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Unassociated Document

     

    REGISTRATION
      RIGHTS AGREEMENT

     

    THIS
      REGISTRATION RIGHTS AGREEMENT (this “Agreement”)
      is
      made and entered into as of October 17, 2005 by and between Apollo Gold
      Corporation, a Yukon Territory corporation (the “Company”),
      as
      evidenced by the signatures of the Company and Jipangu Inc., a Japanese
      corporation (the “Subscriber”)
      pursuant to the Subscription Agreement dated as of October 17, 2005 (the
“Subscription
      Agreement”)
      for up
      to 11,650,000 Common Shares (the “Shares”)
      of the
      Company and up to 2,000,000 common share purchase warrants (the “Warrants”)
      of the
      Company, each Warrant entitling the holder to acquire one common share
      (“Warrant
      Share”)
      of the
      Company as set forth in the Subscription Agreement. In order to induce the
      Subscriber under the Subscription Agreement to enter into the Subscription
      Agreement, the Company has agreed to provide the registration rights set forth
      in this Agreement. 

     

    The
      Company agrees with the Subscriber, (i) for its benefit as Subscriber
      and
      (ii) for the benefit of the beneficial owners (including the Subscriber)
      from time to time of the Shares, the Warrants and the Warrant Shares, and (iii)
      for the benefit of the beneficial owners from time to time of the Registrable
      Securities (as defined herein) issuable pursuant to the Subscription Agreement
      (each of the foregoing a “Holder”
      and
      together the “Holders”),
      as
      follows:

     

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

     

    “Additional
      Amount”
      means
      any security issued with respect thereto upon any stock dividend, split, merger
      or similar event, for each Registrable Security owned by the
      Holder.

     

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

     

    “Common
      Shares”
      means
      the Company’s common shares, no par value.

     

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

     

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

     

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

     

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

     

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

     

    
      
        
        

      

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

     

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

     

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

     

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

     

    “Issue
      Date”
      means
      the Closing Date, as that term is defined in the Subscription
      Agreement.

     

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

     

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

     

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

     

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

     

    “Registrable
      Securities”
      means
      the Shares, the Warrant Shares that have been issued or are issuable upon
      exercise of the Warrants, and any security issued with respect thereto upon
      any
      stock dividend, split, merger or similar event until, in the case of any such
      security, the earlier of (i) the date on which all of the Registrable Securities
      have been sold pursuant to Rule 144 under the Securities Act or a shelf
      registration statement and no additional Warrant Shares are issuable upon
      exercise of the Warrants, or (ii) the date on which each Holder is entitled
      to
      sell all of its Registrable Securities pursuant to Rule 144(k) and no additional
      Warrant Shares are issuable upon exercise of the Warrants.

     

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

     

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

     

    
      
        
        

      

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

     

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

     

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

     

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

     

    “Subscriber”
      means
      the Subscriber to the Subscription Agreement.

     

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

     

    “Warrant
      Shares”
      has the
      meaning specified in the first paragraph of this Agreeement.

     

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

     

    SECTION
      2.   Resale
      Registration. 

     

    (a)  The
      Company shall prepare and file or cause to be prepared and filed with the SEC
      no
      later than December 31, 2005 (the “Filing
      Deadline Date”)
      a
      Registration Statement (the “Initial
      Resale Registration Statement”)
      registering the resale from time to time by Holders of all of the Registrable
      Securities (a “Resale
      Registration Statement”).
      The
      Initial Resale Registration Statement shall be on Form S-3 or another
      appropriate form permitting registration of such Registrable Securities for
      resale by such Holders in accordance with the methods of distribution set forth
      in the Initial Resale Registration Statement. The Company shall use its
      commercially reasonable efforts to cause the Initial Resale Registration
      Statement to be declared effective under the Securities Act no later than the
      date (the “Effectiveness
      Deadline Date”)
      that
      is ninety (90) days (or, in the case of a full review by the SEC, one hundred
      and twenty (120) days) after the Issue Date, and to keep, subject to Section
      3(d)(A) hereof, the Initial Resale Registration Statement (or any Subsequent
      Resale Registration Statement) continuously effective under the Securities
      Act
      until the expiration of the Effectiveness Period. Each Holder that became a
      Notice Holder on or prior to the date ten (10) Business Days prior to the time
      that the Initial Resale Registration Statement became effective shall be named
      as a selling security holder in the Initial Resale Registration Statement and
      the related Prospectus in such a manner as to permit such Holder to deliver
      such
      Prospectus to purchasers of Registrable Securities in accordance with applicable
      law (other than laws not generally applicable to all such Holders).
      Notwithstanding the foregoing, no Holder shall be entitled to have the
      Registrable Securities held by it covered by such Resale Registration Statement
      unless such Holder has provided a Notice and Questionnaire in accordance with
      and in compliance with Section 4. The Company may permit any of its
      security holders to include any of the Company’s securities in the Initial
      Resale Registration Statement or any Subsequent Resale Registration
      Statement.

     

    
      
        
        

      

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

     

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

     

    (d)
      Each
      Holder of Registrable Securities agrees that if such Holder wishes to sell
      Registrable Securities pursuant to a Resale Registration Statement and related
      Prospectus, it will do so only in accordance with this Section 2(d),
      Section 3(d) and Section 4. Each Holder of Registrable Securities
      wishing to sell Registrable Securities pursuant to the Initial or any Subsequent
      Resale Registration Statement and related Prospectus agrees to deliver a Notice
      and Questionnaire to the Company at least five (5) business days prior to any
      intended distribution of Registrable Securities under the Resale Registration
      Statement. From and after the date the Initial Resale Registration Statement
      is
      declared effective, the Company shall, as promptly as is reasonably practicable
      after the date a fully completed and legible Notice and Questionnaire is
      received by the Company, (i) if required by applicable law, file with
      the
      SEC a post-effective amendment to the Resale Registration Statement or prepare
      and, if required by applicable law, file a supplement to the related Prospectus
      or a supplement or amendment to any document incorporated therein by reference
      or file any other document required by the SEC so that the Holder delivering
      such Notice and Questionnaire is named as a selling security holder in the
      Resale Registration Statement and the related Prospectus in such a manner as
      to
      permit such Holder to deliver such Prospectus to purchasers of the Registrable
      Securities in accordance with applicable law (other than laws not generally
      applicable to all Holders of Registrable Securities wishing to sell Registrable
      Securities pursuant to the Resale Registration Statement and related Prospectus)
      and using the manner of sale specified in the Notice and Questionnaire, and,
      if
      the Company shall file a post-effective amendment to the Resale Registration
      Statement, use commercially reasonable efforts to cause such post-effective
      amendment to be declared effective under the Securities Act as promptly as
      is
      reasonably practicable; (ii) provide such Holder copies of any documents
      filed pursuant to Section 2(d)(i); and (iii) notify such Holder
      as
      promptly as is reasonably practicable after the effectiveness under the
      Securities Act of any post-effective amendment filed pursuant to
      Section 2(d)(i); provided,
      that if
      such Notice and Questionnaire is delivered during a Deferral Period, the Company
      shall so inform the Holder delivering such Notice and Questionnaire and shall
      take the actions set forth in clauses (i), (ii) and (iii) above
      upon
      expiration of the Deferral Period in accordance with Section 3(d),
provided,
      further,
      that if
      under applicable law the Company has more than one option as to the type or
      manner of making any such filing, the Company will make the required filing
      or
      filings in the manner or of a type that is reasonably expected to result in
      the
      earliest availability of the Prospectus for effecting resales of Registrable
      Securities. Notwithstanding anything contained herein to the contrary, the
      Company shall be under no obligation to name any Holder that is not a Notice
      Holder as a selling security holder in any Registration Statement or related
      Prospectus; provided,
      however,
      that
      any Holder that becomes a Notice Holder pursuant to the provisions of this
      Section 2(d) of this Agreement (whether or not such Holder was a Notice
      Holder at the time the Registration Statement was initially declared effective)
      shall be named as a selling security holder in the Registration Statement or
      related Prospectus subject to and in accordance with the requirements of this
      Section 2(d).

     

    
      
        
        

      

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

     

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

     

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

     

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

     

    
      
        
        

      

      
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    (d)  Upon
      (A) the issuance by the SEC of a stop order suspending the effectiveness
      of
      the Resale Registration Statement or the initiation of proceedings with respect
      to the Resale Registration Statement under Section 8(d) or 8(e) of the
      Securities Act, (B) the occurrence of any event or the existence of
      any
      fact (a “Material
      Event”)
      as a
      result of which any Registration Statement shall contain any untrue statement
      of
      a material fact or omit to state any material fact required to be stated therein
      or necessary to make the statements therein not misleading, or any Prospectus
      shall contain any untrue statement of a material fact or omit to state any
      material fact necessary to make the statements therein, in light of the
      circumstances under which they were made, not misleading (including, in any
      such
      case, as a result of the non-availability of financial statements), or
      (C) the occurrence or existence of any development, event, fact, situation
      or circumstance relating to the Company that, in the discretion of the Company,
      makes it appropriate to suspend the availability of the Resale Registration
      Statement and the related Prospectus, (i) in the case of clause (B)
      above, subject to the next sentence, as promptly as practicable prepare and
      file
      a post-effective amendment to such Registration Statement or a supplement to
      the
      related Prospectus or any document incorporated therein by reference or file
      any
      other required document that would be incorporated by reference into such
      Registration Statement and Prospectus so that such Registration Statement does
      not contain any untrue statement of a material fact or omit to state any
      material fact required to be stated therein or necessary to make the statements
      therein not misleading, and such Prospectus does not contain any untrue
      statement of a material fact or omit to state any material fact necessary to
      make the statements therein, in the light of the circumstances under which
      they
      were made, not misleading, as thereafter delivered to the purchasers of the
      Registrable Securities being sold thereunder, and, in the case of a
      post-effective amendment to a Registration Statement, subject to the next
      sentence, use commercially reasonable efforts to cause it to be declared
      effective as promptly as is reasonably practicable, and (ii) give notice
      (via facsimile, telephone or electronic mail followed by a written notice by
      first-class mail) to the Notice Holders that the availability of the Resale
      Registration Statement is suspended (a “Deferral
      Notice”)
      and,
      upon receipt of any Deferral Notice, each Notice Holder agrees not to sell
      any
      Registrable Securities pursuant to the Registration Statement until such Notice
      Holder’s receipt of copies of the supplemented or amended Prospectus provided
      for in clause (i) above, or until it is advised in writing by the Company
      that the Prospectus may be used, and has received copies of any additional
      or
      supplemental filings that are incorporated or deemed incorporated by reference
      in such Prospectus. The Company will use commercially reasonable efforts to
      ensure that the use of the Prospectus may be resumed (x) in the case
      of
      clause (A) above, as promptly as is practicable, (y) in the case
      of
      clause (B) above, as soon as, in the sole reasonable judgment of the
      Company, public disclosure of such Material Event would not be prejudicial
      to or
      contrary to the interests of the Company or, if necessary to avoid unreasonable
      burden or expense, as soon as reasonably practicable thereafter and (z) in
      the case of clause (C) above, as soon as, in the reasonable discretion
      of
      the Company, such suspension is no longer appropriate. The period during which
      the availability of the Registration Statement and any Prospectus is suspended
      (the “Deferral
      Period”)
      is not
      to exceed (i) 20 consecutive days at any one time; (ii) 30 days in the aggregate
      in any three-month period; or (iii) 60 days in the aggregate during any 12-month
      period, or as otherwise required by applicable regulatory authority; provided
      that, the number of days the Company is required to keep the Registration
      Statement effective shall be extended by the number of days equal to the
      aggregate Deferral Period(s). The first day of any Deferral Period must be
      at
      least two (2) trading days after the last day of any prior Deferral
      Period.

     

    
      
        
        

      

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

     

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

     

    (g)
      Upon
      (i) the filing of the Initial Resale Registration Statement and
      (ii) the effectiveness of the Initial Resale Registration Statement,
      announce the same, in each case by press release or any other means of
      dissemination reasonably expected to make such information known
      publicly.

     

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

     

    SECTION
      4.   Holder’s
      Obligations.
      Each
      Holder agrees, by acquisition of the Registrable Securities, that no Holder
      of
      Registrable Securities shall be entitled to sell any of such Registrable
      Securities pursuant to a Registration Statement or to receive a Prospectus
      relating thereto, unless such Holder has furnished the Company with a Notice
      and
      Questionnaire as required pursuant to this Section 4 (including the information
      required to be included in such Notice and Questionnaire) and the information
      set forth in the next sentence. Each Holder of Registrable Securities wishing
      to
      sell Registrable Securities pursuant to the Initial or any Subsequent Resale
      Registration Statement and related Prospectus agrees to deliver a Notice and
      Questionnaire to the Company at least five (5) business days prior to the filing
      of the Initial Resale Registration Statement or Subsequent Resale Registration
      Statement. Each Notice Holder agrees promptly to furnish to the Company in
      writing all information required to be disclosed in order to make the
      information previously furnished to the Company by such Notice Holder not
      misleading, any other information regarding such Notice Holder and the
      distribution of such Registrable Securities as may be required to be disclosed
      in the Registration Statement under applicable law or pursuant to SEC comments
      and any information otherwise required by the Company to comply with applicable
      law or regulations. Each Holder further agrees, following termination of the
      Effectiveness Period, to notify the Company, within twenty (20) Business Days
      of
      a request, of the amount of Registrable Securities sold pursuant to the
      Registration Statement and, in the absence of a response, the Company may assume
      that all of the Holder’s Registrable Securities were so sold.

     

    
      
        
        

      

      
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    SECTION
      5.   Registration
      Expenses.
      The
      Company shall bear all fees and expenses incurred in connection with the
      performance by the Company of its obligations under Sections 2 and 3
      of
      this Agreement whether or not any of the Registration Statements are declared
      effective. Such fees and expenses shall include, without limitation,
      (i) all registration and filing fees (including, without limitation,
      fees
      and expenses (x) with respect to filings required to be made with the
      American Stock Exchange and (y) of compliance with federal and state
      securities or Blue Sky laws to the extent such filings or compliance are
      required pursuant to this Agreement (including, without limitation, reasonable
      fees and disbursements of the counsel specified in the next sentence in
      connection with Blue Sky qualifications of the Registrable Securities under
      the
      laws of such jurisdictions as the Notice Holders of a majority of the
      Registrable Securities being sold pursuant to a Registration Statement may
      designate)), (ii) printing expenses, (iii) duplication expenses
      relating to copies of any Registration Statement or Prospectus delivered to
      any
      Holders hereunder, and (iv) fees and disbursements of counsel for the
      Company in connection with the Resale Registration Statement. In addition,
      the
      Company shall pay its internal expenses (including, without limitation, all
      salaries and expenses of officers and employees performing legal or accounting
      duties), and its expenses for any annual audit, the fees and expenses incurred
      in connection with the listing of the Registrable Securities on any securities
      exchange on which the same securities of the Company are then listed and the
      fees and expenses of any person, including special experts, retained by the
      Company.

     

    SECTION
      6.   Registrant
      and Information Requirements.
      The
      Company represents that Form S-3 under the Securities Act is, on the date of
      this Agreement, available for the registration of the Registrable Securities
      by
      the Company for sale by the Holders. The Company covenants that (a) during
      the Effectiveness Period, it will (i) make and keep public information
      available, as those terms are understood and defined in Rule 144, (ii) take
      such action as is necessary to enable the Holders to utilize Form S 3 for the
      sale of their Registrable Securities, (iii) file with the SEC in a timely
      manner all reports and other documents required of the Company under the
      Securities Act and the Exchange Act, and (b) so long as any Holder owns
      any
      Registrable Securities, it will furnish to such Holder, forthwith upon request
      (i) a written statement by the Company that it has complied with the
      reporting requirements of Rule 144, the Securities Act and the Exchange Act,
      (ii) a copy of the most recent annual or quarterly report of the Company
      and such other reports and documents so filed by the Company, and
      (iii) such other information as may be reasonably requested in availing
      any
      Holder of any rule or regulation of the SEC that permits the selling of any
      such
      securities without registration or Form S-3.

     

    
      
        
        

      

      
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    SECTION
      7.   Indemnification
      and Contribution.    

     

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

     

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

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

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

     

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

     

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

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

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

     

    Notwithstanding
      the provisions of this Section 7, neither the Holder of any Registrable
      Securities nor the Subscriber shall be required to indemnify or contribute
      any
      amount in excess of the amount by which the total price at which the Registrable
      Securities sold by such Holder of Registrable Securities or by the Subscriber,
      as the case may be, and distributed to the public were offered to the public
      exceeds the amount of any damages that such Holder of Registrable Securities
      or
      the Subscriber has otherwise been required to pay by reason of such untrue
      or
      alleged untrue statement or omission or alleged omission.

     

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

     

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

     

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

     

    SECTION
      8.   Miscellaneous

     

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

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    (b)  Amendments
      and Waivers.
      The
      provisions of this Agreement, including the provisions of this sentence, may
      not
      be amended, modified or supplemented, and waivers or consents to departures
      from
      the provisions hereof may not be given, unless the Company has obtained the
      written consent of Holders of a majority of the then outstanding Registrable
      Securities. Notwithstanding the foregoing, a waiver or consent to depart from
      the provisions hereof with respect to a matter that relates exclusively to
      the
      rights of Holders of Registrable Securities whose securities are being sold
      pursuant to a Registration Statement and that does not directly or indirectly
      affect the rights of other Holders of Registrable Securities may be given by
      Holders of at least a majority of the Registrable Securities being sold by
      such
      Holders pursuant to such Registration Statement; provided,
      that
      the provisions of this sentence may not be amended, modified, or supplemented
      except in accordance with the provisions of the immediately preceding sentence.
      Each Holder of Registrable Securities outstanding at the time of any such
      amendment, modification, supplement, waiver or consent or thereafter shall
      be
      bound by any such amendment, modification, supplement, waiver or consent
      effected pursuant to this Section 8(b), whether or not any notice, writing
      or marking indicating such amendment, modification, supplement, waiver or
      consent appears on the Registrable Securities or is delivered to such
      Holder.

     

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

     

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

     

    if
      to the
      Company, to:

     

    Apollo
      Gold Corporation

    5655
      S.
      Yosemite Street, Suite 200

    Greenwood
      Village, Colorado, U.S.A., 80111- 3220

    Facsimile:
      (720) 482-0957

    Attention:
      Chief Financial Officer    

     

    with
      a
      copy to:

     

    Davis
      Graham & Stubbs LLP

    1550
      Seventeenth Street, Suite 500

    Denver,
      Colorado 80202

    Attention:
      Deborah J. Friedman, Esq.

    Facsimile
      No. (303) 893-1379

    

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

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

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

     

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

     

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

     

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

     

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

     

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

     

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

     

    (k)  Termination.
      This
      Agreement and the obligations of the parties hereunder shall terminate upon
      the
      expiration of the Effectiveness Period.

     

    

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

        
        

      

    

    

    IN
      WITNESS WHEREOF
      the
      parties hereto have duly executed this Registration Rights Agreement as of
      the
      day and year set forth above.

    

      
        	 	 	 
	 	JIPANGU,
                INC.
	 	
                 

                 

              	 
	 	By:  	/s/ Tamisuke
                Matsufuji
	 	
                

              
	 	
                Name:    
                  Tamisuke Matsufuji

                Office:    
                  President and CEO

              

      

    

    
       

      
        	APOLLO
                GOLD CORPORATION	 	 	 
	
                 

              	 	 	 
	 	 	 	 
	By:  
                /s/ R. David Russell	 	 	 
	
                
                  

                

              	 	 	
              
	Name:    
                R. David Russell
Office:    President and CEO	 	 	 

      

      
 

      
        
          
          

        

        
          14Unassociated Document

    

       

      STOCK
        PURCHASE AGREEMENT

       

      among

       

      Jipangu
        Inc.,

       

      Jipangu
        International Inc.,

       

      Apollo
        Gold, Inc.

       

      and

       

      Apollo
        Gold Corporation

       

      made
        as of

       

      October
        17, 2005

       

      

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          
          

        

      

      Table
        of Contents

       

      
        
          	 	 
	
                  I.
                    Definitions

                	
                  1

                
	
                  II.
                    Purchase of Shares and Closing

                	
                  9

                
	
                  2.1

                	
                  Purchase
                    and Sale

                	
                  9

                
	
                  2.2

                	
                  Purchase
                    Price

                	
                  9

                
	
                  2.3

                	
                  Unaudited
                    Closing Date Balance Sheets

                	
                  10

                
	
                  2.4

                	
                  The
                    Closing

                	
                  10

                
	
                  2.5

                	
                  Further
                    Assurances

                	
                  13

                
	
                  III.
                    Representations and Warranties of Seller and Guarantor

                	
                  13

                
	
                  3.1

                	
                  Title
                    to Shares

                	
                  13

                
	
                  3.2

                	
                  Incorporation;
                    Power and Authority

                	
                  13

                
	
                  3.3

                	
                  Valid
                    and Binding Agreement

                	
                  13

                
	
                  3.4

                	
                  No
                    Breach; Consents

                	
                  13

                
	
                  3.5

                	
                  Brokerage

                	
                  14

                
	
                  3.6

                	
                  Public
                    Filings

                	
                  14

                
	
                  IV.
                    Representations and Warranties Regarding the Companies

                	
                  14

                
	
                  4.1

                	
                  Incorporation;
                    Power and Authority

                	
                  14

                
	
                  4.2

                	
                  No
                    Breach; Consents

                	
                  15

                
	
                  4.3

                	
                  Capitalization

                	
                  15

                
	
                  4.4

                	
                  Subsidiaries

                	
                  16

                
	
                  4.5

                	
                  Financial
                    Statements

                	
                  16

                
	
                  4.6

                	
                  Absence
                    of Undisclosed Liabilities

                	
                  17

                
	
                  4.7

                	
                  Books
                    and Records

                	
                  17

                
	
                  4.8

                	
                  Absence
                    of Certain Developments

                	
                  18

                
	
                  4.9

                	
                  Property

                	
                  20

                
	
                  4.10

                	
                  Accounts
                    Receivable

                	
                  22

                
	
                  4.11

                	
                  Tax
                    Matters.

                	
                  22

                
	
                  4.12

                	
                  Intellectual
                    Property Rights

                	
                  25

                
	
                  4.13

                	
                  Material
                    Contracts

                	
                  25

                
	
                  4.14

                	
                  Litigation

                	
                  27

                
	
                  4.15

                	
                  Insurance

                	
                  27

                
	
                  4.16

                	
                  Compliance
                    with Laws; Governmental Authorizations

                	
                  27

                
	
                  4.17

                	
                  Environmental
                    Matters

                	
                  28

                
	
                  4.18

                	
                  Employees

                	
                  30

                
	
                  4.19

                	
                  Employee
                    Benefits

                	
                  32

                
	
                  4.20

                	
                  Suppliers

                	
                  34

                
	
                  4.21

                	
                  Affiliate
                    Transactions

                	
                  34

                
	
                  4.22

                	
                  Brokerage

                	
                  35

                
	
                  4.23

                	
                  Availability
                    of Documents

                	
                  35

                
	
                  4.24

                	
                  Disclosure

                	
                  35

                
	
                  4.25

                	
                  Disclaimer
                    of Certain Representations or Warranties

                	
                  35

                

        

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

         

        
          
            	
                    V.
                      Representations and Warranties of Buyer Parties

                  	
                    35

                  
	
                    5.1

                  	
                    Incorporation;
                      Power and Authority

                  	
                    35

                  
	
                    5.2

                  	
                    Valid
                      and Binding Agreement

                  	
                    35

                  
	
                    5.3

                  	
                    No
                      Breach; Consents

                  	
                    36

                  
	
                    5.4

                  	
                    No
                      Other Representations; Suitability

                  	
                    36

                  
	
                    5.5

                  	
                    Brokerage

                  	
                    36

                  
	
                    5.6

                  	
                    Investment
                      Intent

                  	
                    36

                  
	
                    5.7

                  	
                    Financial
                      Condition

                  	
                    36

                  
	
                    5.8

                  	
                    Financing

                  	
                    36

                  
	
                    5.9

                  	
                    Litigation

                  	
                    36

                  
	
                    VI.
                      Agreements of Seller and Guarantor

                  	
                    37

                  
	
                    6.1

                  	
                    Conduct
                      of the Business

                  	
                    37

                  
	
                    6.2

                  	
                    Notice
                      of Developments

                  	
                    38

                  
	
                    6.3

                  	
                    Pre-Closing
                      Access

                  	
                    39

                  
	
                    6.4

                  	
                    Waivers;
                      Payment of Indebtedness

                  	
                    39

                  
	
                    6.5

                  	
                    Conditions

                  	
                    39

                  
	
                    6.6

                  	
                    No
                      Sale

                  	
                    40

                  
	
                    6.7

                  	
                    Closing
                      and Post-Closing Deliveries and Access

                  	
                    40

                  
	
                    6.8

                  	
                    Litigation
                      Support

                  	
                    40

                  
	
                    6.9

                  	
                    Nondisparagement

                  	
                    40

                  
	
                    6.10

                  	
                    Confidentiality

                  	
                    41

                  
	
                    6.11

                  	
                    Assignment
                      of Confidentiality Agreements

                  	
                    42

                  
	
                    6.12

                  	
                    Transfer
                      of Apollo Gold Exploration Property

                  	
                    42

                  
	
                    6.13

                  	
                    Employee
                      Matters

                  	
                    42

                  
	
                    6.14

                  	
                    Claims
                      Against Company Personnel

                  	
                    42

                  
	
                    6.15

                  	
                    No
                      Shareholder Approval

                  	
                    43

                  
	
                    VII.
                      Further Agreements

                  	
                    43

                  
	
                    7.1

                  	
                    Conditions

                  	
                    43

                  
	
                    7.2

                  	
                    Buyer
                      Permitted Updates

                  	
                    43

                  
	
                    7.3

                  	
                    Employment;
                      Employee Benefits

                  	
                    43

                  
	
                    7.4

                  	
                    Insurance

                  	
                    43

                  
	
                    7.5

                  	
                    Bonding

                  	
                    44

                  
	
                    7.6

                  	
                    Releases
                      from Guarantees

                  	
                    44

                  
	
                    7.7

                  	
                    Non-Hire

                  	
                    44

                  
	
                    7.8

                  	
                    Use
                      of Seller’s and Guarantor’s Names

                  	
                    44

                  
	
                    7.9

                  	
                    Post-Closing
                      Access

                  	
                    44

                  
	
                    7.10

                  	
                    Filings;
                      Other Action

                  	
                    45

                  
	
                    7.11

                  	
                    APO
                      19

                  	
                    45

                  
	
                    7.12

                  	
                    Standard
                      Leach Pad Leak

                  	
                    45

                  
	
                    VIII.
                      Conditions to Closing

                  	
                    45

                  
	
                    8.1

                  	
                    Conditions
                      to Buyer’s Obligations

                  	
                    45

                  
	
                    8.2

                  	
                    Conditions
                      to Seller’s Obligations

                  	
                    48

                  
	
                    IX.
                      Termination

                  	
                    49

                  
	
                    9.1

                  	
                    Termination

                  	
                    49

                  
	
                    9.2

                  	
                    Effect
                      of Termination

                  	
                    51

                  

          

           

          
            
              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

           

          
            	 	 
	
                    X.
                      Indemnification

                  	
                    51

                  
	
                    10.1

                  	
                    Indemnification
                      by Seller and Guarantor

                  	
                    51

                  
	
                    10.2

                  	
                    Indemnification
                      by Buyer Parties

                  	
                    53

                  
	
                    10.3

                  	
                    Third-Party
                      Actions Against Buyer Parties

                  	
                    54

                  
	
                    10.4

                  	
                    Third-Party
                      Actions Against Seller and Guarantor

                  	
                    55

                  
	
                    10.5

                  	
                    Sole
                      and Exclusive Remedy

                  	
                    57

                  
	
                    10.6

                  	
                    Tax
                      Adjustment

                  	
                    57

                  
	
                    XI.
                      Allocation of Taxes; Tax Return

                  	
                    57

                  
	
                    11.1

                  	
                    Allocation
                      of Tax Liabilities

                  	
                    57

                  
	
                    11.2

                  	
                    Tax
                      Return

                  	
                    57

                  
	
                    11.3

                  	
                    Income
                      and Loss Allocation

                  	
                    58

                  
	
                    11.4

                  	
                    Cooperation

                  	
                    58

                  
	
                    11.5

                  	
                    Audits

                  	
                    59

                  
	
                    11.6

                  	
                    Tax
                      Refunds

                  	
                    59

                  
	
                    11.7

                  	
                    Tax
                      Sharing Agreements

                  	
                    59

                  
	
                    11.8

                  	
                    Section
                      338(h)(10) Election

                  	
                    59

                  
	
                    11.9

                  	
                    Tax
                      Indemnification of Seller and Guarantor

                  	
                    60

                  
	
                    11.10

                  	
                    Tax
                      Indemnification of Buyer

                  	
                    61

                  
	
                    XII.
                      General

                  	
                    61

                  
	
                    12.1

                  	
                    Press
                      Releases and Announcements

                  	
                    61

                  
	
                    12.2

                  	
                    Expenses

                  	
                    61

                  
	
                    12.3

                  	
                    Amendment
                      and Waiver

                  	
                    61

                  
	
                    12.4

                  	
                    Notices

                  	
                    62

                  
	
                    12.5

                  	
                    Assignment

                  	
                    63

                  
	
                    12.6

                  	
                    No
                      Third-Party Beneficiaries

                  	
                    63

                  
	
                    12.7

                  	
                    No
                      Partnership and No Corporate Opportunity

                  	
                    63

                  
	
                    12.8

                  	
                    Severability

                  	
                    64

                  
	
                    12.9

                  	
                    Complete
                      Agreement

                  	
                    64

                  
	
                    12.10

                  	
                    Schedules

                  	
                    64

                  
	
                    12.11

                  	
                    Signatures;
                      Counterparts

                  	
                    64

                  
	
                    12.12

                  	
                    Governing
                      Law

                  	
                    64

                  
	
                    12.13

                  	
                    Specific
                      Performance

                  	
                    64

                  
	
                    12.14

                  	
                    Jurisdiction

                  	
                    65

                  
	
                    12.15

                  	
                    Waiver
                      of Jury Trial

                  	
                    65

                  
	
                    12.16

                  	
                    Construction

                  	
                    65

                  
	
                    12.17

                  	
                    Currency

                  	
                    66

                  
	
                    12.18

                  	
                    Time
                      of Essence

                  	
                    66

                  
	
                    12.19

                  	
                    Consequential
                      or Special Damages

                  	
                    66

                  
	 	 	 
	
                    Signatures

                  	 	67

          

        

      

      

      Exhibit
        A - Form of Promissory Note

      Exhibit
        B - Form of Transition Services Agreement

      Exhibit
        C - Form of Resignation and Waiver

      Exhibit
        D - Form of FIRPTA Certificate

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

          
          

        

      

      STOCK
        PURCHASE AGREEMENT

       

      This
        STOCK
        PURCHASE AGREEMENT
        (this
“Agreement”)
        among
        Jipangu Inc., a Japanese corporation (“Parent”),
        Jipangu International Inc., a Delaware corporation (“Buyer”,
        and
        together with Parent, the “Buyer
        Parties”),
        Apollo Gold, Inc., a Delaware corporation (“Seller”)
        and
        Apollo Gold Corporation, a Yukon Territory corporation (“Guarantor”)
        is
        made as of October 17, 2005.

       

      Recitals

       

      WHEREAS,
        Seller
        owns all of the outstanding capital stock of Florida Canyon Mining, Inc.,
        a
        Delaware corporation (“Florida
        Canyon”),
        Standard Gold Mining, Inc., a Delaware corporation (“Standard”)
        and
        Apollo Gold Exploration, Inc., a Delaware corporation (“Exploration”)
        (each,
        a “Company”
        and
        collectively, the “Companies”).

       

      WHEREAS,
        Seller
        desires to sell, and Buyer desires to buy, all of the outstanding capital
        stock
        of each Company on the terms and subject to the conditions set forth in this
        Agreement.

       

      WHEREAS,
        Guarantor owns all of the outstanding capital stock of Seller, and desires
        to
        induce Buyer to enter into this Agreement. 

       

      WHEREAS,
        Parent
        owns all of the outstanding capital stock of Buyer, and desires to induce
        Seller
        to enter into this Agreement. 

       

      WHEREAS,
        Seller
        will be responsible for the cancellation or payment of all indebtedness of
        the
        Companies to the Seller, Guarantor and their respective Subsidiaries prior
        to
        Closing. 

       

      WHEREAS,
        the
        parties have agreed to enter into a transitional services agreement to be
        performed after the sale and purchase of the Companies’ outstanding capital
        stock. 

       

      NOW,
        THEREFORE,
        in
        consideration of the mutual representations, warranties and agreements contained
        in this Agreement, and for other good and valuable consideration, the receipt
        and sufficiency of which are hereby acknowledged, the parties agree as
        follows:

       

      I.
          Definitions

       

      “Active
        Employee”
        means
        any employee employed on the Closing Date by any Company who is a bargaining
        unit employee currently covered by a collective bargaining agreement or employed
        exclusively by one or more of the Companies, including employees on temporary
        leave of absence, family medical leave, military leave, temporary disability
        or
        sick leave, but excluding employees on long-term disability leave.

       

      “2004
        Financial Statements”
        has the
        meaning set forth in Section 4.5.

       

      “2004
        Fiscal Year End”
        has the
        meaning set forth in Section 4.5.

       

      “Admitted
        Claim”
        has the
        meaning set forth in Section 10.1(d).

       

      
        
          
          

        

        
          -1-

          
            

          

        

        
          
          

        

      

       

      “Affiliate”
        has the
        meaning set forth in Rule 12b-2 under the Exchange Act.

       

      “Agreement”
        has the
        meaning set forth in the first paragraph of this Agreement.

       

      “Allocation
        Arbiter”
        has the
        meaning set forth in Section 11.8(c).

       

      “Basket
        Amount”
        has the
        meaning set forth in Section 10.1(b).

       

      “Business
        Day”
        means
        any day other than a Saturday, a Sunday, a Japanese or United States federal
        holiday or a Colorado state banking holiday.

       

      “Buyer”
        has the
        meaning set forth in the first paragraph of this Agreement.

       

      “Buyer
        Claim”
        has the
        meaning set forth in Section 10.1(c).

       

      “Buyer
        Indemnified Parties”
        has the
        meaning set forth in Section 10.3(a).

       

      “Buyer
        Losses”
        has the
        meaning set forth in Section 10.1(a).

       

      “Buyer
        Parties”
        has the
        meaning set forth in the first paragraph of this Agreement.

       

      “Buyer
        Permitted Update”
        has the
        meaning set forth in Section 7.2.

       

      “Buyer
        Third-Party Action”
        has the
        meaning set forth in Section 10.3(a).

       

      “Capital
        Lease”
        means a
        lease on which a Company is a lessee that is a capital lease as determined
        in
        accordance with GAAP.

       

      “Code”
        means
        the Internal Revenue Code of 1986, as amended.

       

      “Company”
        has the
        meaning set forth in the recitals of this Agreement.

       

      “Confidential
        Information”
        has the
        meaning set forth in Section 6.10(a).

       

      “Confidentiality
        Agreement”
        means
        the confidentiality agreement, dated March 16, 2005, between Guarantor and
        Parent.

       

      “Consent”
        means
        any authorization, consent, approval, filing, waiver, exemption or other
        action
        by or notice to any Person.

       

      “Contract”
        means a
        contract, agreement, lease, commitment or binding understanding, whether
        oral or
        written, that is in effect as of the date of this Agreement or any time after
        the date of this Agreement. For clarity in this Agreement, the term Contract
        includes the $16,936,130 reclamation bond issued by Safeco Insurance Company
        of
        America and the determinations of the Bureau of Land Management, the U.S.
        District Court for the District of Nevada and the Ninth Circuit Court of
        Appeals
        relating thereto.

       

      “Disclosure
        Schedule”
        means
        the schedule delivered by Seller to Buyer on or prior to the date of this
        Agreement.

       

      
        
          
          

        

        
          -2-

          
            

          

        

        
          
          

        

      

       

      “Employment
        Loss”
        has the
        meaning set forth in Section 10.1(a).

       

      “Encumbrance”
        means
        any charge, claim, easement, covenant, condition, equitable interest, lien,
        option, pledge, security interest, right of first refusal or restriction
        of any
        kind, including any restriction on use, voting, transfer, receipt of income
        or
        exercise of any other attribute of ownership.

       

      “Environmental
        Costs”
        has the
        meaning set forth in Section 4.17(a)(i).

       

      “Environmental
        Law”
        has the
        meaning set forth in Section 4.17(a)(ii).

       

      “ERISA”
        means
        the Employee Retirement Income Security Act of 1974, as amended, and the
        rules
        and regulations thereunder.

       

      “ERISA
        Affiliate”
        means
        any entity or trade or business that is treated as a member of the Companies’
        controlled group within the meaning of Section 414(b), (c), (m) or (o) of
        the
        Code.

       

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

       

      “Exploration”
        has the
        meaning set forth in the recitals of this Agreement.

       

      “Exploration
        Common Stock”
        has the
        meaning set forth in Section 2.1(c).

       

      “Exploration
        Property Transfers”
        has the
        meaning set forth in Section 6.12.

       

      “Exploration
        Shares”
        has the
        meaning set forth in Section 2.1(c).

       

      “Florida
        Canyon”
        has the
        meaning set forth in the recitals of this Agreement.

       

      “Florida
        Canyon Common Stock”
        has the
        meaning set forth in Section 2.1(a).

       

      “Florida
        Canyon Shares”
        has the
        meaning set forth in Section 2.1(a).

       

      “Further
        Subscription Documents”
        means
        the subscription agreement executed and delivered by Guarantor and Parent
        as of
        the date of this Agreement, together with the forms of warrant certificate
        and
        registration rights agreement attached as schedules thereto.

       

      “GAAP”
        means
        Canadian generally accepted accounting principles, as in effect from time
        to
        time.

       

      “Governmental
        Authorization”
        means
        any approval, consent, license, permit, waiver, registration or other
        authorization issued, granted, given, made available or otherwise required
        by
        any Governmental Entity or pursuant to Law.

       

      “Governmental
        Entity”
        means
        any federal, state, local, foreign, international or multinational entity
        or
        authority exercising executive, legislative, judicial, regulatory,
        administrative or taxing functions of or pertaining to government.

       

      
        
          
          

        

        
          -3-

          
            

          

        

        
          
          

        

      

       

      “Governmental
        Order”
        means
        any judgment, injunction, writ, order, ruling, award or decree by any
        Governmental Entity or arbitrator.

       

      “Hazardous
        Materials”
        has the
        meaning set forth in Section 4.17(a)(iii).

       

      “Indemnification
        Agreements”
        means
        the indemnification agreements listed in Schedule
        4.13,
        under
        subsection (ii) thereof.

       

      “Insider”
        means
        (i) any officer or director of Guarantor or Seller, (ii) any officer or director
        of any Company, (iii) any Member of the Immediate Family of any of the foregoing
        Persons or (iv) any Affiliate of an officer or director of Guarantor, Seller
        or
        any Company.

