Document:

exhibit_10-4.htm

Exhibit 10.4

 

FORM OF

INDEMNIFICATION AGREEMENT

 

This Indemnification Agreement (this “Agreement”) dated the ___ day of ____, 20___ by and between Mannatech, Incorporated, a Texas corporation (the “Company”), and _______, an individual (“Indemnitee”).

 

RECITALS

 

A. Competent and experienced persons are reluctant to serve or to continue to serve as directors and officers of corporations or in other capacities unless they are provided with adequate protection through insurance or indemnification (or both) against claims against them arising out of their service and activities on behalf of the corporation.

 

B. The current uncertainties relating to the availability of adequate insurance have increased the difficulty for corporations of attracting and retaining competent and experienced persons to serve in such capacity.

 

C. The Board of Directors of the Company (the “Board of Directors”) has determined that the continuation of present trends in litigation will make it more difficult to attract and retain competent and experienced persons to serve as directors and officers of the Company, that this situation is detrimental to the best interests of the Company’s shareholders and that the Company should act to assure such persons that there will be increased certainty of adequate protection in the future.

 

D. As a supplement to and in the furtherance of the Company’s Articles of Incorporation, as amended (the “Articles”), and Bylaws, as amended (the “Bylaws”), it is reasonable, prudent, desirable and necessary for the Company contractually to obligate itself to indemnify, and to pay in advance expenses on behalf of, officers and directors to the fullest extent permitted by law so that they will serve or continue to serve the Company free from concern that they will not be so indemnified and that their expenses will not be so paid in advance.

 

E. This Agreement is not a substitute for, nor does it diminish or abrogate any rights of Indemnitee under, the Articles and the Bylaws or any resolutions adopted pursuant thereto (including any contractual rights of Indemnitee that may exist).

 

F. Indemnitee is a director of the Company and his or her willingness to continue to serve in such capacity is predicated, in substantial part, upon the Company’s willingness to indemnify him or her to the fullest extent permitted by the laws of the State of Texas and upon the other undertakings set forth in this Agreement.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the premises and covenants contained herein, and effective as of Indemnitee’s initial appointment as a director of the Company (the “Effective Date”), the Company and Indemnitee hereby agree as follows:

 

             ARTICLE I                   

CERTAIN DEFINITIONS

 

Capitalized terms used but not otherwise defined in this Agreement have the meanings set forth below:

 

“Controlled Affiliate” means any corporation, limited liability company, partnership, joint venture, trust or other Enterprise, whether or not for profit, that is directly or indirectly controlled by the Company.  For purposes of this definition, the term “control” means the possession, directly or indirectly, of the power to direct, or cause the direction of, the management or policies of an Enterprise, whether through the ownership of voting securities, through other voting rights, by contract or otherwise; provided, however, that direct or indirect beneficial ownership of capital stock or other interests in an Enterprise entitling the holder to cast 30% or more of the total number of votes generally entitled to be cast in the election of directors (or persons performing comparable functions) of such Enterprise will be deemed to constitute “control” for purposes of this definition.

 

“Corporate Status” means the status of a person who is or was a director, officer, employee, partner, member, manager, venturer, proprietor, trustee, fiduciary or agent of the Company or of any other Enterprise which such person is or was serving at the request of the Company.  In addition to any service at the actual request of the Company, Indemnitee will be deemed, for purposes of this Agreement, to be serving or to have served at the request of the Company as a director, officer, employee, partner, member, manager, venturer, proprietor, trustee, fiduciary or agent of another Enterprise if Indemnitee is or was serving as a director, officer, employee, partner, member, manager, venturer, proprietor, trustee, fiduciary or agent of such Enterprise and: (a) such Enterprise is or at the time of such service was a Controlled Affiliate; (b) such Enterprise is or at the time of such service was an employee benefit plan (or related trust) sponsored on maintained by the Company or a Controlled Affiliate; or (c) the Company or a Controlled Affiliate directly or indirectly caused Indemnitee to be nominated, elected, appointed, designated, employed, engaged or selected to serve in such capacity

 

“Disinterested Director” means a director of the Company who is not and was not a party to the Proceeding in respect of which indemnification is sought by Indemnitee.

 

“Enterprise” means the Company and any other corporation, partnership, limited liability company, joint venture, employee benefit plan, trust, other entity or other enterprise of which Indemnitee is or was serving at the request of the Company in a Corporate Status.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

 

“Expenses” means all attorney’s fees, disbursements and retainers, court costs, transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, fax transmission charges, secretarial services, delivery service fees and all other disbursements or expenses paid or incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing to be a witness in, or otherwise participating in, a Proceeding, or in connection with seeking indemnification under this Agreement.  Expenses will also include Expenses paid or incurred in connection with any appeal resulting from any Proceeding, including the premium, security for and other costs relating to any appeal bond or its equivalent.  Expenses, however, will not include amounts paid in settlement by Indemnitee or the amount of judgments or fines against Indemnitee.

 

“Incumbent Directors” means individuals who, as of the date of this Agreement, constitute the Board of Directors.

 

“Independent Counsel” means an attorney or firm of attorneys that is experienced in matters of corporation law and neither currently is, nor in the past five (5) years has been, retained to represent: (a) the Company or Indemnitee in any matter material to either such party (other than with respect to matters concerning the Indemnitee under this Agreement and/or the indemnification provisions of the Articles or Bylaws, or of other indemnitees under similar indemnification agreements); or (b) any other party to the Proceeding giving rise to a claim for indemnification hereunder.  Notwithstanding the foregoing, the term “Independent Counsel” does not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or Indemnitee in an action to determine Indemnitee’s rights under this Agreement.

 

“Losses” means any loss, liability, judgments, damages, amounts paid in settlement, fines (including excise taxes and penalties assessed with respect to employee benefit plans), penalties (whether civil, criminal or otherwise) and all interest, assessments and other charges paid or payable in connection with or in respect of any of the foregoing.

 

“Proceeding” means any threatened, pending or completed action, suit, claim, demand, arbitration, alternate dispute resolution mechanism, investigation, inquiry, administrative hearing or any other actual, threatened or completed proceeding, including any and all appeals, whether brought by or in the right of the Company or otherwise, whether civil, criminal, administrative, arbitrative or investigative, whether formal or informal, and in each case whether or not commenced prior to the date of this Agreement, in which Indemnitee was, is or will be involved as a party or otherwise, by reason of or relating to Indemnitee’s Corporate Status and by reason of or relating to either (i) any action or alleged action taken by Indemnitee (or failure or alleged failure to act) or of any action or alleged action (or failure or alleged failure to act)  on Indemnitee’s part, while acting in his or her Corporate Status or (ii) the fact that Indemnitee is or was serving at the request of the Company as director, officer, employee, partner, member, manager, trustee, fiduciary or agent of another Enterprise, in each case whether or not serving in such capacity at the time any Loss or Expense is paid or incurred for which indemnification or advancement of Expenses can be provided under this Agreement, except one initiated by Indemnitee to enforce his or her rights under this Agreement.  For purposes of this definition, the term “threatened” will be deemed to include Indemnitee’s good faith belief that a claim or other assertion may lead to institution of a Proceeding.

 

References to “serving at the request of the Company” include any service as a director, officer, employee or agent of the Company which imposes duties on, or involves services by, such director, officer, employee or agent with respect to any employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and in a manner he or she reasonably believed to be in the best interests of the participants and beneficiaries of an employee benefit plan will be deemed to have acted in a manner “not opposed to the best interests of the Company” as referred to under applicable law or in this Agreement.

 

       ARTICLE II         

SERVICES TO THE COMPANY

 

2.1 Services to the Company.   Indemnitee agrees to serve as a director of the Company.  Indemnitee may at any time and for any reason resign from such position (subject to any other contractual obligation or any obligation imposed by operation of law), in which event the Company will have no obligation under this Agreement to continue Indemnitee in such position.  This Agreement will not be construed as giving Indemnitee any right to be retained in the employ of the Company (or any other Enterprise).

 

ARTICLE III

INDEMNIFICATION

 

3.1 Indemnification of Indemnitee.  Except as otherwise set forth in this ‎Article III, the Company hereby agrees to hold harmless and indemnify Indemnitee against any and all Expenses and Losses and causes of action of every kind, regardless of the sole, joint or concurrent negligence, negligence per se, gross negligence, statutory fault, or strict liability of Indemnitee to the fullest extent permitted by law and the Articles and Bylaws, as the same exists or may hereafter be amended interpreted or replaced (but in the case of any such amendment, interpretation or replacement, only to the extent that such amendment, interpretation or replacement permits the Company to provide broader indemnification rights than were permitted prior thereto).  For purposes of this Agreement, the meaning of the phrase “to the fullest extent permitted by law” will include to the fullest extent permitted by Chapter 8 of Title I of the Texas Corporation Law (the “TCL”) or any chapter that replaces or succeeds Chapter 8 of the TCL with respect to such matters. In furtherance of the foregoing indemnification, and without limiting the generality thereof:

 

(a) Indemnitee shall be entitled to the rights of indemnification provided in this Section ‎3.1‎(a) if, by reason of his Corporate Status, the Indemnitee was, is or becomes a party to, or was or is threatened to be made a party to, or was or is otherwise involved in, any Proceeding (as hereinafter defined) other than a Proceeding covered by Section ‎3.1‎(b), which shall be governed by the terms contained therein. Pursuant to this Section ‎3.1‎(a), Indemnitee shall be indemnified against all Expenses and Losses (including any excise taxes or similar taxes), together with any federal, state, local or foreign taxes imposed as a result of the actual or deemed receipt of any payments under this Agreement, that are reasonably and actually incurred by Indemnitee, or on his behalf, in connection with such Proceeding if the Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interest of the Company, with respect to any criminal Proceeding, had no reasonable cause to believe Indemnitee’s conduct was unlawful, and the amount of Expenses incurred (whether actually or deemed) are reasonable.  Notwithstanding the foregoing, the Company shall indemnify Indemnitee against all reasonable Expenses actually incurred by Indemnitee in connection with a Proceeding in which Indemnitee is a respondent because the person is or was a director of the Company if Indemnitee is wholly successful, on the merits or otherwise, in the defense of such Proceeding.

