Document:

EX 4.4

    EXHIBIT
      4.4

     

    THIS
      SECURITY HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF
      1933,
      AS AMENDED (THE "SECURITIES ACT"), AND ACCORDINGLY, MAY NOT BE OFFERED OR SOLD
      EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE
      HOLDER (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
      DEFINED IN RULE 144A ADOPTED UNDER THE SECURITIES ACT); (B) IT IS AN ACCREDITED
      INVESTOR (AS DEFINED IN REGULATION D UNDER THE SECURITIES ACT); OR (C) IT IS
      NOT
      A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN OFFSHORE TRANSACTION IN
      COMPLIANCE WITH REGULATION S ADOPTED UNDER THE SECURITIES ACT; (2) AGREES THAT
      IT WILL NOT RESELL OR OTHERWISE TRANSFER THE SECURITY EVIDENCED HEREBY OR THE
      COMMON SHARES ISSUABLE UPON CONVERSION OF SUCH SECURITY, EXCEPT (A) TO THE
      ISSUER OR A SUBSIDIARY THEREOF; (B) TO A QUALIFIED INSTITUTIONAL BUYER IN
      COMPLIANCE WITH RULE 144A ADOPTED UNDER THE SECURITIES ACT (IF AVAILABLE);
      (C)
      TO PERSONS OTHER THAN U.S. PERSONS OUTSIDE THE UNITED STATES IN COMPLIANCE
      WITH
      REGULATION S UNDER THE SECURITIES ACT; (D) PURSUANT TO THE EXEMPTION FROM
      REGISTRATION PROVIDED BY RULE 144 ADOPTED UNDER THE SECURITIES ACT OR ANOTHER
      AVAILABLE EXEMPTION UNDER THE SECURITIES ACT (IF AVAILABLE); OR (E) PURSUANT
      TO
      AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, AND (3) AGREES
      THAT IT WILL, PRIOR TO ANY TRANSFER OF THIS SECURITY, FURNISH TO THE ISSUER
      SUCH
      CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS MAY BE REQUIRED TO
      CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR
      IN A
      TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
      ACT.
      AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S.
      PERSON" HAVE THE MEANING GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES
      ACT.
      IN ANY CASE, THE HOLDER HEREOF WILL NOT, DIRECTLY OR INDIRECTLY, ENGAGE IN
      ANY
      HEDGING TRANSACTION WITH REGARD TO THIS SECURITY OR ANY COMMON SHARES ISSUABLE
      UPON CONVERSION OF SUCH SECURITY, EXCEPT AS PERMITTED BY THE SECURITIES
      ACT.

     

    THE
      COMMON SHARES TO BE ISSUED UPON CONVERSION OF THIS SECURITY WILL NOT BE
      INITIALLY REGISTERED AND MAY OR MAY NOT LATER BECOME REGISTERED FOR RESALE
      UNDER
      THE SECURITIES ACT. THE COMMON SHARES ISSUED UPON CONVERSION OF THIS SECURITY
      MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED
      UNLESS AND UNTIL REGISTERED UNDER THE SECURITIES ACT OR, IN THE OPINION OF
      COUNSEL TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE
      OR HYPOTHECATION IS IN COMPLIANCE WITH AN EXEMPTION FROM THE REGISTRATION
      REQUIREMENTS OF THE SECURITIES ACT.

     

    UNLESS
      PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY MUST NOT
      TRADE THE SECURITY BEFORE JUNE 24, 2007.

     

    Void
      after 5:00 p.m. (Toronto time) on the 23rd day of February, 2009.

     

     

    
      	
              Number
                of Compensation Warrants: l

            	
              Compensation
                Warrant Certificate No. 2007-01-l

            

    

     

    APOLLO
      GOLD CORPORATION

     

    (A
      corporation existing under the laws of the Yukon Territory)

     

    This
      is
      to certify that, for value received, l
      (the
      "Holder"),
      shall
      have the right to purchase from APOLLO GOLD CORPORATION (the "Corporation"),
      at
      any time and from time to time up to 5:00 p.m. (Toronto time) on February 23,
      2009 (the
      "Expiry
      Time"),
      one
      fully paid and non-assessable common share in the capital of the Corporation
      (a
      "Common
      Share")
      for
      each

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    Compensation
      Warrant (individually, a "Compensation
      Warrant")
      represented hereby at a price of US$0.50 per Common Share (the "Exercise
      Price"),
      upon
      and subject to the terms and conditions set forth herein.

     

    1.    For
      the
      purposes of this Compensation Warrant Certificate, the term "Common
      Shares"
      means
      common shares without par value in the capital of the Corporation as constituted
      as of the date hereof, provided that in the event of a subdivision, redivision,
      reduction, combination or consolidation thereof or any other adjustment under
      section 8 herein, or successive such subdivisions, redivisions, reductions,
      combinations, consolidations or other adjustments, then subject to the
      adjustments, if any, having been made in accordance with the provisions of
      this
      Compensation Warrant Certificate, "Common
      Shares"
      shall
      thereafter mean the shares, other securities or other property resulting from
      such subdivision, redivision, reduction, combination or consolidation or other
      adjustment.

     

    2.    All
      Compensation Warrant Certificates shall be signed by an officer of the
      Corporation holding office at the time of signing, or any successor or
      replacement of such person and notwithstanding any change in any of the persons
      holding said offices between the time of actual signing and the delivery of
      the
      Compensation Warrant Certificate, the Compensation Warrant Certificate so signed
      shall be valid and binding upon the Corporation.

     

    3.    All
      rights under any of the Compensation Warrants in respect of which the right
      of
      subscription and purchase therein provided for shall not theretofore have been
      exercised shall wholly cease and such Compensation Warrants shall be wholly
      void
      and of no valid or binding effect after the Expiry Time.

     

    4.    The
      right
      to purchase Common Shares of the Corporation pursuant to the Compensation
      Warrants may only be exercised by the Holder at or before the Expiry Time
      by:

     

    
      	 	
              (a)

            	
              duly
                completing and executing a subscription substantially in the form
                attached
                as Schedule "A" (the "Subscription
                Form"),
                in the manner therein indicated;
                and

            

    

     

    
      	 	
              (b)

            	
              surrendering
                this Compensation Warrant Certificate and the duly completed and
                executed
                Subscription Form to the Corporation prior to the Expiry Time at
                its
                principal office, 5655 S. Yosemite Street, Suite 200, Greenwood Village,
                Colorado, 80111-3220,
                together with payment of the purchase price for the Common Shares
                subscribed for in the form of certified cheque or bank draft payable
                to
                the Corporation in an amount equal to the then applicable Exercise
                Price
                multiplied by the number of Common Shares subscribed
                for.

            

    

     

    5.    Upon
      delivery and payment as set forth in section 4 herein, the Corporation shall
      cause to be issued to the Holder the number of Common Shares subscribed for
      by
      the Holder and the Holder shall become a shareholder of the Corporation in
      respect of such Common Shares with effect from the date of such delivery and
      payment and shall be entitled to delivery of a certificate or certificates
      evidencing such shares. The Corporation shall cause such certificate or
      certificates to be mailed to the Holder at the address or addresses specified
      in
      the Subscription Form within

    
      
        
          
          

        

        
          -2-

          
            

          

        

        
          
          

        

      

    

     

    five
      (5)
      business days of such delivery and payment as set forth in section 4 herein
      or,
      if so instructed by the Holder, held for pick-up by the Holder at the principal
      office of the Corporation. Notwithstanding any adjustment provided for in
      section 8 herein, the Corporation shall not be required upon the exercise of
      any
      Compensation Warrants to issue fractional Common Shares in satisfaction of
      its
      obligations hereunder and the Holder understands and agrees that it will not
      be
      entitled to any cash payment or other form of compensation in respect of a
      fractional Common Share that might otherwise have been issued; provided that
      any
      fractional Common Share of 0.5 or greater shall be rounded up to the next whole
      number and any fraction less than 0.5 shall be cancelled.

     

    6.    The
      holding of a Compensation Warrant shall not constitute the Holder a shareholder
      of the Corporation nor entitle him to any right or interest in respect thereof
      except as herein expressly provided.

     

    7.    The
      Corporation covenants and agrees that until the Expiry Time, while any of the
      Compensation Warrants shall be outstanding, it shall reserve and there shall
      remain unissued out of its authorized capital a sufficient number of Common
      Shares to satisfy the right of purchase herein provided, as such right of
      purchase may be adjusted pursuant to sections 8 and 9 herein. The Corporation
      further covenants and agrees that while any of the Compensation Warrants shall
      be outstanding, the Corporation shall (a) comply with the securities legislation
      applicable to it in
      order
      that the Corporation continue as a reporting issuer, or analogous
      entity,
      not in
      default of any requirements of such legislation; (b) use its commercially
      reasonable best efforts to do or cause to be done all things necessary to
      preserve and maintain its corporate existence; and (c) at its own expense
      expeditiously use its commercially reasonable best efforts to obtain the listing
      of such Common Shares (subject to issue or notice of issue) on each stock
      exchange or over-the-counter market on which the Corporation’s Common Shares may
      be listed from time to time. All Common Shares which shall be issued upon the
      exercise of the right to purchase herein provided for, upon payment therefor
      of
      the amount at which such Common Shares may at the time be purchased pursuant
      to
      the provisions hereof, shall be issued as fully paid and non-assessable shares
      and the holders thereof shall not be liable to the Corporation or its creditors
      in respect thereof.

     

    8.    (a)    For
      the
      purpose of this section 8, unless there is something in the subject matter
      or
      context inconsistent therewith, the words and terms defined below shall have
      the
      respective meanings specified therefor:

     

    "Current
      Market Price"
      of the
      Common Shares at any date means the price per share equal to the weighted
      average price at which the Common Shares have traded on the American Stock
      Exchange (the "AMEX")
      or, if
      the Common Shares are not then listed on the AMEX, on the Toronto Stock Exchange
      or, if the Common Shares are not then listed on any stock exchange, in the
      over-the-counter market, during the period of any twenty consecutive trading
      days ending not more than five (5) business days before such date; provided
      that
      the weighted average price shall be determined by dividing the aggregate sale
      price of all Common Shares

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

    sold
      on
      the said exchange or market, as the case may be, during the said twenty
      consecutive trading days by the total number of Common Shares so sold; and
      provided further that if the Common Shares are not then listed on any Canadian
      stock exchange or traded in the over-the counter market, then the Current Market
      Price shall be determined by such firm of independent chartered accountants
      as
      may be selected by the directors of the Corporation;

     

    "director"
      means a
      director of the Corporation for the time being and, unless otherwise specified
      herein, a reference to action "by the directors" means action by the directors
      of the Corporation as a board or, whenever empowered, action by the executive
      committee of such board; and

     

    "trading
      day"
      with
      respect to a stock exchange or over-the-counter market means a day on which
      such
      stock exchange or market is open for business.

     

    
      	
            	(b)	
              If
                and whenever at any time after the date hereof and prior to the Expiry
                Time the Corporation shall (i) subdivide or redivide its then outstanding
                Common Shares into a greater number of Common Shares, (ii) reduce,
                combine
                or consolidate its then outstanding Common Shares into a lesser number
                of
                Common Shares or (iii) issue Common Shares (or securities exchangeable
                for
                or convertible into Common Shares) to the holders of all or substantially
                all of its then outstanding Common Shares by way of a stock dividend
                or
                other distribution (any of such events herein called a "Common
                Share Reorganization"),
                then the Exercise Price shall be adjusted effective immediately after
                the
                effective date of any such event in (i) or (ii) above or the record
                date
                at which the holders of Common Shares are determined for the purpose
                of
                any such dividend or distribution in (iii) above, as the case may
                be, by
                multiplying the Exercise Price in effect on such effective date or
                record
                date, as the case may be, by a fraction, the numerator of which shall
                be
                the number of Common Shares outstanding on such effective date or
                record
                date, as the case may be, before giving effect to such Common Share
                Reorganization and the denominator of which shall be the number of
                Common
                Shares outstanding immediately after giving effect to such Common
                Share
                Reorganization including, in the case where securities exchangeable
                for or
                convertible into Common Shares are distributed, the number of Common
                Shares that would be outstanding if such securities were exchanged
                for or
                converted into Common Shares.

