Document:

Filed by Automated Filing Services Inc. (604) 609-0244 - Taseko Mines Limited - Exhibit 4.17

SHAREHOLDER RIGHTS PLAN AGREEMENT

DATED EFFECTIVE AS OF FEBRUARY 13, 2007 

 

between 

TASEKO MINES LIMITED 

and 

COMPUTERSHARE INVESTOR SERVICES INC. 

as Rights Agent 

TABLE OF CONTENTS 

	ARTICLE
      1 - INTERPRETATION 	1
      
	     1.1
      	Certain
      Definitions 	1
      
	     1.2
      	Holder
      	11
      
	     1.3
      	Acting
      Jointly or in Concert 	12
      
	     1.4
      	Application
      of Statutes, Regulations and Rules 	12
      
	     1.5
      	Currency
      	12
      
	     1.6
      	Headings
      and References 	12
      
	     1.7
      	Singular,
      Plural, etc. 	12
      
	  	  	  
	ARTICLE
      2 - THE RIGHTS 	12
      
	     2.1
      	Legend
      on Common Share Certificates 	12
      
	     2.2
      	Initial
      Exercise Price: Exercise of Rights: Detachment of Rights 	13
      
	     2.3
      	Adjustments
      to Exercise Price, Number of Rights 	15
      
	     2.4
      	Date
      on Which Exercise is Effective 	18
      
	     2.5
      	Execution,
      Authentication, Delivery and Dating of Rights Certificates 	18
      
	     2.6
      	Registration,
      Registration of Transfer and Exchange 	19
      
	     2.7
      	Mutilated,
      Destroyed, Lost and Stolen Rights Certificates 	19
      
	     2.8
      	Persons
      Deemed Owners 	20
      
	     2.9
      	Delivery
      and Cancellation of Certificates 	20
      
	     2.10
      	Agreement
      of Rights Holders 	20
      
	     2.11
      	Rights
      Certificate Holder Deemed Not a Shareholder 	21
      
	  	  	  
	ARTICLE
      3 - ADJUSTMENTS TO THE RIGHTS IN THE EVENT OF CERTAIN TRANSACTIONS 	21
      
	     3.1
      	Flip-in
      Event 	21
      
	  	  	  
	ARTICLE
      4 - THE RIGHTS AGENT 	22
      
	     4.1
      	General
      	22
      
	     4.2
      	Merger
      or Amalgamation or Change of Name of Rights Agent 	23
      
	     4.3
      	Duties
      of Rights Agent 	23
      
	     4.4
      	Change
      of Rights Agent 	24
      
	  	  	  
	ARTICLE
      5 - MISCELLANEOUS 	25
      
	     5.1
      	Redemption
      and Waiver 	25
      
	     5.2
      	Expiration
      	26
      
	     5.3
      	Issuance
      of New Rights Certificates 	26
      
	     5.4
      	Supplements
      and Amendments 	26
      
	     5.5
      	Fractional
      Rights and Fractional Common Shares 	27
      
	     5.6
      	Rights
      of Action 	27
      
	     5.7
      	Holder
      of Rights Not Deemed a Shareholder 	28
      
	     5.8
      	Non-Canadian
      or United States Holders 	28
      
	     5.9
      	Notices
      	28
      
	     5.10
      	Costs
      of Enforcement 	29
      
	     5.11
      	Successors
      	29
      
	     5.12
      	Benefits
      of this Agreement 	29
      
	     5.13
      	Governing
      Law 	29
      
	     5.14
      	Counterparts
      	30
      
	     5.15
      	Severability
      	30
      
	     5.16
      	Determinations
      and Actions by the Board of Directors 	30
      
	     5.17
      	Regulatory
      Approvals 	30
      

- i - 

SHAREHOLDER RIGHTS PLAN AGREEMENT 

SHAREHOLDER RIGHTS PLAN AGREEMENT dated effective as of
February 13, 2007 between TASEKO MINES LIMITED a corporation incorporated
under the Business Corporations Act (British Columbia) (the
“Corporation”) and COMPUTERSHARE INVESTOR SERVICES INC., a trust
company incorporated under the laws of Canada, as rights agent (the “Rights
Agent”), which term shall include any successor Rights Agent hereunder).

WHEREAS the Board of Directors has determined it advisable and
in the best interests of the Corporation to adopt a shareholder rights plan
agreement (the “Rights Plan”) to ensure, to the extent possible, that all
shareholders of the Corporation are treated fairly in connection with any
take-over offer for the Corporation; and 

WHEREAS in order to implement the Rights Plan, the Board of
Directors has authorized the issuance of one right (“Right”): 

	(a) 	
      effective at the Record Time (as hereinafter defined) in
      respect of each Common Share (as hereinafter defined) outstanding at the
      Record Time; and

	 	 
	(b) 	
      in respect of each Common Share issued after the Record
      Time and prior to the earlier of the Separation Time (as hereinafter
      defined) and the Expiration Time (as hereinafter
  defined);

WHEREAS the Corporation desires to appoint a Rights Agent to
act on behalf of the Corporation and the holders of Rights, and the Rights Agent
was willing to so act, in connection with the issuance, transfer, exchange and
replacement of Rights Certificates (as hereinafter defined), the exercise of
Rights and other matters referred to herein; 

WHEREAS each Right entitles the holder thereof, after the
Separation Time, to purchase securities of the Corporation pursuant to the terms
and subject to the conditions set forth therein; and 

WHEREAS the Board of Directors has resolved to seek the
ratification of the Corporation’s shareholders, by way of ordinary resolution
within 180 days of the date hereof, of the adoption of this Rights Plan. 

NOW THEREFORE, in consideration of the premises and the
respective agreements set forth herein, the Corporation and the Rights Agent
hereby agree as follows: 

ARTICLE 1 - INTERPRETATION 

	1.1 	Certain Definitions 

In this Agreement, unless the context
otherwise requires: 

	 	(a) 	
      “Acquiring Person” means any Person who is the
      Beneficial Owner of 20% or more of the outstanding Voting Shares;
      provided, however, that the term “Acquiring Person” shall
      not include:

	 	 	 	 
	 		(i) 	
      the Corporation or any Subsidiary of the Corporation,
      or

	 	 	 	 
	 		(ii) 	
      an underwriter or member of a banking or selling group
      that acquires Voting Shares from the Corporation in connection with a
      distribution of securities, or

	 	 	 	 
	 		(iii) 	
      any Person who becomes the Beneficial Owner of 20% or
      more of the outstanding Voting Shares as a result of one or any
      combination of:

- 1 - 

	 	(A) 	
      a Voting Share Reduction which, by reducing the number of
      Voting Shares outstanding, increases the percentage of Voting Shares
      Beneficially Owned by such Person to 20% or more of the Voting Shares then
      outstanding,

	 	 	 
	 	(B) 	
      a Permitted Bid Acquisition,

	 	 	 
	 	(C) 	
      an Exempt Acquisition,

	 	 	 
	 	(D) 	
      a Pro-Rata Acquisition, or

	 	 	 
	 	(E) 	
      a Convertible Security
Acquisition,

in each such case, until such time
thereafter as such Person shall become the Beneficial Owner (otherwise than
pursuant to any one or more of a Voting Share Reduction, a Permitted Bid
Acquisition, an Exempt Acquisition, a Pro-Rata Acquisition, or a Convertible
Security Acquisition) of additional Voting Shares constituting more than 1% of
the Voting Shares then outstanding, in which event such Person shall become an
Acquiring Person as of the date and time of acquisition of such additional
Voting Shares; or 

	 		(iv) 	
      for a period of 10 days after the Disqualification Date
      (as hereinafter defined), any Person who becomes the Beneficial Owner of
      20% or more of the outstanding Voting Shares as a result of such Person
      becoming disqualified from relying on clauses (vi) or (viii) of the
      definition of Beneficial Owner. In this definition, “Disqualification
      Date” means the first date of public announcement of facts indicating
      that such Person has or is making or has announced an intention to make a
      Take-over Bid alone or by acting jointly or in concert with any other
      Person; or

	 	 	 	 
	 		(v) 	
      a Person (a “Grandfathered Person”) who is the
      Beneficial Owner of 20% or more of the outstanding Voting Shares as of the
      Record Time; provided, however, that the exemption shall not be applicable
      to any Grandfathered Person in the event that such Grandfathered Person
      shall, after the Record Time, become the Beneficial Owner of additional
      Voting Shares such that its Beneficial Ownership of Voting Shares is
      increased by more than 1% of the number of Voting Shares then outstanding
      (otherwise than pursuant to any one or more of a Voting Share Reduction, a
      Permitted Bid Acquisition, an Exempt Acquisition, a Pro-Rata Acquisition,
      or a Convertible Security Acquisition).

	 	 	 	 
	 	(b) 	
      “Affiliate”, when used to indicate a relationship
      with a specified corporation, means a Person that directly, or indirectly
      through one or more controlled intermediaries, controls, or is controlled
      by, or is under common control with, such specified corporation.

	 	 	 	 
	 	(c) 	
      “Agreement” means this Shareholder Rights Plan
      Agreement as amended and supplemented from time to time.

	 	 	 	 
	 	(d) 	
      “Associate”, when used to indicate a relationship
      with a specified Person, means (i) a spouse of such specified Person, (ii)
      any Person of either sex with whom such specified Person is living in a
      conjugal relationship outside marriage or (iii) any relative of such
      specified Person or of a Person mentioned in clauses (i) or (ii) of this
      definition if that relative has the same residence as the specified
      Person.

	 	 	 	 
	 	(e) 	
      A Person shall be deemed the “Beneficial Owner”
      and to have “Beneficial Ownership” of and to “Beneficially
      Own”, any securities:

	 	 	 	 
	 		(i) 	
      of which such Person or any of such Person’s Affiliates
      or Associates is the owner at law or in equity;

- 2 - 

	 	(ii) 	
      as to which such Person or any of such Person’s
      Affiliates or Associates has the right to become owner at law or in equity
      (where such right is exercisable within 60 days, whether or not on
      condition or the happening of any contingency or the making of any
      payment) pursuant to any agreement, arrangement, pledge or understanding,
      including but not limited to any Lock-Up Agreement or similar agreement,
      arrangement or understanding that is not a Permitted Lock-Up Agreement,
      whether or not in writing (other than (x) customary agreements with and
      between underwriters and/or banking group members and/or selling group
      members with respect to a public offering or private placement of
      securities, and (y) pledges of securities in the ordinary course of
      business), or upon the exercise of any Convertible Securities;
  and

	 	 	 
	 	(iii) 	
      which are Beneficially Owned within the meaning of
      clauses (i) or (ii) of this definition by any other Person with which such
      Person is acting jointly or in concert;

provided, however, that a
Person shall not be deemed the “Beneficial Owner”, or to have
“Beneficial Ownership” of, or to “Beneficially Own”, any security:

	 	(iv) 	
      by reason of such security having been deposited or
      tendered pursuant to a tender or exchange offer or Take-over Bid made by
      such Person or any of such Person’s Affiliates or Associates or any other
      Person referred to in clause (iii) of this definition until the earlier of
      such deposited or tendered security being accepted unconditionally for
      payment or exchange or being taken up and paid for;

	 	 	 	 
	 	(v) 	
      by reason of the holder of such security having agreed to
      deposit or tender such security to a Take-over Bid made by such Person or
      any of such Person’s Affiliates or Associates or any other Person referred
      to in clause (iii) of this definition pursuant to a Permitted Lock-up
      Agreement;

	 	 	 	 
	 	(vi) 	
      by reason of such Person, any of such Person’s Affiliates
      or Associates or any other Person referred to in clause (iii) of this
      definition holding such security, provided that:

	 	 	 	 
	 		(A) 	
      the ordinary business of the Person (in this definition,
      the “Manager”) includes the management of mutual funds or
      investment funds for others (which others may include or be limited to one
      or more employee benefit plans or pension plans) and such security is held
      by the Manager in the ordinary course of such business in the performance
      of such Manager’s duties for the account of any other Person (in this
      definition, a “Client”), including non-discretionary accounts held
      on behalf of a Client by a dealer or broker registered under applicable
      laws;

	 	 	 	 
	 		(B) 	
      the Person (in this definition, a “Trust Company”)
      is licensed to carry on the business of a trust company under applicable
      law and, as such, acts as a trustee or administrator or in a similar
      capacity in relation to the estates of deceased or incompetent Persons
      (each, in this definition, an “Estate Account”) or in relation to
      other accounts (each, in this definition, an “Other Account”) and
      holds such security, and is acting, in the ordinary course of such duties
      for the Estate Account or for such Other Accounts;

	 	 	 	 
	 		(C) 	
      the ordinary business of such Person includes acting as
      an agent of the Crown in the management of public assets (in this
      definition, the “Crown Agent”);

	 	 	 	 
	 		(D) 	
      the Person is an independent Person established by
      statute for purposes that include, and the ordinary business or activity
      of such Person (in this definition, the “Statutory Body”) includes,
      the management of investment funds for employee benefit plans, pension
      plans, insurance plans of various public bodies

- 3 - 

	 			and the Statutory Body holds such security for the purposes of its
      activities as such; or
	 	 	 	 
	 		(E) 	
      the Person (in this definition, the
      “Administrator”) is the administrator or trustee of one or more
      pension funds or plans (each, in this definition, a “Plan”) or is a
      Plan registered under the laws of Canada or any province thereof or the
      corresponding laws of the jurisdiction by which such Plan is governed and
      the Administrator or Plan holds such security for the purposes of its
      activities as such;

	 	 	 	 
	 		
      but only if the Manager, the Trust Company, the Crown
      Agent, the Statutory Body, the Administrator or the Plan, as the case may
      be, is not then making and has not announced a current intention to make a
      Take-over Bid, other than an Offer to Acquire Common Shares or other
      securities pursuant to a distribution by the Corporation or by means of
      ordinary market transactions (including prearranged trades entered into in
      the ordinary course of business of such Person) executed through the
      facilities of a stock exchange or an organized over-the-counter market,
      alone or by acting jointly or in concert with any other Person;

	 	 	 	 
	 	(vii) 	
      because such Person, or any other Person acting jointly
      or in concert with such Person is:

	 	 	 	 
	 		(A) 	
      a Client of the same Manager as another Person on whose
      account the Manager holds such security, or

	 	 	 	 
	 		(B) 	
      an Estate Account or an Other Account of the same Trust
      Company as another Person on whose account the Trust Company holds such
      security, or

	 	 	 	 
	 		(C) 	
      a Plan with the same Administrator as another Plan on
      whose account the Administrator holds such securities, or

	 	 	 	 
	 	(viii) 	
      because such Person, or any other Person acting jointly
      or in concert with such Person, is:

	 	 	 	 
	 		(A) 	
      a Client of a Manager and such security is owned at law
      or in equity by the Manager, or

	 	 	 	 
	 		(B) 	
      an Estate Account or an Other Account of a Trust Company
      and such security is owned at law or in equity by the Trust Company,
    or

	 	 	 	 
	 		(C) 	
      a Plan and such security is owned at law or in equity by
      the Administrator of the Plan, or

	 	 	 	 
	 	(ix) 	
      because such Person is the registered holder of
      securities as a result of carrying on the business of, or acting as
      nominee for, a securities depository.

For purposes of this Agreement, the
percentage of Voting Shares Beneficially Owned by any Person at any time shall
be and be deemed to be the product determined by the formula: 

	 	100 	x 	A 	 
	 	  	  	B 	 

	 	where: 	A = 	the number of votes for the election of all
      directors generally attached to the Voting Shares Beneficially Owned by
      such Person at such time; and 

- 4 - 

	 	B = 	the number of votes for the election of all
      directors generally attaching to all Voting Shares actually outstanding.
    

Where any Person is deemed to
Beneficially Own unissued Voting Shares, such Voting Shares shall be deemed to
be outstanding for the purpose of calculating the percentage of Voting Shares
Beneficially Owned by such Person, but unissued Voting Shares which another
Person may be deemed to Beneficially Own shall not be included in the
denominator of the above formula. 

	 	(f) 	
      “Board of Directors” means the board of directors
      for the time being of the Corporation.

	 	 	 
	 	(g) 	
      “Business Day” means any day other than a
      Saturday, Sunday or, unless otherwise specified, a day on which Canadian
      chartered banks in the cities of Toronto, Ontario, and Vancouver, British
      Columbia are generally authorized or obligated by law to close.

	 	 	 
	 	(h) 	
      “Business Corporations Act (British
      Columbia)” means the Business Corporations Act (BCA),
      S.B.C. 2002, c.57, as amended, and the regulations thereunder, unless
      otherwise specified, as the same exist on the date hereof.

	 	 	 
	 	(i) 	
      “Canadian-U.S. Exchange Rate” means, on any date,
      the inverse of the U.S.-Canadian Exchange Rate.

	 	 	 
	 	(j) 	
      “Canadian Dollar Equivalent” of any amount which
      is expressed in United States dollars means, on any date, the Canadian
      dollar equivalent of such amount determined by reference to the
      Canadian-U.S. Exchange Rate on such date.

	 	 	 
	 	(k) 	
      “Close of Business” on any given date means 5:00
      p.m. (Toronto time, unless otherwise specified), on such date;
      provided, however, that if such date is not a Business Day,
      “Close of Business” on such date shall mean 5:00 p.m., (Toronto
      time, unless otherwise specified), on the next succeeding Business
    Day.

	 	 	 
	 	(l) 	
      “Common Shares” means the Common Shares in the
      capital of the Corporation.

	 	 	 
	 	(m) 	
      “Competing Permitted Bid” means a Take-over Bid
      that:

	 	(i) 	
      is made after a Permitted Bid or Competing Permitted Bid
      has been made and prior to the expiry of that Permitted Bid or Competing
      Permitted Bid (in this definition, the “Prior Bid”);

	 	 	 
	 	(ii) 	
      satisfies all components of the definition of a Permitted
      Bid other than the requirements set out in clause (ii) of that definition;
      and

	 	 	 
	 	(iii) 	
      contains, and the take-up and payment for securities
      tendered or deposited thereunder are subject to, irrevocable and
      unqualified conditions that no Voting Shares shall be taken-up or paid for
      pursuant to the Competing Permitted Bid:

	 	A. 	
      prior to the Close of Business (Vancouver time) on a date
      that is not earlier than the later of 35 days after the date of such
      Competing Permitted Bid and the earliest date on which Voting Shares may
      be taken-up or paid for under any Prior Bid in existence at the date of
      such Competing Permitted Bid; and

	 	 	 
	 	B. 	
      then only if, at the time that such Voting Shares are
      first taken-up or paid for, more than 50% of the then outstanding Voting
      Shares held by Independent Shareholders have been deposited or tendered
      pursuant to the Competing Permitted Bid and not
  withdrawn.

- 5 - 

	 	(n) 	
      a body corporate is “controlled” by another Person
      if:

	 	 	 	 
	 		(i) 	
      securities entitled to vote in the election of directors
      carrying more than 50% of the votes for the election of directors are
      held, directly or indirectly, by or on behalf of the other Person;
    and

	 	 	 	 
	 		(ii) 	
      the votes carried by such securities are entitled, if
      exercised, to elect a majority of the board of directors of such body
      corporate,

	 	 	 	 
	 		
      and “controls”, “controlling” and “under
      common control with” shall be interpreted accordingly.

	 	 	 	 
	 	(o) 	
      “Convertible Securities” means at any
  time:

	 	 	 	 
	 		(i) 	
      any right (contractual or otherwise and regardless of
      whether such right constitutes a security) to acquire Voting Shares from
      the Corporation; and

	 	 	 	 
	 		(ii) 	
      any securities issued by the Corporation from time to
      time (other than the Rights) carrying any exercise, conversion or exchange
      right;

	 	 	 	 
	 		
      which is then exercisable or exercisable within a period
      of 60 days from that time pursuant to which the holder thereof may acquire
      Voting Shares or other securities convertible into or exercisable or
      exchangeable for Voting Shares (in each case, whether such right is then
      exercisable or exercisable within a period of 60 days from that time and
      whether or not on condition or the happening of any
contingency).