 

(b) Indemnitee shall be entitled to the rights of indemnification provided in this Section ‎3.1‎(b) if, by reason of his Corporate Status, the Indemnitee was, is or becomes a party to, or was or is threatened to be made a party to, or was or is otherwise involved in, any Proceeding brought by or in the right of the Company where, as a result of such Proceeding, Indemnitee is found liable to the Company or alternatively, to have received an improper personal benefit. Pursuant to this Section ‎3.1‎(b), Indemnitee shall be indemnified against all reasonable Expenses (excluding any excise taxes or similar taxes) that are actually incurred by Indemnitee or on Indemnitee’s behalf in connection with such Proceeding, together with any federal, state, local or foreign taxes imposed as a result of the actual receipt of any payments under this Agreement; provided, however, no indemnification against such Expenses shall be made in respect of any claim, issue or matter in such Proceeding as to which Indemnitee shall have been adjudged liable for: willful or intentional misconduct in the performance of Indemnitee’s duty to the Company, breach of Indemnitee’s duty of loyalty owed to the Company or commission by Indemnitee of an act or omission by Indemnitee not committed in good faith that constitutes a breach of a duty owed by Indemnitee to the Company.

 

3.2 Indemnification for Expenses of a Witness.  Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason of his Corporate Status, a witness in any Proceeding to which Indemnitee is not a party, the Company will indemnify Indemnitee against all Expenses actually and reasonably paid or incurred by Indemnitee on his or her behalf in connection therewith.

 

3.3 Exclusions.  Notwithstanding any other provision of this Agreement, the Company will not be obligated under this Agreement to provide indemnification in connection with the following:

 

(a) any Proceeding (or part of any Proceeding) initiated or brought voluntarily by Indemnitee against the Company or its directors, officers, employees or other indemnities, unless a majority of Disinterested Directors, even though less than a quorum of the Board of Directors, has authorized or consented to the initiation of the Proceeding (or such part of any Proceeding); provided, however, that nothing in this Section ‎3.3‎(a) shall limit the right of Indemnitee to be indemnified under Section ‎8.4; or

 

(b) for an accounting of profits made from the purchase and sale (or sale and purchase) by Indemnitee of securities of the Company within the meaning of Section 16(b) of the Exchange Act or any similar successor statute.

 

     ARTICLE IV        

ADVANCEMENT OF EXPENSES

 

4.1 Expense Advances. Except as set forth in Section ‎4.2, the Company will, if requested by Indemnitee, advance, to the fullest extent permitted by law, to Indemnitee (hereinafter an “Expense Advance”) any and all Expenses actually and reasonably paid or incurred by Indemnitee in connection with any Proceeding (whether prior to or after its final disposition).  Indemnitee’s right to each Expense Advance will be made without regard to Indemnitee’s ultimate entitlement to indemnification under the other provisions of this Agreement, or under provisions of the Articles or Bylaws or otherwise.  Each Expense Advance will be unsecured and interest free and will be made by the Company without regard to Indemnitee’s ability to repay the Expense Advance; provided, however, that an Expense Advance will be made only upon delivery to the Company of a written affirmation by Indemnitee of such Indemnitee’s good faith belief that Indemnitee has met the standard of conduct necessary for indemnification under the TCL and a written undertaking (hereinafter an “Undertaking”), by or on behalf of Indemnitee, to repay such Expense Advance if it is ultimately determined, by final decision by a court or arbitrator, as applicable, from which there is no further right to appeal, that Indemnitee has not met the standard of conduct necessary for indemnification under the TCL or is not entitled to be indemnified for such Expenses under the Articles, Bylaws, the TCL this Agreement or otherwise.  An Expense eligible for an Expense Advance will include any and all reasonable Expenses incurred pursuing an action to enforce the right of advancement provided for in this ‎Article IV, including Expenses incurred preparing and forwarding statements to the Company to support the Expense Advances claimed.

 

4.2 Exclusions.  Indemnitee will not be entitled to any Expense Advance in connection with any of the matters for which indemnity is excluded pursuant to Section ‎3.3.

 

4.3 Timing.  An Expense Advance pursuant to Section ‎4.1 will be made within ten business days after the receipt by the Company of a written statement or statements from Indemnitee requesting such Expense Advance (which statement or statements will include, if requested by the Company, reasonable detail underlying the Expenses for which the Expense Advance is requested), whether such request is made prior to or after final disposition of such Proceeding.  Such request must be accompanied by all information required by Section ‎4.1, including but not limited to, the Undertaking.

 

ARTICLE V

CONTRIBUTION IN THE EVENT OF JOINT LIABILITY

 

5.1 Contribution by Company.  To the fullest extent permitted by law, if the indemnification provided for in this Agreement is unavailable to Indemnitee for any reason whatsoever, the Company, in lieu of indemnifying Indemnitee, will contribute to the amount of Expenses and Losses actually and reasonably incurred or paid by Indemnitee in connection with any Proceeding in proportion to the relative benefits received by the Company and all officers, directors and employees of the Company other than Indemnitee who are jointly liable with Indemnitee (or would be if joined in such Proceeding), on the one hand, and Indemnitee, on the other hand, from the transaction from which such Proceeding arose; provided, however, that the proportion determined on the basis of relative benefit may, to the extent necessary to conform to law, be further adjusted by reference to the relative fault of the Company and all officers, directors and employees of the Company other than Indemnitee who are jointly liable with Indemnitee (or would be if joined in such Proceeding), on the one hand, and Indemnitee, on the other hand, in connection with the events that resulted in such Expenses and Losses, as well as any other equitable considerations which applicable law may require to be considered.  The relative fault of the Company and all officers, directors and employees of the Company other than Indemnitee who are jointly liable with Indemnitee (or would be if joined in such Proceeding), on the one hand, and Indemnitee, on the other hand, will be determined by reference to, among other things, the degree to which their actions were motivated by intent to gain personal profit or advantage, the degree to which their liability is primary or secondary, and the degree to which their conduct was active or passive.

 

5.2 Indemnification for Contribution Claims by Others.  To the fullest extent permitted by law, the Company will fully indemnify and hold Indemnitee harmless from any claims of contribution which may be brought by other officers, directors or employees of the Company who may be jointly liable with Indemnitee for any Loss or Expense arising from a Proceeding.

 

         ARTICLE VI              

PROCEDURES AND PRESUMPTIONS FOR THE

DETERMINATION OF ENTITLEMENT TO INDEMNIFICATION

 

6.1 Notification of Claims; Request for Indemnification.  Indemnitee agrees to notify promptly the Company in writing of any claim made against Indemnitee for which indemnification will or could be sought under this Agreement; provided, however, that a delay in giving such notice will not deprive Indemnitee of any right to be indemnified under this Agreement unless, and then only to the extent that, the Company did not otherwise learn of the Proceeding and such delay is materially prejudicial to the Company’s ability to defend such Proceeding; and, provided, further, that notice will be deemed to have been given without any action on the part of Indemnitee in the event the Company is a party to the same Proceeding.  The omission to notify the Company will not relieve the Company from any liability for indemnification that it may have to Indemnitee otherwise than under this Agreement.  Indemnitee may deliver to the Company a written request to have the Company indemnify and hold harmless Indemnitee in accordance with this Agreement.  Following such a written request for indemnification, Indemnitee’s entitlement to indemnification shall be determined according to Section ‎6.1.  The Secretary of the Company will, promptly upon receipt of such a request for indemnification, advise the Board of Directors in writing that Indemnitee has requested indemnification. The Company will be entitled to participate in any Proceeding at its own expense.

 

6.2 Determination of Right to Indemnification.  Upon written request by Indemnitee for indemnification pursuant to Section ‎6.1 hereof with respect to any Proceeding, a determination, if, but only if, required by applicable law, with respect to Indemnitee’s entitlement thereto will be made by one of the following, at the election of Indemnitee:  (a) so long as there are Disinterested Directors with respect to such Proceeding, a majority vote of the Disinterested Directors, even though less than a quorum of the Board of Directors; (b) so long as there are Disinterested Directors with respect to such Proceeding, a committee of such Disinterested Directors designated by a majority vote of such Disinterested Directors, even though less than a quorum of the Board of Directors; (c) Independent Counsel in a written opinion delivered to the Board of Directors, a copy of which will also be delivered to Indemnitee; (d) the Company’s shareholders, which shall exclude any shareholder who is not disinterested and independent with respect to the matters underlying the Proceeding; or (e) the unanimous vote of the Company’s shareholders.  The election by Indemnitee to use a particular person, persons or entity to make such determination is to be included in the written request for indemnification submitted by Indemnitee (and if no election is made in the request it will be assumed that Indemnitee has elected the Independent Counsel to make such determination).  The person, persons or entity chosen to make a determination under this Agreement of the Indemnitee’s entitlement to indemnification will act reasonably and in good faith in making such determination.

 

6.3 Selection of Independent Counsel.  If the determination of entitlement to indemnification pursuant to Section ‎6.2 will be made by an Independent Counsel, the Independent Counsel will be selected by: (a) so long as there are Disinterested Directors with respect to such Proceeding, a majority vote of the Disinterested Directors, even though less than a quorum of the Board of Directors; or (b) so long as there are Disinterested Directors with respect to such Proceeding, a committee of such Disinterested Directors designated by a majority vote of such Disinterested Directors, even though less than a quorum of the Board of Directors. 

