Document:

Unassociated Document

Exhibit 10.6

 

Image Entertainment, Inc.

Restricted Stock Award Agreement

 

Image Entertainment, Inc. (the “Company”), pursuant to its 2008 Stock Awards and Incentive Plan (the “Plan”) and this Restricted Stock Award Agreement (the “Agreement”), hereby grants to the person named herein (the “Participant”) a Restricted Stock Award (the “Award”) for the number of shares of the Company’s Common Stock set forth below.  This Award is subject to all of the terms and conditions as set forth herein and in the Plan, which is attached hereto and incorporated herein in its entirety.

 

	
Participant:

	  
	
Date of Grant:

	  
	
Vesting Commencement Date:

	  
	
Number of Shares (“Shares”):

	  
	
Fair Market Value Per Share (Informational, for tax purposes):

	
$

	
0

	
Vesting Schedule:

	  	  

The details of the Award are as follows:

 

1.             Grant Pursuant to Plan.  This Award is granted pursuant to the Plan, which is incorporated herein for all purposes.  The Participant hereby acknowledges receipt of a copy of the Plan and agrees to be bound by all of the terms and conditions of this Agreement and of the Plan.  All capitalized terms in this Agreement shall have the meaning assigned to them in this Agreement, or, if such term is not defined in this Agreement, such term shall have the meaning assigned to it under the Plan.

 

2.             Restricted Stock Award.  The Company hereby grants to the Participant the number of Shares listed above as of the date of grant specified above (the “Grant Date”).  Such number of Shares may be adjusted from time to time pursuant to Paragraph XIII of the Plan.

 

3.             Vesting, Forfeiture of Shares and Leave of Absence.

 

(a)            Vesting.  The Participant shall become vested in the Shares in accordance with the vesting schedule listed above, except as otherwise accelerated pursuant to Paragraph 3(b).  Shares that have vested and are no longer subject to forfeiture according to the vesting schedule listed above are referred to herein as “Vested Shares.”  Shares that are not vested and remain subject to forfeiture under the vesting schedule are referred to herein as “Unvested Shares.”  The Unvested Shares will vest (and to the extent so vested cease to be Unvested Shares remaining subject to forfeiture) in accordance with the vesting schedule listed above.  Collectively, the Unvested Shares and the Vested Shares are referred to herein as the “Shares.”

 

  

  

  

(b)            Forfeiture.  The Participant shall forfeit to the Company any Unvested Shares, if any, in the event that the Participant’s employment or services with the Company terminate for any reason, except (i) as otherwise provided in this Agreement or the Plan; (ii) as otherwise determined by the Committee in its sole discretion, which determination need not be uniform as to all Participants; (iii) the Unvested Shares subject to this Award shall be fully vested upon the death or disability of the Participant, and (iv) the Unvested Shares subject to this Award shall become fully vested upon a Change of Control.

 

(c)            Leave of Absence.  The Committee shall have the discretion to determine whether and to what extent the vesting of Shares shall be tolled during any unpaid leave of absence; provided, however, that in the absence of such determination, vesting of Shares shall be tolled during any such unpaid leave (unless otherwise required by the applicable laws). In the event of military leave, vesting shall toll during any unpaid portion of such leave, provided that, upon a Participant’s returning from military leave (under conditions that would entitle him or her to protection upon such return under the Uniform Services Employment and Reemployment Rights Act), he or she shall be given vesting credit with respect to Shares to the same extent as would have applied had the Participant continued to provide services to the Company throughout the leave on the same terms as he or she was providing services immediately prior to such leave.

 

4.             Section 83(b) Election for Award; Independent Tax Advice.

 

The Participant understands that under Section 83(a) of the Code, the excess of the Fair Market Value of the Unvested Shares on the date the forfeiture restrictions lapse over the purchase price, if any, paid for such Shares will be taxed, on the date such forfeiture restrictions lapse, as ordinary income subject to payroll and withholding tax and tax reporting, as applicable.  For this purpose, the term “forfeiture restrictions” means the right of the Company to receive back any Unvested Shares upon the Participant’s termination of employment or service.  The Participant understands that he or she may elect under Section 83(b) of the Code to be taxed at the time the Unvested Shares are acquired, rather than when and as the Unvested Shares cease to be subject to the forfeiture restrictions.  Such election (an “83(b) Election”) must be filed with the Internal Revenue Service within 30 days from the Grant Date of the Award.  Even if the Fair Market Value of the Unvested Shares on the Grant Date equals the purchase price, if any, (and thus no tax is payable), the Participant must file the election within the 30-day period to avoid the risk of adverse tax consequences in the future.

 

The Participant understands that there are significant risks associated with the decision to make an 83(b) Election.  If the Participant makes an 83(b) Election and the Unvested Shares are subsequently forfeited to the Company, the Participant will not be entitled to a deduction for any ordinary income previously recognized as a result of the 83(b) Election.  If the Participant makes an 83(b) Election and the value of the Unvested Shares subsequently declines, the 83(b) Election may cause the Participant to recognize more compensation income than would otherwise have been recognized.  On the other hand, if the value of the Unvested Shares increases and the Participant has not made an 83(b) Election, the Participant may recognize more compensation income than would have been recognized if the Participant had made the election.

 

THE FORM FOR MAKING AN 83(b) ELECTION IS ATTACHED TO THIS AGREEMENT AS EXHIBIT B.  THE PARTICIPANT UNDERSTANDS THAT, IF HE OR SHE DECIDES TO MAKE AN 83(b) ELECTION, IT IS THE PARTICIPANT’S RESPONSIBILITY TO FILE SUCH AN ELECTION WITH THE INTERNAL REVENUE SERVICE.   FAILURE TO FILE SUCH AN ELECTION WITHIN THE 30-DAY PERIOD MAY RESULT IN THE RECOGNITION OF ORDINARY INCOME BY THE PARTICIPANT AS THE FORFEITURE RESTRICTIONS LAPSE.  The Participant further understands that an additional copy of such election form should be filed with the Participant’s federal income tax return for the calendar year in which the date of this Agreement falls.  The Participant acknowledges that the foregoing is only a summary of the federal income tax laws that apply to the receipt of the Unvested Shares under this Agreement and does not purport to be complete.

 

  

-2-

  

THE PARTICIPANT FURTHER ACKNOWLEDGES THAT THE COMPANY HAS DIRECTED THE PARTICIPANT TO SEEK INDEPENDENT ADVICE REGARDING THE APPLICABLE PROVISIONS OF THE CODE, THE INCOME TAX LAWS OF ANY MUNICIPALITY, STATE OR FOREIGN COUNTRY IN WHICH THE PARTICIPANT MAY RESIDE, AND THE TAX CONSEQUENCES OF THE PARTICIPANT’S DEATH.

 

The Participant agrees to execute and deliver to the Company with this Agreement a copy of the Acknowledgment and Statement of Decision Regarding Section 83(b) Election attached hereto as Exhibit A.  The Participant further agrees to execute and deliver to the Company with this Agreement a copy of the 83(b) Election attached hereto as Exhibit B if the Participant chooses to make such an election.

 

5.             Status as Shareholder.  The Participant will be recorded as a shareholder of the Company with respect to the Shares and will have all the rights of an equity interest holder of the Company, including voting rights; provided, however, that the Participant will not accrue or be entitled to any dividends with respect to the Unvested Shares.

 

6.             Tax Provisions.

 

(a)            Tax Consequences.  The Participant has reviewed with the Participant’s own tax advisors the federal, state, local and foreign tax consequences of this investment and the transactions contemplated by this Agreement.  The Participant is relying solely on such advisors and not on any statements or representations of the Company or any of its agents.  The Participant understands that the Participant (and not the Company) shall be responsible for any tax liability that may arise as a result of the transactions contemplated by this Agreement.

 

(b)            Withholding Obligations.  At the time the Award is granted, or at any time thereafter as requested by the Company, the Participant hereby authorizes withholding from payroll and any other amounts payable to the Participant, including shares of Common Stock deliverable pursuant to this Award, and otherwise agrees to make adequate provision for, any sums required to satisfy the minimum federal, state, local and foreign tax withholding obligations of the Company or an Affiliate, if any, which arise in connection with the Award.

 

The Company, in its sole discretion, and in compliance with any applicable legal conditions or restrictions, may withhold from fully vested shares of Common Stock otherwise deliverable to the Participant upon the vesting of the Award a number of whole shares of Common Stock having a Fair Market Value, as determined by the Company as of the date the Participant recognizes income with respect to those shares of Common Stock, not in excess of the amount of minimum tax required to be withheld by law (or such lower amount as may be necessary to avoid adverse financial accounting treatment).  Any adverse consequences to the Participant arising in connection with such Common Stock withholding procedure shall be the Participant’s sole responsibility.

 

  

-3-

  

In addition, subject to the terms of the Agreement, the Company, in its sole discretion, may establish a procedure whereby the Participant may make an irrevocable election to direct a broker (determined by the Company) to sell sufficient shares of Common Stock from the Award to cover the tax withholding obligations of the Company or any Affiliate and deliver such proceeds to the Company.

 

Unless the tax withholding obligations of the Company or any Affiliate are satisfied, the Company shall have no obligation to issue a certificate for such shares of Common Stock.

 

(c)            Section 409A Amendments.  The Company agrees to cooperate with the Participant to amend this Agreement to the extent either the Company or the Participant deems necessary to avoid imposition of any additional tax or income recognition prior to actual payment to the Participant under Code Section 409A and any Treasury Regulations and Internal Revenue Service guidance thereunder, but only to the extent such amendment would not have an adverse effect on the Company and would not provide the Participant with any additional rights, in each case as determined by the Company, in its sole discretion.

 

7.             Consideration.  The Shares are granted in consideration for the services the Participant shall provide to the Company during the vesting period.

 

8.             Transferability Restrictions.  Vested Shares shall not be sold, assigned, exchanged, negotiated, pledged, hypothecated or disposed of in any way (whether by operation of law or otherwise) or subject to execution, attachment or similar process under this Agreement prior to eighteen months following the Vesting Commencement Date without prior approval of the Board; provided, however, that, prior to expiration of such eighteen-month period, no more than 50% of the total Vested Shares (based on the total number of Shares originally granted that have become vested) may be sold, transferred or otherwise disposed of in any way in one or more transactions during any six-month period, other than pursuant to the terms of a Change of Control, pursuant to a beneficiary designation in the event of death, or by will or the laws of descent and distribution.  Unvested Shares are not transferable and shall not be sold, assigned, exchanged, negotiated, pledged, hypothecated or disposed of in any way (whether by operation of law or otherwise) or subject to execution, attachment or similar process.  Transfer or other disposition of any Vested Shares is subject to compliance with applicable federal and state securities laws.

 

9.             Book Entry Registration of the Shares.  The Company will issue the Shares by registering the Shares in book entry form with the Company’s transfer agent in your name and the applicable restrictions will be noted in the records of the Company’s transfer agent in the book entry system.  No certificate(s) representing all or any part of the Shares will be issued until such Shares become Vested Shares.

 

  

-4-

  

10.           Stop-Transfer Notices.  The Participant understands and agrees that, in order to ensure compliance with the restrictions referred to in this Agreement, the Company may issue appropriate “stop-transfer” instructions to its transfer agent, if any, and that, if the Company transfers its own securities, it may make appropriate notations to the same effect in its own records.  The Company will not be required to (a) transfer on its books any Shares that have been sold or transferred in violation of the provisions of this Agreement or (b) treat as the owner of the Shares, or otherwise accord voting, dividend or liquidation rights to, any transferee to whom the Shares have been transferred in contravention of this Agreement.

 

11.           General Provisions.

 

(a)            Employment at Will.  Nothing in this Agreement or in the Plan shall confer upon the Participant any right to continue in the service of the Company or its Affiliates for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Company (or any Affiliate employing or retaining the Participant) or of the Participant, which rights are hereby expressly reserved by each, to terminate the Participant’s service at any time for any reason, with or without cause.

 

(b)            Notices.  Any notice required to be given under this Agreement shall be in writing and shall be deemed effective upon personal delivery or upon deposit in the U.S. mail, registered or certified, postage prepaid and properly addressed to the party entitled to such notice at the address indicated below such party’s signature line on this Agreement or at such other address as such party may designate by ten (10) days’ advance written notice under this paragraph to all other parties to this Agreement.

 

(c)            No Limit on Other Compensation Arrangements.  Nothing contained in this Agreement shall preclude the Company from adopting or continuing in effect other or additional compensation arrangements, and those arrangements may be either generally applicable or applicable only in specific cases.

 

(d)            Severability.  If any provision of this Agreement is or becomes or is deemed to be invalid, illegal, or unenforceable in any jurisdiction or would disqualify this Agreement or the Award under any applicable law, that provision shall be construed or deemed amended to conform to applicable law (or if that provision cannot be so construed or deemed amended without materially altering the purpose or intent of this Agreement and the Award, that provision shall be stricken as to that jurisdiction and the remainder of this Agreement and the Award shall remain in full force and effect).

 

(e)            No Trust or Fund Created.  Neither this Agreement nor the grant of the Award shall create or be construed to create a trust or separate fund of any kind or a fiduciary relationship between the Company and the Participant or any other person.  To the extent that the Participant or any other person acquires a right to receive shares of Common Stock from the Company pursuant to this Agreement, that right shall be no greater than the right of any unsecured general creditor of the Company.

 

(f)             Cancellation of Award.  If any Unvested Shares subject to this Agreement are forfeited, then from and after such time, the Participant (and any other person from whom such Unvested Shares are forfeited) shall no longer have any rights to such Unvested Shares.  Such Unvested Shares shall be deemed forfeited in accordance with the applicable provisions hereof.

 

  

-5-

  

(g)            Participant Undertaking.  The Participant hereby agrees to take whatever additional action and execute whatever additional documents the Company may deem necessary or advisable in order to carry out or effect one or more of the obligations or restrictions imposed on either the Participant or the shares of Common Stock deliverable pursuant to the provisions of this Agreement.

 

(h)            Amendment, Modification, and Entire Agreement.  No provision of this Agreement may be modified, waived or discharged unless that waiver, modification or discharge is agreed to in writing and signed by the Participant and the Committee.  This Agreement constitutes the entire contract between the parties hereto with regard to the subject matter hereof.  This Agreement is made pursuant to the provisions of the Plan and shall in all respects be construed in conformity with the terms of the Plan.  In the event of a conflict between the Plan and this Agreement, the terms of the Plan shall govern.  The Participant further acknowledges that as of the Grant Date, this Agreement and the Plan set forth the entire understanding between the Participant and the Company regarding the acquisition of Shares pursuant to this Award and supersede all prior oral and written agreements on that subject with the exception of awards from the Company previously granted and delivered to the Participant.  No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which are not set forth expressly in this Agreement.

 

(i)             Governing Law.  This Agreement shall be governed by, and construed in accordance with, the laws of the State of California without regard to the conflict-of-laws rules thereof or of any other jurisdiction.

 

(j)             Interpretation.  The Participant accepts this Award subject to all the terms and provisions of this Agreement and the terms and conditions of the Plan.  The undersigned Participant hereby accepts as binding, conclusive and final all decisions or interpretations of the Committee upon any questions arising under this Agreement.

 

(k)            Successors and Assigns.  The provisions of this Agreement shall inure to the benefit of, and be binding upon, the Company and its successors and assigns and upon the Participant, the Participant’s assigns and the legal representatives, heirs and legatees of the Participant’s estate, whether or not any such person shall have become a party to this Agreement and have agreed in writing to join herein and be bound by the terms hereof.  The Company may assign its rights and obligations under this Agreement, including, but not limited to, the forfeiture provision of Paragraph 3(b) to any person or entity selected by the Board.

 

(l)             Counterparts.  This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument.

 

(m)           Headings.  Headings are given to the Paragraphs and Subparagraphs of this Agreement solely as a convenience to facilitate reference.  The headings shall not be deemed in any way material or relevant to the construction or interpretation of this Agreement or any provision thereof.

 

  

-6-

  

12.           Representations.  The Participant acknowledges and agrees that the Participant has reviewed the Agreement in its entirety, has had an opportunity to obtain the advice of counsel prior to executing and accepting the Award and fully understands all provisions of the Award.