       

      “Intellectual
        Property Rights”
        means
        (i) rights in patents, patent applications and patentable subject matter,
        whether or not the subject of an application, (ii) rights in trademarks,
        service
        marks, trade names, trade dress and other designators of origin, registered
        or
        unregistered, (iii) rights in copyrightable subject matter or protectable
        designs, registered or unregistered, (iv) trade secrets, (v) rights in internet
        domain names, uniform resource locators and e-mail addresses, (vi) rights
        in
        semiconductor topographies (mask works), registered or unregistered, (vii)
        know-how and (viii) all other intellectual and industrial property rights
        of
        every kind and nature and however designated, whether arising by operation
        of
        Law, Contract, license or otherwise. 

       

      “IRS”
        means
        the United States Internal Revenue Service.

       

      “June
        Balance Sheet”
        has the
        meaning set forth in Section 4.5.

       

      “Knowledge
        of Seller”
        means
        the actual knowledge of the Knowledge Employees, or any knowledge that would
        have been acquired by any such Person upon reasonable inquiry and
        investigation.

       

      “Knowledge
        Employees”
        means
        R. David Russell, Melvyn Williams, Don Miller, Dick Nanna, David Young, Don
        Vagstad, James O’Neil, Jr., John Barta and Maxine O’Connell.

       

      “Law”
        means
        any, law, ordinance, regulation, statute or treaty of any Governmental
        Entity.

       

      “Liability”
        means
        any liability or obligation whether accrued, absolute, contingent, unliquidated
        or otherwise, whether due or to become due, whether known or unknown, and
        regardless of when asserted, including, without limiting the foregoing, all
        reclamation, restoration and cleanup activities associated with or arising
        out
        of conducting exploration and mining activities.

       

      “List”
        has the
        meaning set forth in Section 4.17(a)(iv).

       

      “Litigation”
        means
        any claim, action, arbitration, mediation, audit, hearing, investigation,
        proceeding, litigation or suit (whether civil, criminal, administrative,
        investigative or informal) commenced, brought, conducted or heard by or before,
        or otherwise involving, any Governmental Entity or arbitrator or
        mediator.

       

      
        
          
          

        

        
          -4-

          
            

          

        

        
          
          

        

      

       

      “Loss”
        means
        any Litigation, Governmental Order, complaint, claim, demand, damage,
        deficiency, penalty, fine, cost, amount paid in settlement, liability,
        obligation, Tax, Encumbrance, loss, expense or fee, including court costs
        and
        attorneys’ fees and expenses.

       

      “March
        Balance Sheet”
        has the
        meaning set forth in Section 4.5.

       

      “March
        Balance Sheet Date”
        has the
        meaning set forth in Section 4.5.

       

      “March
        Financial Statements”
        has the
        meaning set forth in Section 4.5.

       

      “Material
        Adverse Effect”
        means
        any change, effect, event or condition, individually or in the aggregate,
        that
        has had or would reasonably be expected to have a material adverse effect
        on the
        business, assets, properties, condition (financial or otherwise) or results
        of
        operations of any Company; provided that any change, effect, fact, event
        or
        condition that adversely affects gold or silver mining in Nevada generally,
        or
        the mining industry generally, shall not be considered a Material Adverse
        Effect
        to the extent that it does not disproportionately affect any of the Companies
        as
        compared to other gold or silver mining companies or the mining industry
        generally.

       

      “Material
        Contracts”
        has the
        meaning set forth in Section 4.13(a),
        and
        excludes licenses for “off-the-shelf” commercial software.

       

      “Member
        of the Immediate Family”
        of a
        Person means a spouse, parent, child, sibling, mother- or father-in-law,
        son- or
        daughter-in-law, and brother- or sister-in-law of such Person.

       

      “Mining
        Claims”
        has the
        meaning set forth in Section 4.9(a)

       

      “Ordinary
        Course of Business”
        means
        the ordinary course of business of the Companies consistent with past custom
        and
        practice (including with respect to quantity and frequency) as it has been
        conducted since January 1, 2004.

       

      “Organizational
        Documents”
        means
        (i) the articles or certificate of incorporation and the bylaws of a
        corporation, (ii) the partnership agreement and any statement of partnership
        of
        a general partnership, (iii) the limited partnership agreement and the
        certificate of limited partnership of a limited partnership, (iv) the limited
        liability company agreement and articles or certificate of formation of a
        limited liability company, (v) any charter or similar document adopted or
        filed
        in connection with the creation, formation or organization of a Person and
        (vi)
        any amendment to any of the foregoing.

       

      “Parent”
        has the
        meaning set forth in the first paragraph of this Agreement.

       

      “Payment”
        means
        any transfer of value, including any dividend, distribution, payment or
        extension of credit to, investment in, or repayment, cancellation or forgiveness
        of indebtedness of, a Person.

       

      
        
          
          

        

        
          -5-

          
            

          

        

        
          
          

        

      

       

      “Permitted
        Encumbrances”
        means
        (i) Encumbrances for Taxes and other governmental charges and assessments
        (except assessments for public improvements levied, pending or deferred against
        real property) that are not yet due and payable or which are being contested
        in
        good faith by appropriate proceedings (provided required payments have been
        made
        in connection with any such contest), (ii) Encumbrances of carriers,
        warehousemen, mechanics’ and materialmen and other like Encumbrances, including
        purchase money security interests, arising in the Ordinary Course of Business
        (provided lien statements have not been filed as of the Closing Date), (iii)
        survey exceptions, easements, rights of way and restrictions, zoning ordinances
        and restrictions or other limitations imposed by any Governmental Entity
        and
        other similar Encumbrances affecting real property and which do not unreasonably
        restrict the use thereof or Buyer’s proposed use thereof in the Ordinary Course
        of Business, (iv) statutory Encumbrances in favor of lessors arising in
        connection with any property leased to any Company, (v) Encumbrances reflected
        in the March Financial Statements or arising under Material Contracts (other
        than arising out of the breach thereof), (vi) reservations in federal patents,
        (vii) liens of pledges or deposits under workers’ compensation laws or similar
        legislation, unemployment insurance or other types of social security, (viii)
        rights reserved to or vested in any Governmental Entity to control or regulate
        any interest in the Property as imposed by applicable Law, and (ix) Encumbrances
        that will be removed prior to or in connection with the Closing.

       

      “Person”
        means
        any individual, corporation (including any non-profit corporation), general
        or
        limited partnership, limited liability company, joint venture, estate, trust,
        association, organization, labor union, Governmental Entity or other
        entity.

       

      “Plan”
        means
        every plan, fund, contract, program and arrangement (whether written or not)
        for
        the benefit of present or former employees, including those intended to provide
        (i) medical, surgical, health care, hospitalization, dental, vision, life
        insurance, death, disability, legal services, severance, sickness or accident
        benefits (whether or not defined in Section 3(1) of ERISA), (ii) pension,
        profit
        sharing, stock bonus, retirement, supplemental retirement or deferred
        compensation benefits (whether or not tax qualified and whether or not defined
        in Section 3(2) of ERISA) or (iii) salary continuation, unemployment,
        supplemental unemployment, severance, termination pay, change-in-control,
        vacation or holiday benefits (whether or not defined in Section 3(3) of ERISA),
        (w) that is maintained or contributed to by any Company, (x) that any Company
        has committed to implement, establish, adopt or contribute to in the future,
        (y)
        for which any Company is or may be financially liable as a result of the
        direct
        sponsor’s affiliation with any Company, or any Company’s shareholders (whether
        or not such affiliation exists at the date of this Agreement and notwithstanding
        that the Plan is not maintained by any Company for the benefit of its employees
        or former employees) or (z) for or with respect to which any Company is or
        may
        become liable under any common law successor doctrine, express successor
        liability provisions of Law, provisions of a collective bargaining agreement,
        labor or employment Law or agreement with a predecessor employer. Plan does
        not
        include any arrangement that has been terminated and completely wound up
        prior
        to the date of this Agreement and for which none of the Companies has any
        present or potential liability.

       

      “Process
        Agent”
        has the
        meaning set forth in Section 12.15.

       

      “Property”
        has the
        meaning set forth in Section 4.17(a)(v).

       

      “Public
        Filings”
        has the
        meaning set forth in Section 3.6.

       

      
        
          
          

        

        
          -6-

          
            

          

        

        
          
          

        

      

       

      “Real
        Property”
        has the
        meaning set forth in Section 4.9(a).

       

      “Registered
        Intellectual Property Rights”
        means
        Intellectual Property Rights that are the subject of a pending application
        or an
        issued patent, trademark, copyright, design right or other similar registration
        formalizing exclusive rights.

       

      “Registration
        Rights Agreement”
        means
        the registration rights agreement dated June 1, 2005 between Parent and
        Guarantor.

       

      “Regulatory
        Action”
        has the
        meaning set forth in Section 4.17(a)(vi).

       

      “Release”
        has the
        meaning set forth in Section 4.17(a)(vii).

       

      “Remedies
        Exception,”
        when
        used with respect to any Person, means except to the extent enforceability
        may
        be limited by applicable bankruptcy, insolvency, reorganization, moratorium
        or
        other laws affecting the enforcement of creditors’ rights generally and by
        general equitable principles. 

       

      “Required
        Insurance”
        has the
        meaning set forth in Section 7.4.

       

      “Required
        Releases”
        has the
        meaning set forth in Section 7.6.

       

      “Required
        Surety”
        has the
        meaning set forth in Section 7.5.

       

      “Return”
        means
        any return, declaration, report, estimate, information return and statement
        pertaining to any Taxes.

       

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

       

      “Section
        338 Forms”
        has the
        meaning set forth in Section 11.8(c).

       

      “Securities
        Act”
        means
        the Securities Act of 1933, as amended, and the rules and regulations
        thereunder.

       

      “Seller”
        has the
        meaning set forth in the first paragraph of this Agreement.

       

      “Seller
        Indemnified Parties”
        has the
        meaning set forth in Section 10.4(a).

       

      “Seller
        Losses”
        has the
        meaning set forth in Section 10.2(a).

       

      “Seller
        Permitted Update”
        has the
        meaning set forth in Section 6.2.

       

      “Seller
        Third-Party Action”
        has the
        meaning set forth in Section 10.4(a).

       

      “Seller’s
        Basket Amount”
        has the
        meaning set forth in Section 10.2(b).

       

      “Software”
        means
        computer programs or data in computerized form, whether in object code, source
        code or other form.

       

      
        
          
          

        

        
          -7-

          
            

          

        

        
          
          

        

      

       

      “Standard”
        has the
        meaning set forth in the recitals of this Agreement.

       

      “Standard
        Common Stock”
        has the
        meaning set forth in Section 2.1(c).

       

      “Standard
        Shares”
        has the
        meaning set forth in Section 2.1(c).

       

      “Subscription
        Agreement”
        means
        the subscription agreement dated June 1, 2005 between Parent and
        Guarantor.

       

      “Subsidiary”
        means
        any Person in which a controlling ownership interest is owned, directly or
        indirectly, by another Person.

       

      “Tax
        Affiliate”
        means
        the Companies and any other Person that is or was a member of an affiliated,
        combined or unitary group of which any Company is or was a member.

       

      “Taxes”
        means
        all taxes, charges, fees, levies or other assessments, including all net
        income,
        gross income, gross receipts, sales, use, ad valorem, transfer, franchise,
        profits, license, withholding, payroll, employment, social security,
        unemployment, excise, estimated, severance, stamp, occupation, property or
        other
        taxes, customs duties, fees, assessments or charges of any kind whatsoever,
        including all interest and penalties thereon, and additions to tax or additional
        amounts imposed by any Governmental Entity upon any Company or any Tax
        Affiliate. For purposes of this Agreement, “Taxes” also includes any obligations
        under any agreements or arrangements with any Person with respect to the
        liability for, or sharing of, Taxes (including pursuant to Treasury Regulation
        Section 1.1502-6 or comparable provisions of state, local or foreign Tax
        law)
        and including any liability for Taxes as a transferee or successor, by contract
        or otherwise.

       

      “Third-Party
        Environmental Claim”
        has the
        meaning set forth in Section 4.17(a)(viii).

       

      “Transition
        Services Agreement”
        means
        the transition services agreement to be entered into among Guarantor, the
        Companies and Buyer on the Closing Date in the form of Exhibit
        B.

       

      “Treasury
        Regulations”
        means
        the rules and regulations under the Code.

       

      “Trust
        Indenture”
        means
        the trust indenture dated November 4, 2004, as amended on December 13, 2004,
        between Guarantor and The Canada Trust Company, as trustee, for the benefit
        of
        the holders of Guarantor’s 12% Series 2004-B convertible secured
        debentures.

       

      “WARN
        Act”
        means
        the Worker Adjustment and Retraining Notification Act of 1988, as
        amended.

       

      “Water
        Rights”
        has the
        meaning set forth in Section 4.9(a)

       

      “Work
        Permits”has
        the
        meaning set forth in Section 4.18(c).

       

      
        
          
          

        

        
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      The
        following terms not defined above are defined in the sections of Article
        II
        indicated below:

       

      
        	
                Definition

              	 	
                Defined

              	 
	
                Buyer
                  Cure Period

              	 	 	
                9.1(b)(ii

              	
                )

              
	
                Closing

              	 	 	
                2.4(a

              	
                )

              
	
                Closing
                  Date

              	 	 	
                2.4(a

              	
                )

              
	
                D&O
                  Letters

              	 	 	
                2.4(b)(i)(H

              	
                )

              
	
                Estimated
                  Closing Date Net Book Value

              	 	 	
                2.3

              	 
	
                Exploration
                  Purchase Price

              	 	 	
                2.2

              	 
	
                Fee
                  Property

              	 	 	
                4.9(a

              	
                )

              
	
                July
                  Balance Sheet

              	 	 	
                4.5

              	 
	
                Listed
                  Personal Property

              	 	 	
                4.9(a

              	
                )

              
	
                Mines
                  Purchase Price

              	 	 	
                2.2

              	 
	
                Patented
                  Claims

              	 	 	
                4.9(a

              	
                )

              
	
                Promissory
                  Note

              	 	 	
                2.2

              	 
	
                Purchase
                  Price

              	 	 	
                2.2

              	 
	
                Seller
                  Cure Period

              	 	 	
                9.1(c)(ii

              	
                )

              
	
                Unaudited
                  Monthly Balance Sheets

              	 	 	
                2.3

              	 

      

      

      II.
          Purchase
        of Shares and Closing

       

      2.1  Purchase
        and Sale.
        At the
        Closing and on the terms and subject to the conditions set forth in this
        Agreement, Seller agrees to sell to Buyer, and Buyer agrees to buy from
        Seller:

       

      (a)  all
        of
        the issued and outstanding shares (the “Florida
        Canyon Shares”)
        of
        common stock, par value $0.001 per share, of Florida Canyon (“Florida
        Canyon Common Stock”);

       

      (b)  all
        of
        the issued and outstanding shares (the “Standard
        Shares”)
        of
        common stock, par value $0.001 per share, of Standard (“Standard
        Common Stock”);
        and

       

      (c)  all
        of
        the issued and outstanding shares (the “Exploration
        Shares”)
        of
        common stock, par value $0.001 per share, of Exploration (“Exploration
        Common Stock”).

       

      2.2  Purchase
        Price.
        The
        aggregate consideration for the Florida Canyon Shares and the Standard Shares
        is
        $12,500,000 (the “Mines
        Purchase Price”)
        and the
        consideration for the Exploration Shares is $1,500,000 (the “Exploration
        Purchase Price”).
        The
        aggregate consideration for the Florida Canyon Shares, the Standard Shares
        and
        the Exploration Shares (the “Purchase
        Price”)
        is
        $14,000,000. 

       

      Parent
        agrees to loan $2,500,000 to Guarantor, and Guarantor agrees to accept such
        loan, on the following terms: (i) concurrently with the execution of this
        Agreement, Guarantor will execute and deliver to Parent a $2,500,000 promissory
        note in the form attached as Exhibit
        A
        hereto
        (the “Promissory
        Note”);
        and
        (ii) concurrently with the execution of this Agreement or within one Business
        Day after the date of this Agreement, Parent will initiate a wire transfer
        of
        $2,500,000 to the account designated by Guarantor.

       

      
        
          
          

        

        
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      2.3  Unaudited
        Closing Date Balance Sheets.

       

      (a)  Through
        the Closing Date, Seller will deliver to Buyer, by the 20th
        day
        after the last day of the prior month, the unaudited balance sheet for each
        Company as of the last day of the prior month (the “Unaudited
        Monthly Balance Sheets”),
        prepared on a basis consistent with the March Financial Statements and in
        accordance with GAAP. “Estimated
        Closing Date Net Book Value”
        as of
        any date means the excess of the aggregate assets of the Companies over the
        aggregate liabilities of the Companies on such date. To
        the
        extent that the Estimated Closing Date Net Book Value as of the date of the
        Unaudited Monthly Balance Sheets is less than $12,500,000, the Buyer Parties
        may
        elect to terminate this Agreement by providing written notice to the Guarantor
        on or prior to the Closing Date.

       

      (b)  At
        least
        two Business Days prior to the Closing Date, Seller will deliver to Buyer
        an
        unaudited statement estimating the Estimated Closing Date Net Book Value
        as of
        the Closing Date. To the extent that the Estimated Closing Date Net Book
        Value
        as of the Closing Date is less than $12,500,000, the Buyer Parties may elect
        to
        terminate this Agreement by providing written notice to the Guarantor on
        or
        prior to the Closing Date.

       

      2.4  The
        Closing.

       

      (a)  The
        closing of the transactions contemplated by this Agreement (the “Closing”)
        will
        take place at the offices of Dorsey & Whitney LLP at Suite 3400, 1420 Fifth
        Avenue, Seattle, Washington, 98101, at 9:00 a.m. on November 15, 2005 or
        as soon
        thereafter as reasonably possible following satisfaction of the conditions
        set
        forth in Article VIII (the “Closing
        Date”)
        or at
        such other place and on such other date as may be mutually agreed by Buyer
        and
        Seller, in which case Closing Date means the date so agreed. The failure
        of the
        Closing will not ipso
        facto
        result
        in termination of this Agreement and will not relieve any party of any
        obligation under this Agreement. The Closing will be effective as of the
        close
        of business on the Closing Date.

       

      (b)  Subject
        to the conditions set forth in this Agreement, on the Closing Date:

       

      (i)  Seller
        will deliver to Buyer: 

       

      (A)  certificates
        representing all of the Florida Canyon Shares, the Standard Shares and the
        Exploration Shares, free and clear of all Encumbrances, duly endorsed or
        accompanied by duly executed stock powers;

       

      (B)  a
        certificate of an appropriate officer of Seller dated the Closing Date stating
        that the conditions set forth in subsections (a)
        through
(s)
        of
        Section 8.1
        have
        been satisfied;

       

      (C)  an
        updated Disclosure Schedule, prepared as though this Agreement has been dated
        as
        of the Closing Date, a good faith draft of which will have been submitted
        to
        Buyer no later than five calendar days prior to the Closing Date;

       

      
        
          
          

        

        
          -10-

          
            

          

        

        
          
          

        

      

       

      (D)  the
        text
        of the resolutions adopted by the board of directors of Seller authorizing
        the
        execution, delivery and performance of this Agreement, certified by an
        appropriate officer of Seller;

       

      (E)  the
        text
        of the resolutions adopted by the board of directors of Guarantor authorizing
        the execution, delivery and performance of this Agreement, certified by an
        appropriate officer of Guarantor;

       

      (F)  the
        minute books, stock or equity records, corporate seal and other materials
        related to the corporate administration of any Company;

       

      (G)  the
        amendments to the Indemnification Agreements referred to in Section 8.1(s);

       

      (H)  resignations,
        waivers and releases in
        writing (effective as of the Closing Date) from each officer and director
        of the
        Companies, substantially in the form attached as Exhibit
        C
        (the
“D&O Letters”);

       

      (I)  the
        Transition Services Agreement, duly executed by Seller, Guarantor and each
        Company;

       

      (J)  the
        Exploration Property Transfers, and any other instruments of transfer reasonably
        requested by Buyer Parties, duly executed by Seller or Guarantor, as
        applicable;

       

      (K)  evidence
        of payment or cancellation of indebtedness of the Companies to Seller, Guarantor
        or any Affiliate or Subsidiary of Seller or Guarantor that is to be canceled
        prior to Closing;

       

      (L)  executed
        copies of all agreements, instruments, certificates and other documents
        necessary or appropriate, in the reasonable opinion of Buyer Parties’ counsel,
        to release any and all Encumbrances against the assets of the Companies,
        other
        than Permitted Encumbrances, and Encumbrances that are listed on Schedule
        4.9
        and not
        required to be released by Section 8.1(m);

       

      (M)  a
        FIRPTA
        certificate in the form of Exhibit
        D,
        duly
        executed by Seller for purposes of satisfying Buyer’s obligations under Treasury
        Regulations Section 1.1445-2;

       

      (N)  copies
        of
        all documents relating to the substitution of collateral and release of Standard
        and Exploration share certificates pursuant to the Trust Indenture;
        and

       

      (O)  such
        other certificates, documents and instruments that Buyer Parties reasonably
        request for the purpose of (1) evidencing the accuracy of Seller’s and
        Guarantor’s representations and warranties, (2) evidencing the performance and
        compliance by Seller and Guarantor with the agreements contained in this
        Agreement, (3) evidencing the satisfaction of any condition referred to in
        Section 8.1
        or (4)
        otherwise facilitating the consummation of the transactions contemplated
        by this
        Agreement.

       

      
        
          
          

        

        
          -11-

          
            

          

        

        
          
          

        

      

       

      All
        actions to be taken by Seller or Guarantor in connection with consummation
        of
        the transactions contemplated by this Agreement and all certificates, opinions,
        instruments and other documents required to effect the transactions contemplated
        by this Agreement will be in form and substance reasonably satisfactory to
        Buyer
        Parties and Buyer Parties’ counsel.

       

      (ii)  Buyer
        will deliver to Seller:

       

      (A)  the
        Promissory Note in satisfaction of $2,500,000 of the Purchase
        Price;

       

      (B)  the
        remainder of the Purchase Price by wire transfer of immediately available
        funds
        to the account designated by Seller to Buyer no later than three Business
        Days
        prior to the Closing; 

       

      (C)  a
        certificate of an appropriate officer of Buyer dated the Closing Date stating
        that the conditions set forth in subsections (a)
        through
(g)
        of
        Section 8.2
        have
        been satisfied;

       

      (D)  the
        text
        of the resolutions adopted by the board of directors of Buyer authorizing
        the
        execution, delivery and performance of this Agreement, certified by an
        appropriate officer of Buyer;

       

      (E)  the
        text
        of the resolutions adopted by the board of directors of Parent authorizing
        the
        execution, delivery and performance of this Agreement, certified by an
        appropriate officer of Parent;

       

      (F)  evidence
        reasonably satisfactory to Seller that the Required Insurance, the Required
        Surety (but excluding the Safeco $16,936,130 and $120,000 bonds) and the
        Required Releases are in place and effective;

       

      (G)  the
        Transition Services Agreement, duly executed by Buyer; and

       

      (H)  such
        other certificates, documents and instruments that Seller or Guarantor
        reasonably request for the purpose of (1) evidencing the accuracy of Buyer
        Parties’ representations and warranties, (2) evidencing the performance and
        compliance by Buyer Parties with the agreements contained in this Agreement,
        (3)
        evidencing the satisfaction of any condition referred to in Section 8.2
        or (4)
        otherwise facilitating the consummation of the transactions contemplated
        by this
        Agreement.

       

      All
        actions to be taken by Buyer Parties in connection with consummation of the
        transactions contemplated by this Agreement and all certificates, opinions,
        instruments and other documents required to be delivered by Buyer Parties
        to
        effect the transactions contemplated by this Agreement will be in form and
        substance reasonably satisfactory to Seller and Seller’s counsel.

       

      
        
          
          

        

        
          -12-

          
            

          

        

        
          
          

        

      

       

      (c)  All
        items
        delivered by the parties at the Closing will be deemed to have been delivered
        simultaneously, and no items will be deemed delivered or waived until all
        have
        been delivered.

       

      (d)  The
        representations, warranties and agreements in this Agreement will survive
        the
        Closing.

       

      2.5  Further
        Assurances.
        After
        the Closing Date, each of the Buyer Parties, Seller and Guarantor will take
        all
        appropriate action and execute any documents, instruments or conveyances
        of any
        kind that may be reasonably requested by another party to carry out any of
        the
        provisions of this Agreement.

       

      III.
          Representations
        and Warranties of Seller
        and Guarantor

       

      Seller
        and Guarantor, jointly and severally, represent and warrant to Buyer Parties
        that, (i) except as described in the Disclosure Schedule, as of the
        date of
        this Agreement and, (ii) except as described in the Disclosure Schedule and
        any
        Seller Permitted Update, as of the Closing Date (as though made then and
        as
        though the Closing Date were substituted for the date of this
        Agreement):

       

      3.1  Title
        to Shares.
        Seller
        owns, of record and beneficially, the Florida Canyon Shares free and clear
        of
        any Encumbrance. Seller owns, of record and beneficially, the Standard Shares
        and the Exploration Shares free and clear of any Encumbrance other than the
        security interest granted to The Canada Trust Company under the Trust Indenture,
        which Encumbrance will be removed by Seller and Guarantor concurrently with
        the
        Closing. At Closing, Buyer will obtain good and valid title to the Florida
        Canyon Shares, the Standard Shares and the Exploration Shares, of record
        and
        beneficially, free and clear of any Encumbrance.

       

      3.2  Incorporation;
        Power and Authority.
        Each of
        Seller and Guarantor is duly organized, validly existing and in good standing
        under the laws of the jurisdiction of its organization. Each of Seller and
        Guarantor has all necessary power and authority to execute, deliver and perform
        this Agreement and the Transition Services Agreement.

       

      3.3  Valid
        and Binding Agreement.
        The
        execution, delivery and performance of this Agreement and the Transition
        Services Agreement by Seller or Guarantor, respectively, has been duly and
        validly authorized by all necessary corporate (including shareholder) or
        equivalent action. This Agreement has been duly executed and delivered by
        Seller
        and Guarantor and constitutes the valid and binding obligation of Seller
        and
        Guarantor, enforceable against each of them in accordance with its terms,
        subject to the Remedies Exception. The Transition Services Agreement, when
        executed and delivered by or on behalf of Seller or Guarantor, respectively,
        will constitute such Person’s valid and binding obligation, enforceable against
        it in accordance with its terms, subject to the Remedies Exception.

       

      3.4  No
        Breach; Consents.
        The
        execution, delivery and performance of this Agreement and the Transition
        Services Agreement by Seller or Guarantor, respectively, will not (a) contravene
        any provision of the Organizational Documents of Seller or Guarantor; (b)
        violate or conflict with any Law, Governmental Order or Governmental
        Authorization; (c) conflict with, result in any breach of any of the provisions
        of, constitute a default (or any event that would, with the passage of time
        or
        the giving of notice or both, constitute a default) under, result in a violation
        of, increase the burdens under, result in the termination, amendment,
        suspension, modification, abandonment or acceleration of payment (or any
        right
        to terminate) or require a Consent under any Contract or Governmental
        Authorization that is either binding upon or enforceable against Seller or
        Guarantor or any Governmental Authorization that is held by Seller or Guarantor;
        (d) result in the creation of any Encumbrance upon the Florida Canyon Shares,
        the Standard Shares or the Exploration Shares; (e) require any Governmental
        Authorization except those obtained; or (f) give any Governmental Entity
        or
        other Person the right to challenge any of the contemplated transactions
        or to
        exercise any remedy or obtain any relief under any Law, Governmental Order
        or
        Governmental Authorization.

       

      
        
          
          

        

        
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      3.5  Brokerage.
        No
        Person will be entitled to receive any brokerage commission, finder’s fee, fee
        for financial advisory services or similar compensation in connection with
        the
        transactions contemplated by this Agreement based on any Contract made by
        or on
        behalf of such Seller or Guarantor for which any Buyer Party or any Company
        is
        or could become liable or obligated.

       

      3.6  Public
        Filings.
        With
        respect to all reports, schedules, forms, statements and other documents
        filed
        or required to be filed by Guarantor with the SEC and with the securities
        regulatory authorities in Canada since January 1, 2004, the “Public
        Filings”,
        as of
        its date, each Public Filing, with respect to any content pertaining to any
        Company, complied in all material respects with the requirements of the
        Securities Act, the Exchange Act, or the applicable securities legislation
        in
        Canada, as the case may be, and the rules and regulations of the SEC or of
        the
        securities regulatory authorities in Canada promulgated thereunder applicable
        to
        such Public Filings. None of the Public Filings (with respect to any content
        pertaining to any Company) contains any untrue statement of a material fact
        or
        omits to state a material fact required to be stated therein or necessary
        in
        order to make the statements therein, in light of the circumstances under
        which
        they were made, not misleading, except to the extent that such statements
        have
        been modified or superseded by a later filed Public Filing.

       

      IV.
          Representations
        and Warranties Regarding the
        Companies

       

      Seller
        and Guarantor, jointly and severally, represent and warrant to Buyer Parties
        that (i) except as described in the Disclosure Schedule, as of the
        date of
        this Agreement and, (ii) except as described in the Disclosure Schedule and
        any
        Seller Permitted Update, as of the Closing Date (as though made then and
        as
        though the Closing Date were substituted for the date of this
        Agreement):

       

      4.1  Incorporation;
        Power
        and
        Authority.

       

      (a)  Each
        Company is a legal entity duly organized, validly existing and in good standing
        under the laws of the jurisdiction of its organization, and has all necessary
        power and authority necessary to own, lease and operate its assets and to
        carry
        on its business as currently conducted. Each Company is duly qualified to
        do
        business as a foreign corporation in each jurisdiction in which the nature
        of
        its business or its ownership of property requires it to be so qualified
        except
        where the failure to be so qualified would not have a Material Adverse Effect.
        Schedule
        4.1
        lists,
        for each Company, the jurisdiction of its organization, its form as a legal
        entity and each jurisdiction in which it is so qualified.

       

      
        
          
          

        

        
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      (b)  Each
        Company is in material compliance with all provisions of its Organizational
        Documents.

       

      4.2  No
        Breach;
        Consents.
        The
        execution, delivery and performance of this Agreement and the Transition
        Services Agreement by Seller, Guarantor or any Company, respectively, will
        not
(a)
        contravene any provision of the Organizational Documents of any Company;
        (b)
        violate or conflict with any Law, Governmental Order or Governmental
        Authorization; (c) conflict with, result in any breach of any of the provisions
        of, constitute a default (or any event that would, with the passage of time
        or
        the giving of notice or both, constitute a default) under, result in a violation
        of, increase the burdens under, result in the termination, amendment,
        suspension, modification, abandonment or acceleration of payment (or any
        right
        to terminate) or require a Consent under any Contract that is either binding
        upon or enforceable against any Company or any Governmental Authorization
        that
        is held by any Company; (d) result in the creation of any Encumbrance upon
        any
        Company or any of the assets of any Company; (e) require any Governmental
        Authorization except those obtained; or (f) give any Governmental Entity
        or
        other Person the right to challenge any of the contemplated transactions
        or to
        exercise any remedy or obtain any relief under any Law, Governmental Order
        or
        Governmental Authorization.

       

      4.3  Capitalization.

       

      (a)  The
        authorized capital stock of Florida Canyon consists of one thousand (1,000)
        shares of Florida Canyon Common Stock, of which one hundred (100) shares
        of
        Florida Canyon Common Stock are issued and outstanding and no shares of Florida
        Canyon Common Stock are held in treasury. All
        issued and outstanding shares of Florida Canyon Common Stock are duly
        authorized, validly issued, fully paid and nonassessable, free of preemptive
        rights or any third party voting, dividend, dispositive or other similar
        rights
        and in certificated form, and have been offered, sold and issued by Florida
        Canyon in compliance with applicable securities and corporate Laws, Contracts
        applicable to Florida Canyon and Florida Canyon’s Organizational Documents and
        in compliance with any preemptive rights, rights of first refusal or similar
        rights. The rights and privileges of the Florida Canyon Common Stock are
        set
        forth in Florida Canyon’s Organizational Documents or otherwise provided by
        Law.
        There is
        no option, warrant, call, subscription, convertible security, right (including
        preemptive right) or Contract of any character to which Florida Canyon is
        a
        party or by which it is bound obligating Florida Canyon to issue, exchange,
        transfer, sell, repurchase, redeem or otherwise acquire any capital stock
        of
        Florida Canyon or obligating Florida Canyon to grant, extend, accelerate
        the
        vesting of or enter into any such option, warrant, call, subscription,
        convertible security, right or Contract. There are no outstanding or authorized
        stock appreciation, phantom stock or similar rights with respect to Florida
        Canyon. Except for this Agreement, there are no registration rights agreements,
        no voting trust, proxy or other Contract and no restrictions on transfer
        with
        respect to any capital stock of Florida Canyon.

       

      
        
          
          

        

        
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      (b)  The
        authorized capital stock of Standard consists of one thousand (1,000) shares
        of
        Standard Common Stock, of which one hundred (100) shares of Standard Common
        Stock are issued and outstanding and no shares of Standard Common Stock are
        held
        in treasury. Except as set forth in Section 3.1,
        all
        issued and outstanding shares of Standard Common Stock are duly authorized,
        validly issued, fully paid and nonassessable, free of preemptive rights or
        any
        third party voting, dividend, dispositive or other similar rights and in
        certificated form, and have been offered, sold and issued by Standard in
        compliance with applicable securities and corporate Laws, Contracts applicable
        to Standard and Standard’s Organizational Documents and in compliance with any
        preemptive rights, rights of first refusal or similar rights. The rights
        and
        privileges of the Standard Common Stock are set forth in Standard’s
        Organizational Documents or otherwise provided by Law. Except as set forth
        in
        Section 3.1,
        there
        is no option, warrant, call, subscription, convertible security, right
        (including preemptive right) or Contract of any character to which Standard
        is a
        party or by which it is bound obligating Standard to issue, exchange, transfer,
        sell, repurchase, redeem or otherwise acquire any capital stock of Standard
        or
        obligating Standard to grant, extend, accelerate the vesting of or enter
        into
        any such option, warrant, call, subscription, convertible security, right
        or
        Contract. There are no outstanding or authorized stock appreciation, phantom
        stock or similar rights with respect to Standard. Except as set forth in
        Section
3.1
        or
        elsewhere in this Agreement, there are no registration rights agreements,
        no
        voting trust, proxy or other Contract and no restrictions on transfer with
        respect to any capital stock of Standard.

       

      (c)  The
        authorized capital stock of Exploration consists of one thousand (1,000)
        shares
        of Exploration Common Stock, of which one hundred (100) shares of Exploration
        Common Stock are issued and outstanding and no shares of Exploration Common
        Stock are held in treasury. Except as set forth in Section 3.1,
        all
        issued and outstanding shares of Exploration Common Stock are duly authorized,
        validly issued, fully paid and nonassessable, free of preemptive rights or
        any
        third party voting, dividend, dispositive or other similar rights and in
        certificated form, and have been offered, sold and issued by Exploration
        in
        compliance with applicable securities and corporate Laws, Contracts applicable
        to Exploration and Exploration’s Organizational Documents and in compliance with
        any preemptive rights, rights of first refusal or similar rights. The rights
        and
        privileges of the Exploration Common Stock are set forth in Exploration’s
        Organizational Documents or otherwise provided by Law. Except as set forth
        in
        Section 3.1,
        there
        is no option, warrant, call, subscription, convertible security, right
        (including preemptive right) or Contract of any character to which Exploration
        is a party or by which it is bound obligating Exploration to issue, exchange,
        transfer, sell, repurchase, redeem or otherwise acquire any capital stock
        of
        Exploration or obligating Exploration to grant, extend, accelerate the vesting
        of or enter into any such option, warrant, call, subscription, convertible
        security, right or Contract. There are no outstanding or authorized stock
        appreciation, phantom stock or similar rights with respect to Exploration.
        Except as set forth in Section 3.1
        or in
        this Agreement, there are no registration rights agreements, no voting trust,
        proxy or other Contract and no restrictions on transfer with respect to any
        capital stock of Exploration.

       

      4.4  Subsidiaries.
        None of
        the Companies owns any Subsidiary or has any ownership interest in any other
        Person, directly or indirectly.

       

      4.5  Financial
        Statements.
        The
        unaudited balance sheets as of July 31, 2005 of the Companies (the “July
        Balance Sheet”),
        the
        unaudited Balance Sheets as of June 30, 2005 of the Companies (the “June
        Balance Sheet”),
        the
        unaudited balance sheets as of March 31, 2005 (the “March
        Balance Sheet Date”)
        of the
        Companies (the “March
        Balance Sheet”)
        and
        the unaudited statements of income and cash flows of the Companies for the
        three-month period then ended (such statements and the March Balance Sheet,
        the
“March
        Financial Statements”)
        and
        the unaudited balance sheets, as of December 31, 2004 (the “2004
        Fiscal Year End”)
        of the
        Companies and the unaudited statements of income and cash flows of the Companies
        for the year ended on the 2004 Fiscal Year End (collectively, the “2004
        Financial Statements”)
        are
        based upon the books and records of the Companies, have been prepared in
        accordance with GAAP consistently applied during the periods indicated and
        present fairly the financial position, results of operations and cash flows
        of
        the Companies at the respective dates and for the respective periods indicated,
        except that none of the July Balance Sheet, the June Balance Sheet, the March
        Financial Statements or the 2004 Financial Statements contain footnotes.
        Each of
        the July Balance Sheet, the June Balance Sheet, March Financial Statements
        and
        2004 Financial Statements is attached hereto as Schedule
        4.5.

       

      
        
          
          

        

        
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      4.6  Absence
        of Undisclosed Liabilities.

       

      (a)  Except
        as
        disclosed in Schedule
        4.6(a) or
        as
        reflected or expressly reserved against in the March Balance Sheet, none
        of the
        Companies has any Liability, and there is no present or, to the Knowledge
        of
        Seller, threatened Litigation, charge, complaint, claim or demand against
        any of
        them giving rise to any Liability, and to the Knowledge of Seller, there
        is no
        fact or set of facts that is, or if discovered by a third party would be,
        reasonably likely to result in any such Litigation, charge, complaint, claim
        or
        demand, except (a) a Liability that has arisen after the date of the March
        Balance Sheet in the Ordinary Course of Business and that is not a Liability
        for
        breach of Contract, breach of warranty, tort, infringement, Litigation or
        violation of Governmental Order, Governmental Authorization (b) obligations
        that
        arise under any Contract listed on a Schedule to this Agreement or under
        a
        Contract not required to be listed on such a Schedule, or (c) reclamation
        Liabilities, which are addressed in paragraph (b) below.

       

      (b)  The
        reclamation Liability of each Company as set forth in the July Balance Sheet
        and
        the Unaudited Monthly Balance Sheets was estimated in compliance with GAAP
        and
        no event has occurred since July 31, 2005 that would (under GAAP) require
        any
        revision to such estimate, except as set forth in the Unaudited Monthly Balance
        Sheets. The Buyer Parties acknowledge and agree that, except with respect
        to the
        estimation having been made in compliance with GAAP in the preceding sentence,
        neither Seller nor Guarantor is making, and Seller and Guarantor expressly
        disclaim, any representation or warranty concerning the ultimate or aggregate
        reclamation Liability with respect to each Company or its Real Property,
        which
        shall remain the obligation of each Company after the Closing.

       

      (c)  None
        of
        the Companies is a party to, or is bound by, any hedging transaction or any
        off-balance sheet arrangement.