 

6.4 Burden of Proof.  In making a determination with respect to entitlement to indemnification hereunder, the person, persons or entity making such determination will presume that Indemnitee is entitled to indemnification under this Agreement.  Anyone seeking to overcome this presumption will have the burden of proof and the burden of persuasion, by clear and convincing evidence. In making a determination with respect to entitlement to indemnification hereunder which under this Agreement, the Articles, Bylaws or applicable law requires a determination of Indemnitee’s good faith and/or whether Indemnitee acted in a manner which he or she reasonably believed to be in or not opposed to the best interests of the Company and in the case of a criminal Proceeding, Indemnitee did not have any reasonable cause to believe Indemnitee’s conduct was unlawful. The person, persons or entity making such determination will presume that Indemnitee has at all times acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the Company or, if applicable in the case of a criminal Proceeding, Indemnitee did not have any reasonable cause to believe Indemnitee’s conduct was unlawful. Anyone seeking to overcome this presumption will have the burden of proof and the burden of persuasion, by clear and convincing evidence. Indemnitee will be deemed to have acted in good faith if Indemnitee’s action with respect to a particular Enterprise is based on the records or books of account of such Enterprise, including financial statements, or on information supplied to Indemnitee by the officers of such Enterprise in the course of their duties, or on the advice of legal counsel for such Enterprise or on information or records given or reports made to such Enterprise by an independent certified public accountant or by an appraiser or other expert selected by such Enterprise; provided, however this sentence will not be deemed to  limit in any way the other circumstances in which Indemnitee may be deemed to have met such standard of conduct.  In addition, the knowledge and/or actions, or failure to act, of any other director, officer, agent or employee of such Enterprise will not be imputed to Indemnitee for purposes of determining the right to indemnification under this Agreement.

 

6.5 No Presumption in Absence of a Determination or As Result of an Adverse Determination; Presumption Regarding Success.  Neither the failure of any person, persons or entity chosen to make a determination as to whether Indemnitee has met any particular standard of conduct or had any particular belief to make such determination, nor an actual determination by such person, persons or entity that Indemnitee has not met such standard of conduct or did not have such belief, prior to or after the commencement of legal proceedings by Indemnitee to secure a judicial determination that Indemnitee should be indemnified under this Agreement under applicable law, will be a defense to Indemnitee’s claim or create a presumption that Indemnitee has not met any particular standard of conduct or did not have any particular belief.  In addition, the termination of any Proceeding by judgment, order, settlement (whether with or without court approval) or conviction, or upon a plea of nolo contendere, or its equivalent, will not create a presumption that Indemnitee did not meet any particular standard of conduct or have any particular belief or that a court has determined that indemnification is not permitted by this Agreement or applicable law.  In the event that any Proceeding to which Indemnitee is a party is resolved in any manner other than by final adverse judgment (as to which all rights of appeal therefrom have been exhausted or lapsed) against Indemnitee (including, without limitation, settlement of such Proceeding with or without payment of money or other consideration) it will be presumed that Indemnitee has been successful on the merits or otherwise in such Proceeding.  Anyone seeking to overcome this presumption will have the burden of proof and the burden of persuasion, by clear and convincing evidence.

 

6.6 Timing of Determination.  The Company will use its reasonable best efforts to cause any determination required to be made pursuant to Section ‎6.2 to be made as promptly as practicable after Indemnitee has submitted a written request for indemnification pursuant to Section ‎6.1.  If the person, persons or entity chosen to make a determination does not make such determination within thirty (30) days after the later of the date (a) the Company receives Indemnitee’s request for indemnification pursuant to Section ‎6.1 and (b) on which an Independent Counsel is selected pursuant to Section ‎6.3, if applicable, the requisite determination of entitlement to indemnification will be deemed to have been made and Indemnitee will be entitled to such indemnification, so long as (i) Indemnitee has fulfilled his or her obligations pursuant to Section ‎6.8 and (ii) such indemnification is not prohibited under applicable law; provided, however, that such 30 day period may be extended for a reasonable time, not to exceed an additional fifteen (15) days, if the person, persons or entity making the determination with respect to entitlement to indemnification in good faith requires such additional time for the obtaining of or evaluating of documentation and/or information relating thereto.

 

6.7 Timing of Payments.  All payments of Expenses, including any Expense Advance, and other amounts by the Company to the Indemnitee pursuant to this Agreement will be made as soon as practicable after a written request or demand therefor by Indemnitee is presented to the Company, but in no event later than thirty (30) days after (i) such demand is presented or (ii) such later date as a determination of entitlement to indemnification is made in accordance with  Section ‎6.6, if applicable; provided, however, that an Expense Advance will be made within the time provided in Section ‎4.3 hereof.

 

6.8 Cooperation.  Indemnitee will cooperate with the person, persons or entity making a determination with respect to Indemnitee’s entitlement to indemnification, including providing to such person, persons or entity, upon reasonable advance request, any documentation or information which is not privileged or otherwise protected from disclosure and which is reasonably available to Indemnitee and reasonably necessary to such determination.  Any Expenses  incurred by Indemnitee in so cooperating with the person, persons or entity making such determination will be borne by the Company (irrespective of the determination as to Indemnitee’s entitlement to indemnification) and the Company will indemnify Indemnitee therefor and will hold Indemnitee harmless therefrom.

 

6.9 Time for Submission of Request.  Indemnitee will be required to submit any request for indemnification pursuant to this ‎Article VI within a reasonable time, not to exceed two years, after any judgment, order, settlement, dismissal, arbitration award, conviction, acceptance of a plea of nolo contendere (or its equivalent) or other full or partial final determination or disposition of the Proceeding (with the latest date of the occurrence of any such event to be considered the commencement of the two-year period).

 

ARTICLE VII

LIABILITY INSURANCE

 

7.1 Company Insurance.  Subject to Section ‎7.3, the Company will obtain and maintain a policy or policies of insurance with one or more reputable insurance companies  providing Indemnitee with coverage in such amount as will be determined by the Board of Directors for Losses and Expenses paid or incurred by Indemnitee as a result of acts or omissions of Indemnitee in his or her Corporate Status, and to ensure the Company’s performance of its indemnification obligations under this Agreement; provided, however, in all policies of director and officer liability insurance obtained by the Company, Indemnitee will be named as an insured party in such manner as to provide Indemnitee with the same rights and benefits as are afforded to the most favorably insured directors or officers, as applicable, of the Company under such policies; provided, however, the Company may obtain additional insurance coverage for “independent directors” (within the meaning of the corporate governance rules of the Nasdaq National Market) without providing Indemnitee with the same rights and benefits afforded to the independent directors under such policy unless, at the time the policy is obtained, Indemnitee is insurable as an independent director.  Any reductions to the amount of director and officer liability insurance coverage maintained by the Company as of the date hereof will be subject to the approval of a majority of the Incumbent Directors.

 

7.2 Notice to Insurers.  If, at the time of receipt by the Company of a notice from any source of a Proceeding as to which Indemnitee is a party or participant, the Company will give prompt notice of such Proceeding to the insurers in accordance with the procedures set forth in the respective policies, and the Company will provide Indemnitee with a copy of such notice and copies of all subsequent correspondence between the Company and such insurers related thereto.  The Company will thereafter take all necessary or desirable actions to cause such insurers to pay, on behalf of Indemnitee, all amounts payable as a result of such Proceeding in accordance with the terms of such policies.

 

7.3 Insurance Not Required.  Notwithstanding Section ‎7.1, the Company will have no obligation to obtain or maintain the insurance contemplated by Section ‎7.1 if a majority of the Incumbent Directors determines in good faith that such insurance is not reasonably available, if the premium costs for such insurance are disproportionately high compared to the amount of coverage provided, or if the coverage provided by such insurance is limited by exclusions so as to provide an insufficient benefit.  The Company will promptly notify Indemnitee of any such determination not to provide insurance coverage.

 

          ARTICLE VIII               

REMEDIES OF INDEMNITEE

 

8.1 Action by Indemnitee.  In the event that (i) a determination is made pursuant to ‎Article VI of this Agreement that Indemnitee is not entitled to indemnification under this Agreement, (ii) an Expense Advance is not timely made pursuant to Section ‎4.3 of this Agreement, (iii) no determination  of entitlement to indemnification is made within the applicable time periods specified in Section ‎6.6 or (iv) payment of indemnified amounts is not made within the applicable time periods specified in Section ‎6.7, Indemnitee will be entitled to an adjudication in an appropriate court of the State of Texas, or in any other court of competent jurisdiction, of his or her entitlement to such indemnification or payment of an Expense Advance.  Alternatively, Indemnitee, at Indemnitee’s option, may seek an award in arbitration to be conducted by a single arbitrator pursuant to the Commercial Arbitration Rules of the American Arbitration Association.  The provisions of Texas law (without regard to its conflict of laws rules) will apply to any such arbitration.  The Company will not oppose Indemnitee’s right to seek any such adjudication or award in arbitration.

 

8.2 De Novo Review if Prior Adverse Determination.  In the event that a determination is made pursuant to ‎Article VI that Indemnitee is not entitled to indemnification, any judicial proceeding or arbitration commenced pursuant to this ‎Article VIII will be conducted in all respects as a de novo trial or arbitration, as applicable, on the merits and Indemnitee will not be prejudiced by reason of that adverse determination.  In any judicial proceeding or arbitration commenced pursuant to this ‎Article VIII, Indemnitee will be presumed to be entitled to indemnification under this Agreement, the Company will have the burden of proving Indemnitee is not entitled to indemnification and the Company may not refer to or introduce evidence of any determination pursuant to ‎Article VI adverse to Indemnitee for any purpose.  If Indemnitee commences a judicial proceeding or arbitration pursuant to this ‎Article VIII,  Indemnitee will not be required to reimburse the Company for any Expense Advance made pursuant to ‎Article IV until a final determination is made with respect to Indemnitee’s entitlement to indemnification (as to which all rights of appeal have been exhausted or lapsed).