 

 

[Remainder of page is intentionally blank]

 

  

-7-

  

IN WITNESS WHEREOF, the parties have executed this Restricted Stock Award Agreement on the day and year first indicated above.

 

	  	
Image Entertainment, Inc.

	  	  	 	  
	  	  	 	  
	  	
By:

	 	  
	  	  	 	  
	  	
Title:  

	 	  
	  	  	 	  
	  	
Address:            

	  
	  	  	 	  
	  	  	 	  
	  	  	 	  
	  	  	 	  
	  	
Participant

	  	  	 	  
	  	  	 	  
	  	  	 	  
	  	
Address:

	  
	  	  	 	  
	  	  	 	  

  

 

  

 

EXHIBIT A

ACKNOWLEDGMENT AND STATEMENT OF DECISION

REGARDING SECTION 83(b) ELECTION

 

The undersigned, a recipient of ______ shares of Common Stock of Image Entertainment, Inc., a Delaware corporation (the "Company"), pursuant to a restricted stock award granted pursuant to the Company's 2008 Stock Awards and Incentive Plan (the "Plan"), hereby states as follows:

 

1.    The undersigned acknowledges receipt of a copy of the Plan relating to the offering of such shares.  The undersigned has carefully reviewed the Plan and the Restricted Stock Award Agreement pursuant to which the award was granted.

 

	 	
2. 

	
The undersigned either (check and complete as applicable):

 

	 	
(a) ___

	
has consulted, and has been fully advised by, the undersigned's own tax advisor, ________________________, whose business address is _________________________, regarding the federal, state and local tax consequences of receiving shares under the Plan, and particularly regarding the advisability of making an election pursuant to Section 83(b) of the Internal Revenue Code of 1986, as amended (the "Code"), and pursuant to the corresponding provisions, if any, of applicable state law, or

 

	 	
(b) ___

	
has knowingly chosen not to consult such a tax advisor.

 

	 	
3. 

	
The undersigned hereby states that the undersigned has decided (check as applicable)

 

	 	
(a) ___

	
to make an election pursuant to Section 83(b) of the Code, and is submitting to the Company, together with the undersigned's executed Restricted Stock Award Agreement, an executed form entitled "Election Under Section 83(b) of the Internal Revenue Code of 1986", or

 

	 	
(b) ___

	
not to make an election pursuant to Section 83(b) of the Code.

 

4.   Neither the Company nor any affiliate or representative of the Company has made any warranty or representation to the undersigned with respect to the tax consequences of the undersigned's purchase of shares under the Plan or of the making or failure to make an election pursuant to Section 83(b) of the Code or the corresponding provisions, if any, of applicable state law.

 

	
Dated:

	  	  	  
	  	  	  	
Recipient

	  	  	  	  
	
Dated:

	  	  	  
	  	  	  	
Recipient's Printed Name

	  	  	  	  
	  	  	  	  
	  	  	  	
Spouse of Recipient

	  	  	  	  
	  	  	  	  
	  	  	  	
Spouse's Printed Name

  

 

  

 

EXHIBIT B

ELECTION UNDER SECTION 83(b)

OF THE INTERNAL REVENUE CODE OF 1986

 

The undersigned taxpayer hereby elects, pursuant to Section 83(b) of the Internal Revenue Code, to include in taxpayer's gross income for the current taxable year the amount of any compensation taxable to taxpayer in connection with taxpayer's receipt of the property described below:

 

	
1. 

	
The name, address, taxpayer identification number and taxable year of the undersigned are as follows:

 

NAME OF TAXPAYER:  ____________________________

NAME OF SPOUSE:  _______________________________

ADDRESS:  ______________________________________

                      ______________________________________

IDENTIFICATION NO. OF TAXPAYER: ________________

IDENTIFICATION NO. OF SPOUSE: ___________________

TAXABLE YEAR:  2010

 

	
2. 

	
The property with respect to which the election is made is described as follows:  _________ shares of the Common Stock of Image Entertainment, Inc., a Delaware corporation (the "Company").

 

	
3. 

	
The date on which the property was transferred is:  September 17, 2010

 

	
4. 

	
The property is subject to the following restrictions:

 

The property is subject to a right pursuant to which taxpayer forfeits the rights in and to the shares if the taxpayer's service with the Company is terminated.  The forfeiture right lapses in a series of installments over a three year period ending on August 5, 2013.

 

	
5. 

	
The aggregate fair market value at the time of transfer, determined without regard to any restriction other than a restriction which by its terms will never lapse, of such property is:  $____________

 

	
6. 

	
The amount (if any) paid for such property is:  $0.00

 

The undersigned has submitted a copy of this statement to the person for whom the services were performed in connection with the undersigned's receipt of the above described property.  The undersigned is the person performing the services in connection with the transfer of said property.

 

The undersigned understands that the foregoing election may not be revoked except with the consent of the Commissioner.

 

	
Dated:

	  	  	  
	  	  	  	
Recipient

	
Dated:

	  	  	  
	  	  	  	
Recipient's Spouse

 

  

 

  

 

Distribution of Copies

	
1.

	
File original with the Internal Revenue Service Center where the taxpayer's income tax return will be filed.  Filing must be made by no later than 30 days after the date the property was transferred.

	
2.

	
Attach one copy to the taxpayer's income tax return for the taxable year in which the property was transferred.

	
3.

	
Mail one copy to the Company at the following address:

Image Entertainment, Inc.

20525 Nordhoff Street, Suite 200

Chatsworth, California 91311Unassociated Document

     

    AGENCY AGREEMENT

     

    November
12, 2010

     

    Midway
Gold Corp.

    Point at Inverness, Suite 280

    8310 South Valley
Highway

    Englewood, Colorado 80112

     

    Attention:  Kenneth
Brunk, President and Chief Operating Officer

     

    Dear
Sir:

     

    Haywood
Securities Inc. (the “Agent”) understands that
Midway Gold Corp., a corporation organized and existing under the laws of
British Columbia (the “Company”), intends to issue
and sell an aggregate of 6,660,000 units (the “Units”) at a price (the “Offer Price”) of US$0.60 per
Unit, each unit being comprised of one common share of the Company (an “Offered Share”) and one half of one
common share purchase warrant.  Each whole common share purchase
warrant (a “Warrant”)
will entitle the holder to acquire one common share a (“Warrant Share”) at a price of
US$0.90 per Warrant Share at any time prior to 5:00 p.m. (Vancouver time) on or
before the date that is 24 months from the Closing Date (as defined below);
provided that, if at any time during the 24 months
after the Closing Date the common shares trade at a volume weighted average
trading price greater than $1.15 on the NYSE Amex Equities Exchange ("Amex"), or
such other stock exchange where the majority of the trading volume of the common
shares occurs, for a period of 20 consecutive trading days, the Company may, by
giving notice to the holders of Warrants to such effect, accelerate the expiry
time of the Warrants to 5:00 p.m. (Vancouver Time) on that date which is 30 days
after the date on which such notice is given.  The Warrants will be
issued pursuant to a Warrant Indenture (as defined below) that provides for,
inter alia, the
appropriate adjustment in the class, number and price of the Warrant Shares to
be issued upon exercise of the Warrants upon the occurrence of certain events,
including any subdivision, consolidation or reclassification of the common
shares of the Company, and the amalgamation of the Company, and other terms and
conditions customary for agreements of that nature.

     

    In
connection with the Offering, we understand that the Company wishes to appoint
the Agent as exclusive agent of the Company for the purpose of offering for
sale, on a best efforts basis, the Units (the “Offering”).

     

    As used
herein, “Base
Prospectuses” shall mean, collectively, the Canadian Base Prospectus and
the U.S. Base Prospectus (each as defined below); “Pricing Prospectuses” shall
mean, collectively, the Canadian Pricing Prospectus and the U.S. Pricing
Prospectus (each as defined below); and “Prospectuses” shall mean,
collectively, the Canadian Prospectus and the U.S. Prospectus (each as defined
below).

     

    
      	
              1.

            	
              Representations
      and Warranties of the Company.

            

    

     

    The Company represents and warrants to,
and agrees with, the Agent that:

     

    
      	
              (a)

            	
              The Company is qualified to file a
      short form prospectus pursuant to the Shelf Procedures (as defined below) and has
      prepared and filed a preliminary short form base shelf prospectus dated
      April 15, 2010 (the “Canadian
      Preliminary Base Shelf Prospectus”) and a final short form base
      shelf prospectus dated May 4, 2010 (the “Canadian Final
      Base Shelf
      Prospectus”) providing for the offer and
      sale, from time to time, of up to US$25,000,000 of the Company’s common shares, warrants to
      purchase common shares, or any combination of common shares or warrants,
      with the British Columbia Securities Commission, as principal regulator
      pursuant to Multilateral Instrument 11-101 – Principal Regulator System (the
      “Reviewing
      Authority”) and the Canadian securities
      regulatory authorities in each of the Canadian Jurisdictions (as defined
      below), (collectively, the “Canadian
      Qualifying Authorities”); and the Reviewing Authority has
      issued a prospectus receipt under National Policy 11-202 - Process for
      Prospectus Reviews in Multiple Jurisdictions (a “Decision
      Document”) on behalf of the Canadian
      Qualifying Authorities for each of the Canadian
      Preliminary Base Shelf Prospectus and the Canadian Final Base Shelf
      Prospectus.  The term “Canadian
      Jurisdictions” means each of the provinces of
      British
      Columbia,
      Alberta and Ontario.  The term
      “Canadian Base
      Prospectus” means the Canadian Final Base Shelf
      Prospectus, including documents incorporated therein by reference, at the
      time the Reviewing Authority issued a Decision Document with respect
      thereto in accordance with the rules and procedures established under all
      applicable securities laws in each of the
      Canadian Jurisdictions and the respective regulations and rules under such
      laws together with applicable published policy statements and instruments
      of the securities regulatory authorities in the Canadian Jurisdictions
      (“Canadian
      Securities Laws”), including National Instrument
      44-101 - Short Form Prospectus Distributions and National Instrument
      44-102 - Shelf Distributions (together, the “Shelf
      Procedures”).  The term
      “Canadian Pricing
      Prospectus” means the preliminary prospectus supplement (the “Canadian Preliminary Prospectus
      Supplement”) relating to the Offering filed with the Canadian
      Qualifying Authorities in accordance with the Shelf Procedures on November
      2, 2010, together with the Canadian Base Prospectus, including all
      documents incorporated therein by reference.  The term “Canadian Prospectus”
      means the prospectus supplement (the “Canadian Prospectus
      Supplement”) relating to the Offering to be dated the date hereof
      and filed with the Canadian Qualifying Authorities in accordance with the
      Shelf Procedures, together with the Canadian Base Prospectus, including
      all documents incorporated therein by reference.  No order suspending the
      distribution of the Units or any other securities of the Company has been
      issued by any of the
      Canadian Qualifying Authorities and no proceedings for that purpose have
      been instituted or are pending or, to the knowledge of the Company, are
      contemplated by the Canadian Qualifying Authorities, and any request on
      the part of the Canadian Qualifying Authorities for additional
      information has been complied
with.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    All
references in this Agreement to the Canadian Preliminary Base Shelf Prospectus,
the Canadian Final Base Shelf Prospectus, the Canadian Preliminary Prospectus
Supplement and the Canadian Prospectus Supplement, or any amendments or
supplements to any of the foregoing, shall be deemed to include any copy thereof
filed with the Canadian Qualifying Authorities pursuant to the System for
Electronic Document Analysis and Retrieval (SEDAR).

     

    
      	
              (b)

            	
              The Company meets the general
      eligibility requirements to file a registration statement on Form S-3
      under the United States Securities Act of 1933, as amended (the
      “Securities
      Act”) and has
      prepared and filed with the United States Securities and Exchange
      Commission (the “Commission”) a registration statement under
      the Securities Act and the rules and regulations of the Commission (the
      “Rules and
      Regulations”) on Form
      S-3 (No. 333-165842),
      on April 1, 2010, providing for the registration of up to
      US$25,000,000 of the
      Company’s common shares, warrants to
      purchase common shares, or any combination of common shares and
      warrants.  Such registration statement, including the exhibits
      to such registration statement and all documents incorporated by reference
      in the prospectus contained therein,
      became effective pursuant to Rule 461 under the Securities Act on May 6,
      2010.  Such registration statement at any given time, as amended
      to such time, including any exhibits and all documents incorporated
      therein by reference, and the documents otherwise
      deemed to be a part thereof or included therein by the Securities Act and
      the Rules and Regulations, is referred to herein as the “Registration
      Statement”.  The base prospectus
      contained in the Registration Statement at the time it became effective, with such
      additions thereto and deletions therefrom as permitted by Rule 424(b) of
      the Securities Act, filed by the Company with the Commission pursuant to
      Rule 424(b)(3) of the Securities Act on May 7, 2010, is referred to herein
      as the “U.S. Base
      Prospectus”.  The term
      “U.S. Pricing
      Prospectus” means the preliminary prospectus
      supplement (the “U.S.
      Preliminary Prospectus Supplement”) relating to the Offering filed
      with the Commission pursuant to Rule 424(b)(2) on November  2,
      2010, together with
      the U.S. Base Prospectus, including all documents incorporated therein by
      reference.  The term “U.S.
      Prospectus” means the prospectus supplement
      (the “U.S. Prospectus
      Supplement”) relating to the Offering to be
      dated the date hereof and filed with the Commission pursuant to
      Rule 424(b)(2), together with the U.S. Base Prospectus, including all
      documents incorporated therein by reference.  No stop order suspending the
      effectiveness of the Registration Statement has been issued under the
      Securities Act and no proceedings for that purpose have been instituted or
      are pending or, to the knowledge of the Company, are contemplated by the
      Commission and any request on the part of the Commission for additional
      information has been complied
with.

            

    

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    Any
“issuer free writing prospectus” (as defined in Rule 433 under the Securities
Act) relating to the Units is hereafter referred to as an “Issuer Free Writing
Prospectus”; and the U.S. Pricing Prospectus, as supplemented by any
Issuer Free Writing Prospectuses issued at or prior to the Applicable Time, and
the information listed in Schedule “C” hereto, taken together, are hereafter
referred to collectively as the “Pricing Disclosure
Package”.  Any reference herein to the U.S. Base Prospectus,
the U.S. Pricing Prospectus and the U.S. Prospectus shall be deemed to refer to
and include the documents incorporated by reference therein as of the date of
filing thereof; and any reference herein to any “amendment” or “supplement” with
respect to any of the U.S. Base Prospectus, the U.S. Pricing Prospectus and the
U.S. Prospectus shall be deemed to refer to and include (i) the filing of any
document with the Commission incorporated or deemed to be incorporated therein
by reference after the date of filing of such U.S. Base Prospectus, U.S. Pricing
Prospectus or U.S. Prospectus and (ii) any such document so filed.

     

    The
Company was not an “ineligible issuer” (as defined in Rule 405 under the
Securities Act) as of the eligibility determination date for purposes of Rules
164 and 433 under the Securities Act with respect to the Offering contemplated
hereby.

     

    All
references in this Agreement to the Registration Statement, the U.S. Base
Prospectus, the U.S. Pricing Prospectus or the U.S. Prospectus, or any Issuer
Free Writing Prospectus, or any amendments or supplements to any of the
foregoing, shall be deemed to include any copy thereof filed with the Commission
pursuant to its Electronic Data Gathering, Analysis and Retrieval System
(EDGAR).

     

    
      	
              (c)

            	
              The Canadian Base Prospectus and
      the Canadian Pricing Prospectus did, and the Canadian Prospectus (and any
      further amendments or supplements thereto) will, comply in all material
      respects with the applicable requirements of Canadian Securities Laws; the
      Canadian Pricing Prospectus, as of the time of filing thereof, did not,
      and the Canadian Prospectus (and any further amendments or supplements
      thereto) will not, as of the time of filing thereof and through the
      Closing Date, include any untrue statement of a material fact or omit to
      state a material fact that is required to be stated or necessary in order
      to make the statements therein, in light of the circumstances under which
      they were made, not false or misleading, and the Canadian Pricing
      Prospectus, as of the time of filing thereof, constituted, and the
      Canadian Prospectus (and any further amendments or supplements thereto)
      will, as of the time of filing thereof and through the Closing Date,
      constitute, full, true and plain disclosure of all material facts relating
      to the Units and to the Company; provided, however, that this
      representation and warranty shall not apply to any information contained
      in or omitted from the Canadian Pricing Prospectus or the Canadian
      Prospectus or any amendment thereof or supplement thereto in reliance upon
      and in conformity with information furnished in writing to the Company by
      or on behalf of the Agent specifically for use therein.  The
      parties hereto agree that such information provided by or on behalf of the
      Agent consists solely of the material referred to in Section 16
      hereof.