            

    

     

    
      	
            	(c)	
              If
                at any time after the date hereof and prior to the Expiry Time the
                Corporation shall fix a record date for the issue or distribution
                to the
                holders of all or substantially all of the outstanding Common Shares,
                of
                rights, options or warrants pursuant to which such holders are entitled,
                during a period expiring not more than 45 days after the record date
                for
                such issue (such period being the "Rights
                Period"),
                to subscribe for or purchase Common Shares or securities exchangeable
                for
                or convertible into Common Shares at a price per share (or in the
                case of
                securities exchangeable for or convertible into Common Shares at
                an
                exchange or conversion price per share at the date of issue of such
                securities) of less than 95% of the Current Market Price of the Common
                Shares on such record date (any of such events being herein called
                a
                "Rights
                Offering"),
                the Exercise Price shall be

            

    

    

    
      
        
          
          

        

        
          -4-

          
            

          

        

        
          
          

        

      

    

     

    adjusted
      effective immediately after the record date for the Rights Offering to the
      amount determined by multiplying the Exercise Price in effect on such record
      date by a fraction:

     

    
      	 	
              (i)

            	
              the
                numerator of which shall be the aggregate
                of

            

    

     

    
      	 	
              (A)

            	
              the
                number of Common Shares outstanding on the record date for the Rights
                Offering; and

            

    

     

    
      	 	
              (B)

            	
              the
                quotient determined by dividing

            

    

     

    
      	 	
              (I)

            	
              either
                (a) the product of the number of Common Shares offered during the
                Rights
                Period pursuant to the Rights Offering and the price at which such
                Common
                Shares are offered, or, (b) the product of the exchange or conversion
                price of the securities so offered and the number of Common Shares
                for or
                into which the securities offered pursuant to the Rights Offering
                may be
                exchanged or converted, as the case may be,
                by

            

    

     

    
      	 	
              (II)

            	
              the
                Current Market Price of the Common Shares as of the record date for
                the
                Rights Offering; and

            

    

     

    
      	 	
              (ii)

            	
              the
                denominator of which shall be the aggregate of the number of Common
                Shares
                outstanding on such record date and the number of Common Shares offered
                pursuant to the Rights Offering (including in the case of the issue
                or
                distribution of securities exchangeable for or convertible into Common
                Shares the number of Common Shares for or into which such securities
                may
                be exchanged or converted).

            

    

     

    If
      by the
      terms of the rights, options, or warrants referred to in this section 8(c),
      there is more than one purchase, conversion or exchange price per Common Share,
      the aggregate price of the total number of additional Common Shares offered
      for
      subscription or purchase, or the aggregate conversion or exchange price of
      the
      convertible or exchangeable securities so offered, shall be calculated for
      purposes of the adjustment on the basis of the lowest purchase, conversion
      or
      exchange price per Common Share, as the case may be. Any Common Shares owned
      by
      or held for the account of the Corporation shall be deemed not to be outstanding
      for the purpose of any such calculation. To the extent that any adjustment
      in
      the Exercise Price occurs pursuant to this section 8(c) as a result of the
      fixing by the Corporation of a record date for the issue or distribution of
      rights, options or warrants referred to in this section 8(c), the Exercise
      Price
      shall be readjusted immediately after the expiry of any relevant exchange,
      conversion or exercise right to the Exercise Price which would then be in effect
      based upon the number of Common Shares actually issued and remaining issuable
      after such expiry and shall be further readjusted in such manner upon the expiry
      of any further such right.

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

    If
      the
      Holder has exercised this Compensation Warrant Certificate in accordance
      herewith during the period beginning after the record date for a Rights Offering
      and ending on the last day of the Rights Period thereunder, the Holder will,
      in
      addition to the Common Shares to which it is otherwise entitled upon such
      exercise, be entitled to that number of additional Common Shares equal to the
      difference, if any, between (x) the result obtained when the Exercise Price
      in
      effect immediately prior to the end of such Rights Offering pursuant to this
      subsection is multiplied by the number of Common Shares received upon the
      exercise of this Compensation Warrant Certificate during such period, and the
      resulting product is divided by the Exercise Price as adjusted for such Rights
      Offering pursuant to this subsection provided that the provisions of section
      9
      herein will be applicable to any fractional interest in a Common Share to which
      such Holder might otherwise be entitled and (y) the number of Common Shares
      received upon the exercise of this Compensation Warrant Certificate during
      such
      period. Such additional Common Shares will be deemed to have been issued to
      the
      Holder immediately following the end of the Rights Period and a certificate
      for
      such additional Common Shares will be delivered to such Holder within ten (10)
      business days following the end of the Rights Period.

     

    
      	
            	(d)	
              If
                at any time after the date hereof and prior to the Expiry Time, the
                Corporation shall fix a record date for the issue or distribution
                to the
                holders of all or substantially all of the Common Shares
                of:

            

    

     

    
      	
            	(i)	
              shares
                of the Corporation of any class other than Common
                Shares;

            

    

     

    
      	 	
              (ii)

            	
              rights,
                options or warrants to acquire Common Shares or securities exchangeable
                for or convertible into Common Shares (other than rights, options
                or
                warrants pursuant to which holders of Common Shares are entitled,
                during a
                period expiring not more than 45 days after the record date for such
                issue, to subscribe for or purchase Common Shares at a price per
                share (or
                in the case of securities exchangeable for or convertible into Common
                Shares at an exchange or conversion price per share at the date of
                issue
                of such securities) of at least 95% of the Current Market Price of
                the
                Common Shares on such record date);

            

    

     

    
      	
            	(iii)	
              evidences
                of indebtedness of the Corporation;
                or

            

    

     

    
      	 	
              (iv)

            	
              any
                property or assets of the Corporation (for greater certainty, excluding
                a
                cash dividend);

            

    

     

    and
      if
      such issue or distribution does not constitute a Common Share Reorganization
      or
      a Rights Offering (any of such non-excluded events being herein called a
      "Special
      Distribution"),
      the
      Exercise Price shall be adjusted effective immediately after the record date
      for
      the Special Distribution to the amount determined by multiplying the Exercise
      Price in effect on the record date for the Special Distribution by a
      fraction:

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

    
      	
            	(A)	
              the
                numerator of which shall be the difference
                between

            

    

     

    
      	 	
              (I)

            	
              the
                product of the number of Common Shares outstanding on such record
                date and
                the Current Market Price of the Common Shares on such record date,
                and

            

    

     

    
      	 	
              (II)

            	
              the
                fair value, as determined by the directors of the Corporation, to
                the
                holders of the Common Shares of the shares, rights, options, warrants,
                evidences of indebtedness or property or assets to be issued or
                distributed in the Special Distribution,
                and

            

    

     

    
      	 	
              (B)

            	
              the
                denominator of which shall be the product obtained by multiplying
                the
                number of Common Shares outstanding on such record date by the Current
                Market Price of the Common Shares on such record
                date.

            

    

     

    Any
      Common Shares owned by or held for the account of the Corporation shall be
      deemed not to be outstanding for the purpose of such calculation. To the extent
      that any adjustment in the Exercise Price occurs pursuant to this section 8(d)
      as a result of the fixing by the Corporation of a record date for the issue
      or
      distribution of rights, options or warrants to acquire Common Shares or
      securities exchangeable for or convertible into Common Shares referred to in
      this section 8(d), the Exercise Price shall be readjusted immediately after
      the
      expiry of any relevant exercise, exchange or conversion right to the amount
      which would then be in effect if the fair market value had been determined
      on
      the basis of the number of Common Shares issued and remaining issuable
      immediately after such expiry, and shall be further readjusted in such manner
      upon the expiry of any further such right.

     

    
      	
            	(e)	
              If
                and whenever at any time after the date hereof and prior to the Expiry
                Time there is a capital reorganization of the Corporation or a
                reclassification or other change in the Common Shares (other than
                a Common
                Share Reorganization) or a consolidation or merger or amalgamation
                of the
                Corporation with or into any other corporation or other entity (other
                than
                a consolidation, merger or amalgamation which does not result in
                any
                reclassification of the outstanding Common Shares or a change of
                the
                Common Shares into other securities), or a transfer of all or
                substantially all of the Corporation's undertaking and assets to
                another
                corporation or other entity in which the holders of Common Shares
                are
                entitled to receive shares, other securities or other property (any
                of
                such events being called a "Capital
                Reorganization"),
                after the effective date of the Capital Reorganization the Holder
                shall be
                entitled to receive, and shall accept, for the same aggregate
                consideration, upon exercise of the Compensation Warrants, in lieu
                of the
                number of Common Shares to which the Holder was theretofore entitled
                upon
                the exercise of the Compensation Warrants, the kind and aggregate
                number
                of Common Shares and other securities or property resulting from
                the
                Capital Reorganization which the Holder would have been entitled
                to
                receive as a

            

    

    

    
      
        
          
          

        

        
          -7-

          
            

          

        

        
          
          

        

      

    

     

    result
      of
      the Capital Reorganization if, on the effective date thereof, the Holder has
      been the registered holder of the number of Common Shares to which the Holder
      was theretofore entitled to purchase or receive upon the exercise of the
      Compensation Warrants. If necessary, as a result of any Capital Reorganization,
      appropriate adjustments shall be made in the application of the provisions
      of
      this Compensation Warrant Certificate with respect to the rights and interest
      thereafter of the Holder to the end that the provisions of this Compensation
      Warrant Certificate shall thereafter correspondingly be made applicable as
      nearly as may reasonably be possible in relation to any shares or other
      securities or property thereafter deliverable upon the exercise of this
      Compensation Warrant Certificate.

     

    
      	
            	(f)	
              If
                and whenever at any time after the date hereof and prior to the Expiry
                Time, any of the events set out in sections 8(a), (b), (c), (d) or
                (e)
                herein shall occur and the occurrence of such event results in an
                adjustment of the Exercise Price pursuant to the provisions of this
                section 8, then the number of Common Shares purchasable pursuant
                to this
                Compensation Warrant shall be adjusted contemporaneously with the
                adjustment of the Exercise Price by multiplying the number of Common
                Shares then otherwise purchasable on the exercise thereof by a fraction,
                the numerator of which shall be the Exercise Price in effect immediately
                prior to the adjustment and the denominator of which shall be the
                Exercise
                Price resulting from such
                adjustment.

            

    

     

    
      	
            	(g)	
              If
                the Corporation takes any action affecting its Common Shares to which
                the
                foregoing provisions of this section 8, in the opinion of the board
                of
                directors of the Corporation, acting in good faith, are not strictly
                applicable, or if strictly applicable would not fairly adjust the
                rights
                of the Holder against dilution in accordance with the intent and
                purposes
                hereof, or would otherwise materially affect the rights of the Holder
                hereunder, then the Corporation shall, subject to the approval of
                the TSX
                and the AMEX (or such other stock exchange or quotation system on
                which
                the Common Shares are then listed and posted (or quoted) for trading,
                as
                applicable), execute and deliver to the Holder an amendment hereto
                providing for an adjustment in the application of such provisions
                so as to
                adjust such rights as aforesaid in such manner as the board of directors
                of the Corporation may determine to be equitable in the circumstances,
                acting in good faith. The failure of the taking of action by the
                board of
                directors of the Corporation to so provide for any adjustment on
                or prior
                to the effective date of any action or occurrence giving rise to
                such
                state of facts will be conclusive evidence that the board of directors
                has
                determined that it is equitable to make no adjustment in the
                circumstances.

            

    

     

    
      	9.	
              The
                following rules and procedures shall be applicable to the adjustments
                made
                pursuant to section 8 herein:

            

    

     

    
      	 	
              (a)

            	
              any
                Common Shares owned or held by or for the account of the Corporation
                shall
                be deemed not be to outstanding except that, for the purposes of
                section 8
                herein, any Common Shares owned by a pension plan or profit sharing
                plan
                for

            

    

    

    
      
        
          
          

        

        
          -8-

          
            

          

        

        
          
          

        

      

    

     

    employees
      of the Corporation or any of its subsidiaries shall not be considered to be
      owned or held by or for the account of the Corporation;

     

    
      	 	
              (b)

            	
              no
                adjustment in the Exercise Price or the number of Common Shares
                purchasable pursuant to this Compensation Warrant shall be required
                unless
                a change of at least 1% of the prevailing Exercise Price or the number
                of
                Common Shares purchasable pursuant to this Compensation Warrant would
                result, provided, however, that any adjustment which, except for
                the
                provisions of this section 9(b), would otherwise have been required
                to be
                made, shall be carried forward and taken into account in any subsequent
                adjustment;

            

    

     

    
      	 	
              (c)

            	
              the
                adjustments provided for in section 8 herein are cumulative and shall
                apply to successive subdivisions, consolidations, dividends, distributions
                and other events resulting in any adjustment under the provisions
                of such
                item;

            

    

     

    
      	 	
              (d)

            	
              in
                the absence of a resolution of the board of directors of the Corporation
                fixing a record date for any dividend or distribution referred to
                in
                section 8(b)(iii) herein, the Corporation shall be deemed to have
                fixed as
                the record date therefor the date on which such dividend or distribution
                is effected;

            

    

     

    
      	 	
              (e)

            	
              if
                the Corporation sets a record date to take any action and thereafter
                and
                before the taking of such action abandons its plan to take such action,
                then no adjustment to the Exercise Price will be required by reason
                of the
                setting of such record date;

            

    

     

    
      	 	
              (f)

            	
              as
                a condition precedent to the taking of any action which would require
                any
                adjustment to the Compensation Warrants evidenced hereby, including
                the
                Exercise Price, the Corporation must take any corporate action which
                may
                be necessary in order that the Corporation shall have unissued and
                reserved in its authorized capital and may validly and legally issue
                as
                fully paid and non-assessable all of the shares or other securities
                which
                the Holder is entitled to receive on the full exercise thereof in
                accordance with the provisions
                hereof;

            

    

     

    
      	 	
              (g)

            	
              forthwith,
                but no later than fourteen (14) days, after any adjustment to the
                Exercise
                Price or the number of Common Shares purchasable pursuant to the
                Compensation Warrants, the Corporation shall provide to the Holder
                a
                certificate of an officer of the Corporation certifying as to the
                amount
                of such adjustment and, in reasonable detail, describing the event
                requiring and the manner of computing or determining such
                adjustment;

            

    

     

    
      	 	
              (h)

            	
              any
                question that at any time or from time to time arises with respect
                to the
                amount of any adjustment to the Exercise Price or other adjustment
                pursuant to section 8 herein shall be conclusively determined by
                a firm of
                independent chartered accountants (who may be the Corporation's auditors)
                and shall be binding upon the Corporation and the
                Holder;

            

    

     

    
      	 	
              (i)

            	
              any
                adjustment to the Exercise Price under the terms of this Compensation
                Warrant Certificate shall be subject to the prior approval of the
                TSX and
                the

            

    

    

    
      
        
          
          

        

        
          -9-

          
            

          

        

        
          
          

        

      

    

     

    AMEX
      (or
      such other stock exchange or quotation system on which the Common Shares are
      then listed and posted (or quoted) for trading, as applicable); and

     

    
      	 	
              (j)

            	
              in
                case the Corporation, after the date of issue of this Compensation
                Warrant
                Certificate, takes any action affecting the Common Shares, other
                than an
                action described in section 8 herein, which in the opinion of the
                directors of the Corporation would materially affect the rights of
                the
                Holder, the Exercise Price will be adjusted in such manner, if any,
                and at
                such time, by action by the directors of the Corporation but subject
                in
                all cases to any necessary regulatory approval, including approval
                of the
                TSX and the AMEX (or such other stock exchange or quotation system
                on
                which the Common Shares are then listed and posted (or quoted) for
                trading, as applicable). Failure of the taking of action by the directors
                of the Corporation so as to provide for an adjustment on or prior
                to the
                effective date of any action by the Corporation affecting the Common
                Shares will be conclusive evidence that the board of directors of
                the
                Corporation has determined that it is equitable to make no adjustment
                in
                the circumstances.