	 	 	 	 
	 	(p) 	
      “Convertible Security Acquisition” means the
      acquisition of Voting Shares upon the exercise of Convertible Securities
      received by a Person pursuant to a Permitted Bid Acquisition, an Exempt
      Acquisition or a Pro-Rata Acquisition.

	 	 	 	 
	 	(q) 	
      “Exchange Act of 1934” means the
      Securities Exchange Act of 1934, as amended, of the United States
      of America and the rules and regulations thereunder, unless otherwise
      specified, as the same exist on the date hereof.

	 	 	 	 
	 	(r) 	
      “Exempt Acquisition” means a Share acquisition (i)
      in respect of which the Board of Directors has waived the application of
      Section 3.1 pursuant to the provisions of Section 5.1 hereof, (ii)
      pursuant to a regular dividend reinvestment or other plan of the
      Corporation made available by it to all holders of Voting Shares of a
      class or series of Voting Shares where such plan permits the holder to
      direct that dividends paid in respect of such Voting Shares be applied to
      the purchase from the Corporation of further securities of the
      Corporation, or (iii) by a Person pursuant to a prospectus or by way of
      private placement, provided that the Person does not thereby acquire a
      greater percentage of Voting Shares, or securities convertible into or
      exchangeable for Voting Shares, than the Person’s percentage of Voting
      Shares Beneficially Owned immediately prior to such acquisition.

	 	 	 	 
	 	(s) 	
      “Exercise Price” means, as of any date, the price
      at which a holder may purchase the securities issuable upon exercise of
      one whole Right. Until adjustment thereof in accordance with the terms
      hereof, the Exercise Price shall equal $40.

	 	 	 	 
	 	(t) 	
      “Expiration Time” means the earliest of: (i) the
      Termination Time; (ii) the termination of the annual meeting of the
      Corporation in the year 2010 unless at such meeting the duration of this
      Agreement is extended; and (iii) 180 days after the date of this Rights
      Plan if this Rights Plan is not ratified by holders of Voting Shares in
      accordance with the requirements of the Toronto Stock
  Exchange.

- 6 - 

	 	(u) 	
      “Flip-in Event” means a transaction or event that
      results in a Person becoming an Acquiring Person.

	 	 	 	 
	 	(v) 	
      “Fiduciary” means a trust company registered under
      the laws of Canada or any province thereof or a portfolio manager
      registered under the securities legislation of one or more provinces of
      Canada.

	 	 	 	 
	 	(w) 	
      “Independent Shareholders” means all holders of
      Common Shares other than (i) any Acquiring Person, (ii) any Offeror, (iii)
      any Affiliate or Associate of any Acquiring Person or Offeror, (iv) any
      Person acting jointly or in concert with any Person referred to in clauses
      (i) or (ii) , and (v) any employee benefit plan, deferred profit sharing
      plan, stock participation plan or trust for the benefit of employees of
      the Corporation or a wholly-owned Subsidiary of the Corporation, unless
      the beneficiaries of such plan or trust direct the manner in which such
      Common Shares are to be voted or direct whether the Common Shares are to
      be tendered to a Take-over Bid.

	 	 	 	 
	 	(x) 	
      “Market Price” per security of any securities on
      any date means the average of the daily closing prices per security of
      such securities (determined as described below) on each of the 20
      consecutive Trading Days through and including the Trading Day immediately
      preceding such date.; provided, however, that if an event of a type
      analogous to any of the events described in Section 2.3 hereof shall have
      caused the closing prices used to determine the Market Price on any
      Trading Days not to be fully comparable with the closing price on such
      date (or, if such date is not a Trading Day, on the immediately preceding
      Trading Day), each such closing price so used shall be appropriately
      adjusted in a manner analogous to the applicable adjustment provided for
      in Section 2.3 hereof in order to make it fully comparable with the
      closing price on such date (or, if such date is not a Trading Day, on the
      immediately preceding Trading Day). The closing price per security of any
      securities on any date shall be:

	 	 	 	 
	 		(i) 	
      the closing board lot sale price or, in the case no such
      sale takes place on such date, the average of the closing bid and asked
      prices for each share of such securities as reported by the principal
      stock exchange in Canada on which such shares are listed or posted for
      trading;

	 	 	 	 
	 		(ii)	
      if such shares are not listed or posted for trading on
      any stock exchange in Canada, the last sale price, regular way, or, in
      case no such sale takes place on such date, the average of the closing bid
      and asked prices, regular way, for each share of such securities as
      reported in the principal consolidated transaction reporting system with
      respect to securities listed or admitted to trading on the principal
      national securities exchange in the United States on which such shares are
      listed or admitted to trading, or

	 	 	 	 
	 		(iii)	
      if for any reason none of such prices is available on
      such day or the securities are not listed or admitted to trading on a
      stock exchange in Canada or a national securities exchange in the United
      States, the last quoted price, or if not so quoted, the average of the
      high bid and low asked prices for each share of such securities in the
      over-the-counter market, as reported by the National Association of
      Securities Dealers, Inc. Automated Quotation System (“NASDAQ”) or
      such other system then in use; or

	 	 	 	 
	 		(iv)	
      if on any such date such shares are not quoted by any
      such organization, the average of the closing bid and asked prices as
      furnished by a professional market maker making a market in such shares
      selected by the Board of Directors of the Corporation; provided, however,
      that if on any such date such shares are not traded in the
      over-the-counter market, the closing price per share of such securities on
      such date shall mean the fair value per share of such securities on such
      date as determined by a nationally or internationally recognized
      investment dealer or investment banker. The Market Price shall be
      expressed in Canadian dollars and if initially determined in respect of
      any day forming part of the 20 consecutive Trading Day period in question
      in United States

- 7 - 

	 			dollars, such amount shall be translated into Canadian
      dollars at the Canadian Dollar Equivalent thereof on the relevant Trading
      Day.
	 	 	 	 
	 	(y) 	
      “Offer to Acquire” includes:

	 	 	 	 
	 		(i) 	
      an offer to purchase, or a solicitation of an offer to
      sell, Common Shares (including an offer commenced by public announcement
      or advertisement);

	 	 	 	 
	 		(ii) 	
      an acceptance of an offer to sell Common Shares, whether
      or not such offer to sell has been solicited;

	 	 	 	 
	 		
      or any combination thereof, and the Person accepting an
      offer to sell shall be deemed to be making an Offer to Acquire to the
      Person that made the offer to sell.

	 	 	 	 
	 	(z) 	
      “Offeror” means a Person who is making or has
      announced a current intention to make a Take- over Bid (including a
      Permitted Bid or Competing Permitted Bid but excluding any person referred
      to in paragraph (vi) of the definition of Beneficial Owner) but only so
      long as the Take- over Bid so announced or made has not been withdrawn or
      terminated or has not expired.

	 	 	 	 
	 	(aa) 	
      “Permitted Bid” means a Take-over Bid which is
      made by means of a Take-over Bid circular and which also complies with the
      following additional provisions:

	 	 	 	 
	 		(i) 	
      the Take-over Bid shall be made to all holders of Voting
      Shares as registered on the books of the Corporation, other than the
      Offeror;

	 	 	 	 
	 		(ii) 	
      the Take-over Bid shall contain, and the take-up and
      payment for securities tendered or deposited thereunder shall be subject
      to, an irrevocable and unqualified condition that no Voting Shares shall
      be taken up or paid for pursuant to the Take-over Bid prior to the Close
      of Business (Vancouver time) on a date which is not less than 60 days
      after the date of the Take-over Bid and only if at such date more than 50%
      of the Voting Shares held by Independent Shareholders shall have been
      deposited or tendered pursuant to the Take-over Bid and not
    withdrawn;

	 	 	 	 
	 		(iii) 	
      the Take-over Bid contains an irrevocable and unqualified
      provision that, unless the Take-over Bid is withdrawn, Voting Shares may
      be deposited pursuant to such Take-over Bid at any time during the period
      of time between the date of the Take-over Bid and the date on which Voting
      Shares may be taken up and paid for and that any Voting Shares deposited
      pursuant to the Take-over Bid may be withdrawn until taken up and paid
      for; and

	 	 	 	 
	 		(iv) 	
      the Take-over Bid contains an irrevocable and unqualified
      provision that if, on the date on which Voting Shares may be taken up and
      paid for, more than 50% of the Voting Shares held by Independent
      Shareholders shall have been deposited or tendered pursuant to the
      Take-over Bid and not withdrawn, the Offeror will make a public
      announcement of that fact and the Take-over Bid will remain open for
      deposits and tenders of Voting Shares for not less than 10 Business Days
      from the date of such public announcement.

	 	 	 	 
	 	(bb) 	
      “Permitted Bid Acquisition” means a Share
      acquisition made pursuant to a Permitted Bid or Competing Permitted
      Bid.

	 	 	 	 
	 	(cc) 	
      “Permitted Lock-Up Agreement” means an agreement
      (the “Lock-up Agreement”) between a Person and one or more holders
      of Voting Shares (each holder referred to herein as a “Locked-up
      Person”), the terms of which are publicly disclosed and a copy of
      which is made available to the public, including the Corporation, pursuant
      to which such holders agree to deposit or tender Voting Shares to a
      Take-over Bid (the “Lock-up Bid”) made by the Person or any of
      such

- 8 - 

Person’s Affiliates or Associates or
any other Person referred to in clause (iii) of the definition of Beneficial
Owner, whether such Lock-up Bid is made before or after the Lock-up Agreement is
signed, provided that: 

	 	(i) 	
      the Lock-up Agreement permits the Locked-up Person to
      terminate its agreement to deposit or tender to or to not withdraw Voting
      Shares from the Lock-up Bid in the event a “Superior Offer” is made
      to the Locked-up Person. For purposes of this subsection, a “Superior
      Offer” is any Take-over Bid, amalgamation, arrangement or similar
      transaction pursuant to which the cash equivalent value of the
      consideration per share to be received by holders of the Voting Shares
      under such transaction (the “Superior Offer Consideration”) is
      greater than the cash equivalent value per share to be received by holders
      of Voting Shares under the Lock-up Bid (the “Lock-up Bid
      Consideration”). Notwithstanding the foregoing, the Lock-up Agreement
      may require that the Superior Offer Consideration must exceed the Lock-up
      Bid Consideration by a specified percentage before such termination rights
      take effect, provided such specified percentage is not greater than
    7%.

For greater clarity, the Lock-up
Agreement may contain a right of first refusal or require a period of delay to
give the Person who made the Lock-up Bid an opportunity to match a higher price
in another Take-over Bid or transaction or similar limitation on the Locked-up
Person’s right to withdraw Voting Shares from the agreement, so long as the
limitation does not preclude the exercise by the Locked-up Person of the right
to withdraw Voting Shares during the period of the other Take-over Bid or
transaction; and 

	 	(ii) 	
      no “break-up” fees, “top-up” fees,
      penalties, expenses, or other amounts that exceed, in the aggregate, the
      greater of:

	 	 	 	 
	 		A. 	
      2.5% of the Lock-up Bid Consideration payable under the
      Lock-up Agreement to the Locked-up Person; and

	 	 	 	 
	 		B. 	
      one-half of the difference between the Superior Offer
      Consideration payable to the Locked-up Person and the Lock-up Bid
      Consideration the Locked-up Person would have received under the Lock-up
      Bid,

	 	 	 	 
	 		
      shall be payable pursuant to the Lock-up Agreement in the
      event that the Locked-up Person fails to tender Voting Shares pursuant to
      the Lock-up Bid or withdraws Voting Shares from the Lock-Up Bid in order
      to accept the other Take-over Bid or
transaction.

	 	(dd) 	
      “Person” includes any individual, firm,
      partnership, association, trust, body corporate, joint venture, syndicate
      or other form of unincorporated organization, government and its agencies
      and instrumentalities or other entity or group (whether or not having
      legal personality) and any successor (by merger, statutory amalgamation or
      arrangement, or otherwise) thereof.

	 	 	 
	 	(ee) 	
      “Pro-Rata Acquisition” means the acquisition of
      Voting Shares or securities convertible into or exchangeable for Voting
      Shares (i) as a result of a stock dividend, stock split or other event
      pursuant to which a Person receives or acquires Voting Shares or
      securities convertible into or exchangeable for Voting Shares on the same
      pro-rata basis as all other holders of Voting Shares of the same class or
      series, or (ii) pursuant to the receipt and/or exercise of rights issued
      by the Corporation on a pro-rata basis to all holders of a class or series
      of Voting Shares to subscribe for or purchase Voting Shares or securities
      convertible into or exchangeable for Voting Shares provided that such
      rights are acquired directly from the Corporation and not from any other
      Person, provided that the Person acquiring such Voting Shares does not
      thereby acquire a greater percentage of such Voting Shares, or securities
      convertible into or exchangeable for such Voting Shares, than the Person’s
      percentage of Voting Shares Beneficially Owned immediately prior to such
      acquisition.

- 9 - 

	 	(ff) 	
      “Record Time” means the close of business on
      February 13, 2007.

	 	 	 	 
	 	(gg) 	
      “Redemption Price” has the meaning ascribed to
      that term in subsection 5.1(a) hereof.

	 	 	 	 
	 	(hh) 	
      “Regular Periodic Cash Dividends” means cash
      dividends paid at regular intervals in any fiscal year of the Corporation
      to the extent that such cash dividends do not exceed, in the aggregate,
      the greatest of:

	 	 	 	 
	 		(i) 	
      200% of the aggregate amount of cash dividends declared
      payable by the Corporation on its Common Shares in its immediately
      preceding fiscal year;

	 	 	 	 
	 		(ii) 	
      300% of the arithmetic mean of the aggregate amounts of
      cash dividends declared payable by the Corporation on its Common Shares in
      its three immediately preceding fiscal years; and

	 	 	 	 
	 		(iii) 	
      100% of the aggregate consolidated net income of the
      Corporation, before extraordinary items, for its immediately preceding
      fiscal year.

	 	 	 	 
	 	(ii) 	
      “Rights Certificate” has the meaning ascribed to
      that term in subsection 2.2(c) hereof.

	 	 	 	 
	 	(jj) 	
      “Rights Holders’ Special Meeting” means a meeting
      of the holders of Rights called by the Board of Directors and conducted in
      accordance with the terms hereof.

	 	 	 	 
	 	(kk) 	
      “Securities Act of 1933” means the
      Securities Act of 1933, as amended, of the United States of America
      and the rules and regulations thereunder, unless otherwise specified, as
      the same exist on the date hereof.

	 	 	 	 
	 	(ll) 	
      “Securities Act (British Columbia)”
      means the Securities Act, R.S.B.C. 1996, Chapter 418, as amended,
      and the regulations and rules thereunder, unless otherwise specified, as
      the same exist on the date hereof.

	 	 	 	 
	 	(mm) 	
      “Separation Time” means the Close of Business
      (Vancouver time) on the tenth Trading Day after the earliest of:

	 	 	 	 
	 		(i) 	
      the Stock Acquisition Date;

	 	 	 	 
	 		(ii) 	
      the date of the commencement of, or first public
      announcement of the intent of any Person (other than the Corporation or
      any Subsidiary of the Corporation) to commence, a Take-over Bid (other
      than a Permitted Bid or a Competing Permitted Bid, as the case may be);
      and

	 	 	 	 
	 		(iii) 	
      the date upon which a Permitted Bid or Competing
      Permitted Bid ceases to be such;

	 	 	 	 
	 		
      or such later date as may be determined by the Board of
      Directors provided, however, that if any such Take-over Bid expires, is
      cancelled, terminated or otherwise withdrawn prior to the Separation Time,
      such Take-over Bid shall be deemed, for purposes of this definition, never
      to have been made.

	 	 	 	 
	 	(nn) 	
      “Shares” means the shares in the capital of the
      Corporation.

	 	 	 	 
	 	(oo) 	
      “Stock Acquisition Date” means the first date of
      public announcement (which, for purposes of this definition, shall
      include, without limitation, a report filed pursuant to Section 111 of the
      Securities Act (British Columbia) or Section 13(d) under the
      Exchange Act of 1934, as amended from time to time and any
      provision substituted therefor) by the Corporation or an Acquiring Person
      of facts indicating that an Acquiring Person has become
  such.

- 10 - 

	 	(pp) 	
      “Subsidiary”:

	 	 	 	 
	 		A body corporate is a Subsidiary of another body
      corporate if:
	 	 	 	 
	 		(i)	
      it is controlled by (A) that other, or (B) that other and
      one or more bodies corporate, each of which is controlled by that other,
      or (C) two or more bodies corporate, each of which is controlled by that
      other, or

	 	 	 	 
	 	 	 (ii)	 it is a Subsidiary of a body corporate that is
      that other’s Subsidiary.
	 	 	 	 
	 	(qq) 	
      “Take-over Bid” means an Offer to Acquire Voting
      Shares or securities convertible into Voting Shares, where the Voting
      Shares subject to the Offer to Acquire, together with the Voting Shares,
      if any, into which the securities subject to the Offer to Acquire are
      convertible and the Voting Shares Beneficially Owned by the Offeror at the
      date of the Offer to Acquire constitute, in the aggregate, 20% or more of
      the then outstanding Voting Shares.

	 	 	 	 
	 	(rr) 	
      “Termination Time” means the time at which the
      right to exercise Rights shall terminate pursuant to Section 5.1
      hereof.

	 	 	 	 
	 	(ss) 	
      “Trading Day”, when used with respect to any
      securities, means a day on which the principal securities exchange in
      Canada on which such securities are listed or admitted to trading is open
      for the transaction of business or, if the securities are not listed or
      admitted to trading on any securities exchange in Canada, a day on which
      the principal securities exchange in the United States of America on which
      such securities are listed or admitted to trading is open for the
      transaction of business, or if the securities are not listed or admitted
      to trading on any securities exchange in Canada or the United States of
      America, a Business Day.

	 	 	 	 
	 	(tt) 	
      “U.S.-Canadian Exchange Rate” means, on any
      date:

	 	 	 	 
	 		(i)	
      if on such date the Bank of Canada sets an average noon
      spot rate of exchange for the conversion of one United States dollar into
      Canadian dollars, such rate; and

	 	 	 	 
	 		(ii) 	
      in any other case, the rate for such date for the
      conversion of one United States dollar into Canadian dollars calculated in
      the manner which shall be determined by the Board of Directors from time
      to time.

	 	 	 	 
	 	(uu) 	
      “U.S. Dollar Equivalent” of any amount which is
      expressed in Canadian dollars means, on any date, the United States dollar
      equivalent of such amount determined by reference to the U.S.- Canadian
      Exchange Rate on such date.

	 	 	 	 
	 	(vv) 	
      “Voting Share Reduction” means an acquisition or a
      redemption by the Corporation of Voting Shares.

	 	 	 	 
	 	(ww) 	
      “Voting Shares” means, collectively, the Common
      Shares and any other Shares entitled to vote generally for the election of
      directors.

	1.2 	Holder 

                    As
  used in this Agreement, unless the context otherwise requires, the “holder”
  when used with reference to Rights, means the registered holder of such Rights
  or, prior to the Separation Time, the associated Common Shares. 

- 11 - 

	1.3 	Acting Jointly or in Concert
  

                    For
  purposes of this Agreement, a Person is acting jointly or in concert with every
  other person who is a party to any agreement, to acquire or offer to acquire
  Voting Shares (other than customary agreements with and between underwriters
  and banking group or selling group members with respect to the distribution
  of securities pursuant to a prospectus or by way of private placement and other
  than pursuant to pledges of securities in the ordinary course of business).

	1.4 	Application of Statutes, Regulations and
      Rules 

                    Where
  a statute, regulation or rule is referred to in a definition or other provision
  of this Agreement, it shall be conclusively deemed to have application in the
  contemplated circumstances notwithstanding that such statute, regulation or
  rule might not, but for the provisions of this Section 1.4, have application
  for want of jurisdiction or otherwise. 

	1.5 	Currency 

                    All
  sums of money which are referred to in this Agreement are expressed in lawful
  money of Canada, unless otherwise specified. 