       

      4.7  Books
        and Records.
        The
        books of account of the Companies are complete and correct and, except as
        disclosed in Guarantor’s Form 10-K annual report for the year ended December 31,
        2004, under Item 9A thereof, have been maintained in accordance with sound
        business practices and the requirements of Section 13(b)(2) of the Exchange
        Act
        (regardless of whether the Companies are subject to that section). Each
        transaction is properly and accurately recorded on the books and records
        of a
        Company, and each document upon which entries in a Company’s books and records
        are based is complete and accurate in all respects. Except as disclosed in
        Guarantor’s Form 10-K annual report for the year ended December 31, 2004, under
        Item 9A thereof, each Company maintains a system of internal accounting controls
        adequate to insure that it maintains no off-the-books accounts and that its
        assets are used only in accordance with its management directives. The minute
        books and stock or equity records of each Company, all of which have been
        made
        available to Buyer Parties, are complete and correct. On and after April
        1,
        2002, the minute books of each Company, all of which have been made available
        to
        Buyer Parties, are complete and correct in all material respects. At the
        Closing, all such books and records will be in the possession of the Companies.
        The Companies own, and maintain in their records, all drilling results, records
        and other data of the Seller, Guarantor or any of their respective Subsidiaries
        relating to all properties in the State of Nevada that are owned, held,
        controlled, leased, used or occupied by the Companies.

       

      
        
          
          

        

        
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      4.8  Absence
        of Certain Developments.
        Since
        the 2004 Fiscal Year End, there has not been any Material Adverse Effect
        and,
        except as set forth in Schedule
        4.8:

       

      (a)  none
        of
        the Companies has sold, leased, licensed, transferred or assigned any of
        its
        assets, tangible or intangible, other than (i) for a fair consideration in
        the
        Ordinary Course of Business or (ii) transactions involving assets with an
        aggregate market value of less than $100,000;

       

      (b)  except
        as
        covered under subsection (a)
        above,
        none of the Companies has entered into any Contract (or series of related
        Contracts) either involving more than $100,000 or outside the Ordinary Course
        of
        Business;

       

      (c)  no
        party
        (including any Company) has accelerated, suspended, terminated, modified
        or
        canceled any Contract to which any Company is a party or by which any of
        them is
        bound that would have been a Material Contract at the time of any such
        action;

       

      (d)  no
        Encumbrance has been imposed on any assets of any Company except Permitted
        Encumbrances;

       

      (e)  except
        as
        disclosed on Schedule
        4.8(e),
        none of
        the Companies has made any capital expenditure (or series of related capital
        expenditures) either involving more than $100,000 or outside the Ordinary
        Course
        of Business;

       

      (f)  none
        of
        the Companies has made any capital investment in, any loan to, or any
        acquisition of the securities or assets of, any other Person (or series of
        related capital investments, loans and acquisitions) either involving more
        than
        $100,000 or outside the Ordinary Course of Business or acquired (by merger,
        exchange, consolidation, acquisition of stock or assets or otherwise) any
        Person;

       

      (g)  none
        of
        the Companies has issued any note, bond or other debt security or created,
        incurred, assumed or guaranteed any indebtedness for borrowed money (including
        advances on existing credit facilities) or Capital Lease either involving
        more
        than $50,000 individually or $100,000 in the aggregate;

       

      
        
          
          

        

        
          -18-

          
            

          

        

        
          
          

        

      

       

      (h)  none
        of
        the Companies has delayed, postponed or accelerated the payment of accounts
        payable or other Liability or the receipt of any accounts receivable, in
        each
        case outside the Ordinary Course of Business;

       

      (i)  none
        of
        the Companies has canceled, compromised, waived or released any right or
        claim
        (or series of related rights or claims) either involving more than $50,000
        or
        outside the Ordinary Course of Business;

       

      (j)  there
        has
        been no change made or authorized in the Organizational Documents of any
        Company;

       

      (k)  none
        of
        the Companies has issued, sold or otherwise disposed of any of its capital
        stock
        or equity interests, or granted any options, warrants or other rights to
        purchase or obtain (including upon conversion, exchange or exercise) any
        of its
        capital stock;

       

      (l)  none
        of
        the Companies has declared, set aside or paid any dividend or made any
        distribution with respect to its capital stock or equity interests (whether
        in
        cash or in kind) or redeemed, purchased or otherwise acquired any of its
        capital
        stock or split, combined or reclassified any outstanding shares of its capital
        stock;

       

      (m)  none
        of
        the Companies has experienced any material damage, destruction or loss (whether
        or not covered by insurance) to its property;

       

      (n)  none
        of
        the Companies has entered into any employment or collective bargaining
        agreement, written or oral, or modified the terms of any such existing
        agreement;

       

      (o)  none
        of
        the Companies has granted any increase in the base compensation or made any
        other change in employment terms of any of its directors, officers or employees
        outside the Ordinary Course of Business;

       

      (p)  none
        of
        the Companies has adopted, amended, modified or terminated any Plan (or taken
        any such action with respect to any Plan);

       

      (q)  none
        of
        the Companies has discharged or satisfied any Encumbrance or paid any liability,
        in each case with a value in excess of $50,000 individually or $100,000 in
        the
        aggregate, other than current liabilities paid in the Ordinary Course of
        Business;

       

      (r)  none
        of
        the Companies has disclosed to any Person other than Buyer Parties, Seller
        and
        Guarantor, and their respective authorized representatives any proprietary
        confidential information, other than pursuant to a confidentiality agreement
        prohibiting the use or further disclosure of such information;

       

      (s)  none
        of
        the Companies has made any change in accounting principles or practices from
        those utilized in the preparation of the March Financial Statements, except
        as
        required by any Law first becoming effective as of a date subsequent to the
        March Balance Sheet Date; and

       

      
        
          
          

        

        
          -19-

          
            

          

        

        
          
          

        

      

       

      (t)  none
        of
        the Companies has committed to take any of the actions described in this
        Section
4.8.
        

       

      4.9  Property.

       

      (a)  Schedule
        4.9
        sets out
        (i) all fee property owned, held or controlled by any Company (“Fee
        Property”),
        (ii)
        all patented mining and millsite claims of any Company (“Patented
        Claims”),
        (iii)
        all unpatented federal mining and millsite claims of any Company (“Mining
        Claims”),
        (iv)
        all surface and underground water and water rights, together with all
        applications for water rights or applications or permits for the use, transfer
        or change of water rights, ditch and ditch rights, well and well rights,
        reservoir and reservoir rights, stock or interests in irrigation or ditch
        companies appurtenant to the Real Property and all other rights to water
        for use
        at or in connection with the Real Property or the mining of minerals from
        the
        Real Property (“Water
        Rights”)
        owned,
        held or controlled by any Company, (v) all buildings, plants, offices, shops,
        warehouses, furnaces, smelters, refineries and other facilities of any Company
        and the real properties upon which such facilities are located, and (vi)
        all
        other fixed assets of any Company with a value of $5,000 or more (the
“Listed
        Personal Property”),
        including (A) all machinery and equipment of each Company, and (B) all other
        tangible assets and properties of each Company. The Fee Property, Patented
        Claims and Mining Claims will be collectively referred to hereinafter as
        the
“Real
        Property.”
        The
        Real Property listed on Schedule
        4.9
        constitutes all of the real property owned, held, controlled, leased, used
        or
        occupied by any Company.
        Except
        for the Companies, none of Seller, Guarantor or any of their respective
        Subsidiaries owns, holds, controls, leases, uses or occupies any property
        in the
        State of Nevada.

       

      (b)  Each
        Company owns (or in the case of the Mining Claims and Patented Claims listed
        in
Schedule
        6.12,
        will
        own at Closing) good and defensible record title to the Mining Claims and
        Patented Claims listed as owned by it on Schedule
        4.9.
        Except
        as provided on Schedule
        4.9
        and
        subject to the paramount title of the United States and the rights of third
        parties to use the surface of the Mining Claims pursuant to applicable Law,
        each
        Company owns (or in the case of the Mining Claims and Patented Claims listed
        in
Schedule
        6.12,
        will
        own at Closing) the Mining Claims and Patented Claims listed on Schedule 4.9
        as owned
        by it free and clear of any Encumbrances, other than Permitted Encumbrances
        arising by, through or under it. Except as provided on Schedule 4.9,
        with
        respect to the Mining Claims located by each Company: (i) the Mining Claims
        were
        properly laid out and monumented; (ii) location notices and certificates
        were properly recorded and filed with appropriate governmental agencies;
        (iii) assessment work which was performed in accordance with industry
        standards and which was reasonably sufficient to hold those Mining Claims
        has
        been performed and all Governmental Fees have been paid in a manner required
        by
        Law in order to maintain the Mining Claims through the 2005-06 assessment
        year;
        (iv) all affidavits of assessment work, evidence of payment of Governmental
        Fees, and other filings required to maintain the Mining Claims in good standing
        through the 2005-06 assessment year have been properly and timely recorded
        or
        filed with appropriate governmental agencies; and (v) to the Knowledge
        of
        Seller there are no third party patented or unpatented mining claims currently
        being maintained that are senior to and in conflict with those Mining
        Claims.

       

      (c)  Except
        as
        provided on Schedule 4.9,
        with
        respect to the Mining Claims not located by any of the Companies: (i) from
        and
        after the date each Company acquired its interest in those Mining Claims,
        assessment work which was performed in accordance with industry standards
        and
        which was reasonably sufficient to hold those Mining Claims has been performed
        and all Governmental Fees have been paid in a manner required by Law in order
        to
        maintain those Mining Claims through the 2005-2006 assessment year;
        (ii) all affidavits of assessment work, evidence of payment of Governmental
        Fees, and other filings required to maintain those Mining Claims in good
        standing through the 2005-2006 assessment year have been properly and timely
        recorded or filed with appropriate governmental agencies; and (iii) to
        the
        Knowledge of Seller, there are no third party patented or unpatented mining
        claims currently being maintained that are senior to and in conflict with
        those
        Mining Claims.

       

      
        
          
          

        

        
          -20-

          
            

          

        

        
          
          

        

      

       

      (d)  Seller
        and Guarantor do not make and hereby expressly disclaim any represen-tation
        or
        warranty as to (i) whether any of the Mining Claims contains a discovery
        of
        valuable minerals, (ii) the absence of any junior patented or unpatented
        mining claims in conflict with the Mining Claims, (iii) whether or
        not any
        of the Mining Claims comprise a contiguous group of claims or are free from
        interior gaps or fractions, (iv) whether or not any Company or its
        predecessors-in-title established or maintained pedis
        possessio
        rights
        with respect to any of the Mining Claims, (v) what rights any Company
        has
        to use the surface of any of the Mining Claims for any purpose; or
        (vi) otherwise as to the validity of any of the Mining Claims or the
        use of
        the same (except as specifically set forth in Sections 4.9(b)
        or
(c)
        above).

       

      (e)  Standard
        and Florida Canyon own sufficient Water Rights to operate their respective
        mines
        as they are currently being operated. Otherwise, Seller and Guarantor make
        no
        and expressly disclaim any representation or warranty with respect to priority,
        status, nature of permitted beneficial use or abandonment of any Water Rights,
        whether held by any Company of record, or in which any Company has a beneficial
        or other interest. 

       

      (f)  Each
        Company owns good and marketable title to (i) all of the Fee Property listed
        as
        owned by it, and (ii) the Listed Personal Property, in each case as identified
        on Schedule
        4.9,
        free
        and clear of all Encumbrances, except for Permitted Encumbrances and
        Encumbrances listed on Schedule
        4.9
        and
        leases listed on Schedule
        4.9
        entered
        into between (i) one or more of the Companies and (ii) Persons other than
        Seller, Guarantor and their respective Subsidiaries, in the Ordinary Course
        of
        Business. With respect to personal property located on the Companies’ premises
        that is not Listed Personal Property, but that relates to the Companies’
        business, each Company owns good and marketable title to such personal property,
        free and clear of all Encumbrances, except for Permitted Encumbrances and
        leases
        entered into between (i) one or more of the Companies and (ii) Persons other
        than Seller, Guarantor and their respective Subsidiaries, in the Ordinary
        Course
        of Business. All leases and licenses pursuant to which any Company leases
        or
        licenses real or personal property, including mining claims, are in good
        standing, valid and effective in accordance with their respective terms,
        and
        there is not, under any of such leases or licenses, any existing material
        default or event of default (or event which with notice or lapse or time,
        or
        both would constitute a material default; or would constitute a basis of
        force
        majeure or other claim of excusable delay or non-performance) of any Company
        and, to the Knowledge of Seller, no other Person in is default thereunder
        and no
        event has occurred that is reasonably likely to result in the revocation
        or
        withdrawal of any such rights and licenses.

       

      
        
          
          

        

        
          -21-

          
            

          

        

        
          
          

        

      

       

      (g)  The
        buildings, improvements, building systems, machinery, equipment and other
        tangible assets and properties used in the conduct of the business of each
        Company are in reasonable condition and repair, ordinary wear and tear excepted,
        and are adequate for the purposes for which they are now used. Except as
        set
        forth in Schedule
        4.9
        and
        Section 6.7, each Company owns or leases all of the assets, tangible and
        intangible, of any nature whatsoever, necessary to operate its business as
        currently conducted in all material respects.

       

      (h)  Except
        as
        disclosed in Schedule
        4.9(h),
        the
        Companies have now and, immediately following the consummation of the
        transactions contemplated by this Agreement, will have the right to occupy
        and
        use each of its properties in the same manner currently occupied and used
        by the
        Companies to conduct the business of the Companies as it is presently
        conducted.

       

      (i)  None
        of
        the Companies is obligated under any forward sale contract with respect to
        minerals produced or producible from the Real Property under which sales
        proceeds are paid by the purchaser in advance of delivery.

       

      (j)  Guarantor
        and Seller have made available, or caused the Companies to make available,
        to
        Buyer Parties all material information, data, geological and geophysical
        test
        results, maps and surveys in the possession of such Persons, requested by
        Buyer
        Parties relating to the Companies and their respective properties and business,
        and such Persons have not withheld from Buyer Parties any such material
        information, data, test results, maps or surveys. Seller and Guarantor represent
        and warrant that all such material information, data, test results, maps
        and
        surveys were prepared or procured by the Companies in the Ordinary Course
        of
        Business. Neither Seller nor Guarantor makes any representation or warranty
        as
        to the accuracy, reliability or completeness of any such information, data,
        test
        results, maps or surveys, and the Buyer Parties shall rely on the same at
        their
        sole risk. 

       

      (k)  The
        current reports regarding the Companies’ ore reserves (as set forth in the most
        recent Public Filings with respect to the Companies) and mine plans that
        Guarantor or Seller have made available, or caused the Companies to make
        available, to Buyer Parties were prepared in the Ordinary Course of Business
        and
        the ore reserve reports were audited by a third party.

       

      4.10  Accounts
        Receivable.
        All
        notes and accounts receivable of the Companies are reflected properly on
        their
        books of account, are valid, have arisen from bona fide transactions in the
        Ordinary Course of Business, are subject to no setoff or counterclaim, and
        are
        current and collectible. To the extent they become due and payable on or
        prior
        to the Closing date, such notes and accounts receivable will be collected
        in
        accordance with their terms (none of which is beyond 60 days) at their recorded
        amounts, subject only to the reserve for bad debts on the face of the March
        Balance Sheet as adjusted in the Companies’ books of account for the passage of
        time through the Closing Date in the Ordinary Course of Business.

       

      4.11  Tax
        Matters. 

       

      (a)  Each
        Company and any Tax Affiliate has (i) timely filed (or has had timely filed
        on
        its behalf) each material Return required to be filed or sent by it in respect
        of any material Taxes or required to be filed or sent by it by any Governmental
        Entity, each of which was correctly completed and accurately reflected in
        all
        material respects any liability for Taxes of such Company and any Tax Affiliate
        covered by such Return, (ii) timely and properly paid (or had paid on its
        behalf) all material Taxes due and payable for all Tax periods or portions
        thereof whether or not shown on such Returns, (iii) established in such
        Company’s books of account, in accordance with GAAP and consistent with past
        practices, adequate reserves for the payment of any Taxes not then due and
        payable and (iv) complied with all applicable Laws relating to the withholding
        of Taxes and the payment thereof. There are no material Taxes that would
        be due
        if asserted by a Governmental Entity, except with respect to which each Company
        and any Tax Affiliate are maintaining adequate reserves on the March Balance
        Sheet.

       

      
        
          
          

        

        
          -22-

          
            

          

        

        
          
          

        

      

       

      (b)  Each
        Company and any Tax Affiliate has made (or caused to be made on its behalf)
        all
        estimated tax payments required to have been made to avoid any underpayment
        penalties or has paid such penalties.

       

      (c)  There
        are
        no Encumbrances for Taxes upon any assets of any Company or any Tax Affiliate,
        except Encumbrances for Taxes not yet due and payable. There are no outstanding
        options, warrants, securities convertible into stock or other contractual
        obligations that might be treated for federal income tax purposes as stock
        or
        another equity interest in any Company.

       

      (d)  Neither
        any Company nor any Tax Affiliate has requested any extension of time within
        which to file any Return, which Return has not since been filed.

       

      (e)  Except
        as
        set forth in Schedule
        4.11(e),
        no
        deficiency for any Taxes has been asserted in writing or assessed against
        any
        Company or any Tax Affiliate that has not been resolved and paid in full.
        To the
        Knowledge of Seller, there are no proposed reassessments of any property
        owned
        by any Company or other proposals that could increase the amount of any Tax
        to
        which any Company could be subject. No waiver, extension or comparable consent
        given by any Company or any Tax Affiliate regarding the application of the
        statute of limitations with respect to any Taxes or any Return is outstanding,
        nor is any request for any such waiver or consent pending. There has been
        no Tax
        audit or other administrative proceeding or court proceeding with regard
        to any
        Taxes or any Return for any Company or Tax Affiliate, nor is any such Tax
        audit
        or other proceeding pending, nor has there been any written notice to any
        Company or any tax Affiliate by any Governmental Entity regarding any such
        Tax,
        audit or other proceeding, or, to the Knowledge of Seller, is any such Tax
        audit
        or other proceeding threatened with regard to any Taxes or Returns. There
        are no
        outstanding subpoenas or requests for information with respect to any of
        the
        Returns of any Company or any Tax Affiliate. Neither any Company nor any
        Tax
        Affiliate has entered into a closing agreement pursuant to Section 7121 of
        the
        Code or any similar provision under any other Law.

       

      (f)  To
        the
        Knowledge of Seller, no additional Taxes will be assessed against any Company
        or
        any Tax Affiliate for any Tax period or portion thereof ending on or prior
        to
        the Closing Date, and there are no unresolved questions, claims or disputes
        concerning the liability for Taxes of any Company or any Tax Affiliate that
        would exceed the estimated reserves established on its books of
        account.

       

      
        
          
          

        

        
          -23-

          
            

          

        

        
          
          

        

      

       

      (g)  Schedule
        4.11(g)
        lists
        all federal, state, local and foreign income Returns filed with respect to
        any
        Company or any Tax Affiliate for taxable periods ended on or after December
        31,
        2001, indicates those Returns that have been audited and indicates those
        Returns
        that currently are the subject of audit.

       

      (h)  To
        the
        Knowledge of Seller, neither any Company nor any Tax Affiliate has any material
        liability for Taxes in a jurisdiction where it does not file a Return, nor
        has
        any Company or any Tax Affiliate received written notice from a taxing authority
        in such a jurisdiction that it is or may be subject to taxation by that
        jurisdiction.

       

      (i)  The
        consummation of the transactions contemplated by this Agreement will not
        cause
        payments to be made by any Company or any Tax Affiliate that are not deductible
        (in whole or in part) to Buyer or with respect to any period beginning after
        Closing as a result of the application of Section 280G of the Code.

       

      (j)  No
        property of any Company or any Tax Affiliate is (i) property that any Company
        or
        any Tax Affiliate is or will be required to treat as being owned by another
        Person under the provisions of Section 168(f)(8) of the Code (as in effect
        prior
        to amendment by the Tax Reform Act of 1986), (ii)“tax-exempt use property”
        within the meaning of Section 168(h) of the Code or (iii) “tax-exempt bond
        financed property” within the meaning of Section 168(g)(5) of the
        Code.

       

      (k)  Neither
        any Company nor any Tax Affiliate is required to include in income any
        adjustment under either Section 481(a) or Section 482 of the Code (or an
        analogous provision of Law) by reason of a voluntary change in accounting
        method
        or otherwise, and to the Knowledge of Seller, the IRS has not proposed any
        such
        adjustment or change in accounting method. None of the Companies has any
        deferred income reportable for a period ending after the Closing Date but
        that
        is attributable to a transaction (e.g.,
        an
        installment sale) occurring in a taxable period (or portion thereof) ending
        on
        or prior to the Closing Date.

       

      (l)  No
        Company is a party to any Tax allocation or sharing agreement.

       

      (m)  None
        of
        the Companies (i) has been a member of an affiliated group filing a consolidated
        Return (other than a group the common parent of which is or was Seller or
        a
        Company) or (ii) has any liability for the Taxes of any Person (other than
        Seller or any Company) under Treasury Regulations Section 1.1502-6 (or any
        similar provision of Law), as a transferee or successor, by Contract, or
        otherwise.

       

      (n)  None
        of
        the Companies constitutes either a “distributing corporation” or a “controlled
        corporation” (within the meaning of Section 355(a)(1)(A) of the Code) in a
        distribution of shares qualifying for tax-free treatment under Section 355
        of
        the Code (i) that took place during the two-year period ending on the date
        of
        this Agreement or (ii) that could otherwise constitute part of a “plan” or
“series of related transactions” (within the meaning of Section 355(e) of the
        Code) in conjunction with the purchase of the Florida Canyon Shares, the
        Standard Shares and the Exploration Shares.

       

      (o)  None
        of
        the indebtedness of any Company or any Tax Affiliate constitutes (i) “corporate
        acquisition indebtedness” (as defined in Section 279(b) of the Code) with
        respect to which any interest deductions may be disallowed under Section
        279 of
        the Code or (ii) an “applicable high yield discount obligation” under Section
        163(i) of the Code, and none of the interest on any such indebtedness will
        be
        disallowed as a deduction under any other provision of the Code.

       

      
        
          
          

        

        
          -24-

          
            

          

        

        
          
          

        

      

       

      (p)  Neither
        any Company nor any Tax Affiliate has engaged in any transaction that is
        subject
        to disclosure under present or former Treasury Regulations Sections 1.6011-4
        or
        1.6011-4T, as applicable.

       

      (q)  There
        is
        no Contract, plan or arrangement, including this Agreement, by which any
        current
        or former employee of any Company would be entitled to receive any payment
        from
        any Company as a result of the transactions contemplated by this Agreement
        that
        would not be deductible pursuant to Section 404 or 162(m) of the
        Code.

       

      (r)  Each
        Company is currently, and will be as of the Closing Date, a member of a
        consolidated group within the meaning of Treasury Regulation Section 1.1502-1(h)
        of which the Seller is the common parent. 

       

      (s)  Neither
        any Company nor any Tax Affiliate is subject to accumulated earnings tax
        penalty
        or has received any written notification regarding a personal holding company
        tax. 

       

      (t)  None
        of
        the Companies has net operating losses or other tax attributes presently
        subject
        to limitation under Sections 382, 383 or 384 of the Code, or the separate
        return
        limitation year limitations of the federal consolidated return regulations
        (other than limitations imposed as a result of the transactions contemplated
        pursuant to this Agreement). 

       

      (u)  Any
        representation or warranty in this Section 4.11
        with
        respect to a Tax Affiliate (other than the Seller or any Company) shall be
        limited to any Taxes for which any Company may be liable for any reason and
        any
        other adverse Tax consequences to any Company.

       

      (v)  The
        representations and warranties set forth in this Section 4.11
        shall
        survive until the expiration of the applicable statute of
        limitations.

       

      4.12  Intellectual
        Property Rights»

       

      .
        The
        Companies do not own any Registered Intellectual Property Rights or own any
        material Intellectual Property Rights. Except as set forth in Section 6.7,
        the
        Companies own or have the right to use or otherwise employ all Intellectual
        Property Rights necessary for the operation of their business as presently
        conducted or proposed to be conducted, including, but not limited to, the
        right
        of each Company to use its corporate name. To the Knowledge of Seller, no
        complaints, either formal or informal, have been made alleging that any Company
        has infringed or is infringing or has violated or is violating any Intellectual
        Property Rights of a third party. To the Knowledge of Seller, none of the
        Companies are infringing or violating, and the operation of their business
        does
        not infringe or violate, any Intellectual Property Rights of
        another.

       

      4.13  Material
        Contracts.

       

      (a)  Schedule
        4.13
        lists
        the following Contracts currently in effect to which any Company is a party
        or
        subject or by which it is bound (the “Material
        Contracts”):

       

      
        
          
          

        

        
          -25-

          
            

          

        

        
          
          

        

      

       

      (i)  each
        employment, agency, collective bargaining or consulting Contract; 

       

      (ii)  each
        Contract (A) with any Insider, (B) between or among any Insiders relating
        in any
        way to any Company, or (C) with any employee of any Company;

       

      (iii)  each
        Contract concerning a partnership or joint venture;

       

      (iv)  each
        operating or royalty agreement; 

       

      (v)  each
        Capital Lease, lease of real or personal property, surface use agreement,
        right-of-way, easement, layback, subsidence or overstrip agreement;

       

      (vi)  each
        agreement relating to Water Rights;

       

      (vii)  each
        Contract or group of related Contracts with the same party for the purchase
        of
        products or services with a undelivered balance in excess of
        $100,000;

       

      (viii)  each
        Contract or group of related Contracts with the same party for the sale of
        products or services with an undelivered balance in excess of
        $100,000;

       

      (ix)  each
        Contract for the sale of any capital assets;

       

      (x)  each
        Contract for capital expenditures in excess of $100,000;

       

      (xi)  each
        Contract relating to the borrowing of money or to mortgaging, pledging or
        otherwise placing an Encumbrance on any of the assets of any
        Company;

       

      (xii)  each
        written warranty, guaranty, indemnity or other similar undertaking with respect
        to contractual performance extended by any Company;

       

      (xiii)  each
        written warranty, guaranty, indemnity or other similar undertaking extended
        by
        Guarantor or any of its Subsidiaries with respect to any obligation of any
        Company or any Contract to which any Company is a party or subject or by
        which
        it is bound;

       

      (xiv)  each
        Contract relating to any bond or other surety arrangement or letter of credit
        maintained or required to be maintained by any Company;

       

      (xv)  each
        Contract that contains or provides for an express undertaking by any Company
        to
        be responsible for consequential damages;

       

      (xvi)  each
        Contract containing exclusivity, non-competition or non-solicitation provisions
        or that would otherwise prohibit any Company from freely engaging in business
        anywhere in the world or prohibiting the solicitation of the employees or
        contractors of any other entity;

       

      (xvii)  each
        Contract providing for the development of any products, Software or Intellectual
        Property Rights or the delivery of any services by, for or with any third
        party;

       

      
        
          
          

        

        
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      (xviii)  each
        Contract pertaining to confidentiality or non-disclosure;

       

      (xix)  each
        Contract terminable by any other party upon a change of control of any Company
        or upon the failure of any Company to satisfy financial or performance criteria
        specified in such Contract;

       

      (xx)  each
        stock purchase, stock option and stock incentive plan (other than a
        Plan);

       

      (xxi)  each
        power of attorney that is currently in effect; and

       

      (xxii)  each
        other Contract of any Company not entered into in the Ordinary Course of
        Business or that is material to the business, financial condition, results
        of
        operations or prospects of the Companies taken as a whole. 

       

      (b)  Each
        Material Contract is valid and binding, currently in force and enforceable
        in
        accordance with its terms, subject to the Remedies Exception. Each Company
        has
        performed all material obligations required to be performed by it in connection
        with each Material Contract. To the Knowledge of Seller, none of the Companies
        has received any notice of any claim of default by it under or termination
        of
        any Material Contract. None of the Companies has any present expectation
        or
        intention of not fully performing any obligation pursuant to any Material
        Contract, and there is no breach, anticipated breach or default by a Company
        or,
        to the Knowledge of Seller, any other party to any Material Contract. To
        the
        Knowledge of Seller, there is no renegotiation of, attempt to renegotiate
        or
        outstanding right to renegotiate any material terms of any Material Contract
        and
        no Person has made written demand for such renegotiation. Each Company currently
        has the ability to perform each Material Contract for the sale of products
        or
        services, in accordance with the terms thereof.

       

      4.14  Litigation.
        Except
        as set forth on Schedule
        4.14,
        no
        Litigation is pending or, to the Knowledge of Seller, threatened against
        any
        Company and to the Knowledge of Seller there is no fact or set of facts that
        is,
        or if discovered by a third party would be, reasonably likely to result in
        any
        Litigation against any Company. None of the Companies is subject to any
        outstanding Governmental Order.

       

      4.15  Insurance.
        

       

      (a)  Schedule
        4.15
        lists
        each insurance policy in effect with respect to each Company and its business.
        Such insurance (i) is in full force and effect, (ii) is sufficient for
        compliance with all requirements of applicable Law and of any Material Contract
        to which any Company is subject and (iii) is valid and enforceable.

       

      (b)  Schedule
        4.15
        lists by
        year for the current policy year and each of the two preceding policy years
        a
        summary of the loss experience under each policy involving any claim in excess
        of $100,000. Schedule
        4.15
        also
        describes the loss experience for all claims in excess of $100,000 that were
        self-insured, including the aggregate cost of such claims.

       

      4.16  Compliance
        with Laws; Governmental Authorizations.

       

      
        
          
          

        

        
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      (a)  Each
        Company has complied with all applicable Laws and Governmental Orders in
        all
        material respects with respect to the conduct of its business. None of the
        Companies is relying on any exemption from or deferral of any Law, Governmental
        Order or Governmental Authorization that would not be available to it after
        the
        Closing.

       

      (b)  Each
        Company has in full force and effect all material Governmental Authorizations
        necessary to conduct its business as currently conducted and own and operate
        its
        properties. To the Knowledge of Seller, no fact exists and no event has occurred
        that is reasonably likely to result in the revocation or withdrawal of any
        such
        Governmental Authorization. Schedule
        4.16(b) lists
        each Governmental Authorization held by any Company. Except as set forth
        on
Schedule
        4.16(b),
        each
        Company is currently in compliance in all material respects with all
        Governmental Authorizations applicable to it. To the Knowledge of Seller,
        each
        Governmental Authorization will be valid and in full force and effect upon
        consummation of the transactions contemplated by this Agreement and none
        of the
        Companies is in violation or default under any such Government Authorization
        (or
        with notice or lapse of time or both, could reasonably be anticipated to
        be in
        violation or default under any such Government Authorization). 

       

      (c)  None
        of
        the representations and warranties set forth in this Section 4.16
        shall
        apply to Environmental Laws.

       

      4.17  Environmental
        Matters.

       

      (a)  As
        used
        in this Section 4.17,
        the
        following terms have the following meanings:

       

      (i)  “Environmental
        Costs”
        means
        any and
        all costs and expenditures, including any fees and expenses of attorneys
        and of
        environmental consultants or engineers incurred in connection with
        investigating, defending, remediating or otherwise responding to any Release
        of
        Hazardous Materials, any violation or alleged violation of Environmental
        Law,
        any fees, fines, penalties or charges associated with any Governmental
        Authorization, or any actions necessary to comply with any Environmental
        Law.

       

      (ii)  “Environmental
        Law”
        means
        any Law, Governmental Authorization or Governmental Order relating to pollution,
        contamination, Hazardous Materials or protection of the
        environment.

       

      (iii)  “Hazardous
        Materials”
        means
        any dangerous, toxic or hazardous pollutant, contaminant, chemical, waste,
        material or substance as defined in or governed by any Law relating to such
        substance or otherwise relating to the environment or human health or safety,
        including any waste, material, substance, pollutant or contaminant that might
        cause any injury to human health or safety or to the environment or might
        subject the owner or operator of the Property to any Environmental Costs
        or
        liability under any Environmental Law.

       

      (iv)  “List”
        means
        the United States Environmental Protection Agency’s National Priorities List
        (NPL) of Hazardous Substance Sites or CERCLA Information System (CERCLIS)
        or any
        similar list maintained by the Nevada Department of Environmental Protection
        with respect to sites from which there has been a Release of Hazardous
        Materials, including without limitation the Nevada Division of Environmental
        Protection Corrective Actions/Leaking Underground Storage Tank Project Tracking
        List.

       

      
        
          
          

        

        
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      (v)  “Property”
        means
        real property currently owned, leased, controlled or occupied by any
        Company. 

       

      (vi)  “Regulatory
        Action”
        means
        any Litigation with respect to any Company brought or instigated by any
        Governmental Entity in connection with any Environmental Costs, Release of
        Hazardous Materials or any Environmental Law.

       

      (vii)  “Release”
        means
        the spilling, leaking, disposing, discharging, emitting, depositing, ejecting,
        leaching, escaping or any other release or threatened release, however defined,
        whether intentional or unintentional, of any Hazardous Material.

       

      (viii)  “Third-Party
        Environmental Claim”
        means
        any Litigation (other than a Regulatory Action) based on negligence, trespass,
        strict liability, nuisance, toxic tort or any other cause of action or theory
        relating to any Environmental Costs, Release of Hazardous Materials or any
        violation of Environmental Law.

       

      (b)  No
        Third-Party Environmental Claim or Regulatory Action has been taken, is pending
        or is, to the Knowledge of Seller, threatened against any Company.

       

      (c)  No
        Property is listed on a List.

       

      (d)  To
        the
        Knowledge of Seller, all transfer, transportation or disposal of Hazardous
        Materials by any Company to properties not owned, leased or operated by any
        Company has been in compliance with applicable Environmental Law. None of
        the
        Companies has transported or arranged for the transportation of any Hazardous
        Materials to any location that is (i) listed on a List, (ii) to the Knowledge
        of
        Seller, listed for possible inclusion on any List or (iii) the subject of
        any
        Regulatory Action or Third-Party Environmental Claim. Set
        forth
        on Schedule
        4.17(d)
        is a
        list of all sites to which any of the Companies has sent or with which it
        has
        arranged for the disposal of Hazardous Materials.

       

      (e)  So
        long
        as Seller has owned the Companies (and to the Knowledge of Seller, prior
        thereto), no Property has ever been used as a landfill, dump or other disposal,
        storage, transfer, handling or treatment area for Hazardous Materials, or
        as a
        gasoline service station or a facility for selling, dispensing, storing,
        transferring, disposing or handling petroleum and/or petroleum products,
        other
        than as permitted in valid plans of operation, mine plans or other Governmental
        Authorizations pertaining to the Companies’ activities and
        operations.

       

      (f)  Except
        as
        set forth on Schedule
        4.17(f),
        there
        has not been any Release of any Hazardous Material on, under, about, from
        or in
        connection with the Property, including the presence of any Hazardous Materials
        that have come to be located on or under the Property from another location,
        for
        so long as Seller has owned the Companies (and, to the Knowledge of Seller,
        prior thereto), other than in compliance with applicable Environmental Laws,
        except for naturally occurring Releases of Hazardous Materials and for amounts
        below levels of regulatory enforcement of any Governmental Entity having
        jurisdiction.

       

      
        
          
          

        

        
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      (g)  So
        long
        as Seller has owned the Companies (and to the Knowledge of Seller, prior
        thereto), the Property at all times has been used and operated in all material
        respects in compliance with all applicable Environmental Law.

       

      (h)  Except
        as
        set forth on Schedule
        4.17(h)(1),
        each
        Company has obtained all Governmental Authorizations relating to the
        Environmental Law necessary for operations of the Companies as currently
        conducted. All such Governmental Authorizations are listed on Schedule
        4.17(h)(2).
        All
        material Governmental Authorizations relating to Environmental Laws will
        be
        valid and in full force and effect upon consummation of the transactions
        contemplated by this Agreement. Except as set forth on Schedule
        4.17(h)(2),
        no
        Environmental Law imposes any obligation upon any Company arising out of
        or as a
        condition to any transaction contemplated by this Agreement, including any
        requirement to modify or to transfer any Governmental Authorization, any
        requirement to file any notice or other submission with any Governmental
        Entity,
        the filing of any notice, acknowledgment or covenant in any land records,
        or the
        modification of or provision of notice under any agreement, consent order
        or
        consent decree. Each Company has filed all reports and notifications required
        to
        be filed under and pursuant to all applicable Environmental Law, except as
        set
        forth on Schedule
        4.17(h)(1).

       

      (i)  No
        Hazardous Materials have been generated, treated, contained, handled, located,
        used, manufactured, processed, buried, incinerated, deposited or stored on,
        under or about any part of the Property , other than in compliance with
        applicable Environmental Law, and except for naturally occurring Releases
        of
        Hazardous Materials and for amounts below levels of regulatory enforcement
        of
        any Governmental Entity having jurisdiction. To the Knowledge of Seller,
        the
        Property contains no asbestos, urea formaldehyde, radon at levels above natural
        background, PCBs or pesticides, in concentrations above applicable health-based
        regulatory levels established pursuant to Environmental Law. So long as Seller
        has owned the Companies (and to the Knowledge of Seller prior thereto), no
        underground storage tanks have been located on, under or about the Property
        and/or subsequently removed or filled. If any aboveground storage tanks exist
        on, under or about the Property, such storage tanks have been duly registered
        with all appropriate Governmental Entities as required and are otherwise
        in
        compliance with all applicable Environmental Law.

       

      (j)  All
        material environmental reports, plans and investigations that Guarantor,
        Seller,
        any Company or any of their respective Subsidiaries has prepared, obtained
        or
        ordered, or has in its possession or control, with respect to any Company,
        or
        the Property are listed on Schedule
        4.17(j)
        and were
        prepared, obtained or ordered in the Ordinary Course of Business. Seller
        makes
        no representation or warranty as to the accuracy, reliability or completeness
        of
        any such report, plan or investigation, and the Buyer Parties shall rely
        on the
        same at their sole risk.

       

      (k)  No
        Encumbrance has been attached or filed against any Company in favor of any
        Person for (i) any liability under or violation of any applicable Environmental
        Law, (ii) any Release of Hazardous Materials or (iii) any imposition of
        Environmental Costs. 

       

      4.18  Employees.

       

      
        
          
          

        

        
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      (a)  Schedule
        4.18(a)
        lists
        each employee of each Company as of the date of this Agreement, states the
        total
        number of employees and indicates for each such employee, and in the aggregate,
        full-time, part-time and temporary status.

       

      (b)  Schedule
        4.18(b)
        lists
        each salaried employee of any Company as of the date of this Agreement and
        shows
        for each such employee annual salary, any other compensation payable (including
        compensation payable pursuant to bonus, incentive, deferred compensation
        or
        commission arrangements), date of employment and position. To the Knowledge
        of
        Seller, no executive employee of any Company and no group of employees of
        any
        Company has any current plans to terminate his, her or their employment.
        Each
        Company has materially complied at all times with all applicable Laws relating
        to employment and employment practices and those relating to the calculation
        and
        payment of wages (including overtime pay, maximum hours of work and child
        labor
        restrictions), equal employment opportunity (including Laws prohibiting
        discrimination and/or harassment or requiring accommodation on the basis
        of
        race, color, national origin, religion, gender, disability, age, sexual
        orientation or otherwise), affirmative action and other hiring practices,
        occupational safety and health, workers’ compensation, unemployment
        compensation, the payment of social security and other Taxes, and unfair
        labor
        practices under the National Labor Relations Act or applicable state law.
        To the
        Knowledge of the Seller, the Companies’ labor relations are satisfactory. There
        are no workers’ compensation claims pending against any Company, or, to the
        Knowledge of Seller, any facts that would give rise to such a claim. No employee
        of any Company is subject to any secrecy or noncompetition agreement or any
        other agreement or restriction of any kind that would impede in any way the
        ability of such employee to carry out fully all activities of such employee
        in
        furtherance of the business of the Companies.