            

    

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    
      	
              (d)

            	
              The Registration Statement
      complies, and the U.S. Prospectus and any further amendments or
      supplements to the Registration Statement or the U.S. Prospectus will
      comply, in all material respects with the applicable provisions of the
      Securities Act and the Rules and Regulations, and do not and will not, as
      of the applicable effective date as to each part of the Registration
      Statement and as of the applicable filing date as to the U.S. Prospectus
      and any amendment thereof or supplement thereto, contain an untrue
      statement of a material fact or omit to state a material fact required to
      be stated therein or necessary in order to make the statements therein (in
      light of the circumstances under which they were made, in the case of the
      U.S. Prospectus) not misleading; provided, however, that this
      representation and warranty shall not apply to any information contained
      in or omitted from the Registration Statement or the U.S. Prospectus or
      any amendment thereof or supplement thereto in reliance upon and in
      conformity with information furnished in writing to the Company by or on
      behalf of the Agent specifically for use therein.  The parties
      hereto agree that such information provided by or on behalf of the Agent
      consists solely of the material referred to in Section 16
      hereof.

            

    

     

    
      	
              (e)

            	
              No order preventing or suspending
      the use of the U.S. Base Prospectus, the U.S. Pricing Prospectus or any
      Issuer Free Writing Prospectus has been issued by the Commission, and the
      U.S. Pricing Prospectus, at the time of filing thereof, complied in all
      material respects with the applicable provisions of the Securities Act and
      the Rules and Regulations, and did not contain an untrue statement of a
      material fact or omit to state a material fact required to be stated
      therein or necessary to make the statements therein, in light of the
      circumstances under which they were made, not misleading; provided,
      however, that this representation and warranty shall not apply to any
      information contained in or omitted from the U.S. Pricing Prospectus in
      reliance upon and in conformity with information furnished in writing to
      the Company by or on behalf of the Agent specifically for use
      therein.  The parties hereto agree that such information
      provided by or on behalf of the Agent consists solely of the material
      referred to in Section 16
hereof.

            

    

     

    
      	
              (f)

            	
              For purposes of this Agreement,
      the “Applicable Time” is 9:00 a.m. (Vancouver time) on the date of this
      Agreement.  The Pricing Disclosure Package, as of the Applicable
      Time, did not, and from the Applicable Time through the Closing Date, will
      not, contain an untrue statement of a material fact or omit to state a
      material fact required to be stated therein or necessary to make the
      statements therein, in light of the circumstances under which they were
      made, not misleading.  Each Issuer Free Writing Prospectus
      complies in all material respects with the applicable provisions of the
      Securities Act and the Rules and Regulations, and does not include
      information that conflicts with the information contained in the
      Registration Statement, the Pricing Prospectuses or the Prospectuses, and
      any Issuer Free Writing Prospectus, as supplemented by and taken together
      with the Pricing Disclosure Package as of the Applicable Time, did not
      contain an untrue statement of a material fact or omit to state a material
      fact required to be stated therein or necessary to make the statements
      therein, in light of the circumstances under which they were made, not
      misleading.  No representation and warranty is made in this
      Section 1(f) with respect to any information contained in or omitted from
      the Pricing Disclosure Package or any Issuer Free Writing Prospectus in
      reliance upon and in conformity with information furnished in writing to
      the Company by or on behalf of the Agent specifically for use
      therein.  The parties hereto agree that such information
      provided by or on behalf of the Agent consists solely of the material
      referred to in Section 16
hereof.

            

    

     

    
      	
              (g)

            	
              Each document filed or to be filed
      with the Canadian Qualifying Authorities and incorporated, or deemed to be
      incorporated, by reference in the Canadian Prospectus complied, or will
      comply, when so filed in all material respects with the requirements of
      Canadian Securities Laws, and none of such documents contained, or will
      contain, at the time of its filing any untrue statement of a material fact
      or omitted or will omit at the time of its filing to state a material fact
      required to be stated therein or necessary to make the statements therein,
      in light of the circumstances under which they were or are made, not false
      or misleading.

            

    

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    
      	
              (h)

            	
              KPMG LLP, who have audited the
      consolidated financial statements of the Company and its subsidiaries that
      are included or incorporated by reference in the Registration Statement,
      the Pricing Prospectuses and the Prospectuses, and whose reports appear or
      are incorporated by reference in the Registration Statement, the Pricing
      Prospectuses and the Prospectuses are independent with respect to the
      Company as required by Canadian Securities Laws and are independent public
      accountants as required by the Securities Act, the United States
      Securities Exchange Act of 1934, as amended (the “Exchange
      Act”), the Rules and
      Regulations and the rules of the Public Company Accounting Oversight
      Board.

            

    

     

    
      	
              (i)

            	
              Subsequent to the respective dates
      as of which information is given in the Registration Statement, the
      Pricing Prospectuses and the Prospectuses, except as disclosed in the
      Pricing Prospectuses and the Prospectuses, (i) the Company has not
      declared or paid any dividends, or made any other distribution of any
      kind, on or in respect of its share capital, (ii) there has not been any
      material change in the share capital or long-term or short-term debt of
      the Company or any of its subsidiaries (each, a “Subsidiary” and, collectively, the
      “Subsidiaries”), (iii) neither the Company nor
      any Subsidiary has sustained any material loss or interference with its
      business or properties from fire, explosion, flood, hurricane, accident or
      other calamity, whether or not covered by insurance, or from any labour
      dispute or any legal or governmental proceeding, and (iv) there has not
      been any material adverse change or any development involving a
      prospective material adverse change, whether or not arising from
      transactions in the ordinary course of business, in or affecting the
      business, general affairs, management, condition (financial or otherwise),
      results of operations, shareholders’ equity, properties or prospects of
      the Company and the Subsidiaries, taken as a whole (a “Material
      Adverse Change”).  Since the date of
      the latest balance sheet included, or incorporated by reference, in the
      Registration Statement, the Pricing Prospectuses and the Prospectuses,
      neither the Company nor any Subsidiary has incurred or undertaken any
      liabilities or obligations, whether direct or indirect, liquidated or
      contingent, matured or unmatured, or entered into any transactions,
      including any acquisition or disposition of any business or asset, which
      are material to the Company and the Subsidiaries, taken as a whole, except
      for liabilities, obligations and transactions which are disclosed in the
      Pricing Prospectuses and the
  Prospectuses.

            

    

     

    
      	
              (j)

            	
              Except under laws of general
      application, no Subsidiary listed in Exhibit A hereto (each, a
      “Material
      Subsidiary” and,
      collectively, the “Material
      Subsidiaries”) is
      currently prohibited, directly or indirectly, from paying any dividends to
      the Company, from making any other distribution on such Material
      Subsidiary’s capital stock, from repaying to the Company any loans or
      advances to such Material Subsidiary from the Company or from transferring
      any of such Material Subsidiary’s property or assets to the Company or any
      other Subsidiary of the
Company.

            

    

     

    
      	
              (k)

            	
              The Company has an authorized and
      outstanding capitalization as set forth in the Pricing Prospectuses and
      the Prospectuses, and all of the issued and outstanding share capital of
      the Company are fully paid and non-assessable and have been duly and validly
      authorized and issued, in compliance with all applicable
      Canadian, United States and other securities laws and not in violation of or
      subject to any pre-emptive or similar right that entitles any person to
      acquire from the Company or any Subsidiary any common shares of the
      Company or other security of the Company or any security convertible into,
      or exercisable or exchangeable for, common shares of the Company or any
      other such security (any “Relevant
      Security”), except
      for such rights as may have been fully satisfied or waived prior to the
      effectiveness of the Registration Statement.  All of the issued
      share capital of or other ownership interests in each Material Subsidiary
      have been duly and validly authorized and issued and are fully paid and
      non-assessable and (except as otherwise set forth in the Pricing
      Prospectuses and the Prospectuses) are owned directly or indirectly by the
      Company free and clear of any lien, charge, mortgage,
      pledge, security interest, claim, or other encumbrance of any kind
      whatsoever (any “Lien”).

            

    

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    
      	
              (l)

            	
              The Company has full corporate
      capacity, power and authority to execute this Agreement, the Warrant
      Indenture and the certificates representing the Warrants and to perform
      its obligations set out herein and therein and this Agreement is and the
      Warrant Indenture and the certificates representing the Warrants will be,
      on the Closing Date, duly authorized, executed and delivered by the
      Company, and this Agreement is and the Warrant Indenture and the
      certificates representing the Warrants will be, on the Closing Date,
      legal, valid and binding obligations of the Company enforceable against
      the Company in accordance with their terms subject to laws relating to
      creditors’ rights generally and except as rights to indemnity may be
      limited by applicable law.

            

    

     

    
      	
              (m)

            	
              The Offered Shares to be delivered
      on the Closing Date have been duly and validly authorized, the Company
      will reserve or set aside sufficient shares in its treasury to issue the
      Warrant Shares and, when issued and delivered in accordance with this
      Agreement, the Warrant Indenture and the warrant certificates, as
      applicable, will be duly and validly issued, fully paid and
      non-assessable, will have been issued in compliance with all
      applicable Canadian, United States and other securities laws and will not have been issued in
      violation of or subject to any pre-emptive or similar right that entitles
      any person to acquire any Relevant Security from the
      Company.

            

    

     

    
      	
              (n)

            	
              The Units, Offered Shares and the
      Warrants conform to the descriptions thereof contained in the Registration
      Statement, the Pricing Prospectuses and the
      Prospectuses.  Except as disclosed in the Pricing Prospectuses
      and the Prospectuses, the Company has no outstanding warrants, options to
      purchase, or any pre-emptive rights or other rights to subscribe for or to
      purchase, or any contracts or commitments to issue or sell, any Relevant
      Security.  Except as disclosed in the Pricing Prospectuses and
      the Prospectuses, no holder of any Relevant Security has any rights to
      require registration or qualification under the Securities Act or the
      Canadian Securities Laws of any Relevant Security in connection with the
      Offering, and any such rights so disclosed have either been fully complied
      with by the Company or effectively waived by the holders
      thereof.

            

    

     

    
      	
              (o)

            	
              The Material Subsidiaries are the
      only Subsidiaries that are “significant subsidiaries” of the Company
      (within the meaning of the Securities Act) or are otherwise material to
      the Company.  The Company and each Material Subsidiary has been
      duly organized and validly exists as a corporation, partnership or limited
      liability company in good standing under the laws of its jurisdiction of
      organization.  The Company and each Material Subsidiary is duly
      qualified to do business and is in good standing as a foreign corporation,
      partnership or limited liability company in each jurisdiction in which the
      character or location of its properties (owned, leased or licensed) or the
      nature or conduct of its business makes such qualification necessary,
      except for those failures to be so qualified or in good standing which
      (individually and in
      the aggregate) could
      not reasonably be expected to have a material adverse effect on (i) the
      business, general affairs, management, condition (financial or otherwise),
      results of operations, shareholders’ equity, properties or prospects of
      the Company and the Subsidiaries, taken as a whole; or (ii) the ability of
      the Company to consummate the Offering or any other transaction
      contemplated by this Agreement, the Pricing Prospectuses or the
      Prospectuses (a “Material
      Adverse Effect”).

            

    

     

    
      	
              (p)

            	
              The Company and each Material
      Subsidiary has all requisite power and authority, and all necessary
      material consents, approvals, authorizations, orders, registrations,
      qualifications, licenses, filings and permits of, with and from all
      judicial, regulatory and other legal or governmental agencies and bodies
      and all third parties, Canadian, U.S. or foreign (collectively, the
      “Consents”), to own, lease and operate its
      properties and conduct its business as it is now being conducted, in each
      case as disclosed in the Registration Statement, the Pricing Prospectuses
      and the Prospectuses,
      and each such Consent is valid and in full force and effect, except in
      each case as could not reasonably be expected to have a
      Material Adverse Effect.  Neither the Company nor any
      Material Subsidiary has received notice of any investigation or
      proceedings which, if
      decided adversely to the Company or any such Material Subsidiary, could
      reasonably be expected to result in, the revocation of, or imposition of a materially
      burdensome restriction on, any such Consent.

            

    

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    
      	
              (q)

            	
              There are no reports
      or information that
      in accordance with the requirements of the Canadian Securities Laws must
      be made publicly available in connection with the Offering that have not
      been made publicly available as required; there are no documents required
      to be filed as of the date hereof with the Canadian
      Qualifying Authorities or with any other Canadian securities regulatory
      authority in connection with the Offering that have not been filed as
      required; the Company has not filed any confidential material change
      reports or similar confidential report with
      any securities regulatory authority that is still maintained on a
      confidential basis.

            

    

     

    
      	
              (r)

            	
              The completion of the Offering,
      the compliance by the Company with this Agreement and the consummation of
      the transactions herein contemplated do not and will not (i) conflict with
      or result in a breach or violation of any of the terms and provisions of,
      or constitute a default (or an event which with notice or lapse of time,
      or both, would constitute a default) under, or result in the creation or
      imposition of any Lien upon any property or assets of the Company or any
      Material Subsidiary pursuant to, any indenture, mortgage, deed of trust,
      loan agreement or other agreement, instrument, franchise, license or
      permit to which the Company or any Material Subsidiary is a party or by
      which the Company or any Material Subsidiary or their respective
      properties, operations or assets may be bound or (ii) violate or conflict
      with any provision of the certificate or articles of incorporation,
      by-laws, certificate of formation, limited liability company agreement,
      partnership agreement or other organizational documents of the Company or
      any Material Subsidiary, or (iii) violate or conflict with any statute,
      law, rule,
      regulation, ordinance, directive, judgment, decree or order of any
      judicial, regulatory or other legal or governmental agency or body,
      Canadian, U.S. or other, except (in the case of clauses (i) and (iii)
      above) as could not reasonably be expected to have a Material Adverse
      Effect.

            

    

     

    
      	
              (s)

            	
              No Consent of, with or from any
      judicial, regulatory or other legal or governmental agency or body, or any
      third party, Canadian, U.S. or foreign, is required for the execution,
      delivery and performance of this Agreement or consummation of the
      transactions contemplated by this Agreement, except the registration under
      the Securities Act of the Offered Shares, Warrants and Warrant Shares, the
      qualification of the Offered Shares, Warrants and
      Warrant Shares for
      distribution in the Canadian Jurisdictions as contemplated by this
      Agreement, necessary approvals of the TSX Venture Exchange Inc. (the
      “TSX.V”), Amex and any consents as may
      be required under state or foreign securities or blue sky laws in
      connection with the distribution of the Units, each of which has been
      obtained and is in full force and effect (on a conditional basis, in the
      case of the Consent of the TSX.V); except for the approval of the Amex,
      which will be obtained in accordance with the terms and conditions of this
      Agreement.

            

    

     

    
      	
              (t)

            	
              Except as disclosed in the
      Registration Statement, the Pricing Prospectuses and the Prospectuses,
      there is no judicial, regulatory, arbitral or other legal or governmental
      proceeding or other litigation or arbitration, Canadian, United
      States or foreign, pending to which the Company or
      any Subsidiary is a party or of which any property, operations or assets
      of the Company or any Subsidiary is the subject which, individually or in
      the aggregate, if determined adversely to the Company or any Subsidiary,
      could reasonably be expected to have a Material Adverse Effect; to the
      Company’s knowledge, no such proceeding, litigation or arbitration is
      threatened or contemplated; and the defence of all such proceedings,
      litigation and arbitration against or involving the Company or any
      Subsidiary could not reasonably be expected to have a Material Adverse
      Effect.