	1.6 	Headings and References

                    The
  headings of the Articles and Sections of this Agreement and the Table of Contents
  are inserted for convenience and reference only and shall not affect the construction
  or interpretation of this Agreement. All references to Articles, Sections and
  Exhibits are to articles and sections of and exhibits to, and forming part of,
  this Agreement. The words “hereto”, “herein”,
  “hereof”, “hereunder”, “this Agreement”,
  “the Rights Agreement” and similar expressions refer to this
  Agreement including the Exhibits, as the same may be amended, modified or supplemented
  at any time or from time to time. 

	1.7 	Singular, Plural, etc.

                    In
  this Agreement, where the context so admits, words importing the singular number
  include the plural and vice versa and words importing gender include the masculine,
  feminine and neuter genders. 

ARTICLE 2 - THE RIGHTS 

	2.1 	Legend on Common Share Certificates
  

                    Certificates
  for Common Shares issued after the Record Time hereof but prior to the Separation
  Time shall evidence one Right for each Common Share represented thereby and
  shall have impressed, printed, or written thereon or otherwise affixed thereto
  a legend in substantially the following form: 

	 	
      “Until the Separation Time (as such term is defined in
      the Rights Agreement referred to below), this certificate also evidences
      and entitles the holder hereof to certain Rights as set forth in a Rights
      Agreement dated effective as of December 11, 2006 (the “Rights
      Agreement”), between Taseko Mines Limited (the “Corporation”) and
      Computershare Investor Services Inc., as Rights Agent, the terms of which
      are hereby incorporated herein by reference and a copy of which is on file
      and may be inspected during normal business hours at the principal
      executive offices of the Corporation. Under certain circumstances, as set
      forth in the Rights Agreement, such Rights may be amended or redeemed, may
      expire, may become void (if, in certain circumstances, they are
      “Beneficially Owned” by a “Person” who is or becomes an “Acquiring Person”
      or any Person acting jointly or in concert with an Acquiring Person or
      with an “Affiliate” or “Associate” of an “Acquiring Person”, as such terms
      are defined in the Rights Agreement, or a transferee thereof) or may be
      evidenced by separate certificates and may no longer be evidenced by this
      certificate. 
	 

- 12 - 

	 	
      The Corporation will mail or arrange for the mailing of a
      copy of the Rights Agreement to the holder of this certificate without
      charge within five days after the receipt of a written request therefor.”
      
	 

Certificates representing Common Shares that are issued and
outstanding at the Record Time shall evidence one Right for each Common Share
evidenced thereby notwithstanding the absence of a legend in substantially the
foregoing form until the earlier of the Separation Time and the Expiration Time.

	2.2 	Initial Exercise Price: Exercise of Rights:
      Detachment of Rights 

	 	(a) 	
      Subject to adjustment as herein set forth, each Right
      will entitle the holder thereof, after the Separation Time and prior to
      the Expiration Time, to purchase, for the Exercise Price, one Common
      Share. Notwithstanding any other provision of this Agreement, any Rights
      held by the Corporation or any of its Subsidiaries shall be
void.

	 	 	 	 
	 	(b) 	
      Until the Separation Time,

	 	 	 	 
	 		(i) 	
      the Rights shall not be exercisable and no Right may be
      exercised, and

	 	 	 	 
	 		(ii) 	
      for administrative purposes, each Right shall be
      evidenced by the certificate for the associated Common Share registered in
      the name of the holder thereof (which certificate shall be deemed to
      represent a Rights Certificate) and shall be transferable only together
      with, and shall be transferred by a transfer of, such associated Common
      Share.

	 	 	 	 
	 	(c) 	
      After the Separation Time and prior to the Expiration
      Time, the Rights (i) may be exercised and (ii) shall be registered and
      transferable independent of Common Shares. Promptly following the
      Separation Time, the Corporation shall prepare and the Rights Agent shall
      mail to each holder of record of Common Shares as of the Separation Time
      (other than an Acquiring Person, any other Person whose Rights are or
      become void pursuant to the provisions of subsection 3.1(b) hereof and, in
      respect of any Rights Beneficially Owned by such Acquiring Person which
      are not held of record by such Acquiring Person, the holder of record of
      such Rights), at such holder’s address as shown in the records of the
      Corporation (the Corporation hereby agreeing to furnish copies of such
      records to the Rights Agent for this purpose),

	 		
	 		(i) 	
      a certificate (a “Rights Certificate”) in
      substantially the form of Exhibit A hereto appropriately completed and
      registered in such holder’s name, representing the number of Rights held
      by such holder at the Separation Time and having such marks of
      identification or designation and such legends, summaries or endorsements
      printed thereon as the Corporation may deem appropriate and as are not
      inconsistent with the provisions of this Agreement, or as may be required
      to comply with any applicable law or with any rule or regulation made
      pursuant thereto or with any rule or regulation of any stock exchange or
      quotation system on which the Rights may from time to time be listed or
      traded, or to conform to usage, and

	 	 	 	 
	 		(ii) 	
      a disclosure statement describing the Rights.

	 	 	 	 
	 	(d) 	
      Rights may be exercised in whole at any time or in part
      from time to time on any Business Day (or other day that is not a bank
      holiday at the place of exercise) after the Separation Time and prior to
      the Expiration Time by submitting to the Rights Agent at its office in the
      City of Vancouver, Canada or at any other office of the Rights Agent or
      any Co-Rights Agent in the cities specified in the Rights Certificate or
      designated from time to time for that purpose by the Corporation after
      consultation with the Rights Agent:

	 	 	 	 
	 		(i) 	
      the Rights Certificate evidencing such Rights with an
      Election to Exercise (an “Election to Exercise”) substantially in
      the form attached to the Rights Certificate,
  appropriately

- 13 - 

	 		  
	completed and duly executed by the holder or his
        executors or administrators or other personal representatives or his legal
        attorney duly appointed by instrument in writing in form and executed
        in a manner satisfactory to the Rights Agent, and

	 	 	 	 
	 		(ii) 	 payment by certified cheque or money order payable to
        the order of the Corporation, of a sum equal to the Exercise Price multiplied
        by the number of Rights being exercised and a sum sufficient to cover
        any transfer tax or charge which may be payable in respect of any transfer
        involved in the issuance, transfer or delivery of Rights Certificates
        or the issuance, transfer or delivery of certificates for Common Shares
        in a name other than that of the holder of the Rights being exercised.

	 	 	 	 
	 	(e) 	 Upon receipt of a Rights Certificate accompanied
        by a duly completed and executed Election to Exercise which does not indicate
        that Rights evidenced by such Rights Certificate have become void pursuant
        to subsection 3.1(b) hereof and payment as set forth in subsection 2.2(d)
        above, the Rights Agent (unless otherwise instructed by the Corporation)
        shall thereupon promptly:

	 	 	 	 
	 		(i) 	 requisition from a transfer agent of the Common Shares
        certificates for the number of Common Shares to be purchased (the Corporation
        hereby irrevocably authorizing its transfer agents to comply with all
        such requisitions),

	 	 	 	 
	 		(ii) 	 when appropriate, requisition from the Corporation the
        amount of cash to be paid in lieu of issuing fractional Common Shares,

	 	 	 	 
	 		(iii) 	 after receipt of such certificates, deliver the same
        to or upon the order of the registered holder of such Rights Certificate,
        registered in such name or names as may be designated by such holder together
        with, where applicable, any cash payment in lieu of a fractional interest,
        and

	 	 	 	 
	 		(iv) 	 tender to the Corporation all payments received on exercise
        of the Rights.

	 	 	 	 
	 	(f) 	 In case the holder of any Rights shall exercise
        less than all the Rights evidenced by such holder’s Rights Certificate,
        a new Rights Certificate evidencing (subject to the provisions of subsection
        5.5(a) hereof) the Rights remaining unexercised will be issued by the
        Rights Agent to such holder or to such holder’s duly authorized assigns.

	 	 	 	 
	 	(g) 	 The Corporation covenants and agrees to:

	 	 	 	 
	 		(i) 	 take all such action as may be necessary on its part
        and within its powers to ensure that all Shares delivered upon exercise
        of Rights shall, at the time of delivery of the certificates evidencing
        such Shares (subject to payment of the Exercise Price), be duly and validly
        authorized, executed, issued and delivered and be fully paid and non-
        assessable;

	 	 	 	 
	 		(ii) 	 take all reasonable action as may be necessary on its
        part and within its power to comply with any applicable requirements of
        the Business Corporations Act (British Columbia), the Securities
        Acts or comparable legislation of each of the provinces and territories
        of Canada and the Securities Act of 1933, and the rules and regulations
        thereunder, and any other applicable law, rule or regulation, in connection
        with the issuance and delivery of Rights Certificates and of any securities
        of the Corporation upon exercise of Rights;

	 	 	 	 
	 		(iii) 	 use its reasonable efforts to cause all Shares of the
        Corporation issued upon exercise of Rights to be listed on the stock exchanges
        on which such Common Shares were traded immediately before the Stock Acquisition
        Date; and

- 14 - 

	 	(iv) 	
      pay when due and payable any and all Canadian and United
      States federal, provincial and state transfer taxes (not including any
      taxes referable to the income or profit of the holder or exercising Person
      or any liability of the Corporation to withhold tax) and charges which may
      be payable in respect of the original issuance or delivery of the Rights
      Certificates or of any Shares of the Corporation issued upon the exercise
      of Rights, provided that the Corporation shall not be required to pay any
      transfer tax or charge - which may be payable in respect of any transfer
      involved in the transfer or delivery of Rights Certificates or the
      issuance or delivery of certificates for securities in a name other than
      that of the holder of the Rights being transferred or
  exercised.

	2.3 	Adjustments to Exercise Price, Number of
      Rights 

                    Subject
  to subsection 5.17, the Exercise Price, the number and kind of securities subject
  to purchase upon exercise of each Right and the number of Rights outstanding
  are subject to adjustment from time to time as provided in this Section 2.3.

	 	(a) 	
      If the Corporation shall at any time after the Record
      Time and prior to the Expiration Time:

	 	 	 	 
	 		(i) 	
      declare or pay a dividend on Common Shares payable in
      Common Shares (or other Shares of capital or securities exchangeable for
      or convertible into or giving a right to acquire Common Shares or other
      Shares of capital) otherwise than pursuant to any optional share dividend
      program;

	 	 	 	 
	 		(ii) 	
      subdivide or change the outstanding Common Shares into a
      greater number of Common Shares,

	 	 	 	 
	 		(iii) 	
      consolidate or change the outstanding Common Shares into
      a smaller number of Common Shares, or

	 	 	 	 
	 		(iv) 	
      issue any Common Shares (or other shares of capital or
      securities exchangeable for or convertible into or giving a right to
      acquire Common Shares or other Shares of capital) in respect of, in lieu
      of, or in exchange for, existing Common Shares in a reclassification or
      redesignation of Common Shares, an amalgamation or statutory
      arrangement,

the Exercise Price and the number of Rights outstanding, or, if
the payment or effective date therefor shall occur after the Separation Time,
the securities purchasable upon exercise of Rights shall be adjusted in the
manner set forth below. If an event occurs which would require an adjustment
under both this Section 2.3 and subsection 3.1(a), the adjustment provided for
in this Section 2.3 shall be in addition to, and shall be made prior to, any
adjustment required under subsection 3.1(a) . If the Exercise Price and number
of Rights are to be adjusted, 

	 	(x) 	
      the Exercise Price in effect after such adjustment shall
      be equal to the Exercise Price in effect immediately prior to such
      adjustment divided by the number of Common Shares (or other Shares of
      capital) (the “Expansion Factor”) that a holder of one Common Share
      immediately prior to such dividend, subdivision, change, consolidation or
      issuance would hold immediately thereafter as a result thereof (assuming
      the exercise of all such exchange or conversion rights, if any),
  and

	 	 	 
	 	(y) 	
      each Right held prior to such adjustment shall become
      that number of Rights equal to the Expansion
Factor,

and the adjusted number of Rights shall be deemed to be
distributed among the Common Shares with respect to which the original Rights
were associated (if they remain outstanding) and the Shares issued in respect of
such dividend, subdivision, change, consolidation or issuance, so that each such
Common Share (or other whole Share or security exchangeable for or convertible
into a whole Share of capital) shall have exactly one Right associated with it.

- 15 - 

                    If
  the securities purchasable upon exercise of Rights are to be adjusted, the securities
  purchasable upon exercise of each Right after such adjustment shall be the securities
  that a holder of the securities purchasable upon exercise of one Right immediately
  prior to such dividend, subdivision, change, consolidation or issuance would
  hold immediately thereafter as a result thereof. To the extent that any such
  rights of exchange, conversion or acquisition are not exercised prior to the
  expiration thereof, the Exercise Price shall be readjusted to the Exercise Price
  which would then be in effect based upon the number of Common Shares (or securities
  convertible into or exchangeable for Common Shares) actually issued upon the
  exercise of such rights. If after the Record Time and prior to the Expiration
  Time the Corporation shall issue any shares of its authorized capital other
  than Common Shares in a transaction of a type described in the first sentence
  of this subsection 2.3(a), such shares shall be treated herein as nearly equivalent
  to Common Shares as may be practicable and appropriate under the circumstances
  and the Corporation and the Rights Agent agree to amend this Agreement in order
  to effect such treatment. 

                    If
  the Corporation shall at any time after the Record Time and prior to the Separation
  Time issue any Common Shares otherwise than in a transaction referred to in
  the preceding paragraph, each such Common Share so issued shall automatically
  have one new Right associated with it, which Right shall be evidenced by the
  certificate representing such Share. 

          (b)    
   If the Corporation shall at any time after the Record Time and prior to
  the Separation Time fix a record date for the making of a distribution to all
  holders of Common Shares of rights or warrants entitling them (for a period
  expiring within 45 days after such record date) to subscribe for or purchase
  Common Shares (or securities convertible into or exchangeable for or carrying
  a right to purchase or subscribe for Common Shares) at a price per Common Share
  (or, in the case of a security convertible into or exchangeable for or carrying
  a right to purchase or subscribe for Common Shares, having a conversion, exchange
  or exercise price (including the price required to be paid to purchase such
  convertible or exchangeable security or right) per share) that is less than
  90% of the Market Price per Common Share on such record date, the Exercise Price
  shall be adjusted. The Exercise Price in effect after such record date shall
  equal the Exercise Price in effect immediately prior to such record date multiplied
  by a fraction, of which the numerator shall be the number of Common Shares outstanding
  on such record date plus the number of Common Shares which the aggregate offering
  price of the total number of Common Shares so to be offered (and/or the aggregate
  initial conversion, exchange or exercise price of the convertible or exchangeable
  securities or rights so to be offered (including the price required to be paid
  to purchase such convertible or exchangeable securities or rights)) would purchase
  at such Market Price and of which the denominator shall be the number of shares
  of Common Shares outstanding on such record date plus the number of additional
  Common Shares to be offered for subscription or purchase (or into which the
  convertible or exchangeable securities or rights so to be offered are initially
  convertible, exchangeable or exercisable). In case such subscription price may
  be paid in a consideration part or all of which shall be in a form other than
  cash, the value of such consideration shall be as determined by the Board of
  Directors. To the extent that any such rights or warrants are not so issued
  or, if issued, are not exercised prior to the expiration thereof, the Exercise
  Price shall be readjusted to the Exercise Price which would then be in effect
  if such record date had not been fixed or to the Exercise Price which would
  then be in effect based upon the number of Common Shares (or securities convertible
  into or exchangeable for Common Shares) actually issued upon the exercise of
  such rights or warrants, as the case may be. For purposes of this Agreement,
  the granting of the right to purchase Common Shares (whether previously unissued,
  treasury shares or otherwise) pursuant to any optional dividend reinvestment
  plan and/or any Common Share purchase plan providing for the reinvestment of
  dividends payable on securities of the Corporation and/or employee stock option,
  stock purchase or other employee benefit plan (so long as such right to purchase
  is in no case evidenced by the delivery of rights or warrants) shall not be
  deemed to constitute an issue of rights or warrants by the Corporation; provided,
  however, that, in the case of any dividend reinvestment plan, the right
  to purchase Common Shares is at a price per share of not less than 90% of the
  then current market price per share (determined as provided in such plan) of
  the Common Shares. 

          (c)    
   If the Corporation shall at any time after the Record Time and prior to
  the Separation Time fix a record date for the making of a distribution to all
  holders of Common Shares of evidences of indebtedness or assets (other than
  a Regular Periodic Cash Dividend or a dividend paid in Common Shares) or rights
  or warrants (excluding those referred to in subsection 2.3(a) or 2.3(b)), the
  Exercise Price shall be adjusted. The Exercise Price in effect after such record
  date shall, subject to adjustment as provided in the penultimate sentence of
  subsection 2.3(b), equal the Exercise Price in effect immediately prior to such
  record date less the fair market value of the 

- 16 - 

portion of the assets, evidences of indebtedness, rights or
warrants so to be distributed applicable to the securities purchasable upon
exercise of one Right. 

	 	(d) 	
      Each adjustment made pursuant to this Section 2.3 shall
      be made as of:

	 	 	 	 
	 		(i) 	
      the payment or effective date for the applicable
      dividend, subdivision, change, consolidation or issuance in the case of an
      adjustment made pursuant to subsection 2.3(a) above, and

	 	 	 	 
	 		(ii) 	
      the record date for the applicable dividend or
      distribution, in the case of an adjustment made pursuant to subsections
      2.3(b) or (c) above.

          (e)     
  Anything herein to the contrary notwithstanding, no adjustment to the Exercise
  Price shall be required unless such adjustment would require an increase or
  decrease of at least 1% in such Exercise Price; provided, however, that
  any adjustments which by reason of this subsection 2.3(e) are not required to
  be made shall be carried forward and taken into account in any subsequent adjustment.
  Each adjustment made pursuant to this Section 2.3 shall be calculated to the
  nearest cent or to the nearest one ten-thousandth of a Common Share or Right,
  as the case may be.

          (f)    
   All Rights originally issued by the Corporation subsequent to any adjustment
  made to an Exercise Price hereunder shall evidence the right to purchase, at
  the adjusted Exercise Price, the number of Common Shares purchasable from time
  to time hereunder upon exercise of the Rights, all subject to further adjustment
  as provided herein. 

          (g)     
  Unless the Corporation shall have exercised its election as provided in subsection
  2.3(h), upon each adjustment of an Exercise Price as a result of the calculations
  made in subsections 2.3(b) and (c), each Right outstanding immediately prior
  to the making of such adjustment shall thereafter evidence the right to purchase,
  at the adjusted Exercise Price, that number of Common Shares (calculated to
  the nearest one ten-thousandth) obtained by: 

	 	(i) 	
      multiplying (A) the number of Common Shares covered by a
      Right immediately prior to this adjustment, by (B) the Exercise Price in
      effect immediately prior to such adjustment of the Exercise Price;
    and

	 	 	 
	 	(ii) 	
      dividing the product so obtained by the Exercise Price in
      effect immediately after such adjustment of the Exercise
  Price.

          (h)     
  The Corporation may elect on or after the date of any adjustment of an Exercise
  Price to adjust the number of Rights, in lieu of any adjustment in the number
  of Common Shares purchasable upon the exercise of a Right. Each of the Rights
  outstanding after the adjustment in the number of Rights shall be exercisable
  for the number of Common Shares for which a Right was exercisable immediately
  prior to such adjustment. Each Right held of record immediately prior to such
  adjustment of the number of Rights shall become the number of Rights (calculated
  to the nearest one ten-thousandth) obtained by dividing the Exercise Price in
  effect immediately prior to the adjustment of the Exercise Price by the Exercise
  Price in effect immediately after adjustment of the Exercise Price. The Corporation
  shall make a public announcement of its election to adjust the number of Rights,
  indicating the record date for the adjustment and, if known at the time, the
  amount of the adjustment to be made. This record date may be the date on which
  the Exercise Price is adjusted or any date thereafter, but, if the Rights Certificates
  have been issued, shall be at least 10 calendar days after the date of the public
  announcement. If Rights Certificates have been issued, upon each adjustment
  of the number of Rights pursuant to this subsection 2.3(h), the Corporation
  shall, as promptly as practicable, cause to be distributed to holders of record
  of Rights Certificates on such record date, Rights Certificates evidencing the
  additional Rights to which such holder shall be entitled as a result of such
  adjustment, or, at the option of the Corporation, shall cause to be distributed
  to such holders of record in substitution or replacement for the Rights Certificates
  held by such holders prior to the date of adjustment, and upon surrender thereof,
  if required by the Corporation, new Rights Certificates evidencing all the Rights
  to which such holders shall be entitled after such adjustment. Rights Certificates
  so to be distributed shall be issued, executed and countersigned 

- 17 - 

in the manner provided for herein and may bear, at the option
of the Corporation, the adjusted Exercise Price and shall be registered in the
names of the holders of record of Rights Certificates on the record date
specified in the public announcement. 