            

    

     

    10.     On
      the
      happening of each and every such event set out in section 8 herein, the
      applicable provisions of this Compensation Warrant Certificate, including the
      Exercise Price, shall, ipso
      facto,
      be
      deemed to be amended accordingly and the Corporation shall take all necessary
      action so as to comply with such provisions as so amended.

     

    11.    The
      Corporation shall not be required to deliver certificates for Common Shares
      while the share transfer books of the Corporation are properly closed, having
      regard to the provisions of sections 8 and 9 herein, prior to any meeting of
      shareholders or for the payment of dividends or for any other purpose and in
      the
      event of the surrender of any Compensation Warrant in accordance with the
      provisions hereof and the making of any subscription and payment for the Common
      Shares called for thereby during any such period, delivery of certificates
      for
      Common Shares may be postponed for not more than five (5) business days after
      the date of the re-opening of said share transfer books; provided, however,
      that
      any such postponement of delivery of certificates shall be without prejudice
      to
      the right of the Holder so surrendering the same and making payment during
      such
      period to receive after the share transfer books shall have been re-opened
      such
      certificates for the Common Shares called for, as the same may be adjusted
      pursuant to sections 8 and 9 herein as a result of the completion of the event
      in respect of which the transfer books were closed.

     

    12.    Subject
      as hereinafter provided, all or any of the rights conferred upon the Holder
      by
      the terms hereof may be enforced by the Holder by appropriate legal proceedings.
      No recourse under or upon any obligation, covenant or agreement contained herein
      shall be had against any shareholder or officer of the Corporation either
      directly or through the Corporation, it being expressly agreed and declared
      that
      the obligations under the Compensation Warrants are solely corporate obligations
      and that no personal liability whatever shall attach to or be incurred by the
      shareholders or officers of the Corporation or any of them in respect thereof,
      any and all rights and claims against every such shareholder, officer or
      director being hereby expressly waived as a condition of and as a consideration
      for the issue of the Compensation Warrants.

    
      
        
          
          

        

        
          -10-

          
            

          

        

        
          
          

        

      

    

     

    13.    The
      Holder may subscribe for and purchase any lesser number of Common Shares than
      the number of Common Shares expressed in any Compensation Warrant Certificate.
      In the case of any subscription for a lesser number of Common Shares than
      expressed in any Compensation Warrant Certificate, the Holder hereof shall
      be
      entitled to receive, at no cost to the Holder, a new Compensation Warrant
      Certificate in respect of the balance of Compensation Warrants not then
      exercised. Such new Compensation Warrant Certificate shall be mailed to the
      Holder by the Corporation or, at its direction, the transfer agent of the
      Corporation, contemporaneously with the mailing of the certificate or
      certificates representing the Common Shares issued pursuant to section 5
      herein.

     

    14.    If
      any
      Compensation Warrant Certificate becomes stolen, lost, mutilated or destroyed,
      the Corporation shall, on such terms as it may in its discretion impose, acting
      reasonably, issue and sign a new Compensation Warrant Certificate of like
      denomination, tenor and date as the Compensation Warrant Certificate so stolen,
      lost, mutilated or destroyed for delivery to the Holder.

     

    15.    The
      Holder may transfer the Compensation Warrants represented hereby
      by:

     

    
      	 	
              (a)

            	
              duly
                completing and executing the transfer form attached as Schedule "B"
                ("Transfer
                Form");
                and

            

    

     

    
      	 	
              (b)

            	
              surrendering
                this Compensation Warrant Certificate and the completed Transfer
                Form,
                together with such other documents as the Corporation may reasonably
                request, to the Corporation at the address set forth on the Transfer
                Form
                or such other office as may be specified by the Corporation, in a
                written
                notice to the Holder, from time to
                time,

            

    

     

    provided
      that all such transfers shall be effected in accordance with all applicable
      securities laws, and provided that, after such transfer, the term "Holder"
      shall
      mean and include any transferee or assignee of the current or any future Holder.
      If only part of the Compensation Warrants evidenced hereby is transferred,
      the
      Corporation will deliver to the Holder and the transferee replacement
      Compensation Warrant Certificates substantially in the form of this Compensation
      Warrant Certificate.

     

    16.    Neither
      the Compensation Warrants represented by this Compensation Warrant Certificate
      nor the Common Shares issuable upon exercise hereof have been or will be
      registered under the United States Securities Act of 1933, as amended (the
      "1933
      Act")
      nor
      under the laws of any state of the United States. Subject to certain limited
      exceptions, (i) Compensation Warrants may not be exercised within the United
      States and (ii) no Common Shares issuable upon exercise of Compensation Warrants
      will be delivered to any address in the United States. The Holder acknowledges
      that a legend to that effect may be placed on any certificates representing
      the
      Common Shares issued on exercise of the rights represented by this Compensation
      Warrant Certificate. Terms used in this paragraph have the meanings given to
      them in Regulation S under the 1933 Act.

    
      
        
          
          

        

        
          -11-

          
            

          

        

        
          
          

        

      

    

     

    17.

    
      	 	
              (a)

            	
              The
                Holder acknowledges that the appropriate legend as follows will be
                placed
                upon certificates representing any Common Shares issued upon the
                exercise
                of the Compensation Warrants represented by this certificate prior
                to the date which is four months and one day after the date
                hereof:

            

    

     

    "UNLESS
      PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY MUST NOT
      TRADE THE SECURITY BEFORE JUNE 24, 2007."

     

    
      	 	
              (b)

            	
              The
                Holder understands that upon the original issuance thereof, and until
                such
                time as the same is no longer required under the applicable requirements
                of the U.S. Securities Act or applicable U.S. state laws and regulations,
                the certificates representing the Common Shares will bear a legend
                in
                substantially the following form:

            

    

     

    "THIS
      SECURITY HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF
      1933,
      AS AMENDED (THE "SECURITIES ACT"), AND ACCORDINGLY, MAY NOT BE OFFERED OR SOLD
      EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE
      HOLDER (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
      DEFINED IN RULE 144A ADOPTED UNDER THE SECURITIES ACT); (B) IT IS AN ACCREDITED
      INVESTOR (AS DEFINED IN REGULATION D UNDER THE SECURITIES ACT); OR (C) IT IS
      NOT
      A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN OFFSHORE TRANSACTION IN
      COMPLIANCE WITH REGULATION S ADOPTED UNDER THE SECURITIES ACT; (2) AGREES THAT
      IT WILL NOT RESELL OR OTHERWISE TRANSFER THE SECURITY EVIDENCED, EXCEPT (A)
      TO
      THE ISSUER OR A SUBSIDIARY THEREOF; (B) TO A QUALIFIED INSTITUTIONAL BUYER
      IN
      COMPLIANCE WITH RULE 144A ADOPTED UNDER THE SECURITIES ACT (IF AVAILABLE);
      (C)
      TO PERSONS OTHER THAN U.S. PERSONS OUTSIDE THE UNITED STATES IN COMPLIANCE
      WITH
      REGULATION S UNDER THE SECURITIES ACT; (D) PURSUANT TO THE EXEMPTION FROM
      REGISTRATION PROVIDED BY RULE 144 ADOPTED UNDER THE SECURITIES ACT OR ANOTHER
      AVAILABLE EXEMPTION UNDER THE SECURITIES ACT (IF AVAILABLE); OR (E) PURSUANT
      TO
      AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, AND (3) AGREES
      THAT IT WILL, PRIOR TO ANY TRANSFER OF THIS SECURITY, FURNISH TO THE ISSUER
      SUCH

    
      
        
        

      

      
        -12-

        
          

        

      

      
        
        

      

    

     

    CERTIFICATIONS,
      LEGAL OPINIONS OR OTHER INFORMATION AS MAY BE REQUIRED TO CONFIRM THAT SUCH
      TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT
      SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. AS USED HEREIN,
      THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE
      MEANING GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT. IN ANY CASE,
      THE
      HOLDER HEREOF WILL NOT, DIRECTLY OR INDIRECTLY, ENGAGE IN ANY HEDGING
      TRANSACTION WITH REGARD TO THIS, EXCEPT AS PERMITTED BY THE SECURITIES
      ACT."

     

    provided,
      that if any of the Common Shares are being sold
      pursuant to Rule 144 of the 1933 Act,
      the
      legend may be removed by delivery to the Corporation’s transfer agent of an
      opinion of counsel satisfactory to the Corporation to the effect that such
      Underlying Securities are not "restricted securities" as defined in Rule 144
      under the 1933 Act and the legend is no longer required under applicable
      requirements of the 1933 Act or state securities laws.

     

    
      	 	
              (c)

            	
              The
                Holder acknowledges that the certificates representing the Common
                Shares
                and all certificates issued in exchange or substitution thereof,
                will bear
                a legend in substantially the following form as long as the legend
                referred to in either subsection 17(a) or 17(b) remains on such
                certificate:

            

    

     

    "THE
      SECURITIES REPRESENTED BY THIS CERTIFICATE ARE LISTED ON THE TORONTO STOCK
      EXCHANGE; HOWEVER, THE SAID SECURITIES CANNOT BE TRADED THROUGH THE FACILITIES
      OF SUCH EXCHANGE SINCE THEY ARE NOT FREELY TRADABLE, AND CONSEQUENTLY ANY
      CERTIFICATE REPRESENTING SUCH SECURITIES IS NOT 'GOOD DELIVERY' IN SETTLEMENT
      OF
      TRANSACTIONS ON THE TORONTO STOCK EXCHANGE."

     

    18.    The
      Corporation will maintain a register of holders of Compensation Warrants at
      its
      principal office. The Corporation may deem and treat the registered holder
      of
      any Compensation Warrant Certificate as the absolute owner of the Compensation
      Warrants represented thereby for all purposes, and the Corporation shall not
      be
      affected by any notice or knowledge to the contrary except where the Corporation
      is required to take notice by statute or by order of a court of competent
      jurisdiction. A Holder shall be entitled to the rights evidenced by such
      Compensation Warrant free from all equities or rights of set-off or counterclaim
      between the Corporation and the original or any intermediate holder thereof
      and
      all persons may act accordingly and the receipt by any such Holder of the Common
      Shares purchasable pursuant to such Compensation Warrant shall be a good
      discharge to the Corporation for the same and the

    
      
        
          
          

        

        
          -13-

          
            

          

        

        
          
          

        

      

    

     

    Corporation
      shall not be bound to inquire into the title of any such Holder except where
      the
      Corporation is required to take notice by statute or by order of a court of
      competent jurisdiction.

     

    19.    The
      Corporation shall notify the Holder forthwith of any change of the Corporation’s
      address.

     

    20.    All
      notices to be sent hereunder shall be deemed to be validly given to the
      registered holders of the Compensation Warrants if delivered personally or
      if
      sent by registered letter through the post addressed to such holders at their
      post office addresses appearing in the register of Compensation Warrant holders
      caused to be maintained by the Corporation, and such notice shall be deemed
      to
      have been given, if delivered personally when so delivered, and if sent by
      post
      on the fifth business day next following the post thereof.

     

    21.    If
      for
      any reason, other than the failure or default of the Holder, the Corporation
      is
      unable to issue and deliver the Common Shares or other securities as
      contemplated herein to the Holder upon the proper exercise by the Holder of
      the
      right to purchase any of the Common Shares purchasable upon exercise of the
      Compensation Warrants represented hereby, the Corporation may pay, at its option
      and in complete satisfaction of its obligations and the rights of the Holder
      hereunder, to the Holder, in cash, an amount equal to the difference between
      the
      Exercise Price and the Current Market Price of such Common Shares or other
      securities on the date of exercise by the Holder, and upon such payment the
      Corporation shall have no liability or other obligation to the Holder relating
      to or in respect of the Compensation Warrants or this Compensation Warrant
      Certificate.