            

    

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    
      	
              (u)

            	
              The consolidated financial
      statements, including the notes thereto, included or incorporated by
      reference in the Registration Statement, the Pricing Prospectuses and the
      Prospectuses present fairly, in all material respects, the financial
      position as of the dates indicated and the cash flows and results of
      operations for the periods specified of the Company and its consolidated
      Subsidiaries; except as otherwise stated in the Registration Statement,
      the Pricing Prospectuses and the Prospectuses, said consolidated financial
      statements have been prepared in conformity with generally accepted
      accounting principles in the United States applied on a consistent basis
      throughout the periods involved.  No other financial statements
      or supporting schedules are required to be included in the Registration
      Statement, the Pricing Prospectuses and the Prospectuses by Canadian
      Securities Laws, the Securities Act, the Exchange Act or the Rules and
      Regulations.  The other financial and statistical information
      included or incorporated by reference in the Registration Statement, the
      Pricing Prospectuses and the Prospectuses present fairly the information
      included therein and have been prepared on a basis consistent with that of
      the financial statements that are included or incorporated by reference in
      the Registration Statement, the Pricing Prospectuses and the Prospectuses
      and the books and records of the
Company.

            

    

     

    
      	
              (v)

            	
              There has not been any reportable
      event (within the meaning of National Instrument 51-102 – Continuous
      Disclosure Obligations) between the Company and its
      auditors.

            

    

     

    
      	
              (w)

            	
              The common shares of the Company
      have been registered pursuant to Section 12(b) of the Exchange
      Act.  The common shares of the Company are listed on the TSX.V
      and on Amex, and the Company has taken no action designed to, or likely to
      have the effect of, terminating the registration of the common shares of
      the Company under the Exchange Act or de-listing the common shares of the
      Company from the TSX.V or Amex, nor has the Company received any
      notification that the Commission, the Canadian Qualifying Authorities, the
      TSX.V or Amex is contemplating terminating such registration or
      listing.

            

    

     

    
      	
              (x)

            	
              Except as disclosed in the Pricing
      Prospectus and the Prospectuses, the Company and its Material Subsidiaries
      maintain a system of internal accounting and other controls sufficient to
      provide reasonable assurances that (i) transactions are executed in
      accordance with management’s general or specific authorizations, (ii)
      transactions are recorded as necessary to permit preparation of financial
      statements in conformity with generally accepted accounting principles and
      to maintain accountability for assets, (iii) access to assets is permitted
      only in accordance with management’s general or specific authorization,
      and (iv) the recorded accounting for assets is compared with existing
      assets at reasonable intervals and appropriate action is taken with
      respect to any differences.  Except as disclosed in the Pricing
      Prospectus and the Prospectuses, the Company maintains a system of
      internal control over financial reporting (as such term is defined in Rule
      13a-15(f) under the Exchange Act) that complies with the requirements of
      the Exchange Act and has been designed by the Company’s principal
      executive officer and principal financial officer, or under their
      supervision, to provide reasonable assurance regarding the reliability of
      financial reporting and the preparation of financial statements for
      external purposes in accordance with United States generally accepted
      accounting principles.  Except as disclosed in the Pricing
      Prospectus and the Prospectuses, the Company believes that the Company’s
      and its Material Subsidiaries’ internal control over financial reporting
      is effective and the Company and its Material Subsidiaries are not aware
      of any material weakness in their internal control over financial
      reporting.

            

    

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    
      	
              (y)

            	
              Since the date of the latest
      audited consolidated financial statements included or incorporated by
      reference in the Pricing Prospectuses and the Prospectuses there has been
      no change in the Company’s internal control over financial reporting that
      has materially affected, or is reasonably likely to materially affect, the
      Company’s internal control over financial
  reporting.

            

    

     

    
      	
              (z)

            	
              The Company and its Subsidiaries
      maintain disclosure controls and procedures (as such term is defined in
      the Exchange Act and Canadian Securities Laws) that comply with the
      requirements of the Exchange Act and Canadian Securities Laws; such
      disclosure controls and procedures have been designed to ensure that
      material information relating to the Company and its Subsidiaries is made
      known to the Company’s principal executive officer and principal financial
      officer by others within those entities.  Such disclosure
      controls and procedures are
effective.

            

    

     

    
      	
              (aa)

            	
              There is and has been no failure
      on the part of the Company or any of its directors or officers, in their
      capacities as such, to comply with any provision of the Sarbanes-Oxley Act
      of 2002 and the rules and regulations promulgated in connection therewith,
      including, without limitation, Section 402 related to loans and Sections
      302 and 906 related to
certifications.

            

    

     

    
      	
              (bb)

            	
              Neither the Company nor, to the
      Company’s knowledge, any of its affiliates (within the meaning of Rule 144
      under the Securities Act) has taken, directly or indirectly, any action
      which constitutes or is designed to cause or result in, or which could
      reasonably be expected to constitute, cause or result in, the
      stabilization or manipulation of the price of any security to facilitate
      the sale or resale of the
Units.

            

    

     

    
      	
              (cc)

            	
              Neither the Company nor, to the
      Company’s knowledge, any of its affiliates (within the meaning of Rule 144
      under the Securities Act) has, prior to the date hereof, made any offer or
      sale of any securities which could be “integrated” (within the meaning of
      the Securities Act and the Rules and Regulations) with the offer and sale
      of the Units.

            

    

     

    
      	
              (dd)

            	
              The statements set forth (i) in
      the Base Prospectuses under the captions “Description of Share Capital”
      and “Risk Factors – Risks Related to Midway’s Securities  – We
      are a foreign corporation and have officers and directors resident outside
      the United States....”; (ii) in the Canadian Prospectus Supplement and the
      U.S. Prospectus Supplement under the captions “Canadian Federal Income Tax
      Considerations” and “Eligibility for Investment”; and (iv) in the
      Registration Statement under “Part II – Indemnification of Directors and
      Officers”, insofar as such statements summarize legal matters, agreements,
      documents or proceedings discussed therein, are, in all material respects,
      accurate, complete and fair summaries of such legal matters, agreements,
      documents or proceedings.

            

    

     

    
      	
              (ee)

            	
              There is no franchise, contract or
      other document of a character required to be described in the Registration
      Statement, the Pricing Prospectuses or the Prospectuses, or to be filed as
      an exhibit thereto, which is not described or filed as required; insofar
      as such descriptions summarize legal matters, agreements, documents or
      proceedings discussed therein, such descriptions are accurate and fair
      summaries of such legal matters, agreements, documents or
      proceedings.

            

    

     

    
      	
              (ff)

            	
              The Company is subject to the
      reporting requirements of Section 13 of the Exchange Act and files
      periodic reports with the Commission.  All conditions for use of Form S-3 to
      register the Units under the Securities Act have been
      satisfied.  The documents incorporated or deemed to be
      incorporated by reference in the Pricing Prospectuses and the
      Prospectuses, at the time they were or hereafter are filed with the
      Commission or the Canadian Qualifying Authorities, complied and will
      comply in all material respects with the requirements of the Securities
      Act, the Exchange Act, the Rules and Regulations and Canadian Securities
      Laws and, when read together with the other information in the Pricing
      Prospectuses and the Prospectuses, as applicable, do not contain an untrue
      statement of a material fact or omit to state a material fact required to
      be stated therein or necessary to make the statements therein, in the
      light of the circumstances under which they were made, not
      misleading.

            

    

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    
      	
              (gg)

            	
              Except as disclosed in the Pricing
      Prospectuses and the Prospectuses, the Company is not and, at all times up
      to and including consummation of the transactions contemplated by this
      Agreement, and after giving effect to application of the net proceeds of
      the Offering as described in the Pricing Prospectuses and the
      Prospectuses, will not be, required to register as an “investment company”
      under the Investment Company Act of 1940, as amended, and is not and will
      not be an entity “controlled” by an “investment company” within the
      meaning of such act.

            

    

     

    
      	
              (hh)

            	
              Except as disclosed in the Pricing
      Prospectuses and the Prospectuses, there are no contracts, agreements or
      understandings between the Company and any person that would give rise to
      a valid claim against the Company or the Agent for a brokerage commission,
      finder’s fee or other like payment in connection with the transactions
      contemplated by this Agreement or, to the Company’s knowledge, any
      arrangements, agreements, understandings, payments or issuance with
      respect to the Company or any of its officers, directors, shareholders,
      partners, employees, Subsidiaries or affiliates that may affect the
      Agent’s compensation.

            

    

     

    
      	
              (ii)

            	
              Neither the Company nor any of its
      Subsidiaries (i) has any material lending or other relationship with any
      bank or lending affiliate of the Agent and (ii) intends to use any of the
      proceeds from the Offering hereunder to repay any outstanding debt owed to
      any affiliate of the Agent.

            

    

     

    
      	
              (jj)

            	
              Except as disclosed in the Pricing
      Prospectuses and the Prospectuses, (i) the Company and each Material
      Subsidiary owns or leases all such properties as are necessary to the
      conduct of its business as presently operated and as proposed to be
      operated as described in the Pricing Prospectuses and the Prospectuses;
      (ii) to the knowledge of the Company, it and the Material Subsidiaries
      have good and marketable title to all real property and good and
      marketable title to all personal property owned by them, in each case free
      and clear of any and all Liens except such as are described in the Pricing
      Prospectuses and the Prospectuses or such as do not (individually or in the
      aggregate) materially
      affect the value of
      such property or materially interfere with the use made or proposed to be
      made of such property
      by the Company and the Material Subsidiaries; and any real property and
      buildings held under lease or sublease by the Company and the Material
      Subsidiaries are held by them under valid, subsisting and enforceable
      leases with such exceptions as are not material to, and do not materially
      interfere with, the use made and proposed to be made of such property and
      buildings by the Company and the Material Subsidiaries; and (iii) neither
      the Company nor any Material Subsidiary has received any notice of any
      claim adverse to its ownership of any real or personal property or of any
      claim against the continued possession of any real property, whether owned
      or held under lease or sublease by the Company or any Material Subsidiary,
      except as could not reasonably be expected to have a Material Adverse
      Effect.

            

    

     

    
      	
              (kk)

            	
              All interests in material mining
      claims, concessions, exploitation or extraction rights or similar rights
      (“Mining
      Claims”) that are
      held by the Company or any of its Material Subsidiaries are in good
      standing, are valid and enforceable, are free and clear of any material
      liens or charges, and no material royalty is payable in respect of any of
      them, except as disclosed in the Pricing Prospectuses and the
      Prospectuses.  Except as disclosed in the Pricing Prospectuses
      and the Prospectuses, no other material property rights are necessary for
      the conduct of the Company’s business as described therein, and there are
      no material restrictions on the ability of the Company and its Material
      Subsidiaries to use, transfer or otherwise exploit any such property
      rights except as required by applicable law.  Except as
      disclosed in the Pricing Prospectuses and the Prospectuses, the Mining
      Claims held by the Company or its Material Subsidiaries cover the
      properties required by the Company for the purposes described
      therein.

            

    

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    
      	
              (ll)

            	
              Except as disclosed in the Pricing
      Prospectuses and the Prospectuses, and except for estimates of mineralized
      material prepared in accordance with Guide 7 of the Commission and
      contained in the Company’s filings with the Commission, the information
      relating to estimates by the Company of the proven and probable reserves
      and the measured, indicated and inferred resources associated with its
      mineral property projects contained in the Pricing Prospectuses and the
      Prospectuses has been prepared in all material respects in accordance with
      National Instrument 43-101- Standards of Disclosure for Mineral
      Projects.  The Company believes that all of the assumptions
      underlying such reserve and resource estimates are reasonable and
      appropriate.

            

    

     

    
      	
              (mm)

            	
              The Company and the Material Subsidiaries maintain insurance
      in such amounts and covering such risks as the Company reasonably
      considers adequate for the conduct of its business and the value of its
      properties and as is customary for companies engaged in similar businesses
      in similar industries, all of which insurance is in
      full force and effect, except where the failure to maintain such insurance
      could not reasonably be expected to have a Material Adverse
      Effect.  There are no material claims by the Company or any
      Material Subsidiary under any such policy or instrument as to which any
      insurance company is denying liability or defending under a reservation of
      rights clause.  The Company reasonably believes that it will be
      able to renew its existing insurance as and when such coverage expires or
      will be able to obtain replacement insurance adequate for the conduct of
      the business and the value of its properties at a cost that would not have
      a Material Adverse Effect.

            

    

     

    
      	
              (nn)

            	
              The Company and each Subsidiary
      has accurately prepared and timely filed all U.S., Canadian and foreign
      tax returns that are required to be filed by it, or have requested
      extensions for the filing thereof, and has paid or made provision for the
      payment of all taxes, assessments, governmental or other similar charges,
      including without limitation, all sales and use taxes and all taxes which
      the Company or any Subsidiary is obligated to withhold from amounts owing
      to employees, creditors and third parties, with respect to the periods
      covered by such tax returns (whether or not such amounts are shown as due
      on any tax return), except in any such case as could not reasonably be
      expected to have a Material Adverse Effect.  No deficiency
      assessment with respect to a proposed adjustment of the Company’s or any
      Subsidiary’s Canadian federal and provincial, U.S. federal and state,
      local or foreign taxes is pending or, to the best of the Company’s
      knowledge, threatened.  The accruals and reserves on the books
      and records of the Company and the Subsidiaries in respect of
      tax liabilities for any taxable period not finally determined are adequate
      to meet any assessments and related liabilities for any such period and,
      since the date of the most recent audited consolidated financial
      statements, the Company and the Subsidiaries have not incurred any
      liability for taxes other than in the ordinary course of its business.
      There is no tax lien, whether imposed by any U.S., Canadian or other taxing
      authority, outstanding against the assets, properties or business of the
      Company or any Subsidiary.

            

    

     

    
      	
              (oo)

            	
              There are no transfer taxes or
      other similar fees or charges under Canadian or U.S. federal law or the laws of any
      state, province or any political subdivision thereof, required to be paid
      in connection with the execution and delivery of this Agreement or the
      issuance by the Company or sale by the Company of the
      Units.

            

    

     

    
      	
              (pp)

            	
              No stamp duty, registration or
      documentary taxes, duties or similar charges are payable under the federal
      laws of Canada or the laws of any province in connection with the
      creation, issuance, sale and delivery of the Units or the authorization,
      execution, delivery and performance of this
    Agreement.

            

    

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    
      	
              (qq)

            	
              Except as disclosed in the Pricing
      Prospectuses and the Prospectuses, no dispute between the Company and any
      local, native or indigenous group exists or is threatened or imminent with
      respect to any of the Company’s properties or exploration activities that
      could reasonably be expected to have a Material Adverse
      Effect.

            

    

     

    
      	
              (rr)

            	
              No labour disturbance by the
      employees of the Company or any Material Subsidiary exists or, to the best
      of the Company’s knowledge, is imminent and the Company is not aware of
      any existing or imminent labour disturbances by the employees of any of
      its or any Material Subsidiary’s principal suppliers, manufacturers,
      customers or contractors, which, in either case (individually or in the
      aggregate), could reasonably be expected to have a Material Adverse
      Effect.

            

    

     

    
      	
              (ss)

            	
              There has been no storage,
      generation, transportation, handling, use, treatment, disposal, discharge,
      emission, contamination, release or other activity involving any kind of
      hazardous, toxic or other wastes, pollutants, contaminants, petroleum
      products or other hazardous or toxic substances, chemicals or materials
      (“Hazardous
      Substances”) by, due
      to, on behalf of, or caused by the Company or any Subsidiary (or, to the
      Company’s knowledge, any other entity for whose acts or omissions the
      Company is or may be liable) upon any property now or previously owned,
      operated, used or leased by the Company or any Subsidiary, or upon any
      other property, which would be a violation of or give rise to any
      liability under any applicable law, rule, regulation, order, judgment,
      decree or permit, common law provision or other legally binding standard
      relating to pollution or protection of human health and the environment
      (“Environmental
      Law”), except for
      violations and liabilities which, individually or in the aggregate, could
      not reasonably be expected to have a Material Adverse
      Effect.  There has been no disposal, discharge, emission
      contamination or other release of any kind at, onto or from any such
      property or into the environment surrounding any such property of any
      Hazardous Substances with respect to which the Company or any Subsidiary
      has knowledge, except as could not, individually or in the aggregate,
      reasonably be expected to have a Material Adverse Effect.  There
      is no pending or, to the best of the Company’s knowledge, threatened
      administrative, regulatory or judicial action, claim or notice of
      noncompliance or violation, investigation or proceedings relating to any
      Environmental Law against the Company or any Subsidiary.  No
      property of the Company or any Subsidiary is subject to any Lien under any
      Environmental Law.  Except as disclosed in the Pricing
      Prospectuses and the Prospectuses, neither the Company nor any Subsidiary
      is subject to any order, decree, agreement or other individualized legal
      requirement related to any Environmental Law, which, in any case
      (individually or in the aggregate), could reasonably be expected to have a
      Material Adverse Effect.