 

8.3 Company Bound by Favorable Determination by Reviewing Party.  If a determination is made that Indemnitee is entitled to indemnification pursuant to ‎Article VI, the Company will be bound by such determination in any judicial proceeding or arbitration commenced pursuant to this ‎Article VIII, absent (i) a misstatement by Indemnitee of a material fact or an omission of a material fact necessary to make Indemnitee’s statements in connection with the request for indemnification not materially misleading or (ii) a prohibition of such indemnification under law.

 

8.4 Company Bears Expenses if Indemnitee Seeks Adjudication.  In the event that Indemnitee, pursuant to this ‎Article VIII, seeks a judicial adjudication or arbitration of his or her rights under, or to recover damages for breach of, this Agreement, any other agreement for indemnification, the indemnification or advancement of expenses provisions in the Articles or Bylaws, payment of Expenses in advance or contribution hereunder or to recover under any director and officer liability insurance policies maintained by the Company, the Company will, to the fullest extent permitted by law, indemnify and hold harmless Indemnitee against any and all Expenses which are paid or incurred by Indemnitee in connection with such judicial adjudication or arbitration, regardless of whether Indemnitee ultimately is determined to be entitled to such indemnification, payment of Expenses in advance or contribution or insurance recovery.  In addition, if requested by Indemnitee, the Company will (within ten days after receipt by the Company of the written request therefor), pay as an Expense Advance such Expenses, to the fullest extent permitted by law.

 

8.5 Company Bound by Provisions of this Agreement.  The Company will be precluded from asserting in any judicial or arbitration proceeding commenced pursuant to this ‎Article VIII that the procedures and presumptions of this Agreement are not valid, binding and enforceable and will stipulate in any such judicial or arbitration proceeding that the Company is bound by all the provisions of this Agreement.

 

ARTICLE IX

NON-EXCLUSIVITY, SUBROGATION; NO DUPLICATIVE PAYMENTS;

MORE FAVORABLE TERMS

 

9.1 Non-Exclusivity.  The rights of indemnification and to receive Expense Advances as provided by this Agreement will not be deemed exclusive of any other rights to which Indemnitee may at any time be entitled under applicable law, the Articles, the Bylaws, any agreement, a vote of shareholders, a resolution of the directors or otherwise.  To the extent Indemnitee otherwise would have any greater right to indemnification or payment of any advancement of Expenses under any other provisions under applicable law, the Articles, Bylaws, any agreement, vote of shareholders, a resolution of directors or otherwise, Indemnitee will be entitled under this Agreement to such greater right.  No amendment, alteration or repeal of this Agreement or of any provision hereof limits or restricts any right of Indemnitee under this Agreement in respect of any action taken or omitted by such Indemnitee prior to such amendment, alteration or repeal.  To the extent that a change in the TCL, whether by statute or judicial decision, permits greater indemnification than would be afforded currently under the Articles, Bylaws and this Agreement, it is the intent of the parties hereto that Indemnitee enjoy by this Agreement the greater benefits so afforded by such change.  No right or remedy herein conferred is intended to be exclusive of any other right or remedy, and every other right and remedy will be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise.  The assertion or employment of any right or remedy hereunder, or otherwise, will not prevent the concurrent assertion or employment of any other right or remedy.

 

9.2 Subrogation.  In the event of any payment by the Company under this Agreement, the Company will be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee with respect thereto and Indemnitee will execute all papers required and take all action necessary to secure such rights, including execution of such documents as are necessary to enable the Company to bring suit to enforce such rights (it being understood that all of Indemnitee’s reasonable Expenses related thereto will be borne by the Company).

 

9.3 No Duplicative Payments.  The Company will not be liable under this Agreement to make any payment of amounts otherwise indemnifiable (or any Expense for which advancement is provided) hereunder if and to the extent that Indemnitee has otherwise actually received such payment under any insurance policy, contract, agreement or otherwise.  The Company’s obligation to indemnify or advance Expenses hereunder to Indemnitee in respect of Proceedings relating to Indemnitee’s service at the request of the Company as a director, officer, employee, partner, member, manager, venturer, proprietor, trustee, fiduciary or agent of any other Enterprise will be reduced by any amount Indemnitee has actually received as indemnification or advancement of Expenses from such other Enterprise.

 

9.4 More Favorable Terms.  In the event the Company enters into an indemnification agreement with another officer or director, as the case may be, containing terms more favorable to the indemnitee thereof than the terms contained herein (and absent special circumstances justifying such more favorable terms), Indemnitee will be afforded the benefit of such more favorable terms and such more favorable terms will be deemed incorporated by reference herein as if set forth in full herein.  As promptly as practicable following the execution thereof, the Company will (a) send a copy of the agreement containing more favorable terms to Indemnitee, and (b) prepare, execute and deliver to Indemnitee an amendment to this Agreement containing such more favorable terms.

 

         ARTICLE X         

DEFENSE OF PROCEEDINGS

 

10.1 Company Assuming the Defense.  Subject to Section ‎10.3 below, in the event the Company is obligated to pay in advance the Expenses of any Proceeding pursuant to ‎Article IV, the Company will be entitled, by written notice to Indemnitee, to assume the defense of such Proceeding, with counsel approved by Indemnitee, which approval will not be unreasonably withheld.  The Company will identify the counsel it proposes to employ in connection with such defense as part of the written notice sent to Indemnitee notifying Indemnitee of the Company’s election to assume such defense, and Indemnitee will be required, within ten days following Indemnitee’s receipt of such notice, to inform the Company of its approval of such counsel or, if it has objections, the reasons therefor.  If such objections cannot be resolved by the parties, the Company will identify alternative counsel, which counsel will also be subject to approval by Indemnitee in accordance with the procedure described in the prior sentence.

 

10.2 Right of Indemnitee to Employ Counsel.  Following approval of counsel by Indemnitee pursuant to Section ‎10.1 and retention of such counsel by the Company, the Company will not be liable to Indemnitee under this Agreement for any fees and expenses of counsel subsequently incurred by Indemnitee with respect to the same Proceeding; provided, however, that (a) Indemnitee has the right to employ counsel in any such Proceeding at Indemnitee’s expense and (b) the Company will be required to pay the  fees and expenses of Indemnitee’s counsel if (i) the employment of counsel by Indemnitee has been previously authorized by the Company, (ii) Indemnitee reasonably concludes that there is an actual or potential conflict between the Company (or any other person or persons included in a joint defense) and Indemnitee in the conduct of such defense or representation by such counsel retained by the Company or (iii) the Company does not continue to retain the counsel approved by Indemnitee.

 

10.3 Company Not Entitled to Assume Defense.  Notwithstanding Section ‎10.1, the Company will not be entitled to assume the defense of any Proceeding brought by or on behalf of the Company or any Proceeding as to which Indemnitee has reasonably made the conclusion provided for in Section ‎10.2(b)(ii).

 

ARTICLE XI

SETTLEMENT

 

11.1 Company’s Prior Consent Required.  Notwithstanding anything in this Agreement to the contrary, the Company will have no obligation to indemnify Indemnitee under this Agreement for any amounts paid in settlement of any Proceeding effected without the Company’s prior written consent.

 

11.2 When Indemnitee’s Prior Consent Required.  The Company will not, without the prior written consent of Indemnitee, consent to the entry of any judgment against Indemnitee or enter into any settlement or compromise which (i) includes an admission of fault of Indemnitee, any non-monetary remedy imposed on Indemnitee or a Loss for which Indemnitee is not wholly indemnified hereunder or (ii) with respect to any Proceeding with respect to which Indemnitee may be or is made a party or a participant or may be or is otherwise entitled to seek indemnification hereunder, does not include, as an unconditional term thereof, the full release of Indemnitee from all liability in respect of such Proceeding, which release will be in form and substance reasonably satisfactory to Indemnitee.  Neither the Company nor Indemnitee will unreasonably withhold its consent to any proposed settlement; provided, however, Indemnitee may withhold consent to any settlement that does not provide a full and unconditional release of Indemnitee from all liability in respect of such Proceeding.

 

          ARTICLE XII              

DURATION OF AGREEMENT

 

12.1 Duration of Agreement.  This Agreement will continue until and terminate upon the latest of (a) the statute of limitations applicable to any claim that could be asserted against an Indemnitee with respect to which Indemnitee may be entitled to indemnification and/or an Expense Advance under this Agreement, (b) ten years after the date that Indemnitee has ceased to serve as a director or officer of the Company or as a director, officer, employee, partner, member, manager, fiduciary or agent of any other Enterprise which Indemnitee served at the request of the Company, or (c) if, at the later of the dates referred to in (a) and (b) above, there is pending a Proceeding in respect of which Indemnitee is granted rights of indemnification or the right to an Expense Advance under this Agreement or a Proceeding commenced by Indemnitee pursuant to ‎Article VIII of this Agreement, one year after the final termination of such Proceeding, including any and all appeals.

 

ARTICLE XIII

MISCELLANEOUS

 

13.1 Entire Agreement.  This Agreement constitutes the entire agreement and understanding of the parties in respect of the subject matter hereof and supersedes all prior understandings, agreements or representations by or among the parties, written or oral, to the extent they relate in any way to the subject matter hereof; provided, however, it is agreed that the provisions contained in this Agreement are a supplement to, and not a substitute for, any provisions regarding the same subject matter contained in the Articles, the Bylaws and any employment or similar agreement between the parties.