     

    22.    This
      Compensation Warrant Certificate shall be governed by the laws of the Province
      of Ontario and the federal laws of Canada applicable herein.

     

    23.    All
      Compensation Warrants shall rank pari
      passu,
      whatever may be the actual date of issue of the same.

     

    24.    This
      Compensation Warrant Certificate shall enure to the benefit of and shall be
      binding upon the Holder and the Corporation and their respective successors
      and
      assigns.

     

    25.    All
      references herein to monetary amounts are references to lawful money of Canada,
      unless otherwise specified herein.

     

    26.    Any
      notice, document or other communication required or permitted by this
      Compensation Compensation Warrant Certificate to be given by the Holder or
      the
      Corporation shall be in writing and is sufficiently given if delivered
      personally, or if delivered or if transmitted by any form of recorded
      telecommunication tested prior to transmission, to such person addressed as
      follows:

    
      
        
          
          

        

        
          -14-

          
            

          

        

        
          
          

        

      

    

     

    
      	
            	(a)	
              if
                to the Holder:

            

    

     

    to
      the
      address on the face page hereof

     

    
      	 	
              (b)

            	
              if
                to the Corporation:

            

    

     

    Apollo
      Gold Corporation

    5655
      S.
      Yosemite Street, Suite 200

    Greenwood
      Village, Colorado, 80111-3220

    Attention:Chief
      Financial Officer

    Telephone
      No.: (720)
      886-9656

    Facsimile
      No.:  (720)
      482-0957

     

    Notice
      so
      delivered shall be deemed to have been given on the Business Day that it is
      received. Notices transmitted by a form of recorded telecommunication shall
      be
      deemed given on the day of transmission. The Holder or the Corporation may
      from
      time to time notify the other in the manner provided herein of any change of
      address or facsimile number which thereafter, until changed by like notice,
      shall be the address or facsimile number of such person for all purposes
      hereof.

     

    IN
      WITNESS WHEREOF
      the
      Corporation has caused this Compensation Warrant Certificate to be signed by
      its
      duly authorized officer.

     

    DATED
      as
      of the 23rd
      day of
      February, 2007.

     

    
      	
              APOLLO
                GOLD CORPORATION

            
	 	 
	
              Per:

            	 

	 	
              Authorized
                Signatory

            
	 	 

    

     

    
      
        
        

      

      
        -15-

        
          

        

      

      
        
        

      

    

     

    Schedule
      "A"

     

    SUBSCRIPTION
      FORM

     

    TO
      BE COMPLETED IF COMPENSATION WARRANTS ARE TO BE EXERCISED:

     

    
      	 	
              TO:

            	
              APOLLO
                GOLD CORPORATION

            

    

    5655
      S.
      Yosemite Street, Suite 200

    Greenwood
      Village, Colorado, 80111-3220

     

     

    The
      undersigned hereby subscribes for ______________________________ Common
      Shares of Apollo
      Gold Corporation
      according to the terms and conditions set forth in the annexed Compensation
      Warrant Certificate (or such number of other securities or property to which
      such Compensation Warrant Certificate entitles the undersigned to acquire under
      the terms and conditions set forth in such Compensation Warrant
      Certificate).

     

    Address
      for Delivery of Common Shares:

     

      
        

      

       

      
        

      

       

      
        

      

       

      Attention:
        ________________________________________

    

     

    Exercise
      Price

    Tendered
      (US$0.50 per Common Share)

    or
      as
      adjusted)                $_________________________________________________

     

    Dated
      at
      ____________________,
      this
      ___ day
      of
      _________________,
      200__.

     

    
      	
            	
              )

              )

              )

              )

              )

              )

              )

              )

            	  

	
              Witness:

               

            	
              Holder's
                Name

            
	
              Authorized
                Signature

            
	
              Title
                (if applicable)

            

    

    Signature
      guaranteed1:

     

    
      

    

    1.    If
      the
      Common Shares are to be registered in a name other than the name of the
      registered Compensation Warrant Holder, the signature of the Compensation
      Warrant Holder must be medallion guaranteed by a bank, trust company or a member
      of a stock exchange in Canada.

    
      
        
        

      

      
        A-1

        
          

        

      

      
        
        

      

    

     

    Schedule
      "B"

     

    COMPENSATION
      WARRANT TRANSFER FORM

     

    FOR
      VALUE
      RECEIVED, subject to receipt of prior written approval of APOLLO GOLD
      CORPORATION (the "Company"),
      the
      undersigned (the "Transferor")
      hereby
      sells, assigns and transfers unto (name) __________________________________
      (the
      "Transferee")
      of
      (residential address) 

    
      
        

      

      
        
          

        

      

    

    Compensation
      Warrants of the Company registered in the name of the undersigned represented
      by
      the within certificate, and irrevocably appoints the Company as the attorney
      of
      the undersigned to transfer the said securities on the register of transfers
      for
      the said Compensation Warrants, with full power of substitution.

     

    
      	
              NOTICE:

            	
              The
                signature of this assignment must correspond with the name as written
                upon
                the face of the certificate, in every particular, without alteration
                or
                enlargement or any change whatever, and must be guaranteed by a bank,
                trust company or a member of a recognized stock exchange. The guarantor
                must affix a stamp bearing the actual words "Signature
                Guaranteed".

            

    

     

    DATED
      this ____ day
      of
      __________,
      20___.

     

     

    
      	  
	 	  

	
              Signature
                Guaranteed

            	 	
              (Signature
                of transferring Compensation Warrantholder)

            
	 	 	 
	 	 	  

	 	 	Name
              (please print)
	 	 	 
	 	 	  

	 	 	Address
	 	 	 

    

     

    
      
        
        

      

      
        B-1

        
          

        

      

      
        
        

      

    

     

    TRANSFEREE
      ACKNOWLEDGMENT

     

    In
      connection with this transfer (check one):

     

    
      	o	
              The
                undersigned transferee hereby certifies that (i) it was not offered
                the
                Compensation Warrants while in the United States and did not execute
                this
                certificate while within the United States; (ii) it is not acquiring
                any
                of the Compensation Warrants represented by this Compensation Warrant
                Certificate by or on behalf of any person within the United States;
                and
                (iii) it has in all other respects complied with the terms of Regulation
                S
                of United States Securities Act of 1933, as amended (the "1933
                Act"),
                or any successor rule or regulation of the United States Securities
                and
                Exchange Commission as presently in
                effect.

            

    

     

    
      	o	
              The
                undersigned transferee is delivering a written opinion of U.S. Counsel
                acceptable to the Company to the effect that this transfer of Compensation
                Warrants has been registered under the 1933 Act or is exempt from
                registration thereunder.

            

    

     

     

    
      	  
	 	
            
	(Signature
              of Transferee)	 	 
	 	 	 
	  
	 	  

	
              Date

            	 	
              Name
                of Transferee (please print)

            
	 	 	 

    

    The
      Compensation Warrants and the common shares issuable upon exercise of the
      Compensation Warrants shall only be transferable in accordance with applicable
      laws. The Compensation Warrants may only be exercised in the manner required by
      the certificate representing the Compensation Warrants and the Compensation
      Warrant Exercise Form attached thereto. Any common shares acquired pursuant
      to
      this Compensation Warrant shall be subject to applicable hold periods and any
      certificate representing such common shares will bear restrictive
      legends.

    
      
        
        

      

      B-2EX 4.5

    EXHIBIT
      4.5

     

    REGISTRATION
      RIGHTS AGREEMENT

     

    THIS
      REGISTRATION RIGHTS AGREEMENT (this “Agreement”)
      is
      made and entered into as of February 23, 2007 by and among Apollo Gold
      Corporation, a Yukon Territory corporation (the “Company”),
      as
      evidenced by the signatures of the Company and the Subscribers pursuant to
      the
      Subscription Agreements (the “Subscription
      Agreements”),
      dated
      February 23, 2007, pursuant to which the Subscribers agreed to purchase
      unsecured convertible debentures (the “Convertible
      Debentures”)
      where
each
      US$1,000 principal amount of Convertible Debentures will convert into 2,000
      common shares, no par value (the “Common
      Shares”),
      of
      the Company, and each US$1,000 of Convertible Debentures will be accompanied
      by
      2,000 common share purchase warrants (the
      “Debenture
      Warrants”)
      of
      the
      Company.
      In
      order to induce the Subscribers under the Subscription Agreements to enter
      into
      the Subscription Agreements, the Company has agreed to provide the registration
      rights set forth in this Agreement.

     

    The
      Company agrees with the Subscribers, (i) for their benefit as Subscribers
      and (ii) for the benefit of the beneficial owners (including the
      Subscribers) from time to time of the Convertible Debentures and the Debenture
      Warrants, and (iii) the beneficial owners from time to time of the Registrable
      Securities (as defined herein) issuable upon conversion of the Convertible
      Debentures or exercise of the Debenture Warrants (each of the foregoing a
“Holder” and together the “Holders”), as follows:

     

    SECTION
      1. Definitions.
      Capitalized terms used herein without definition shall have their respective
      meanings set forth in the Subscription Agreements. In addition to the terms
      that
      are defined elsewhere in this Agreement, the following terms shall have the
      following meanings:

     

    “Affiliate”,
      with
      respect to any specified person, has the meaning specified in Rule
      144.

     

    “Common
      Shares”
has
      the
      meaning specified in the first paragraph of this Agreement.

     

    “Company”
has
      the
      meaning specified in the first paragraph of this Agreement.

     

    “Compensation
      Warrants”
means
      the compensation warrants issued by the Company to the Placement Agents as
      consideration for placing the Convertible Debentures.

     

    “Convertible
      Debentures”
has
      the
      meaning specified in the first paragraph of this Agreement.

     

    “Debenture
      Warrants”
has
      the
      meaning specified in the first paragraph of this Agreement

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    “Deferral
      Notice”
has
      the
      meaning specified in Section 3(d) hereof.

     

    “Deferral
      Period”
has
      the
      meaning specified in Section 3(d) hereof.

     

    “Effectiveness
      Deadline Date”
has
      the
      meaning specified in Section 2(a) hereof.

     

    “Effectiveness
      Period”
means
      the period commencing on the Issue Date and ending on the date that all
      Registrable Securities have ceased to be Registrable Securities.

     

    “Exchange
      Act”
means
      the United States Securities Exchange Act of 1934, as amended, and the rules
      and
      regulations of the SEC promulgated thereunder.

     

    “Filing
      Deadline Date”
has
      the
      meaning specified in Section 2(a) hereof.

     

    “Holder”
has
      the
      meaning specified in the second paragraph of this Agreement.

     

    “Initial
      Resale Registration Statement”
has
      the
      meaning specified in Section 2(a) hereof.

     

    “Issue
      Date”
means
      February 23, 2007.

     

    “Material
      Event”
has
      the
      meaning specified in Section 3(d) hereof.

     

    “Notice
      and Questionnaire”
means
      a
      written notice delivered to the Company containing substantially the information
      called for by the Selling Securityholder Notice and Questionnaire attached
      as
      Annex A to this Agreement.

     

    “Notice
      Holder”
means
      on any date, any Holder that has delivered a Notice and Questionnaire to the
      Company on or prior to such date.

     

    “Prospectus”
means
      the prospectus included in any Registration Statement (including, without
      limitation, a prospectus that discloses information previously omitted from
      a
      prospectus filed as part of an effective registration statement in reliance
      upon
      Rule 415 promulgated under the Securities Act), as amended or supplemented
      by
      any amendment or prospectus supplement, including post-effective amendments,
      and
      all materials incorporated by reference or explicitly deemed to be incorporated
      by reference in such Prospectus.

     

    “Registrable
      Securities”
means
      Common Shares issuable upon conversion of the Convertible Debentures or exercise
      of the Debenture Warrants, and any security issued with respect thereto upon
      any
      stock dividend, split, merger or similar event until, in the case of any such
      security, the earlier of (i) the sale pursuant to Rule 144 under the Securities
      Act or an effective registration statement of all the Registrable Securities
      or
      (ii) the expiration of the holding period applicable thereto under Rule 144(k)
      for all Registrable Securities were such securities not held by an Affiliate
      of
      the Company and the Company’s legal counsel has delivered an opinion letter to
      such effect.

      
        
          
          

        

        
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    “Registration
      Statement”
means
      any registration statement of the Company that covers any of the Registrable
      Securities pursuant to the provisions of this Agreement, including the
      Prospectus, amendments and supplements to such registration statement, including
      post-effective amendments, all exhibits, and all materials incorporated by
      reference or explicitly deemed to be incorporated by reference in such
      registration statement.

     

    “Resale
      Registration Statement”
has
      the
      meaning specified in Section 2(a) hereof.

     

    “Rule
      144”
means
      Rule 144 under the Securities Act, as such Rule may be amended from time to
      time, or any similar or successor rule or regulation hereafter adopted by the
      SEC having substantially the same effect as such Rule.