            

    

     

    
      	
              (tt)

            	
              In the ordinary course of its
      business, the Company periodically reviews the effect of Environmental
      Laws on the business, operations and properties of the Company and its
      Subsidiaries, in the course of which it identifies and evaluates
      associated costs and liabilities (including, without limitation, any
      capital or operating expenditures required for clean-up, closure or
      remediation of properties or compliance with Environmental Laws, or any
      permit, license or approval, any related constraints on operating
      activities and any potential liabilities to third parties).  On
      the basis of such review, the Company has reasonably concluded that such
      associated costs and liabilities would not, individually or in the
      aggregate, have a Material Adverse
  Effect.

            

    

     

    
      	
              (uu)

            	
              None of the Company, any
      Subsidiary or, to the Company’s knowledge, any of its employees or agents,
      has at any time during the last five years (i) made any unlawful
      contribution to any candidate for non-United States office, or failed to
      disclose fully any such contribution in violation of law, or (ii) made any
      payment to any federal or state governmental officer or official, or other
      person charged with similar public or quasi-public duties, other than
      payments required or permitted by the laws of the United States of any
      jurisdiction thereof.  The operations of the Company and each
      Subsidiary are and have been conducted at all times in compliance with
      applicable financial record-keeping and reporting requirements of the
      Currency and Foreign Transactions Reporting Act of 1970, as amended, the
      money laundering statutes of all applicable jurisdictions, the rules and
      regulations thereunder and any related or similar rules, regulations or
      guidelines issued, administered or enforced by any governmental agency
      (collectively, the “Money
      Laundering Laws”) and
      no action, suit or proceeding by or before any court or governmental
      agency, authority or body or any arbitrator involving the Company or any
      Subsidiary with respect to the Money Laundering Laws is pending or, to the
      best knowledge of the Company, threatened.  Neither the Company
      nor any Subsidiary nor, to the knowledge of the Company, any director,
      officer, agent, employee or affiliate of the Company or any Subsidiary is
      currently subject to any U.S. sanctions administered by the Office of
      Foreign Assets Control of the U.S. Treasury Department (“OFAC”); and the Company will not
      directly or indirectly use the proceeds of the Offering, or lend,
      contribute or otherwise make available such proceeds to any Subsidiary,
      joint venture partner or other person or entity, for the purpose of
      financing the activities of any person currently subject to any U.S.
      sanctions administered by
OFAC.

            

    

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    
      	
              (vv)

            	
              Neither the Company nor any
      Material Subsidiary (i) is in violation of its certificate or articles of
      incorporation, by-laws, certificate of formation, limited liability
      company agreement, partnership agreement or other organizational
      documents, (ii) is in default under, and no event has occurred which, with
      notice or lapse of time or both, would constitute a default under or
      result in the creation or imposition of any Lien upon any property or
      assets of the Company or any Material Subsidiary pursuant to, any
      indenture, mortgage, deed of trust, loan agreement or other agreement or
      instrument to which it is a party or by which it is bound or to which any
      of its property or assets is subject, or (iii) is in violation of any
      statute, law, rule,
      regulation, ordinance, directive, judgment, decree or order of any
      judicial, regulatory or other legal or governmental agency or body,
      Canadian, U.S. or foreign, except in any such case for violations or
      defaults that could not (individually or in the aggregate) reasonably be
      expected to have a Material Adverse
  Effect.

            

    

     

    
      	
              (ww)

            	
              The Company has complied with the
      requirements of Rule 433 under the Securities Act with respect to each
      Issuer Free Writing Prospectus including, without limitation, all
      prospectus delivery, filing, record retention and legending requirements
      applicable to any such Issuer Free Writing Prospectus.  The
      Company has not (i) distributed any offering material in connection with
      the Offering other than the Pricing Prospectuses, the Prospectuses and any
      Issuer Free Writing Prospectus set forth on Schedule “C” hereto, or (ii)
      filed, referred to, approved, used or authorized the use of any “free
      writing prospectus” as defined in Rule 405 under the Securities Act with
      respect to the Offering, except for any Issuer Free Writing Prospectus set
      forth in Schedule “C” hereto and any electronic road show
      previously approved by the
Agent.

            

    

     

    
      	
              (xx)

            	
              The Company is a reporting issuer
      under the securities laws of the Canadian Qualifying Authorities and is
      not on the list of
      defaulting reporting issuers maintained by such Canadian Qualifying
      Authorities.

            

    

     

    
      	
              (yy)

            	
              Computershare Investor Services
      Inc. at its principal offices in the city of Vancouver, British Columbia is the duly appointed registrar
      and transfer agent of the Company with respect to its common shares and
      Computershare Trust Company of Canada is the duly appointed warrant
      agent with respect to the Warrants under the Warrant
      Indenture.

            

    

     

    
      	
              (zz)

            	
              The minute books and corporate
      records of the Company and its Material Subsidiaries are true and correct
      in all material respects and contain all minutes of all meetings and all
      resolutions of the directors (and any committees of such directors) and
      shareholders of the Company and its Material Subsidiaries as at the date
      hereof and at the Closing Date will contain the minutes of all meetings
      and all resolutions of the directors (and any committees of such
      directors) and shareholders of the Company and its Material
      Subsidiaries.

            

    

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    
      	
              (aaa)

            	
              All of the information provided to
      the Agent or to counsel for the Agent by the Company and, to the best of
      its knowledge, by its officers and directors and the holders of greater
      than 5% of the Company’s common shares in connection with letters, filings
      or other supplemental information provided to the Financial Industry
      Regulatory Authority (“FINRA”) pursuant to FINRA Corporate
      Financing Rule 5110, is, to the best of the Company’s knowledge true,
      complete and correct.

            

    

     

    
      	
              (bbb)

            	
              Each stock option granted under
      any stock option plan of the Company or any Subsidiary (each, a
      “Stock
      Plan”) was granted
      with a per share exercise price no less than the fair market value per
      common share on the grant date of such option, and no such grant involved
      any “back-dating,” “forward-dating” or similar practice with respect to
      the effective date of such grant; each such option (i) was granted in
      compliance with applicable law and with the applicable Stock Plan, (ii)
      was duly approved by the board of directors (or a duly authorized
      committee thereof) of the Company or such Subsidiary, as applicable, and
      (iii) has been properly accounted for in the Company’s financial
      statements and disclosed, to the extent required, in the Company’s filings
      or submissions with the Commission and the Canadian Qualifying
      Authorities.

            

    

     

    Any
certificate signed by or on behalf of the Company and delivered to the Agent or
to its counsel shall be deemed to be a representation and warranty by the
Company to the Agent as to the matters covered thereby.

     

    
      	
              2.

            	
              Representations
      and Warranties of the Agent.

            

    

     

    The Agent
represents and warrants to, and agrees with, the Company that:

     

    
      	
              (a)

            	
              the Agent is, and will remain so,
      until completion of the Offering, appropriately registered under
      applicable Canadian Securities Laws and policies of the TSX.V and it or
      its U.S. broker-dealer affiliate is registered under the United States
      Securities Exchange Act of 1934, as amended (the “Exchange
      Act”) and is a member
      in good standing with FINRA so as to permit it to lawfully fulfil its
      obligations hereunder;

            

    

     

    
      	
              (b)

            	
              the
  Agent:

            

    

     

    
      	
               
      

            	
              (i)

            	
              has only communicated (or caused to be
      communicated) and will only communicate (or cause to be communicated) in
      or into the United Kingdom an invitation or inducement to engage in
      investment activity (within the meaning of section 21 of the Financial
      Services and Markets Act 2000 (as amended) (“FSMA”) in connection with the
      issue and sale of the Units circumstances in which it may do so without
      breach of section 21(1) of the
FSMA;

            

    

     

    
      	
               
      

            	
              (ii)

            	
              has only offered and will only offer the Units (or
      cause them to be offered) to the public in the United Kingdom (within the
      meaning of section 102B of the FSMA) in circumstances in which, pursuant
      to section 86 of the FSMA, it may do so without an approved prospectus
      within the meaning of section 85 of the FSMA having first been made
      available and, in particular, the Agent has not offered (or caused to be
      offered) and will not offer (or cause to be offered) the Units to more
      than 99 persons other than “qualified investors” (as defined in section
      86(7) of the FSMA); and

            

    

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    
      	
              (c)

            	
              the Agent has full corporate
      capacity, power and authority to execute this Agreement and to perform its
      obligations set out herein and this Agreement is a legal, valid and
      binding obligation of the Agent enforceable against the Agent in
      accordance with their terms subject to laws relating to creditors’ rights
      generally.

            

    

     

    For the purposes of calculating the number of persons to
whom an offer is made for the purposes of Section 2(b)(iii), an offer made to a
person who not acting as principal is considered to be made to all principals
such person.

     

    The
representations and warranties of the Agent contained in this Agreement shall be
true as of the Closing Date as though they were made at the time of the closing
of the Offering and they shall survive the completion of the transactions
contemplated under this Agreement.

     

    
      	
              3.

            	
              Purchase,
      Sale and
      Delivery of the Securities.

            

    

     

    
      	
              (a)

            	
              The Company hereby appoints the
      Agent as its sole and exclusive agent for the purpose of selling, in
      accordance with the terms and conditions hereof, the Units.  The
      Agent hereby accepts such agency and agrees to use its best efforts to
      sell the Units on said terms and conditions. The appointment of the Agent
      hereunder shall terminate upon the Closing Date unless earlier terminated
      pursuant to Section 12 hereof.  The Agent represents, warrants
      and agrees that it shall comply with all Canadian Securities Laws, the
      Securities Act, the Rules and Regulations, the Exchange Act and the rules
      and regulations of the Commission thereunder, including Rule 15c2-4 under
      the Exchange Act, the policies of the TSX.V and all applicable laws of any
      other jurisdiction in which it offers or from which it solicits offers to
      purchase Units in connection with the Offering.  The Agent will
      require all selected dealers making offers in the United States to comply with Rule 15c2-4 under
      the Exchange Act.

            

    

     

    
      	
              (b)

            	
              The Agent (i) shall comply with
      FINRA Rules 5110 and 2720 and use its commercially reasonable efforts to
      obtain the FINRA no objections letter within 30 days hereof, (ii) shall
      use its commercially reasonable efforts to ensure that the compensation
      paid to any member of FINRA or person affiliated with a member of FINRA
      shall comply with FINRA Corporate Financing Rule 5110, (iii) shall use its
      commercially reasonable efforts to ensure that all participating FINRA
      members are aware of their obligations pursuant to FINRA Rules 2730, 2740,
      2420 and 2750, (iv) hereby agrees that, pursuant to FINRA Rule 5110(g)(1),
      the compensation warrants issued to it pursuant to the offering of the
      Company in Canada which closed on June 16, 2010 and any securities issued
      upon exercise or conversion thereof shall not be sold during the Offering,
      or sold, transferred, assigned, pledged, or hypothecated, or be the
      subject of any hedging, short sale, derivative, put, or call transaction
      that would result in the effective economic disposition of the
      compensation warrants or the securities issued upon exercise or conversion
      thereof by any person for a period of 180 days immediately following the
      date of effectiveness or commencement of sales of the Offering, and (v)
      acknowledges that the compensation warrants issued to it pursuant to the
      offering of the Company in Canada which closed on June 16, 2010 are
      exercisable no more than five years from the effective date of the U.S.
      Base Prospectus.

            

    

     

    
      	
              (c)

            	
              On the basis of the
      representation, warranties, covenants and agreements contained herein, but
      subject to the terms and conditions herein set forth, the Company agrees
      to issue and to sell the Units to the persons identified by the Agent at
      the Offer Price.  It is understood that in no event shall the
      Agent be obligated to purchase any Units. The Offering is strictly a “best
      efforts” offering.  All Units to be offered and sold in the
      Offering shall be issued and sold through the Agent, as agent for the
      Company, and the Company will not sell or agree to sell any of the Units
      otherwise than through the Agent. In the event the Company or any of its
      executive officers is contacted directly or indirectly by prospective
      purchasers of the Units, the Company will promptly forward the names of
      such prospective purchasers to the
Agent.

            

    

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    
      	
              (d)

            	
              Payment of the purchase price for
      and delivery of certificates for the Offered Shares and Warrants
      comprising the Units shall be made at the offices of Stikeman Elliott LLP,
      or at such other place as shall be agreed upon by the Agent and the
      Company, at 6:00 a.m. (Vancouver time) on November 22, 2010, or such other
      time and date as the Agent and the Company may agree upon in writing (such
      time and date of payment and delivery being herein called the
      “Closing
      Date”).  Payment in respect
      of the purchase price for the Units sold by the Agent shall be denominated
      in United States dollars, and shall be made to the Company by wire
      transfers of immediately available funds to a bank account designated by
      the Company, against delivery to the Agent of certificates for the Offered
      Shares and Warrants.

            

    

     

    
      	
              (e)

            	
              Certificates for the Offered
      Shares and Warrants shall be in such denominations and registered in such
      names as the Agent may request in writing at least two business days
      before the Closing Date.  The Company will permit the Agent to
      examine such certificates for delivery at least one full business day
      prior to the Closing Date.  At the option of the Agent, delivery
      of certificates for the Offered Shares may be made to Agent through the
      facilities of CDS
      Clearing and Depositary Services Inc. for the respective accounts of the
      Agent.

            

    

     

    
      	
              (f)

            	
              At the Closing Date the Company
      shall contemporaneously pay to the Agent the fee referred to in Section 4
      of this Agreement.

            

    

     

    
      	
              (g)

            	
              The Company acknowledges and
      agrees that (i) the terms of this Agreement and the Offering (including
      the price of the Units and commission with respect to the Offering) were
      negotiated at arm’s length between sophisticated parties represented by
      counsel; (ii) the Agent’s obligations to the Company in respect of the
      Offering are set forth in this Agreement in their entirety and (iii) it
      has obtained such legal, tax, accounting and other advice as it deems
      appropriate with respect to this Agreement and the transactions
      contemplated hereby and any other activities undertaken in connection
      therewith, and it is not relying on the Agent with respect to any such
      matters.

            

    

     

    
      	
              4.

            	
              Compensation
      of the Agent.

            

    

     

    In consideration for its services
hereunder, the Company agrees to pay to the Agent at the Closing Date a fee
equal to the amount of US$0.036 (6%) per Unit sold in the
Offering.

     

    
      	
              5.

            	
              Payment
      of Expenses.

            

    

     

    
      	
              (a)

            	
              Except as set forth in paragraph
      (b) below, whether or not the transactions contemplated by this Agreement,
      the Registration Statement and the Prospectuses are consummated or this
      Agreement is terminated, the Company hereby agrees to pay all costs and
      expenses incident to the performance of its obligations hereunder,
      including (except as expressly stated below in respect of the fees and
      disbursements of the Agent’s legal counsel) the following: (i) all
      expenses in connection with the preparation, printing and filing of the
      Registration Statement, the Base Prospectuses, the Pricing Prospectuses,
      the Prospectuses, any Issuer Free Writing Prospectus and any and all
      amendments and supplements thereto and the mailing and delivering of
      copies thereof to the Agent; (ii) the fees, disbursements and expenses of
      the Company’s counsel and accountants in connection with the qualification
      of the Units under Canadian Securities Laws, the registration of the Units
      under the Securities Act and the Offering; (iii) the cost of producing
      this Agreement, blue sky survey, closing documents and other instruments,
      agreements or documents (including any compilations thereof) in connection
      with the Offering; (iv) all expenses in connection with the qualification
      of the Securities for offering and sale under United States state
      securities, or “blue sky”, laws as provided in Section 6(f) hereof,
      including the reasonable fees and disbursements of counsel for the Agent
      in connection with such qualification and in connection with any blue sky
      survey; (v) the reasonable fees and disbursements of counsel for the Agent
      and the Company, as applicable (vi) all fees and expenses in connection
      with listing the Offered Shares and Warrant Shares on the TSX.V and Amex;
      (vii) all travel expenses of the Company’s officers and employees and any
      other expense of the Company incurred in connection with attending or
      hosting meetings with prospective purchasers of the Units; and (viii) any
      transfer taxes incurred in connection with this Agreement or the
      Offering.  The Company also will pay or cause to be paid: (a)
      the cost of preparing certificates representing the Offered Shares,
      Warrants and Warrant Shares; (b) the cost and charges of any transfer
      agent or registrar for the Offered Shares; (c) the cost and charges of any
      warrant agent with respect to the Warrants; (d) the reasonable costs and
      expenses of the Agent, up to a maximum of $35,000, including the
      reasonable fees and disbursements of their counsel, up to an aggregate of
      $30,000, the reasonable fees and disbursements of any experts or
      consultants retained by them and other out of pocket expenses incurred by
      them in connection with the transactions contemplated by this Agreement,
      provided that such fees and expenses were incurred prior to termination of
      this Agreement; and (e) all other reasonable costs and expenses incident
      to the performance of its obligations hereunder which are not otherwise
      specifically provided for in this Section
  5.