       

      (c)  To
        the
        Knowledge of Seller, no employee of any Company holds a temporary work
        authorization, including H-1B, L-1, F-1 or J-1 visas or work authorizations
        (the
“Work
        Permits”),
        or is
        required by Law to hold a Work Permit.
        To the
        Knowledge of Seller, no employee of any Company is (a) a non-immigrant employee
        whose status would terminate or otherwise be affected by the transactions
        contemplated by this Agreement, or (b) an alien who is authorized to work
        in the
        United States in non-immigrant status. For
        each
        employee of any Company hired after November 6, 1986, such Company has retained
        an Immigration and Naturalization Service Form I-9 completed in accordance
        with
        applicable Law.

       

      (d)  The
        employment of any terminated former employee of any Company has been terminated
        in accordance with any applicable Contract terms and applicable Law, and
        none of
        the Companies has any liability under any Contract or applicable Law toward
        any
        such terminated employee.

       

      (e)  The
        transactions contemplated by this Agreement will not cause any Company to
        incur
        or suffer any liability relating to, or obligation to pay, severance,
        termination, commission, bonus or other payment to any Person.

       

      (f)  None
        of
        the Companies has made any loans (except advances for business travel, lodging
        or other expenses in the Ordinary Course of Business) to any employee of
        any
        Company.

       

      
        
          
          

        

        
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      (g)  Except
        as
        disclosed in Schedule
        4.18(g),
        within
        the last five years, none of the Companies has experienced and, to the Knowledge
        of Seller, there has not been threatened, any strike, work stoppage, slowdown,
        lockout, picketing, leafleting, boycott, other labor dispute, union organization
        attempt, demand for recognition from a labor organization or petition for
        representation under the National Labor Relations Act or applicable state
        law.
        Except as disclosed in Schedule
        4.18(g),
        no
        grievance, demand for arbitration or arbitration proceeding arising out of
        or
        under any collective bargaining agreement is pending or, to the Knowledge
        of
        Seller, threatened. Except as disclosed in Schedule
        4.18(g),
        no
        Litigation is pending or, to the Knowledge of Seller, threatened respecting
        or
        involving any applicant for employment, any current employee or any former
        employee, or any class of the foregoing, including:

       

      (i)  the
        Equal
        Employment Opportunity Commission or any other corresponding state or local
        fair
        employment practices agency relating to any claim or charge of discrimination
        or
        harassment in employment;

       

      (ii)  the
        United States Department of Labor or any other corresponding state or local
        agency relating to any claim or charge concerning hours of work, wages or
        employment practices;

       

      (iii)  the
        Mine
        Safety and Health Administration, the Occupational Safety and Health
        Administration or any other corresponding state or local agency relating
        to any
        claim or charge concerning employee safety or health;

       

      (iv)  the
        Office of Federal Contract Compliance or any corresponding state agency;
        and

       

      (v)  the
        National Labor Relations Board or any corresponding state agency, whether
        relating to any unfair labor practice or any question concerning
        representation,

       

      and
        there
        is no fact or set of facts that is, or if discovered by a third party would
        be,
        reasonably likely to result in any such Litigation.

       

      (h)  No
        employee of any Company is covered by any collective bargaining agreement,
        and
        no collective bargaining agreement is being negotiated.

       

      (i)  Each
        of
        the Companies has paid in full to all employees all wages, salaries, bonuses
        and
        commissions due and payable to such employees and has fully reserved in its
        books of account all amounts for wages, salaries, bonuses and commissions
        due
        but not yet payable to such employees. 

       

      (j)  There
        has
        been no lay-off of employees or work reduction program undertaken by or on
        behalf of any Company since March 31, 2005, and no such program has
        been
        adopted by any Company or publicly announced.

       

      4.19  Employee
        Benefits.

       

      (a)  Schedule
        4.19 lists
        all
        Plans by name and provides a brief description identifying (i) the type of
        Plan,
        (ii) the sponsorship of the Plan, (iii) the participating employers in the
        Plan
        and (iv) any one or more of the following characteristics that may apply
        to such
        Plan: (A) defined contribution plan as defined in Section 3(34) of ERISA
        or
        Section 414(i) of the Code, (B) plan that is or is intended to be tax qualified
        under Section 401(a) or 403(a) of the Code, (C) employee welfare benefit
        plan as
        defined in Section 3(1) of ERISA, (D) plan providing benefits after separation
        from service or termination of employment. None of the Companies has any
        of the
        following, none of which shall be deemed a “Plan” for purposes of this Section
4.19:
        (i) a
        defined benefit plan as defined in Section 3(35) of ERISA or Section 414(j)
        of
        the Code, (ii) a plan that is or is intended to be an employee stock ownership
        plan as defined in Section 4975(c)(7) of the Code (and whether or not such
        plan
        has entered into an exempt loan), (iii) a nonqualified deferred compensation
        arrangement, (iv) a multiemployer plan as defined in Section 3(37) of ERISA
        or
        Section 414(f) of the Code, (v) a multiple employer plan maintained by more
        than
        one employer as defined in Section 413(c) of the Code, (vi) a plan that owns
        any
        Company or other employer securities as an investment, (vii) a plan that
        provides benefits (or provides increased benefits or vesting) as a result
        of a
        change in control of any Company, (viii) a plan that is maintained pursuant
        to
        collective bargaining, or (ix) a plan that is funded, in whole or in part,
        through a voluntary employees’ beneficiary association exempt from Tax under
        Section 501(c)(9) of the Code.

       

      
        
          
          

        

        
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      (b)  Neither
        the Companies nor any other trade or business, whether or not incorporated,
        that
        is, along with the Companies, treated as a single employer under sections
        414(b), (c) or (m) of the Code maintains, administers, contributes to, or
        has
        any liability with respect to an defined benefit pension plan subject to
        Title
        IV of ERISA.

       

      (c)  (i)
        except as set forth in Schedule
        4.19(c),
        all
        Plans intended to be Tax qualified under Section 401(a) or Section 403(a)
        of the
        Code are so qualified, (ii) all trusts established in connection with Plans
        intended to be Tax exempt under Section 501(a) or (c) of the Code are so
        Tax
        exempt, (iii) to the extent required either as a matter of Law or to obtain
        the
        intended Tax treatment and Tax benefits, all Plans comply in all material
        respects with the requirements of ERISA and the Code, (iv) all Plans have
        been
        administered in accordance with the documents and instruments governing the
        Plans, (v) all reports and filings with Governmental Entities (including
        the
        Department of Labor, the IRS and the SEC) required in connection with each
        Plan
        have been timely made, and (vi) all disclosures and notices required by Law
        or
        Plan provisions to be given to participants and beneficiaries in connection
        with
        each Plan have been properly and timely made.

       

      (d)  (i)
        all
        contributions, premium payments and other payments required to be made in
        connection with the Plans have been made, (ii) a proper accrual has been
        made on
        the books of account of the Companies for all contributions, premium payments
        and other payments due in the current fiscal year and not paid on or before
        the
        Closing Date, and (iii) no contribution, premium payment or other payment
        has
        been made in support of any Plan that is in excess of the allowable deduction
        for federal income Tax purposes for the year with respect to which the
        contribution was made (whether under Section 162, Section 280G, Section 404,
        Section 419, Section 419A of the Code or otherwise).

       

      (e)  The
        consummation of the transactions contemplated by this Agreement will not
        (i)
        cause any Plan to increase benefits payable to any participant or beneficiary,
        (ii) entitle any current or former employee of any Company to severance pay,
        unemployment compensation or any other payment, benefit or award or (iii)
        accelerate or modify the time of payment or vesting, or increase the amount
        of
        any benefit, award or compensation due any such employee.

       

      
        
          
          

        

        
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      (f)  (i)
        No
        Litigation is pending with regard to any Plan other than routine uncontested
        claims for benefits, (ii) no Plan is currently under examination or audit
        by the
        Department of Labor, the IRS or the Pension Benefit Guaranty Corporation,
        and
        (iii) with respect to the Plans, each Company has no liability (either directly
        or as a result of indemnification) for (and the transactions contemplated
        by
        this Agreement will not cause any liability for): (A) any excise Taxes under
        Section 4971 through Section 4980B, Section 4999, Section 5000 or any other
        Section of the Code, (B) any penalty under Section 502(i), Section 502(l),
        Part
        6 of Title I or any other provision of ERISA or (C) any excise Taxes, penalties,
        damages or equitable relief as a result of any prohibited transaction, breach
        of
        fiduciary duty or other violation under ERISA or any other applicable Law,
        (iv)
        all accruals required under FAS 106 and FAS 112 have been properly accrued
        on
        the March Financial Statements, (v) no condition, agreement or Plan provision
        limits the right of any Company to amend, cut back or terminate any Plan
        (except
        to the extent such limitation arises under ERISA) and (vi) none of the Companies
        has any liability for life insurance, death or medical benefits after separation
        from employment other than (A) death benefits under the Plans and (B) health
        care continuation benefits described in Section 4980B of the Code. 

       

      (g)  All
        persons who perform services to operate the Companies are common law employees
        of Florida Canyon and the Closing will not result in the termination of
        employment of any such employees. Neither the Companies nor the Buyer will
        have
        any liability under any Plan, except to the extent that (1) certain assets
        and
        liabilities of the Apollo Gold, Inc. Employee Savings Plan are transferred
        to a
        new plan established by the Companies, pursuant to item 3 of Schedule
        7.3,
        (2)
        certain portions of the Apollo Gold, Inc. Cafeteria Plan are spun-off to
        the
        Companies, pursuant to item 6 of Schedule
        7.3,
        and (3)
        certain claims incurred under the Apollo Gold Employee Health Benefit Plan
        on or
        before the Closing Date will be paid by the Buyer or the Companies, pursuant
        to
        item 2 of Schedule
        7.3,
        and (4)
        claims under Section 4980B of the Code with respect to M & A Qualified
        Beneficiaries, as defined under Section 54.4980B-9 of the Treasury Regulations,
        that are submitted to Seller after midnight of the Closing Date, all of which
        will be paid by the Companies and the Buyer.

       

      4.20  Suppliers.
        Schedule
        4.20
        lists
        the 10 largest suppliers of the Companies on a consolidated basis for each
        of
        the last two fiscal years and for the interim period ended on the March Balance
        Sheet Date and sets forth opposite the name of each such supplier the
        approximate dollar amount of purchases by the Companies attributable to such
        supplier for each such period, and whether such supplier is a sole source
        of
        supply for the Companies. To the Knowledge of Seller, no supplier listed
        on
Schedule
        4.20
        has
        stated that it will stop or decrease the rate of business done with any
        Company.

       

      4.21  Affiliate
        Transactions.
        No
        Insider or employee has any Contract with any Company (other than Contracts
        listed in Schedule
        4.13),
        any
        loan to or from any Company or any interest in any assets (whether real,
        personal or mixed, tangible or intangible) used in or pertaining to the business
        of any Company. To the Knowledge of Seller, no Insider has any direct or
        indirect interest in any competitor, supplier or vendor of any Company or
        in any
        Person from whom or to whom any Company leases any property, or in any other
        Person with whom any Company otherwise transacts business of any
        nature.

       

      
        
          
          

        

        
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      4.22  Brokerage.
        No
        Person will be entitled to receive any brokerage commission, finder’s fee, fee
        for financial advisory services or similar compensation in connection with
        the
        transactions contemplated by this Agreement based on any Contract made by
        or on
        behalf of any Company for which any Buyer Party or any Company is or could
        become liable or obligated.

       

      4.23  Availability
        of Documents.
        Seller
        has delivered to Buyer Parties correct and complete copies of the documents
        referred to in the Disclosure Schedule or in this Agreement.

       

      4.24  Disclosure.
        

       

      (a)  This
        Agreement, the exhibits, the Disclosure Schedule, the 2004 Financial Statements
        or the March Financial Statements do not contain any untrue statement or
        omit
        any material fact necessary to make the statements contained herein or therein,
        in light of the circumstances in which they were made, not
        misleading.

       

      (b)  Except
        as
        set forth in this Agreement or the Disclosure Schedule, to the Knowledge
        of
        Seller, there is no fact that has specific application to any Company (other
        than general economic or industry conditions) and that may materially adversely
        affect the assets, business, prospects, financial condition or results of
        operations of any Company.

       

      4.25  Disclaimer
        of Certain Representations or Warranties.
        THE
        PARTIES ACKNOWLEDGE AND AGREE THAT EXCEPT AS SPECIFICALLY PROVIDED IN THIS
        AGREEMENT, NONE OF SELLER, GUARANTOR OR THE COMPANIES MAKE ANY REPRESENTATIONS
        OR WARRANTIES, EXPRESS OR IMPLIED, (AND EACH OF SELLER, GUARANTOR, AND THE
        COMPANIES HEREBY DISCLAIM ANY SUCH REPRESENTATIONS OR WARRANTIES) WITH RESPECT
        TO THE MERCHANTABILITY OR SUITABILITY FOR A PARTICULAR PURPOSE OF ANY OF
        THE
        EQUIPMENT, FIXTURES, SUPPLIES OR OTHER PERSONAL PROPERTY OWNED BY THE
        COMPANIES.

       

      V.
          Representations
        and Warranties of Buyer
        Parties

       

      Buyer
        Parties, jointly and severally, represent and warrant to Seller that (i)
        as of
        the date of this Agreement, and (ii) except as described in any Buyer Permitted
        Update, as of the Closing Date (as though made then and as though the Closing
        Date were substituted for the date of this Agreement):

       

      5.1  Incorporation;
        Power
        and
        Authority.
        Each
        Buyer Party is a corporation duly organized, validly existing and in good
        standing under the Laws of its jurisdiction of organization, with all necessary
        power and authority to execute, deliver and perform this Agreement and, in
        the
        case of Buyer, the Transition Services Agreement.

       

      5.2  Valid
        and Binding Agreement.
        The
        execution, delivery and performance of this Agreement and the Transition
        Services Agreement by any Buyer Party have been duly and validly authorized
        by
        all necessary corporate action. This Agreement has been duly executed and
        delivered by each Buyer Party and constitutes the valid and binding obligation
        of such Buyer Party, enforceable against it in accordance with its terms,
        subject to the Remedies Exception. The Transition Services Agreement, when
        executed and delivered by Buyer, will constitute the valid and binding
        obligation of Buyer, enforceable against Buyer in accordance with its terms,
        subject to the Remedies Exception.

       

      
        
          
          

        

        
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      5.3  No
        Breach;
        Consents.
        The
        execution, delivery and performance of this Agreement and the Transition
        Services Agreement by any Buyer Party will not (a) contravene any provision
        of
        the Organizational Documents of such Buyer Party; (b) violate or conflict
        with
        any Law, Governmental Order or Governmental Authority; (c) conflict with,
        result
        in any breach of any of the provisions of, constitute a default (or any event
        that would, with the passage of time or the giving of notice or both, constitute
        a default) under, result in a violation of, increase the burdens under, result
        in the termination, amendment, suspension, modification, abandonment or
        acceleration of payment (or any right to terminate) or require a Consent,
        including any Consent under any Contract or Governmental Authorization that
        is
        either binding upon or enforceable against such Buyer Party; or (d) require
        any
        Governmental Authorization.

       

      5.4  No
        Other Representations; Suitability.Buyer
        is
        an “accredited investor”, as defined in Rule 501(a) under the Securities Act,
        and has such knowledge in financial and business affairs as to be capable
        of
        evaluating the merits and risks of its investment and is able to bear the
        economic risk of loss of its investment. The Buyer Parties acknowledge that
        Seller has given Buyer access to the documents and facilities of the Companies.
        The Buyer Parties acknowledge that neither Seller nor Guarantor make any
        representation or warranty with respect to the accuracy, reliability or
        completeness of the conclusions set forth in any projections, estimates or
        budgets delivered to or made available to Buyer regarding the future revenues,
        future results of operations (or any component thereof), future cash flows
        or
        future financial condition (or any component thereof) of any Company or the
        future business and operations of any Company.

       

      5.5  Brokerage.
        No
        Person will be entitled to receive any brokerage commission, finder’s fee, fee
        for financial advisory services or similar compensation in connection with
        the
        transactions contemplated by this Agreement based on any Contract made by
        or on
        behalf of any Buyer Party for which Seller or Guarantor is or could become
        liable or obligated.

       

      5.6  Investment
        Intent.
        Buyer
        is acquiring the Florida Canyon Shares, the Standard Shares and the Exploration
        Shares for its own account for investment purposes, and not with a view to
        the
        distribution thereof.

       

      5.7  Financial
        Condition.
        Buyer
        is, and immediately after giving effect to the transactions contemplated
        under
        this Agreement will be, able to pay its debts and obligations as they mature
        and
        come due.

       

      5.8  Financing.
        Buyer
        Parties have sufficient cash, available lines of credit or other sources
        of
        immediately available funds to enable it to make payment of the Purchase
        Price.

       

      5.9  Litigation.
        There
        is no action, suit or proceeding pending or, to the Buyer Parties’ knowledge,
        threatened against or affecting either Buyer Party at law or in equity, or
        before any Governmental Entity, which seeks to delay or question the validity
        of
        this Agreement or the transactions contemplated hereby or would otherwise
        have a
        material adverse effect on either Buyer Party.

       

      
        
          
          

        

        
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      VI.
          Agreements
        of Seller and Guarantor

       

      Seller
        and Guarantor, jointly and severally, agree with Buyer Parties
        that:

       

      6.1  Conduct
        of the Business.
        Seller
        and Guarantor will cause each Company to observe the following provisions
        to and
        including the Closing Date:

       

      (a)  each
        Company will conduct its business only in, and none of the Companies will
        take
        any action except in, the Ordinary Course of Business and in accordance with
        applicable Law, except with the prior written consent of Parent;

       

      (b)  none
        of
        the Companies will amend or modify any Material Contract or enter into any
        Contract that would have been a Material Contract if such Contract had been
        in
        effect on the date of this Agreement, except with the prior written consent
        of
        Parent;

       

      (c)  each
        Company will (i) use its reasonable efforts to preserve its assets, business
        organization and goodwill, keep available the services of its officers,
        employees and consultants and maintain satisfactory relationships with vendors,
        suppliers and others having business relationships with it, (ii), subject
        to
        applicable Laws, confer on a regular and frequent basis with representatives
        of
        Buyer Parties to report operational matters and the general status of ongoing
        operations as requested by Buyer Parties and (iii) not take any action that
        would render, or that reasonably may be expected to render, any representation
        or warranty made by Seller or Guarantor in this Agreement untrue at the Closing
        as though then made and as though the Closing Date had been substituted for
        the
        date of this Agreement in such representation or warranty, including any
        actions
        referred to in Section 4.8;

       

      (d)  except
        with the prior written consent of Parent or in the Ordinary Course of Business,
        none of the Companies will use extraordinary selling efforts that would have
        the
        effect of accelerating sales prior to the time reasonably expected, through
        offering of discounts, shipment of goods prior to anticipated shipping dates
        or
        otherwise;

       

      (e)  except
        with the prior written consent of Parent, which shall not be unreasonably
        withheld, none of the Companies will (i) make or rescind any express or deemed
        election or take any other discretionary position relating to Taxes except
        in
        accordance with past practice, (ii) amend any Return, (iii) settle or compromise
        any Litigation relating to Taxes or (iv) change any of its methods of reporting
        income or deductions for federal or state income Tax purposes from those
        employed in the preparation of the last filed federal or state income Tax
        Returns;

       

      (f)  none
        of
        the Companies will change any of its methods of accounting in effect on the
        March Balance Sheet Date, other than changes required by Law or by GAAP or
        consented to in writing by Parent;

       

      
        
          
          

        

        
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      (g)  except
        with the prior written consent of Parent, none of the Companies will cancel
        or
        terminate any of its current insurance policies or reclamation or surety
        bonds,
        or allow any of the coverage thereunder to lapse, unless simultaneously with
        such termination, cancellation or lapse replacement policies providing coverage
        equal to or greater than the coverage under the canceled, terminated or lapsed
        policies for substantially similar premiums are in full force and
        effect;

       

      (h)  except
        in
        the Ordinary Course of Business, none of the Companies will repay any
        indebtedness to Guarantor or any of its Subsidiaries, or will declare, set
        aside
        or pay any cash dividends on or make any other cash distributions in respect
        of
        any capital stock; and

       

      (i)  except
        with the prior written consent of Parent, none of the Companies will declare,
        set aside or pay any non-cash dividends on or make any other non-cash
        distributions (whether in stock, equity securities or property) in respect
        of
        any capital stock or split, combine or reclassify any capital stock or issue
        or
        authorize the issuance of any securities in respect of, in lieu of or in
        substitution for any capital stock.

       

      6.2  Notice
        of Developments.
        Seller
        and Guarantor will promptly notify Buyer Parties of any emergency or other
        change in the Ordinary Course of Business of any Company or the commencement
        or
        threat of Litigation pertaining in any way to any Company or its business
        or the
        transactions contemplated by this Agreement. Seller and Guarantor will promptly
        notify Buyer Parties in writing if Seller or Guarantor should discover that
        any
        representation or warranty made by Seller or Guarantor in this Agreement
        was
        when made, has subsequently become or will be on the Closing Date untrue
        in any
        respect. No disclosure pursuant to this Section 6.2
        will be
        deemed to amend or supplement the Disclosure Schedule or to prevent or cure
        any
        inaccuracy, misrepresentation, breach of warranty or breach of agreement,
        unless:

       

      (a)  the
        disclosure is made in writing at least five calendar days prior to the earlier
        of the Closing Date or December 1, 2005;

       

      (b)  the
        disclosure is identified by Seller as an exception to a specific representation
        or warranty set forth in Article III or IV, or as a modification of a specific
        section of the Disclosure Schedule;

       

      (c)  the
        disclosure contains the same level of detail as would have been required
        to be
        included in the Disclosure Schedule delivered on the date of this Agreement,
        had
        such fact or matter been disclosed therein;

       

      (d)  none
        of
        the Knowledge Employees had actual knowledge of such fact or matter on or
        prior
        to the date of this Agreement
        or would
        have acquired any such knowledge upon reasonable inquiry and investigation;
        and

       

      (e)  the
        fact
        or matter did not result from any willful or intentional failure to disclose
        by
        Seller, Guarantor or any Affiliate thereof (a disclosure that satisfies all
        such
        requirements, a “Seller
        Permitted Update”).

       

      
        
          
          

        

        
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      6.3  Pre-Closing
        Access.
        Through
        the Closing Date, Seller and Guarantor will cause each Company to afford
        to
        Buyer Parties and their authorized representatives full access at all reasonable
        times and upon reasonable notice to the facilities, offices, properties,
        technology, processes, books, business and financial records, officers,
        employees, business plans, budgets, and projections, vendors, suppliers and
        other information of each Company, and otherwise provide such assistance
        as may
        be reasonably requested by Buyer Parties in order that Buyer Parties have
        a full
        opportunity to make such investigation and evaluation as they reasonably
        desire
        to make of the business and affairs of each Company. In addition, Seller
        and
        Guarantor will cause each Company to cooperate fully (including providing
        introductions where necessary) with Buyer Parties to enable Buyer Parties
        to
        contact third parties, including employees, suppliers and vendors of each
        Company, and to communicate with employees of each Company. Subject to Laws,
        Buyer Parties will have full access to the personnel records (including
        performance appraisals, disciplinary actions, grievances and medical records)
        of
        each Company for the purpose of preparing for and conducting interviews with
        Active Employees. Seller and Guarantor will provide or cause each Company
        to
        provide such Plan documents and summary plan descriptions, employee data
        or
        other information as may be reasonably required to carry out the arrangements
        described in Schedule
        7.3.
        At the
        request of Buyer Parties, Seller and Guarantor will consent and cause the
        Companies to consent to Deloitte & Touche LLP making its workpapers
        available to or at the direction of the Buyer Parties.

       

      6.4  Waivers;
        Payment of Indebtedness.
        To
        assure that Buyer Parties obtain the full benefit of this
        Agreement:

       

      (a)  Seller
        and Guarantor will cause all indebtedness of the Companies to Seller, Guarantor
        or any of their respective Subsidiaries (except for any indebtedness from
        one
        Company to another Company), including, but not limited to, the amounts included
        in the “INTERCOMPANY PAYABLE (Home Office)” line item on the Companies’ March
        Balance Sheet, to be canceled or paid, without recourse to any assets of
        the
        Companies and without any adverse Tax consequences to any of the Companies
        or
        Buyer Parties, prior to the Closing; 

       

      (b)  Seller
        and Guarantor will cause Seller, Guarantor and any Person controlled by Seller
        or Guarantor to repay, in full, prior to the Closing, all indebtedness owed
        to
        any Company by such Person;

       

      (c)  effective
        as of the Closing Date, Seller and Guarantor waive any claim they might have
        against any Company, whether arising out of this Agreement or otherwise,
        and
        irrevocably offer to terminate any Contract between Seller, Guarantor or
        any of
        their respective Subsidiaries and any Company at no cost to any Company;
        and

       

      (d)  Seller
        and Guarantor waive any claim they might have against any Company by virtue
        of
        the representations and warranties pertaining to such Company under this
        Agreement. 

       

      6.5  Conditions.
        Seller
        and Guarantor will use their reasonable efforts to cause the conditions set
        forth in Section 8.1
        to be
        satisfied and to consummate the transactions contemplated by this Agreement
        as
        soon as reasonably possible and in any event prior to the Closing
        Date.

       

      
        
          
          

        

        
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      6.6  No
        Sale.
        Seller
        will not sell, pledge, transfer or otherwise place any Encumbrance on any
        Florida Canyon Shares, Standard Shares or Exploration Shares prior to the
        Closing. Seller and Guarantor will cause the Companies not to issue or agree
        to
        issue any share of capital stock, option, warrant, call, subscription,
        convertible security or similar right to obtain an equity security of any
        Company prior to the Closing.

       

      6.7  Closing
        and Post-Closing Deliveries and Access.
        After
        the Closing Date, Seller and Guarantor will afford to Buyer Parties and the
        Companies, their accountants and counsel, during normal business hours, upon
        reasonable request, full access to the books and records of Seller and Guarantor
        pertaining to each Company. Seller and Guarantor shall deliver to the Companies,
        by the Closing Date, in electronic form all material databases, files and
        other
        materials maintained by Seller and Guarantor in electronic form that relate
        to
        the Companies and their business; provided, that Seller and Guarantor shall
        be
        permitted to segregate the portion of any material databases, files and other
        materials that relate to the Companies and their business, and deliver only
        such
        portion to the Companies. Seller and Guarantor certify that, to the Knowledge
        of
        Seller, the Companies own or license all equipment and software necessary
        to
        access, modify, print and otherwise use such materials in their electronic
        form.
        Notwithstanding the foregoing, Buyer Parties acknowledge that after the Closing
        Date the Companies (i) will not be connected to or able to use the email
        system
        or other communications networks of Seller and Guarantor, (ii) will not be
        included in Seller’s or Guarantor’s website, nor will Seller or Guarantor create
        an independent website for the Companies, and (iii) may not have a license
        to
        the Software listed on Schedule
        6.7.
        Seller
        and Guarantor will use their reasonable efforts to assist Buyer in obtaining,
        effective on or prior to the Closing Date, on its own behalf or on behalf
        of the
        Companies, licenses to the Software listed on Schedule
        6.7.
        Seller
        and Guarantor shall deliver to the Companies, by the Closing Date, all material
        files and other documents in the possession or control of Seller and Guarantor
        in hard copy that relate to the Companies or their business; provided, that
        Seller and Guarantor shall be permitted to segregate the portion of any material
        files and other documents that relate to the Companies and their business,
        and
        deliver only such portion to the Companies. At the request of Buyer Parties
        or
        the Companies, Seller and Guarantor will consent to Deloitte & Touche LLP
        making its notepapers available to or at the direction of the Buyer Parties
        or
        the Companies. 

       

      6.8  Litigation
        Support.
        In the
        event and for so long as any Buyer Party, any Company is actively contesting
        or
        defending against any Litigation in connection with any fact, situation,
        circumstance, status, condition, activity, practice, plan, occurrence, event,
        incident, action, failure to act or transaction existing or occurring on
        or
        prior to the Closing Date involving any Company, Seller and Guarantor will
        cooperate in the contest or defense, make available their personnel and provide
        such testimony and access to their books and records as may be necessary
        in
        connection with the contest or defense, at the cost and expense of Buyer
        Parties
        (unless and to the extent any Buyer Party is entitled to indemnification
        therefor under Article X or Article XI).

       

      6.9  Nondisparagement.
        Neither
        Seller nor Guarantor, nor any of their respective Affiliates, will take any
        action that is designed or intended to have the effect of discouraging any
        lessor, licensor, vendor, supplier or other business associate of any Company
        from maintaining the same business relationship with the Companies after
        the
        Closing as it maintained with the Companies prior to the Closing. Seller
        and
        Guarantor will refer all inquiries relating to the business of the Companies
        to
        Buyer Parties from and after the Closing.

       

      
        
          
          

        

        
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      6.10  Confidentiality.

       

      (a)  Seller,
        Guarantor and their respective Affiliates will keep confidential and protect,
        and will not divulge, allow access to or use in any way, (i) Intellectual
        Property Rights, including product specifications, formulae, compositions,
        processes, designs, sketches, photographs, graphs, drawings, samples, inventions
        and ideas, past, current and planned research and development, current and
        planned manufacturing and distribution methods and processes, market studies,
        business plans, Software, database technologies, systems, structures,
        architectures and data (and related processes, formulae, compositions,
        improvements, devices, know-how, inventions, discoveries, concepts, ideas,
        designs, methods and information), (ii) any and all information concerning
        the
        business and affairs (including historical financial statements, financial
        projections and budgets, historical and projected sales, capital spending
        budgets and plans, the names and backgrounds of key personnel, personnel
        training and techniques and materials), however documented, and (iii) any
        and
        all notes, analyses, compilations, studies, summaries and other material
        containing or based, in whole or in part, on any information included in
        the
        foregoing (“Confidential
        Information”)
        of any
        Company, unless required by Laws, Governmental Orders, policies, or rules
        of
        stock exchanges on which the shares of Guarantor are listed, in which event,
        if
        legally permissible, Seller or Guarantor shall promptly provide written notice
        to Buyer Parties to allow Buyer Parties or any Company to seek (and if only
        Seller or Guarantor is legally permitted to seek, they will, if requested
        by
        Buyer Parties seek) (at the expense of Buyer Parties or any Company) a
        protective order with respect to such information. Seller
        and Guarantor acknowledge that such Confidential Information constitutes
        a
        unique and valuable asset of each Company and represents a substantial
        investment of time and expense by such Company, and that any disclosure or
        other
        use of such Confidential Information other than for the sole benefit of such
        Company would be wrongful and would cause irreparable harm to such Company.
        Seller and Guarantor will deliver promptly to Buyer Parties or destroy, at
        the
        request and option of Buyer Parties, all tangible and intangible embodiments
        (and all copies) of such Confidential Information that are in the possession
        of
        Seller, Guarantor or their respective Affiliates, provided that such request
        of
        Buyer Parties may only relate to embodiments that are ten (10) years or older
        from the date of request. The foregoing obligations of confidentiality will
        not
        apply to any Confidential Information that is or subsequently becomes generally
        publicly known, other than as a direct or indirect result of the breach of
        this
        Agreement by Seller or Guarantor.

       

      (b)  Seller
        and Guarantor acknowledge that Buyer Parties have required that Seller and
        Guarantor make the agreements in this Section 6.10
        as a
        condition to Buyer’s purchase of the Florida Canyon Shares, the Standard Shares
        and the Exploration Shares and consummation of the transactions contemplated
        by
        this Agreement. Seller and Guarantor agree that the agreements contained
        in this
        Section 6.10
        are
        reasonable and necessary to protect the legitimate interests of Buyer Parties
        and that any violation or breach of this Section 6.10
        will
        result in irreparable injury to Buyer Parties for which no adequate remedy
        would
        exist at law. Accordingly, in addition to any relief at law that may be
        available to any Buyer Party for such violation or breach and regardless
        of any
        other provision contained in this Agreement, each Buyer Party will be entitled
        to injunctive and other equitable relief restraining such violation or breach
        (without any requirement that any Buyer Party provide any bond or other
        security).

       

      
        
          
          

        

        
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      (c)  In
        the
        event that Seller or Guarantor is requested or required (by oral question
        or
        request for information or documents in any legal proceeding, interrogatory,
        subpoena, civil investigative demand or similar process) to disclose any
        Confidential Information, it will notify Buyer Parties promptly of the request
        or requirement so that Buyer Parties may seek an appropriate protective order
        or
        waive compliance with the provisions of this Section 6.10.
        If, in
        the absence of a protective order or the receipt of a waiver from Buyer Parties,
        Seller or Guarantor is, on the advice of counsel, compelled to disclose any
        Confidential Information to any tribunal or else stand liable for contempt,
        Seller or Guarantor may disclose the Confidential Information to the tribunal;
        provided,
        however,
        that
        the disclosing Seller or Guarantor will use its reasonable efforts to obtain,
        at
        the request of any Buyer Party, an order or other assurance that confidential
        treatment will be accorded to such portion of the Confidential Information
        required to be disclosed as the Buyer Party designates.

       

      6.11  Assignment
        of Confidentiality Agreements.Effective
        upon the Closing, Seller and Guarantor will assign to each Company all of
        Seller’s and Guarantor’s right, title and interest in and to any confidentiality
        agreement (but only to the extent any such agreement may by its terms be
        assigned to a third party) to which Seller or Guarantor or the agent of Seller
        or Guarantor may be a party pertaining to the confidentiality of information
        relating to such Company or the hiring of employees of such Company. Seller
        and
        Guarantor will request the return or destruction of information covered by
        any
        such agreement (regardless of whether such agreement is assignable) within
        two
        business days of the date of this Agreement to the broadest extent permitted
        by
        such confidentiality agreement.

       

      6.12  Transfer
        of Apollo Gold Exploration Property.
        Prior
        to Closing, Seller will execute, deliver and file for recording in the office
        of
        the Pershing County, Nevada, Recorder an instrument or instruments of grant,
        transfer, and assignment (a) conveying to Exploration all right, title and
        interest in and to the mining claims and leases listed on Part 1 of Schedule
        6.12
        and (b)
        conveying to Standard all right, title and interest in and to the Fee Property
        listed on Part 2 of Schedule
        6.12
        (the
“Exploration
        Property Transfers”).
        With
        respect to any unpatented mining claims owned by Seller and conveyed to
        Exploration, Seller shall also prior to the Closing file a notice of transfer
        of
        interest with the Nevada State Office of the Bureau of Land Management.

       

      6.13  Employee
        Matters.
        If
        prior to Closing, any Person holding the position of general manager of the
        mine, or any position reporting directly to the general manager of the mine,
        resigns, provides notice of resignation, or is terminated, Seller and Guarantor
        will use their reasonable efforts to cause substitutes acceptable to Buyer
        Parties and Seller to be hired and to commence employment on or prior to
        the
        Closing Date on terms acceptable to Buyer Parties and Seller.

       

      6.14  Claims
        Against Company Personnel.
        On and
        after the Closing Date, Seller and Guarantor will not, and will cause their
        Affiliates not to, make any claim or take any other action that would cause
        any
        Person to be entitled to be indemnified by any Company, or to receive expenses
        from any Company, under any Indemnification Agreement or under the certificate
        of incorporation or bylaws of any Company with respect to any event or matter
        that occurs prior to the Closing.

       

      
        
          
          

        

        
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      6.15  No
        Shareholder Approval.
        Seller
        and Guarantor will not, and will cause their Affiliates not to, take any
        action
        that would cause the approval of Guarantor’s shareholders to be required in
        order to consummate the transactions contemplated herein.

       

      VII.
          Further
        Agreements

       

      7.1  Conditions.
        Buyer
        Parties will not take any action that would render, or that reasonably may
        be
        expected to render, any representation or warranty made by Buyer Parties
        in this
        Agreement untrue at the Closing as though then made and as though the Closing
        Date had been substituted for the date of this Agreement in such representation
        or warranty. Buyer Parties will use their reasonable efforts to cause the
        conditions set forth in Section 8.2
        to be
        satisfied and to consummate the transactions contemplated by this Agreement
        as
        soon as reasonably possible and in any event prior to the Closing
        Date.

       

      7.2  Buyer
        Permitted Updates.
        Buyer
        Parties will promptly notify Seller or Guarantor in writing if Buyer Parties
        should discover that any representation or warranty made by Buyer Parties
        in
        this Agreement was when made, has subsequently become or will be on the Closing
        Date untrue in any respect. No disclosure pursuant to this Section 7.2
        will be
        deemed to cure any inaccuracy, misrepresentation, breach of warranty or breach
        of agreement, unless:

       

      (a)  the
        disclosure is made in writing at least five calendar days prior to the earlier
        of the Closing Date or December 1, 2005;

       

      (b)  the
        disclosure is identified by Buyer Parties as an exception to a specific
        representation or warranty set forth in Article V;

       

      (c)  the
        disclosure contains the same level of detail as would have been required
        to be
        included in the Disclosure Schedule on the date of this Agreement, had such
        fact
        or matter been an exception to Seller’s and Guarantor’s representations or
        warranties;

       

      (d)  no
        officer of Parent had actual knowledge of such fact or matter on or prior
        to the
        date of this Agreement or would have acquired any knowledge upon reasonable
        inquiry and investigation; and

       

      (e)  the
        fact
        or matter did not result from any willful or intentional failure to disclose
        by
        Buyer Parties or any Affiliate thereof (a disclosure that satisfies all such
        requirements, a “Buyer
        Permitted Update”).

       

      7.3  Employment;
        Employee Benefits.
        Employees of each Company will continue as employees on the Closing Date,
        subject to the right to terminate the employment of such employees in accordance
        with law. In addition, each party agrees to the terms and conditions set
        forth
        on Schedule
        7.3
        with
        respect to certain employment and employee benefits matters.

       

      7.4  Insurance.
        Buyer
        Parties will use their reasonable efforts to secure and obtain, on or prior
        to
        the Closing Date, insurance applicable to the Companies and their business,
        to
        be effective commencing on the Closing Date, on commercially reasonable terms,
        that is sufficient for compliance with all requirements of applicable Law
        and of
        any Material Contract to which any Company is subject and that insures against
        risks of the kind and in amounts for which the Companies were insured prior
        to
        Closing (the “Required
        Insurance”).
        Seller and Guarantor will use reasonable efforts to assist Buyer Parties
        in
        obtaining the Required Insurance.

       

      
        
          
          

        

        
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      7.5  Bonding.
        Buyer
        Parties will use their reasonable efforts to obtain, on or prior to the Closing
        Date, assurances acceptable to each of the Buyer Parties, Seller and Guarantor,
        in their reasonable discretion, that the Companies’ existing reclamation bonds
        and other surety, which are listed on Schedule
        7.5,
        will
        remain in full force and effect (at no post-Closing cost to Seller and
        Guarantor) after the Closing or will be replaced, effective as of the Closing
        Date, on terms acceptable to each of the Buyer Parties, in their reasonable
        discretion, and to the appropriate Governmental Entities (such bonds or surety,
        as so continued or replaced, the “Required
        Surety”).
        Seller and Guarantor will use reasonable efforts to assist Buyer Parties
        in
        obtaining the Required Surety.