 

13.2 Assignment; Binding Effect; Third Party Beneficiaries. No party may assign either this Agreement or any of its rights, interests or obligations hereunder without the prior written approval of the other party and any such assignment by a party without prior written approval of the other parties will be deemed null and void, have no effect and not binding on such other parties; provided, however, that the Company may assign all (but not less than all) of its rights, obligations and interests hereunder to any direct or indirect successor to all or substantially all of the business or assets of the Company by purchase, merger, consolidation or otherwise and will cause such successor to be bound by and expressly assume the terms and provisions hereof.  All of the terms, agreements, covenants, representations, warranties and conditions of this Agreement are binding upon, and inure to the benefit of and are enforceable by, the parties and their respective successors, permitted assigns, heirs, executors and personal and legal representatives.  There are no third party beneficiaries having rights under or with respect to this Agreement.

 

13.3 Notices.  All notices, requests and other communications provided for or permitted to be given under this Agreement must be in writing and be given by personal delivery, by certified or registered United States mail (postage prepaid, return receipt requested), by a nationally recognized overnight delivery service for next day delivery, or by facsimile transmission, as follows (or to such other address as any party may give in a notice given in accordance with the provisions hereof):

 

If to the Company:

 

Mannatech, Incorporated

600 S. Royal Lane, Suite 200

Coppell, Texas 75019

Attention:  Chief Legal Officer

 

Facsimile:  (972) 471-7387

 

If to Indemnitee:

 

 

 

___________________

 

___________________

 

___________________

 

Facsimile: __________

 

All notices, requests or other communications will be effective and deemed given only as follows:  (i) if given by personal delivery, upon such personal delivery, (ii) if sent by certified or registered mail, on the fifth business day after being deposited in the United States mail, (iii) if sent for next day delivery by overnight delivery service, on the date of delivery as confirmed by written confirmation of delivery, (iv) if sent by facsimile, upon the transmitter’s confirmation of receipt of such facsimile transmission, except that if such confirmation is received after 5:00 p.m. (in the recipient’s time zone) on a business day, or is received on a day that is not a business day, then such notice, request or communication will not be deemed effective or given until the next succeeding business day.  Notices, requests and other communications sent in any other manner, including by electronic mail, will not be effective.

 

13.4 Specific Performance; Remedies.  Each party acknowledges and agrees that the other party would be damaged irreparably if any provision of this Agreement were not performed in accordance with its specific terms or were otherwise breached.  Accordingly, the parties will be entitled to an injunction or injunctions to prevent breaches of the provisions of this Agreement and to enforce specifically this Agreement and its provisions, in addition to any other remedy to which they may be entitled, at law or in equity.  Except as expressly provided herein, the rights, obligations and remedies created by this Agreement are cumulative and in addition to any other rights, obligations or remedies otherwise available at law or in equity.  Except as expressly provided herein, nothing herein will be considered an election of remedies.

 

13.5 Submission to Jurisdiction. Any Proceeding seeking to enforce any provision of, or based on any matter arising out of or in connection with, this Agreement may only be brought in a federal or state court sitting in Dallas County, Texas, which will be the exclusive and only proper forum for adjudicating such Proceeding, and each party consents to the exclusive jurisdiction and venue of such court (and of the appropriate appellate courts therefrom) in any such Proceeding and irrevocably waives, to the fullest extent permitted by law, any objection that it may now or hereafter have to the laying of the venue of any such  Proceeding in any such court or that any such Proceeding brought in any such court has been brought in an inconvenient forum.  Process in any such action, suit or proceeding may be served on any party anywhere in the world, whether within or without the jurisdiction of any such court.

 

13.6 Headings.  The article and section headings contained in this Agreement are inserted for convenience only and will not affect in any way the meaning or interpretation of this Agreement.

 

13.7 Governing Law.  This Agreement will be governed by and construed in accordance with the laws of the State of Texas, without giving effect to any choice of law principles.

 

13.8 Amendment.  This Agreement may not be amended or modified except by a writing signed by all of the parties.

 

13.9 Extensions; Waivers.  Any party may, for itself only, (i) extend the time for the performance of any of the obligations of any other party under this Agreement, (ii) waive any inaccuracies in the representations and warranties of any other party contained herein or in any document delivered pursuant hereto and (iii) waive compliance with any of the agreements or conditions for the benefit of such party contained herein.  Any such extension or waiver will be valid only if set forth in a writing signed by the party to be bound thereby.  No waiver by any party of any default, misrepresentation or breach of warranty or covenant hereunder, whether intentional or not, may be deemed to extend to any prior or subsequent default, misrepresentation or breach of warranty or covenant hereunder or affect in any way any rights arising because of any prior or subsequent such occurrence. Neither the failure nor any delay on the part of any party to exercise any right or remedy under this Agreement will operate as a waiver thereof, nor will any single or partial exercise of any right or remedy preclude any other or further exercise of the same or of any other right or remedy.

 

13.10 Severability.  The provisions of this Agreement will be deemed severable and the invalidity or unenforceability of any provision will not affect the validity or enforceability of the other provisions hereof; provided that if any provision of this Agreement, as applied to any party or to any circumstance, is judicially determined not to be enforceable in accordance with its terms, the parties agree that the court judicially making such determination may modify the provision in a manner consistent with its objectives such that it is enforceable, and/or to delete specific words or phrases, and in its modified form, such provision will then be enforceable and will be enforced.

 

13.11 Counterparts; Effectiveness.  This Agreement may be executed in two or more counterparts, each of which will be deemed an original but all of which together will constitute one and the same instrument.  This Agreement will become effective when one or more counterparts have been signed by each of the parties and delivered to the other parties, which delivery may be made by exchange of copies of the signature page by facsimile transmission.  For purposes of determining whether a party has signed this Agreement or any document contemplated hereby or any amendment or waiver hereof, only a handwritten signature on a paper document or a facsimile transmission of a handwritten original signature will constitute a signature, notwithstanding any law relating to or enabling the creation, execution or delivery of any contract or signature by electronic means.

 

13.12 Construction.  This Agreement has been freely and fairly negotiated among the parties.  If an ambiguity or question of intent or interpretation arises, this Agreement will be construed as if drafted jointly by the parties and no presumption or burden of proof will arise favoring or disfavoring any party because of the authorship of any provision of this Agreement.  Any reference to any law will be deemed also to refer to such law as amended and all rules and regulations promulgated thereunder, unless the context requires otherwise.  The words “include,” “includes,” and “including” will be deemed to be followed by “without limitation.”  Pronouns in masculine, feminine, and neuter genders will be construed to include any other gender, and words in the singular form will be construed to include the plural and vice versa, unless the context otherwise requires.  The words “this Agreement,” “herein,” “hereof,” “hereby,” “hereunder,” and words of similar import refer to this Agreement as a whole and not to any particular subdivision unless expressly so limited.  The parties intend that each representation, warranty, and covenant contained herein will have independent significance.  If any party has breached any representation, warranty, or covenant contained herein in any respect, the fact that there exists another representation, warranty or covenant relating to the same subject matter (regardless of the relative levels of specificity) which the party has not breached will not detract from or mitigate the fact that the party is in breach of the first representation, warranty, or covenant.  Time is of the essence in the performance of this Agreement.

 

[Signature page follows]

 

- -

  

  

  

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the Effective Date.

 

MANNATECH, INCORPORATED

 

 

By:                                                      

Name:

Title:

 

 

INDEMNITEE

 

 

Name:

Signature Page to Indemnification AgreementWolverine Exploration Inc.: Exhibit 10.1 - Filed by newsfilecorp.com

(U.S. ACCREDITED PURCHASERS ONLY)

NONE OF THE SECURITIES TO WHICH THIS PRIVATE PLACEMENT
SUBSCRIPTION AGREEMENT (THE "SUBSCRIPTION AGREEMENT") RELATES HAVE BEEN
REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "1933
ACT"), OR ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED, NONE MAY BE
OFFERED OR SOLD IN THE UNITED STATES OR TO U.S. PERSONS (AS DEFINED HEREIN)
EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE
WITH APPLICABLE STATE SECURITIES LAWS.

WOLVERINE EXPLORATION INC.

PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT 

UNITED STATES ACCREDITED INVESTORS

INSTRUCTIONS TO PURCHASER

	1. 	
      This Subscription form is for use by United States
      Accredited Investors.

	 	 
	2. 	
      COMPLETE the information on page 2 of this
      Subscription Agreement.

	 	 
	3. 	
      COMPLETE the Questionnaire attached on page 5 to
      this Subscription Agreement (the "Questionnaire").

	 	 
	4. 	
      All other information must be filled in where
      appropriate.

This is Page 2 of 11 pages of a subscription agreement and
related appendices, schedules and forms. Collectively, these pages together are
referred to as the “Subscription Agreement”.

PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT

TO: WOLVERINE EXPLORATION Inc. (the “Issuer”), of 4055
Maclean Road, Quesnel, BC V2J 6V5.