            

    

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

    
      	
              (b)

            	
              The Agent hereby agrees that, if
      the Offering is not completed according to the terms of this Agreement,
      the payment of any compensation or expense reimbursement by the Company to
      any FINRA member or person associated with a FINRA member in connection
      with the Offering is strictly prohibited, except for compensation or
      expense reimbursement negotiated and paid in connection with a transaction
      that occurs in lieu of the Offering as a result of the efforts of any
      FINRA member or related persons; provided however, that any FINRA member
      or persons associated with a FINRA member shall be entitled to
      reimbursement of out-of-pocket accountable expenses actually incurred by
      such FINRA member or persons associated with such FINRA member in
      accordance with paragraph (a)
above.

            

    

     

    
      	
              6.

            	
              Covenants
      of the Company.  

            

    

     

    In addition to the other covenants and
agreements of the Company contained herein, the Company further covenants and
agrees with the Agent that:

     

    
      	
              (a)

            	
              The Company will comply with the Shelf Procedures
      and the general instructions of Form S-3 and Rule 424 under the Securities
      Act.  Prior to the termination of the Offering, the Company will
      not file any amendment to the Registration Statement or supplement or
      amendment to the Prospectuses unless the
      Company has furnished a copy to the Agent and its legal counsel for their
      review prior to filing and will not file any such proposed amendment or
      supplement to which the Agent reasonably objects.  The Company
      will cause the Prospectuses, properly completed, and
      any supplement thereto to be filed, each in a form approved by the Agent
      with the Canadian Qualifying Authorities in accordance with the Shelf
      Procedures (in the case of the Canadian Prospectus) and with the
      Commission pursuant to Rule 424 under the
      Securities Act (in the case of the U.S. Prospectus) within the time period
      prescribed and will provide evidence satisfactory to the Agent of such
      timely filings. The Company will promptly advise the Agent (1) when the
      U.S. Prospectus and any supplement thereto
      shall have been filed with the Commission pursuant to Rule 424 under the
      Securities Act, (2) when the Canadian Prospectus shall have been filed
      with the Canadian Qualifying Authorities pursuant to the Shelf Procedures,
      (3) when, prior to termination of the
      Offering, any amendment to the Registration Statement or the Canadian
      Prospectus shall have been filed or become effective or a Decision
      Document in respect of any such amendment has been issued, as the case may
      be, (4) of any
      request by the Canadian Qualifying Authorities or the Commission for any
      amendment of or supplement to the Canadian Prospectus, the Registration
      Statement or the U.S. Prospectus, as applicable, or for any additional
      information, (5) of the Company’s intention to file, or prepare any
      supplement or amendment to, the Registration Statement, the Prospectuses
      or any Issuer Free Writing Prospectus, (6) of the time when any amendment
      to the Canadian Prospectus has been filed with or receipted by the
      Reviewing Authority, or of the filing with or mailing or the delivery to
      the Commission for filing of any amendment of or supplement to the
      Registration Statement or the U.S. Prospectus, (7) of the issuance by the
      Canadian Qualifying Authorities or the Commission of any cease trade order
      or any stop order suspending the effectiveness of the Canadian Prospectus
      or the Registration Statement, as applicable, or any post-effective
      amendment thereto, or suspending the use of any Prospectuses or any Issuer
      Free Writing Prospectus or, in each case, of the initiation or threatening
      of any proceedings therefor, (8) of the receipt of any comments or
      communications from the Canadian Qualifying Authorities, the Commission or
      any other regulatory authority relating to the Prospectuses, the
      Registration Statement, or the listing of the Offered Shares and Warrant
      Shares on the TSX.V or Amex, and (9) of the receipt by the Company of any
      notification with respect to the suspension of the qualification of the
      Units for sale in any jurisdiction or the initiation or threatening of any
      proceeding for that purpose.  If the Canadian Qualifying
      Authorities or the Commission shall propose or enter a cease trade order
      or a stop order at any time, the Company will use its reasonable best
      efforts to prevent the issuance of any such cease trade order or stop
      order and, if issued, to obtain the lifting of such order as soon as
      possible.

            

    

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

    
      	
              (b)

            	
              The Company will prepare and file
      with the Canadian Qualifying Authorities, promptly after the date of this
      Agreement, and in any
      event no later than 2:00 p.m. (Vancouver time) on the date of this
      Agreement, and in conformity in all material respects with applicable
      Canadian Securities Laws, the Canadian
  Prospectus.

            

    

     

    
      	
              (c)

            	
              The Company will prepare and file
      with the Commission,
      promptly after the date of this Agreement, and in any event no later than
      2:00 p.m. (Vancouver time) on the date of this Agreement, the U.S.
      Prospectus.

            

    

     

    
      	
              (d)

            	
              If at any time when a prospectus
      relating to the Units (or, in lieu thereof, the notice referred to in Rule
      173(a) under the Securities Act) is required to be delivered under the
      Securities Act, any event shall have occurred as a result of which the
      Pricing Disclosure Package (prior to the availability of the U.S.
      Prospectus) or the U.S. Prospectus as then amended or supplemented would,
      in the judgment of the Agent or the Company, include an untrue statement
      of a material fact or omit to state any material fact required to be
      stated therein or necessary to make the statements therein, in light of
      the circumstances existing at the time of delivery of such Pricing
      Disclosure Package or U.S. Prospectus (or, in lieu thereof, the notice
      referred to in Rule 173(a) under the Securities Act) to the purchaser, not
      misleading, or if to comply with the Securities Act, the Exchange Act or
      the Rules and Regulations it shall be necessary at any time to amend or
      supplement the Pricing Disclosure Package, the U.S. Prospectus or the
      Registration Statement, or to file any document incorporated by reference
      in the Registration Statement or the U.S. Prospectus or in any amendment
      thereof or supplement thereto, the Company will notify the Agent promptly
      and prepare and file with the Canadian Qualifying Authorities and/or the
      Commission an appropriate amendment, supplement or document (in form and
      substance satisfactory to the Agent) that will correct such statement or
      omission or effect such compliance, and will use its best efforts to have
      any amendment to the Registration Statement declared effective as soon as
      possible.

            

    

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

     

    
      	
              (e)

            	
              The Company will not, without the
      prior consent of the Agent, (i) make any offer relating to the Units that
      would constitute a “free writing prospectus” as defined in Rule 405 under
      the Securities Act and any electronic road show
      previously approved by the Agent, or (ii) file, refer to, approve, use or
      authorize the use of any “free writing prospectus” as defined in Rule 405
      under the Securities Act with respect to the Offering.  If at
      any time any event shall have occurred as a result of which any Issuer
      Free Writing Prospectus as then amended or supplemented would, in the
      judgment of the Agent or the Company, conflict with the information in the
      Registration Statement, the Pricing Prospectuses or the Prospectuses as
      then amended or supplemented or would, in the judgment of the Agent or the
      Company, include an untrue statement of a material fact or omit to state
      any material fact required to be stated therein or necessary to make the
      statements therein, in light of the circumstances existing at the time of
      delivery to the purchaser, not misleading, or if to comply with the
      Securities Act or the Rules and Regulations it shall be necessary at any
      time to amend or supplement any Issuer Free Writing Prospectus, the
      Company will notify the Agent promptly and, if requested by the Agent,
      prepare and furnish without charge to the Agent an appropriate amendment
      or supplement (in form and substance satisfactory to the Agent) that will
      correct such statement, omission or conflict or effect such
      compliance.

            

    

     

    
      	
              (f)

            	
              The Company has complied and will
      comply in all material respects with the requirements of Rule 433 with
      respect to each Issuer Free Writing Prospectus including, without
      limitation, all prospectus delivery, filing, record retention and
      legending requirements applicable to each such Issuer Free Writing
      Prospectus.

            

    

     

    
      	
              (g)

            	
              The Company will promptly deliver
      to the Agent conformed copies of the Canadian Base Prospectus, the
      Canadian Pricing Prospectus and the Canadian Prospectus, signed and
      certified as required by Canadian Securities Laws in the Canadian
      Jurisdictions, a copy of any other document required to be filed by the
      Company in compliance with Canadian Securities Laws in connection with the
      Offering, a conformed copy of the Registration Statement, as initially filed and all amendments thereto,
      including all
      consents and exhibits filed therewith.  The Company will promptly deliver
      to the Agent such number of copies of the Pricing Prospectuses,
      Prospectuses and the Registration Statement, all amendments of and
      supplements to such documents, if any, as the Agent may reasonably
      request.  Prior to 9:00 a.m. (Vancouver time) on the business
      day next succeeding the date of this Agreement and from time to time
      thereafter, the Company will furnish the Agent with copies of the Final
      Prospectuses in Vancouver in such quantities as the Agent may reasonably
      request.

            

    

     

    
      	
              (h)

            	
              The Company will make generally
      available to its security holders as soon as practicable an earnings
      statement of the Company (which need not be audited) which will satisfy
      the provisions of Section 11(a) of the Securities Act and Rule 158
      thereunder.

            

    

     

    
      	
              (i)

            	
              During a period of 60 days from
      the Closing Date, the Company will not, without the prior written consent
      of the Agent (i) directly or indirectly, offer, pledge, sell, contract to
      sell, sell any option or contract to purchase, purchase any option or
      contract to sell, grant any option, right or warrant to purchase or
      otherwise transfer or dispose of any common shares or any securities
      convertible into or exercisable or exchangeable for common shares or file
      any registration statement under the Securities Act with respect to any of
      the foregoing, (ii) enter into any swap or any other agreement or in
      respect of the foregoing, any transaction that transfers, in whole or in
      part, directly or indirectly, the economic consequence of ownership of the
      common shares, whether any such swap or transaction described in clause
      (i) or (ii) above is to be settled by delivery of common shares or such
      other securities, in cash or otherwise, or (iii) publicly announce an
      intention to do any of the foregoing. The foregoing sentence shall not
      apply to (A) any common shares issuable upon exercise of the warrants
      or other derivative securities of the Company outstanding on the date
      hereof, (B) the Offered Shares and Warrants to be issued pursuant to or in
      connection with the Offering, the Warrant Shares issuable pursuant to the
      exercise of the Warrants, (C) any common shares issued or options to
      purchase common shares granted pursuant to existing stock option plans of
      the Company referred to in the U.S. Prospectus and the Canadian
      Prospectus; and (D) any common shares representing up to 10% of the
      outstanding common stock of the Company as of the date hereof in
      connection with the acquisition of any business, property or asset that is
      consistent with the Company’s business as presently conducted and as
      described in the
Prospectuses.

            

    

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

    
      	
              (j)

            	
              The Company will use its
      commercially reasonable efforts to effect and maintain the listing of its
      common shares (or, if the corporation enters into an amalgamation,
      arrangement or merger of the corporation with or into any other
      corporation or other entity which effects a change of the common shares of
      the Company into other shares or an exchange of the common shares of the
      Company for other securities (including securities of another entity),
      such securities) on the TSX.V and Amex for a period of at least two years
      from the date of this
Agreement.

            

    

     

    
      	
              (k)

            	
              The Company will apply the net
      proceeds from the sale of the Units as set forth under the caption “Use of
      Proceeds” in the
Prospectuses.

            

    

     

    
      	
              (l)

            	
              The Company will not take, and
      will cause its affiliates not to take, directly or indirectly, any action
      which constitutes or is designed to cause or result in, or which could
      reasonably be expected to constitute, cause or result in, the
      stabilization or manipulation of the price of any security to facilitate
      the sale or resale of the Offered Shares or the Warrant
      Shares.

            

    

     

    
      	
              (m)

            	
              The Company shall use its
      commercially reasonable efforts during the term of the Warrants to
      maintain the effectiveness of one or more registration statements under
      the Securities Act covering the issuance and sale of the Warrant Shares,
      and shall take such other action as may be commercially reasonable to
      ensure that Warrant Shares shall not be subject to restrictions on resale
      under the Securities Act by persons that are not affiliates of the Company
      (provided, however, that nothing shall prevent the amalgamation, merger or
      sale of the Company, including any take-over bid, and any associated
      delisting or deregistration or ceasing to be a reporting issuer, provided
      that, so long as the Warrants are outstanding and represent a right to
      acquire securities of the acquiring company, the acquiring company shall
      assume the Company’s obligations under the Warrant
      Indenture).

            

    

     

    
      	
              (n)

            	
              The Company shall provide the
      Agent with a draft of any press release to be issued in connection with
      the Offering, and will provide the Agent and its counsel sufficient time
      to comment thereon and will accept all reasonable comments of the Agent and its counsel on
      such press releases.

            

    

     

    
      	
              7.

            	
              Conditions
      of Agent’s Obligations.

            

    

     

    The obligations of the Agent to the
performance of their obligations herein are subject to the accuracy of the
representations and warranties of the Company herein contained, as of the date
hereof and as of the Closing Date, and to the performance by the Company of all
of its obligations hereunder on the Closing Date including the Agent receiving
on the Closing Date:

     

    
      	
              (a)

            	
              The Canadian Prospectus shall have
      been filed with the Canadian Qualifying Authorities and the U.S.
      Prospectus shall have been filed with the Commission in a timely fashion
      in accordance with Section 6 hereof; no order of any securities
      commission, securities regulatory authority or stock exchange in Canada to
      cease distribution of the Units under the Canadian Prospectus, as amended
      or supplemented, shall have been issued, and no proceedings for such
      purpose shall have been instituted or, to the knowledge of the Company,
      threatened; no stop order suspending the effectiveness of the Registration
      Statement or any post-effective amendment thereto, and no stop order
      suspending or preventing the use of the U.S. Pricing Prospectus, the U.S.
      Prospectus or any Issuer Free Writing Prospectus, shall have been issued
      by the Commission and no proceedings therefor shall have been initiated or
      threatened by the Commission; all requests for additional information on
      the part of the Canadian Qualifying Authorities or the Commission shall
      have been complied with to the Agent’s reasonable satisfaction; and all
      necessary regulatory or stock exchange approvals in respect of the
      Offering shall have been
received.

            

    

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    
      	
              (b)

            	
              Not more than 30 days after the
      date hereof and prior to the Closing Date, FINRA shall have confirmed that
      it has no objection with respect to the
  Offering.

            

    

     

    
      	
              (c)

            	
              A favourable legal opinion of
      Stikeman Elliott LLP, Canadian counsel for the Company addressed to the
      Agent, in form and substance satisfactory to the Agent, to the effect set
      forth in Schedule “A” hereto and to such other matters as may reasonably
      be requested by the Agent.

            

    

     

    
      	
              (d)

            	
              A favourable legal opinion of
      Dorsey & Whitney LLP, United States counsel for the Company, addressed
      to the Agent, in form and substance satisfactory to the Agent, to the
      effect set forth in Schedule “B” hereto and to such other matters as may
      reasonably be requested by the
Agent.

            

    

     

    
      	
              (e)

            	
              A favourable legal opinion of
      Nesbitt & Associates LLC, United States counsel to Company addressed
      to the Agent, in form and substance satisfactory to the Agent, as to
      ownership by the Company of the Spring Valley Property and Pan
      Property.