       

      7.6  Releases
        from Guarantees.
        Buyer
        Parties will use their reasonable efforts to obtain, on or prior to the Closing
        Date, evidence acceptable to Seller and Guarantor in their sole discretion
        that
        effective on the Closing Date, Seller and Guarantor shall be released from
        their
        obligations under all of the guarantees of the Companies’ obligations to which
        either Seller or Guarantor are a party, as listed on Schedule 7.6
        (the
“Required
        Releases”).
        Seller
        and Guarantor will use reasonable efforts to assist the Buyer Parties in
        obtaining the Required Releases.

       

      7.7  Non-Hire.
        

       

      (a)  Except
        with Buyer’s consent, such consent not to be unreasonably withheld or delayed,
        during the period that commences on the date of this Agreement and ends on
        the
        first anniversary of the Closing Date, Seller and Guarantor will not, and
        will
        cause each of their Affiliates not to, employ (or attempt to employ or interfere
        with any employment relationship with) any employee of any Company.

       

      (b)  Except
        with Seller’s or Guarantor’s consent, such consent not to be unreasonably
        withheld or delayed, during the period that commences on the date of this
        Agreement and ends on the first anniversary of the Closing Date, Buyer Parties
        will not, and will cause each of their Affiliates not to, employ (or attempt
        to
        employ or interfere with any employment relationship with) any employee of
        Seller, Guarantor or any Affiliate thereof.

       

      7.8  Use
        of
        Seller’s and Guarantor’s Names.
        As soon
        as practicable after the Closing but in no event later than 30 days after
        the
        Closing, Buyer Parties shall remove or cause to be removed the names, marks
        and
        identifications used by the Companies and all variations and derivatives
        thereof
        and logos relating thereto from all of the Companies’ assets, including, without
        limitation, all documentation or records prepared after the Closing Date,
        to the
        extent they include the word “Apollo Gold” or “Apollo,” including, without
        limitation, Apollo Gold Exploration. At no time shall Buyer Parties utilize
        any
        of the foregoing names or any other tradename or trademark of the Seller
        or
        Guarantor in connection with their ownership and operation of the
        Companies.

       

      7.9  Post-Closing
        Access.
        After
        the Closing Date, Buyer Parties will cause each Company to afford to Seller
        and
        Guarantor, their accountants and counsel, during normal business hours, upon
        reasonable request, full access to the books and records of the Companies
        in
        order that Seller and Guarantor have a full opportunity to make such
        investigation and evaluation as they reasonably desire to review, prepare
        and
        audit financial statements of or related to each Company or the Seller or
        Guarantor for periods prior to the Closing Date. Buyer Parties will cause
        each
        Company to retain all financial statements and records, including, but not
        limited to, all records related to Taxes for a period of seven (7) years
        from
        the Closing Date.

       

      
        
          
          

        

        
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      7.10  Filings;
        Other Action.
        Subject
        to the terms and conditions herein provided, the Buyer Parties, Seller and
        Guarantor shall and shall cause any appropriate other party to: (a) use all
        reasonable efforts to cooperate with one another in (i) determining which
        filings are required to be made prior to the Closing with, and which consents,
        approvals, permits, or authorizations are required to be obtained prior to
        the
        Closing from, any Governmental Entity, in connection with the execution and
        delivery of this Agreement and the consummation of the transactions contemplated
        hereby, and (ii) timely making all such filings and timely seeking all such
        consents, approvals, permits, or authorizations; and (b) use all reasonable
        efforts to take, or cause to be taken, all other action and do, or cause
        to be
        done, all other things necessary, proper, or appropriate to consummate and
        make
        effective the transactions contemplated by this Agreement.

       

      7.11  APO
        19.
        The
        parties acknowledge that Florida Canyon has applied for Bureau of Land
        Management (BLM) approval of Amended Plan of Operations no. 19 (APO 19),
        the
        approval of which could, but is not guaranteed to, reduce Florida Canyon's
        ultimate reclamation liability. Buyer Parties acknowledge that (i) the BLM
        Winnemucca Field Office personnel have informed Florida Canyon's staff verbally
        that their review and approval of APO 19 must await the execution of a Long
        Term
        Care Agreement and Irrevocable Trust, as provided in prior correspondence
        with
        the BLM concerning prior amendments to the Plan of Operations, (ii) the BLM
        is
        currently reviewing a draft of the agreement creating the trust account,
        (iii)
        approximately $300,000 of the funds to be placed in the trust for long term
        care
        are being held by the BLM until these agreements are complete and fully
        executed, and (iv) an additional $140,000-$150,000 will need to be paid into
        the
        trust by Florida Canyon at the time of execution of the trust agreement.
        

       

      7.12  Standard
        Leach Pad Leak.
        Prior
        to the Closing Date, Seller and Guarantor will, and will cause the Companies
        to,
        use their reasonable efforts to locate and repair, if possible, and mitigate,
        in
        the manner described in Schedule
        7.12,
        the
        Standard mine leach pad leak disclosed as Item 4 in Schedule
        4.17(f).
        

       

      VIII.
          Conditions
        to Closing

       

      8.1  Conditions
        to Buyer’s Obligations.
        The
        obligation of Buyer to take the actions required to be taken by it at the
        Closing is subject to the satisfaction or waiver, in whole or in part, in
        Buyer’s sole discretion (but any waiver under Section 8.1(a)
        will
        only waive Buyer Parties’ rights of indemnification under this Agreement with
        respect to the portion of any Loss that exceeds 2.5% of the Purchase Price),
        of
        each of the following conditions at or prior to the Closing:

       

      
        
          
          

        

        
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      (a)  The
        representations and warranties set forth in Articles III and IV that are
        not
        subject to materiality or Material Adverse Effect qualifications will be
        true
        and correct in all material respects at and as of the Closing Date as though
        then made and as though the Closing Date had been substituted for the date
        of
        this Agreement in such representations and warranties, except that any
        representation or warranty expressly made as of a specified date will only
        need
        to have been true on and as of such date, and the representations and warranties
        set forth in Articles III and IV that are subject to materiality or Material
        Adverse Effect qualifications will be true and correct in all respects at
        and as
        of the Closing Date as though then made and as though the Closing Date had
        been
        substituted for the date of this Agreement in such representations and
        warranties, except that any representation or warranty expressly made as
        of a
        specified date will only need to have been true on and as of such date (without
        taking into account any supplemental disclosures after the date of this
        Agreement by Seller, Guarantor or any Company, except for the Seller Permitted
        Updates, if any);

       

      (b)  Seller
        and Guarantor will have performed and complied with each of their agreements
        contained in this Agreement in all material respects;

       

      (c)  The
        Required Insurance, Required Surety and Required Releases will have been
        obtained and be in full force and effect and such actions as Buyer Parties’
        counsel may reasonably require will have been taken in connection
        therewith;

       

      (d)  Buyer
        Parties will have obtained each Governmental Authorization required to operate
        the business of the Companies in substantially the same manner and no less
        favorable than it was operated prior to the Closing Date;

       

      (e)  Buyer
        Parties will have received evidence reasonably satisfactory to them that
        no
        Litigation is pending or threatened (i) challenging or seeking to prevent
        or
        delay consummation of any of the transactions contemplated by this Agreement,
        (ii) asserting the illegality of or seeking to render unenforceable any material
        provision of this Agreement, the Transition Services Agreement, the Subscription
        Agreement, the Registration Rights Agreement or the Further Subscription
        Documents, (iii) seeking to prohibit direct or indirect ownership, combination
        or operation by Buyer Parties of any portion of the business or assets of
        any
        Company, or to compel any Buyer Party or any Company to dispose of, or to
        hold
        separately, or to make any change in any portion of the business or assets
        of
        any Buyer Party or of any Company, as a result of the transactions contemplated
        by this Agreement, or incur any burden, (iv) seeking to require direct or
        indirect transfer or sale by any Buyer Party of, or to impose material
        limitations on the ability of any Buyer Party to exercise full rights of
        ownership of, any of the Florida Canyon Shares, Standard Shares or Exploration
        Shares or (v) imposing or seeking to impose material damages or sanctions
        directly arising out of the transactions contemplated by this Agreement on
        any
        Buyer Party or any Company or any of their respective officers or
        directors;

       

      (f)  No
        Law or
        Governmental Order will have been enacted, entered, enforced, promulgated,
        issued or deemed applicable to the transactions contemplated by this Agreement
        by any Governmental Entity that would reasonably be expected to result, directly
        or indirectly, in any of the consequences referred to in Section 8.1(e);

       

      
        
          
          

        

        
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      (g)  After
        the
        date of this Agreement, no Material Adverse Effect
        will
        have occurred;

       

      (h)  No
        Person
        will have asserted or threatened that, other than as set forth in the Disclosure
        Schedule, such Person (i) is the owner of, or has the right to acquire or
        to
        obtain ownership of, any capital stock of, or any other voting, equity or
        ownership interest in, any Company or (ii) is entitled to all or any portion
        of
        the Purchase Price; 

       

      (i)  Buyer
        Parties will not have discovered any fact or circumstance existing as of
        the
        date of this Agreement not disclosed on the Disclosure Schedule that has
        a
        Material Adverse Effect;

       

      (j)  The
        Seller will have delivered each of the agreements, certificates, instruments
        and
        other documents that it is obligated to deliver pursuant to Section 2.4(b)(i),
        and
        such agreements so delivered will be in full force and effect;

       

      (k)  None
        of
        the Companies will have been, or threatened to be, materially adversely affected
        in any way as a result of fire, explosion, disaster, accident, labor dispute,
        any action by any Governmental Entity, flood, act of war, terrorism, civil
        disturbance or act of nature;

       

      (l)  The
        Companies shall be appropriately staffed, consistent with the level of staffing
        in place on the date of this Agreement;

       

      (m)  Buyer
        Parties will have received reasonably satisfactory evidence of the execution
        and
        delivery to Seller or Guarantor of releases of all Encumbrances listed on
        Schedule
        8.1(m),
        and
        there shall be no other Encumbrances on the Real Property, other than Permitted
        Encumbrances and Encumbrances listed on Schedule
        4.9;

       

      (n)  Buyer
        Parties will have received certificates dated as of a date not earlier than
        the
        third Business Day prior to the Closing as to the good standing of each Company,
        executed by the appropriate officials of the State of Delaware, the State
        of
        Nevada and each other jurisdiction in which such Company is licensed or
        qualified to do business as a foreign corporation as specified in Schedule
        4.1;
        

       

      (o)  Buyer
        Parties will have received an estoppel certificate from Muller Investments
        on
        terms acceptable to Buyer Parties, in their sole discretion;

       

      (p)  Seller
        and Guarantor shall have caused the restricted certificate of deposit listed
        on
        the March Balance Sheet for Florida Canyon, or the benefit thereof, to be
        transferred or assigned to Florida Canyon, and provided Buyer Parties with
        evidence satisfactory to Buyer Parties to such effect;

       

      (q)  Seller
        will have executed, delivered and recorded the Exploration Property
        Transfers;

       

      
        
          
          

        

        
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      (r)  Buyer
        Parties will have received an audited balance sheet as of March 31, 2005
        of each
        Company (the “Audited
        Balance Sheets”),
        prepared in accordance with GAAP applied on a basis consistent with the
        preparation of the March Financial Statements, except that the Audited Balance
        Sheets need not contain footnotes.
        Buyer
        Parties shall reimburse Seller at the Closing for the costs and fees incurred
        by
        Seller or Guarantor in connection with the preparation of the Audited Balance
        Sheets; and

       

      (s)  Each
        Indemnification Agreement that includes, as a party thereto, any Person that
        is
        an employee, officer or director of Guarantor or any of its Subsidiaries
        as of
        the date of this Agreement shall have been amended to provide that the Companies
        have no further obligations under such Indemnification Agreement and are
        no
        longer parties thereto.

       

      8.2  Conditions
        to Seller’s Obligations.
        The
        obligation of Seller to take the actions required to be taken by it at the
        Closing is subject to the satisfaction or waiver, in whole or in part, in
        Seller’s discretion, of each of the following conditions at or prior to the
        Closing:

       

      (a)  The
        representations and warranties set forth in Article V that are not subject
        to
        materiality qualifications will be true and correct in all material respects
        at
        and as of the Closing Date as though then made and as though the Closing
        Date
        had been substituted for the date of this Agreement in such representations
        and
        warranties, except that any representation or warranty expressly made as
        of a
        specified date will only need to have been true on and as of such date, and
        the
        representations and warranties set forth in Article V that are subject to
        materiality qualifications will be true and correct in all respects at and
        as of
        the Closing Date as though then made and as though the Closing Date had been
        substituted for the date of this Agreement in such representations and
        warranties, except that any representation or warranty expressly made as
        of a
        specified date will only need to have been true on and as of such date (without
        taking into account any supplemental disclosures after the date of this
        Agreement by any Buyer Party, except for the Buyer Permitted Updates, if
        any);

       

      (b)  Buyer
        Parties will have performed and complied with each of their agreements contained
        in this Agreement in all material respects;

       

      (c)  The
        Required Insurance, Required Surety and Required Releases will have been
        obtained and be in full force and effect and such actions as Seller and
        Guarantor’s counsel may reasonably require will have been taken in connection
        therewith; 

       

      (d)  No
        Law or
        Governmental Order will have been enacted, entered, enforced, promulgated,
        issued or deemed applicable to the transactions contemplated by this Agreement
        by any Governmental Entity that prohibits the Closing;

       

      (e)  Seller
        and Guarantor will have received evidence reasonably satisfactory to them
        that
        no Litigation is pending or threatened (i) challenging or seeking to prevent
        or
        delay consummation of any of the transactions contemplated by this Agreement,
        (ii) asserting the illegality of or seeking to render unenforceable any material
        provision of this Agreement or the Transition Services Agreement, (iii) seeking
        to prohibit direct or indirect ownership, combination or operation by Buyer
        Parties of any portion of the business or assets of any Company, or (iv)
        imposing or seeking to impose material damages or sanctions directly arising
        out
        of the transactions contemplated by this Agreement on Seller, Guarantor or
        any
        Company or any of their respective officers or directors;

       

      
        
          
          

        

        
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      (f)  Buyer
        Parties shall have received all Governmental Authorizations necessary for
        each
        of them to consummate all of the transactions contemplated by this Agreement;
        and 

       

      (g)  Buyer
        will have delivered each of the certificates, instruments and other documents
        that it is obligated to deliver pursuant to Section 2.4(b)(ii).

       

      IX.
          Termination

       

      9.1  Termination.
        This
        Agreement may be terminated prior to the Closing:

       

      (a)  by
        the
        mutual written consent of Buyer Parties, Seller and Guarantor;

       

      (b)  by
        Seller
        and Guarantor,
        if

       

      (i)  Buyer
        Parties deliver a Buyer Permitted Update disclosing any fact or matter that,
        if
        not disclosed in such Buyer Permitted Update, would have constituted a breach
        of
        any representation or warranty of Buyer Parties contained in this Agreement
        in
        any material respect;

       

      (ii)  Buyer
        Parties have or will have breached any representation, warranty or agreement
        contained in this Agreement in any material respect; provided, however, that,
        if
        such breach is curable by Buyer Parties through the exercise of their reasonable
        efforts and Buyer Parties continue to exercise such reasonable efforts, Seller
        and Guarantor may not terminate this Agreement under this Section 9.1(b)(ii)
        unless
        such breach is not cured in a manner satisfactory to Seller and Guarantor
        in
        their reasonable discretion within the Buyer Cure Period. The “Buyer Cure
        Period” shall mean the period beginning on the date on which Seller and
        Guarantor deliver to Buyer Parties written notice setting forth in reasonable
        detail the circumstances giving rise to such breach and ending on the earlier
        of
        the 30th
        day
        thereafter, or December 1, 2005;

       

      (iii)  the
        transactions contemplated by this Agreement will not have been consummated
        on or
        before December 1, 2005; provided,
        that
        Seller and Guarantor will not be entitled to terminate this Agreement pursuant
        to this Section 9.1(b)(iii)
        if
        Seller’s and Guarantor’s failure to comply fully with their obligations under
        this Agreement has prevented the consummation of the transactions contemplated
        by
        this
        Agreement;

       

      (iv)  a
        Law or
        Governmental Order will have been enacted, entered, enforced, promulgated,
        issued or deemed applicable to the transactions contemplated by this Agreement
        by any Governmental Entity that prohibits the Closing; or

       

      
        
          
          

        

        
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      (v)  any
        of
        the conditions set forth in Section 8.2
        will
        have become impossible to satisfy;

       

      (c)  by
        Buyer
        Parties,
        if

       

      (i)  Seller
        or
        Guarantor deliver a Seller Permitted Update disclosing any fact or matter
        that,
        if not disclosed in such Seller Permitted Update, would have constituted
        a
        breach of any Seller or Guarantor representation or warranty contained in
        this
        Agreement in any material respect;

       

      (ii)  Seller
        or
        Guarantor has or will have breached any representation, warranty or agreement
        contained in this Agreement in any material respect; provided, however, that,
        if
        such breach is curable by Seller or Guarantor through the exercise of its
        reasonable efforts and Seller or Guarantor continues to exercise such reasonable
        efforts, Buyer Parties may not terminate this Agreement under this Section
        9.1(c)(ii)
        unless
        such breach is not cured in a manner satisfactory to Buyer Parties in their
        reasonable discretion within the Seller Cure Period. The “Seller Cure Period”
        shall mean the date on which Buyer Parties deliver to Seller or Guarantor
        written notice setting forth in reasonable detail the circumstances giving
        rise
        to such breach the period beginning on and ending on the earlier to occur
        of the
        30th
        day
        thereafter or December 1, 2005;

       

      (iii)  the
        transactions contemplated by this Agreement will not have been consummated
        on or
        before December 1, 2005; provided,
        that
        Buyer Parties will not be entitled to terminate this Agreement pursuant to
        this
        Section 9.1(c)(iii)
        if any
        Buyer Party’s failure to comply fully with its obligations under this Agreement
        has prevented the consummation of the transactions contemplated by this
        Agreement;

       

      (iv)  a
        Law or
        Governmental Order will have been enacted, entered, enforced, promulgated,
        issued or deemed applicable to the transactions contemplated by this Agreement
        by any Governmental Entity that would reasonably be expected to result directly
        or indirectly, in any of the consequences referred to in Section 8.1(e);

       

      (v)  after
        the
        date of this Agreement, a Material Adverse Effect will have occurred;

       

      (vi)  any
        of
        the conditions set forth in Section 8.1
        will
        have become impossible to satisfy;

       

      (vii)  any
        Buyer
        Party will have discovered any fact or circumstance existing as of the date
        of
        this Agreement that has not been previously disclosed on the Disclosure Schedule
        that has a Material Adverse Effect;

       

      
        
          
          

        

        
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      (viii)  Buyer
        Parties make a decision to terminate this Agreement pursuant to
        Section 2.3;
        or

       

      (ix)  any
        Company will have been, or will have been threatened to be, materially adversely
        affected in any way as a result of fire, explosion, disaster, accident, labor
        dispute, any action by any Governmental Entity, flood, act of war, terrorism,
        civil disturbance or act of nature.

       

      9.2  Effect
        of Termination.

       

      (a)  If
        Seller
        and Guarantor terminate this Agreement pursuant to Section 9.1(b)(i),
        such
        termination shall be the exclusive remedy of Seller and Guarantor with respect
        to any fact or matter disclosed on the Buyer Permitted Update preceding such
        termination, absent fraud or willful misconduct by a Buyer Party.

       

      (b)  If
        Buyer
        Parties terminate this Agreement pursuant to Section 9.1(c)(i),
        such
        termination shall be the exclusive remedy of Buyer Parties with respect to
        any
        fact or matter disclosed on the Seller Permitted Update preceding such
        termination, absent fraud or willful misconduct by Seller or
        Guarantor.

       

      (c)  If
        Buyer
        Parties terminate this Agreement pursuant to Section 9.1(c)(ii),
        Seller
        and Guarantor shall, within 10 calendar days thereafter, reimburse Buyer
        Parties
        for Buyer Parties’ reasonable documented out-of-pocket expenses in connection
        with the transactions contemplated by this Agreement, up to an aggregate
        of
2.5%
        of
        the Purchase Price, which payment shall be the exclusive remedy of Buyer
        Parties
        with respect to such termination, absent fraud or willful misconduct by Seller
        or Guarantor.

       

      (d)  If
        Buyer
        Parties terminate this Agreement pursuant to Section 9.1(c)(viii),
        such termination shall be the exclusive remedy of Buyer Parties under this
        Agreement, absent fraud or willful misconduct by Seller or
        Guarantor.

       

      (e)  Except
        as
        provided in Sections 9.2(a),
        9.2(b),
        9.2(c)
        and
9.2(d),
        the
        right of termination under Section 9.1
        is in
        addition to any other rights Buyer Parties or Seller may have under this
        Agreement or otherwise, and the exercise of a right of termination will not
        be
        an election of remedies and will not preclude an action for breach of this
        Agreement. If this Agreement is terminated, all continuing obligations of
        the
        parties under this Agreement will terminate except that Section 9.2(c),
        Article
        XII, the Confidentiality Agreement and the Promissory Note will survive
        indefinitely unless sooner terminated or modified by the parties in writing.
        

       

      X.
          Indemnification

       

      10.1  Indemnification
        by Seller
        and
        Guarantor.

       

      (a)  Seller
        and Guarantor will, jointly and severally, indemnify in full each of Buyer,
        Parent, the Companies (collectively, for purposes of this Section 10.1
        only,
“Buyer”)
        and
        hold it harmless against any Loss, whether or not actually incurred prior
        to the
        applicable date referred to in Section 10.1(d),
        arising
        from, relating to or constituting (i) any breach or inaccuracy in any of
        the
        representations and warranties of Seller and Guarantor contained in this
        Agreement or in the Disclosure Schedule (as modified by any Seller Permitted
        Updates) as the same may be brought down to the Closing Date or any closing
        certificate delivered by or on behalf of Seller or Guarantor pursuant to
        this
        Agreement (the calculation of Loss resulting from any such breach or inaccuracy
        to be determined without regard to any qualification for “materially”, “in all
        material respects” or similar qualification), (ii) failure of Seller or
        Guarantor to assume, pay and discharge the obligations of the Companies pursuant
        to Section 6.4(a),
        (iii)
        any liability under the WARN Act or any similar state or local Law that may
        result from an “Employment
        Loss,”
        as
        defined by 29 U.S.C. 2101(a)(6), caused by any action of any Company prior
        to
        the Closing; (iv) any Plan established or maintained by any Company
        prior
        to the Closing Date, Seller or Guarantor; (v) any Litigation instituted by
        Loretta Apodaca; (vi) any claim arising under any of the Indemnification
        Agreements; (vii) the circumstances described on Schedule
        4.19(c);
        (viii)
        the matters described in Schedule
        4.14
        under
        subheadings A.2 and A.3, (ix) any unenforceability of the D&O Letters, (x)
        the Standard mine leach pad leak disclosed as Item 4 in Schedule
        4.17(f),
        up
        to a
        maximum of $500,000, or (xi) any
        breach of any of the agreements or covenants of Seller or Guarantor contained
        in
        this Agreement (collectively, “Buyer
        Losses”).

       

      
        
          
          

        

        
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      (b)  Seller
        and Guarantor will indemnify Buyer for Buyer Losses arising pursuant to
        Section 10.1(a)
        only if
        the aggregate amount of all Buyer Losses attributable to
        Section 10.1(a)
        exceeds
        $200,000 (the “Basket
        Amount”),
        in
        which case Seller will be liable for the aggregate amount of all Buyer
        Losses
        (provided that the foregoing limitation
        shall
        not apply to any Loss arising from Litigation instituted by Loretta Apodaca,
        any
        claim arising under any of the Indemnification Agreements, any unenforceability
        of the D&O Letters or the circumstances described on Schedule
        4.19(c),
        and the
        Standard mine leach pad leak disclosed as Item 4 in Schedule
        4.17(f)).

       

      (c)  Seller
        and Guarantor’s collective liability will not exceed the Purchase Price
for
        Buyer
        Losses arising pursuant to Section 10.1(a)
        or any
        Loss arising pursuant to Section 10.3(a).

       

      (d)  If
        Buyer
        has a claim for indemnification under this Section 10.1,
        Buyer
        must deliver to Seller or Guarantor one or more written notices of Buyer
        Losses
        (each a “Buyer
        Claim”)
        within
        twenty-two (22) months after the Closing Date, except for Buyer Losses (i)
        arising from a breach or inaccuracy in the representations and warranties
        made
        in Section 4.17,
        for
        which Buyer must deliver a Buyer Claim prior to the second anniversary of
        the
        Closing Date, or (ii) arising from a breach or inaccuracy in the representations
        and warranties made in Section 3.1
        or
        Section 4.11,
        any
        Loss arising from any Litigation instituted by Loretta Apodaca, any Loss
        arising
        from any claim arising under any of the Indemnification Agreements, any Loss
        arising from the matters described in Schedule
        4.14
        under
        subheadings A.2 and A.3 or any breach of any of the agreements by Seller
        or
        Guarantor contained in this Agreement, for which Buyer must deliver a Buyer
        Claim prior to two months after the expiration of the applicable statute
        of
        limitations. Seller and Guarantor will have no liability under this Section
        10.1
        unless
        the written notices required by the preceding sentence are given by the date
        specified. Any Buyer Claim will state in reasonable detail the basis for
        such
        Buyer Losses to the extent then known by Buyer and the nature of the Buyer
        Loss
        for which indemnification is sought, and it may state the amount of the Buyer
        Loss claimed. If such Buyer Claim (or an amended Buyer Claim) states the
        amount
        of the Buyer Loss claimed and Seller or Guarantor notifies Buyer that Seller
        or
        Guarantor does not dispute the claim described in such notice or fails to
        notify
        Buyer within 20 Business Days after delivery of such notice by Buyer whether
        Seller or Guarantor disputes the claim described in such notice, the Buyer
        Loss
        in the amount specified in Buyer’s notice will be admitted by Seller and
        Guarantor (an “Admitted
        Claim”),
        and
        Seller and Guarantor will pay the amount of such Buyer Loss to Buyer. If
        Seller
        or Guarantor has timely disputed the liability of Seller or Guarantor with
        respect to a Buyer Claim (or an amended Buyer Claim) stating the amount of
        a
        Buyer Loss claimed, Seller and/or Guarantor, as applicable, and Buyer will
        proceed in good faith to negotiate a resolution of such dispute. If a claim
        for
        indemnification has not been resolved within 30 calendar days after delivery
        of
        the Seller’s or Guarantor’s notice, Buyer may seek judicial recourse. If a Buyer
        Claim does not state the amount of the Buyer Loss claimed, such omission
        will
        not preclude Buyer from recovering from Seller or Guarantor the amount of
        the
        Buyer Loss described in such Buyer Claim if any such amount is subsequently
        provided in an amended Buyer Claim (although in that event, Seller and Guarantor
        will have the right to dispute the claim in accordance with the provisions
        of
        this Section 10.1(d)).
        In
        order to assert its right to indemnification under this Article X, Buyer
        will
        not be required to provide any notice except as provided in this Section
        10.1(d).

       

      
        
          
          

        

        
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      (e)  Seller
        and Guarantor will pay the amount of any Buyer Loss to Buyer within 10 Business
        Days following a determination of Seller’s or Guarantor’s liability for and the
        amount of a Buyer Loss (whether such determination is made pursuant to the
        procedures set forth in this Section 10.1,
        by
        agreement between Buyer and Seller or Guarantor, by arbitration award or
        by
        final adjudication).

       

      10.2  Indemnification
        by Buyer
        Parties.

       

      (a)  Buyer
        Parties will, jointly and severally, indemnify in full Seller and Guarantor
        (collectively, for purposes of this Section 10.2
        only,
“Seller”) and hold it harmless against any Loss, whether or not actually
        incurred prior to the date referred to in Section 10.2(d),
        arising
        from, relating to or constituting (i) any breach or inaccuracy in any of
        the
        representations and warranties of Buyer (as modified by any Buyer Permitted
        Updates) contained in this Agreement or in any closing certificate delivered
        by
        or on behalf of Buyer pursuant to this Agreement (the calculation of Loss
        resulting from any such breach or inaccuracy to be determined without regard
        to
        any qualification as to “materiality”, “in all material respects” or similar
        qualification), or (ii) any breach of any of the agreements or covenants
        of
        Buyer contained in this Agreement (“Seller
        Losses”).

       

      (b)  Buyer
        Parties will indemnify Seller for the Seller Losses pursuant to Section
        10.2(a) only
        if
        the aggregate amount of all Seller Losses attributable to Section 10.2(a)
        exceeds
        $200,000 (the “Seller’s
        Basket Amount”),
        in
        which case Buyer will be liable for the aggregate amount of all Seller
        Losses. 

       

      (c)  The
        Buyer
        Parties’ liability will not exceed the Purchase Price for Seller Losses
        attributable to Section 10.2(a)
        or any
        Loss arising pursuant to Section 10.4(a).

       

      (d)  If
        Seller
        has a claim for indemnification under this Section 10.2,
        Seller
        must deliver to Buyer or Parent one or more written notices of Seller Losses
        within twenty-two (22) months after the Closing Date, except for Seller Losses
        arising from any breach of any of the agreements by Buyer Parties contained
        in
        this Agreement, for which Seller must deliver such written notice prior to
        two
        months after the expiration of the applicable statute of limitations. The
        Buyer
        Parties will have no liability under this Section 10.2
        unless
        the written notices required by the preceding sentence are given by the date
        specified. Any written notice will state in reasonable detail the basis for
        such
        Seller Losses to the extent then known by Seller and the nature of Seller
        Losses
        for which indemnification is sought, and it may state the amount of Seller
        Losses claimed. If such written notice (or an amended notice) states the
        amount
        of Seller Losses claimed and either Buyer or Parent notifies Seller that
        the
        Buyer Parties do not dispute the claim described in such notice or fails
        to
        notify Seller within 20 Business Days after delivery of such notice by Seller
        whether the Buyer Parties dispute the claim described in such notice, Seller
        Losses in the amount specified in Seller’s notice will be admitted by the Buyer
        Parties, and either Buyer or Parent will pay the amount of such Seller Losses
        to
        Seller. If the Buyer Parties have timely disputed their liability with respect
        to such claim, Buyer and Seller will proceed in good faith to negotiate a
        resolution of such dispute. If a claim for indemnification has not been resolved
        within 30 calendar days after delivery of Buyer’s notice, the Seller may seek
        judicial recourse. If a written notice does not state the amount of Seller
        Losses claimed, such omission will not preclude Seller from recovering from
        Buyer the amount of Seller Losses with respect to the claim described in
        such
        notice if any such amount is promptly provided once determined (although
        in that
        event, the Buyer Parties will have the right to dispute the claim in accordance
        with the provisions of this Section 10.2(d)).
        In
        order to assert its right to indemnification under this Article X, Seller
        will
        not be required to provide any notice except as provided in this Section
        10.2(d).

       

      
        
          
          

        

        
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      (e)  The
        Buyer
        Parties will pay the amount of any Seller Losses to Seller within 10 Business
        Days following a determination of the Buyer Parties’ liability for and the
        amount of the Seller Losses (whether such determination is made pursuant
        to the
        procedures set forth in this Section 10.2,
        by
        agreement between Seller and Buyer, by arbitration award or by final
        adjudication).

       

      10.3  Third-Party
        Actions
        Against Buyer Parties.

       

      (a)  Seller
        and Guarantor will, jointly and severally, indemnify, defend and hold harmless
        each of Parent, Buyer, the Companies and their officers, directors, employees,
        agents, shareholders and Affiliates (collectively, the “Buyer
        Indemnified Parties”)
        against any Loss (i) for which Seller and Guarantor have agreed to indemnify
        Buyer Parties pursuant to Section 10.1(a)
        or (ii)
        arising out of the actions or inactions of Seller or Guarantor after the
        Closing, in each case arising from any Litigation instituted by any third
        party
        (any such third party action or proceeding being referred to as a “Buyer
        Third-Party Action”).
        A
        Buyer Indemnified Party will give Seller or Guarantor prompt written notice
        of
        the commencement of a Buyer Third-Party Action. The complaint or other papers
        pursuant to which the third party commenced such Buyer Third-Party Action
        will
        be attached to such written notice. The failure to give prompt written notice
        will not affect any Buyer Indemnified Party’s right to indemnification unless
        such failure has materially and adversely affected Seller’s or Guarantor’s
        ability to defend successfully such Buyer Third-Party Action.

       

      (b)  Seller
        and Guarantor will contest and defend such Buyer Third-Party Action on behalf
        of
        any Buyer Indemnified Party that requests that they do so. Notice of the
        intention to so contest and defend will be given by Seller or Guarantor to
        the
        requesting Buyer Indemnified Party within 20 Business Days after the Buyer
        Indemnified Party’s notice of such Buyer Third-Party Action (but, in all events,
        at least five Business Days prior to the date that a response to such Buyer
        Third-Party Action is due to be filed). Such contest and defense will be
        conducted by reputable attorneys retained by Seller or Guarantor. A Buyer
        Indemnified Party will be entitled at any time, at its own cost and expense,
        to
        participate in such contest and defense and to be represented by attorneys
        of
        its own choosing. If the Buyer Indemnified Party elects to participate in
        such
        defense, the Buyer Indemnified Party will cooperate with Seller and Guarantor
        in
        the conduct of such defense. A Buyer Indemnified Party will cooperate with
        Seller and Guarantor to the extent reasonably requested by Seller and Guarantor
        in the contest and defense of such Buyer Third-Party Action, including providing
        reasonable access (upon reasonable notice) to the books, records and employees
        of the Buyer Indemnified Party if relevant to the defense of such Buyer
        Third-Party Action; provided,
        that
        such cooperation will not unduly disrupt the operations of the business of
        the
        Buyer Indemnified Party or cause the Buyer Indemnified Party to waive any
        statutory or common law privileges, breach any confidentiality obligations
        owed
        to third parties or otherwise cause any confidential information of such
        Buyer
        Indemnified Party to become public.

       

      
        
          
          

        

        
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      (c)  If
        any
        Buyer Indemnified Party does not request that Seller contest and defend a
        Buyer
        Third-Party Action, or if after such request Seller and Guarantor do not
        contest
        and defend a Buyer Third-Party Action or if any Buyer Indemnified Party
        reasonably determines that Seller and Guarantor are not adequately representing
        or, because of a conflict of interest, may not adequately represent any
        interests of the Buyer Indemnified Party at any time after requesting Seller
        or
        Guarantor to do so, such Buyer Indemnified Party will be entitled to conduct
        its
        own defense and to be represented by attorneys of its own choosing, all at
        Seller’s and Guarantor’s cost and expense. Seller and Guarantor will pay as
        incurred (no later than 25 days after presentation) the fees and expenses
        of the
        counsel retained by such Buyer Indemnified Party pursuant to this Section
        10.3(c).

       

      (d)  Neither
        a
        Buyer Indemnified Party nor Seller or Guarantor may concede, settle or
        compromise any Buyer Third-Party Action without the consent of the other
        party,
        which consents will not be unreasonably withheld or delayed. Notwithstanding
        the
        foregoing, (i) if a Buyer Third-Party Action seeks the issuance of an
        injunction, the specific election of an obligation or similar remedy or (ii)
        if
        the subject matter of a Buyer Third-Party Action relates to the ongoing business
        of any Buyer Indemnified Party, which Buyer Third-Party Action, if decided
        against any Buyer Indemnified Party, would materially adversely affect the
        ongoing business or reputation of any Buyer Indemnified Party, the Buyer
        Indemnified Party alone will be entitled to settle such Buyer Third-Party
        Action
        in the first instance and, if the Buyer Indemnified Party does not settle
        such
        Buyer Third-Party Action, Seller and Guarantor will then have the right to
        contest and defend (but not settle) such Buyer Third-Party Action.

       

      10.4  Third-Party
        Actions Against Seller
        and
        Guarantor.

       

      (a)  Buyer
        Parties will, jointly and severally, indemnify, defend and hold harmless
        each of
        Seller, Guarantor and their officers, directors, employees, agents, shareholders
        and Affiliates (collectively, the “Seller
        Indemnified Parties”)
        against any Loss (i) for which Buyer Parties have agreed to indemnify Seller
        and
        Guarantor pursuant to Section 10.2(a)
        or (ii)
        arising out of the actions or inactions of the Buyer Parties or the Companies
        after the Closing, in each case arising from any Litigation instituted by
        any
        third party (any such third party action or proceeding being referred to
        as a
“Seller
        Third-Party Action”).
        A
        Seller Indemnified Party will give Buyer prompt written notice of the
        commencement of a Seller Third-Party Action. The complaint or other papers
        pursuant to which the third party commenced such Seller Third-Party Action
        will
        be attached to such written notice. The failure to give prompt written notice
        will not affect any Seller Indemnified Party’s right to indemnification unless
        such failure has materially and adversely affected Buyer’s or Parent’s ability
        to defend successfully such Seller Third-Party Action.

       

      
        
          
          

        

        
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      (b)  Buyer
        and
        Parent will contest and defend such Seller Third-Party Action on behalf of
        any
        Seller Indemnified Party that requests that they do so. Notice of the intention
        to so contest and defend will be given by Buyer or Parent to the requesting
        Seller Indemnified Party within 20 Business Days after the Seller Indemnified
        Party’s notice of such Seller Third-Party Action (but, in all events, at least
        five Business Days prior to the date that a response to such Seller Third-Party
        Action is due to be filed). Such contest and defense will be conducted by
        reputable attorneys retained by Buyer or Parent. A Seller Indemnified Party
        will
        be entitled at any time, at its own cost and expense, to participate in such
        contest and defense and to be represented by attorneys of its own choosing.
        If
        the Seller Indemnified Party elects to participate in such defense, the Seller
        Indemnified Party will cooperate with Buyer and Parent in the conduct of
        such
        defense. A Seller Indemnified Party will cooperate with Buyer and Parent
        to the
        extent reasonably requested by Buyer and Parent in the contest and defense
        of
        such Seller Third-Party Action, including providing reasonable access (upon
        reasonable notice) to the books, records and employees of the Seller Indemnified
        Party if relevant to the defense of such Seller Third-Party Action; provided,
        that
        such cooperation will not unduly disrupt the operations of the business of
        the
        Seller Indemnified Party or cause the Seller Indemnified Party to waive any
        statutory or common law privileges, breach any confidentiality obligations
        owed
        to third parties or otherwise cause any confidential information of such
        Seller
        Indemnified Party to become public.

       

      (c)  If
        any
        Seller Indemnified Party does not request that Buyer contest and defend a
        Seller
        Third-Party Action, or if after such request Buyer and Parent do not contest
        and
        defend a Seller Third-Party Action or if any Seller Indemnified Party reasonably
        determines that Buyer and Parent are not adequately representing or, because
        of
        a conflict of interest, may not adequately represent any interests of the
        Seller
        Indemnified Party at any time after requesting Buyer or Parent to do so,
        such
        Seller Indemnified Party will be entitled to conduct its own defense and
        to be
        represented by attorneys of its own choosing, all at Buyer’s and Parent’s cost
        and expense. Buyer and Parent will pay as incurred (no later than 25 days
        after
        presentation) the fees and expenses of the counsel retained by such Seller
        Indemnified Party pursuant to this Section 10.4(c).