Subject and pursuant to the terms set out in the Terms on pages
3 to 4 of this Subscription Agreement, the General Provisions on pages 7 to 12
of this Subscription Agreement and the other schedules and appendices attached
which are hereby incorporated by reference, the Purchaser hereby irrevocably
subscribes for, and on Closing will purchase from the Issuer, the following
securities at the following price:

	 
	                                               Shares 
	 
	US$0.05 per Unit for a total purchase price of
      US$___________________ 
	 
	The Purchaser owns, directly or indirectly, the following
      securities of the Issuer: 
	     
	 
	[Check if applicable] The Purchaser is
      [     ]   an affiliate of the Issuer
      or   [      ]   a member of
      the professional group 
	 

The Purchaser directs the Issuer to issue, register and deliver
the certificates representing the Shares as follows:

	 	 	 
	REGISTRATION
      INSTRUCTIONS 	 	DELIVERY INSTRUCTIONS 
	 	 	 
	 	 	 
	Name to appear on
      certificate 	 	Name
      and account reference, if applicable 
	 	 	 
	 	 	 
	Account reference if
      applicable 	 	Contact
      name 
	 	 	 
	 	 	 
	Address 	 	Address
    
	 	 	 
	 	 	 
	  	 	Telephone Number 
	 	 	 

EXECUTED by the Purchaser this _____day of
____________________, 2010. By executing this Subscription Agreement, the
Purchaser certifies that the Purchaser and any beneficial purchaser for whom the
Purchaser is acting is resident in the jurisdiction shown as the “Address of
Purchaser”. 

	 	 	 
	     
                         
                         
         WITNESS: 	 	 
                         
         EXECUTION BY PURCHASER: 
	 	 	 
	  	 	X 
	Signature of Witness
    	 	Signature of individual (if Purchaser is an individual)
    
	 	 	 
	  	 	X 
	Name of Witness 	 	Authorized signatory (if Purchaser is not an individual)
    
	 	 	 
	 
    	 	  
	Address of Witness
    	 	Name of
      Purchaser (please print) 
	 	 	 
	 
    	 	  
	  	 	Name of
      authorized signatory (please print) 
	 	 	 
	Accepted this
      __________________, 2010 	 	  
		 	Address
      of Purchaser (residence) 
	 WOLVERINE EXPLORATION INC. 	 	 
	  Per: 	 	  
	  	 	*Telephone Number 
	 	 	 
	Authorized Signatory
    	 	  
	  	 	*E-mail
      address 
	  	 	  
	 	 	 
	  	 	*Social
      Security/Insurance No./Gov ID No.: 
	 	 	 

*Required from all Purchasers
By signing this acceptance,
the Issuer agrees to be bound by the Terms on pages 3 to 4 of this Subscription
Agreement, the General Provisions on pages 6 to 11 of this Subscription
Agreement and the other schedules and appendices incorporated by reference.
If funds are delivered to the Company’s lawyers, they are authorized to
release the funds to the Issuer without further authorization from the
Purchaser.

	Subscription Agreement (with related appendices,
      schedules and forms) 	Page 3 of 11 

TERMS

	Reference date of this Subscription
      Agreement 	
      ____________________, 2010 (the “Agreement Date”)
      

	 	
       

	 The Offering 
	  	
       

	The Issuer 	
      WOLVERINE EXPLORATION INC. (the “Company or
      Issuer”) 

	  	
       

	Offering 	
      The offering consists of shares of common stock
      (“Shares”). 

	  	
       

	Purchased Securities 	
      The “Securities or Purchased Securities” under
      this Subscription Agreement are the Shares. 

	  	
       

	Total Amount 	
      This offering is not subject to any minimum or maximum
      offering. 

	  	
       

	Issue Price 	
      US$0.05 per Share. 

	  	
       

	Selling Jurisdictions 	
      The Shares may be sold in jurisdictions where they may be
      lawfully sold (the “Selling Jurisdictions”). 

	  	
       

	Exemptions 	
      The offering will be made in accordance with the
      following exemptions: 

      

          (a) the Accredited Investor exemption as defined
      by Regulation D promulgated under the 1933 Act

      

          (b) such other
      exemptions as may be available the securities laws of the Selling
  Jurisdictions. 

	  	
       

	No Registration of Securities 	
      The Securities will be registered with the SEC on a
      commercially reasonable efforts basis and will also be tradable in
      compliance with Rule 144 restricted periods. 

	  	
       

	Resale restrictions and legends 	
      The Purchaser acknowledges that the certificates
      representing the Purchased Securities will bear the following legends:
    

	  	
       

		
      “NONE OF THE SECURITIES TO WHICH THIS PRIVATE PLACEMENT
      SUBSCRIPTION AGREEMENT (THE "SUBSCRIPTION AGREEMENT") RELATES HAVE BEEN
      REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
      "1933 ACT"), OR ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED,
      NONE MAY BE OFFERED OR SOLD IN THE UNITED STATES OR TO U.S. PERSONS (AS
      DEFINED HEREIN) EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION
      NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN EACH
      CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.” 

	  	
       

		
      Purchasers are advised to consult with their own legal
      counsel or advisors to determine the resale restrictions that may be
      applicable to them. 

	  	
       

	Closing Date 	
      The completion of the sale and purchase of the Shares
      will take place in one or more closings, on a date or dates as agreed to
      by the Issuer and the Purchaser (the “Closing Date”). 

	  	
       

	 The Issuer 
	  	
       

	Jurisdiction of organization 	
      The Issuer is incorporated under the laws of the State of
      Nevada. 

	  	
       

	“Securities Legislation Applicable
      to the Issuer” 	
      The “Securities Legislation Applicable to the
      Issuer” is the U.S. Securities Exchange Act of 1934, and the
      Securities Commission having jurisdiction over the Issuer is the United
      States Securities and Exchange Commission. 

End of Terms

	Subscription Agreement (with related appendices,
      schedules and forms) 	Page 4 of 11 

UNITED STATES
ACCREDITED INVESTOR
QUESTIONNAIRE

All capitalized terms herein, unless otherwise defined, have
the meanings ascribed thereto in the Subscription Agreement.

This Questionnaire is for use by each Purchaser who is a US
person (as that term is defined Regulation S of the United States Securities Act
of 1933 (the “1933 Act”)) and has indicated an interest in purchasing Shares of
the Issuer. The purpose of this Questionnaire is to assure the Issuer that each
Purchaser will meet the standards imposed by the 1933 Act and the appropriate
exemptions of applicable state securities laws. The Issuer will rely on the
information contained in this Questionnaire for the purposes of such
determination. The Securities will not be registered under the 1933 Act in
reliance upon the exemption from registration afforded by Section 3(b) and/or
Section 4(2) and Regulation D of the 1933 Act. This Questionnaire is not an
offer of the Securities or any other securities of the Issuer in any state other
than those specifically authorized by the Issuer.

All information contained in this Questionnaire will be treated
as confidential. However, by signing and returning this Questionnaire, each
Purchaser agrees that, if necessary, this Questionnaire may be presented to such
parties as the Issuer deems appropriate to establish the availability, under the
1933 Act or applicable state securities law, of exemption from registration in
connection with the sale of the Securities hereunder.

The Purchaser covenants, represents and warrants to the Issuer
that it satisfies one or more of the categories of “Accredited Investors”, as
defined by Regulation D promulgated under the 1933 Act, as indicated below:
(Please initial in the space provide those categories, if any, of an “Accredited
Investor” which the Purchaser satisfies.)

	_____	Category 1 	
      An organization described in Section 501(c)(3) of the
      United States Internal Revenue Code, a corporation, a Massachusetts or
      similar business trust or partnership, not formed for the specific purpose
      of acquiring the Securities, with total assets in excess of US $5,000,000.
      

	 	  	
       

	_____	Category 2 	
      A natural person whose individual net worth, or joint net
      worth with that person’s spouse, on the date of purchase exceeds US
      $1,000,000. 

	 	  	
       

	_____	Category 3 	
      A natural person who had an individual income in excess
      of US $200,000 in each of the two most recent years or joint income with
      that person’s spouse in excess of US $300,000 in each of those years and
      has a reasonable expectation of reaching the same income level in the
      current year. 

	 	  	
       

	_____	Category 4 	
      A “bank” as defined under Section (3)(a)(2) of the 1933
      Act or savings and loan association or other institution as defined in
      Section 3(a)(5)(A) of the 1933 Act acting in its individual or fiduciary
      capacity; a broker dealer registered pursuant to Section 15 of the
      Securities Exchange Act of 1934 (United States); an insurance
      company as defined in Section 2(13) of the 1933 Act; an investment company
      registered under the Investment Company Act of 1940 (United
      States) or a business development company as defined in Section 2(a)(48)
      of such Act; a Small Business Investment Company licensed by the U.S.
      Small Business Administration under Section 301(c) or (d) of the Small
      Business Investment Act of 1958 (United States); a plan with
      total assets in excess of $5,000,000 established and maintained by a
      state, a political subdivision thereof, or an agency or instrumentality of
      a state or a political subdivision thereof, for the benefit of its
      employees; an employee benefit plan within the meaning of the Employee
      Retirement Income Security Act of 1974 (United States) whose
      investment decisions are made by a plan fiduciary, as defined in Section
      3(21) of such Act, which is either a bank, savings and loan association,
      insurance company or registered investment adviser, or if the employee
      benefit plan has total assets in excess of $5,000,000, or, if a
      self-directed plan, whose investment decisions are made solely by persons
      that are accredited investors. 

	 	  	
       

	_____	Category 5 	
      A private business development company as defined in
      Section 202(a)(22) of the Investment Advisers Act of 1940 (United
      States). 

	Subscription Agreement (with related appendices,
      schedules and forms) 	Page 5 of 11 

	
      _____
	
      Category 6 
	
      A director or executive officer of the Issuer. 

	
       
	
       
	
       

	
      _____
	
      Category 7 
	
      A trust with total assets in excess of $5,000,000, not
      formed for the specific purpose of acquiring the Securities, whose
      purchase is directed by a sophisticated person as described in Rule
      506(b)(2)(ii) under the 1933 Act. 

	
       
	
       
	
       

	
      _____
	
      Category 8 
	
      An entity in which all of the equity owners satisfy the
      requirements of one or more of the foregoing categories.