     

    “SEC”
means
      the United States Securities and Exchange Commission and any successor
      agency.

     

    “Securities
      Act”
means
      the United States Securities Act of 1933, as amended, and the rules and
      regulations promulgated by the SEC thereunder.

     

    “Subscribers”
means
      the subscribers to the Subscription Agreements.

     

    “Subsequent
      Resale Registration Statement”
has
      the
      meaning specified in Section 2(b) hereof.

     

    SECTION
      2. Resale
      Registration. 

     

    (a)    The
      Company shall prepare and file or cause to be prepared and filed with the SEC
      no
      later than a date which is forty (40) days after the Issue Date (the “Filing
      Deadline Date”) a Registration Statement (the “Initial Resale Registration
      Statement”) registering the resale from time to time by Holders of all of the
      Registrable Securities (a “Resale Registration Statement”). The Initial Resale
      Registration Statement shall be on Form S-1 or Form S-3 or another appropriate
      form permitting registration of such Registrable Securities for resale by such
      Holders as selling shareholders and not as underwriters in accordance with
      the
      methods of distribution set forth in the Initial Resale Registration Statement.
      The Company shall use its commercially reasonable efforts to cause the Initial
      Resale Registration Statement to be declared effective under the Securities
      Act
      no later than the date (the “Effectiveness Deadline Date”) that is ninety (90)
      days (or, in the case of a full review by the SEC, one hundred and twenty (120)
      days) after the Issue Date, and to keep, subject to Section 3(d)(A) hereof,
      the
      Initial Resale Registration Statement (or any Subsequent Resale Registration
      Statement) continuously effective under the Securities Act until the expiration
      of the Effectiveness Period; provided,
      however,
      that if
      the SEC deems that the Company is ineligible to use Form S-3 to register the
      resale by Holders of the Registrable Securities because one or more of the
      Holders are deemed to be Affiliates of the Company, then the Filing Deadline
      Date with respect to any such Affiliate shall be 90 days after the Issue Date
      and the Effectiveness Deadline Date shall be 180 days after the Issue Date.
      Each
      Holder that became a Notice Holder on or prior to the date ten (10) Business
      Days prior to the time that the Initial Resale Registration Statement became
      effective shall be named as a selling security holder and not as an underwriter
      in the Initial Resale Registration

      
        
          
          

        

        
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    Statement
      and the related Prospectus in such a manner as to permit such Holder to deliver
      such Prospectus to purchasers of Registrable Securities in accordance with
      applicable law (other than laws not generally applicable to all such Holders).
      Notwithstanding the foregoing, no Holder shall be entitled to have the
      Registrable Securities held by it covered by such Resale Registration Statement
      unless such Holder has provided a Notice and Questionnaire in accordance with
      and in compliance with Section 4. The Company may permit Shoreline Pacific,
      LLC and Regent Securities Capital Corporation (or any of their affiliated
      entities) (the “Placement Agents”) to include the Common Shares issuable upon
      exercise of the Compensation Warrants in the Initial Registration Statement
      or
      any Subsequent Registration Statement.

     

    (b)    If
      the
      Initial Resale Registration Statement or any Subsequent Resale Registration
      Statement ceases to be effective for any reason at any time during the
      Effectiveness Period, the Company shall use its commercially reasonable efforts
      to obtain the prompt withdrawal of any order suspending the effectiveness
      thereof, and in any event shall within thirty (30) days of such cessation of
      effectiveness amend the Resale Registration Statement in a manner reasonably
      expected by the Company to obtain the withdrawal of the order suspending the
      effectiveness thereof, or file an additional Resale Registration Statement
      covering all of the securities that as of the date of such filing are
      Registrable Securities (a “Subsequent Resale Registration Statement”). If a
      Subsequent Resale Registration Statement is filed, the Company shall use
      commercially reasonable efforts to cause the Subsequent Resale Registration
      Statement to become effective as promptly as is reasonably practicable after
      such filing or, if filed during a Deferral Period, after the expiration of
      such
      Deferral Period, and to keep such Registration Statement (or Subsequent Resale
      Registration Statement), subject to Section 3(d)(A) hereof, continuously
      effective until the end of the Effectiveness Period.

     

    (c)    The
      Company shall supplement and amend the Initial or any Subsequent Resale
      Registration Statement if required by the rules, regulations or instructions
      applicable to the registration form used by the Company for such Resale
      Registration Statement, if required by the Securities Act.

     

    (d)    Each
      Holder
      of Registrable Securities agrees that if such Holder wishes to sell Registrable
      Securities pursuant to a Resale Registration Statement and related Prospectus,
      it will do so only in accordance with this Section 2(d), Section 3(d)
      and Section 4. From and after the date the Initial Resale Registration
      Statement is declared effective, the Company shall, as promptly as is reasonably
      practicable after the date a fully completed and legible Notice and
      Questionnaire is received by the Company, (i) if required by applicable
      law, file with the SEC a post-effective amendment to the Resale Registration
      Statement or prepare and, if required by applicable law, file a supplement
      to
      the related Prospectus or a supplement or amendment to any document incorporated
      therein by reference or file any other document required by the SEC so that
      the
      Holder delivering such Notice and Questionnaire is named as a selling security
      holder in the Resale Registration Statement and the related Prospectus in such
      a
      manner as to permit such Holder to deliver such Prospectus to purchasers of
      the
      Registrable Securities in accordance with applicable law (other than laws not
      generally applicable to all Holders of Registrable Securities wishing to sell
      Registrable

      
        
          
          

        

        
          -4-

          
            

          

        

        
          
          

        

      

    Securities
      pursuant to the Resale Registration Statement and related Prospectus) and using
      the manner of sale specified in the Notice and Questionnaire, and, if the
      Company shall file a post-effective amendment to the Resale Registration
      Statement, use commercially reasonable efforts to cause such post-effective
      amendment to be declared effective under the Securities Act as promptly as
      is
      reasonably practicable; (ii) provide such Holder copies of any documents
      filed pursuant to Section 2(d)(i); and (iii) notify such Holder as
      promptly as is reasonably practicable after the effectiveness under the
      Securities Act of any post-effective amendment filed pursuant to
      Section 2(d)(i); provided,
      that if
      such Notice and Questionnaire is delivered during a Deferral Period, the Company
      shall so inform the Holder delivering such Notice and Questionnaire and shall
      take the actions set forth in clauses (i), (ii) and (iii) above upon
      expiration of the Deferral Period in accordance with Section 3(d),
provided,
      further,
      that if
      under applicable law the Company has more than one option as to the type or
      manner of making any such filing, the Company will make the required filing
      or
      filings in the manner or of a type that is reasonably expected to result in
      the
      earliest availability of the Prospectus for effecting resales of Registrable
      Securities. Notwithstanding anything contained herein to the contrary, the
      Company shall be under no obligation to name any Holder that is not a Notice
      Holder as a selling security holder in any Registration Statement or related
      Prospectus; provided,
      however,
      that
      any Holder that becomes a Notice Holder pursuant to the provisions of this
      Section 2(d) of this Agreement (whether or not such Holder was a Notice
      Holder at the time the Registration Statement was initially declared effective)
      shall be named as a selling security holder in the Registration Statement or
      related Prospectus subject to and in accordance with the requirements of this
      Section 2(d).

     

    (e)    If
      the
      Initial Resale Registration Statement has not been (i) filed with the SEC on
      or
      prior to the Filing Deadline Date or (ii) declared effective under the
      Securities Act on or prior to the Effectiveness Deadline Date, the Company
      agrees to pay to each Holder of the Convertible Debentures an amount in cash,
      as
      liquidated damages and not as a penalty, equal to 6% per annum of the aggregate
      principal amount of Convertible Debentures held by such Holder (the “Additional
      Interest”). The Additional Interest shall be payable on the first anniversary of
      the date hereof and the Company’s obligation to pay Additional Interest shall
      cease on the first anniversary of the date hereof.

     

    SECTION
      3. Registration
      Procedures.
      In
      connection with the registration obligations of the Company under Section 2
      hereof, the Company shall:

     

    (a)    Prepare
      and file with the SEC such amendments and post-effective amendments to each
      Registration Statement as may be necessary to keep such Registration Statement
      continuously effective for the applicable period specified in Section 2(a);
      cause the related Prospectus to be supplemented by any required Prospectus
      supplement, and as so supplemented to be filed pursuant to Rule 424 (or any
      similar provisions then in force) under the Securities Act; and use commercially
      reasonable efforts to comply with the provisions of the Securities Act
      applicable to it with respect to the disposition of all securities covered
      by
      such Registration Statement during the Effectiveness Period in accordance with
      the intended methods of disposition by the sellers thereof set forth in such
      Registration Statement as so amended or such Prospectus as so
      supplemented.

      
        
          
          

        

        
          -5-

          
            

          

        

        
          
          

        

      

    (b)    The
      Company shall submit to the SEC, within two (2) Business Days after the Company
      learns that no review of a particular Registration Statement will be made by
      the
      staff of the SEC or that the staff has no further comments on a particular
      Registration Statement, as the case may be, a request for acceleration of
      effectiveness of such Registration Statement to a time and date not later than
      48 hours after the submission of such request.

     

    (c)    Use
      commercially reasonable efforts to obtain the withdrawal of any order suspending
      the effectiveness of a Registration Statement or the lifting of any suspension
      of the qualification (or exemption from qualification) of any of the Registrable
      Securities for sale in any jurisdiction in which they have been qualified for
      sale, in either case at the earliest possible moment or, if any such order
      or
      suspension is made effective during any Deferral Period, at the earliest
      possible moment after the expiration of such Deferral Period.

     

    (d)    Upon
      (A) the issuance by the SEC of a stop order suspending the effectiveness of
      the Resale Registration Statement or the initiation of proceedings with respect
      to the Resale Registration Statement under Section 8(d) or 8(e) of the
      Securities Act, (B) the occurrence of any event or the existence of any
      fact (a “Material Event”) as a result of which any Registration Statement shall
      contain any untrue statement of a material fact or omit to state any material
      fact required to be stated therein or necessary to make the statements therein
      not misleading, or any Prospectus shall contain any untrue statement of a
      material fact or omit to state any material fact necessary to make the
      statements therein, in light of the circumstances under which they were made,
      not misleading (including, in any such case, as a result of the non-availability
      of financial statements), or (C) the occurrence or existence of any
      development, event, fact, situation or circumstance relating to the Company
      that, in the discretion of the Company, makes it appropriate to suspend the
      availability of the Resale Registration Statement and the related Prospectus,
      (i) in the case of clause (B) above, subject to the next sentence, as
      promptly as reasonably practicable prepare and file a post-effective amendment
      to such Registration Statement or a supplement to the related Prospectus or
      any
      document incorporated therein by reference or file any other required document
      that would be incorporated by reference into such Registration Statement and
      Prospectus so that such Registration Statement does not contain any untrue
      statement of a material fact or omit to state any material fact required to
      be
      stated therein or necessary to make the statements therein not misleading,
      and
      such Prospectus does not contain any untrue statement of a material fact or
      omit
      to state any material fact necessary to make the statements therein, in the
      light of the circumstances under which they were made, not misleading, as
      thereafter delivered to the purchasers of the Registrable Securities being
      sold
      thereunder, and, in the case of a post-effective amendment to a Registration
      Statement, subject to the next sentence, use commercially reasonable efforts
      to
      cause it to be declared effective as promptly as is reasonably practicable,
      and
      (ii) give notice (via facsimile, telephone or electronic mail followed by a
      written notice by first-class mail) to the Notice Holders that the availability
      of the Resale Registration Statement is suspended (a “Deferral Notice”) and,
      upon receipt of any Deferral Notice, each Notice Holder agrees not to sell
      any
      Registrable Securities pursuant to the Registration Statement until such Notice
      Holder’s receipt of copies of the supplemented or amended Prospectus provided
      for in clause (i) above, or until it is advised in writing by the Company
      that the Prospectus may be used, and has received copies of any additional
      or
      supplemental filings that are incorporated or deemed incorporated by reference
      in such Prospectus. The Company will use commercially

    
      
        
          
          

        

        
          -6-

          
            

          

        

        
          
          

        

      

    

     

    reasonable
      efforts to ensure that the use of the Prospectus may be resumed (x) in the
      case of clause (A) above, as promptly as is practicable, (y) in the
      case of clause (B) above, as soon as, in the sole reasonable judgment of
      the Company, public disclosure of such Material Event would not be prejudicial
      to or contrary to the interests of the Company or, if necessary to avoid
      unreasonable burden or expense, as soon as reasonably practicable thereafter
      and
      (z) in the case of clause (C) above, as soon as, in the reasonable
      discretion of the Company, such suspension is no longer appropriate. The period
      during which the availability of the Registration Statement and any Prospectus
      is suspended (the “Deferral Period”) is not to exceed (i) 20 consecutive days at
      any one time; (ii) 30 days in the aggregate in any three-month period; or (iii)
      60 days in the aggregate during any 12-month period, or as otherwise required
      by
      applicable regulatory authority; provided that, the number of days the Company
      is required to keep the Registration Statement effective shall be extended
      by
      the number of days equal to the aggregate Deferral Period(s). The first day
      of
      any Deferral Period must be at least two (2) trading days after the last day
      of
      any prior Deferral Period.

