORPORATION'S COUNSEL" MEANS BURNET,
DUCKWORTH & PALMER LLP, OR SUCH OTHER LEGAL COUNSEL AS THE CORPORATION, WITH THE
CONSENT OF THE AGENT, MAY APPOINT;
(O)
"DEBENTURES" MEANS THE 7% SECURED
CONVERTIBLE DEBENTURES HAVING THE RIGHTS AND ENTITLEMENTS SET FORTH IN THE
INDENTURE;
(P)
"DEEP ALTA" MEANS DEEP WELL OIL & GAS
(ALBERTA) LTD.;
(Q)
"DEEP WELL" MEANS DEEP WELL OIL & GAS INC.;
(R)
"DEEP WELL SHARES" MEANS COLLECTIVELY THE
755,000 COMMON SHARES ISSUED TO DEEP ALTA AND THE 6,795,000 COMMON SHARES ISSUED
TO NORTHERN;
(S)
"DYNAMO CLAIM" MEANS THE POTENTIAL LEGAL
CLAIM BY DYNAMO ENERGY CORPORATION AGAINST SURGE U.S. AND THE CORPORATION
ARISING