          (i)     
  Irrespective of any adjustment or change in the securities purchasable upon
  exercise of the Rights, the Rights Certificates theretofore and thereafter issued
  may continue to express the securities so purchasable which were expressed in
  the initial Rights Certificates issued hereunder. 

          (j)     
  If, as a result of an adjustment made pursuant to Section 3.1, the holder of
  any Right thereafter Exercised shall become entitled to receive any securities
  other than Common Shares, thereafter the number of such other securities so
  receivable upon exercise of any Right and the applicable Exercise Price thereof
  shall be subject to adjustment from time to time in a manner and on terms as
  nearly equivalent as may be practicable to the provisions with respect to the
  Common Shares contained in the foregoing subsections of this Section 2.3 and
  the provisions of this Agreement with respect to the Common Shares shall apply
  on like terms to any such other securities. 

          (k)     
  In any case in which this Section 2.3 shall require that any adjustment in the
  Exercise Price be made effective as of a record date for a specified event,
  the Corporation may elect to defer until the occurrence of such event the issuance
  to the holder of any Right exercised after such record date of the number of
  Common Shares and other securities of the Corporation, if any, issuable upon
  such exercise over and above the number of Common Shares and other securities
  of the Corporation, if any, issuable upon such exercise on the basis of the
  Exercise Price in effect prior to such adjustment; provided, however, that
  the Corporation shall deliver to such holder a due bill or other appropriate
  instrument evidencing such holder’s right to receive such additional Common
  Shares or other securities upon the occurrence of the event requiring such adjustment.

          (l)     
  Whenever an adjustment to the Exercise Price or a change in the securities purchasable
  upon the exercise of Rights is made pursuant to this Section 2.3, the Corporation
  shall promptly: 

	 	(i) 	
      prepare a certificate setting forth such adjustment and a
      brief statement of the facts accounting for such adjustment;

	 	 	 
	 	(ii) 	
      file with the Rights Agent and with each transfer agent
      for the Common Shares, a copy of such certificate; and

	 	 	 
	 	(iii) 	
      cause notice of the particulars of such adjustment or
      change to be given to the holders of the Rights.

Failure to file such certificate or to cause such notice to be
given as aforesaid, or any defect therein, shall not affect the validity of any
such adjustment or change. 

	2.4 	Date on Which Exercise is Effective
  

                    Each
  Person in whose name any certificate for Shares is issued upon the exercise
  of Rights shall for all purposes be deemed to have become the holder of record
  of the Shares represented thereby on, and such certificate shall be dated, the
  date upon which the Rights Certificate evidencing such Rights was duly submitted
  (together with a duly completed Election to Exercise) and payment of the Exercise
  Price for such Rights (and any applicable transfer taxes and other charges payable
  by the exercising holder hereunder) was made; provided, however, that
  if the date of such exercise is a date upon which the relevant Share transfer
  books of the Corporation are closed, such Person shall be deemed to have become
  the recorded holder of such Shares on, and such certificate shall be dated,
  the next succeeding Business Day on which the said Share transfer books of the
  Corporation are open. 

	2.5 	Execution, Authentication, Delivery and
      Dating of Rights Certificates 

          (a)      
  The Rights Certificates shall be executed on behalf of the Corporation by its
  Chief Executive Officer, Chief Operating Officer or Chief Financial Officer
  under its corporate seal reproduced thereon attested by 

- 18 - 

its Secretary or one of its Assistant Secretaries. The
signature of any of these officers on the Rights Certificates may be manual or
facsimile. 

          (b)     
  Rights Certificates bearing the manual or facsimile signatures of individuals
  who were at any time the proper officers of the Corporation shall bind the Corporation,
  notwithstanding that such individuals or any of them have ceased to hold such
  offices prior to the countersignature and delivery of such Rights Certificates.

          (c)     
  Promptly after the Corporation learns of the Separation Time, the Corporation
  shall notify the Rights Agent of such Separation Time and shall deliver Rights
  Certificates executed by the Corporation to the Rights Agent for countersignature,
  and the Rights Agent shall countersign (manually or by facsimile signature in
  a manner satisfactory to the Corporation) and deliver such Rights Certificates
  to the holders of the Rights pursuant to subsection 2.2(c) hereof. No Rights
  Certificate shall be valid for any purpose until countersigned by the Rights
  Agent in the manner described above. 

          (d)     
  Each Rights Certificate shall be dated the date of countersignature thereof.

	2.6 	Registration, Registration of Transfer and
      Exchange 

          (a)    
   The Corporation shall cause to be kept a register (the “Rights
  Register”) in which, subject to such reasonable regulations as it may
  prescribe, the Corporation shall provide for the registration and transfer of
  Rights. The Rights Agent is hereby appointed “Rights Registrar”
  for the purpose of maintaining the Rights Register for the Corporation and registering
  Rights and transfers of Rights as herein provided. If the Rights Agent shall
  cease to be the Rights Registrar, the Rights Agent shall have the right to examine
  the Rights Register at all reasonable times. 

                    After
  the Separation Time and prior to the Expiration Time, upon surrender for registration
  of transfer or exchange of any Rights Certificate, and subject to the provisions
  of subsection 2.6(c) below, the Corporation shall execute, and the Rights Agent
  shall countersign and deliver, in the name of the holder or the designated transferee
  or transferees, as required pursuant to the holder’s instructions, one
  or more new Rights Certificates evidencing the same aggregate number of Rights
  as did the Rights Certificate so surrendered. 

          (b)     
  All Rights issued upon any registration of transfer or exchange of Rights Certificates
  shall be the valid obligations of the Corporation, and such Rights shall be
  entitled to the same benefits under this Agreement as the Rights surrendered
  upon such registration of transfer or exchange. 

          (c)    
   Every Rights Certificate surrendered for registration of transfer or exchange
  shall have the form of assignment thereon duly completed and endorsed, or be
  accompanied by a written instrument of transfer in form satisfactory to the
  Corporation or the Rights Agent, as the case may be, duly executed by the holder
  thereof or such holder’s attorney duly authorized in writing. As a condition
  to the issuance of any new Rights Certificate under this Section 2.6, the Corporation
  may require the payment of a sum sufficient to cover any tax or other governmental
  charge that may be imposed in relation thereto and other expenses (including
  the reasonable fees and expenses of its Rights Agent) connected therewith. 

          (d)     
  The Corporation shall not be required to register the transfer or exchange of
  any Rights after the Rights have been terminated pursuant to the provisions
  of this Agreement. 

	2.7 	Mutilated, Destroyed, Lost and Stolen Rights
      Certificates 

          (a)     
  If any mutilated Rights Certificate is surrendered to the Rights Agent prior
  to the Expiration Time, the Corporation shall execute and the Rights Agent shall
  countersign and deliver a new Rights Certificate evidencing the same number
  of Rights as did the Rights Certificate so surrendered. 

          (b)      If
  there shall be delivered to the Corporation and the Rights Agent prior to the
  Expiration Time (i) evidence to their satisfaction of the destruction, loss
  or theft of any Rights Certificate and (ii) such security or indemnity as may
  be required by them to save each of them and their respective agents harmless,
  then, in the absence of notice to the Corporation or the Rights Agent that such
  Rights Certificate has been acquired by a bona 

- 19 - 

fide purchaser, the Corporation shall execute and upon the
Corporation’s request, the Rights Agent shall countersign and deliver, in lieu
of any such destroyed, lost or stolen Rights Certificate, a new Rights
Certificate evidencing the same number of Rights as did the Rights Certificate
so destroyed, lost or stolen. 

          (c)     
  As a condition to the issuance of any new Rights Certificate under this Section
  2.7, the Corporation may require the payment of a sum sufficient to cover any
  tax or other governmental charge that may be imposed in relation thereto and
  any other expenses (including the reasonable fees and expenses of the Rights
  Agent) connected therewith. 

          (d)     
  Every new Rights Certificate issued pursuant to this Section 2.7 in lieu of
  any destroyed, lost or stolen Rights Certificate shall evidence an original
  additional contractual obligation of the Corporation, whether or not the destroyed,
  lost or stolen Rights Certificate shall be at any time enforceable by anyone,
  and shall be entitled to all the benefits of this Agreement equally and proportionately
  with any and all other Rights duly issued hereunder. 

	2.8 	Persons Deemed Owners

                    Prior
  to due presentment of a Rights Certificate (or, prior to the Separation Time,
  the associated Share certificate) for registration of transfer, the Corporation,
  the Rights Agent and any agent of the Corporation or the Rights Agent may deem
  and treat the Person in whose name such Rights Certificate (or, prior to the
  Separation Time, such Share certificate) is registered as the absolute owner
  thereof and of the Rights evidenced thereby for all purposes whatsoever. As
  used in this Agreement, unless the context otherwise requires, the term “holder”
  of any Rights means the registered holder of such Rights (or, prior to the Separation
  Time, the associated Shares). 

	2.9 	Delivery and Cancellation of
      Certificates 

                    All
  Rights Certificates surrendered upon exercise or for redemption, registration
  of transfer or exchange shall, if surrendered to any Person other than the Rights
  Agent, be delivered to the Rights Agent and, in any case, shall be promptly
  cancelled by the Rights Agent. The Corporation may at any time deliver to the
  Rights Agent for cancellation any Rights Certificates previously countersigned
  and delivered hereunder which the Corporation may have acquired in any manner
  whatsoever, and all Rights Certificates so delivered shall be promptly cancelled
  by the Rights Agent. No Rights Certificates shall be countersigned in lieu of
  or in exchange for any Rights Certificates cancelled as provided in this Section
  2.9, except as expressly permitted by this Agreement. The Rights Agent shall
  destroy all cancelled Rights Certificates and deliver a certificate of destruction
  to the Corporation. 

	2.10 	Agreement of Rights Holders
  

                    Every
  holder of Rights by accepting the same consents and agrees with the Corporation
  and the Rights Agent and with every other holder of Rights that: 

          (a)     
  such holder shall be bound by and subject to the provisions of this Agreement,
  as amended from time to time in accordance with the terms hereof, in respect
  of all Rights held; 

          (b)    
   prior to the Separation Time, each Right shall be transferable only together
  with, and shall be transferred by a transfer of, the associated Share; 

          (c)     
  after the Separation Time, the Rights Certificates shall be transferable only
  on the Rights Register as provided herein; 

          (d)     
  prior to due presentment of a Rights Certificate (or, prior to the Separation
  Time, the associated Share certificate) for registration of transfer, the Corporation,
  the Rights Agent and any agent of the Corporation or the Rights Agent may deem
  and treat the Person in whose name the Rights Certificate (or, prior to the
  Separation Time, the associated Share certificate) is registered as the absolute
  owner thereof and of the Rights evidenced thereby (notwithstanding any notations
  of ownership or writing on such Rights Certificate or the associated Share 

- 20 - 

certificate made by anyone other than the Corporation or the
Rights Agent) for all purposes whatsoever, and neither the Corporation nor the
Rights Agent shall be affected by any notice to the contrary; 

          (e)     
  such holder has waived all rights to receive any fractional Right or fractional
  Share upon exercise of a Right; 

          (f)    
   this Agreement may be supplemented or amended from time to time pursuant
  to subsection 5.4(a) or the last sentence of the penultimate paragraph of subsection
  2.3(a) hereof upon the sole authority of the Board of Directors without the
  approval of any holder of Rights. 

	2.11 	Rights Certificate Holder Deemed Not a
      Shareholder 

                    No
  holder of any Rights or Rights Certificate is entitled, as such holder, to vote,
  receive dividends or be considered for any purpose the holder of any Common
  Share or any other share or security of the Corporation which may at any time
  be issuable on the exercise of the Rights represented thereby, and nothing contained
  herein or in any Rights Certificate is to be construed as conferring upon the
  holder of any Right or Rights Certificate, as such, any right of a holder of
  Common Shares or any other shares or securities of the Corporation or any right
  to vote at any meeting of shareholders of the Corporation whether for the election
  of directors or otherwise or upon any matter submitted to holders of Common
  Shares or any other shares of the Corporation at any meeting thereof, or to
  give or withhold consent to any action of the Corporation or to receive notice
  of any meeting or other action affecting any holder of Common Shares or any
  other shares of the Corporation except as expressly provided herein, or to receive
  dividends, distributions or subscription rights, or otherwise, until the Right
  or Rights evidenced by Rights Certificates have been duly exercised in accordance
  with the terms and provisions hereof. 

ARTICLE 3 - ADJUSTMENTS TO THE RIGHTS 
IN THE EVENT OF
CERTAIN TRANSACTIONS 

	3.1 	Flip-in Event 

          (a)     
  Subject to the provisions of Subsection 3.1(b) and Section 5.1 hereof, if prior
  to the Expiration Time a Flip-in Event shall occur, each Right shall thereafter
  constitute, effective at the Close of Business on the tenth Business Day after
  the relevant Stock Acquisition Date, the right to purchase from the Corporation,
  upon exercise thereof in accordance with the terms hereof, that number of Common
  Shares of the Corporation having an aggregate Market Price on the date of consummation
  or occurrence of such Flip-in Event equal to twice the Exercise Price for an
  amount in cash equal to the Exercise Price (such right to be appropriately adjusted
  in a manner analogous to the applicable adjustment provided for in Section 2.3
  hereof in the event that, after such date of consummation or occurrence, an
  event of a type analogous to any of the events described in Section 2.3 hereof
  shall have occurred with respect to such Common Shares). 

          (b)     
  Anything in this Agreement to the contrary notwithstanding, upon the occurrence
  of a Flip-In Event, any Rights that are or were Beneficially Owned on or after
  the earlier of the Separation Time and the Stock Acquisition Date by: 

	 	(i) 	
      an Acquiring Person (or any Person acting jointly or in
      concert with an Acquiring Person or with an Affiliate or Associate of an
      Acquiring Person), or

	 	 	 
	 	(ii) 	
      a direct or indirect transferee of, or other successor in
      title to, such Rights (a “Transferee”), who becomes a Transferee
      concurrently with or subsequent to the Acquiring Person becoming an
      Acquiring Person, in a transfer, whether or not for consideration, that
      the Board of Directors has determined is part of a plan, understanding or
      scheme of an Acquiring Person (or an Affiliate or Associate of an
      Acquiring Person or any Person acting jointly or in concert with an
      Acquiring Person or an Affiliate or Associate of an Acquiring Person) that
      has the purpose or effect of avoiding the provisions of this subsection
      3.1(b) applicable in the circumstances contemplated in clause (i)
      hereof,

- 21 - 

shall thereupon become and be void and any holder of such
Rights (including any Transferee) shall thereafter have no rights whatsoever
with respect to such Rights, whether under any provision of this Agreement or
otherwise. The holder of any Rights represented by a Rights Certificate which is
submitted to the Rights Agent, or any Co-Rights Agent, upon exercise or for
registration of transfer or exchange which does not contain the necessary
certifications set forth in the Rights Certificate establishing that such Rights
are not void under this subsection 3.1(b) shall be deemed to be an Acquiring
Person for the purposes of this subsection 3.1(b) and such rights shall be null
and void. 

          (c)     
  From and after the Separation Time the Corporation shall do all such acts and
  things as shall be necessary and within its power to ensure compliance with
  the provisions of this Section 3.1, including without limitation, all such acts
  and things as may be required to satisfy the requirements of the Business
  Corporations Act (British Columbia), the Securities Act (British
  Columbia) and the securities laws or comparable legislation in each of the provinces
  of Canada in respect of the issue of Common Shares upon the exercise of Rights
  in accordance with this Agreement. 

          (d)     
  Any Rights Certificate that represents Rights Beneficially Owned by a Person
  described in either clauses (i) or (ii) of subsection 3.1(b) hereof or transferred
  to any nominee of any such Person, and any Rights Certificate issued upon the
  transfer, exchange or replacement of any other Rights Certificate referred to
  in this sentence shall contain the following legend: 

	 	
      “The Rights represented by this Rights Certificate were
      issued to a Person who was an Acquiring Person or an Affiliate or an
      Associate of an Acquiring Person (as such terms are defined in the Rights
      Agreement) or was acting Jointly or in concert with any of them. This
      Rights Certificate and the Rights represented hereby shall become void in
      the circumstances specified in subsection 3.1(b) of the Rights Agreement.”
      
	 

provided, however, that the Rights Agent shall not be
under any responsibility to ascertain the existence of facts that would require
the imposition of such legend but shall be required to impose such legend only
if instructed to do so by the Corporation or if a holder fails to certify upon
transfer or exchange in the space provided on the Rights Certificate that such
holder is not an Acquiring Person or an Affiliate or Associate thereof or acting
jointly or in concert with any of them. 

ARTICLE 4 - THE RIGHTS AGENT 

	4.1 	General 

          (a)     
  The Corporation hereby appoints the Rights Agent to act as agent for the Corporation
  and the holders of Rights in accordance with the terms and conditions hereof,
  and the Rights Agent hereby accepts such appointment. The Corporation may from
  time to time appoint one or more co-rights agents (each, a “Co-Rights
  Agent”) as it may deem necessary or desirable after consultation with
  the Rights Agent. In such event, the respective duties of the Rights Agent and
  any Co-Rights Agent shall be as the Corporation may determine after consultation
  with the Rights Agent and Co-Rights Agent. The Corporation agrees to pay to
  the Rights Agent reasonable compensation for all services rendered by it hereunder
  and, from time to time on demand of the Rights Agent, its reasonable expenses
  and counsel fees and other disbursements incurred in the administration and
  execution of this Agreement and the exercise and performance of its duties hereunder.
  The Corporation also agrees to indemnify the Rights Agent, its officers, directors,
  employees and agents for, and to hold them harmless against, any loss, liability,
  or expense, incurred without negligence, bad faith or wilful misconduct on the
  part of the Rights Agent, its officers, directors, employees or agents, for
  anything done or omitted by them in connection with the acceptance and performance
  of this Agreement, including legal costs and expenses, which right to indemnification
  shall survive the termination of this Agreement or the resignation or removal
  of the Rights Agent. 

          (b)     
  The Rights Agent shall be protected from, and shall incur no liability for or
  in respect of, any action taken, suffered or omitted by it in connection with
  its performance of this Agreement in reliance upon any certificate for Shares,
  Rights Certificate, certificate for other securities of the Corporation, instrument
  of assignment or transfer, power of attorney, endorsement, affidavit, letter,
  notice, direction, consent, certificate, opinion, statement, or other paper
  or document believed by it to be genuine and to be signed, executed and, where
  necessary, verified or acknowledged, by the proper Person or Persons. 

- 22 - 

                    The
  Corporation shall inform the Rights Agent in a reasonably timely manner of events
  which may materially affect the administration of this Agreement by the Rights
  Agent and, at any time upon written request, shall provide to the Rights Agent
  an incumbency certificate certifying the then current officers of the Corporation.