            

    

     

    
      	
              (f)

            	
              A favourable legal opinion of Parr
      Brown Gee & Loveless addressed to the Agent, in form and substance
      satisfactory to the Agent, as to ownership of the Material Subsidiaries
      (other than Pan-Nevada Gold Corporation and GEH (B.C.) Holding Inc.) and
      their due incorporation or organization, valid existence and good standing
      (if such concept is recognized in such jurisdiction) and such other
      matters as may reasonably be requested by the
  Agent.

            

    

     

    
      	
              (g)

            	
              A certificate of the Chief
      Executive Officer and Chief Financial Officer of the Company in form and
      substance satisfactory to the Agent, as to the accuracy of the
      representations and warranties of the Company set forth in Section 1
      hereof as of the date hereof and as of the Closing Date as to the
      performance by the Company of all of its obligations hereunder to be
      performed at or prior to the Closing Date and as to the matters set forth
      in subsection (a) of this Section
7.

            

    

     

    
      	
              (h)

            	
              At the time this Agreement is
      executed and at the Closing Date, the Agent shall have received comfort
      letters, from KPMG LLP, independent chartered accountants for the Company,
      dated as of the date of this Agreement and as of the Closing Date,
      respectively, and addressed to the Agent, and in form and substance
      satisfactory to the Agent and its
  counsel.

            

    

     

    
      	
              (i)

            	
              At the Closing Date, a fully
      executed copy of the warrant indenture (the “Warrant
      Indenture”) between
      the Company and Computershare Trust Company of Canada providing for the
      creation and issuance of the Warrants, in form and substance satisfactory
      to the Agent and its
counsel.

            

    

     

    
      	
              (j)

            	
              At the Closing Date the Offered
      Shares and the Warrant Shares shall have been conditionally approved for
      listing on the TSX.V and shall be approved for listing, subject to
      official notice of issuance, on
Amex.

            

    

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

     

    
      	
              (k)

            	
              The Company shall have furnished
      to the Agent and its counsel with such other certificates, opinions or
      other documents as they may have reasonably
    requested.

            

    

     

    If any of
the conditions specified in this Section 7 shall not have been fulfilled when
and as required by this Agreement, or if any of the certificates, opinions,
written statements or letters furnished to the Agent or to its counsel pursuant
to this Section 7 shall not be satisfactory in form and substance to the Agent
and its counsel, all obligations of the Agent hereunder may be cancelled by the
Agent at, or at any time prior to, the Closing Date. Notice of such cancellation
shall be given to the Company in writing.

     

    
      	
              8.

            	
              Indemnification.

            

    

     

    
      	
              (a)

            	
              The Company covenants and agrees
      to indemnify and save harmless the Agent and its respective directors,
      officers, shareholders and employees and agents (collectively, the
      “Agent’s
      Personnel”) from any
      and all losses (other than loss of profits), claims, damages, liabilities,
      costs or expenses, whether joint or several, caused or incurred by reason
      of or in connection with the transactions contemplated hereby including,
      without limitation, the following: (i) any untrue statement or alleged
      untrue statement of a material fact contained in the Registration
      Statement, including all documents incorporated by reference therein (or
      contained in the Registration Statement as amended or supplemented by any
      post-effective amendment or supplement thereof or thereto by the Company),
      or any omission or alleged omission to state a material fact required to
      be stated therein or necessary to make the statements therein not
      misleading.; (ii) any “misrepresentation” within the meaning of Canadian
      Securities Laws or any untrue statement of material fact or alleged untrue
      statement of material fact included in the Canadian Preliminary
      Prospectus, the U.S. Preliminary Prospectus, the Canadian Prospectus, the
      U.S. Prospectus, in any Issuer Free Writing Prospectus or in any
      prospectus together with any combination of one or more Issuer Free
      Writing Prospectuses, or in any materials or information provided to
      investors by, or with the approval of, the Company in connection with the
      marketing of the Offering, including any roadshow or investor
      presentations made to investors by the Company (whether in person or
      electronically), or any omission or alleged omission to state a material
      fact required to be stated therein or necessary to make the statements
      therein not misleading in light of the circumstances in which they were
      made; (iii) the omission or alleged omission to state in any certificate
      of the Company, or of any officers of the Company delivered hereunder or
      pursuant hereto, of any material fact required to be stated therein where
      such omission or alleged omission constitutes or is alleged to constitute
      a misrepresentation;  (iv) any order made or any inquiry,
      investigation or proceeding commenced or threatened by any securities
      regulatory authority, stock exchange or by any other competent authority,
      based upon any misrepresentation or alleged misrepresentation in the
      Pricing Prospectuses or the Prospectuses based upon any failure or alleged
      failure to comply with Canadian Securities Laws or the applicable
      securities laws of the United States (other than any failure or alleged
      failure to comply by the Agent) preventing and restricting the trading in
      or the sale of the common shares or any of them in the jurisdictions of
      Canada, the United States, or any state of the United States; (v) the
      non-compliance or alleged non-compliance by the Company with any material
      requirement of applicable securities laws, including the Company’s
      non-compliance with any statutory requirement to make any document
      available for inspection; or (vi) the material breach of any
      representation, warranty or covenant of the Company contained herein or
      the failure of the Company to comply in all material respects with any of
      its obligations hereunder, except, with respect to any of the Pricing
      Prospectuses or the Prospectuses, insofar as any such loss, claim, damage,
      liability, cost or expense arises out of or is based upon any untrue
      statement or alleged untrue statement of a material fact contained in, and
      in conformity with, information concerning the Agent furnished by the
      Agent to the Company expressly for use in, such document, or arises out of
      or is based upon any omission or alleged omission to state a material fact
      in any of the Pricing Prospectuses or Prospectuses in connection with such
      information, which material fact was not contained in such information and
      which material fact was required to be stated in such information, or was
      necessary to make such information not misleading. The parties hereto
      agree that such information provided by the Agent consists solely of the
      materials referred to in Section 16
  hereof.

            

    

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

     

    
      	
              (b)

            	
              The Company shall reimburse the
      Agent promptly upon demand for any legal or other expenses reasonably
      incurred by them in connection with investigating or defending any such
      losses, claims, damages, liabilities or actions in respect thereof, as
      incurred.

            

    

     

    
      	
              (c)

            	
              The Company shall not, without the
      prior written consent of the Agent, which shall not be unreasonably
      withheld, settle or compromise or consent to the entry of any judgment in
      any pending or threatened claim, action, suit or proceeding in respect of
      which indemnification may be sought hereunder (whether or not the Agent is
      a party to such claim, action, suit or proceeding), unless such
      settlement, compromise or consent includes an unconditional release of the
      Agent and of the Agent’s Personnel from all liability arising out of such
      claim, action, suit or proceeding and does not include a statement as to,
      or an admission of, fault, culpability or any failure to act, by or on
      behalf of the Agent or the Agent’s
  Personnel.

            

    

     

    Notwithstanding the foregoing, the
Company shall not be liable for the settlement of any claim or action in respect
of which indemnity may be sought hereunder effected without its written consent,
which consent shall not be unreasonably withheld.

     

    
      	
              (d)

            	
              If any matter or thing
      contemplated by this Section 8 shall be asserted against any party in
      respect of which indemnification is or might reasonably be considered to
      be provided (an “Indemnified
      Party”), such
      Indemnified Party will notify the Company as soon as possible and in any
      event on a timely basis, of the nature of such claim, provided, however,
      that the omission to so notify the Company shall not relieve the Company
      from any liability which the Company may have to any Indemnified Party
      hereunder unless the Company is materially prejudiced by such omission.
      The Company shall be entitled (but not required) to assume the defence of
      any suit brought to enforce such claim; provided, however, that the
      defence shall be through legal counsel acceptable to the Indemnified
      Party, acting reasonably, and that no settlement may be made by the
      Company or the Indemnified Party without the prior written consent of the
      other.

            

    

     

    
      	
              (e)

            	
              The foregoing indemnity shall not
      apply to the extent that a court of competent jurisdiction in a final
      judgment that has become non-applicable shall determine that such losses,
      expenses, claims, damages or liabilities to which the Indemnified Party
      may be subject were caused by the fraud, gross negligence, wilful
      misconduct or bad faith of an Indemnified
  Party.

            

    

     

    
      	
              (f)

            	
              In any such claim, the Indemnified
      Party shall have the right to retain other counsel to act on the
      Indemnified Party’s behalf, provided that the fees and disbursements of
      such other counsel reasonably incurred shall be paid by the Indemnified
      Party, unless (i) the Company and the Indemnified Party mutually agree to
      retain such other counsel or (ii) the named parties to any such claim
      (including any third or implicated party) include both the Indemnified
      Party, on the one hand, and the Company, on the other hand, and the
      representation of the Company and the Indemnified Party by the same
      counsel would be inappropriate due to actual or potential conflicting
      interests, in which event such fees and disbursements shall be paid by the
      Company to the extent that they have been reasonably incurred; provided
      that in no circumstances shall the Company be required to pay the fees and
      disbursements of more than one set of counsel for all Indemnified
      Parties.

            

    

     

    
      	
              (g)

            	
              The Company hereby waives all
      rights which it may have by statute or common law to recover contribution
      from the Agent in respect of losses, claims, costs, damages, expenses or
      liabilities which any of them may suffer or incur directly or indirectly
      (in this paragraph, “losses”) by reason of or in consequence of a document
      containing a misrepresentation; provided, however, that such waiver shall
      not apply in respect of losses by reason of or in consequence of any
      misrepresentation which is based upon or results from information or
      statements furnished by the
Agent.

            

    

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

     

    
      	
              9.

            	
              Contribution.

            

    

     

    If the indemnification provided for
herein is for any reason unavailable to or insufficient to hold
harmless an Indemnified Party in respect of any losses, liabilities, claims,
damages or expenses referred to therein, then the Company shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such Indemnified Party (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company on the one hand and the
Agent on the other hand from the Offering or (ii) if the allocation provided by
clause (i) is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company, on the one hand, and of the
Agent, on the other hand, in connection with the statements or omissions which
resulted in such losses, liabilities, claims, damages or expenses, as well as
any other relevant equitable considerations.

     

    The
relative benefits received by the Company, on the one hand, and the Agent, on
the other hand, in connection with the Offering shall be deemed to be in the
same respective proportions as the total net proceeds from the Offering (before
deducting expenses) received by the Company and the total fee received by the
Agent pursuant to Section 4. The relative fault of the Company, on the one hand,
and the Agent, on the other hand, shall be determined by reference to, among
other things, whether any such untrue or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact relates to
information supplied by the Company or by the Agent and the parties’ relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.

     

    The
aggregate amount of losses, liabilities, claims, damages and expenses incurred
by an Indemnified Party and referred to above shall be deemed to include any
legal or other expenses reasonably incurred by such Indemnified Party in
investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.

     

    Notwithstanding
the foregoing provisions, the Agent shall not be required to contribute any
amount in excess of the aggregate fees actually received by the Agent from the
Company.

     

    No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) or a misrepresentation, as defined in Canadian Securities
Laws, that is fraudulent shall be entitled to contribution from any person who
was not guilty of such fraudulent misrepresentation.

     

    The
rights of contribution provided herein shall be in addition to and not in
derogation of any right to contribute which the Agent may have by statute or
otherwise.

     

    
      	
              10.

            	
              Severability.

            

    

     

    If any provision of Sections 8 and 9 is
determined to be void or unenforceable in whole or in part, it shall be deemed
not to affect or impair the validity of any other provision of this Agreement
and such void or unenforceable provision shall be severable from this
Agreement.

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

     

    
      	
              11.

            	
              Survival
      of Representations and Agreements.

            

    

     

    All warranties, representations,
covenants and agreements herein contained or contained in any documents
submitted pursuant to this Agreement and in connection with the transaction
herein contemplated shall survive the purchase and sale of the Units and
continue in full force and effect for the benefit of the Agent for a period the
two years following the Closing Date and shall not be limited or prejudiced by
any investigation made by or on behalf of the Agent in connection with the
purchase and sale of the Units or the preparation of the Base Prospectuses,
Pricing Prospectuses, Prospectuses or otherwise. This Agreement shall constitute
the entire agreement with respect to the Offering among the parties and
supersedes any other previous agreement between the parties with respect to the
Offering.

     

    
      	
              12.

            	
              Effective
      Date of Agreement; Termination.

            

    

     

    
      	
              (a)

            	
              This Agreement shall become
      effective when the parties hereto have executed and delivered this
      Agreement.

            

    

     

    
      	
              (b)

            	
              The Agent shall have the right to
      terminate this Agreement at any time prior to the Closing Date, by notice
      in writing to the Company, if, at or after the Applicable
      Time:

            

    

     

    
      	
               
      

            	
              (i)

            	
              there shall have occurred any
      material change or change in any material fact, or there shall be
      discovered any previously undisclosed material change or material fact
      which was required to be disclosed in the Prospectuses or otherwise,
      which, in each case, in the reasonable opinion of the Agent, has or would
      be expected to have a material adverse effect on the market price or value
      of any of the securities of the Company, including, without limitation,
      the Units;

            

    

     

    
      	
               
      

            	
              (ii)

            	
              any inquiry, action, suit,
      proceeding or investigation (whether formal or informal) in relation to
      the Company or any of the directors, officers or principal shareholders of
      the Company (including matters of regulatory transgression or unlawful
      conduct), is commenced, announced or threatened or any order made by any
      federal, provincial, state, municipal or other governmental department,
      commission, board, bureau, agency or instrumentality including, without
      limitation, the TSX.V and Amex or any securities regulatory authority, or
      any law or regulation is enacted or changed which, in any such case, in
      the opinion of the Agent, acting reasonably, operates to prevent or
      restrict the trading of the common shares of the Company or any other
      securities of the Company or materially and adversely affects or will
      materially and adversely affect the market price or value of the common
      shares or any other securities of the
  Company;

            

    

     

    
      	
               
      

            	
              (iii)

            	
              trading in the Company’s common
      shares shall have been suspended by the Commission, the Canadian
      Qualifying Authorities, the TSX.V or Amex, or trading in securities
      generally on the TSX.V or Amex shall have been suspended or been made
      subject to material limitations, or minimum or maximum prices for trading
      shall have been fixed, or maximum ranges for prices for securities shall
      have been required, on the TSX.V or Amex or by order of the Commission or
      any other governmental authority having
    jurisdiction;

            

    

     

    
      	
               
      

            	
              (iv)

            	
              the state of the financial markets
      is such that, in the sole opinion of the Agent, the Units cannot be
      profitably marketed;

            

    

     

    
      	
               
      

            	
              (v)

            	
              the Company is in breach of any
      material term of this
Agreement;

            

    

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (vi)

            	
              the Agent determines that any of
      the representations or warranties made by the Company in this Agreement
      are false or have become
false;

            

    

     

    
      	
               
      

            	
              (vii)

            	
              if there is a failure by the
      Company, or otherwise, of the satisfaction of any of the conditions
      precedent set out in this
Agreement;

            

    

     

    
      	
               
      

            	
              (viii)

            	
              the Agent is not satisfied with
      the results of its due diligence of the Company prior to the Closing Date,
      acting reasonably; or

            

    

     

    
      	
               
      

            	
              (ix)

            	
              there is a catastrophe of national
      or international consequence or an event, accident, governmental law or
      regulation or other occurrence of any nature which, in the opinion of the
      Agent, seriously affects or will seriously affect the financial markets,
      or the business of the Company on a consolidated basis, or the ability of
      the Agent to perform its obligations under this Agreement, or a
      purchaser’s decision to purchase the
  Units.

            

    

     

    13.           Notices.  Any notice under this
Agreement will be given in writing and must be delivered, sent by facsimile
transmission or mailed by prepaid post and addressed to the party to which
notice is to be given at the address indicated below, or at another address
designated by the party in writing.