Note that prospective Purchaser claiming to satisfy one of the
above categories of Accredited Investor may be required to supply the Issuer
with a balance sheet, prior years’ federal income tax returns or other
appropriate documentation to verify and substantiate the Purchaser’s status as
an Accredited Investor.

If the Purchaser is an entity which initialled Category 8 in
reliance upon the Accredited Investor categories above, state the name, address,
total personal income from all sources for the previous calendar year, and the
net worth (exclusive of home, home furnishings and personal automobiles) for
each equity owner of the said entity: 

	 
	 
	
      The Purchaser hereby certifies that the information
      contained in this Questionnaire is complete and accurate and the Purchaser
      will notify the Issuer promptly of any change in any such information. If
      this Questionnaire is being completed on behalf of a corporation,
      partnership, trust or estate, the person executing on behalf of the
      Purchaser represents that it has the authority to execute and deliver this
      Questionnaire on behalf of such entity. 

	
      IN WITNESS WHEREOF, the undersigned has executed this
      Questionnaire as of the ______day of _______________, 2010.

	If a Corporation, Partnership or Other Entity: 	 	If an Individual: 
	  	 	  
	 	 	 
	Print of Type Name of Entity 	 	Signature 
	 	 	 
	 	 	 
	Signature of Authorized Signatory 	 	Print or Type Name 
	 	 	 
	 	 	 
	Type of Entity 	 	  

	Subscription Agreement (with related appendices,
      schedules and forms) 	Page 6 of 11 

GENERAL PROVISIONS

1.            
DEFINITIONS

1.1          
In the Subscription Agreement (including the first (cover) page, the Terms on
pages 3 to 4, these General Provisions and the other schedules, questionnaires
and appendices incorporated by reference), the following words have the
following meanings unless otherwise indicated:

	 	(a) 	
      “1933 Act” means the United States Securities Act
      of 1933, as amended;

	 	 	 
	 	(b) 	
      “Applicable Legislation” means the Securities
      Legislation Applicable to the Issuer (as defined on page 8) and all
      legislation incorporated in the definition of this term in other parts of
      the Subscription Agreement, together with the regulations and rules made
      and promulgated under that legislation and all administrative policy
      statements, blanket orders and rulings, notices and other administrative
      directions issued by the Commissions;

	 	 	 
	 	(c) 	
      “Closing” means the completion of the sale and
      purchase of the Purchased Securities;

	 	 	 
	 	(d) 	
      “Closing Date” has the meaning assigned in the
      Terms;

	 	 	 
	 	(e) 	
      “Closing Year” means the calendar year in which
      the Closing takes place;

	 	 	 
	 	(f) 	
      “Commissions” means the Commissions with
      Jurisdiction over the Issuer (as defined on page 4) and the securities
      commissions incorporated in the definition of this term in other parts of
      the Subscription Agreement;

	 	 	 
	 	(g) 	
      “Final Closing” means the last closing under the
      Private Placement;

	 	 	 
	 	(h) 	
      “General Provisions” means those portions of the
      Subscription Agreement headed “General Provisions” and contained on
      pages 7 to 12;

	 	 	 
	 	(i) 	
      “Private Placement” means the offering of the
      Purchased Securities on the terms and conditions of this Subscription
      Agreement;

	 	 	 
	 	(j) 	
      “Purchased Securities” has the meaning assigned in
      the Terms;

	 	 	 
	 	(k) 	
      “Regulatory Authorities” means the
    Commissions;

	 	 	 
	 	(l) 	
      “Securities” has the meaning assigned in the
      Terms;

	 	 	 
	 	(m) 	
      “Subscription Agreement” means the first (cover)
      page, the Terms on pages 3 to 4, the General Provisions and the other
      schedules and appendices incorporated by reference; and

	 	 	 
	 	(n) 	
      “Terms” means those portions of the Subscription
      Agreement headed “Terms” and contained on page 3.

1.2           In
the Subscription Agreement, the following terms have the meanings defined in
Regulation S under the 1933 Act: “Directed Selling Efforts”, “Foreign
Issuer”, “Substantial U.S. Market Interest”, “U.S. Person” and
“United States”.

1.3          
In the Subscription Agreement, unless otherwise specified, currencies are
indicated in U.S. dollars.

1.4          
In the Subscription Agreement, other words and phrases that are capitalized have
the meanings assigned to them in the body hereof.

	Subscription Agreement (with related appendices,
      schedules and forms) 	Page 7 of 11 

2.            
ACKNOWLEDGEMENTS, REPRESENTATIONS AND WARRANTIES OF PURCHASER

2.1           Acknowledgements
concerning offering

The Purchaser acknowledges that:

	 	(a) 	
      the Securities have not been registered under the 1933
      Act, or under any state securities or "blue sky" laws of any state of the
      United States, and are being offered only in a transaction not involving
      any public offering within the meaning of the 1933 Act, and, unless so
      registered, may not be offered or sold in the United States or to U.S.
      Persons (as defined herein), except pursuant to an effective registration
      statement under the 1933 Act, or pursuant to an exemption from, or in a
      transaction not subject to, the registration requirements of the 1933 Act,
      and in each case only in accordance with applicable state securities
      laws;

	 	 	 
	 	(b) 	
      the Company will refuse to register any transfer of the
      Securities not made in accordance with the provisions of Regulation S,
      pursuant to an effective registration statement under the 1933 Act or
      pursuant to an available exemption from, or in a transaction not subject
      to, the registration requirements of the 1933 Act;

	 	 	 
	 	(c) 	
      the Company has not undertaken, and will have no
      obligation, to register any of the Securities under the 1933
Act;

	 	 	 
	 	(d) 	
      the decision to execute this Subscription Agreement and
      purchase the Purchased Securities agreed to be purchased hereunder has not
      been based upon any oral or written representation as to fact or otherwise
      made by or on behalf of the Company and such decision is based entirely
      upon a review of information (the "Company Information") which has been
      provided by the Company to the Purchaser. If the Company has presented a
      business plan or any other type of corporate profile to the Purchaser, the
      Purchaser acknowledges that the business plan, the corporate profile and
      any projections or predictions contained in any such documents may not be
      achieved or be achievable;

	 	 	 
	 	(e) 	
      the Purchaser and the Purchaser's advisor(s) have had a
      reasonable opportunity to ask questions of and receive answers from the
      Company regarding the Offering, and to obtain additional information, to
      the extent possessed or obtainable without unreasonable effort or expense,
      necessary to verify the accuracy of the information contained in the
      Company Information, or any business plan, corporate profile or any other
      document provided to the Purchaser;

	 	 	 
	 	(f) 	
      the books and records of the Company were available upon
      reasonable notice for inspection, subject to certain confidentiality
      restrictions, by the Purchaser during reasonable business hours at its
      principal place of business and that all documents, records and books
      pertaining to this Offering have been made available for inspection by the
      Purchaser, the Purchaser's attorney and/or advisor(s);

	 	 	 
	 	(g) 	
      by execution hereof the Purchaser has waived the need for
      the Company to communicate its acceptance of the purchase of the Purchased
      Securities pursuant to this Subscription Agreement;

	 	 	 
	 	(h) 	
      the Company is entitled to rely on the representations
      and warranties and the statements and answers of the Purchaser contained
      in this Subscription Agreement and in the Questionnaire, and the Purchaser
      will hold harmless the Company from any loss or damage it may suffer as a
      result of the Purchaser's failure to correctly complete this Subscription
      Agreement or the Questionnaire;

	 	 	 
	 	(i) 	
      the Purchaser will indemnify and hold harmless the
      Company and, where applicable, its respective directors, officers,
      employees, agents, advisors and shareholders from and against any and all
      loss, liability, claim, damage and expense whatsoever (including, but not
      limited to, any and all fees, costs and expenses whatsoever reasonably
      incurred in investigating, preparing or defending against any claim,
      lawsuit, administrative proceeding or investigation whether commenced
      or threatened) arising out of or based upon any
      representation or warranty of the Purchaser contained herein, the
      Questionnaire or in any other document furnished by the Purchaser to the
      Company in connection herewith, being untrue in any material respect or
      any breach or failure by the Purchaser to comply with any covenant or
      agreement made by the Purchaser to the Company in connection
  therewith;

	Subscription Agreement (with related appendices,
      schedules and forms) 	Page 8 of 11 

	 	(j) 	
      the issuance and sale of the Purchased Securities to the
      Purchaser will not be completed if it would be unlawful or if, in the
      discretion of the Company acting reasonably, it is not in the best
      interests of the Company;

	 	 	 
	 	(k) 	
      the Purchaser has been advised to consult its own legal,
      tax and other advisors with respect to the merits and risks of an
      investment in the Purchased Securities and with respect to applicable
      resale restrictions and it is solely responsible (and the Company is in
      any way responsible) for compliance with applicable resale
      restrictions;

	 	 	 
	 	(l) 	
      the Securities are not listed on any stock exchange or
      automated dealer quotation system and no representation has been made to
      the Purchaser that any of the Securities will become listed on any stock
      exchange or automated dealer quotation system;

	 	 	 
	 	(m) 	
      neither the SEC nor any other securities commission or
      similar regulatory authority has reviewed or passed on the merits of the
      Securities ;

	 	 	 
	 	(n) 	
      no documents in connection with this Offering have been
      reviewed by the SEC or any state securities administrators;

	 	 	 
	 	(o) 	
      there is no government or other insurance covering any of
      the Securities; and

	 	 	 
	 	(p) 	
      this Subscription Agreement is not enforceable by the
      Purchaser unless it has been accepted by the Company, and the Purchaser
      acknowledges and agrees that the Company reserves the right to reject any
      Subscription for any reason.