	4.2 	Merger or Amalgamation or Change of Name of
      Rights Agent 

          (a)    
   Any body corporate into which the Rights Agent or any successor Rights
  Agent may be merged or amalgamated with or into, or any body corporate succeeding
  to the security holder services business of the Rights Agent or any successor
  Rights Agent, shall be the successor to the Rights Agent under this Agreement
  without the execution or filing of any paper or any further act on the part
  of any of the parties hereto, provided that such body corporate would be eligible
  for appointment as a successor Rights Agent under the provisions of Section
  4.4 hereof. In case at the time such successor Rights Agent succeeds to the
  agency created by this Agreement any of the Rights Certificates have been countersigned
  but not delivered, any such successor Rights Agent may adopt the countersignature
  of the predecessor Rights Agent and deliver such Rights Certificates so countersigned;
  and in case at that time any of the Rights Certificates have not been countersigned,
  any successor Rights Agent may countersign such Rights Certificates either in
  the name of the predecessor Rights Agent or in the name of the successor Rights
  Agent; and in all such cases such Rights Certificates shall have the full force
  provided in the Rights Certificates and in this Agreement. 

          (b)    
   In case at any time the name of the Rights Agent is changed and at such
  time any of the Rights Certificates shall have been countersigned but not delivered,
  the Rights Agent may adopt the countersignature under its prior name and deliver
  Rights Certificates so countersigned; and in case at that time any of the Rights
  Certificates shall not have been countersigned, the Rights Agent may countersign
  such Rights Certificates either in its prior name or in its changed name; and
  in all such cases such Rights Certificates shall have the full force provided
  in the Rights Certificates and in this Agreement. 

	4.3 	Duties of Rights Agent

                    The
  Rights Agent undertakes the duties and obligations imposed by this Agreement
  upon the following terms and conditions, by all of which the Corporation and
  the holders of Rights Certificates, by their acceptance thereof, shall be bound:

	 	(a) 	
      The Rights Agent may retain and consult with legal
      counsel (who may be legal counsel for the Corporation), and the opinion of
      such counsel will be full and complete authorization and protection to the
      Rights Agent as to any action taken or omitted by it in good faith and in
      accordance with such opinion.

	 	 	 
	 	(b) 	
      Whenever in the performance of its duties under this
      Agreement the Rights Agent deems it necessary or desirable that any fact
      or matter be proved or established by the Corporation prior to taking or
      suffering any action or refraining from taking any action hereunder, such
      fact or matter (unless other evidence in respect thereof be herein
      specifically prescribed) may be deemed to be conclusively proved and
      established by a certificate signed by an individual believed by the
      Rights Agent to be the Chief Executive Officer, Chief Operating Officer,
      Chief Financial Officer or the Secretary of the Corporation and delivered
      to the Rights Agent; and such certificate shall be full authorization to
      the Rights Agent for any action taken, omitted or suffered in good faith
      by it under the provisions of this Agreement in reliance upon such
      certificate.

	 	 	 
	 	(c) 	
      The Rights Agent shall be liable hereunder only for its
      own negligence, bad faith or wilful misconduct.

	 	 	 
	 	(d) 	
      The Rights Agent shall not be liable for or by reason of
      any of the statements of fact or recitals contained in this Agreement or
      in the certificates for Shares or the Rights Certificates (except its
      countersignature thereof) or be required to verify the same, but all such
      statements and recitals are and will be deemed to have been made by the
      Corporation only.

- 23 - 

	 	(e) 	
      The Rights Agent shall not be under any responsibility in
      respect of the validity of this Agreement or the execution and delivery
      hereof (except the due authorization, execution and delivery hereof by the
      Rights Agent) or in respect of the validity or execution of any Share
      certificate or Rights Certificate (except its countersignature thereof);
      nor will it be responsible for any breach by the Corporation of any
      covenant or condition contained in this Agreement or in any Rights
      Certificate; nor will it be responsible for any change in the
      exercisability of the Rights (including the Rights becoming void pursuant
      to subsection 3.1(b) hereof) or any adjustment required under the
      provisions of Section 2.3 hereof or responsible for the manner, method or
      amount of any such adjustment or the ascertaining of the existence of
      facts that would require any such adjustment (except with respect to the
      exercise of Rights after receipt of the certificate contemplated by
      Section 2.3 hereof describing any such adjustment); nor will it by any act
      hereunder be deemed to make any representation or warranty is to the
      authorization or reservation of any Shares to be issued pursuant to this
      Agreement or any Rights or as to whether any Shares shall, when issued, be
      duly and validly authorized, executed, issued and delivered and be fully
      paid and non-assessable.

	 	 	 
	 	(f) 	
      The Corporation agrees that it will perform, execute,
      acknowledge and deliver or cause to be performed, executed, acknowledged
      and delivered all such further and other acts, instruments and assurances
      as may reasonably be required by the Rights Agent for the carrying out or
      performing by the Rights Agent of the provisions of this
  Agreement.

	 	 	 
	 	(g) 	
      The Rights Agent is hereby authorized to rely upon and
      directed to accept written instructions with respect to the performance of
      its duties hereunder from any individual believed by the Rights Agent to
      be the Chairman, the President and Chief Executive Officer or any
      Vice-President or the Secretary or any Assistant Secretary or the
      Treasurer or any Assistant Treasurer of the Corporation, and to apply to
      such individuals for advice or instructions in connection with its duties,
      and it shall not be liable for any action taken, omitted or suffered by it
      in good faith in accordance with instructions of any such
    individual.

	 	 	 
	 	(h) 	
      The Rights Agent and any shareholder, director, officer
      or employee of the Rights Agent may buy, sell or deal in Shares, Rights or
      other securities of the Corporation or become pecuniarily interested in
      any transaction in which the Corporation may be interested, or contract
      with or lend money to the Corporation or otherwise act as fully and freely
      as though it were not Rights Agent under this Agreement. Nothing herein
      shall preclude the Rights Agent from acting in any other capacity for the
      Corporation or for any other legal entity.

	 	 	 
	 	(i) 	
      The Rights Agent may execute and exercise any of the
      rights or powers hereby vested in it or perform any duty hereunder either
      itself or by or through its attorneys or agents, and the Rights Agent
      shall not be answerable or accountable for any act, default, neglect or
      misconduct of any such attorneys or agents or for any loss to the
      Corporation resulting from any such act, omission, default, neglect or
      misconduct, provided reasonable care was exercised in the selection and
      continued employment thereof.

	4.4 	Change of Rights Agent

                    The
  Rights Agent may resign and be discharged from its duties under this Agreement
  upon 60 days’ notice (or such lesser notice as is acceptable to the Corporation)
  in writing delivered or mailed to the Corporation and to each transfer agent
  of Shares by first class mall, and mailed or delivered to the holders of the
  Rights in accordance with Section 5.9 hereof. The Corporation may remove the
  Rights Agent upon 30 days’ notice in writing, mailed or delivered to the
  Rights Agent and to each transfer agent of the Shares by first class mall, and
  mailed to the holders of the Rights in accordance with Section 5.9 hereof. If
  the Rights Agent should resign or be removed or otherwise become incapable of
  acting, the Corporation shall appoint a successor to the Rights Agent. If the
  Corporation fails to make such appointment within a period of 30 days after
  such removal or after it has been notified in writing of such resignation or
  incapacity by the resigning or incapacitated Rights Agent or by the holder of
  any Rights (which holder shall, with such notice, submit such holder’s
  Rights Certificate for inspection by the Corporation), then the holder of any
  Rights may apply, at the Corporation’s expense, to any court of competent
  jurisdiction for the appointment of a new Rights Agent, Any successor Rights
  Agent, whether appointed by the 

- 24 - 

Corporation or by such a court, shall be a body corporate
incorporated under the laws of Canada or a province thereof authorized to carry
on the business of a trust company in the Province of British Columbia. After
appointment, the successor Rights Agent shall be vested with the same powers,
rights, duties and responsibilities as if it had been originally named as Rights
Agent without further act or deed; but the predecessor Rights Agent shall
deliver and transfer to the successor Rights Agent any property at the time held
by it hereunder, and execute and deliver any further assurance, conveyance, act
or deed necessary for the purpose. Not later than the effective date of any such
appointment, the Corporation shall file notice thereof in writing with the
predecessor Rights Agent and each transfer agent of the Shares, and mail a
notice thereof in writing to the holders of the Rights. Failure to give any
notice provided for in this Section 4.4, however, or any defect therein, shall
not affect the legality or validity of the resignation or removal of the Rights
Agent or the appointment of the successor Rights Agent, as the case may be. 

ARTICLE 5 - MISCELLANEOUS 

	5.1 	Redemption and Waiver

          (a)     
  Subject to the prior consent of the holders of Voting Shares or Rights (obtained
  as described in Section 5.4(b) or Section 5.4(c)), the Board of Directors may,
  at any time prior to the occurrence of a Flip-in Event, elect to redeem all
  but not less than all of the then outstanding Rights at a redemption price of
  $0.0001 per Right appropriately adjusted in a manner analogous to the applicable
  adjustment provided for in Section 2.3 if an event of the type analogous to
  any of the events described in Section 2.3 shall have occurred (such redemption
  price being herein referred to as the “Redemption Price”).

          (b)     
  The Board of Directors may waive the application of Section 3.1 in respect of
  the occurrence of any Flip-in Event if the Board of Directors has determined
  within eight Trading Days following a Stock Acquisition Date that a Person became
  an Acquiring Person by inadvertence and without any intention to become, or
  knowledge that it would become, an Acquiring Person under this Agreement and
  if such a waiver is granted by the Board of Directors, such Stock Acquisition
  Date is deemed not to have occurred. Any such waiver pursuant to this subsection
  5.1(b) must be on the condition that such Person has, within 10 days after the
  foregoing determination by the Board of Directors or such earlier or later date
  as the Board of Directors may determine (the “Disposition Date”),
  reduced its Beneficial Ownership of Voting Shares such that the Person is no
  longer an Acquiring Person or has entered into a contractual arrangement with
  the Corporation, acceptable to the Board of Directors, to do so within 30 days
  of the date on which the contractual arrangement is entered into. If the Person
  remains an Acquiring Person at the close of business on the Disposition Date,
  the Disposition Date is deemed to be the date of occurrence of a further Stock
  Acquisition Date and Section 3.1 applies thereto. 

          (c)    
   If before the occurrence of a Flip-in Event a Person acquires, pursuant
  to a Permitted Bid, a Competing Permitted Bid or a Take-over Bid in respect
  of which the Board of Directors of the Corporation has waived the application
  of Section 3.1 pursuant to Subsection 5.1(d), any outstanding Common Shares,
  the Corporation shall, immediately upon such acquisition and without further
  formality, redeem the Rights at the Redemption Price. 

          (d)     
  The Board of Directors may, prior to the occurrence of a Flip-in Event as to
  which the application of Section 3.1 has not been waived pursuant to this clause,
  determine, upon prior written notice to the Rights Agent, to waive the application
  of Section 3.1 to that Flip-in Event provided that the Flip-in Event would occur
  by reason of a Take-over Bid made by means of a Take-over Bid circular sent
  to all holders of record of Voting Shares and further provided that if the Board
  of Directors waives the application of Section 3.1 to such Flip-in Event, the
  Board of Directors shall be deemed to have waived the application of Section
  3.1 to any other Flip-in Event occurring by reason of a Take-over Bid made by
  means of a Take-over Bid circular sent to all holders of record of Voting Shares
  prior to the expiry of any Take-over Bid, as the same may be extended from time
  to time, in respect of which a waiver is, or is deemed to have been, granted
  under this subsection 5.1(d) .

          (e)     
  If the Rights are redeemed pursuant to this Agreement, the right to exercise
  the Rights will thereupon, without further action and without notice, terminate
  and the only right thereafter of the holders of Rights is to receive the Redemption
  Price. 

- 25 - 

          (f)     
  Within 10 days after the Rights are redeemed pursuant to this Agreement, the
  Corporation shall give notice of redemption to the holders of the then outstanding
  Rights by mailing such notice to all such holders at their last address as they
  appear upon the registry books of the Rights Agent or, prior to the Separation
  Time, on the registry books of the transfer agent for the Voting Shares. Any
  notice which is mailed in the manner herein provided shall be deemed given,
  whether or not the holder receives the notice. Each such notice of redemption
  must state how the Redemption Price will be paid. 

          (g)     
  Where a Take-over Bid that is not a Permitted Bid or Competing Permitted Bid
  is withdrawn or otherwise terminated after the Separation Time has occurred
  and prior to the occurrence of a Flip-in Event, the Board of Directors may elect
  to redeem all the outstanding Rights at the Redemption Price. 

          (h)     
  Notwithstanding the Rights being redeemed pursuant to this Section 5.1, all
  the provisions of this Agreement shall continue to apply as if the Separation
  Time had not occurred and Rights Certificates representing the number of Rights
  held by each holder of record of Common Shares as of the Separation Time had
  not been mailed to each such holder and for all purposes of this Agreement the
  Separation Time shall be deemed not to have occurred and the Rights shall remain
  attached to outstanding Voting Shares, subject to and in accordance with the
  provisions of this Agreement. 

	5.2 	Expiration 

                    No
  Person shall have any rights pursuant to this Agreement or any Right after the
  Expiration Time, except as provided in Section 4.1 hereof. 

	5.3 	Issuance of New Rights Certificates
  

                    Notwithstanding
  any of the provisions of this Agreement or of the Rights to the contrary, the
  Corporation may, at its option, issue new Rights Certificates evidencing Rights
  in such form as may be approved by the Board of Directors to reflect any adjustment
  or change in the number or kind or class of Shares purchasable upon exercise
  of Rights made in accordance with the provisions of this Agreement. 

	5.4 	Supplements and Amendments

          (a)     
  At any time, the Corporation may, by resolution of the Board of Directors, amend
  this Agreement to correct any clerical or typographical errors or to maintain
  the validity of this Agreement as a result of any changes in applicable legislation
  or applicable rules or policies of securities regulatory authorities, and such
  amendments shall be in force immediately after such a resolution is passed by
  the Board of Directors. 

          (b)    
   Prior to the Separation Time, the Corporation may, by resolution of the
  Board of Directors, and with the prior consent of the holders of Voting Shares
  obtained as set forth below, supplement or amend this Agreement and the Rights
  (whether or not such action would materially adversely affect the interests
  of the holders of Rights generally). Such consent is deemed to have been given
  if the supplement or amendment is approved by the affirmative vote of a majority
  of the votes cast by Independent Shareholders represented in person or by proxy
  and entitled to be voted at a meeting of the holders of Voting Shares duly called
  and held in compliance with applicable laws and the articles and bylaws of the
  Corporation. 

          (c)     
  After the Separation Time, the Corporation may, by resolution of the Board of
  Directors, and with the prior consent of the holders of Rights obtained as set
  forth below, supplement or amend this Agreement and the Rights (whether or not
  such action would materially adversely affect the interests of the holders of
  Rights generally). Such consent is deemed to have been given if provided by
  the holders of Rights at a Rights Holders’ Special Meeting, which Rights
  Holders’ Special Meeting is called and held in compliance with applicable
  laws and regulatory requirements and, to the extent possible, with the requirements
  in the articles and by-laws of the Corporation applicable to meetings of holders
  of Voting Shares varied as the Corporation thinks appropriate. Subject to compliance
  with any requirements imposed by the foregoing, consent is given if the proposed
  supplement or amendment, is approved by the affirmative vote of a majority of
  the votes cast by holders of Rights (other than 

- 26 - 

holders of Rights whose Rights have become void pursuant to
subsection 3.1(b)), represented in person or by proxy at the Rights Holders’
Special Meeting. 

          (d)     
  Notwithstanding anything in this Section 5.4 to the contrary, no such supplement
  or amendment shall be made to the provisions of Article 4 except with the written
  concurrence of the Rights Agent to such supplement or amendment. 

          (e)     
  Any supplement to or amendment to this Agreement shall require the prior written
  consent of The Toronto Stock Exchange. 

          (f)     
  Any amendments made by the Corporation to this Agreement pursuant to subsection
  5.4(a) which are required to maintain the validity of this Agreement as a result
  of any changes in applicable legislation or applicable rules or policies of
  securities regulatory authorities shall: 

	 	(i) 	
      if made before the Separation Time, be submitted to the
      shareholders of the Corporation at the next meeting of shareholders and
      the shareholders may, by a vote of the majority referred to in subsection
      5.4(b), confirm or reject such amendment; and

	 	 	 
	 	(ii) 	
      if made after the Separation Time, be submitted to
      holders of Rights at a meeting to be called for on a date not later than
      immediately following the next meeting of shareholders of the Corporation
      and the holders of Rights may, by a vote of the majority referred to in
      subsection 5.4(c), confirm or reject such
amendment.

Any such amendment shall be effective
from the date of the resolution of the Board of Directors adopting such
amendment, until it is confirmed or rejected in accordance with this subsection
5.4(f) or until it ceases to be effective (as described below) and, where such
amendment is confirmed, it continues in effect in the form so confirmed. If such
amendment is rejected by shareholders or holders of Rights or is not submitted
to shareholders or holders of Rights as required, then such amendment shall
cease to be effective from and after the termination of the meeting at which it
was rejected or to which it should have been but was not submitted or from and
after the date of the meeting of holders of Rights that should have been but was
not held, and no subsequent resolution of the Board of Directors to amend this
Agreement to substantially the same effect shall be effective until confirmed by
shareholders or holders of Rights, as the case may be. 

	5.5 	Fractional Rights and Fractional Common
      Shares 

          (a)    
   The Corporation shall not be required to issue fractions of Rights or
  to distribute Right Certificates which evidence fractional Rights or to pay
  any amount to a holder of record of Rights Certificates in lieu of such fractional
  Rights. 

          (b)     
  The Corporation shall not be required to issue fractions of Common Shares upon
  exercise of the Rights or to distribute certificates which evidence fractional
  Common Shares. In lieu of issuing fractional Common Shares, the Corporation
  shall pay to the registered holders of Right Certificates at the time such Rights
  are exercised as herein provided, an amount in cash equal to the same fraction
  of the Market Price of one Common Share that the fraction of a Common Share
  that would otherwise be issuable upon the exercise of such Right is of a whole
  Common Share. 

	5.6 	Rights of Action 

                    Subject
  to the terms of this Agreement, rights of action in respect of this Agreement,
  other than rights of action vested solely in the Rights Agent, are vested in
  the respective holders of the Rights, and any holder of any Rights, without
  the consent of the Rights Agent or of the holder of any other Rights may, on
  such holder’s own behalf and for such holder’s own benefit and the
  benefit of other holders of Rights, enforce, and may institute and maintain
  any suit, action or proceeding against the Corporation to enforce, or otherwise
  act in respect of, such 

- 27 - 

holder’s right to exercise such holder’s Rights in the manner
provided in such holder’s Rights Certificate and in this Agreement. Without
limiting the foregoing or any remedies available to the holders of Rights, it is
specifically acknowledged that the holders of Rights would not have an adequate
remedy at law for any breach of this Agreement and will be entitled to specific
performance of the obligations under, and injunctive relief against actual or
threatened violations of the obligations of any Person subject to, this
Agreement. 

	5.7 	Holder of Rights Not Deemed a
      Shareholder 

                    No
  holder, as such, of any Rights shall be entitled to vote, receive dividends
  or be deemed for any purpose the holder of Common Shares or any other securities
  which may at any time be issuable on the exercise of such Rights, nor shall
  anything contained herein or in any Rights Certificate be construed to confer
  upon the holder of any Rights, as such, any of the rights of a shareholder of
  the Corporation or any right to vote for the election of directors or upon any
  matter submitted to shareholders at any meeting thereof, or to give or withhold
  consent to any corporate action, or to receive notice of meetings or other actions
  affecting shareholders (except as provided in Section 5.8 hereof), or to receive
  dividends or subscription rights, or otherwise, until such Rights shall have
  been exercised in accordance with the provisions hereof. 