       

      (d)  Neither
        a
        Seller Indemnified Party nor Buyer or Parent may concede, settle or compromise
        any Seller Third-Party Action without the consent of the other party, which
        consents will not be unreasonably withheld or delayed. Notwithstanding the
        foregoing, (i) if a Seller Third-Party Action seeks the issuance of an
        injunction, the specific election of an obligation or similar remedy or (ii)
        if
        the subject matter of a Seller Third-Party Action relates to the ongoing
        business of any Seller Indemnified Party, which Seller Third-Party Action,
        if
        decided against any Seller Indemnified Party, would materially adversely
        affect
        the ongoing business or reputation of any Seller Indemnified Party, the Seller
        Indemnified Party alone will be entitled to settle such Seller Third-Party
        Action in the first instance and, if the Seller Indemnified Party does not
        settle such Seller Third-Party Action, Buyer and Parent will then have the
        right
        to contest and defend (but not settle) such Seller Third-Party
        Action.

       

      
        
          
          

        

        
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      10.5  Sole
        and Exclusive Remedy.
        Prior
        to or in connection with the Closing, the parties will have available to
        them
        all remedies available at law or in equity, including specific performance
        or
        other equitable remedies except as expressly limited elsewhere in this
        Agreement. After the Closing, the rights set forth in Sections 10.1
        and
10.2,
        Article
        XI and, to the extent applicable, Sections 10.3
        and
10.4
        will be
        the exclusive remedy for breach or inaccuracy of any of the representations
        and
        warranties contained in Article III through V of this Agreement and will
        be in
        lieu of contract remedies, but the parties otherwise will have available
        to them
        all other remedies available at law or in equity. Notwithstanding the foregoing,
        nothing in this Agreement will prevent any party from bringing an action
        based
        upon fraud or willful misconduct by the other party in connection with this
        Agreement. In the event such action is brought, the prevailing party’s
        attorneys’ fees and costs will be paid by the nonprevailing party.

       

      10.6  Tax
        Adjustment.
        Any
        payment under this Article X, Section 11.9
        or
        Section 11.10
        will be,
        for Tax purposes, to the extent permitted by Law, an adjustment to the Purchase
        Price. Each such payment shall be calculated on a net after tax basis, taking
        into account (i) any Tax savings actually realized by Buyer in the year of
        receipt of the payment resulting from the payment and (ii) any Tax liability
        actually imposed on Buyer in the year of receipt of the payment resulting
        from
        receipt of the payment.

       

      XI.
          Allocation
        of Taxes; Tax Return

       

      11.1  Allocation
        of Tax Liabilities.

       

      (a)  Seller
        will be responsible for all Taxes of the Companies regardless of when due
        and
        payable, (i) with respect to all Tax periods ending on or prior to the Closing
        Date and (ii) with respect to all Tax periods beginning before the Closing
        Date
        and ending after the Closing Date, but only with respect to the portion of
        such
        period up to and including the Closing Date.

       

      (b)  Buyer
        will be responsible for all Taxes of the Companies, regardless of when due
        and
        payable, (i) with respect to all Tax periods beginning after the Closing
        Date,
        (ii) with respect to all Tax periods beginning before the Closing Date and
        ending after the Closing Date, but only with respect to the portion of such
        period commencing after the Closing Date.

       

      11.2  Tax
        Return.
        

       

      (a)  Seller
        will include the income or loss of the Companies for all Tax periods ending
        on
        or before the Closing Date on Seller’s timely filed income Returns and will file
        all such Returns when due (including extensions). Seller shall include the
        income of the Companies (including any deferred items triggered into income
        by
        Treasury Regulation Section 1.1502-13 and any excess loss account taken into
        income by Treasury Regulation Section 1.1502-19 or comparable provisions
        of
        state and local income Tax regulations) on Seller’s consolidated federal income
        Tax Returns and comparable consolidated or combined state income Tax Returns
        for
        all periods through the Closing Date and pay any federal, state, and local
        income Taxes attributable to such income. Seller will cause to be prepared,
        and
        will cause to be filed when due (including any extensions), all other Returns
        of
        the Companies for all Tax periods ending on or before the Closing Date for
        which
        Return have not been filed as of such date. Where such other Return must
        be
        filed by the Companies, upon the request of Seller, Buyer will cause such
        Return
        to be filed when due (including any extensions). Seller will submit copies
        of
        all such Returns (in the case of consolidated Return, the consolidating portion
        thereof applicable to the Companies) to Buyer at least 30 days prior to the
        due
        date, as it may be extended, for Buyer’s review and approval. Seller will cause
        all such Returns to be accurate and complete in accordance with applicable
        Laws
        and to be prepared on a basis consistent with the Returns filed by or on
        behalf
        of the Companies for the preceding Tax periods. Seller will not elect to
        retain
        any net operating loss carryovers or capital loss carryovers of the
        Companies.

       

      
        
          
          

        

        
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      (b)  Buyer
        will prepare and file when due (including any extensions) all Returns of
        the
        Companies for Tax periods ending after the Closing Date; provided,
        however,
        that
        Seller will have the right to review and approve prior to filing all Returns
        for
        any Tax period that includes the Closing Date or any period prior to the
        Closing
        Date. Buyer will cause all such Returns to be accurate and complete in
        accordance with applicable Laws and to the extent permitted under applicable
        Tax
        law, to be prepared on a basis consistent with the Returns filed by or on
        behalf
        of the Companies for the preceding Tax periods. 

       

      11.3  Income
        and Loss Allocation.
        For
        purposes of this Article XI, in the case of any Taxes that are imposed on
        a
        periodic basis and are payable for a Tax period that includes (but does not
        end
        on) the Closing Date, the portion of such Tax related to the Tax period ending
        on the Closing Date will (i) in the case of Taxes other than Taxes based
        upon or
        related to income, sales, gross receipts, wages, capital expenditures, expenses
        or any similar Tax base, be deemed to be the amount of such Tax for the entire
        period multiplied by a fraction, the numerator of which is the number of
        days in
        the Tax period ending on the Closing Date and the denominator of which is
        the
        number of days in the entire Tax period and (ii) in the case of any Tax based
        upon or related to income, sales, gross receipts, wages, capital expenditures,
        expenses or any similar Tax base, be deemed equal to the amount that would
        be
        payable if the relevant Tax period had ended on the Closing Date. All
        determinations necessary to give effect to the foregoing allocations will
        be
        made in a manner consistent with prior practice of the Companies. 

       

      11.4  Cooperation.
        After
        the Closing Date, Buyer and Seller will make available to the other, as
        reasonably requested, all information, records or documents (including state
        apportionment information) relating to Tax liabilities or potential Tax
        liabilities of any Company with respect to (i) Tax periods ending on or prior
        to
        the Closing Date and (ii) Tax periods beginning before the Closing Date and
        ending after the Closing Date, but only with respect to the portion of such
        period up to and including the Closing Date. Buyer and Seller will preserve
        all
        such information, records and documents until the expiration of any applicable
        statute of limitations thereof. Buyer will prepare and provide to Seller
        any
        information or documents reasonably requested by Seller for Seller’s use in
        preparing or reviewing the Returns referred to in Section 11.2.
        At the
        request of Buyer, Seller shall promptly provide Buyer with information relevant
        to determining whether it is advisable for Buyer to request that elections
        be
        made under Section 338(h)(10) of the Code as discussed in Section 11.8.
        Notwithstanding any other provision hereof, each party will bear its own
        expenses in complying with the foregoing provisions.

       

      
        
          
          

        

        
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      11.5  Audits.
        Each
        party will promptly notify the other in writing upon receipt by such party
        (or
        any of its Tax Affiliates) of notice of any pending or threatened Tax
        liabilities of the Companies for any (i) Tax period ending on or before the
        Closing Date or (ii) Tax Period ending after the Closing Date but which includes
        the Closing Date. Seller will have the sole right to represent the interests
        of
        the Companies in any Tax audit or administrative or court proceeding for
        Tax
        periods ending on or prior to the Closing Date and to employ counsel of its
        choice at its expense, and Buyer and Seller agree to cooperate in the defense
        of
        any claim in such proceeding; provided, however, Seller shall not settle
        any
        such audit or administrative or court proceeding in a manner that would
        materially and adversely affect any Company after the Closing Date without
        the
        Buyer’s prior written consent which consent shall not be unreasonably withheld
        or delayed. Seller will have the right to participate at its expense in
        representing the interests of the Companies in any Tax audit or administrative
        or court proceeding for any Tax period ending after the Closing Date, if
        and to
        the extent that such period includes any Tax Period before the Closing Date,
        and
        to employ counsel of its choice at its expense. Seller and Buyer agree to
        cooperate in the defense of any claim in such proceeding. Buyer shall not
        settle
        any audit or administrative or court proceeding in a manner that would
        materially and adversely affect the Seller without the Seller’s prior written
        consent, which consent may not be unreasonably withheld or delayed.

       

      11.6  Tax
        Refunds.
        

       

      (a)  All
        refunds of Taxes relating to any Company received by Seller or any of its
        Tax
        Affiliates with respect to Tax periods or partial periods ending on or before
        the Closing Date will be for the account of Seller. At Seller’s request Buyer
        will take such action as reasonably requested by Seller to obtain such refunds,
        provided such action will not materially adversely affect any Company, the
        Buyer
        or the Parent. Buyer will pay over to Seller any such refunds that Buyer
        may
        receive immediately upon receipt of such request.

       

      (b)  All
        other
        refunds of Taxes with respect to any Company will be for the account of Buyer.
        At Buyer’s request, Seller will take such action as reasonably requested by
        Buyer to obtain such refunds, provided such action will not materially adversely
        affect the Seller, and will pay over to Buyer any such refunds immediately
        upon
        receipt thereof.

       

      11.7  Tax
        Sharing Agreements.
        All tax
        sharing agreements between Seller, on the one hand, and any Company, on the
        other hand, will be terminated as of the Closing Date after normal operations
        but before any “deemed sale of assets” under Section 338(h)(10).

       

      11.8  Section
        338(h)(10) Election.

       

      (a)  At
        the
        written request of Buyer on or before seven (7) months after the Closing
        Date,
        Seller will join, in an appropriate and timely manner, with Buyer in making
        one
        or more elections under Section 338(h)(10) of the Code (and any comparable
        elections under state or local law) with respect to the acquisition of the
        Companies by Buyer. If Buyer requests that a Section 338(h)(10) election
        be
        made, Buyer and Seller will: (a) cooperate fully with each other in the making
        of any such election including the filing of all required IRS forms and related
        forms under state and local Law and (b) endeavor in good faith to agree on
        an
        allocation of the Purchase Price among the assets of the Companies for purposes
        of Section 338 of the Code prior to the Closing Date to be evidenced by a
        written schedule signed and dated by Buyer and Seller, and Buyer and Seller
        will
        each file their Tax Return in a manner consistent with such
        allocation.

       

      
        
          
          

        

        
          -59-

          
            

          

        

        
          
          

        

      

       

      (b)  Seller
        will pay all Taxes attributable to the making of any Section 338(h)(10)
        election, including any federal, state, local or foreign Tax attributable
        to an
        election under federal, state, local or foreign law similar to the election
        available under Section 338(h)(10) of the Code.

       

      (c)  If
        Buyer
        requests that a Section 338(h)(10) election be made, Buyer will initially
        prepare a complete set of IRS Forms 8023 (and any comparable forms required
        to
        be filed under state, local or foreign tax law) and any additional data or
        materials required to be attached to Form 8023 pursuant to the Treasury
        Regulations promulgated under Section 338 of the Code (“Section
        338 Forms”).
        Buyer
        will deliver such forms to Seller for review no later than 60 days prior
        to the
        date the Section 338 Forms are required to be filed. In the event Seller
        reasonably objects to the manner in which the Section 338 Forms have been
        prepared, Seller will notify Buyer within 15 days of receipt of the Section
        338
        Forms of such objection, and the parties will endeavor within the next 15
        days
        to resolve such dispute in good faith. If the parties are unable to resolve
        such
        dispute within such 15-day period, Buyer and Seller will submit such dispute
        to
        an independent accounting firm of recognized national standing (the
“Allocation
        Arbiter”)
        selected by Buyer or Seller, which firm will not be the regular accounting
        firm
        of Buyer or Seller. Promptly, but not later than 15 days after its acceptance
        of
        appointment under this Agreement, the Allocation Arbiter will determine (based
        solely on representations of Buyer and Seller and not by independent review)
        only those matters in dispute and will render a written report as to the
        disputed matters and the resulting preparation of the Section 338 Forms will
        be
        conclusive and binding upon the parties.

       

      11.9  Tax
        Indemnification of Seller and Guarantor.
        From
        and after the Closing Date, Seller and Guarantor, jointly and severally,
        shall
        protect, defend, indemnify and hold harmless Parent, Buyer and the Companies
        from any and all Taxes which are imposed on the Companies in respect of their
        income, business, property or operations or for which the Companies may
        otherwise be liable (A) for any period or partial period ending on or prior
        to
        the Closing Date, (B) resulting by reason of the several liability of the
        Companies pursuant to Treasury Regulations Section 1.1502-6 or any analogous
        state, local or foreign law or regulation or by reason of any Company having
        been a member of any consolidated, combined or unitary group on or prior
        to the
        Closing Date, (C) attributable to any deferred income triggered into income
        by
        Treasury Regulation Section 1.1502-13, any excess loss accounts taken into
        income under Treasury Regulation Section 1.1502-19 and other similar items
        resulting from the Companies ceasing to be a member of any affiliated group
        (within the meaning of Code Section 1504(a)), (D) in respect of any period
        ending after the Closing Date, attributable to events, transactions, sales,
        deposits, services or rentals occurring, received or performed in a period
        ending on or prior to the Closing Date, (E) in respect of any period ending
        after the Closing Date attributable to any change in accounting method employed
        by the Companies during any of its previous taxable years, (F) attributable
        to
        any discharge of indebtedness that may result from any capital contributions
        by
        the Seller (or an affiliate of the Seller) to the Companies, or cancellation,
        of
        any intercompany indebtedness owed by the Companies to Seller (or an Affiliate
        of Seller), and (G) resulting from the breach of the Seller’s covenants
        regarding Tax matters, including, without limitation those set forth in this
        Article XI.

       

      
        
          
          

        

        
          -60-

          
            

          

        

        
          
          

        

      

       

      11.10  Tax
        Indemnification of Buyer.
        From
        and after the Closing Date, Buyer shall protect, defend, indemnify and hold
        harmless the Seller from any and all Taxes which are imposed on the Companies
        in
        respect of their income, business, property or operations or for which the
        Companies may otherwise be liable: (A) for any period or partial period
        beginning after the Closing Date and (B) resulting from the breach of the
        Buyer’s covenants regarding Tax matters, including, without limitation those set
        forth in this Article XI; provided, however, Buyer shall not indemnify Seller
        with respect to any Taxes for which Seller or Guarantor are otherwise
        responsible under this Agreement.

       

      XII.
          General

       

      12.1  Press
        Releases and Announcements.

       

      (a)  Neither
        Seller and Guarantor, on the one hand, nor Buyer Parties, on the other hand,
        shall make any public disclosure or announcement relating to this Agreement
        or
        the transactions contemplated by this Agreement without the prior written
        consent of the other. Notwithstanding the foregoing, Seller and Guarantor,
        on
        the one hand, or Buyer Parties, on the other hand, may make any public
        disclosure required by the United States or Canadian securities commissions
        or
        stock exchanges on which their shares are traded, or equivalent Japanese
        authorities, provided that the parties required to make any such disclosure
        shall use reasonable efforts to provide the other parties with two Business
        Days’ prior notice. Buyer
        Parties will have the right to be present for any in-person announcement
        by any
        Company. 

       

      (b)  Effective
        as of the Closing Date, the terms of the Confidentiality Agreement will cease
        to
        apply to confidential information relating to the Companies and their business,
        but such terms will otherwise remain in effect with respect to any confidential
        information relating to Guarantor’s and Seller’s other properties, Subsidiaries
        or Affiliates, and their respective businesses, and not relating to the
        Companies and their business. 

       

      12.2  Expenses.
        Except
        as otherwise expressly provided for in this Agreement, Seller and Guarantor,
        on
        the one hand, and Buyer Parties, on the other hand, will each pay all expenses
        incurred by each of them (and, in the case of Seller and Guarantor, the expenses
        incurred by the Companies) in connection with the transactions contemplated
        by
        this Agreement, including legal, accounting, investment banking and consulting
        fees and expenses incurred in negotiating, executing and delivering this
        Agreement and the other agreements, exhibits, documents and instruments
        contemplated by this Agreement (whether the transactions contemplated by
        this
        Agreement are consummated or not). Seller and Guarantor agree that none of
        the
        Companies has borne or will bear any of Seller’s or Guarantor’s expenses in
        connection with the transactions contemplated by this Agreement.

       

      12.3  Amendment
        and Waiver.
        This
        Agreement may not be amended, a provision of this Agreement or any default,
        misrepresentation or breach of warranty or agreement under this Agreement
        may
        not be waived, and a consent may not be rendered, except in a writing executed
        by the party against which such action is sought to be enforced. Neither
        the
        failure nor any delay by any Person in exercising any right, power or privilege
        under this Agreement will operate as a waiver of such right, power or privilege,
        and no single or partial exercise of any such right, power or privilege will
        preclude any other or further exercise of such right, power or privilege
        or the
        exercise of any other right, power or privilege. In addition, no course of
        dealing between or among any Persons having any interest in this Agreement
        will
        be deemed effective to modify or amend any part of this Agreement or any
        rights
        or obligations of any Person under or by reason of this Agreement. The rights
        and remedies of the parties to this Agreement are cumulative and not
        alternative.

       

      
        
          
          

        

        
          -61-

          
            

          

        

        
          
          

        

      

       

      12.4  Notices.
        All
        notices, demands and other communications to be given or delivered under
        or by
        reason of the provisions of this Agreement will be in writing and will be
        deemed
        to have been given (i) when delivered if personally delivered by hand (with
        written confirmation of receipt), (ii) when received if sent by a nationally
        recognized overnight courier service (receipt requested), (iii) five Business
        Days after being mailed, if sent by first class mail, return receipt requested,
        or (iv) when receipt is acknowledged by an affirmative act of the party
        receiving notice, if sent by facsimile, telecopy or other electronic
        transmission device (provided that such an acknowledgement does not include
        an
        acknowledgment generated automatically by a facsimile or telecopy machine
        or
        other electronic transmission device). Notices, demands and communications
        to
        Buyer Parties, Seller and Guarantor will, unless another address is specified
        in
        writing, be sent to the address indicated below:

       

      
        
          	
                  If
                    to any Buyer Party:

                   

                  Jipangu
                    Inc.

                  3-6-9-
                    Kita-Shinagawa

                  Shinagawa-ku
                    

                  Tokyo
                    140-0001

                  Japan

                  Attn:
                    President

                  Facsimile
                    No. +813 3474-4679

                   

                
	
                  With
                    a copy to:

                   

                  Dorsey
                    & Whitney LLP

                  1420
                    Fifth Avenue, Suite 3400

                  Seattle,
                    Washington

                  USA
                    98101

                  Attn:
                    Randal R. Jones

                  Facsimile
                    No. (206) 903-8820

                   

                  and
                    with a copy to:

                   

                  Davis
                    & Company LLP

                  Suite
                    2800 Park Place

                  666
                    Burrard Street

                  Vancouver,
                    British Columbia

                  Canada
                    V6C 2Z7

                  Attn:
                    John M. Sibley

                  Facsimile
                    No. (604) 605-3725

                   

                

        

         

        
          
            
            

          

          
            -62-

            
              

            

          

          
            
            

          

        

         

        
          	
                   

                  If
                    to Seller or Guarantor:

                   

                  Apollo
                    Gold Corporation

                  5655
                    South Yosemite Street

                  Suite
                    200

                  Greenwood
                    Village, Colorado

                  USA
                    80111-3220

                  Attn:
                    President

                  Facsimile
                    No. (720) 482-0957

                   

                
	
                  With
                    a copy to:

                   

                  Davis,
                    Graham & Stubbs LLP

                  1550
                    Seventeenth Street

                  Suite
                    500

                  Denver,
                    Colorado

                  USA
                    80202

                  Attn:
                    Deborah Friedman

                  Facsimile
                    No. (303) 893-1379

                   

                
	
                  and
                    with a copy to:

                   

                  Fogler
                    Rubinoff LLP

                  95
                    Wellington Street West, Suite 1200

                  Toronto-Dominion
                    Centre

                  Toronto,
                    Ontario M5J 2Z9

                  Canada

                  Attn:
                    Michael Hobart

                  Facsimile
                    No. (416) 941-8852

                   

                

        

      

      12.5  Assignment.
        Neither
        this Agreement nor any of the rights, interests or obligations under this
        Agreement may be assigned by any party to this Agreement without the prior
        written consent of the other parties to this Agreement, except that Buyer
        may
        assign any of its rights under this Agreement to one or more Subsidiaries
        of
        Parent, so long as Buyer remains responsible for the performance of all of
        its
        obligations under this Agreement. Subject to the foregoing, this Agreement
        and
        all of the provisions of this Agreement will be binding upon and inure to
        the
        benefit of the parties to this Agreement and their respective successors
        and
        permitted assigns.

       

      12.6  No
        Third-Party Beneficiaries.
        Nothing
        expressed or referred to in this Agreement confers any rights or remedies
        upon
        any Person that is not a party or permitted assign of a party to this
        Agreement.

       

      12.7  No
        Partnership and No Corporate Opportunity.
        Nothing
        in this Agreement creates, or is intended to create, any partnership, joint
        venture relationship, fiduciary relationship or relationship of confidence
        and
        trust between or among the Buyer Parties, Seller and Guarantor. Each party
        shall
        have the right to engage in, and receive full benefits from, any independent
        business activities or operations, whether or not competitive with the business
        activities or operations of the other parties or the Companies, without
        consulting with, or obligation to, any of the other parties. The doctrines
        of
        corporate opportunity or business opportunity that sometimes apply to persons
        engaged in a joint venture or having a fiduciary relationship or a relationship
        of confidence and trust shall not apply in the case of any of the parties
        to
        this Agreement.

       

      
        
          
          

        

        
          -63-

          
            

          

        

        
          
          

        

      

       

      12.8  Severability.
        Whenever possible, each provision of this Agreement will be interpreted in
        such
        manner as to be effective and valid under applicable Law, but if any provision
        of this Agreement is held to be prohibited by or invalid under applicable
        Law,
        such provision will be ineffective only to the extent of such prohibition
        or
        invalidity, without invalidating the remainder of such provision or the
        remaining provisions of this Agreement.

       

      12.9  Complete
        Agreement.
        This
        Agreement, the Confidentiality Agreement, the Promissory Note and, when executed
        and delivered, the Transition Services Agreement contain the complete agreement
        between the parties and supersede any prior understandings, agreements or
        representations by or between the parties, written or oral.

       

      12.10  Schedules.
        In the
        event of any inconsistency between the statements in this Agreement and
        statements in the Disclosure Schedule, the statements in this Agreement will
        control and the statements in the Disclosure Schedule will be
        disregarded.

       

      12.11  Signatures;
        Counterparts.
        This
        Agreement may be executed in one or more counterparts, any one of which need
        not
        contain the signatures of more than one party, but all such counterparts
        taken
        together will constitute one and the same instrument. A facsimile signature
        will
        be considered an original signature.

       

      12.12  Governing
        Law.
        THE
        DOMESTIC LAW, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES, OF THE STATE
        OF
        DELAWARE WILL GOVERN ALL QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY
        AND
        INTERPRETATION OF THIS AGREEMENT AND THE PERFORMANCE OF THE OBLIGATIONS IMPOSED
        BY THIS AGREEMENT.

       

      12.13  Specific
        Performance.
        Each of
        the parties acknowledges and agrees that the subject matter of this Agreement,
        including the business, assets and properties of the Companies, is unique,
        that
        the other parties would be damaged irreparably in the event any of the
        provisions of this Agreement are not performed in accordance with their specific
        terms or otherwise are breached, and that the remedies at law would not be
        adequate to compensate such other parties not in default or in breach.
        Accordingly, each of the parties agrees that the other 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 the terms and
        provisions of this Agreement in addition to any other remedy to which they
        may
        be entitled, at law or in equity (without any requirement that any Buyer
        Party
        provide any bond or other security). The parties waive any defense that a
        remedy
        at law is adequate and any requirement to post bond or provide similar security
        in connection with actions instituted for injunctive relief or specific
        performance of this Agreement.

       

      
        
          
          

        

        
          -64-

          
            

          

        

        
          
          

        

      

       

      12.14  Jurisdiction.
        Subject
        to the procedures specified in Article II, each of the parties submits to
        the
        exclusive jurisdiction of any state or federal court sitting in Wilmington,
        Delaware, in any action or proceeding arising out of or relating to this
        Agreement and agrees that all claims in respect of the action or proceeding
        may
        be heard and determined in any such court. Each party also agrees not to
        bring
        any action or proceeding arising out of or relating to this Agreement in
        any
        other court. Each of the parties waives any defense of inconvenient forum
        to the
        maintenance of any action or proceeding so brought and waives any bond, surety
        or other security that might be required of any other party with respect
        to any
        such action or proceeding. Each party appoints The Corporation Trust Company
        (the “Process
        Agent”)
        as its
        agent to receive on its behalf service of copies of the summons and complaint
        and any other process that might be served in the action or proceeding. Any
        party may make service on any other party by sending or delivering a copy
        of the
        process (i) to the party to be served or (ii) to the party to be served in
        care
        of the Process Agent at the following address: Corporation Trust Center,
        1209
        Orange Street, Wilmington, Delaware 19801. The parties agree that either
        or both
        of them may file a copy of this paragraph with any court as written evidence
        of
        the knowing, voluntary and bargained agreement between the parties irrevocably
        to waive any objections to venue or to convenience of forum.

       

      12.15  Waiver
        of Jury Trial.
        EACH
        PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY THAT MAY ARISE UNDER THIS
        AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE
        IT IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL
        BY
        JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR
        RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.
        EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (I) NO REPRESENTATIVE, AGENT OR
        ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT
        SUCH
        OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
        WAIVER, (II) IT UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF SUCH WAIVER,
        (III) IT MAKES SUCH WAIVER VOLUNTARILY AND (IV) IT HAS BEEN INDUCED TO ENTER
        INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVER AND CERTIFICATIONS
        IN THIS SECTION 12.15.

       

      12.16  Construction.
        The
        parties and their respective counsel have participated jointly in the
        negotiation and drafting of this Agreement. In addition, each of the parties
        acknowledges that it is sophisticated and has been advised by experienced
        counsel and, to the extent it deemed necessary, other advisors in connection
        with the negotiation and drafting of this Agreement. In the event 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 by virtue of the authorship of any
        of
        the provisions of this Agreement. The parties intend that each representation,
        warranty and agreement contained in this Agreement will have independent
        significance. If any party has breached any representation, warranty or
        agreement in any respect, the fact that there exists another representation,
        warranty or agreement relating to the same subject matter (regardless of
        the
        relative levels of specificity) that 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 agreement. Any reference to any Law will be deemed
        to refer to all rules and regulations promulgated thereunder, unless the
        context
        requires otherwise. The headings preceding the text of articles and sections
        included in this Agreement and the headings to the schedules and exhibits
        are
        for convenience only and are not be deemed part of this Agreement or given
        effect in interpreting this Agreement. References to sections, articles,
        schedules or exhibits are to the sections, articles, schedules and exhibits
        contained in, referred to or attached to this Agreement, unless otherwise
        specified. The word “including” means “including without limitation.” A
        statement that an action has not occurred in the past means that it is also
        not
        presently occurring. When any party may take any permissive action, including
        the granting of a consent, the waiver of any provision of this Agreement
        or
        otherwise, whether to take such action is in its sole and absolute discretion.
        The use of the masculine, feminine or neuter gender or the singular or plural
        form of words will not limit any provisions of this Agreement. A statement
        that
        an item is listed, disclosed or described means that it is correctly listed,
        disclosed or described, and a statement that a copy of an item has been
        delivered means a true and correct copy of the item has been
        delivered.

       

      
        
          
          

        

        
          -65-

          
            

          

        

        
          
          

        

      

       

      12.17  Currency.
        All
        references in this Agreement to “$” are references to United States
        dollars.

       

      12.18  Time
        of Essence.
        With
        regard to all dates and time periods set forth or referred to in this Agreement,
        time is of the essence.

       

      12.19  Consequential
        or Special Damages.
        IN NO
        EVENT SHALL ANY PARTY HERETO BE LIABLE FOR ANY LOST PROFITS, BUSINESS
        INTERRUPTION OR FOR ANY INDIRECT, INCIDENTAL, SPECIAL, CONSEQUENTIAL, EXEMPLARY
        OR PUNITIVE DAMAGES ARISING OUT OF OR RELATING TO THE TRANSACTIONS CONTEMPLATED
        BY THIS AGREEMENT, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH
        DAMAGES.

       

      
        
          
          

        

        
          -66-

          
            

          

        

        
          
          

        

      

      IN
        WITNESS WHEREOF,
        Buyer
        Parties, Seller and Guarantor have executed this Stock Purchase Agreement
        as of
        the date first above written.

       

      
        	
                BUYER:

                 

                JIPANGU
                  INTERNATIONAL INC.

                 

                
                   

                  By:  
                    /s/ Tamisuke Matsufuji

                  
                    

                  

                  Name:   Tamisuke
                    Matsufuji

                  Title:    
                    President and CEO

                

                 

                 

                 

                PARENT:

                 

                JIPANGU
                  INC.

                 

                 

                By:  
                  /s/ Tamisuke Matsufuji

                
                  

                

                Name:   Tamisuke
                  Matsufuji

                Title:    
                  President and CEO

              	
                SELLER:

                 

                APOLLO
                  GOLD, INC.

                 

                 

                
                  By:  
                    /s/ R. David Russell

                  
                    

                  

                  Name:  
                    R. David Russell

                  Title:    
                    President and CEO

                

                 

                 

                 

                GUARANTOR:

                 

                APOLLO
                  GOLD CORPORATION

                 

                 

                By:  
                  /s/ R. David Russell

                
                  

                

                Name:  
                  R. David Russell

                Title:    
                  President and CEO

              

      

      

      

      
        
          
          

        

        
          -67-

          
            

          

        

        
          
          

        

      

    

     

    DISCLOSURE
      SCHEDULE

     

     

    TO

     

     

    STOCK
      PURCHASE AGREEMENT

     

    among

     

    Jipangu
      Inc.,

     

    Jipangu
      International Inc.,

     

    Apollo
      Gold, Inc.

     

    and

     

    Apollo
      Gold Corporation

     

    made
      as of

     

    October
      17, 2005

     

    
 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

        
        

      

    

    

    STOCK
      PURCHASE AGREEMENT

    

    Schedule
      4.1

    Jurisdictions
      of Organization, Qualification and Other Corporate Matters

     

    
      	
              EXPLORATION

            	 	 
	 	 	 
	
              Name
                of Company:

            	 	
              Apollo
                Gold Exploration, Inc.

            
	
              US
                Federal ID No. (EIN):

            	 	
              03-0447036

            
	
              Jurisdiction
                of Organization:

            	 	
              Delaware
                (File No. 3528958)

            
	
              Form
                as a Legal Entity:

            	 	
              Corporation

            
	
              Jurisdiction(s)
                in Which Qualified:

            	 	
              Nevada
                (Corp. No. C13297-2002)

            
	 	 	 
	
              FLORIDA
                CANYON

            	 	 
	 	 	 
	
              Name
                of Company:

            	 	
              Florida
                Canyon Mining, Inc.

            
	
              US
                Federal ID No. (EIN):

            	 	
              91-1225980

            
	
              Jurisdiction
                of Organization:

            	 	
              Delaware
                (File No. 2979963)

            
	
              Form
                as a Legal Entity:

            	 	
              Corporation

            
	
              Jurisdiction(s)
                in Which Qualified:

            	 	
              Nevada
                (Corp. No. C3475-1999)

            
	 	 	 
	
              STANDARD

            	 	 
	 	 	 
	
              Name
                of Company:

            	 	
              Standard
                Gold Mining, Inc.

            
	
              US
                Federal ID No. (EIN):

            	 	
              04-3688394

            
	
              Jurisdiction
                of Organization:

            	 	
              Delaware
                (File No. 3539532)

            
	
              Form
                as a Legal Entity:

            	 	
              Corporation

            
	
              Jurisdiction(s)
                in Which Qualified:

            	 	
              Nevada
                (Corp. No. C17070-2002)

            

    

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    STOCK
      PURCHASE AGREEMENT

    

    Schedule
      4.8(q)

    Material
      Adverse Effect and Other Changes

     

    Encumbrances
      valued at $50,000 or more individually or $100,000 or more in the aggregate
      discharged or satisfied other than current liabilities paid in the Ordinary
      Course of Business:

    

    

    
      	
              Model

            	 	
              Description

            	 	
              Serial
                Number

            
	
              785B

            	 	
              USED
                Caterpillar OFF-HIGHWAY TRUCK

            	 	
              6HK00491

            
	
              785B

            	 	
              USED
                Caterpillar OFF-HIGHWAY TRUCK

            	 	
              6HK00493

            
	
              785B

            	 	
              USED
                Caterpillar OFF-HIGHWAY TRUCK

            	 	
              6HK00494

            
	
              834B

            	 	
              USED
                Caterpillar WHEEL TRACTOR

            	 	
              92Z00622

            
	
              994

            	 	
              USED
                Caterpillar WHEEL LOADER

            	 	
              9YF00147

            
	
              990F

            	 	
              USED
                Caterpillar WHEEL LOADER

            	 	
              7HK00066

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    STOCK
      PURCHASE AGREEMENT

    

    Schedule
      4.9(a)(v)

    Buildings,
      Plants, Etc.

    

    

    
      	
              Building
                Name

            	 	
              Size
                (sq ft)

            	 	
              Height

            
	
              Truck
                Shop & Warehouse

            	 	
              20,250

            	 	
              2-story

            
	
              Main
                Administration Office

            	 	
              7,200

            	 	
              1-story

            
	
              Main
                Exploration Office

            	 	
              2,500

            	 	
              1-story

            
	
              Exploration
                Office Trailer

            	 	
              1,500

            	 	
              1-story

            
	
              Exploration
                Storage Trailer #1

            	 	
              540

            	 	
              1-story

            
	
              Core
                Shed

            	 	
              650

            	 	
              1-story

            
	
              Exploration
                Storage Trailer #2

            	 	
              405

            	 	
              1-story

            
	
              Leach
                Crew Office Trailer

            	 	
              675

            	 	
              1-story

            
	
              Acid
                Wash/Carbon Regeneration Process Building

            	 	
              1350

            	 	
              2-story

            
	
              Assay
                Lab/A Columns Plant/Welding Shop/Refinery

            	 	
              7500

            	 	
              2-story

            
	
              Small
                Vehicle Repair Shop (Abandoned)

            	 	
              4050

            	 	
              2-story

            
	
              Crusher
                Office

            	 	
              950

            	 	
              1-story

            
	
              Small
                Vehicle Repair Quonset Hut

            	 	
              2560

            	 	
              1-story

            
	
              Crusher
                Parts Storage

            	 	
              4140

            	 	
              1-story

            
	
              Shed
                

            	 	
              132

            	 	
              1-story

            
	
              Crusher
                Trailer Office #1

            	 	
              660

            	 	
              1-story

            
	
              Crusher
                Trailer Office #2

            	 	
              660

            	 	
              1-story

            

    

    

    

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

        
        

      

    

    

    STOCK
      PURCHASE AGREEMENT

    

    Schedule
      4.9(a)(vi)

    Equipment

    

    Equipment
      Valued at US$ 5,000 or More 

    
      
        	
                MAJOR
                  & SUPPORT EQUIPMENT

              	 	 	 

      

       

      
        	
                Equip
                  #

              	 	
                Description

              	 	
                Serial
                  No.

              	 	
                Encumbered
                  Under Cat Installment Sale Contract Number

              	 	
                Cat
                  Lease

              
	
                3105

              	 	
                777B
                  WATER TRUCK

              	 	
                4YC01348

              	 	 	 	 
	
                3107

              	 	
                KENWORTH
                  WATER TRUCK

              	 	
                512431

              	 	 	 	 
	
                3108

              	 	
                777B
                  WATER TRUCK

              	 	
                4YC00200

              	 	   
                 	 	   
                 
	
                3151

              	 	
                785B
                  HAUL TRUCK

              	 	
                6HK00489

              	 	
                2274

              	 	 
	
                3152

              	 	
                785B
                  HAUL TRUCK

              	 	
                6HK00490

              	 	
                2274

              	 	 
	
                3154

              	 	
                785B
                  HAUL TRUCK

              	 	
                6HK00492

              	 	
                2274

              	 	 
	
                3157

              	 	
                785B
                  HAUL TRUCK

              	 	
                6HK00495

              	 	
                2274

              	 	 
	
                3158

              	 	
                785B
                  HAUL TRUCK

              	 	
                6HK00496

              	 	
                2274

              	 	 
	
                3159

              	 	
                785B
                  HAUL TRUCK

              	 	
                6HK00497

              	 	
                2274

              	 	 
	
                3160

              	 	
                785B
                  HAUL TRUCK

              	 	
                6HK00498

              	 	
                2274

              	 	 
	
                3161

              	 	
                785B
                  HAUL TRUCK

              	 	
                6HK00499

              	 	
                2274

              	 	 
	
                3162

              	 	
                785B
                  HAUL TRUCK

              	 	
                6HK00500

              	 	
                2274

              	 	 
	
                3211

              	 	
                992C
                  LOADER CERTIFIED-OLD PIN #49Z01414

              	 	
                49Z75287
                  (Old 49Z01414)

              	 	   
	 	   
                 
	
                3213

              	 	
                992D
                  LOADER

              	 	
                7MJ00456

              	 	
                2274

              	 	 
	
                3215

              	 	
                992G

              	 	
                ADZ00453

              	 	   
                 	 	
                7290

              
	
                3301

              	 	
                D9R
                  CAT DOZER

              	 	
                7TL00509

              	 	
                2274

              	 	 
	
                3302

              	 	
                D9R
                  CAT DOZER

              	 	
                7TL00510

              	 	
                2274

              	 	 
	
                3304

              	 	
                D10N
                  CAT DOZER

              	 	
                3SK00994

              	 	
                2274

              	 	 
	
                3308

              	 	
                690
                  TIGER RUBBER TIRE DOZER

              	 	
                05A10987
                  / 7MJ00528

              	 	
                2274

              	 	 
	
                3401

              	 	
                245
                  DRILL

              	 	
                732096

              	 	 	 	 
	
                3402

              	 	
                245
                  DRILL

              	 	
                732097

              	 	 	 	 
	
                3404

              	 	
                DRILLTECH
                  C40 KSH CRAWLER DRILL

              	 	
                731749

              	 	 	 	 
	
                3406

              	 	
                D25KS
                  DRILTECH DRILL

              	 	
                731904

              	 	 	 	 
	
                3407

              	 	
                D245
                  DRILLTECH DRILL

              	 	
                732107

              	 	 	 	 
	
                3516

              	 	
                16G
                  CAT MOTOR GRADER

              	 	
                93U03265

              	 	  
                 	 	  
                 
	
                3517

              	 	
                16H
                  CAT MOTOR GRADER

              	 	
                6ZJ0044

              	 	
                2274

              	 	   
                 
	
                3623

              	 	
                FORD
                  L8000 TIRE TRUCK

              	 	
                1FDZW82A6KVA077562K

              	 	 	 	 
	
                3625

              	 	
                DP100
                  FORK LIFT

              	 	
                3DP0040

              	 	 	 	 
	
                3627

              	 	
                INTERNATIONAL
                  DUMPTRUCK

              	 	
                1HTLDTVR4GHA25995

              	 	 	 	 
	
                3631

              	 	
                4O
                  TON LINKBELT CRANE

              	 	
                5310-290

              	 	 	 	 
	
                3636

              	 	
                WATER
                  STAND/COMPRESSOR

              	 	 	 	 	 	 
	
                3700

              	 	
                LUBE
                  TRUCK

              	 	
                1NKDX6TXRJ616249

              	 	 	 	 

      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      
        	
                MAJOR
                  & SUPPORT EQUIPMENT (cont.)