     

    (e)    During
      the Effectiveness Period (except during such periods that a Deferral Notice
      is
      outstanding and has not been revoked), deliver to each Notice Holder in
      connection with any sale of Registrable Securities pursuant to a Registration
      Statement, without charge, as many copies of the Prospectus or Prospectuses
      relating to such Registrable Securities and any amendment or supplement thereto
      as such Notice Holder may reasonably request; and the Company hereby consents
      (except during such periods that a Deferral Notice is outstanding and has not
      been revoked) to the use of such Prospectus or each amendment or supplement
      thereto by each Notice Holder in connection with any offering and sale of the
      Registrable Securities covered by such Prospectus or any amendment or supplement
      thereto in the manner set forth therein.

     

    (f)    Subject
      to
      Section 3(d), prior to any public offering of the Registrable Securities
      pursuant to the Resale Registration Statement, use commercially reasonable
      efforts to register or qualify or cooperate with the Notice Holders in
      connection with the registration or qualification (or exemption from such
      registration or qualification) of such Registrable Securities for offer and
      sale
      under the securities or Blue Sky laws of such jurisdictions within the United
      States as any Notice Holder reasonably requests in writing (which request may
      be
      included in the Notice and Questionnaire), it being agreed that no such
      registration or qualification will be made unless so requested; prior to any
      public offering of the Registrable Securities pursuant to the Resale
      Registration Statement, use commercially reasonable efforts to keep each such
      registration or qualification (or exemption therefrom) effective during the
      Effectiveness Period in connection with such Notice Holder’s offer and sale of
      Registrable Securities pursuant to such registration or qualification (or
      exemption therefrom) and do any and all other acts or things necessary to enable
      the disposition in such jurisdictions of such Registrable Securities in the
      manner set forth in the relevant Registration Statement and the related
      Prospectus; provided,
      that
      the Company will not be required to (i) qualify as a foreign corporation or
      as a dealer in securities in any jurisdiction where it is not otherwise
      qualified or (ii) take any action that would subject it to general service
      of process in suits or to taxation in any such jurisdiction where it is not
      then
      so subject.

     

    (g)    Upon
      (i) the filing of the Initial Resale Registration Statement and
      (ii) the effectiveness of the Initial Resale Registration Statement,
      announce the same, in each case by

    
      
        
          
          

        

        
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    press
      release or any other means of dissemination reasonably expected to make such
      information known publicly.

     

    (h)    The
      Company
      will use its commercially reasonable efforts to file as soon as practicable
      following the Issue Date to file an application for listing of the Registrable
      Securities to obtain the listing of the Registrable Securities on the American
      Stock Exchange.

     

    (i)    The
      Company
      will use its commercially reasonable efforts to provide such information as
      is
      required for any filings required to be made with the National Association
      of
      Securities Dealers, Inc.

     

    SECTION
      4. Holder’s
      Obligations.
      Each
      Holder agrees, by acquisition of the Registrable Securities, that no Holder
      of
      Registrable Securities shall be entitled to sell any of such Registrable
      Securities pursuant to a Registration Statement or to receive a Prospectus
      relating thereto, unless such Holder has furnished the Company with a Notice
      and
      Questionnaire as required pursuant to this Section 4 (including the information
      required to be included in such Notice and Questionnaire) and the information
      set forth in the next sentence. Each Holder of Registrable Securities wishing
      to
      sell Registrable Securities pursuant to the Initial or any Subsequent Resale
      Registration Statement and related Prospectus agrees to deliver a Notice and
      Questionnaire to the Company at least five (5) business days prior to the filing
      of the Initial Resale Registration Statement or Subsequent Resale Registration
      Statement. Each Notice Holder agrees promptly to furnish to the Company in
      writing all information required to be disclosed in order to make the
      information previously furnished to the Company by such Notice Holder not
      misleading, any other information regarding such Notice Holder and the
      distribution of such Registrable Securities as may be required to be disclosed
      in the Registration Statement under applicable law or pursuant to SEC comments
      and any information otherwise required by the Company to comply with applicable
      law or regulations. Each Holder further agrees, following termination of the
      Effectiveness Period, to notify the Company, within ten (10) Business Days
      of a
      request, of the amount of Registrable Securities sold pursuant to the
      Registration Statement and, in the absence of a response, the Company may assume
      that all of the Holder’s Registrable Securities were so sold.

     

    SECTION
      5. Registration
      Expenses.
      The
      Company shall bear all fees and expenses incurred in connection with the
      performance by the Company of its obligations under Sections 2 and 3 of
      this Agreement whether or not any of the Registration Statements are declared
      effective. Such fees and expenses shall include, without limitation,
      (i) all registration and filing fees (including, without limitation, fees
      and expenses (x) with respect to filings required to be made with the
      American Stock Exchange, (y) of compliance with federal and state
      securities or Blue Sky laws to the extent such filings or compliance are
      required pursuant to this Agreement (including, without limitation, reasonable
      fees and disbursements of the counsel specified in the next sentence in
      connection with Blue Sky qualifications of the Registrable Securities under
      the
      laws of such jurisdictions as the Notice Holders of a majority of the
      Registrable Securities being sold pursuant to a Registration Statement may
      designate)), and (z) with respect to filings required to be made with the
      National Association of Securities Dealers, Inc., (ii) printing expenses,
      (iii) duplication expenses relating to copies of any Registration Statement
      or Prospectus delivered to any

      
        
          
          

        

        
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    Holders
      hereunder, and (iv) fees and disbursements of counsel for the Company in
      connection with the Resale Registration Statement. In addition, the Company
      shall pay its internal expenses (including, without limitation, all salaries
      and
      expenses of officers and employees performing legal or accounting duties),
      and
      its expenses for any annual audit, the fees and expenses incurred in connection
      with the listing of the Registrable Securities on any securities exchange on
      which the same securities of the Company are then listed and the fees and
      expenses of any person, including special experts, retained by the
      Company.

     

    SECTION
      6. Information
      Requirements.
      The
      Company covenants that, if at any time before the end of the Effectiveness
      Period the Company is not subject to the reporting requirements of the Exchange
      Act, it will cooperate with any Holder of Registrable Securities and take such
      further reasonable action as any Holder of Registrable Securities may reasonably
      request in writing (including, without limitation, making such reasonable
      representations as any such Holder may reasonably request), all to the extent
      required from time to time to enable such Holder to sell Registrable Securities
      without registration under the Securities Act within the limitations of Rule
      144
      under the Securities Act and customarily taken in connection with sales pursuant
      to such exemptions. Upon the written request of any Holder of Registrable
      Securities, the Company shall deliver to such Holder a written statement as
      to
      whether it has complied with such filing requirements, unless such a statement
      has been included in the Company’s most recent annual or quarterly report
      required to be filed and filed pursuant to Section 13 or Section 15(d)
      of the Exchange Act. 

     

    SECTION
      7. Indemnification
      and Contribution.    

     

    (a)    The
      Company
      agrees to indemnify and hold harmless each Holder of Registrable Securities
      covered by the Resale Registration Statement, the directors, officers,
      employees, Affiliates and agents of each such Holder and each person who
      controls any such Holder within the meaning of either the Securities Act or
      the
      Exchange Act against any and all losses, claims, damages or liabilities, joint
      or several, to which they or any of them may become subject under the Securities
      Act, the Exchange Act or other federal or state statutory law or regulation,
      at
      common law or otherwise, insofar as such losses, claims, damages or liabilities
      (or actions in respect thereof) arise out of or are based upon any untrue
      statement or alleged untrue statement of a material fact contained in the Resale
      Registration Statement or in any amendment thereof, in each case at the time
      such became effective under the Securities Act, or in any preliminary Prospectus
      or the Prospectus, or in any amendment thereof or supplement thereto, or arise
      out of or are based upon the omission or alleged omission to state therein
      a
      material fact required to be stated therein or necessary to make the statements
      therein (in the case of any preliminary Prospectus or the Prospectus, in the
      light of the circumstances under which they were made) not misleading, and
      agrees to reimburse each such indemnified party, as incurred, for any legal
      or
      other expenses reasonably incurred by it in connection with investigating or
      defending any such loss, claim, damage, liability or action; provided,
      however,
      that
      the Company will not be liable in any such case to the extent that any such
      loss, claim, damage or liability arises out of or is based upon any such untrue
      statement or alleged untrue statement or omission or alleged omission made
      therein in reliance upon and in conformity with written information furnished
      to
      the Company by or on behalf of the party claiming indemnification specifically
      for inclusion therein. This

    
      
        
          
          

        

        
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    indemnity
      agreement shall be in addition to any liability that the Company may otherwise
      have.

     

    (b)    Each
      Holder
      of securities covered by the Resale Registration Statement severally and not
      jointly agrees to indemnify and hold harmless the Company, each of its
      directors, each of its officers who signs the Resale Registration Statement
      and
      each person who controls the Company within the meaning of either the Securities
      Act or the Exchange Act, to the same extent as the foregoing indemnity from
      the
      Company to each such Holder, but only with reference to information relating
      to
      such Holder furnished to the Company by or on behalf of such Holder specifically
      for inclusion in the documents referred to in the foregoing indemnity. This
      indemnity agreement shall be acknowledged by each Notice Holder that is not
      a
      Subscriber in such Notice Holder's Notice and Questionnaire and shall be in
      addition to any liability that any such Notice Holder may otherwise
      have.

     

    (c)    Promptly
      after receipt by an indemnified party under this Section 7 or notice of the
      commencement of any action, such indemnified party will, if a claim in respect
      thereof is to be made against the indemnifying party under this Section 7,
      notify the indemnifying party in writing of the commencement thereof; but the
      failure so to notify the indemnifying party (i) will not relieve it from
      liability under paragraph (a) or (b) above unless such failure results
      in the forfeiture by the indemnifying party of substantial rights and defenses
      or otherwise materially prejudices the indemnifying party; and (ii) will
      not, in any event, relieve the indemnifying party from any obligations to any
      indemnified party other than the indemnification obligation provided in
      paragraph (a) or (b) above. The indemnifying party shall be entitled
      to appoint counsel (including local counsel) of the indemnifying party's choice
      at the indemnifying party's expense to represent the indemnified party in any
      action for which indemnification is sought (in which case the indemnifying
      party
      shall not thereafter be responsible for the fees and expenses of any separate
      counsel, other than local counsel if not appointed by the indemnifying party,
      retained by the indemnified party or parties except as set forth below);
provided,
      however,
      that
      such counsel shall be reasonably satisfactory to the indemnified party.
      Notwithstanding the indemnifying party's election to appoint counsel (including
      local counsel) to represent the indemnified party in an action, the indemnified
      party shall have the right to employ separate counsel (including local counsel),
      and the indemnifying party shall bear the reasonable fees, costs and expenses
      of
      such separate counsel if (i) the use of counsel chosen by the indemnifying
      party to represent the indemnified party would present such counsel with a
      conflict of interest; (ii) the actual or potential defendants in, or
      targets of, any such action include both the indemnified party and the
      indemnifying party and the indemnified party shall have reasonably concluded
      that there may be legal defenses available to it and/or other indemnified
      parties that are different from or additional to those available to the
      indemnifying party; (iii) the indemnifying party shall not have employed
      counsel reasonably satisfactory to the indemnified party to represent the
      indemnified party within a reasonable time after notice of the institution
      of
      such action; or (iv) the indemnifying party shall authorize the indemnified
      party to employ separate counsel at the expense of the indemnifying party.
      An
      indemnifying party will not, without the prior written consent of the
      indemnified parties, settle or compromise or consent to the entry of any
      judgment with respect to any pending or threatened claim, action, suit or
      proceeding in respect of which indemnification or contribution may be sought
      hereunder (whether or not the indemnified parties are actual or potential
      parties to such claim or action) unless such

      
        
          
          

        

        
          -10-

          
            

          

        

        
          
          

        

      

    settlement,
      compromise or consent includes an unconditional release of each indemnified
      party from all liability arising out of such claim, action, suit or
      proceeding.

     

    (d)    If
      the
      indemnification to which an indemnified party is entitled under this
      Section 7 is for any reason unavailable to or insufficient although
      applicable in accordance with its terms to hold harmless an indemnified party
      in
      respect of any losses, liabilities, claims, damages or expenses referred to
      therein, then each indemnifying party shall contribute to the aggregate amount
      of such losses, liabilities, claims, damages and expenses incurred by such
      indemnified party, as incurred, in such proportion as is appropriate to reflect
      the relative fault of the indemnifying party or parties on the one hand and
      of
      the indemnified party on the other hand in connection with the statements or
      omissions which resulted in such losses, liabilities, claims, damages or
      expenses, as well as any other relevant equitable considerations.

     

    The
      relative fault of the Company on the one hand and the Holders of the Registrable
      Securities or the Subscribers on the other hand shall be determined by reference
      to, among other things, whether any such untrue or alleged untrue statement
      of a
      material fact or omission or alleged omission to state a material fact relates
      to information supplied by the Company or by the holder of the Registrable
      Securities or the Subscribers and the parties’ relative intent, knowledge,
      access to information and opportunity to correct or prevent such statement
      or
      omission.