	5.8 	Non-Canadian or United States Holders
  

                    If
  in the opinion of the Board of Directors (who may rely upon the advice of counsel)
  any action or event contemplated by this Agreement would require compliance
  by the Corporation with the securities laws or comparable legislation of a jurisdiction
  outside Canada or the United States, the Board of Directors may take such actions
  as it may deem appropriate to ensure that such compliance is not required, including
  without limitation establishing procedures for the issuance to a Canadian resident
  Fiduciary of Rights or securities issuable on exercise of Rights, the holding
  thereof in trust for the Persons entitled thereto (but reserving to the Fiduciary
  or to the Fiduciary and the Corporation, as the Corporation may determine, absolute
  investment discretion with respect thereto) and the sale thereof and remittance
  of the proceeds of such sale, if any, to the Persons entitled thereto. In no
  event has the Corporation or the Rights Agent an obligation to issue or deliver
  Rights or securities issuable on exercise of Rights to Persons who are citizens,
  residents or nationals of any jurisdiction other than Canada and the United
  States, in which jurisdiction such issue or delivery would be unlawful without
  registration of the relevant Persons, securities or issue or delivery for such
  purposes. 

	5.9 	Notices 

                    Any
  notice, demand or other communication required or permitted to be given or made
  by the Rights Agent or by the holder of any Rights to or on the Corporation
  or by the Corporation or by the holder of any Rights to or on the Rights Agent
  shall be in writing and shall be well and sufficiently given or made if: 

	 	(i) 	
      delivered in person during normal business hours on a
      Business Day and left with the receptionist or other responsible employee
      at the relevant address set forth below; or

	 	 	 
	 	(ii) 	
      except during any general interruption of postal services
      due to strike, lockout or other cause, sent by first-class mail;
  or

	 	 	 
	 	(iii) 	
      sent by telegraph, facsimile or other form of recorded
      electronic communication, charges prepaid and confirmed in writing as
      aforesaid;

- 28 - 

if to the Corporation, addressed to it at: 

Suite 1020 – 800 West Pender Street

Vancouver, British Columbia V6C 2V6 

Attention: Corporate Secretary 
Fax
No. (604) 681-2741 

and if to the Rights Agent, addressed to it at: 

3rd Floor, 510 Burrard
Street 
Vancouver, British Columbia V6C 3B9 

Attention: General Manager, Client
Services 
Fax No. (604) 661-9401 

Notices, demands or other communications required or permitted
to be given or made by the Corporation or the Rights Agent to or on the holder
of any Rights shall be in writing and shall be well and sufficiently given or
made if delivered personally to such holder or delivered or mailed by first
class mail to the address of such holder as it appears on the Rights Register
maintained by the Rights Registrar, or, prior to the Separation Time, in the
register of Shareholders maintained by the transfer agent for the Common Shares.

                    Any
  notice so given or made shall be deemed to have been given and to have been
  received on the day of delivery, if so delivered; on the third Business Day
  (excluding each day during which there exists any general interruption of postal
  service due to strike, lockout, or other cause) following the mailing thereof,
  if so mailed; and on the day of telegraphing, telecopying or sending of the
  same by other means of recorded electronic communication (provided such sending
  is during the normal business hours of the addressee on a Business Day and if
  not, on the first Business Day thereafter). Each of the Corporation and the
  Rights Agent may from time to time change its address for notice by notice to
  the other given in the manner aforesaid. 

	5.10 	Costs of Enforcement

                    The
  Corporation agrees that if the Corporation fails to fulfill any of its obligations
  pursuant to this Agreement, then the Corporation shall reimburse the holder
  of any Rights for the costs and expenses (including reasonable legal fees) incurred
  by such holder and actions to enforce his rights pursuant to any Rights or this
  Agreement. 

	5.11 	Successors 

                    All
  the covenants and provisions of this Agreement by or for the benefit of the
  Corporation or the Rights Agent shall bind and inure to the benefit of their
  respective successors and permitted assigns hereunder. 

	5.12 	Benefits of this Agreement

                    Nothing
  in this Agreement shall be construed to give to any Person other than the Corporation,
  the Rights Agent and the holders of the Rights any legal or equitable right,
  remedy or claim under this Agreement; but this Agreement shall be for the sole
  and exclusive benefit of the Corporation, the Rights Agent and the holders of
  the Rights. 

	5.13 	Governing Law 

                    This
  Agreement and each Right issued hereunder shall be deemed to be a contract made
  under the laws of the Province of British Columbia and for all purposes shall
  be governed by and construed in accordance with the laws of such Province applicable
  to contracts to be made and performed entirely within such Province. 

- 29 - 

	5.14 	Counterparts 

                    This
  Agreement may be executed in any number of counterparts and each of such counterparts
  shall for all purposes be deemed to be an original, and all such counterparts
  shall together constitute but one and the same instrument. 

	5.15 	Severability 

                    If
  any term or provision hereof or the application thereof to any circumstance
  shall, in any jurisdiction and to any extent, be invalid or unenforceable, such
  term or provision shall be ineffective as to such Jurisdiction to the extent
  of such invalidity or unenforceability without invalidating or rendering unenforceable
  the remaining terms and provisions hereof or the application of such term or
  provision to circumstances other than those as to which it is held invalid or
  unenforceable. 

	5.16 	Determinations and Actions by the Board of
      Directors 

                    All
  actions, calculations and determinations (including all omissions with respect
  to the foregoing) in connection with the administration of this Agreement which
  are done or made by the Board of Directors, in good faith, shall not subject
  the Board of Directors to any liability to the holders of the Rights. 

	5.17 	Regulatory Approvals

                    Any
  obligation of the Corporation or action or event contemplated by this Agreement,
  or any amendment or supplement to this Agreement, shall be subject to receipt
  of any requisite approval or consent from any governmental or regulatory authority
  having jurisdiction including The Toronto Stock Exchange while any securities
  of the Corporation are listed and posted for trading thereon and for a period
  of six months thereafter. 

                    IN
  WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed
  as of the date first above written. 

	 	TASEKO MINES LIMITED 
	 	 	 
	 	By: 	 
	 	 	 
	 	By: 	 
	 	 	 
	 	COMPUTERSHARE INVESTOR SERVICES
      INC. 
	 	 	 
	 	By: 	 
	 	 	 
	 	By: 	 

- 30 - 

EXHIBIT A 

[Form of Rights Certificate] 

	Certificate No. 	________________ Rights 

THE RIGHTS ARE SUBJECT TO REDEMPTION ON
THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. UNDER CERTAIN CIRCUMSTANCES
(SPECIFIED IN THE RIGHTS AGREEMENT), RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING
PERSON OR ANY PERSON ACTING JOINTLY OR IN CONCERT WITH AN ACQUIRING PERSON OR
WITH AN ASSOCIATE OR AFFILIATE OF AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED
IN THE RIGHTS AGREEMENT) OR TRANSFEREES OF ANY OF THE FOREGOING WILL BECOME VOID
WITHOUT FURTHER ACTION. 

RIGHTS CERTIFICATE 

                    This
  certifies that ______________________, or registered assigns, is the registered
  holder of the number of Rights set forth above, each of which entitles the registered
  holder thereof, subject to the terms, provisions and conditions of a Rights
  Agreement, dated effective as of February 13, 2007 (the “Rights Agreement”)
  between Taseko Mines Limited, a corporation incorporated under the Business
  Corporations Act (British Columbia) (the “Corporation”),
  and Computershare Investor Services Inc., as Rights Agent, to purchase
  from the Corporation at any time after the Separation Time and prior to the
  Expiration Time (as such terms are defined in the Rights Agreement), one fully
  paid common share in the capital of the Corporation (a “Common Share”)
  (subject to adjustment as provided in the Rights Agreement) at the Exercise
  Price referred to below, upon presentation and surrender of this Rights Certificate
  with a duly completed and executed Form of Election to Exercise at the principal
  office of the Rights Agent in any of the Cities of Toronto or Vancouver, Canada.
  The Exercise Price shall initially be $[] per right and shall be subject to adjustment
  in certain events as provided in the Rights Agreement. 

                    This
  Rights Certificate is subject to all the terms, provisions and conditions of
  the Rights Agreement which terms, provisions and conditions are hereby incorporated
  herein by this reference and made a part hereof and to which Rights Agreement
  reference is hereby made for a full description of the rights, limitations of
  rights, obligations, duties and immunities thereunder of the Rights Agent, the
  Corporation and the holders of the Rights Certificates. Copies of the Rights
  Agreement are on file at the registered office of the Corporation and are available
  upon written request.

                    This
  Rights Certificate, with or without other Rights Certificates, upon surrender
  at any office of the Rights Agent or any Co-Rights Agent designated for such
  purpose, may be exchanged for another Rights Certificate or Rights Certificates
  of like tenor and date evidencing an aggregate number of Rights equal to the
  aggregate number of Rights evidenced by the Rights Certificate or Rights Certificates
  so surrendered. If this Rights Certificate shall be exercised in part, the registered
  holder shall be entitled to receive, upon surrender hereof, another Rights Certificate
  or Rights Certificates for the number of whole Rights not exercised. 

                    Subject
  to the provision of the Rights Agreement, the Rights evidenced by this Certificate
  may be redeemed by the Corporation at a redemption price of $0.0001 per Right.

                    No
  fractional Common Shares will be issued upon the exercise of any Right or Rights
  evidenced hereby nor will Rights Certificates be issued for less than one whole
  Right. In lieu thereof, a cash payment will be made as provided in the Rights
  Agreement. 

                    No
  holder of this Rights Certificate, as such, shall be entitled to vote or receive
  dividends or be deemed for any purpose the Holder of Common Shares or of any
  other securities which may at any time be issuable on the exercise hereof, nor
  shall anything contained in the Rights Agreement or herein be construed to confer
  upon the holder hereof, as such, any of the rights of a shareholder of the Corporation
  or any right to vote for the election of directors or upon any matter submitted
  to shareholders at any meeting thereof, or to give or withhold consent to 

any corporate action, or to receive notice of meetings or other
actions affecting shareholders (except as provided in the Rights Agreement), or
to receive dividends or subscription rights, or otherwise, until the Rights
evidenced by this Rights Certificate shall have been exercised as provided in
the Rights Agreement. 

                    This
  Rights Certificate shall not be valid or obligatory for any purpose until it
  shall have been countersigned by the Rights Agent. 

                    WITNESS
  the facsimile signature of the proper officers of the Corporation and its corporate
  seal. 

	Date: _________________	 
	 	 
	ATTEST: 	 
	 	 
	TASEKO MINES LIMITED 	 
	 	 
	By: 	 	 
	  	 
	COMPUTERSHARE INVESTOR SERVICES
      INC. 	 
	 	 
	By: 	 	 
	     	Authorized Signatory 	 

[Form of Reverse Side of Rights Certificate] 

FORM OF ASSIGNMENT 

(To be executed by the registered holder if such 
holder
desires to transfer the Rights Certificates.) 

	FOR VALUE RECEIVED ____________________________________________________________________
	hereby sells, assigns and transfers 
	 
	unto ___________________________________________________________________________________
	 
	 
	                 
                           (Please
      print name and address of transferee) 

this Rights Certificate, together with all right, title and
interest therein, and does hereby irrevocably constitute and appoint
_____________________________ Attorney, to transfer the within Rights
Certificate on the books of the within-named Corporation, with full power of
substitution. 

	Dated: ___________________________________
	  
	  
	Signature Guaranteed: 
	                                                                                                                                    
      ________________________________________
	             
                         
                         
                         
                         
                         
                       
       Signature 
	             
                         
                         
                         
                         
                         
                       
       (Signature must correspond to name as written upon the 
	             
                         
                         
                         
                         
                         
                         face
      of this Rights Certificate in every particular, 
	             
                         
                         
                         
                         
                         
                       
       without alteration or enlargement or any change 
	             
                         
                         
                         
                         
                         
                       
       whatsoever) 

                    Signatures
  must be medallion guaranteed by a member firm of a recognized stock exchange
  in Canada or a registered national securities exchange in the United States,
  a member of the National Association of Securities Dealers, Inc., or a commercial
  bank or trust company having an office or correspondent in Canada or the United
  States. 

(To be completed if true) 

CERTIFICATION 

                    The
  undersigned hereby represents and certifies, for the benefit of all holders
  of Rights and Common Shares, that the Rights evidenced by this Rights Certificate
  are not, and, to the knowledge of the undersigned, have not been, Beneficially
  Owned by an Acquiring Person or any Person acting jointly or in concert with
  any Acquiring Person or with any Affiliate or Associate thereof (all as defined
  in the Rights Agreement). 

	 	 
	 	Signature 

NOTICE 

                    In
  the event the certification set forth above is not completed in connection with
  a purported assignment, the Beneficial Owner of the Rights evidenced by this
  Rights Certificate will be deemed to be an Acquiring Person or a Person acting
  jointly or in concert with such Acquiring Person or an Affiliate or Associate
  of such Acquiring Person (all as defined in the Rights Agreement) and accordingly
  the Rights evidenced by this Rights Certificate will be null and void. 

[To be attached to each Rights Certificate] 

FORM OF ELECTION TO EXERCISE 

(To be executed if holder desires to exercise the Rights
Certificate.) 

TO: 

	
                           
      The undersigned hereby irrevocably elects to exercise whole Rights
      represented by the attached Rights Certificate to purchase the Shares
      issuable upon the exercise of such Rights and requests that certificates
      for such Shares be issued in the name of: 

	
	
	  	  
	Address: 	  
	  	  
	  	  
	  	  
	  	  
	Social Insurance, Social Security or 	  
	Other Taxpayer Identification Number: __________________________________________________________________
	  	  
	
      If such number of Rights shall not be all the whole
      Rights evidenced by this Rights Certificate, a new Rights Certificate for
      the balance of such whole Rights shall be registered in the name of and
      delivered to: 

		  
	  	  
	  	  
	Address: 	  
	  	  
	  	  
	  	  
	  	  
	Social Insurance, Social Security or 	  
	Other Taxpayer Identification Number: __________________________________________________________________	  

	Dated: __________________________________________
	  
	Signature Guaranteed: 
	                                                                                                                                     _____________________________________
	                 
                           
                           
                           
                           
                           
           Signature 
	                 
                           
                           
                           
                           
                           
           (Signature must correspond to name as written upon the
    
	                 
                           
                           
                           
                           
                           
           face of this Rights Certificate in every particular,
    
	                 
                           
                           
                           
                           
                           
           without alteration or enlargement or any change 
	                 
                           
                           
                           
                           
                           
           whatsoever) 

                    Signatures
  must be medallion guaranteed by a member firm or a recognized stock exchange
  in Canada or a registered national securities exchange in the United States,
  a member of the National Association of Securities Dealers, Inc., or a commercial
  bank or trust company having an office or correspondent in Canada or the United
  States. 

(To be completed if true) 

CERTIFICATION 

                    The
  undersigned hereby represents, for the benefit of all holders of Rights and
  Shares, that the Rights evidenced by this Rights Certificate are not, and, to
  the knowledge of the undersigned, have never been, Beneficially Owned by an
  Acquiring Person or any Person acting jointly or in concert with any Acquiring
  Person or with any Affiliate or Associate thereof (all as defined in the Rights
  Agreement). 

	 	 
	 	Signature 

NOTICE 

                    In
  the event the certification set forth above is not completed in connection with
  a purported exercise, the Beneficial Owner of the Rights evidenced by this Rights
  Certificate will be deemed to be an Acquiring Person or a Person acting jointly
  or in concert with an Acquiring Person or an Affiliate or Associate of an Acquiring
  Person (all as defined in the Rights Agreement) and accordingly will deem the
  Rights evidenced by this Rights Certificate will be null and void.Filed by Automated Filing Services Inc. (604) 609-0244 - Lincoln Gold Corp. - Exhibit 10.1

EXHIBIT 10.1

OPTION AGREEMENT BUFA PROPERTY

THIS AGREEMENT is dated for reference the 12th day
of April, 2007.

BETWEEN:

ALMADEN MINERALS LTD. (“Almaden”),
a body corporate amalgamated under the laws of British Columbia, having an
office at 1103 – 750 West Pender Street, Vancouver, B.C. V6C 2T8 and MINERA
GAVILAN, S.A. de C.V. (“Minera”), a Mexican Incorporated, and wholly owned
subsidiary of Almaden with an office at Ricardo Flores Magon 67, Int. 8-N
Colonia Centro, Parral, Chihuahua 33800, Mexico

(Collectively, the “ Optionors” or
“Optionor”)

OF THE FIRST PART

AND

LINCOLN GOLD CORP. (“Lincoln
”), a body incorporated pursuant to the laws of Nevada, and having an office
at 325 Tahoe Drive, Carson City Nevada 89703

(the "Optionee")

OF THE SECOND PART

WHEREAS:

	A. 	
      The Optionor is the legal and beneficial owner of the
      claims, which are located in the State of Chihuahua Mexico and are
      collectively generally known and described as the "Bufa
  Property";

	 	 
	B. 	
      The Optionors have agreed to grant an option to the
      Optionee to acquire up to a 60% interest in the Property in consideration
      of the Optionee undertaking a work program on the Property aggregating
      US$3,500,000 and issuing an aggregate of 1,550,000 shares of the Optionee
      to Almaden as set forth herein; and

	 	 
	C. 	
      The Optionee is a OTCBB company;

                
NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of the sum of $10
now paid by the Optionee to the Optionors, the receipt and sufficiency of which
is hereby expressly acknowledged, and of the mutual promises, covenants,
conditions, representations and warranties herein set out, the parties hereto
agree as follows:

	1. 	
      INTERPRETATION

1.1     
      For the purposes of this Agreement,
including the recitals and any schedules hereto, unless there is something in
the subject matter or context inconsistent therewith, the following words and
expressions shall have the following meanings:

	 	(a) 	
      "Agreement" means this Agreement, as amended from time to
      time;

	 	 	 	 
	 	(b) 	
      “Area of Interest” means that area within 2 kilometers
      from the boundary of any of the claims comprising the Property;

	 	 	 	 
	 	(c) 	
      “Environmental Claims” means any and all administrative,
      regulatory or judicial actions, suits, demands, claims, liens, notices of
      non-compliance or violation, investigations or proceedings relating in any
      way to any Environmental Law or any permit issued under any such
      Environmental Law, including, without limitation:

	 	 	 	 
	 		(i) 	
      any and all claims by governmental or regulatory
      authorities for enforcement, clean-up, removal, response, remedial or
      other actions or damages pursuant to any applicable Environmental Law;
      and

	 	 	 	 
	 		(ii) 	
      any and all claims by any third party seeking damages,
      contribution, indemnification, cost recovery, compensation or injunctive
      or other relief resulting from hazardous materials, including any release
      thereof, or arising from alleged injury or threat of injury to human
      health or safety (arising from environmental matters) or the
      environment;

	 	 	 	 
	 	(d) 	
      “Environmental Law” means all requirements of the common
      law, civil code or of environmental, health or safety statutes,
      regulations, rules, ordinances, policies, orders, approvals, notices,
      licenses, permits or directives of any federal, state, territorial,
      provincial or local judicial, regulatory or administrative agency, board
      or governmental authority including, but not limited to those relating to
      (i) noise, (ii) pollution or protection of the air, surface water, ground
      water or land, (iii) solid, gaseous or liquid waste generation, handling,
      treatment, storage, disposal or transportation, (iv) exposure to hazardous
      or toxic substances, or (v) the closure, decommissioning, dismantling or
      abandonment of any facilities, mines or workings and the reclamation or
      restoration of lands;

	 	 	 	 
	 	(e) 	
      “Effective Date” means the date on which this agreement
      is executed and delivered ;

	 	 	 	 
	 	(f) 	
      "Mining Work" means every kind of work done on or in
      respect of the Property or the products there from by or under the
      direction of or on behalf of or for the benefit of a party and, without
      limiting the generality of the foregoing, includes assessment work,
      geophysical, geochemical and geological surveying, studies and mapping,
      investigating, drilling, designing, examining, equipping, improving,
      surveying, shaft sinking, raising, crosscutting and drifting, searching
      for, digging, trucking, sampling, working and procuring minerals, ores,
      metals and concentrates, surveying and bringing any mineral claims or
      other interests to lease or patent, reporting and all other work usually
      considered to be prospecting, exploration, development and mining
    work;

	 	 	 	 
	 	(g) 	
      "Option" means the sole and exclusive right and option to
      acquire and undivided 60% legal and beneficial interest in the
      Property;

2

	 	(h) 	
      "Property" means those mineral properties more
      particularly described in Schedule "A" hereto together with any surface
      rights, mineral rights, personal property and permits associated
      therewith, and shall include any renewal thereof and any other form of
      successor or substitute title thereto.