              	 	 

      

       

      
        
          
            
              
                	
                        Equip
                          #

                      	
                      	
                        Description

                      	 	
                        Serial
                          No.

                      	 	
                        Encumbered
                          Under Cat Installment Sale Contract Number

                      	 	
                        Cat
                          Lease

                      
	
                        3701

                      	
                      	
                        KW
                          LUBE TRUCK

                      	 	
                        INKDX6TX4RJ616251

                      	 	 	 	 
	
                        3702

                      	 	
                        FUEL
                          TRUCK

                      	 	
                        INKDX6TX4RJ616253

                      	 	 	 	 
	
                        3703

                      	 	
                        SMALL
                          LUBE TRUCK

                      	 	
                        1FDXR8ZAXLVA01054

                      	 	 	 	 
	
                        3704

                      	 	
                        SMALL
                          SERVICE TRUCK

                      	 	
                        1FDLF47G6SEA69251

                      	 	 	 	 
	
                        3705

                      	 	
                        SERVICE
                          TRUCK & WELDER # 705

                      	 	
                        1FDXF80E3SVA81388

                      	 	 	 	 
	
                        3706

                      	 	
                        WELDING
                          TRUCK & WELDER # 706

                      	 	
                        1FDXF80E3TVA20124

                      	 	 	 	 
	
                        3707

                      	 	
                        GMC
                          BOX VAN

                      	 	
                        J8DC4B1K2P7009389

                      	 	 	 	 
	
                        3708

                      	 	
                        SERVICE
                          TRUCK

                      	 	
                        1FDXK74C2PVA17719

                      	 	 	 	 
	
                        3709

                      	 	
                        ATLAS
                          COPCO XAS 90 COMPRESSOR

                      	 	
                        YA3-04T084-00225943

                      	 	 	 	 
	
                        3710

                      	 	
                        CT85
                          CAT GENERATOR SET

                      	 	
                        2020881

                      	 	 	 	 
	
                        3711

                      	 	
                        MAXI-LIGHT
                          LIGHT PLANT

                      	 	
                        951101

                      	 	 	 	 
	
                        3711-3721

                      	 	
                        MAXI-LIGHT
                          LIGHT PLANTS

                      	 	 	 	 	 	 
	
                        3712

                      	 	
                        MAXI-LIGHT
                          LIGHT PLANT

                      	 	
                        951102

                      	 	 	 	 
	
                        3713

                      	 	
                        MAXI-LIGHT
                          LIGHT PLANT

                      	 	
                        951103

                      	 	 	 	 
	
                        3714

                      	 	
                        MAXI-LIGHT
                          LIGHT PLANT

                      	 	
                        951104

                      	 	 	 	 
	
                        3715

                      	 	
                        MAXI-LIGHT
                          LIGHT PLANT

                      	 	
                        951105

                      	 	 	 	 
	
                        3716

                      	 	
                        MAXI-LIGHT
                          LIGHT PLANT

                      	 	
                        951106

                      	 	 	 	 
	
                        3717

                      	 	
                        MAXI-LIGHT
                          LIGHT PLANT

                      	 	
                        951107

                      	 	 	 	 
	
                        3718

                      	 	
                        MAXI-LIGHT
                          LIGHT PLANT

                      	 	
                        951108

                      	 	 	 	 
	
                        3719

                      	 	
                        MAXI-LIGHT
                          LIGHT PLANT

                      	 	
                        870815

                      	 	 	 	 
	
                        3721

                      	 	
                        MAXI-LIGHT
                          LIGHT PLANT

                      	 	
                        900704

                      	 	 	 	 
	
                        3725

                      	 	
                        HOTSY
                          STATIONARY STEAM CLEANER

                      	 	 	 	 	 	 
	
                        3726

                      	 	
                        HOTSY
                          STEAM CLEANER

                      	 	
                        H328891095

                      	 	 	 	 
	
                        3727

                      	 	
                        L90B
                          VOLVO LOADER

                      	 	
                        L90V61570

                      	 	 	 	 
	
                        3729

                      	 	
                        CAT
                          330L EXCAVATOR

                      	 	
                        5YM00357

                      	 	 	 	 
	
                        3730

                      	 	
                        1990
                          MACK SERVICE TRUCK

                      	 	
                        VIN#VG6M114B8MB200663

                      	 	 	 	 
	
                        3731

                      	 	
                        1999
                          FREIGHTLINER SERVICE TRUCK

                      	 	
                        1FV3GJAC6XHA41016

                      	 	 	 	 
	
                        3732

                      	 	
                        1989
                          PETERBUILT & LOWBOY

                      	 	
                        1XP5089X5KD287786

                      	 	 	 	 
	
                        3737

                      	 	
                        T800
                          MACK - LUBE TRUCK

                      	 	
                        J740694

                      	 	 	 	 
	
                        3740

                      	 	
                        CAT
                          GEN SET

                      	 	
                        24Z03244

                      	 	 	 	 
	
                        3741

                      	 	
                        CAT
                          GEN SET

                      	 	 	 	 	 	 
	
                        3751

                      	 	
                        CAT
                          GEN SET -- TRAILER MOUNTED (SPARE)

                      	 	
                        8028002

                      	 	 	 	 
	
                        3752

                      	 	
                        DW2
                          DEWATERING GENERATOR

                      	 	
                        2015455

                      	 	 	 	 
	
                        3753

                      	 	
                        DW3
                          DEWATERING PUMP

                      	 	
                        8221983
                          1442/99

                      	 	 	 	 
	
                        3754

                      	 	
                        Blue
                          dewatering pump

                      	 	
                        PUMP
                          SN1013568 GORMAN RUPP

                      	 	 	 	 
	
                        3755

                      	 	
                        MILLER
                          600 TRAILER MT. WELDER

                      	 	
                        96053
                          TRAILER /KG195896 WELDER

                      	 	 	 	 
	
                        3756

                      	 	
                        SULL
                          AIR ES-6 COMPRESSOR

                      	 	
                        E8388.
                          1234567890

                      	 	 	 	 
	
                        3757

                      	 	
                        GEN
                          SET AT OLD MAINTENANCE SHOP

                      	 	 	 	 	 	 
	
                        3758

                      	 	
                        40D-WELDER--TRAILER
                          MOUNT

                      	 	
                        KF970706

                      	 	 	 	 
	
                        3759

                      	 	
                        KONE
                          SHOP CRANE

                      	 	
                        56654

                      	 	 	 	 
	
                        3760

                      	 	
                        QUINCY
                          AIR COMPRESOR

                      	 	
                        91261J

                      	 	 	 	 

              

               

               

              
                
                  
                  

                

                
                  
                  

                  
                    

                  

                

                
                  
                  

                

              

            

             

          

        

      

    

    
      
        	
                LIGHT
                  VEHICLE EQUIPMENT

              

      

       

      
        	
                Equipment
                  No.

              	 	
                Description

              	 	
                Serial
                  No.

              
	
                906

              	 	
                2001
                  F250 FORD LARIAT-MINE OPS SPV

              	 	
                AFTNF21L41EA87544

              
	
                928

              	 	
                CRUSHER
                  MAINTENANCE WELDING TRUCK

              	 	
                1FDKF37M7JKB30196

              
	
                1004

              	 	
                2005
                  CHEVY 3/4 TON - JIM LINDSEY

              	 	
                1GCHK24U55E330068

              
	
                1005

              	 	
                2005
                  GMC 3/4 TON MARTY PRICE

              	 	
                1GTHK24U05E332665

              

      

    

    

    
      
        	
                ANCILLARY
                  EQUIPMENT

              	 	 

      

       

      
        	
                Equipment
                  No.

              	 	
                Description

              	 	
                Serial
                  No.

              	 	
                In
                  Service

              
	 	 	 	 	 	 	 
	
                801-CRANE

              	 	
                90
                  TON CRANE

              	 	
                47979

              	 	
                Y

              
	
                801-TRUCK

              	 	
                90
                  TO CRANE CARRIER

              	 	
                47979

              	 	
                Y

              
	
                802

              	 	
                NATIONAL
                  BOOM TRUCK- CRUSHER

              	 	
                1FDZT74D2HVA58062

              	 	
                Y

              
	
                804

              	 	
                580
                  K BACKHOE

              	 	
                JJG0009342

              	 	
                Y

              
	
                805

              	 	
                AIR
                  COMPRESSOR AT CRUSHER

              	 	
                007-87001410

              	 	
                Y

              
	
                808

              	 	
                GEN
                  SET AT PLANT

              	 	
                3312224

              	 	
                Y

              
	
                810

              	 	
                DETROIT
                  DIESEL POWERED GENSET

              	 	
                23-D-67

              	 	
                Y

              
	
                812

              	 	
                D4
                  CAT DOZER

              	 	
                8PB02881

              	 	
                Y

              
	
                816

              	 	
                HYDRO
                  BLASTER AT CRUSHER

              	 	
                900406

              	 	
                Y

              
	
                821

              	 	
                CAT
                  FORK LIFT - LAB

              	 	
                3351026

              	 	
                Y

              
	
                822

              	 	
                CAT
                  FORK LIFT- CRUSHER

              	 	
                2PJ00421

              	 	
                Y

              
	
                823

              	 	
                580
                  C CASE BACKHOE

              	 	
                9007575

              	 	
                Y

              
	
                824

              	 	
                VACUUM
                  TRUCK

              	 	
                94-05-5206

              	 	
                Y

              
	
                833

              	 	
                GEN
                  SET AT PLANT

              	 	
                66BO8951

              	 	
                Y

              
	
                834

              	 	
                SKID
                  STEER LOADER- CRUSHER

              	 	
                871319

              	 	
                Y

              
	
                835

              	 	
                GPL40
                  FORK LIFT / WAREHOUSE

              	 	
                ICM00845

              	 	
                Y

              
	
                836

              	 	
                GEN
                  SET AT THE PLANT

              	 	
                5TD00824

              	 	
                Y

              
	
                837

              	 	
                BUCKET
                  TRUCK INTERNATIONAL S1900 1981

              	 	
                9208055956

              	 	
                Y

              
	
                842

              	 	
                1980
                  FREIGHTLINER WATER TRUCK 183632

              	 	
                CB113HP183632

              	 	
                Y

              
	
                843

              	 	
                V80E
                  FORK LIFT

              	 	
                37W08364

              	 	
                Y

              
	
                844

              	 	
                BOBCAT-
                  CRUSHER

              	 	
                510127817

              	 	
                Y

              

      

    

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      
        	
                ANCILLARY
                  EQUIPMENT

              	 	 

      

       

      
        	
                Equipment
                  No.

              	 	
                Description

              	 	
                Serial
                  No.

              	 	
                In
                  Service

              
	 	 	 	 	 	 	 
	
                801-CRANE

              	 	
                90
                  TON CRANE

              	 	
                47979

              	 	
                Y

              
	
                801-TRUCK

              	 	
                90
                  TO CRANE CARRIER

              	 	
                47979

              	 	
                Y

              
	
                802

              	 	
                NATIONAL
                  BOOM TRUCK- CRUSHER

              	 	
                1FDZT74D2HVA58062

              	 	
                Y

              
	
                804

              	 	
                580
                  K BACKHOE

              	 	
                JJG0009342

              	 	
                Y

              
	
                805

              	 	
                AIR
                  COMPRESSOR AT CRUSHER

              	 	
                007-87001410

              	 	
                Y

              
	
                808

              	 	
                GEN
                  SET AT PLANT

              	 	
                3312224

              	 	
                Y

              
	
                810

              	 	
                DETROIT
                  DIESEL POWERED GENSET

              	 	
                23-D-67

              	 	
                Y

              
	
                812

              	 	
                D4
                  CAT DOZER

              	 	
                8PB02881

              	 	
                Y

              
	
                816

              	 	
                HYDRO
                  BLASTER AT CRUSHER

              	 	
                900406

              	 	
                Y

              
	
                821

              	 	
                CAT
                  FORK LIFT - LAB

              	 	
                3351026

              	 	
                Y

              
	
                822

              	 	
                CAT
                  FORK LIFT- CRUSHER

              	 	
                2PJ00421

              	 	
                Y

              
	
                823

              	 	
                580
                  C CASE BACKHOE

              	 	
                9007575

              	 	
                Y

              
	
                824

              	 	
                VACUUM
                  TRUCK

              	 	
                94-05-5206

              	 	
                Y

              
	
                833

              	 	
                GEN
                  SET AT PLANT

              	 	
                66BO8951

              	 	
                Y

              
	
                834

              	 	
                SKID
                  STEER LOADER- CRUSHER

              	 	
                871319

              	 	
                Y

              
	
                835

              	 	
                GPL40
                  FORK LIFT / WAREHOUSE

              	 	
                ICM00845

              	 	
                Y

              
	
                836

              	 	
                GEN
                  SET AT THE PLANT

              	 	
                5TD00824

              	 	
                Y

              
	
                837

              	 	
                BUCKET
                  TRUCK INTERNATIONAL S1900 1981

              	 	
                9208055956

              	 	
                Y

              
	
                842

              	 	
                1980
                  FREIGHTLINER WATER TRUCK 183632

              	 	
                CB113HP183632

              	 	
                Y

              
	
                843

              	 	
                V80E
                  FORK LIFT

              	 	
                37W08364

              	 	
                Y

              
	
                844

              	 	
                BOBCAT-
                  CRUSHER

              	 	
                510127817

              	 	
                Y

              

      

    

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

        
        

      

    

    

    STOCK
      PURCHASE AGREEMENT

    

    Schedule
      4.9(g)

    Machinery,
      Equipment, Etc. Required to Operate Business

    

    Caterpillar
      Corporation (“Cat”) and Cashman Equipment Inc. are testing an experimental model
      of a Cat 992X  Experimental Loader with Serial Number Z4X00151 owned
      by Cat
      and on loan to Florida Canyon and Standard. The loader will remain on the
      premises as long as Cat requires the testing or at the discretion of Florida
      Canyon’s and Standard’s management. Operating costs relative to this loader are
      paid by Florida Canyon and Standard in the ordinary course of business. The
      inclusion of this loader on this Schedule 4.9(g) shall not be read to imply
      that
      the Companies do not own other loaders sufficient to comply with the
      representation and warranty set forth in Section 4.9(g) of the
      Agreement.

    

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    STOCK
      PURCHASE AGREEMENT

    

    Schedule
      4.11(g)

    Income
      Tax Returns

    

    U.S.
      Federal

    

    Seller
      and the Companies filed U.S. Income Tax returns for the following
      periods:

    

    01/01/2002
      - 12/31/2002

    01/01/2003
      - 12/31/2003

    These
      returns have not been audited and are not currently the subject of an
      audit.

    

    State 

    

    Florida
      Canyon filed Nevada State Net Proceeds of Minerals Tax Returns for the following
      periods:

    

    01/01/2001
      - 12/31/2001

    01/01/2002
      - 12/31/2002

    01/01/2003
      - 12/31/2003

    01/01/2004
      - 12/31/2004

    These
      returns have not been audited and are not currently the subject of an audit.
      

    

    Standard
      filed Nevada State Net Proceeds of Minerals Tax Returns for the following
      periods:

    

    01/01/2004
      - 12/31/2004

    This
      return has not been audited and is not currently the subject of an
      audit.

    

    Foreign

    

    Seller
      filed Form T2s in Canada for the following periods:

    

    01/01/2002
      - 6/24/2002 

    06/25/2002
      - 12/31/2002

    01/01/2003
      - 12/31/2003 as amended by Amended T2.

    01/01/2004
      - 12/31/2004 

    

    Seller
      filed Form CT23s in Canada for the following periods:

    

    01/01/2002
      - 06/24/2002 

    06/25/2002
      - 12/31/2002 

    01/01/2003
      - 12/31/2003 

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

        
        

      

    

    

    STOCK
      PURCHASE AGREEMENT

    

    Schedule
      4.16(b)

    Governmental
      Authorizations

    

    

    Governmental
      Authorizations

    

    
      	
              License/Permit

            	 	
              Entity

            	 	
              Governmental
                Level

            
	
              Business
                License

            	 	
              Florida
                Canyon

            	 	
              State
                of Nevada Dept of Taxation

            
	
              Business
                License

            	 	
              Standard

            	 	
              State
                of Nevada Dept of Taxation

            
	
              Business
                License

            	 	
              Exploration

            	 	
              State
                of Nevada Dept of Taxation

            
	
              Business
                License

            	 	
              Florida
                Canyon

            	 	
              County
                of Pershing

            
	
              Business
                License

            	 	
              Standard

            	 	
              County
                of Pershing

            
	
              Business
                License

            	 	
              Exploration

            	 	
              County
                of Pershing

            

    

     

    The
      Governmental Authorizations relating to the Environmental Law necessary for
      operations of the Companies as currently conducted are set forth in
      Schedule 4.17(h)(2).

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

        
        

      

    

    

    STOCK
      PURCHASE AGREEMENT

    

    Schedule
      4.17(h)(2)

    Governmental
      Authorizations Relating to Environmental Law

    Environmental
      Permits

     

    
      
        	
                FLORIDA
                  CANYON MINE

              
	
                Permit/Approval
                  Name

              	
                Granting
                  Agency

              	
                Expiration
                  Date

              	
                Name
                  of Permittee

              
	
                Approval
                  of Plan of Operations, Rights-of-Way Permits

              	
                Bureau
                  of Land Management

              	
                Plan
                  Of Operations/2008

              	
                Florida
                  Canyon Mining Inc

              
	
                Small
                  Quantity Hazardous Waste Generator

              	
                U.S.
                  Environmental Protection Agency

              	
                None

              	
                Florida
                  Canyon Mining Inc

              
	
                Explosives
                  Permit

              	
                Bureau
                  of Alcohol, Tobacco and Firearms

              	
                Held
                  by contractor

              	 
	
                Surface
                  Disturbance and Class II Air Quality Operating Permit

              	
                Nevada
                  Bureau of Air Quality

              	
                Air
                  Pollution Control / Aug, 2009

              	
                Florida
                  Canyon Mining Inc

              
	
                Water
                  Pollution Control Permit

              	
                Nevada
                  Bureau of Mining Regulation and Reclamation

              	
                Mining,
                  Mineral Processing, Ancillary Activities incl landfill/ life of
                  mine

              	
                Florida
                  Canyon Mining Inc

              
	
                Reclamation
                  Permit

              	
                Nevada
                  Bureau of Mining Regulation and Reclamation

              	
                Reclamation
                  & Cost Estimate/life of project

              	
                Florida
                  Canyon Mining Inc

              
	
                Permit
                  to Appropriate Water and to Construct Impoundments

              	
                Nevada
                  Division of Water Resources

              	
                Pump
                  and use water/various and multiple

              	
                Florida
                  Canyon Mining Inc

              
	
                Industrial
                  Artificial Ponds

              	
                Nevada
                  Division of Wildlife

              	
                Operate
                  an artificial industrial pond/ May 2008

              	
                Florida
                  Canyon Mining Inc

              
	
                Solid
                  Waste Mining Site Class III Waiver

              	
                Nevada
                  Bureau of Waste Management

              	
                Included
                  in WPC and Reclaim Permits

              	
                Florida
                  Canyon Mining Inc

              
	
                General
                  Discharge Permit (Stormwater, Septic Tank Systems)

              	
                Nevada
                  Bureau of Water Pollution Control

              	
                Stormwater/Sept
                  2010

              	
                Florida
                  Canyon Mining Inc

              
	
                Hazardous
                  Materials Storage Permit

              	
                Nevada
                  State Fire Marshall

              	
                Hazardous
                  Materials Storage/February 28, 2006

              	
                Florida
                  Canyon Mining Inc

              
	
                Liquefied
                  Petroleum Gas License

              	
                Nevada
                  Liquefied Petroleum Gas Board

              	
                Operate
                  Propane tans/December 2005

              	
                Florida
                  Canyon Mining Inc

              
	
                Domestic
                  Water Supply

              	
                Nevada
                  Bureau of Health Protection Services

              	
                Provide
                  safe drinking water/Life of Project

              	
                Florida
                  Canyon Mining Inc

              
	
                Special
                  Use Permit (Buildings and Structures) 

              	
                Pershing
                  County Planning & Bldg. Dept.

              	
                Building
                  Occupancy/Life of project

              	
                Florida
                  Canyon Mining Inc

              

      

    

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    

      
        	
                STANDARD
                  MINE

              
	
                Permit/
                  Approval Name

              	
                Granting
                  Agency

              	
                Type/Expiration
                  Date

              	
                Name
                  of Permittee

              
	
                Approval
                  of Plan of Operations, Rights-of-Way Permits

              	
                Bureau
                  of Land Management

              	
                Powerline
                  Easement/ Life of Mine

              	
                Standard
                  Gold Mining Inc.

              
	
                Small
                  Quantity Hazardous Waste Generator

              	
                U.S.
                  Environmental Protection Agency

              	
                Small
                  Quantity Generator

              	
                Florida
                  Canyon Mining Inc

              
	
                Explosives
                  Permit

              	
                Bureau
                  of Alcohol, Tobacco and Firearms

              	
                Held
                  by contractor

              	 
	
                Surface
                  Disturbance and Class II Air Quality Operating Permit

              	
                Nevada
                  Bureau of Air Quality

              	
                Air
                  Pollution Control / Nov 1, 2009

              	
                Standard
                  Gold Mining Inc.

              
	
                Water
                  Pollution Control Permit

              	
                Nevada
                  Bureau of Mining Regulation and Reclamation

              	
                Mining,
                  Mineral Processing, Ancillary activities/Life of project with 5-year
                  updates/renewals

              	
                Standard
                  Gold Mining Inc.

              
	
                Reclamation
                  Permit

              	
                Nevada
                  Bureau of Mining Regulation and Reclamation

              	
                Reclamation
                  and Cost Estimate/Life of project

              	
                Standard
                  Gold Mining Inc.

              
	
                Permit
                  to Appropriate Water and to Construct Impoundments

              	
                Nevada
                  Division of Water Resources

              	
                Dams
                  and Wells/ Various lives

              	
                Standard
                  Gold Mining Inc.

              
	
                Industrial
                  Artificial Ponds

              	
                Nevada
                  Division of Wildlife

              	
                Industrial
                  Artificial Ponds/July 31, 2008

              	
                Standard
                  Gold Mining Inc.

              
	
                Solid
                  Waste Mining Site Class III Waiver

              	
                Nevada
                  Bureau of Waste Management

              	
                Municipal
                  Solid Waste Landfill (Not activated)

              	 
	
                General
                  Discharge Permit (Stormwater)

              	
                Nevada
                  Bureau of Water Pollution Control

              	
                Stormwater
                  General; Discharge Permit/July, 24, 2008

              	
                Standard
                  Gold Mining Inc.

              
	
                Hazardous
                  Materials Storage Permit

              	
                Nevada
                  State Fire Marshall

              	
                Nevada
                  Hazardous Materials Storage Permit/Febr. 28, 2006

              	
                Standard
                  Gold Mining Inc.

              

      

    

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    STOCK
      PURCHASE AGREEMENT

    

    Schedule
      4.19(a)

    Benefit
      Plans

    

    

    1.    Apollo
      Gold Employee Health Benefit Plan

     

    i.    Type:
      welfare benefit plan.

     

    ii.    Sponsorship:
      Apollo Gold.

     

    iii.    Participating
      Employer: Apollo Gold.

     

    iv.    (C)
      employee welfare benefit plan as defined in Section 3(1) of ERISA.

     

    2.    Apollo
      Gold, Inc. Cafeteria Plan

     

    
      
        i.    Type:
          Health Care Reimbursement Plan and Health Insurance Benefit components
          are
          welfare benefit plans; Dependent Care Assistance Program component is a
          fringe
          benefit plan.

      

    

     

    ii.    Sponsorship:
      Apollo Gold.

     

    iii.    Participating
      Employer: Apollo Gold.

     

    
      	 	
              iv.

            	
              Health
                Care Reimbursement Plan and Health Insurance Benefit - (C) employee
                welfare benefit plan as defined in Section 3(1) of ERISA
                .

            

    

     

    3. Apollo
      Gold Group Term Life Insurance

     

    
      	 	
              i.

            	
              Type:
                welfare benefit plan.

            

    

     

    ii.    Sponsorship:
      Apollo Gold.

     

    iii.    Participating
      Employer: Apollo Gold.

     

    
      	 	
              iv.

            	
              (C)
                employee welfare benefit plan as defined in Section 3(1) of ERISA
                .

            

    

     

    4.    Apollo
      Gold Group Long Term Disability Insurance 

     

    
      	 	
              i.

            	
              Type:
                welfare benefit plan.

            

    

     

    ii.    Sponsorship:
      Apollo Gold.

     

    iii.    Participating
      Employer: Apollo Gold.

     

    
      	 	
              iv.

            	
              (C)
                employee welfare benefit plan as defined in Section 3(1) of ERISA.
                

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    5.    Apollo
      Gold, Inc. Employee Savings Plan

     

    
      	 	
              i.

            	
              Type:
                pension benefit plan.

            

    

     

    ii.    Sponsorship:
      Apollo Gold.

     

    iii.    Participating
      Employer: Apollo Gold.

     

    
      	 	
              iv.

            	
              (B)
                plan that is or is intended to be tax qualified under Section 401(a)
                or
                403(a) of the Code, and (C) defined contribution plan as defined
                in
                Section 3(34) of ERISA or Section 414(i) of the Code.
                

            

    

     

    6.    Apollo
      Gold Stock Option Incentive Plan

     

    
      	 	
              i.

            	
              Type:
                stock option plan.

            

    

     

    ii.    Sponsorship:
      Apollo Gold.

     

    iii.    Participating
      Employer: Apollo Gold.

     

    
      	 	
              iv.

            	
              N/A

            

    

     

    

     

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    STOCK
      PURCHASE AGREEMENT

    

    Schedule
      6.7

    Software
      Licenses

    

    

    

    Florida
      Canyon Mining, Inc.

    

    Gemcom
      Geological software

    Whittle
      software

    Accpac
      Financial software

    AutoCad
      -
      2 licenses

    Jerome
      communications interface software - refinery

    N
      Star -
      new drive and man gate software

    VIMS
      PC
      ver 2003a - Caterpillar software

    Electronic
      Technician 2005a-01

    Org
      plus
      for Windows - 1 copy

    Worthit
      Fixed Assets ver 4.10

    Veritas
      Ver 9.00 rev 4367

    Veritas
      Ver 10.0 rev 5484

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    STOCK
      PURCHASE AGREEMENT

    

    Schedule
      7.3

    Employment
      Terms and Conditions

    

    This
      Schedule 7.3 contains the covenants and agreements of the parties with respect
      to employee benefits, as set forth below. References to Seller also mean the
      Guarantor.

     

    
      	1.  	
              Seller
                will take all actions necessary to cause the Companies and the Companies’
                employees to cease to participate in each Plan, as of midnight on
                the
                Closing Date, provided, however, (a) that any Company employee who
                is
                disabled on the Closing Date will remain eligible for any benefits
                for
                which the individual is eligible, or may become eligible in the future
                upon satisfying any elimination period, under any short-term or long-term
                disability plan of Seller and (b) employees with accounts under the
                Apollo
                Gold Inc. Employee Savings Plan (“Seller’s 401(k) Plan”) will remain as
                inactive participants in such plan until the transfer of assets and
                liabilities contemplated in Paragraph
                3.

            

    

     

    
      	2.  	
              Seller
                shall use its best efforts to assist the Buyer and the Companies
                in
                establishing new employee benefit programs to be maintained by the
                Companies for the benefit of employees of the Companies, including
                without
                limitation providing appropriate information and documentation to
                insurance companies and other providers. Seller shall deliver to
                the
                Companies as of the Closing Date all personnel files and records
                relating
                to the employees of the Companies as of the Closing Date, and which
                are
                not already held by the Companies. Buyer (with the assistance of
                Seller as
                necessary) will take all actions necessary to establish, effective
                as of
                12:01 a.m. on the day immediately following the Closing Date (or
                as soon
                thereafter as is administratively feasible in the case of a new 401(k)
                plan), benefits for the employees of the Companies similar to benefits
                provided under the Plans as set forth on Schedule 4.19(a)
                (but not
                including a stock option incentive plan). Nothing in this Agreement
                shall
                be construed as requiring any employee benefit plans to continue
                to be
                maintained by the Companies for any specified period after Closing.
                After
                Closing, Seller will have no liability under any plan established
                by the
                Companies pursuant to this Paragraph 3. For the avoidance of doubt,
                Seller
                will pay the cost of coverage for Florida Canyon employees and dependents
                on or before midnight of the Closing Date. Seller will also pay all
                claims
                under Seller’s health plan that are incurred by Florida Canyon employees
                and dependents and submitted by the Seller's health plan to the Seller
                for
                payment on or before midnight of the Closing Date. Buyer (or the
                Companies) will pay the cost of coverage for Florida Canyon employees
                and
                dependents after midnight of the Closing Date. Buyer (or the Companies)
                will also pay all eligible claims under Seller’s health plan (but only
                regarding Florida Canyon employees and dependents) that are submitted
                by
                the Seller’s health plan to the Seller for payment after midnight of the
                Closing Date, irrespective of when such claims were
                incurred.

            

    

     

    
      	3.  	
              Seller
                will take all actions necessary to cause a spin-off of the portion
                of
                Seller’s 401(k) Plan covering employees of the Companies (along with any
                outstanding loans) to a new 401(k) Plan to be established by the
                Companies, such spin-off to occur as soon as administratively feasible
                after Closing.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      	4.  	
              Buyer
                (or the Companies) will take all actions necessary to continue to
                provide
                continuation coverage, as required under Code Section 4980B, Part
                6 of
                Title I of ERISA or any similar state law (collectively, “COBRA”),
                following the Closing Date to any former employee of any of the Companies
                (or dependent of any employee or former employee of any of the Companies)
                whose “qualifying event” occurred on or before the Closing Date at a time
                when the individual was covered by such Plan. Seller will provide
                Buyer
                with a list of all persons currently or formerly associated with
                Florida
                Canyon who have elected continuation coverage under COBRA under the
                Seller’s health plan, and who are still in their available continuation
                period, as well as a list of all such persons whose qualifying event
                has
                occurred before Closing, and who are in their COBRA election period,
                but
                who have not yet made such election. All the foregoing persons referred
                to
                as COBRA Continuees. Seller will also provide Buyer with copies of
                all
                notices previously sent to the COBRA Continuees, and copies of all
                elections made by such COBRA Continuees, and such other information
                and
                documentation that Buyer may request in order to administer COBRA
                for the
                COBRA Continuees after Closing. Seller will provide the foregoing
                information to Buyer at least seven (7) days prior to Closing, and
                will
                update such information on the date of Closing, as
                applicable.

            

    

     

    
      	5.  	
              Seller
                will take all actions necessary to provide workers compensation coverage
                following the Closing Date to any employee or former employee of
                any
                Company which is attributable to any injury or illness that occurred
                or
                commenced on or prior to the Closing Date, excluding, however, the
                matters
                described in Schedule 4.14 under subheadings A.2 and A.3,
                for which
                Seller will indemnify Buyer (or the Companies) as provided in
                Article X of the stock purchase
                agreement.

            

    

     

    
      	6.  	
              Seller
                will take all actions necessary to cause a spin-off of the portion
                of the
                Apollo Gold, Inc. Cafeteria Plan (“Seller’s Cafeteria Plan”) covering
                employees of the Companies to a new Cafeteria Plan to be established
                by
                the Companies. Participant elections made prior to the Closing Date
                will
                continue to be effective on and after the Closing Date. Reimbursements
                made to participants under the Seller’s Cafeteria Plan from January 1,
                2005 until the Closing Date will be carried forward. Seller will
                transfer
                to Buyer an amount equal to participant contributions to the Seller’s
                Cafeteria Plan from January 1, 2005 until the Closing Date, less
                participant reimbursements during such
                period.

            

    

     

    
      	7.  	
              This
                Schedule 7.3 shall not create any third party beneficiary rights
                nor shall
                it inure to the benefit of nor shall it be enforceable by any employee
                nor
                any person representing the interests of
                employees.

            

    

     

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    STOCK
      PURCHASE AGREEMENT

    

    Schedule
      7.5

    Required
      Surety

    

    
      	 	
              1.

            	
              Personal
                Bond (BLM Bond No. NVB000328) issued by Exploration in the outstanding
                penal sum of $1,343.00 fbo United States Bureau of Land Management
                (“BLM”)
                providing financial assurance with respect to activities undertaken
                under
                Exploration’s Pirate Gold exploration permit, secured by Irrevocable
                Standby Letter of Credit No. SSB-SB-2004/0228 issued by Sterling
                Savings
                Bank (“SSB”) in the face amount of $1,343.00 for the account of
                Exploration as account party and for the benefit of (fbo) the BLM,
                all as
                amended and in effect and as further described in BLM’s determination
                letter accepting such bond dated July 16,
                2005.

            

    

    

    
      	 	
              2.

            	
              Personal
                Bond (BLM Bond No. NVB000207) issued by Exploration in the outstanding
                penal sum of $7,336.00 fbo the BLM providing financial assurance
                with
                respect to activities undertaken under Exploration’s Nugget Fields
                exploration permit, secured by Irrevocable Standby Letter of Credit
                No.
                SSB-SB-2004/0229 issued by SSB in the face amount of $7,336.00 for
                the
                account of Exploration, as account party, and fbo the BLM, all as
                amended
                and in effect and as further described in BLM’s determination letter
                accepting such bond dated July 27,
                2005.

            

    

    

    
      	 	
              3.

            	
              Personal
                Bond (BLM Bond No. NVB000514) issued by Standard in the outstanding
                penal
                sum of $138,600.00 fbo the BLM providing financial assurance with
                respect
                to activities undertaken under Standard exploration permit, secured
                by
                Irrevocable Standby Letter of Credit No. SSB-SB-2004/0232 issued
                by SSB in
                the face amount of $138,600.00 for the account of Standard, as account
                party, and fbo the BLM, all as amended and in effect and as further
                described in BLM’s determination letter accepting such bond dated August
                2, 2005.

            

    

    

    
      	 	
              4.

            	
              Personal
                Bond (BLM Bond No. NV0561) issued by Florida Canyon in the outstanding
                penal sum of $3,527,270.00 fbo the BLM providing financial assurance
                with
                respect to activities undertaken under Florida Canyon’s plan of
                operations, secured by Irrevocable Standby Letter of Credit No.
                SSB-SB-2004/0233 issued by SSB in the face amount of $3,527,270.00
                for the
                account of Florida Canyon and fbo the BLM, all as amended and in
                effect
                and as further described in BLM’s determination letter accepting such bond
                dated May 20, 2005.

            

    

    

    
      	 	
              5.

            	
              Surety
                Bond No. 6067172 (BLM Bond No. NV0672) in the outstanding penal sum
                of
                $520,000.00 issued by Safeco Insurance Company of America (“Safeco”), as
                surety, for the account of Florida Canyon, as principal, for the
                benefit
                of the BLM, as beneficiary, providing financial assurance with respect
                to
                activities undertaken under Florida Canyon’s plan of operations, as
                amended and in effect and as further described in BLM’s determination
                letter accepting such bond dated May 20,
                2005.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      	 	
              6.

            	
              Surety
                Bond No. 5806498 (BLM Bond No. NV0250) in the outstanding penal sum
                of
                $16,936,130 issued by Safeco, as surety, for the account of Florida
                Canyon, as principal, and for the benefit of the BLM, as beneficiary,
                as
                amended and in effect, providing financial assurance with respect
                to
                certain activities undertaken under Florida Canyon’s plan of operations,
                as further described in BLM’s determination letter accepting such bond
                dated May 20, 2005. Such bond provides financial assurances,
                notwithstanding its cancellation, within the area disturbed on August
                15,
                1999, in accordance with: (i) Florida Canyon’s confirmed plan of
                reorganization in the proceedings styled In
                re Pegasus Gold Corporation; and related entities,
                Debtors,
                United States Bankruptcy Court for the District of Nevada, Case Nos.
                BK-N-98-30088 GWZ through BK-N-98-30105 GWZ, inclusive, and (ii)
                the
                judgment affirmed by the proceedings styled United
                States of America, State of Nevada, and Florida Canyon Mining, Inc.,
                Appellees v. Safeco Insurance Company of America,
                Appellant, in
                the United States Court of Appeals for the Ninth Circuit, No. 02-15737
                (on
                Appeal from the United States District Court for the District of
                Nevada,
                No. CV-N-99-361-DWH (RAM), the consolidated case caption assigned
                by the
                United States District Court following consolidation with proceedings
                removed to that court from the Western District of Washington initially
                styled Safeco
                Insurance Company of America v. Florida Canyon Mining,
                Inc.,
                United States District Court for the Western District of Washington,
                Case
                No. C99 0766Z). 

            

    

    

    
      	 	
              7.

            	
              Reclamation
                Surety Bond No. ESD 732 5041 in the outstanding penal sum of $4,501,531
                issued by American Home Assurance Company (“AIG”), as surety, for the
                account of Standard, as principal, and for the benefit of the State
                of
                Nevada Department of Conservation and Natural Resources, Division
                of
                Environmental Protection (“NDEP”), as beneficiary, as amended and in
                effect, providing financial assurances for activities undertaken
                under
                Standard’s Phase I plan of operations, as further described in NDEP’s
                determination letter accepting such bond dated July 20, 2004.
                

            

    

    

    
      	 	
              8.

            	
              Safeco
                Bond No. 5798124 in the penal sum of $120,000 issued by Safeco, as
                surety,
                nominally for the account of Pegasus Gold Corporation, as account
                party,
                for the benefit of the State of Nevada, as beneficiary, as amended,
                assumed by Florida Canyon and in effect notwithstanding such bond’s
                cancellation, providing financial assurances in connection with
                Certificate of Authority No. 215 with respect to Florida Canyon’s pre-June
                30, 1999, self insured worker’s compensation program.
                

            

    

    

    
      	 	
              9.

            	
              Personal
                Bond (BLM Bond No. unknown) issued by Florida Canyon’s predecessor by
                reorganization in the penal sum of $18,119.00 fbo the BLM providing
                financial assurance with respect to activities undertaken by Florida
                Canyon, secured by a cash deposit made by Florida Canyon’s predecessor by
                reorganization directly to BLM in the amount of $18,119.00.
                