     

    
      	
              if
      to the Company:

            	
              if
      to the Agent:

            
	 	 
	Midway
      Gold Corp.	Haywood
      Securities Inc.
	600
      Lola Street, Suite 10	2000-400
      Burrard Street
	Helena,
      Montana 59601	Vancouver,
      BC V6C 3A6
	 	 
	Attention:	Daniel Wolfus	Attention:	Kevin
      Campbell
	Facsimile:
      	(406)
      475-9596	Facsimile:	(604)
      697-7495
	 	 	 	 
	with
      a copy to:	with
      a copy to:
	 	 
	Stikeman
      Elliott LLP	Blake,
      Cassels & Graydon LLP
	Suite
      1700, 666 Burrard Street	Suite
      2600, 595 Burrard Street
	Vancouver,
      BC V6C 2X8	Vancouver
      BC  V7X 1L3
	 	 
	Attention:	John
      Anderson	Attention:	Bob
      Wooder
	Facsimile:	(604)
      681-1825	Facsimile:	(604)
      631-3309

    

     

    If notice
is sent by facsimile transmission or is delivered, it will be deemed to have
been given at the time of transmission or delivery.  If notice is
mailed, it will be deemed to have been received 48 hours following the date of
mailing of the notice.  If there is an interruption in normal mail
service due to strike, labour unrest or other cause at or prior to the time a
notice is mailed the notice will be sent by facsimile transmission or will be
delivered.

     

    
      	
              14.

            	
              Governing
      Law.

            

    

     

    This
Agreement shall be governed by and construed in accordance with the laws of the
Province of British Columbia and the laws of Canada applicable
therein.

     

    
      	
              15.

            	
              No
      Fiduciary Relationship.

            

    

     

    The Company hereby acknowledges that the
Agent is acting solely as agent in connection with the Offering contemplated
hereby.  The Company further acknowledges that the Agent is acting
pursuant to a contractual relationship created solely by this Agreement entered
into on an arm’s length basis, and in no event do the parties intend that the
Agent act or be responsible as a fiduciary to the Company, its management,
shareholders or creditors or any other person in connection with any activity
that the Agent may undertake or have undertaken in furtherance of the Offering,
either before or after the date hereof.  The Agent hereby expressly
disclaims any fiduciary or similar obligations to the Company, either in
connection with the transactions contemplated by this Agreement or any matters
leading up to such transactions, and the Company hereby confirms its
understanding and agreement to that effect.  The Company and the Agent
agree that they are each responsible for making their own independent judgments
with respect to any such transactions and that any opinions or views expressed
by the Agent to the Company regarding such transactions, including, but not
limited to, any opinions or views with respect to the price or market for the
Company’s securities, do not constitute advice or recommendations to the
Company.  The Company and the Agent agree that the Agent is acting as
agent and not a fiduciary of the Company and the Agent has not assumed, nor will
assume, any advisory responsibility in favour of the Company with respect to the
transactions contemplated hereby or the process leading thereto (irrespective of
whether the Agent has advised or is currently advising the Company on other
matters).  The Company hereby waives and releases, to the fullest
extent permitted by law, any claims that the Company may have against the Agent
with respect to any breach or alleged breach of any fiduciary, advisory or
similar duty to the Company in connection with the transactions contemplated by
this Agreement or any matters leading up to such
transactions.

     

    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

    

     

    
      	
              16.

            	
              Agent
      Information.

            

    

     

    The parties hereto acknowledge and agree
that, for the purposes of this Agreement, the information provided by or on
behalf of the Agent consists solely of the name of the Agent contained on the
cover of the Pricing Prospectuses and the Prospectuses.

     

    
      	
              17.

            	
              Currency

            

    

     

    Except as otherwise indicated, all
amount expressed herein in terms of money refer to lawful currency of
Canada and all payments to be made hereunder
shall be made in such currency.  References to “US$” are references to
United States dollars.

     

    
      	
              18.

            	
              Headings.

            

    

     

    The headings herein are inserted for
convenience of reference only and are not intended to be part of, or to affect
the meaning or interpretation of, this Agreement.

     

    
      	
              19.

            	
              Time
      is of the Essence.

            

    

     

    Time shall be of the essence of this
Agreement.  As used herein, the term “business day” shall mean
any day other than a
Saturday, Sunday or statutory or civic holiday in the city of Vancouver, British Columbia or Toronto, Ontario.

     

    
      	
              11.

            	
              Counterparts.

            

    

     

    This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original, but all
such counterparts shall together constitute one and the same instrument.
Delivery of a signed counterpart of this Agreement by facsimile transmission
shall constitute valid and sufficient delivery thereof.

     

    [signature
page follows]

     

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

    

     

    If the
foregoing correctly sets forth your understanding, please so indicate in the
space provided below for that purpose, whereupon this agreement shall constitute
a binding agreement among us.

     

     

    
      	 	Very truly yours,
      

              

              HAYWOOD
      SECURITIES INC.

            
	 	 
	 	 	 
	 	By:	 
      
	 	 
      	
              Name:

            	
              Kevin Campbell

            
	 	 
      	
              Title:

            	
              Managing Director, Investment
      Banking

            

    

     

    Accepted
as of the date first above written

     

    MIDWAY
GOLD CORP.

     

     

    
      	By:	   
      	 
	 
      	
              Name:

            	
              Kenneth Brunk

            	 
	 
      	
              Title:

            	
              President and Chief Operating
      Officer

            	 

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    EXHIBIT A

     

    Material
Subsidiaries

     

    
      	
              Name of
      Subsidiary

            	
              Jurisdiction

            
	 	 
	
              MGC
      Resources Inc.

            	
              Nevada

            
	
              MGC
      Properties Inc.

            	
              Nevada

            
	
              Pan-Nevada
      Gold Corporation

            	
              British
      Columbia

            
	
              GEH
      (B.C.) Holding Inc.

            	
              British
      Columbia

            
	
              GEH
      (U.S.) Holding Inc.

            	
              Nevada

            
	
              Golden
      Eagle Holding Inc.

            	
              Washington

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Schedule “A”

     

    Form of
Opinion of Stikeman Elliott
LLP

     

    
      	
              1.

            	
              Each
      of the Company, Pan-Nevada Gold Corporation (“PNG”) and GEH (B.C.)
      Holding Inc. (“GEH”) is a corporation
      incorporated and existing and in good standing under the laws of the
      Province of British Columbia.

            

    

     

    
      	
              2.

            	
              All
      of the issued and outstanding shares of GEH and PNG are registered in the
      name of the Company.

            

    

     

    
      	
              3.

            	
              The
      Company has all requisite corporate capacity, power and authority under
      the laws of the Province of British Columbia to carry on its business as
      now conducted by it and to own its properties and assets, in each case, as
      described in the Prospectus.

            

    

     

    
      	
              4.

            	
              The
      Company has all necessary corporate power to enter into and perform its
      obligations under the Agency Agreement and the Warrant
      Indenture.

            

    

     

    
      	
              5.

            	
              Each
      of the Agency Agreement and the Warrant Indenture has been duly
      authorized, executed and delivered by the Company as a matter of corporate
      law in compliance with the laws of the Province of British Columbia and
      constitutes a legal, valid and binding agreement of the Company
      enforceable against it in accordance with its respective terms under with
      the laws of the Province of British
Columbia.

            

    

     

    
      	
              6.

            	
              The
      execution and delivery of and performance by the Company of the Agency
      Agreement and the Warrant Indenture and compliance by the Company with its
      obligations under the Agency Agreement and the Warrant Indenture does not
      and will not, whether with or without the giving of notice or lapse of
      time or both, result in any violation
of:

            

    

     

    
      	
               
      

            	
              (a)

            	
              any
      law of general application in the Canadian
  Jurisdictions;

            

    

     

    
      	
               
      

            	
              (b)

            	
              the
      Notice of Articles or Articles of the Company;
  or

            

    

     

    
      	
               
      

            	
              (c)

            	
              any
      resolutions of the board of directors (or any committee thereof) of the
      Company relating to the Offering and attached to the Officer’s
      Certificate.

            

    

     

    
      	
              7.

            	
              All
      necessary corporate action has been taken by the Company to authorize the
      filings of each of the Canadian Final Base Shelf Prospectus and the Final
      Canadian Prospectus Supplement with the Securities
      Commissions.

            

    

     

    
      	
              8.

            	
              All
      necessary corporate action has been taken by the Company to authorize the
      filing of the Company’s prospectus dated May 6, 2010 and the US Prospectus
      Supplement relating to the Offering dated November [●], 2010 with the
      Commission.

            

    

     

    
      	
              9.

            	
              Subject
      to receipt of payment in full for them, the Offered Shares will be validly
      issued as fully paid and non-assessable shares in the capital of the
      Company.

            

    

     

    
      	
              10.

            	
              All
      necessary corporate action has been taken by the Company to authorize the
      creation and issue of the Warrants.

            

    

     

    
      
        
        

      

      
        A-1

        
          

        

      

      
        
        

      

    

     

    
      	
              11.

            	
              The
      reservation and issuance of the Warrant Shares in accordance with the
      terms of the Warrant Indenture has been authorized by all necessary
      corporate action on the part of the Company and, upon the due and proper
      exercise of the Warrants in accordance with the terms of the Warrant
      Indenture, the Warrant Shares will be issued as fully paid and
      non-assessable shares in the capital of the
  Company.

            

    

     

    
      	
              12.

            	
              The
      form of certificate used to evidence each of the Offered Shares has been
      approved and adopted by the Company and complies in all material respects
      with (i) applicable statutory requirements, (ii) any applicable
      requirements of the articles of the Company, and (iii) the applicable
      requirements of the TSX.V for such
certificates.

            

    

     

    
      	
              13.

            	
              The
      authorized capital of the Company consists of an unlimited number of
      Common Shares without par value.  The statements in the
      Prospectus under the heading “Description of Share Capital – Common
      Shares” fairly summarize such legal matters in all material
      respects.  The attributes and characteristics of the Offered
      Shares, the Warrant Shares and the Warrants conform in all material
      respects to the attributes and characteristics thereof described in the
      Prospectus.

            

    

     

    
      	
              14.

            	
              The
      statements in the Prospectus under the heading “Eligibility for
      Investment” and Certain Canadian Federal Income Tax Considerations” fairly
      summarize such legal matters in all material
  respects.

            

    

     

    
      	
              15.

            	
              All
      necessary documents have been filed, all necessary proceedings have been
      taken and all necessary authorizations, approvals, permits, consents and
      orders have been obtained in each case under the Applicable Canadian
      Securities Laws of each of the Canadian Jurisdictions to qualify the
      distribution of the Offered Shares and the Warrants to the public in each
      of the Canadian Jurisdictions through registrants registered under the
      Applicable Canadian Securities Laws (including related and applicable
      regulations and rules) of the Canadian Jurisdictions who have complied
      with the applicable provisions of such Applicable Canadian Securities
      Laws.

            

    

     

    
      	
              16.

            	
              The
      issue, sale and delivery by the Company of the Warrant Shares, when issued
      in accordance with the terms and conditions of the Warrants will be exempt
      from, or is not subject to, the prospectus requirements of the Applicable
      Canadian Securities Laws in the Canadian Jurisdictions and no prospectus
      or other documents are required to be filed, proceeding taken, or
      approvals, permits, consents or authorizations obtained under such
      Applicable Canadian Securities Laws in the Canadian Jurisdictions in
      respect of such distribution, other than such as have been filed, taken or
      obtained.

            

    

     

    
      	
              17.

            	
              The
      first trade of the Warrant Shares issuable upon the exercise of the
      Warrants will be exempt from, or will not be subject to, the prospectus
      requirements of the Applicable Canadian Securities Laws of the Canadian
      Jurisdictions and no filing, proceeding or approval will need to be made,
      taken or obtained by the Company under such Applicable Canadian Securities
      Laws in connection with such trade, provided that the trade is not a
      “control distribution”, as such term is defined in National Instrument
      45-102 – Resale of Securities.

            

    

     

    
      	
              18.

            	
              The
      Company is a “reporting issuer” under Applicable Canadian Securities Laws
      of each Canadian Jurisdiction that recognizes the concept of reporting
      issuer and is not on the list of defaulting reporting issuers maintained
      under Applicable Canadian Securities Laws in such provinces, if
      any.

            

    

     

    
      	
              19.

            	
              The
      TSX.V has conditionally approved the listing of all of the Offered Shares
      and the Warrant Shares, subject to the satisfaction by the Company of the
      conditions set forth in the Conditional Listing
  Letter.

            

    

     

    
      
        
        

      

      
        A-2

        
          

        

      

      
        
        

      

    

     

    Schedule “B”

     

    Form of
Dorsey & Whitney LLP

     

    
      	
              1.

            	
              To
      such counsel’s knowledge, and other than as set forth in the U.S.
      Preliminary Prospectus and the U.S. Prospectus, there are no judicial,
      regulatory or other legal or governmental proceedings pending by or before
      any court or governmental agency, authority or body to which the Company
      is a party or of which any property of the Company is the subject which,
      if determined adversely to the Company, would individually or in the
      aggregate have a Material Adverse Effect; and, to the best of our
      knowledge, no such proceedings are threatened or
    contemplated.

            

    

     

    
      	
              2.

            	
              The
      issuance and sale of the Units by the Company, the compliance by the
      Company with all of the provisions of the Agency Agreement and the
      performance by the Company of its obligations thereunder will not violate
      Applicable Law or any judgment, order or decree of any court or arbitrator
      known to such counsel.  For purposes of this letter, the term
      “Applicable Law” means those laws, rules and regulations of the federal
      government of the United States of America which in such counsel’s
      experience are normally applicable to the transactions of the type
      contemplated by the Agency Agreement, except that, “Applicable Law” does
      not include the anti-fraud provisions of the securities laws of any
      applicable jurisdiction or any state securities or Blue Sky laws of the
      various states.

            

    

     

    
      	
              3.

            	
              No
      consent, approval, authorization or order of, or filing, registration or
      qualification with, any Governmental Authority, is required by the Company
      under any Applicable Law for the issuance or sale of the Units or the
      performance by the Company of its obligations under the Agency Agreement
      except for (1) such as may be required under state securities or blue sky
      laws in connection with the offer and sale of the Units, Shares, Warrants
      and Warrant Shares (as to which we express no opinion) and (2) such as
      have been made or obtained under the Securities Act.  For
      purposes of this letter, the term “Governmental Authority” means any
      executive, legislative, judicial, administrative or regulatory body of the
      federal government of the United States of
  America.

            

    

     

    
      	
              4.

            	
              The
      Registration Statement, the U.S. Preliminary Prospectus and the U.S.
      Prospectus, and each amendment or supplement thereto (except for the
      financial statements, financial statement schedules and other financial
      data included therein or omitted therefrom as to which we express no
      opinion), as of their respective effective or issue dates, comply as to
      form in all material respects with the requirements of the U.S. Securities
      Act and the rules and regulations
thereunder.

            

    

     

    
      	
              5.

            	
              The
      documents incorporated by reference into the Registration Statement, the
      U.S. Preliminary Prospectus and the U.S. Prospectus (except for the
      financial statements, financial statement schedules and other financial
      data included therein or omitted therefrom as to which we express no
      opinion) when they were filed with the Commission, complied as to form in
      all material respects with the requirements of the U.S. Exchange Act and
      the rules and regulations
thereunder.

            

    

     

    
      	
              6.

            	
              The
      statements included in the U.S. Preliminary Prospectus Supplement and the
      U.S. Prospectus Supplement under the heading “Certain United States
      Federal Income Tax Considerations” insofar as such statements summarize
      legal matters discussed therein, are accurate and fair summaries of such
      legal matters in all material
respects.

            

    

     

    
      	
              7.

            	
              The
      Company is not and, after giving effect to the Offering, and the
      application of their proceeds as described in the U.S. Prospectus under
      the heading “Use of proceeds,” will not be required to be registered as an
      investment company under the Investment Company Act of 1940, as amended,
      and the rules and regulations of the Commission promulgated
      thereunder.

            

    

     

    
      
        
        

      

      
        B-1

        
          

        

      

      
        
        

      

    

     

    Schedule “C”

     

    Pricing Terms included in the Disclosure
Package

     

    
      	
              Number of
      Units:

            	
              6,660,000

            
	 	 
	
              Public Offering Price per
      Unit

            	
              US$0.60

            
	 	 
	
              Agent commission per
      Unit:

            	
              US$0.036 per Unit
      (6%)

            
	 	 
	
              Date of Delivery of
      Units:

            	
              On or about November 22,
      2010

            

    

     

    Issuer
Free Writing Prospectuses

     

    Canadian
Preliminary Prospectus Supplement

     

    
      
        
        

      

      
        C-1

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00181-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00181-of-00352.parquet"}]]