1.2            In
this Agreement, all dollar amounts are expressed in lawful currency of the
United States of America.

1.3            The
titles to the respective Articles hereof shall not be deemed to be a part of
this Agreement but shall be regarded as having been used for convenience
only.

1.4            Words
used herein importing the singular number shall include the plural, and
vice-versa, and words importing the masculine gender shall include the feminine
and neuter genders, and vice-versa, and words importing persons shall include
firms, partnerships and corporations.

	2. 	
      REPRESENTATIONS AND WARRANTIES

	 	 	 
	2.1 	
      The Optionee represents and warrants to the Optionors
      that:

	 	 	 
		(a) 	
      it has full power and authority to carry on its business
      and to enter into this Agreement and any agreement or instrument referred
      to in or contemplated by this Agreement;

	 	 	 
		(b) 	
      it has full power and has received full corporate
      authority for the execution, delivery and performance of this Agreement
      and the execution, delivery and performance of this Agreement and the
      consummation of the transactions herein contemplated will not conflict
      with, or accelerate the performance required by or result in any breach of
      any covenants or agreements contained in or constitute a default under, or
      result in the creation of any encumbrance, lien or charge under any
      indenture, agreement or other instrument whatsoever to which they are a
      party or by which they are bound or to which they may be subject and will
      not contravene any applicable laws;

	 	 	 
		(c) 	
      Any matters which arise which impede or delay the
      progress of work on the property by the Optionee or which may reasonably
      be anticipated to impede or delay the progress of work on the Property,
      for whatever cause, must be reported to the Optionor in a timely
      manner.

	 	 	 
	2.2 	
      The Optionors represent and warrant to the Optionee
      that:

	 	 	 
		(a) 	
      each has full legal capacity and competence to enter into
      this Agreement and any agreement or instrument referred to in or
      contemplated by this Agreement and to carry out and perform all of their
      obligations and duties hereunder;

	 	 	 
		(b) 	
      it has full power and authority for the execution,
      delivery and performance of this Agreement and the execution, delivery and
      performance of this Agreement and the consummation of the transactions
      herein contemplated will not conflict with, or accelerate the performance
      required by or result in any breach of any covenants or agreements
      contained in or constitute a default under, or result in the creation of
      any

3

			
      encumbrance, lien or charge under any indenture,
      agreement or other instrument whatsoever to which they are a party or by
      which they are bound or to which they may be subject and will not
      contravene any applicable laws;
	 
	 	 	 
		(c) 	
      Minera is the sole owner of, and holds good and
      marketable title to an undivided 100% right, title and interest in and to
      claims of the Property

	 	 	 
		(d) 	
      the Property is properly and accurately described in
      Schedule “A” hereto, and is in good standing under the laws of the
      jurisdiction in which the Property is located to and the conditions on and
      relating to the Property respecting all past and current operations
      thereon are to the best of its knowledge in compliance with all applicable
      federal and state laws including all Environmental Laws;

	 	 	 
		(e) 	
      all taxes, assessment, rentals, levies or other payments
      relating to the Property and required to be made to any federal and state
      governmental instrumentality have been made;

	 	 	 
	3. 	
      OPTION

3.1            The
Optionors hereby grant to the Optionee the sole and exclusive right and option
to acquire a 60% undivided interest in the Property by the making of
expenditures for Mining Work (“Expenditures”) and issuing shares of its capital
as follows:

	 	(a) 	
      the Optionee must spend US$500,000 in expenditures (which
      must include drilling) on the Property by the first anniversary of the
      Effective date (firm commitment);

	 	 	 
	 	(b) 	
      the Optionee makes Expenditures of an additional US$
      750,000 on the Property by the second anniversary of the Effective
      date;

	 	 	 
	 	(c) 	
      the Optionee makes Expenditures of an additional US$
      1,000,000 on the Property by the third anniversary of the Effective
      date;

	 	 	 
	 	(d) 	
      the Optionee makes Expenditures an additional US$
      1,250,000 on the Property by the fourth anniversary of the Effective
      date;

	 	 	 
	 	(e) 	
      the Optionee issues 150,000 common shares of the Optionee
      to Almaden within 5 business days of the Effective Date(firm
      commitment);

	 	 	 
	 	(f) 	
      the Optionee issues an additional 200,000 shares of the
      Optionee to Almaden on or before the first anniversary of the Effective
      date

	 	 	 
	 	(g) 	
      the Optionee issues an additional 200,000 shares of the
      Optionee to Almaden on or before the second anniversary of the Effective
      date;

	 	 	 
	 	(h) 	
      the Optionee issues an additional 1,000,000 shares of the
      Optionee to Almaden on or before the fourth anniversary of the Effective
      date;

4

Any Expenditures in excess of the Expenditures for such period
shall be credited towards the Expenditures required for a succeeding period or
periods.

The shares to fulfill the Share requirements set forth in
section 3.1 (e) to 3.1 (h) shall be issued to Almaden. The Optionee shall use
its best endeavours to ensure that all shares are issued without restriction on
transfer or if issued with restriction on transfer that such restrictions are
removed as soon as possible.

Almaden agrees that, in order to enable the Optionee to comply
with applicable United States securities laws, each issuance of Shares to
Almaden will be conditional upon execution by Almaden in favour of the Optionee
of an Investment Agreement in the form attached hereto as Schedule C in respect
of the issuance of Shares.

	4. 	
      OPTION EXERCISE

4.1            Upon
the fulfillment of the Expenditure requirements and the share requirements as
set forth in section 3.1 the Optionee shall be deemed to have earned an
undivided 60% interest in the Property (the “Option Exercise”), subject always
to compliance with the provisions of Section 6.3 (h).

	5. 	
      OPTIONEE’S RIGHTS

5.1            Except
as otherwise provided in this Agreement, until the Option is exercised or
terminated in accordance with the terms of this Agreement, the Optionee, its
servants and agents shall have the sole and exclusive right to:

	 	(a) 	
      enter in, under or upon the Property and conduct Mining
      Work;

	 	 	 
	 	(b) 	
      exclusive and quiet possession of the Property;

	 	 	 
	 	(c) 	
      bring upon the Property and to erect thereon such mining
      facilities as it may consider advisable; and

	 	 	 
	 	(d) 	
      remove from the Property and dispose of for its own
      account ore or mineral products for the purpose of bulk sampling, pilot
      plant or test operations.

	6. 	
      POWERS, DUTIES AND OBLIGATIONS OF
  OPTIONEE

6.1            Until
the Option is exercised or terminated in accordance with the terms of the
Agreement, the Optionee shall have full right, power and authority to do
everything necessary or desirable to carry out an exploration program on the
Property and to determine the manner of exploration and development of the
Property and, without limiting the generality of the foregoing, the right, power
and authority to:

	 	(a) 	
      regulate access to the Property, subject only to the
      right of the Optionors and its representatives to have access to the
      Property at all reasonable times for the purpose of inspecting work being
      done thereon but at their own risk and expense;

5

	 	(b) 	
      employ and engage such employees, agents and independent
      contractors as it may consider necessary or advisable to carry out its
      duties and obligations hereunder and in this connection to delegate any of
      its powers and rights to perform its duties and obligations hereunder;
      and

	 	 	 
	 	(c) 	
      execute all documents, deeds and instruments, do or cause
      to be done all such acts and things and give all such assurances as may be
      necessary to maintain good and valid title to the Property and each party
      hereby irrevocably constitutes the Optionee its true and lawful attorney
      to give effect to the foregoing and hereby agrees to indemnify and save
      the Optionee harmless from any and all costs, loss or damage sustained or
      incurred without gross negligence or bad faith by the Optionee directly or
      indirectly as a result of its exercise of its powers pursuant to this
      Subsection 6.1(c).

6.2            In
the event of any subdivision, consolidation or other change in the share capital
of the Optionee prior to the exercise in full of the Option, the number of
shares to be delivered or issued to the Optionor thereafter in connection with
the exercise of the Option shall be adjusted in accordance with such
subdivision, consolidation or other change in the share capital of the Optionee.
In the event the Optionee undertakes an amalgamation, merger, reorganization or
other arrangement prior to the exercise in full of the Option, the number of
shares to be delivered or issued to the Optionor thereafter shall be adjusted in
accordance with such amalgamation, merger, reorganization or other
arrangement.

6.3            Until
the Option is exercised or terminated in accordance with the terms of this
Agreement, the Optionee shall have the duties and obligations to:

	 	(a) 	
      Keep the Property free and clear of all liens and
      encumbrances arising from its operations hereunder (except liens contested
      in good faith by the Optionee)

	 	 	 
	 	(b) 	
      Keep the Property in good standing by the doing and
      filing, or payment in lieu thereof, of all necessary assessment work and
      payment of all taxes required to be paid and by the doing of all other
      acts and things and the making all other payments required to be made
      which may be necessary in that regard, and shall provide to the Optionors
      proof of such filing and payment or payment in lieu not less than 30 days
      before the due date of such filing or payment ;

	 	 	 
	 	(c) 	
      Permit the Optionors and representatives, duly authorized
      in writing by them or either of them, access to all records prepared by
      the Optionee in connection with Mining Work. The Optionee shall prepare
      and deliver to the Optionor at reasonable intervals, but in any event not
      less frequently than once each calendar quarter, reports on all Mining
      Work conducted by the Optionee. A formal written report prepared by a
      qualified person under the meaning of National Instrument 43-101 is
      required by the Optionor no later than May 15th of each year, to detail
      and describe the work performed during the preceding 12 months; If the
      optionor terminates the agreement before this date, the report is required
      within 14 days of the notice of termination.

	 	 	 
	 	(d) 	
      Conduct all work on or with respect to the Property in a
      careful and minerlike manner and in accordance with the applicable laws of
      the jurisdiction in which the Property is

6

	 		
      located and indemnify and save the Optionor harmless from
      any and all claims, suits or actions made or brought against the Optionor
      as a result of work done by the Optionee on or with respect to the
      Property;

	 	 	 
	 	(e) 	
      Maintain true and correct books, accounts and records of
      operations hereunder.

	 	 	 
	 	(f) 	
      During the term of the Option, the Optionee shall pay all
      taxes, complete and file all assessment work and make all necessary
      payments and do such further and other acts as may be required to maintain
      the Property in good standing and shall not abandon or terminate the
      Option at any time less than 90 days prior to the date on which any act is
      required to maintain the Property in good standing.

	 	 	 
	 	(g) 	
      provide to the Optionor copies of all news releases and
      other continuous disclosure documents filed or disseminated by the
      Optionee under securities laws of Canada and such other jurisdictions to
      which the Optionee may be subject which releases or documents shall comply
      with appropriate disclosure standards including, without limitation, NI
      43-101..

	 	 	 
	 	(h) 	
      Within 30 days after the end of each period within which
      expenditures are required (“Qualifying Expenditures”) to be made by the
      Optionee to maintain this Option Agrement in good standing the Optionee
      and before earning an interest in accordance with the provisions of
      Sections 3.2 or 4.1 of this agreement, shall supply to the Optionor a
      geological or engineering report in writing reporting in detail as to the
      work conducted and a report of the Qualifying Expenditures made by the
      Optionee. Such report of Qualifying Expenditures shall, if required by the
      Optionors, be certified to by the Optionee’s auditors.. Should such
      reports not be provided or should such reports not demonstrate
      expenditures sufficient to meet the required expenditures for the period
      covered by such report this Option Agreement may on notice in accordance
      with Section16.1 terminate the Option and the Secondary Option., or, at
      the election of the Optionors, require additional Qualifying Expenditures
      to be made or require payment in lieu of such expenditures.
  

 

	7. 	
      JOINT VENTURE

	 	 
	7.1 	
      Upon the Optionee earning its interest under 3.2 all
      operations shall be conducted on a joint venture basis the basic terms of
      which venture shall be as set forth in Schedule “B” or such further or
      other terms as the parties may agree upon.

	 	 
	8. 	
      TERMINATION OF OPTION

8.1            In
the event of default in the performance of the requirements of Section 3.1,
then, subject to the provisions of Sections 8.2 and 16.1 of this Agreement, the
Option and this Agreement shall terminate.

8.2            The
Optionee shall have the right to terminate this Agreement by giving 30 days'
written notice of such termination to the Optionors and upon the effective date
of such termination this Agreement shall be of no further force and effect and
the Optionee will have no further obligation to issue any 

7

Shares or incur any further exploration expenditures on the
Property, except the Optionee shall be required to satisfy any requirements
which have accrued under the provisions of this Agreement which have not been
satisfied.

8.3            Notwithstanding
any other provisions of this Agreement, in the event of termination of this
Agreement, the Optionee shall:

	 	(a) 	
      deliver to the Minera on any and all reports, samples,
      drill cores and engineering data of any kind whatsoever pertaining to the
      Property or related to Mining Work which have not been previously
      delivered to the Optionor;

	 	 	 
	 	(b) 	
      upon notice from the Minera, remove all materials,
      supplies and equipment from the Property; provided however, that the
      Minera may retain ore and, at the cost of the Optionee, dispose of any
      such materials, supplies or equipment not removed from the Property within
      one hundred and eighty (180) days of receipt of such notice by the
      Optionee; and

	 	 	 
	 	(c) 	
      ensure that, at the effective date of termination of this
      Agreement, the Property is free and clear of all liens and encumbrances
      arising from its operations hereunder (except liens contested in good
      faith by the Optionee) and in good standing for at least the next ensuing
      12 months whether by having done and filed, or paid in lieu thereof, all
      assessment work necessary for that purpose.

	9. 	
      CONFIDENTIALITY

9.1            All
information and data concerning or derived from Mining Work shall be
confidential and, except to the extent required by law or by regulation of any
securities commission, stock exchange or other regulatory body, shall not be
disclosed to any person other than a party's professional advisors without the
prior written consent of the other party or parties, which consent shall not
unreasonably be withheld.

	10. 	
      NOTICE

10.1            Any
notice, direction, or other instrument required or permitted to be given under
this Agreement shall be in writing and shall be given by the delivery of same or
by mailing same by prepaid registered or certified mail or by sending same by
telegram, telex, telecommunication or other similar form of communication, in
each case addressed to the intended recipient at the address of the respective
party set out on the first page hereof.

10.2            Any
notice, direction, or other instrument aforesaid will, if delivered, be deemed
to have been given and received on the day it was delivered, and if mailed, be
deemed to have been given and received on the fifth business day following the
day of mailing, except in the event of disruption of the postal service in which
event notice will be deemed to be received only when actually received and, if
sent by telegram, telecommunication or other similar form of communication, be
deemed to have been given and received on the day it was actually received.

8

10.3 Any party may at any time give notice in writing to the
others of any change of address, and from and after the giving of such notice,
the address therein specified will be deemed to be the address of such party for
the purposes of giving notice hereunder.

	11. 	
      FURTHER ASSURANCES

11.1            Each
of the parties covenants and agrees, from time to time and at all times, to do
all such further acts and execute and deliver all such further deeds, documents
and assurances as may be reasonably required in order to fully perform and carry
out the terms and intent of this Agreement.

	12. 	
      AREA OF INTEREST

12.1            If
at any time during the subsistence of this Agreement either the Optionor or the
Optionee stakes any mineral property located wholly or partly within the Area of
Interest, such party give written notice of the acquisition of such Interest to
the other party within 30 days of the acquisition which sufficiently describes
the acquisition, including the cost thereof. Within 30 days of receiving such
notice the non-acquiring party shall notify the acquiring party in writing as to
whether or not it intends that the acquisition should become part of the
Property. If the non-acquiring party fails to so notify the acquiring party
within 30 days of receipt of the notice of the acquisition, then the acquisition
shall be for the sole interest of the acquiring party and not subject to the
terms of the option. 

12.2            If
the acquiring party is the Optionor and the Optionee has notified the Optionor
of its intention that the acquisition should become part of the Property, the
Optionee shall pay the Optionor within 30 days, the cost of acquisition. Upon
payment of the cost of the acquisition by the Optionee,Minera and Optionee shall
each become the beneficial owner of an interest in the acquisition (in the
proportions set forth in this option in effect at the date of the acquisition )
and the acquisition will become part of the option and is subject to the terms
of this option save and except for the provisions of this Article 12.

12.3            If
theacquiring party is the Optionee and the Optionor has notified the Optionee of
the intention that the acquisition should become part of the Property, Minera
and the Optionee shall each become beneficial owner of an interest in the
acquisition (in the proportions set forth in this option in effect at the date
of the acquisition ) and the acquisition shall become part of the option and
subject to the terms of the option, save and except for the provisions of this
Article 12.

12.4            If
an acquisition by the Optionee becomes part of the Property as provided for
herein, the cost of the acquisition shall be credited towards the expenditures
in Article 3. 

	13. 	
      TIME OF THE ESSENCE

	 	 
	13.1 	
      Time shall be of the essence in the performance of this
      Agreement.

9

	14. 	
      ENUREMENT

14.1            This
Agreement shall enure to the benefit of and be binding upon the parties and
their respective successors and permitted assigns.

	15. 	
      FORCE MAJEURE

15.1            No
party will be liable for its failure to perform any of its obligations under
this Agreement due to a cause beyond its reasonable control including, but not
limited to, acts of God, fire, storm, flood, explosion, strikes, lockouts or
other industrial disturbances, acts of public enemy, war, riots, laws, rules and
regulations or orders of any duly constituted governmental authority, or
non-availability of materials or transportation (each an "Intervening
Event").

15.2            All
time limits imposed by this Agreement will be extended by a period equivalent to
the period of delay resulting from an Intervening Event.

15.3            A
party relying on the provisions of Section 14.1 hereof, insofar as possible,
shall promptly give written notice to the other party of the particulars of the
Intervening Event, shall give written notice to all other parties as soon as the
Intervening Event ceases to exist, shall take all reasonable steps to eliminate
any Intervening Event and will perform its obligations under this Agreement as
far as practicable, but nothing herein will require such party to settle or
adjust any labour dispute or to question or to test the validity of any law,
rule, regulation or order of any duly constituted governmental authority or to
complete its obligations under this Agreement if an Intervening Event renders
completion impossible.

	16. 	
      DEFAULT

16.1            If
a party (the "Defaulting Party") is in default of any requirement herein set
forth, the party affected by such default (the "Non-Defaulting Party") shall
give written notice to all other parties within thirty (30) days of becoming
aware of such default, specifying the default, and the Defaulting Party shall
not lose any rights under this Agreement, nor shall the Agreement or the Option
terminate, nor shall the Non-Defaulting Party have any rights, remedies or cause
of action pursuant to this Agreement, or otherwise hereunder as a result of such
default, unless within ten (10) days after the giving of notice of default by
the Non-Defaulting Party, the Defaulting Party has failed to cure the default by
the appropriate performance, and if the Defaulting Party fails within such
period to cure such default, the Non-Defaulting Party shall only then be
entitled to seek any remedy it may have on account of such default.

10

	17. 	
      TRANSFERS

17.1            The
Optionee with the consent of the Optionors first had and obtained, such consent
to be not unreasonably withheld, may at any time during the Option Period sell,
transfer or otherwise dispose of all or any portion of its interest in the
Property and/or its rights and obligations under this Agreement; provided that
any purchaser, grantee or transferee of any such interest delivers to the
Optionors its agreement related to this Agreement and to the Property ,
containing:

(a) a covenant by such transferee to
perform all the obligations of the Optionee to be performed under this Agreement
in respect of the interest to be acquired by it from the Optionee to the same
extent as if this Agreement had been originally executed by such transferee as
principal obligant; and

(b) a provision subjecting any further
sale, transfer or other disposition of such interest in the Property and/or this
Agreement or any portion thereof to the restrictions contained in this
section;

and further provided that any shares delivered to the Optionor
in connection with the exercise of the Option must be shares of the Optionee,
unless otherwise agreed in writing by the Optionor.