2.2           Representations
by the purchaser

The Purchaser represents and warrants to the Issuer that, as at
the Agreement Date and at the Closing:

	 	(q) 	
      the Purchaser is resident in the United States;

	 	 	 
	 	(r) 	
      the Purchaser has received and carefully read this
      Subscription Agreement;

	 	 	 
	 	(s) 	
      the Purchaser has the legal capacity and competence to
      enter into and execute this Subscription Agreement and to take all actions
      required pursuant hereto and, if the Purchaser is a corporation, it is
      duly incorporated and validly subsisting under the laws of its
      jurisdiction of incorporation and all necessary approvals by its
      directors, shareholders and others have been obtained to authorize
      execution and performance of this Subscription Agreement on behalf of the
      Purchaser;

	 	 	 
	 	(t) 	
      the Purchaser (i) has adequate net worth and means of
      providing for its current financial needs and possible personal
      contingencies, (ii) has no need for liquidity in this investment, and
      (iii) is able to bear the economic risks of an investment in the Purchased
      Securities for an indefinite period of time, and can afford the complete
      loss of such investment;

	 	 	 
	 	(u) 	
      the Purchaser is aware that an investment in the Company
      is speculative and involves certain risks, including the possible loss of
      the investment;

	 	 	 
	 	(v) 	
      the entering into of this Subscription Agreement and the
      transactions contemplated hereby do not result in the violation of any of
      the terms and provisions of any law applicable to, or, if
    applicable, the constating documents of, the Purchaser, or of any
      agreement, written or oral, to which the Purchaser may be a party or by
  which the Purchaser is or may be bound;

	Subscription Agreement (with related appendices,
      schedules and forms) 	Page 9 of 11 

	 	(w) 	
      the Purchaser has duly executed and delivered this
      Subscription Agreement and it constitutes a valid and binding agreement of
      the Purchaser enforceable against the Purchaser;

	 	 	 
	 	(x) 	
      the Purchaser has the requisite knowledge and experience
      in financial and business matters as to be capable of evaluating the
      merits and risks of the investment in the Purchased Securities and the
      Company, and the Purchaser is providing evidence of such knowledge and
      experience in these matters through the information requested in the
      Questionnaire;

	 	 	 
	 	(y) 	
      the Purchaser understands and agrees that the Company and
      others will rely upon the truth and accuracy of the acknowledgements,
      representations and agreements contained in this Subscription Agreement,
      and agrees that if any of such acknowledgements, representations and
      agreements are no longer accurate or have been breached, the Purchaser
      shall promptly notify the Company;

	 	 	 
	 	(z) 	
      all information contained in the Questionnaire is
      complete and accurate and may be relied upon by the Company, and the
      Purchaser will notify the Company immediately of any material change in
      any such information occurring prior to the closing of the purchase of the
      Securities ;

	 	 	 
	 	(aa) 	
      the Purchaser is purchasing the Purchased Securities for
      its own account for investment purposes only and not for the account of
      any other person and not for distribution, assignment or resale to others,
      and no other person has a direct or indirect beneficial interest is such
      Purchased Securities, and the Purchaser has not subdivided his interest in
      the Purchased Securities with any other person;

	 	 	 
	 	(bb) 	
      the Purchaser is not an underwriter of, or dealer in, the
      common shares of the Company, nor is the Purchaser participating, pursuant
      to a contractual agreement or otherwise, in the distribution of the
      Securities ;

	 	 	 
	 	(cc) 	
      the Purchaser has made an independent examination and
      investigation of an investment in the Purchased Securities and the Company
      and has depended on the advice of its legal and financial advisors and
      agrees that the Company will not be responsible in anyway whatsoever for
      the Purchaser's decision to invest in the Purchased Securities and the
      Company;

	 	 	 
	 	(dd) 	
      if the Purchaser is acquiring the Purchased Securities as
      a fiduciary or agent for one or more investor accounts, the investor
      accounts for which the Purchaser acts as a fiduciary or agent satisfy the
      definition of an "Accredited Investor", as the term is defined under
      Regulation D of the 1933 Act;

	 	 	 
	 	(ee) 	
      if the Purchaser is acquiring the Purchased Securities as
      a fiduciary or agent for one or more investor accounts, the Purchaser has
      sole investment discretion with respect to each such account, and the
      Purchaser has full power to make the foregoing acknowledgements,
      representations and agreements on behalf of such account;

	 	 	 
	 	(ff) 	
      the Purchaser is not aware of any advertisement of any of
      the Purchased Securities and is not acquiring the Purchased Securities as
      a result of any form of general solicitation or general advertising
      including advertisements, articles, notices or other communications
      published in any newspaper, magazine or similar media or broadcast over
      radio or television, or any seminar or meeting whose attendees have been
      invited by general solicitation or general advertising; and

	 	 	 
	 	(gg) 	
      no person has made to the Purchaser any written or oral
      representations:

	 	 	 
	 		
      (i)      that any person will
      resell or repurchase any of the Securities ;

	Subscription Agreement (with related appendices,
      schedules and forms) 	Page 10 of 11 

	 	(ii) 	
      that any person will refund the purchase price of any of
      the Securities ;

	 	 	 
	 	(iii) 	
      as to the future price or value of any of the Securities;
      or

	 	 	 
	 	(iv) 	
      that any of the Securities will be listed and posted for
      trading on any stock exchange or automated dealer quotation system or that
      application has been made to list and post any of the Securities of the
      Company on any stock exchange or automated dealer quotation
  system.

2.3          
Reliance, indemnity and notification of changes

The representations and warranties in the Subscription
Agreement (including the first (cover) page, the Terms, the General Provisions
and the other schedules and appendices incorporated by reference) are made by
the Purchaser with the intent that they be relied upon by the Issuer in
determining its suitability as a purchaser of Purchased Securities, and the
Purchaser hereby agrees to indemnify the Issuer against all losses, claims,
costs, expenses and damages or liabilities which any of them may suffer or incur
as a result of reliance thereon. The Purchaser undertakes to notify the Issuer
immediately of any change in any representation, warranty or other information
relating to the Purchaser set forth in the Subscription Agreement (including the
first (cover) page, the Terms, the General Provisions and the other schedules
and appendices incorporated by reference) which takes place prior to the
Closing.

2.4           Survival
of representations and warranties

The representations and warranties contained in this Section
will survive the Closing.

3.           
 ISSUER’S ACCEPTANCE

The Subscription Agreement, when executed by the Purchaser, and
delivered to the Issuer, will constitute a subscription for Purchased Securities
which will not be binding on the Issuer until accepted by the Issuer by
executing the Subscription Agreement in the space provided on the face page(s)
of the Agreement and, notwithstanding the Agreement Date, if the Issuer accepts
the subscription by the Purchaser, the Subscription Agreement will be entered
into on the date of such execution by the Issuer.

4.            
CLOSING

4.1           On
or before the end of the fifth business day before the Closing Date, the
Purchaser will deliver to the Issuer the Subscription Agreement and all
applicable schedules and required forms, duly executed, and payment in full for
the total price of the Purchased Securities to be purchased by the
Purchaser.

4.2           At
Closing, the Issuer will deliver to the Purchaser the certificates representing
the Purchased Securities purchased by the Purchaser registered in the name of
the Purchaser or its nominee, or as directed by the Purchaser.

5.            
MISCELLANEOUS

5.1          
The Purchaser agrees to sell, assign or transfer the Securities only in
accordance with the requirements of applicable securities laws and any legends
placed on the Securities as contemplated by the Subscription Agreement.

5.2           The
Purchaser hereby authorizes the Issuer to correct any minor errors in, or
complete any minor information missing from any part of the Subscription
Agreement and any other schedules, forms, certificates or documents executed by
the Purchaser and delivered to the Issuer in connection with the Private
Placement.

5.3           The
Issuer may rely on delivery by fax machine of an executed copy of this
subscription, and acceptance by the Issuer of such faxed copy will be equally
effective to create a valid and binding agreement between the Purchaser and the
Issuer in accordance with the terms of the Subscription Agreement.

	Subscription Agreement (with related appendices,
      schedules and forms) 	Page 11 of 11 

5.4           Without
limitation, this subscription and the transactions contemplated by this
Subscription Agreement are conditional upon and subject to the Issuer’s having
obtained such regulatory approval of this subscription and the transactions
contemplated by this Subscription Agreement as the Issuer considers
necessary.

5.5           This
Subscription Agreement is not assignable or transferable by the parties hereto
without the express written consent of the other party to this Subscription
Agreement.

5.6           Time
is of the essence of this Subscription Agreement.

5.7          
Except as expressly provided in this Subscription Agreement and in the
agreements, instruments and other documents contemplated or provided for in this
Subscription Agreement, this Subscription Agreement contains the entire
agreement between the parties with respect to the Securities and there are no
other terms, conditions, representations or warranties whether expressed,
implied, oral or written, by statute, by common law, by the Issuer, or by anyone
else.

5.8          
The parties to this Subscription Agreement may amend this Subscription Agreement
only in writing.

5.9           This
Subscription Agreement enures to the benefit of and is binding upon the parties
to this Subscription Agreement and their successors and permitted assigns.

5.10      
 A party to this Subscription Agreement will give all notices to
or other written communications with the other party to this Subscription
Agreement concerning this Subscription Agreement by hand or by registered mail
addressed to the address given on page 1.

5.11       
This Subscription Agreement is to be read with all changes in gender or
number as required by the context.

5.12       
This Subscription Agreement will be governed by and construed in
accordance with the internal laws of Nevada (without reference to its rules
governing the choice or conflict of laws), and the parties hereto irrevocably
attorn and submit to the exclusive jurisdiction of the courts of Nevada with
respect to any dispute related to this Subscription Agreement.

End of General Provisions

End of Subscription Agreement

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