     

    The
      parties hereto agree that it would not be just and equitable if contribution
      pursuant to this Section 7(d) were determined by pro rata allocation or by
      any other method of allocation which does not take account of the equitable
      considerations referred to above in this Section 7(d). The aggregate amount
      of losses, liabilities, claims, damages, and expenses incurred by an indemnified
      party and referred to above in this Section 7(d) shall be deemed to include
      any out-of-pocket legal or other expenses reasonably incurred by such
      indemnified party in investigating, preparing or defending against any
      litigation, or any investigation or proceeding by any governmental agency or
      body, commenced or threatened, or any claim whatsoever based upon any such
      untrue or alleged untrue statement or omission or alleged omission.

     

    Notwithstanding
      the provisions of this Section 7, neither the Holder of any Registrable
      Securities nor the Subscribers shall be required to indemnify or contribute
      any
      amount in excess of the amount by which the net proceeds received from the
      sale
      of the Registrable Securities sold by such Holder or Subscriber exceeds the
      amount of any damages that such Holder of Registrable Securities or the
      Subscribers has otherwise been required to pay by reason of such untrue or
      alleged untrue statement or omission or alleged omission.

     

    No
      person
      guilty of fraudulent misrepresentation (within the meaning of Section 11(f)
      of the Securities Act) shall be entitled to contribution from any person who
      was
      not guilty of such fraudulent misrepresentation.

     

    For
      purposes of this Section 7(d), each person, if any, who controls the
      Subscribers or any Holder of Registrable Securities within the meaning of
      Section 15 of the Securities Act or Section 20 of the Exchange Act
      shall have the same rights to contribution as

      
        
          
          

        

        
          -11-

          
            

          

        

        
          
          

        

      

    the
      Subscribers or such Holder, and each person, if any, who controls the Company
      within the meaning of Section 15 of the Securities Act or Section 20
      of the Exchange Act shall have the same rights to contribution as the
      Company.

     

    (e)    The
      provisions of this Section 7 shall remain in full force and effect,
      regardless of any investigation made by or on behalf of any Holder or the
      Company or any of the indemnified persons referred to in this Section 7,
      and shall survive the sale by a Holder of Registrable Securities covered by
      the
      Resale Registration Statement.

     

    SECTION
      8. Rule
      144.
      As long
      as any Holder owns any Registrable Securities, Convertible Debentures or
      Debenture Warrants, the Company covenants to timely file (or obtain extensions
      in respect thereof and file within
      the
      applicable grace period) all reports required to be filed by the Company after
      the date hereof pursuant to Section 13(a) or 15(d) of the Exchange Act and
      to
      promptly furnish the Holders with true and complete copies of all such filings.
      As long as any Holder owns any Registrable Securities, Convertible Debentures
      or
      Debenture Warrants, if the Company is not required to file reports pursuant
      to
      Section 13(a) or 15(d) of the Exchange Act, it will prepare and furnish to
      the
      Holders and make publicly available in accordance with Rule 144(c) promulgated
      under the Securities Act annual and quarterly financial statements, together
      with a discussion and analysis of such financial statements in form and
      substance substantially similar to those that would otherwise be required to
      be
      included in reports required by Section 13(a) or 15(d) of the Exchange Act,
      as
      well as any other information required thereby, in the time period that such
      filings would have been required to have been made under the Exchange Act.
      The
      Company further covenants that it will take such further action as any Holder
      may reasonably request in writing, all to the extent required from time to
      time
      to enable such Person to sell the Registrable Securities without registration
      under the Securities Act within the limitation of the exemptions provided by
      Rule 144 promulgated under the Securities Act, including providing any legal
      opinions relating to such sale pursuant to Rule 144. 

     

    SECTION
      9. Miscellaneous

     

    (a)    No
      Conflicting Agreements.
      The
      Company is not, as of the date hereof, a party to, nor shall they, on or after
      the date of this Agreement, enter into, any agreement with respect to the
      Company’s securities that conflicts with the rights granted to the Holders of
      Registrable Securities in this Agreement. The Company represents and warrants
      that the rights granted to the Holders of Registrable Securities hereunder
      do
      not in any way conflict with the rights granted to the holders of the Company’s
      securities under any other agreements.

     

    (b)    Amendments
      and Waivers.
      The
      provisions of this Agreement, including the provisions of this sentence, may
      not
      be amended, modified or supplemented, and waivers or consents to departures
      from
      the provisions hereof may not be given, unless the Company has obtained the
      written consent of Holders of a majority of the then outstanding Registrable
      Securities constituting Common Shares (with Holders of Convertible Debentures
      deemed to be the Holders, for purposes of this Section, of the number of
      outstanding Common Shares into which such Convertible Debentures are or would
      be
      convertible or exchangeable as of the date on which such consent is requested
      and Holders of Debenture Warrants deemed to

      
        
          
          

        

        
          -12-

          
            

          

        

        
          
          

        

      

    be
      the
      Holders, for purposes of this Section, of the number of outstanding Common
      Shares for which such Debenture Warrants are or would be exercisable as of
      the
      date on which such consent is requested). Notwithstanding the foregoing, a
      waiver or consent to depart from the provisions hereof with respect to a matter
      that relates exclusively to the rights of Holders of Registrable Securities
      whose securities are being sold pursuant to a Registration Statement and that
      does not directly or indirectly affect the rights of other Holders of
      Registrable Securities may be given by Holders of at least a majority of the
      Registrable Securities being sold by such Holders pursuant to such Registration
      Statement; provided,
      that
      the provisions of this sentence may not be amended, modified, or supplemented
      except in accordance with the provisions of the immediately preceding sentence.
      Each Holder of Registrable Securities outstanding at the time of any such
      amendment, modification, supplement, waiver or consent or thereafter shall
      be
      bound by any such amendment, modification, supplement, waiver or consent
      effected pursuant to this Section 8(b), whether or not any notice, writing
      or marking indicating such amendment, modification, supplement, waiver or
      consent appears on the Registrable Securities or is delivered to such Holder.
      If
      a Registration Statement does not register all of the Registrable Securities
      pursuant to a waiver or amendment done in compliance with the previous sentence,
      then the number of Registrable Securities to be registered for each Holder
      shall
      be reduced pro rata
      among
      all Holders and each Holder shall have the right to designate which of its
      Registrable Securities shall be omitted from such Registration
      Statement.

     

    (c)    Notices.
      All
      notices and other communications provided for or permitted hereunder shall
      be
      made in writing by hand delivery, by telecopier, by courier guaranteeing
      overnight delivery or by first-class mail, return receipt requested, and shall
      be deemed given (i) when made, if made by hand delivery, (ii) upon
      confirmation, if made by telecopier, (iii) one (1) Business Day after being
      deposited with such courier, if made by overnight courier, or (iv) on the
      date indicated on the notice of receipt, if made by first-class mail, to the
      parties as follows:

     

    if
      to a
      Notice Holder, at the most current address given by such Holder to the Company
      in a Notice and Questionnaire or any amendment thereto;

     

    if
      to the
      Company, to:

     

    Apollo
      Gold, Inc.

    5655
      S.
      Yosemite Street, Suite 200

    Greenwood
      Village, CO 80111-3220

    Facsimile:
      (303) 524-3280

    Attention:
      Chief
      Financial Officer

     

    with
      a
      copy to:

      
        
          
          

        

        
          -13-

          
            

          

        

        
          
          

        

      

    

     

    Davis
      Graham & Stubbs LLP

    1550
      Seventeenth Street, Suite 500

    Denver,
      Colorado 80202

    Attention:
      Deborah J. Friedman, Esq.

    Facsimile
      No. (303) 893-1379

    

    or
      to
      such other address as such person may have furnished to the other persons
      identified in this Section 8(c) in writing in accordance
      herewith.

     

    (d)    Approval
      of Holders.
      Whenever the consent or approval of Holders of a specified percentage of
      Registrable Securities is required hereunder, Registrable Securities held by
      the
      Company or its Affiliates (other than the Subscribers or subsequent Holders
      of
      Registrable Securities if such subsequent Holders are deemed to be such
      Affiliates solely by reason of their holdings of such Registrable Securities)
      shall not be counted in determining whether such consent or approval was given
      by the Holders of such required percentage.

     

    (e)    Successors
      and Assigns.
      This
      Agreement shall inure to the benefit of and be binding upon the successors
      and
      assigns of each of the parties hereto and, without requiring any express
      assignment, shall inure to the benefit of and be binding upon each Holder of
      any
      Registrable Securities; provided,
      that
      nothing herein shall be deemed to permit any assignment, transfer of other
      disposition of Registrable Securities in violation of the terms of the
      Subscription Agreements. If any transferee of any Holder shall acquire
      Registrable Securities in any manner, whether by operation of law or otherwise,
      such Registrable Securities shall be subject to all of the terms of this
      Agreement and by taking and holding such Registrable Securities such person
      shall be conclusively deemed to have agreed to be bound by and to perform all
      of
      the terms and provisions of this Agreement.

     

    (f)    Counterparts.
      This
      Agreement may be executed in any number of counterparts and by the parties
      hereto in separate counterparts, each of which when so executed shall be deemed
      to be original and all of which taken together shall constitute one and the
      same
      agreement.

     

    (g)    Headings.
      The
      headings in this Agreement are for convenience of reference only and shall
      not
      limit or otherwise affect the meaning hereof.

     

    (h)    Governing
      Law.
      THIS
      AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
      THE
      STATE OF COLORADO.

     

    (i)    Severability.
      If any
      term, provision, covenant or restriction of this Agreement is held to be
      invalid, illegal, void or unenforceable, the remainder of the terms, provisions,
      covenants and restrictions set forth herein shall remain in full force and
      effect and shall in no way be affected, impaired or invalidated thereby, and
      the
      parties hereto shall use their reasonable best efforts to find and employ an
      alternative means to achieve the same or substantially the same result as that
      contemplated by such term, provision, covenant or

    
      
        
          
          

        

        
          -14-

          
            

          

        

        
          
          

        

      

    

     

    restriction,
      it being intended that all of the rights and privileges of the parties hereto
      shall be enforceable to the fullest extent permitted by law.

     

    (j)    Entire
      Agreement.
      This
      Agreement is intended by the parties hereto as a final expression of their
      agreement and is intended to be a complete and exclusive statement of the
      agreement and understanding of the parties hereto in respect of the subject
      matter contained herein and the registration rights granted by the Company
      with
      respect to the Registrable Securities. Except as provided in the Subscription
      Agreements, there are no restrictions, promises, warranties or undertakings,
      other than those set forth or referred to herein, with respect to the
      registration rights granted by the Company with respect to the Registrable
      Securities. This Agreement supersedes all prior agreements and undertakings
      among the parties hereto with respect to such registration rights.

     

    (k)    Termination.
      This
      Agreement and the obligations of the parties hereunder shall terminate upon
      the
      earlier to occur of the expiration of the Effectiveness Period or such time
      as
      there shall be no Registrable Securities.

    
      
        
        

      

      
        -15-

        
          

        

      

      
        
        

      

    

     

    ANNEX
      A

    

    FORM
      OF SELLING SECURITYHOLDER NOTICE AND QUESTIONNAIRE.
      

    

    The
      undersigned beneficial owner (the "Selling Securityholder") of Registrable
      Securities hereby gives notice to the Company of its intention to sell or
      otherwise dispose of Registrable Securities beneficially owned by it and listed
      below in Item 3 (unless otherwise specified under such Item 3) pursuant to
      the
      Resale Registration Statement. The undersigned, by signing and returning this
      Notice and Questionnaire, understands that it will be bound by the terms and
      conditions of this Notice and Questionnaire and the Registration Rights
      Agreement. 

    

    Pursuant
      to the Registration Rights Agreement, the undersigned has agreed to indemnify
      and hold harmless the Company's directors and officers and each person, if
      any,
      who controls the Company within the meaning of either Section 15 of the
      Securities Act or Section 20 of the Securities Exchange Act of 1934, as amended
      (the "Exchange Act"), from and against certain losses arising in connection
      with
      statements concerning the undersigned made in the Company's Resale Registration
      Statement or the related prospectus in reliance upon the information provided
      in
      this Notice and Questionnaire. 

    

    If
      the
      Selling Securityholder transfers all or any portion of the Registrable
      Securities listed in Item 3 below after the date on which such information
      is
      provided to the Company, the Selling Securityholder agrees to notify the
      transferee(s) at the time of the transfer of its rights and obligations under
      this Notice and Questionnaire and the Registration Rights Agreement.

    

    [CONTINUED
      NEXT PAGE]

    
      
        
          
          

        

        
          -16-

          
            

          

        

        
          
          

        

      

    

     

    QUESTIONNAIRE

    

    Please
      respond to every item, even if your response is "none." If you need more space
      for any response, please attach additional sheets of paper. Please be sure
      to
      indicate your name and the number of the item being responded to on each such
      additional sheet of paper, and to sign each such additional sheet of paper
      before attaching it to this Questionnaire. Please note that you may be asked
      to
      answer additional questions depending on your responses to the following
      questions. 