1702            No
assignment by the Optionee of any interest less than its entire interest in this
Agreement shall, as between the Optionee and the Optionor, discharge it from any
of its obligations hereunder, but upon the transfer by the Optionee of the
entire interest at the time held by it in this Agreement (whether to one or more
transferees and whether in one or in a number of successive transfers), the
Optionee shall be deemed to be discharged from all obligations hereunder save
and except for obligations which arose prior to the date of transfer.

17.3            If
the Optionor or the Optionee (the "Vendor") should at any time after exercise of
the Option receive a bona fide offer from an independent third party (the
"Proposed Purchaser") dealing at arm's length with the Vendor to purchase all or
substantially all of its interest in and to the Property , which offer the
Vendor desires to accept, or if the Vendor intends to sell all or substantially
all of its interest in and to the Property , the Vendor shall first make an
offer (the "Offer") of such interest in writing to the other party (the
"Offeree") upon terms no less favourable than those offered by the Proposed
Purchaser or intended to be offered by the Vendor, as the case may be. 

17.4            Each
Offer shall specify the price and terms and conditions of such sale, the name of
the Proposed Purchaser (which term shall, in the case of an intended offer by
the Vendor, mean the person or persons to whom the Vendor intends to offer its
interest) and, if the offer received by the Vendor from the Proposed Purchaser
provides for any consideration payable to the Vendor or otherwise than in cash,
the Offer shall include the Vendor's good faith estimate of the cash equivalent
of the non-cash consideration. 

17.5           
If within a period of 60 days of the receipt of the Offer the Offeree notifies
the Vendor in writing that it will accept the same, the Vendor shall be bound to
sell such interest to the Offeree (subject as hereinafter provided with respect
to price) on the terms and conditions of the Offer. 

11

17.6            If
the Offer so accepted by the Offeree contains the Vendor's good faith estimate
of the cash equivalent consideration as aforesaid, and if the Offeree disagrees
with the Vendor's best estimate, the Offeree shall so notify the Vendor at the
time of acceptance and the Offeree shall, in such notice, specify what it
considers, in good faith, the fair cash equivalent to be and the resulting total
purchase price. 

17.7            If
the Offeree so notifies the Vendor, the acceptance by the Offeree shall be
effective and binding upon the Vendor and the Offeree and the cash equivalent of
any such non-cash consideration shall be determined by binding arbitration under
the Commercial Arbitration Act of British Columbia and shall be payable by the
Offeree, subject to prepayment as hereinafter provided, within 60 days following
its determination by arbitration; and the Offeree shall in such case pay to the
Vendor, against receipt of an absolute transfer of clear and unencumbered title
to the interest of the Vendor being sold, the total purchase price which is
specified in its notice to the Vendor and such amount shall be credited to the
amount determined following arbitration of the cash equivalent of any non-cash
consideration. 

17.8           
If the Offeree fails to notify the Vendor before the expiration of the time
limited therefor that it will purchase the interest offered, the Vendor may sell
and transfer such interest to the Proposed Purchaser at the price and on the
terms and conditions specified in the Offer for a period of 60 days, provided
that the terms of this paragraph shall again apply to such interest if the sale
to the Proposed Purchaser is not completed within the said 60 days. 

17.9            Any
sale hereunder shall be conditional upon the Proposed Purchaser delivering a
written undertaking to the Offeree, in form and substance satisfactory to its
counsel, to be bound by the terms and conditions of this Agreement.

	18. 	
      SEVERABILITY

18.1            If
any one or more of the provisions contained herein should be invalid, illegal or
unenforceable in any respect in any jurisdiction, the validity, legality and
enforceability of such provisions shall not in any way be affected or impaired
thereby in any other jurisdiction and the validity, legality and enforceability
of the remaining provisions contained herein shall not in any way be affected or
impaired thereby.

	19. 	
      AMENDMENT

19.1            This
Agreement may not be changed orally but only by an agreement in writing, signed
by the party against which enforcement, waiver, change, modification or
discharge is sought.

	20. 	
      ENTIRE AGREEMENT

20.1            This
Agreement constitutes and contains the entire agreement and understanding
between the parties and supersedes all prior agreements, memoranda,
correspondence, communications, negotiations and representations, whether oral
or written, express or implied, statutory or otherwise between the parties or
any of them with respect to the subject matter hereof. In particular, Almaden
agrees that the agreements of Lincoln as set forth in this Agreement replace and
supercede the obligations of Lincoln under the original letter of intent dated
August 5, 2005, including the obligations 

12

of Lincoln to issue to Almaden 70,000 shares on August 5, 2007,
80,000 shares on August 5, 2008 and 90,000 shares on August 5, 2009. 

	21. 	
      OPTION ONLY

21.1            This
Agreement provides for an option only, and except as specifically provided
otherwise, nothing herein contained shall be construed as obligating the
Optionee to do any acts or make any payments hereunder and any act or acts or
payment or payments as shall be made hereunder shall not be construed as
obligating the Optionee to do any further act or make any further payment.

	22. 	
      GOVERNING LAW AND
ARBITRATION

21.1            This
Agreement shall be governed by and interpreted in accordance with the laws of
the Province of British Columbia and the federal laws of Canada applicable
therein and the parties hereby irrevocably attorn to the jurisdiction of the
Courts and mediation/arbitral authorities of the Province of British
Columbia.

22.2            Any
  dispute arising between the parties shall if possible be settled by mediation.
  Failing resolution by mediation, the matter shall be determined by binding arbitration
  conducted under the Commercial Arbitration Act (British Columbia) and the place
  of arbitration shall be Vancouver, British Columbia.

   

THE COMMON SEAL of ALMADEN MINERALS LTD. 

  was hereto affixed in the presence of:

/s/ Morgan Poliquin 

  Authorized Signatory

 /s/ Duane Poliquin

  Authorized Signatory 

 

THE COMMON SEAL of MINERA GAVILAN, S.A. de C.V. 

  was hereto affixed in the presence of: 

	/s/ Morgan Poliquin

        Authorized Signatory

      /s/ Duane Poliquin

        Authorized Signatory 
	 C/S

13

THE COMMON SEAL of LINCOLN GOLD CORP. 

  was hereto affixed In the presence of: 

	/s/ Paul F. Saxton

        Authorized Signatory

      /s/ Andrew Milligan

        Authorized Signatory
	 C/S

 

14

SCHEDULE “A”

Claim Data

SCHEDULE "B"

JOINT VENTURE TERMS

	1. 	
      Participating Interests

	 	 	 
		
      Initial interests and initial investments of Almaden and
      the /Optionee will be as set forth in the Option agreement

	 	 	 
	2. 	
      Management Committee

	 	 	 
		
      The joint venture will be under the management of a
      management committee consisting of one representative of each participant
      and at least one alternate representative. A quorum for any Management
      Committee meeting shall be present if the representatives of all parties
      are present. The representative of the Operator shall be the chairman of
      Management Committee meetings. The Management Committee shall decide every
      question submitted to it by a vote with each representative being entitled
      to cast that number of votes which is equal to it’s party’s interest
      percentage. The Management committee shall make decisions by simple
      majority.

	 	 	 
	3. 	
      Operator

	 	 	 
		(a) 	
      The Optionee will be the first operator and remain so
      unless its interest is reduced below 50% or it resigns or is removed for
      default. Upon the Optionee ceasing as operator Almaden shall become
      operator failing which, the Management Committee shall thereupon select
      another party to become Operator.

	 	 	 
		(b) 	
      The non-operator may refer a question of operator default
      to arbitration if it is outvoted on a management committee motion to
      remove the operator for default.

	 	 	 
		(c) 	
      The operator must keep the property in good standing and
      free of encumbrances, comply with laws, and maintain proper books and
      accounts and adequate insurance.

	 	 	 
		(d) 	
      The operator must conduct joint venture activities
      according to approved programs and budgets, with sole responsibility for
      non-approved overruns exceeding 20% on exploration programs and 10% on
      development and other programs, and otherwise in accordance with good
      mining practices.

	 	 	 
		(e) 	
      The operator will have the right to cash call in advance
      to cover anticipated approved program expenditures, including a reasonable
      amount of working capital.

	 	 	 
		(f) 	
      The operator's charges for management will be: 10% of
      exploration costs, reduced to 5% on any single third party contract
      exceeding $50,000; 1% of construction costs; and 2% of mine operating
      costs. This charge is intended as a reimbursement of the costs of the time
      incurred by head office management and support functions in respect of
      approved programs on the Claims, which is not otherwise billed as a cost.
      The charge has been established as an estimate of anticipated management
      and administrative costs and on the basis that the party acting as
      Operator shall not profit nor suffer loss by virtue of acting in its
      capacity as Operator providing these services.

	 	 	 
		(g) 	
      After commencement of commercial production the operator
      will have a lien on the non operator’s interest to secure the non
      operator’s cost share of expenditures and the right to advance the cost
      share of a party in default, any such advances to be accounted for in
      dilution formulae outlined in Sections 5 (c) and 5 (d) of this
      Schedule.

 

-17-

	 	(h) 	
      Prior to a production decision, the operator will submit
      annual exploration programs for management committee approval, and will
      report on results on a quarterly basis.

	 	 	 
	 	(i) 	
      Unless a feasibility study was delivered prior to the
      formation of the joint venture, the Management Committee may approve a
      program which contemplates the preparation of a feasibility report at such
      time, if any, as it deems fit.

	 	 	 
	 	(j) 	
      A development program will be prepared by operator based
      on a feasibility study approved by the Management Committee.

	 	 	 
	 	(k) 	
      Each party must finance its own cost share of development
      costs, with the right to pledge its interest for such purpose.

	 	 	 
	 	(l) 	
      After commencement of commercial production, operator
      will submit annual operating programs for management committee
      approval.

	4. 	
      Participation in Programs and Dilution

	 	 	 	 
		(a) 	
      Parties will have an election as to whether to
      participate in any approved exploration program or approved development
      program up to the amount of its interest at such time.

	 	 	 	 
		(b) 	
      Electing to participate in an approved program will make
      a participant liable for its agreed cost share of all expenditures for
      that program.

	 	 	 	 
		(c) 	
      Electing not to participate in an approved program will
      result in dilution of interest, i.e. each party's interest will be
      calculated as follows:

	 	 	 	 
			
      AB + Y

			B + C
	 	 	 	 
			
      (Where:

	 	 	 	 
			A = the interest of the party being
      diluted prior to the start of the Relevant Program, as defined
below;

	 	 	 	 
			B = the sum of all deemed and prior contributions
      of all parties prior to the start of the Relevant Program;
	 	 	 	 
			Y = the actual contributions (if any) of the
      diluting party to the Relevant Program; and
	 	 	 	 
			C = the total amount actually contributed by all
      parties to the Relevant Program; and
	 	 	 	 
			
      “Relevant Program” means a program to which the
      diluting party elected not to contribute and the Program is subsequently
      funded by the other party increasing its contribution by the amount of the
      shortfall.) 

      and the contributing party's interest will be
      correspondingly increased.

	 	 	 	 
		(d) 	
      Notwithstanding (c) above, in the case of a development
      program which involves construction of mining facilities and bringing a
      mine to commercial production based on a feasibility study, a party
      electing to participate in such program in an amount less than its
      interest at the time (including not to participate at all) will result in
      dilution of such party's interest to that percentage of budgeted
      expenditures which it has agreed to contribute, subject to (f)
    below.

	 	 	 	 
		(e) 	
      Until commencement of commercial production, a
      participant’s failure to pay its cost share of an approved program after
      electing to participate will constitute default and result in double
      dilution of interest, i.e. the defaulting party's interest will
  be:

-18-

AB + Y
2[B + C]

(A, B, Y and C having the meanings
given above.)

and the non-defaulting party's
interest will be correspondingly increased.

After commencement of commercial
production, a participant’s failure to pay its cost share of an approved program
after electing to participate will constitute default and result in dilution of
interest, such that the defaulting party's interest will be:

AB + Y
B + 2C

(A, B, Y and C having the meanings
given above.)

and the non-defaulting party's
interest will be correspondingly increased.

	 	(f) 	
      Dilution to 10% will effect a deemed surrender of an
      interest in the joint venture, and conversion of such interest to a 2.0%
      net smelter royalty, which will be in a form to be agreed by the
      parties.

	5. 	
      Disposition of Production

	 	 	 
		(a) 	
      Each participant shall have the right to take its share
      of production in kind.

	 	 	 
		(b) 	
      The operator will be free to sell the share of production
      of any participant who fails to take its share in kind or make
      arrangements for sale, deducting its costs and expenses from the
      proceeds.

	 	 	 
	6. 	
      Transfers of Interests

	 	 	 
		(a) 	
      Any transfer of interest in the property and the joint
      venture agreement will be subject to a right of first offer of the other
      participant substantially in the form set forth in the Option Agreement
      under the heading “ Transfers”. Such a transfer cannot be made without the
      consent of the other party, which consent cannot be unreasonably withheld,
      and is subject to the transferee agreeing to be bound by the terms of the
      Joint Venture Agreement.

	 	 	 
		(b) 	
      No encumbrances of any interest will be permitted except
      for financing of development and then subject to the joint venture
      agreement.

	 	 	 
	7. 	
      Withdrawal and Winding Up

	 	 	 
		
      No withdrawal by a party or winding up of the joint
      venture will be permitted without adequate

	 	 	 
		
      payment of or security for reclamation and closure
      costs.

-19-

	8. 	
      Dispute Resolution

	 	 	 
		
      Arbitration administered by the British Columbia
      International Commercial Arbitration Centre.

	 	 	 
	9. 	
      Other

	 	 	 
		(a) 	
      Force majeure

	 	 	 
		(b) 	
      Confidentiality

	 	 	 
		(c) 	
      Subject to British Columbia
law.

-20-

SCHEDULE “C”

REGULATION S INVESTMENT AGREEMENT

WHEREAS:

A.            Lincoln
  Gold Corporation (the “Company”) has agreed to issue and Almaden Minerals
  Ltd. (the “Investor”) has agreed to accept • shares of the common
  stock of the Company (the “Shares”) as the issuance of securities
  dueu pursuant to an agreement dated •, 2007 between the Company and Almaden regarding
  the Bufa Property located in Chihuahua, Mexico (the “Bufa Agreement”);

B.            Almaden
is a resident of Canada; and

C.            The
Company has requested, as a condition of delivery of the Shares to Almaden, that
Almaden execute and deliver to the Company this Investment Agreement in order to
confirm that the Shares will be issued to Almaden pursuant to and in reliance of
the safe harbour from the registration requirements of the United States
Securities Act of 1933 (the “U.S. Securities Act”) provided by Rule 903 of
Regulation S of the U.S. Securities Act.

Almaden covenants, represents and warrants to the Company as
follows, and acknowledges that the Company is relying upon such covenants,
representations and warranties in connection with the completion of the issuance
of the Shares to Almaden:

	1. 	
      Almaden has such knowledge and experience in finance,
      securities, investments, including investment in non-listed and
      non-registered securities, and other business matters so as to be able to
      evaluate the merits and risks of an investment in the Company’s common
      stock and to otherwise protect its interests in connection with this
      transaction. Further, Almaden is an “accredited investor” as such term is
      defined in NI 45-106.

	 	 
	2. 	
      The Company has provided to Almaden the opportunity to
      ask questions and receive answers concerning the terms and conditions of
      the offering and it has had access to such information concerning the
      Company as it has considered necessary or appropriate in connection with
      its investment decision to enter into the Bufa Agreement.

	 	 
	3. 	
      Almaden is acquiring the Shares for its own account, for
      investment purposes only and not with a view to any resale, distribution
      or other disposition of the Shares in violation of the United States
      securities laws.

	 	 
	4. 	
      Almaden understands the Shares have not been and will not
      be registered under the U.S. Securities Act or the securities laws of any
      state of the United States and that the sale contemplated hereby is being
      made in reliance on an exemption from such registration
    requirements.

	 	 
	5. 	
      Almaden has not acquired the Shares as a result of any
      form of general solicitation or general advertising, including
      advertisements, articles, notices or other communications published in any
      newspaper, magazine or similar media or broadcast over radio, television
      or other form of telecommunications, or any seminar or meeting whose
      attendees have been invited by general solicitation or general
      advertising.

-21-

	6. 	
      Almaden understands that the Shares are “restricted
      securities” under the U.S. Securities Act and that the Company has no
      obligation to register any of the Shares pursuant to the U.S. Securities
      Act.

	 	 	 
	7. 	
      Almaden acknowledges and agrees that all certificates
      representing the Shares will be endorsed with the following legend in
      accordance with the U.S. Securities Act or such similar legend as deemed
      advisable by the lawyers for the Company to ensure compliance with the
      U.S. Securities Act:

	 	 	 
		
      “THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE
      NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "ACT"), AND HAVE
      BEEN ISSUED IN RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION
      REQUIREMENTS OF THE ACT PROVIDED BY REGULATION S PROMULGATED UNDER THE
      ACT. SUCH SECURITIES MAY NOT BE REOFFERED FOR SALE OR RESOLD OR OTHERWISE
      TRANSFERRED EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S,
      PURSUANT TO AN EFFECTIVE REGISTRATION UNDER THE ACT, OR PURSUANT TO AN
      AVAILABLE EXEMPTION FROM REGISTRATION UNDER THE ACT. HEDGING TRANSACTIONS
      INVOLVING THE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH
      THE ACT”.

	 	 	 
	8. 	
      If Almaden decides to offer, sell or otherwise transfer
      any of the Shares, it will not offer, sell or otherwise transfer any of
      such Shares directly or indirectly, unless:

	 	 	 
		(a) 	
      the sale is to the Company;

	 	 	 
		(b) 	
      the sale is made outside the United States in a
      transaction meeting the requirements of Regulation S under the U.S.
      Securities Act and in compliance with applicable local laws and
      regulations;

	 	 	 
		(c) 	
      the sale is made pursuant to the exemption from the
      registration requirements under the U.S. Securities Act provided by Rule
      144 thereunder and in accordance with any applicable state securities or
      “blue sky” laws; or

	 	 	 
		(d) 	
      the Shares are sold in a transaction that does not
      require registration under the U.S. Securities Act or any applicable state
      laws and regulations governing the offer and sale of securities,

	 	 	 
			
      and, in the cased of (b), (c) and (d), it has prior to
      such sale furnished to the Company an opinion of counsel reasonably
      satisfactory to the Company.

	 	 	 
	9. 	
      Almaden acknowledges and agrees that the Shares have been
      issued to Almaden in an “offshore transaction” within the meaning of
      Regulation S of the U.S. Securities Act and represents, warrants and
      agrees that:

	 	 	 
		(a) 	
      Almaden was not in the United States at the time the Bufa
      Agreement was executed.

	 	 	 
		(b) 	
      Almaden will not to engage in hedging transactions with
      regard to the Shares unless in compliance with the U.S. Securities
    Act.

	 	 	 
		(c) 	
      the Company will refuse to register any transfer of the
      Shares not made in accordance with the provisions of Regulation S of the
      U.S. Securities Act, pursuant to registration under the Securities Act,
      pursuant to an available exemption from
registration.

-22-

	 	(d) 	
      Almaden will resell the Shares only in accordance with
      the provisions of Regulation S of the Securities Act, pursuant to
      registration under the U.S. Securities Act, or pursuant to an available
      exemption from registration pursuant to the U.S. Securities Act.

	 	 	 
	 	(e) 	
      Almaden is not a “U.S. Person” as defined by Regulation S
      of the U.S. Securities Act, as set forth in Schedule A hereto, and is not
      acquiring the Shares for the account or benefit of a U.S.
  Person.

	10. 	
      Almaden consents to the Company making a notation on its
      records or giving instructions to any transfer agent of the Company in
      order to implement the restrictions on transfer set forth and described in
      this Investment Agreement.

This Investment Agreement is executed by Almaden effective as
  of the • day of •, 2007.

ALMADEN MINERALS LTD. 

  by its authorized signatory:

Signature:  ______________________________

  Name:         ______________________________

  Title:           ______________________________

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