    

    COMPLETED
      QUESTIONNAIRES SHOULD BE RETURNED TO

    APOLLO
      GOLD CORPORATION AS FOLLOWS:

    

    1
      COPY BY FACSIMILE TO FAX:
      (303)
      524-3280

    

    WITH
      THE
      ORIGINAL COPY TO FOLLOW TO:

    

    APOLLO
      GOLD CORPORATION

    

    5655
      S. YOSEMITE STREET, SUITE 200, GREENWOOD VILLAGE, CO
      80111-3220

    

    ATTENTION:
      CHIEF FINANCIAL OFFICER

    

    The
      undersigned hereby provides the following information to the Company and
      represents and warrants that such information is accurate and complete:

    

    
      	
              1.

            	
              Your
                Identity and Background as the Beneficial Owner of The Registrable
                Securities. 

            

    

    

    
      	 	
              (a)

            	
              Your
                full legal name:

            

    

     

      
        

      

    

     

    
      	 	
              (b)

            	
              Your
                business address (including street address) (or residence if no business
                address), telephone number and facsimile number:
                

            

    

    

    Address:

    
      
        

      

      Telephone
        No.: 

      
        
          

        

        Fax
          No.:

        
          
            

          

        

      

    

     

    
      	 	
              (c)

            	
              Are
                you a broker-dealer registered pursuant to Section 15 of the Exchange
                Act?
                

            

    

     

    
      	 	 	
               ̈
                Yes. 

            

    

     

    
      	 	 	
               ̈
                No. 

            

    

     

    
      	 	
              (d)

            	
              If
                your response to Item 1(c) above is no, are you an "affiliate" of
                a
                broker-dealer registered pursuant to Section 15 of the Exchange Act?
                

            

    

     

    
      	 	 	
               ̈
                Yes. 

            

    

     

    
      	 	 	
               ̈
                No. 

            

    

    

    For
      the
      purposes of this Item 1(d), an "affiliate" of a registered broker-dealer shall
      include any company that directly, or indirectly through one or more
      intermediaries, controls, or is controlled by, or is under common control with,
      such broker-dealer, and does not include any individuals employed by such
      broker-dealer or its affiliates. 

      
        
          
          

        

        
          -17-

          
            

          

        

        
          
          

        

      

    
      	
            	(e)	
              Full
                legal name of person through which you hold the Registrable
                Securities—(i.e.
                name of your broker, if applicable, through which your Registered
                Securities are held): 

            

    

    

    
      	 	 	
              Name
                of broker:: 

            

    

    

    
      	 	 	
              Contact
                person: 

            

    

    

    
      	 	 	
              Telephone
                No.: 

            

    

    

    
      	
              2.

            	
              Your
                Relationship With Apollo Gold
                Corporation

            

    

    

    
      	 	
              (a)

            	
              Have
                you or any of your affiliates, officers, directors or principal equity
                holders (owners of 5% or more of the equity securities of the undersigned)
                held any position or office or have you had any other material
                relationship with Apollo Gold Corporation (or their respective
                predecessors or affiliates) within the past three years?
                

            

    

    

    
      	 	 	
               ̈
                Yes. 

            

    

    

    
      	 	 	
               ̈
                No. 

            

    

    

    
      	 	
              (b)

            	
              If
                your response to Item 2(a) above is yes, please state the nature
                and
                duration of your relationship with Apollo Gold Corporation:
                

            

       

      
        

      

       

      
        

      

       

    

    
      	
              3.

            	
              Your
                Interest in the Registrable Securities.

            

    

    

    
      	
            	(a)	
              State
                the number of such Registrable Securities beneficially owned by you.
                

            

    

     

    
      

    

     

    
      	 	
              (b)

            	
              Other
                than as set forth in your response to Item 3(a) above, do you beneficially
                own any other securities of Apollo Gold Corporation?
                

            

    

    

    
      	 	 	
               ̈
                Yes. 

            

    

    

    
      	 	 	
               ̈
                No. 

            

    

    

    
      	 	
              (c)

            	
              If
                your answer to Item 3(b) above is yes, state the type, the aggregate
                amount and CUSIP No. (if applicable) of such other securities of
                Apollo
                Gold Corporation beneficially owned by you:

            

    

    

    Type:

    
      
        

      

    

    Aggregate
      amount:

    
      
        

      

    

    CUSIP
      No.:

    
      
        

      

       

    

    
      	 	
              (d)

            	
              Did
                you acquire the securities listed in Item 3(a) above in the ordinary
                course of business? 

            

    

    

    
      	 	 	
               ̈
                Yes. 

            

    

    
      
        
        

      

      
        -18-

        
          

        

      

      
        
        

      

    

     

    
      	 	 	
               ̈
                No. 

            

    

    

    
      	 	
              (e)

            	
              At
                the time of your purchase of the securities listed in Item 3(a) above,
                did
                you have any agreements or understandings, directly or indirectly,
                with
                any person to distribute the securities?

            

    

    

    
      	 	 	
               ̈
                Yes. 

            

    

    

    
      	 	 	
               ̈
                No. 

            

    

    

    
      	 	
              (f)

            	
              If
                your response to Item 3(e) above is yes, please describe such agreements
                or understandings: 

            

    

    

    
      	 	 	
               ̈
                Yes. 

            

    

    

    
      	 	 	
               ̈
                No. 

            

    

    

    
      	
              4.

            	
              Nature
                of Your Beneficial Ownership. 

            

    

    

    
      	 	
              (a)

            	
              Name
                your controlling shareholder(s) or other person who has the ability
                to
                exercise control over you (the "Controlling Entity"). If the Controlling
                Entity is not a natural person and is not a publicly held entity,
                name
                each shareholder of such Controlling Entity. If any of these named
                shareholders are not natural persons or publicly held entities, please
                provide the same information. This process should be repeated until
                you
                reach natural persons or a publicly held entity.
                

            

    

    

    
      	 	
              (A)(i)

            	
              Full
                legal name of Controlling Entity(ies) or natural person(s) with who
                have
                sole or shared voting or dispositive power over the Registrable
                Securities:

            
	 	 	
              Business
                address (including street address) (or residence if no business address),
                telephone number and facsimile number of such
                person(s):

            
	 	 	
              Address:   

            
	 	 	
              Telephone:   

            
	 	 	
              Fax:   

            
	 	 	
              Name
                of shareholder:;

            
	 	 	
                 
                

            
	 	 	
                  
                

            
	 	
              (B)(i)

            	
              Full
                legal name of Controlling Entity(ies):

            
	 	 	
                  
                

            
	 	 	
              Business
                address (including street address) (or residence if no business address),
                telephone number and facsimile number of such
                person(s):

            
	 	 	
              Address:   

            
	 	 	
              Telephone:   

            
	 	 	
              Fax:   

            
	 	 	
              Name
                of shareholders:   

            
	 	 	 

    

     

    If
      you
      need more space for this response, please attach additional sheets of paper.
      Please be sure to indicate your name and the number of the item being responded
      to on each such additional sheet of paper, and to sign each such additional
      sheet of paper before attaching it to this Questionnaire. Please note that
      you
      may be asked to answer additional questions depending on your responses to
      the
      following questions. 

    

    
      	
              5.

            	
              Plan
                of Distribution. 

            

    

    

    Each
      Selling Stockholder (the “Selling
      Stockholders”)
      of the
      common stock and any of their pledgees, assignees and successors-in-interest
      may, from time to time, sell any or all of their shares of common stock on
      the
      American Stock Exchange or any other stock exchange, market or trading facility
      on which the shares are traded or

    
      
        
          
          

        

        
          -19-

          
            

          

        

        
          
          

        

      

    

     

    in
      private transactions. These sales may be at fixed or negotiated prices. A
      Selling Stockholder may use any one or more of the following methods when
      selling shares:

     

    
      	 	
              ·

            	
              ordinary
                brokerage transactions and transactions in which the broker-dealer
                solicits purchasers;

            

    

     

    
      	 	
              ·

            	
              block
                trades in which the broker-dealer will attempt to sell the shares
                as agent
                but may position and resell a portion of the block as principal to
                facilitate the transaction;

            

    

     

    
      	 	
              ·

            	
              purchases
                by a broker-dealer as principal and resale by the broker-dealer for
                its
                account;

            

    

     

    
      	 	
              ·

            	
              an
                exchange distribution in accordance with the rules of the applicable
                exchange;

            

    

     

    
      	 	
              ·

            	
              privately
                negotiated transactions;

            

    

     

    
      	 	
              ·

            	
              settlement
                of short sales entered into after the effective date of the registration
                statement of which this prospectus is a
                part;

            

    

     

    
      	 	
              ·

            	
              broker-dealers
                may agree with the Selling Stockholders to sell a specified number
                of such
                shares at a stipulated price per
                share;

            

    

     

    
      	 	
              ·

            	
              through
                the writing or settlement of options or other hedging transactions,
                whether through an options exchange or otherwise;
                

            

    

     

    
      	 	
              ·

            	
              a
                combination of any such methods of sale;
                or

            

    

     

    
      	 	
              ·

            	
              any
                other method permitted pursuant to applicable
                law.

            

    

     

    The
      Selling Stockholders may also sell shares under Rule 144 under the Securities
      Act of 1933, as amended (the “Securities
      Act”),
      if
      available, rather than under this prospectus.

     

    Broker-dealers
      engaged by the Selling Stockholders may arrange for other brokers-dealers to
      participate in sales. Broker-dealers may receive commissions or discounts from
      the Selling Stockholders (or, if any broker-dealer acts as agent for the
      purchaser of shares, from the purchaser) in amounts to be negotiated, but,
      except as set forth in a supplement to this Prospectus, in the case of an agency
      transaction not in excess of a customary brokerage commission in compliance
      with
      NASDR Rule 2440; and in the case of a principal transaction a markup or markdown
      in compliance with NASDR IM-2440. 

     

    In
      connection with the sale of the common stock or interests therein, the Selling
      Stockholders may enter into hedging transactions with broker-dealers or other
      financial institutions, which may in turn engage in short sales of the common
      stock in the course of hedging the positions they assume. The Selling
      Stockholders may also sell shares of the common stock short and deliver these
      securities to close out their short positions, or loan or pledge the common
      stock to broker-dealers that in turn may sell these securities. The Selling
      Stockholders may also enter into option or other transactions with
      broker-dealers or other financial institutions or the creation of one or more
      derivative securities which require the delivery to such broker-dealer or other
      financial institution of shares offered by this prospectus, which shares such
      broker-dealer or other financial institution may resell pursuant to this
      prospectus (as supplemented or amended to reflect such
      transaction).

     

    The
      Selling Stockholders and any broker-dealers or agents that are involved in
      selling the shares may be deemed to be “underwriters” within the meaning of the
      Securities Act in connection with such sales. In such event, any commissions
      received by such broker-dealers or agents and any profit on the resale of the
      shares purchased by them may be deemed to be underwriting commissions or
      discounts under the Securities Act. Each Selling Stockholder has informed the
      Company that it does not have any written or oral agreement or understanding,
      directly or indirectly, with any person to distribute the Common Stock. In
      no
      event shall any broker-dealer receive fees, commissions and markups which,
      in
      the aggregate, would exceed eight percent (8%).

    
      
        
        

      

      
        -20-

        
          

        

      

      
        
        

      

    

     

    The
      Company is required to pay certain fees and expenses incurred by the Company
      incident to the registration of the shares. The Company has agreed to indemnify
      the Selling Stockholders against certain losses, claims, damages and
      liabilities, including liabilities under the Securities Act. 

     

    Because
      Selling Stockholders may be deemed to be “underwriters” within the meaning of
      the Securities Act, they will be subject to the prospectus delivery requirements
      of the Securities Act including Rule 172 thereunder. In addition, any securities
      covered by this prospectus which qualify for sale pursuant to Rule 144 under
      the
      Securities Act may be sold under Rule 144 rather than under this prospectus.
      There is no underwriter or coordinating broker acting in connection with the
      proposed sale of the resale shares by the Selling Stockholders.

     

    We
      agreed
      to keep this prospectus effective until the earlier of (i) the date on which
      the
      shares may be resold by the Selling Stockholders without registration and
      without regard to any volume limitations by reason of Rule 144(k) under the
      Securities Act or any other rule of similar effect or (ii) all of the shares
      have been sold pursuant to this prospectus or Rule 144 under the Securities
      Act
      or any other rule of similar effect. The resale shares will be sold only through
      registered or licensed brokers or dealers if required under applicable state
      securities laws. In addition, in certain states, the resale shares may not
      be
      sold unless they have been registered or qualified for sale in the applicable
      state or an exemption from the registration or qualification requirement is
      available and is complied with.

     

    Under
      applicable rules and regulations under the Exchange Act, any person engaged
      in
      the distribution of the resale shares may not simultaneously engage in market
      making activities with respect to the common stock for the applicable restricted
      period, as defined in Regulation M, prior to the commencement of the
      distribution. In addition, the Selling Stockholders will be subject to
      applicable provisions of the Exchange Act and the rules and regulations
      thereunder, including Regulation M, which may limit the timing of purchases
      and
      sales of shares of the common stock by the Selling Stockholders or any other
      person. We will make copies of this prospectus available to the Selling
      Stockholders and have informed them of the need to deliver a copy of this
      prospectus to each purchaser at or prior to the time of the sale (including
      by
      compliance with Rule 172 under the Securities Act).

    
      
        
        

      

      -21-

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