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      EXHIBIT
        A

       

      PROMISSORY
        NOTE

       

      
        	
                $2,500,000

              	
                October
                  17, 2005

              
	 	
                Denver,
                  Colorado

              
	 	 

      

      FOR
        VALUE
        RECEIVED, the undersigned (“Maker”) promises to pay to the order of Jipangu
        Inc., a Japan corporation (“Holder”), on June 1, 2006, the principal sum of Two
        Million Five Hundred Thousand Dollars ($2,500,000), plus interest thereon
        from
        December 1, 2005 at a rate of seven and three tenths percent (7.3%) per annum
        through payment in full; provided, that any amount of principal and interest
        which is not paid when due shall bear interest at the default rate of twelve
        percent (12%) per annum from the day when due through payment in full.

       

      All
        interest shall be calculated on the basis of a year of 365 days, for the
        actual
        number of days (including the first day but excluding the last day) elapsed.
        Payments shall be made in funds current and available in Tokyo, Japan, in
        lawful
        money of the United States of America, at such place as Holder may specify
        from
        time to time.

       

      Upon
        the
        occurrence of any one of the following events, all
        obligations of Maker hereunder shall become immediately due and payable without
        any action by Holder:

       

      (i) Maker
        or
        any of its subsidiaries makes an assignment for the benefit of creditors,
        or
        applies for or consents to the appointment of a receiver or trustee for it
        or
        for a substantial part of its property or business, or such a receiver or
        trustee shall otherwise be appointed; 

       

      (ii) bankruptcy,
        insolvency, reorganization or liquidation proceedings or other proceedings
        or
        relief under any bankruptcy law or any law for the relief of debtors shall
        be
        instituted by or against Maker or any of its subsidiaries; or

       

      (iii) Maker
        or
        any of its subsidiaries defaults in any payment to any third party or parties
        in
        an aggregate amount in excess of $500,000 or otherwise defaults or fails
        to
        perform in any agreement in a manner resulting in a right by any third party
        or
        parties to accelerate the maturity of any indebtedness of Maker or any of
        its
        subsidiaries in an amount in excess of $500,000;

       

      Maker
        agrees to pay all costs and expenses which Holder may incur by reason of
        any
        default, including without limitation reasonable collection costs and attorneys’
        fees with respect to legal services relating to any default and to a
        determination of any rights or remedies of Holder under this Note or under
        any
        other instrument or document made by Maker with or in favor of Holder, and
        reasonable attorneys’ fees relating to any actions or proceedings which Holder
        may institute or in which Holder may appear or participate and in any reviews
        of
        and appeals therefrom.

       

      Maker
        waives demand, presentment for payment, protest, notice of protest, and notice
        of nonpayment. Maker further agrees that any modification or extension of
        the
        terms of payment of this Note made by Holder shall not diminish or impair
        Maker’s liability for the payment hereunder and that none of the terms or
        provisions hereof may be waived, altered, modified or amended except as Holder
        may consent thereto in a writing duly signed by Holder. Holder may delay
        or
        forgo enforcing any of its rights or remedies under this Note without losing
        them.

       

      THIS
        NOTE
        SHALL BE GOVERNED BY AND CONSTRUED ACCORDING TO THE LAWS OF THE STATE OF
        COLORADO WITHOUT RESPECT TO CONFLICT OF LAW PRINCIPLES. IF A LAWSUIT IS
        COMMENCED IN CONNECTION WITH THIS NOTE, MAKER AGREES THAT EXCLUSIVE JURISDICTION
        AND VENUE FOR ANY SUCH ACTION SHALL LIE IN DENVER, COLORADO, AND MAKER AGREES,
        UPON HOLDER’S REQUEST, TO SUBMIT TO THE PERSONAL JURISDICTION OF THE STATE AND
        FEDERAL COURTS THEREIN.

       

      

      Apollo
        Gold Corporation, a Yukon corporation

       

      By: 
        

      
        
          

        

      

      Print
        Name:   

      Print
        Title:    

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

     

    EXHIBIT
      B

    
      TRANSITION
        SERVICES AGREEMENT

       

      This
        TRANSITION SERVICES AGREEMENT (this “Agreement”) is
        effective as of _____, 2005 (the “Effective Date”), and is entered into
        among Jipangu International Inc., a Delaware corporation (“Buyer”),
        Jipangu Inc., a Japanese corporation (“Buyer Parent”), Florida Canyon
        Mining, Inc., a Delaware corporation, Standard Gold Mining, Inc., a Delaware
        corporation, and Apollo Gold Exploration, Inc., a Delaware corporation (Florida
        Canyon Mining, Inc., Standard Gold Mining, Inc. and Apollo Gold Exploration,
        Inc. collectively, the “Companies”), and Apollo Gold Corporation, a
        Yukon corporation (“Seller”).

       

      WHEREAS,
        Seller, Buyer, and Buyer Parent have
        entered into a Stock Purchase Agreement, dated as of October 17, 2005 (the
        “Purchase Agreement”), pursuant to which Seller’s wholly-owned
        subsidiary, Apollo Gold, Inc., a Delaware corporation (“AGI”), has
        agreed to sell, and Buyer Parent, through its subsidiary Buyer, has agreed
        to
        purchase, all of the outstanding capital stock of the Companies;

       

      WHEREAS,
        in connection with the transactions
        contemplated by the Purchase Agreement, Seller has agreed to enter into this
        Agreement with the Companies, Buyer, and Buyer Parent to provide certain
        transition services to the Companies on the terms and conditions set forth
        in
        this Agreement.

       

      NOW,
        THEREFORE, in consideration of the mutual
        representations, warranties, and agreements contained in this Agreement,
        and for
        other good and valuable consideration, the receipt and sufficiency of which
        are
        hereby acknowledged, the parties agree as follows:

       

      1.  Definitions.
        Any term used herein that is not defined in this Agreement but is defined
        in the
        Purchase Agreement has the meaning ascribed to it in the Purchase
        Agreement.

       

      2.  Transition
        Services. Seller will provide the transition services described below
        (the “Transition Services”) to the Companies during the term of this
        Agreement: 

       

      (a)  Seller
        Services. On the terms and subject to the conditions of this Agreement,
        Seller will provide the services to the Companies listed on Schedule A, in
        substantially the same scope, nature and manner as was provided to the Companies
        (or to AGI with respect to the Companies) immediately prior to the Effective
        Date.

       

      (b)  Third
        Party Services. On the terms and subject to the conditions of this
        Agreement, Seller will use commercially reasonable efforts to assist the
        Companies in procuring the services listed on Schedule B to be provided to
        the
        Companies, in substantially the same scope, nature and manner as was provided
        to
        the Companies (or to AGI with respect to the Companies) immediately prior
        to the
        Effective Date by the providers that provided such services to the Companies
        (or
        to AGI with respect to the Companies) immediately prior to the Effective
        Date
        (“Third Party Services”). The Companies and the Buyer acknowledge that
        the provision of Third Party Services may require the consent of the relevant
        providers. If the Companies, with Seller’s assistance, are unable to obtain such
        consent with respect to a particular Third Party Service, then the Seller,
        at no
        additional cost to Seller, will use commercially reasonable efforts to assist
        the Companies in arranging for an alternative person or an alternative
        methodology to provide the Third Party Service.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (c)  Other
        Services. During the term of this Agreement, and subject to availability of
        Seller’s resources, Seller will provide to the Companies any other transition
        services not referenced in subsection (a) or (b) above of a nature that is
        consistent with the services Seller provided to the Companies (or to AGI
        with
        respect to the Companies) prior to the Effective Date, at levels consistent
        with
        the past operation of the Companies (or of AGI with respect to the Companies)
        and reasonably requested by the Companies. Seller shall render such additional
        Transition Services following the parties’ agreeing in writing to the services
        to be provided with reasonably sufficient detail. Any fee to be charged by
        Seller for any services provided pursuant to this Section 2(c) will be equal
        to
        the costs and allocations Seller previously charged to the Companies for
        such
        Transition Services prior to the Effective Date, and including without
        limitation allocable overhead and Seller’s out-of-pocket expenses incurred
        consistent with past practice (“Seller’s Costs”). At the Buyer’s or the
        Companies’ request, Seller will furnish the Buyer or the Companies, as the case
        may be, with reasonable supporting documentation evidencing Seller’s Costs
        hereunder. 

       

      (d)  Increased
        Staffing. If Seller is required to increase staffing, acquire equipment or
        to make any investments or capital expenditures in order to increase the
        level
        of use of any Transition Service provided as a result of a request by the
        Companies to increase the level of use provided by Seller, Seller shall inform
        the Companies in writing of the need for such increases in staffing level,
        acquisitions of equipment, investments or capital expenditure required before
        any such costs or expenses are incurred. Upon the receipt of such notice,
        the
        Companies may (i) withdraw their request for the increase in the level of
        use
        provided by Seller, (ii) in the case of equipment or other tangible assets,
        make
        the required equipment and assets available for Seller’s use during the
        provision of the Transition Services at no expense to Seller, or (iii) agree
        to
        Seller’s increased staffing, acquisition of equipment or investment or capital
        expenditure. Upon mutual written agreement under subsection (iii), as to
        any
        such increase in staffing level, acquisition of equipment, investment or
        capital
        expenditure required, the Companies shall reimburse Seller for the actual
        increased costs and expenses incurred by Seller allocable to the Transition
        Services. If the Companies do not agree to reimburse Seller for the actual
        increased costs and expenses to be incurred, Seller shall have no obligation
        to
        increase the level of such Transition Service.

       

      (e)  Segregation
        of Data or Systems. If any costs and expenses are required to segregate data
        or systems of the Companies from data or systems of Seller prior to termination
        of this Agreement, the Companies shall reimburse Seller for the costs and
        expenses of such segregation; provided, however, that Seller shall not undertake
        any such segregation without providing to the Companies a written estimate
        of
        the costs of such segregation and obtaining the prior written consent of
        the
        Companies thereto.

       

      (f)  No
        Modification of Seller’s Software or Equipment. Except as agreed in writing
        by the parties, Seller shall not be required to perform any Transition Service
        requiring the use of, and shall not be required to install or use, any software
        or equipment modified or provided by the Companies. Seller shall not be required
        to modify or change any of Seller’s software or equipment to perform any
        Transition Service.

       

      
        
          
          

        

        
          -2-

          
            

          

        

        
          
          

        

      

       

      (g)  Seller
        Representative. Seller shall designate in writing a representative (the
“Seller Representative”) who shall have the authority to act on Seller’s behalf
        in connection with the performance of the Transition Services, to enforce
        the
        provisions of this Agreement, and to serve as the primary contact for
        communications between the Companies and Seller concerning the performance
        of
        the Transition Services and this Agreement. Before any limitation placed
        by
        Seller on the authority of the Seller Representative may be effective, such
        limitation shall first be disclosed to the Companies in writing, and if not
        so
        disclosed, shall not have any effect.

       

      (h)  Companies’
        Representative. The Companies shall designate in writing a representative
        (the “Companies’ Representative”). The Companies’ Representative shall have the
        authority, on behalf of the Companies, to enforce the provisions of this
        Agreement, to take any action necessary to cause or promote the orderly and
        expeditious performance of the Transition Services, and to serve as the primary
        contact for communications between Seller and the Companies concerning the
        performance of the Transition Services. Before any limitation placed by the
        Companies on the authority of the Companies’ Representative may be effective,
        such limitation shall first be disclosed to Seller in writing, and if not
        so
        disclosed, shall not have any effect.

       

      (i)  No
        Violation of Law or Contract. Notwithstanding any of the provisions of this
        Agreement to the contrary, Seller shall not be required to provide any
        Transition Service which Seller is prohibited from providing by law or
        contractual restriction. Nothing in this Agreement shall require Seller to
        violate any agreement with any third party, including, without limitation,
        any
        software license or agreement. Seller certifies that, to its knowledge, the
        provision of the Transition Services will not cause it to violate any law
        or
        contractual restriction.

       

      (j)  Buyer
        to Receive Benefit. Seller agrees that any Transition Service to be provided
        to the Companies will instead be provided to the Buyer with respect to the
        Companies, if so requested by the Companies’ Representative.

       

      3.  Compensation.
        

       

      (a)  Payments.
        The Companies will pay the amounts listed on Schedule A, the amounts listed
        on
        Schedule B or Seller’s Costs, as applicable, for the Transition Services. Seller
        will invoice the Companies one month following the date of this Agreement,
        and
        on the same day of each month thereafter in which Transition Services have
        been
        rendered under this Agreement. If the invoice date is the 29th,
        30th or 31st day of the month, any invoice to be sent
        during a month with fewer than such number of days shall instead be sent
        on the
        last day of such month. The Companies will pay all invoices in full by no
        later
        than thirty days following the date of receipt. In the event the Companies
        do
        not pay all due and payable invoices in full within thirty days of receipt
        of
        the applicable invoices, Buyer or Buyer Parent, each jointly and severally
        a
        guarantor for the Companies, shall make such payment to Seller within five
        days.
        If Seller does not receive payment within 35 days, Seller may suspend all
        Transition Services without any further liability to the Companies, Buyer,
        or
        Buyer Parent.

       

      
        
          
          

        

        
          -3-

          
            

          

        

        
          
          

        

      

       

      (b)  Taxes.
        All payments by the Companies, Buyer, or Buyer Parent to Seller under this
        Agreement shall be grossed-up by the Companies, Buyer, or Buyer Parent, as
        the
        case may be, to cover any sales tax, value-added tax, goods and services
        tax or
        similar tax (but excluding any tax based upon the net income of Seller) payable
        with respect to the provision by Seller of Transition Services. Any sales,
        use,
        transaction, excise or similar tax imposed on or measured by the rendering
        of
        the Transition Services will be the responsibility of the Companies. 

       

      4.  Independent
        Contractor. 

       

      (a)  Independent
        Contractor Status. Seller will perform the Transition Services under this
        Agreement as an independent contractor and as such will have and maintain
        exclusive control over all its own employees, agents, subcontractors and
        operations. Seller will not be, act as, purport to act as or be deemed to
        be any
        of the Companies’ agent, representative, employee or servant. 

       

      (b)  Seller’s
        Employees. Seller shall retain the absolute right to reassign, discipline or
        dismiss any Seller employee or the employee of any affiliate or third party
        retained by the Seller and the Companies shall not purport to exercise any
        such
        right, provided that at any time the Companies may require Seller to cause
        an
        employee to cease to provide Transition Services to the Companies and leave
        any
        premises owned or occupied by the Companies if the Companies in their reasonable
        discretion so request. Notwithstanding the foregoing, if the Companies’ request
        for Seller to cause an employee to cease to provide Transition Services results
        in Seller’s inability to perform the Transition Services, Seller shall not have
        any liability to the Companies for failure to perform such Transition
        Services.

       

      (c)  No
        Requirement for New Employees. Seller is not required to hire any new
        employees to provide Transition Services to the Companies during the term
        of
        this Agreement. If Seller is unable to provide Transition Services to the
        Companies hereunder, Seller shall notify the Companies of such fact as promptly
        as practicable. Notwithstanding the foregoing, subject to Section 2(b) above,
        Seller may, but shall not be obligated to, hire a third party vendor to perform
        the Transition Services. In the event a third party vendor is hired, the
        provisions of this Agreement shall remain in full force and effect as to
        the
        Transition Services to be provided by the third party vendor. 

       

      5.  Standard
        of Performance. 

       

      (a)  For
        Transition Services provided directly by Seller, Seller will perform such
        Transition Services in a reasonably timely and competent manner and provide
        Transition Services in a nature and at levels consistent with the Companies’
        past and current conduct of their business and AGI’s past conduct with respect
        to the Companies’ business. For Transition Services provided by third parties,
        Seller, at no additional cost to Seller, will use reasonable efforts to procure
        or secure such services hereunder. Notwithstanding the foregoing:

       

      (i)
        Seller shall not be liable to the Companies, Buyer, Buyer Parent,
        or any third party on account of any action or inaction on the part of any
        Seller employee, any employee of a Seller affiliate or any third party, so
        long
        as the individual in question was acting in good faith in accordance with
        or
        pursuant to the direction of the Companies; and

       

      
        
          
          

        

        
          -4-

          
            

          

        

        
          
          

        

      

       

      (ii)
        Seller shall not be liable to the Companies, Buyer or Buyer
        Parent for any error of judgment or for any loss suffered by the Companies,
        Buyer or Buyer Parent or any third party in connection with the subject matter
        of this Agreement (howsoever any such loss may have occurred);

       

      unless,
        such loss arises from gross negligence, bad faith, fraud,
        intentional misconduct or willful default in the performance or non-performance
        by Seller, any Seller employee or any employee of any Seller affiliate of
        the
        Transition Services provided under or pursuant to the terms of this Agreement.
        In addition, nothing herein shall obligate Seller to incur direct out-of-pocket
        costs or expenses for which Seller will not be reimbursed or compensated
        under
        this Agreement, even if such failure to incur costs or expenses or assume
        obligations would interfere with Seller’s ability to provide Transition
        Services. The allocable portion of employees’ salaries and corporate overhead
        shall not be considered direct out-of-pocket costs or expenses.

       

      (b) SELLER
        MAKES NO REPRESENTATION AND EXTENDS NO WARRANTY OF
        ANY KIND, EXPRESS OR IMPLIED, REGARDING THE TRANSITION SERVICES OR ITS
        PERFORMANCE UNDER THIS AGREEMENT, AND DISCLAIMS ALL WARRANTIES, INCLUDING
        WITHOUT LIMITATION THE WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
        PURPOSE, AND NON-INFRINGEMENT.

       

      6.  Confidentiality.
        

       

      (a)  Seller
        and its affiliates will keep confidential and protect, and will not divulge,
        allow access to or use in any way, (i) intellectual property rights, including
        product specifications, formulae, compositions, processes, designs, sketches,
        photographs, graphs, drawings, samples, inventions and ideas, past, current
        and
        planned research and development, current and planned manufacturing and
        distribution methods and processes, market studies, business plans, software,
        database technologies, systems, structures, architectures and data (and related
        processes, formulae, compositions, improvements, devices, know-how, inventions,
        discoveries, concepts, ideas, designs, methods and information), (ii) any
        and
        all information concerning the business and affairs (including historical
        financial statements, financial projections and budgets, historical and
        projected sales, capital spending budgets and plans, the names and backgrounds
        of key personnel, personnel training and techniques and materials), however
        documented, and (iii) any and all notes, analyses, compilations, studies,
        summaries and other material containing or based, in whole or in part, on
        any
        information included in the foregoing (collectively, “Confidential Information”)
        of Buyer, Buyer Parent or any Company that is delivered or made available
        to
        Seller or its affiliates pursuant to this Agreement, unless required by (x)
        applicable law, (y) any judgment, injunction, writ, order, ruling, award
        or
        decree made by any governmental or judicial authority or arbitration, or
        (z)
        policies or rules of stock exchanges on which the shares of Seller or any
        affiliate are listed, in which event, if legally permissible, Seller shall
        promptly provide written notice to Buyer to allow Buyer or any Company to
        seek
        (and if only Seller or any affiliate is legally permitted to seek, they will,
        if
        requested by Buyer seek) (at the expense of Buyer or any Company) a protective
        order with respect to such information. Seller acknowledges that such
        Confidential Information constitutes a unique and valuable asset of each
        Company, Buyer and Buyer Parent and represents a substantial investment of
        time
        and expense by such Company, Buyer and Buyer Parent, and that any disclosure
        or
        other use of such Confidential Information other than for the sole benefit
        of
        such Company, Buyer or Buyer Parent would be wrongful and would cause
        irreparable harm to such Company, Buyer or Buyer Parent. Seller will deliver
        promptly to the Companies, Buyer or Buyer Parent or destroy, at the request
        and
        option of the Companies, Buyer or Buyer Parent, all tangible and intangible
        embodiments (and all copies) of such Confidential Information that are in
        the
        possession of Seller or its affiliates. The foregoing obligations of
        confidentiality will not apply to any Confidential Information that is or
        subsequently becomes generally publicly known, other than as a direct or
        indirect result of the breach of this Agreement by Seller.

       

      
        
          
          

        

        
          -5-

          
            

          

        

        
          
          

        

      

       

      (b)  Seller
        acknowledges that the Companies, Buyer and Buyer Parent have required that
        Seller make the agreements in this Section 6 as a condition to Buyer’s purchase
        of the Companies and consummation of the transactions contemplated by this
        Agreement. Seller agrees that the agreements contained in this Section 6
        are
        reasonable and necessary to protect the legitimate interests of the Companies,
        Buyer and Buyer Parent and that any violation or breach of this Section 6
        will
        result in irreparable injury to the Companies, Buyer and Buyer Parent for
        which
        no adequate remedy would exist at law. Accordingly, in addition to any relief
        at
        law that may be available to any Company, Buyer or Buyer Parent for such
        violation or breach and regardless of any other provision contained in this
        Agreement, each Company, Buyer and Buyer Parent will be entitled to injunctive
        and other equitable relief restraining such violation or breach (without
        any
        requirement that any Company, Buyer or Buyer Parent provide any bond or other
        security).

       

      (c)  In
        the event that Seller or any affiliate is requested or required (by oral
        question or request for information or documents in any legal proceeding,
        interrogatory, subpoena, civil investigative demand or similar process) to
        disclose any Confidential Information, it will notify the Buyer promptly
        of the
        request or requirement so that the Companies, Buyer and Buyer Parent may
        seek an
        appropriate protective order or waive compliance with the provisions of this
        Section 6. If, in the absence of a protective order or the receipt
        of a
        waiver from Companies, Buyer and Buyer Parent, the Seller is, on the advice
        of
        counsel, compelled to disclose any Confidential Information to any tribunal
        or
        else stand liable for contempt, Seller may disclose the Confidential Information
        to the tribunal; provided, however, that Seller will use its reasonable
        efforts to obtain, at the request of any Company, Buyer or Buyer Parent,
        an
        order or other assurance that confidential treatment will be accorded to
        such
        portion of the Confidential Information required to be disclosed as the Company,
        Buyer or Buyer Parent designates.

       

      7.  Indemnification.
        TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, THE COMPANIES,
        BUYER,
        AND BUYER PARENT SHALL JOINTLY AND SEVERALLY INDEMNIFY, DEFEND AND HOLD SELLER
        HARMLESS, ITS AFFILIATES AND THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES,
        AGENTS, CONTRACTORS AND SUBCONTRACTORS FROM AND AGAINST ANY AND ALL CLAIMS,
        COSTS OR LIABILITIES OF ANY KIND OR NATURE WHATSOEVER (“CLAIMS”), ARISING OUT OF
        THE PERFORMANCE OF THE TRANSITION SERVICES HEREUNDER, EXCEPT IN THE CASE
        OF SUCH
        PARTY’S GROSS NEGLIGENCE, BAD FAITH, FRAUD, INTENTIONAL MISCONDUCT OR WILLFUL
        DEFAULT.

       

      
        
          
          

        

        
          -6-

          
            

          

        

        
          
          

        

      

       

      8.  Terms
        and Termination.

       

      (a)  The
        term of this Agreement will commence on the Effective Date and continue until
        all Transition Services are completed, unless earlier terminated in accordance
        with this Section 8.

       

      (b)  The
        Companies may terminate this Agreement in whole or with respect to any one
        or
        more Transition Services at any time without cause upon one week’s written
        notice. Such termination will not extinguish the Companies’ or the Buyer’s
        obligation to pay for Transition Services or costs incurred by Seller under
        this
        Agreement prior to the effective date of such termination.

       

      (c)  If
        any party hereto becomes bankrupt or insolvent, or makes an assignment for
        the
        benefit of creditors, or if a receiver is appointed to take charge of its
        property and such proceeding is not vacated or terminated within thirty days
        after its commencement or institution, any other party may immediately terminate
        this Agreement by written notice. Any such termination will be without prejudice
        to accrued rights of the terminating parties, and to other rights and remedies
        for default. 

       

      9.  Miscellaneous.

       

      (a)  Force
        Majeure. No party will be liable in any manner for failure or delay of
        performance of all or part of this Agreement (other than the payment of money),
        directly or indirectly, owing to acts of God, applicable orders or restrictions
        by a governmental authority, strikes or other labor disturbances, riots,
        embargoes, power failures, telecommunication line failures, revolutions,
        wars,
        fires, floods, or any other causes of circumstances beyond the reasonable
        control of the parties. The affected party, however, in the case of such
        delay
        or failure, will give prompt notice to the other parties and will exert
        commercially reasonable efforts to remove the causes or circumstances of
        nonperformance with reasonable dispatch. In any such event, Seller’s obligations
        hereunder and the Companies’ obligations to pay for any Transition Services so
        suspended or delayed hereunder shall be postponed for such time as Seller’s
        performance is suspended or delayed on account thereof.

       

      (b)  Entire
        Agreement. This Agreement (including the schedules referred to herein)
        contains the entire understanding between the parties with respect to Transition
        Services and supersedes any prior understandings, agreements or representations,
        written or oral, relating to the subject matter hereof.

       

      (c)  Counterparts.
        This Agreement may be executed in separate counterparts, each of which will
        be
        an original and all of which taken together will constitute one and the same
        agreement, and any party hereto may execute this Agreement by signing any
        such
        counterpart.

       

      (d)  Severability.
        Whenever possible, each provision of this Agreement will be interpreted in
        such
        a manner as to be effective and valid under applicable law but if any provision
        of this Agreement is held to be invalid, illegal or unenforceable under any
        applicable law or rule, the validity, legality and enforceability of the
        other
        provision of this Agreement will not be affected or impaired thereby.

       

      
        
          
          

        

        
          -7-

          
            

          

        

        
          
          

        

      

       

      (e)  Assignment.
        This Agreement and the rights and obligations of the parties hereunder will
        not
        be assignable, in whole or in part, by any party without the prior written
        consent of the other parties.

       

      (f)  Modification,
        Amendment, Waiver or Termination. No provision of this Agreement may be
        modified, amended, waived or terminated except by an instrument in writing
        signed by the parties to this Agreement. No course of dealing between the
        parties will modify, amend, waive or terminate any provision of this Agreement
        or any rights or obligations of any party under or by reason of this
        Agreement.

       

      (g)  Notices.
        All notices, consents, requests, instructions, approvals or other communications
        provided for herein will be in writing and delivered by personal delivery,
        overnight courier, mail, electronic facsimile or e-mail addressed to the
        receiving party at the address set forth herein. All such communications
        will be
        effective when received.

       

      
        
          	
                  If
                    to Company:

                   

                  Florida
                    Canyon Mining, Inc.

                  P.O.
                    Box 330

                  Imlay,
                    Nevada

                  USA
                    89418

                  Attn:
                    Mine General Manager

                  Facsimile
                    No. (775) 538-7324

                   

                
	
                  With
                    a copy to:

                   

                  Jipangu
                    International Inc.

                  3-6-9-
                    Kita-Shinagawa

                  Shinagawa-ku

                  Tokyo
                    140-0001

                  Japan

                  Attn:
                    President

                  Facsimile
                    No. +813 3474-4679

                   

                  and
                    with a copy to:

                   

                  Dorsey
&
                    Whitney LLP

                  1420
                    Fifth Avenue, Suite 3400

                  Seattle,
                    Washington

                  USA
                    98101

                  Attn:
                    Randal R. Jones

                  Facsimile
                    No. (206) 903-8820

                   

                  and
                    with a copy to:

                   

                  Davis
&
                    Company LLP

                  Suite
                    2800 Park Place

                  666
                    Burrard Street

                  Vancouver,
                    British Columbia

                  Canada
                    V6C 2Z7

                  Attn:
                    John M. Sibley

                  Facsimile
                    No. (604) 605-3725

                   

                

        

         

        
          
            
            

          

          
            -8-

            
              

            

          

          
            
            

          

        

         

        
          	
                  If
                    to Seller:

                   

                  Apollo
                    Gold Corporation

                  5655
                    South Yosemite Street

                  Suite
                    200

                  Greenwood
                    Village, Colorado

                  USA
                    80111-3220

                  Attn:
                    President

                  Facsimile
                    No. (720) 482-0957

                   

                
	
                  With
                    a copy to:

                   

                  Davis,
                    Graham & Stubbs LLP

                  1550
                    Seventeenth Street

                  Suite
                    500

                  Denver,
                    Colorado

                  USA
                    80202

                  Attn:
                    Deborah Friedman

                  Facsimile
                    No. (303)
                    893-1379

                

        

      

      

      Any
        party may change the address set forth above by notice to each
        other party given as provided herein.

       

      (h)  Headings.
        The headings contained in this Agreement are for reference purposes only
        and
        will not in any way affect the meaning or interpretation of this
        Agreement.

       

      (i)  Governing
        Law. ALL MATTERS RELATING TO THE INTERPRETATION, CONSTRUCTION,
        VALIDITY AND ENFORCEMENT OF THIS AGREEMENT WILL BE GOVERNED BY THE INTERNAL
        LAWS
        OF THE STATE OF DELAWARE, WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW PROVISIONS
        THEREOF.

       

      (j)  Third-Party
        Benefit. Nothing in this Agreement, express or implied, is intended to
        confer upon any other person any rights, remedies, obligations or liabilities
        of
        any nature whatsoever.

       

      (k)  Jurisdiction
        and Venue. THIS AGREEMENT MAY BE ENFORCED IN ANY FEDERAL COURT OR
        STATE COURT SITTING IN NEVADA, AND EACH PARTY CONSENTS TO THE JURISDICTION
        AND
        VENUE OF ANY SUCH COURT AND WAIVES ANY ARGUMENT THAT VENUE IN SUCH FORUM
        IS NOT
        CONVENIENT. IF ANY PARTY COMMENCES ANY ACTION UNDER ANY TORT OR CONTRACT
        THEORY
        ARISING DIRECTLY OR INDIRECTLY FROM THE RELATIONSHIP CREATED BY THIS AGREEMENT
        IN ANOTHER JURISDICTION OR VENUE, ANY OTHER PARTY TO THIS AGREEMENT WILL
        HAVE
        THE OPTION OF TRANSFERRING THE CASE TO THE ABOVE-DESCRIBED VENUE OR JURISDICTION
        OR, IF SUCH TRANSFER CANNOT BE ACCOMPLISHED, TO HAVE SUCH CASE DISMISSED
        WITHOUT
        PREJUDICE.

       

      
        
          
          

        

        
          -9-

          
            

          

        

        
          
          

        

      

       

      (l)  Waiver
        of Jury Trial. EACH PARTY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO
        TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS
        AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

       

      (m)   Remedies.
        Absent gross negligence, bad faith, fraud, intentional misconduct, willful
        default or a breach of Section 6, (i) Seller’s sole liability, and the Buyer’s
        and the Companies’ exclusive remedy, arising under this Agreement and any claim
        related to the performance or non-performance of Transition Services hereunder,
        shall be limited to the amount of payments actually made by the Buyer or
        the
        Companies in relation to the particular Transition Services on which the
        Buyer’s
        or the Companies’ claim is based, and (ii) in no event shall Seller’s aggregate
        liability hereunder exceed that aggregate service fees received from the
        Buyer
        or the Companies hereunder. IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR
        ANY
        LOST DATA OR SERVICES, LOST PROFITS, BUSINESS INTERRUPTION OR FOR ANY INDIRECT,
        INCIDENTAL, SPECIAL, CONSEQUENTIAL, EXEMPLARY OR PUNITIVE DAMAGES ARISING
        OUT OF
        OR RELATING TO THE TRANSITION SERVICES OR THIS AGREEMENT, EVEN IF ADVISED
        OF THE
        POSSIBILITY OF SUCH DAMAGES.

       

      (n)  Expenses.
        Except as otherwise expressly provided for herein, each party will pay its
        own
        expenses (including brokers’, finders’, attorneys’ and accountants’ fees) in
        connection with the negotiation of this Agreement, the performance of its
        respective obligations hereunder and the consummation of the transactions
        contemplated by this Agreement (whether consummated or not).

       

      (o)  Advice
        of Counsel. Each party acknowledges that it has been advised by counsel in
        the negotiation, execution and delivery of this agreement.

       

      (p)  No
        Waiver. No delay on the part of the parties in exercising any right
        hereunder will operate as a waiver of such right. No waiver, express or implied,
        by either party of any right of such party or any breach by the other party
        will
        constitute a waiver of any other of such party’s right or breach by the other
        party.

       

      
        
          
          

        

        
          -10-

          
            

          

        

        
          
          

        

      

      IN
        WITNESS WHEREOF, the parties hereto caused this
        Transition Services Agreement to be duly executed by their respective authorized
        officers as of the day and year first above written.

       

      
        	
                APOLLO
                  GOLD CORPORATION

                 

                 

                By:__________________________________________________

                Name:________________________________________________

                Title:_________________________________________________

                 

              	 	
                JIPANGU
                  INTERNATIONAL INC.

                 

                By:__________________________________________________

                Name:________________________________________________

                Title:_________________________________________________

                 

                FLORIDA
                  CANYON MINING, INC.

                 

                 

                By:__________________________________________________

                Name:________________________________________________

                Title:_________________________________________________

              
	 	 	
                 

                 

                 

                STANDARD
                  GOLD MINING, INC.

                 

                 

                By:__________________________________________________

                Name:________________________________________________

                Title:_________________________________________________

                 

                APOLLO
                  GOLD EXPLORATION, INC.

                 

                 

                By:__________________________________________________

                Name:________________________________________________

                Title:_________________________________________________

              

      

      

      
 

      
        
          
          

        

        
          -11-

          
            

          

        

        
          
          

          
          

        

      

      SCHEDULE
        A

       

      Seller’s
        Services

       

      Transition
        Team:

      

      Seller’s
        transition team will initially consist of the following
        employees with their respective areas of responsibilities:

      

      1.
        R. David Russell - Seller’s Representative

      2.
        Melvyn Williams - financial, accounting, and auditing

      3.
        Richard Nanna - exploration group advisor

      4.
        Don Miller - human resources and administration

      5.
        Dave Young - mine operations, technical support, permitting, and
        bonding

       

      
        	
                Transition
                  Services

              	 	
                Compensation

              	 	
                Duration

              
	
                1.
                  Seller shall assist the Companies with gold sales consistent with
                  past and
                  current practice.

              	 	
                No
                  additional charge. (1)

              	 	
                3
                  months

              
	
                2.
                  Seller shall assist the Companies with treasury management, cash
                  control
                  management and control of the internal and external audit functions
                  consistent with past practice, and shall assist the Companies in
                  addressing those significant deficiencies and material weaknesses
                  that
                  Seller’s independent accountants have identified in the internal control
                  over financial reporting relating to the Subsidiaries and their
                  business.

              	 	
                No
                  additional charge. (1)

              	 	
                3
                  months

                 

              
	
                3.
                  Seller shall assist in the administration to the Companies’ employees of
                  all benefit and compensation plans and a 401(k) plan consistent
                  with past
                  practice.

              	 	
                No
                  additional charge. (1)

              	 	
                3
                  months

              
	
                4.
                  Seller shall advise in the administration of the Companies’ reserve data
                  base and any required reserve/resource calculations, consistent
                  with past
                  practice.

              	 	
                No
                  additional charge. (1)

              	 	
                3
                  months

              
	
                5.
                  Seller shall advise in preparing and seeking approval of APO 19,
                  Florida
                  Canyon trust fund and new Standard permitting for a period of 3
                  months,
                  with continuing assistance after the first 3 months as needed and
                  mutually
                  agreed to by the parties.

              	 	
                No
                  additional charge. (1)

              	 	
                3
                  months; potentially extendable

              
	
                6.
                  If any position that reports directly to the Mine General Manager
                  is not
                  filled with a permanent employee on the Effective Date (a “Vacant
                  Position”), Seller shall use its reasonable efforts to assist the
                  Companies in filling such position as soon as reasonably practicable
                  with
                  a candidate, and on terms, reasonably satisfactory to the
                  Companies.

              	 	
                No
                  additional charge. (1)

              	 	
                Until
                  completed

              
	
                7.
                  If any Vacant Position exists on the Effective Date, Seller will
                  provide
                  the Companies with the services of a member of the transition team,
                  who
                  will serve in the Vacant Position until the earlier of 3 months
                  after the
                  Effective Date or the date on which a new permanent employee is
                  hired to
                  fill the Vacant Position, but only to the extent that such service
                  does
                  not unreasonably interfere with that transition team member’s job
                  responsibilities to Seller.

              	 	
                No
                  additional charge. (1)

              	 	
                3
                  months or until completed, whichever is earlier

              
	
                8.
                  Seller shall provide guidance, training, information and assistance
                  to the
                  newly-hired Mine General Manager, Engineering Manager, Controller
                  and any
                  other position filled pursuant to paragraph 6 above, consistent
                  with
                  Seller’s past practice with respect to new hires in like
                  positions.

              	 	
                No
                  additional charge. (1)

              	 	
                3
                  months

              
	
                9.
                  Seller shall provide guidance to the Companies with respect to
                  human
                  resources issues such as pay, benefits, unions, labor law and
                  recruiting.

              	 	
                No
                  additional charge. (1)

              	 	
                3
                  months

              
	
                10.
                  While providing the services described above, Seller shall use
                  reasonable
                  efforts in assisting the Companies to become self-sufficient in
                  such
                  matters within 3 months after the date of this Agreement.

              	 	
                No
                  additional charge. (1)

              	 	
                3
                  months

              
	 	 	 	 	 
	 	 	 	 	 

      

      
        
          

        

      

      (1)
        Notwithstanding anything to the contrary in this Agreement, the Companies,
        and
        Buyer and Buyer Parent as guarantors, shall be reimburse Seller for all usual
        and customary documented expenses for travel, lodging, and meals, up to a
        maximum of $10,000 per month for the duration of this Agreement. Any additional
        out-of-pocket expenses must be approved by the Companies in writing prior
        to
        being incurred.

       

      

      

      

       

      
        
          
          

        

        
          A-1

          
            

          

        

        
          
          

          
          

        

      

       

      SCHEDULE
        B

       

      Third
        Party Services

       

      
        	
                Transition
                  Service

              
	
                 

                1.Gemcom
                  Geological Software (annual maintenance contract)

                 

                2.
                  Whittle Software

                 

                3.
                  AccPac Financial Software

                 

                4.
                  US Bank - Draft Trust Agreement FC - BLM

                 

                5.
                  Marsh Insurance Brokerage

                 

                6.
                  Fidelity - 401k Plan Administrator

                 

                7.
                  Scotia Bank (ScotiaMoccata) - Gold Sales Agreement

                 

                8.
                  IT Services -Phone Service: Vartec (800) 871-0999

                 

                9.
                  Price Waterhouse Coopers

                 

                10.
                  Bond support or guaranty arrangements with AIG, Sterling Savings
                  Bank and
                  Safeco

              

      

      

      
        
          
          

        

        
          B-1

          
            

          

        

        
          
          

        

      

    

     

    
       

      EXHIBIT
        C

      

      
        	To:	
                Boards
                  of Directors of Florida Canyon Mining, Inc., Standard Gold Mining,
                  Inc.
                  and Apollo Gold Exploration, Inc. (each, a “Company”,
                  and collectively, the “Companies”),
                  P.O. Box 330, Imlay, Nevada, USA
                  89418

              

      

      

      
        	And
                to:	
                Jipangu
                  Inc. and Jipangu International Inc., 3-6-9 Kita-Shinagawa, Shinagawa-ku,
                  Tokyo 140-0001 Japan

              

      

      

      

      __________,
        2005

       

      Dear
        Sirs,

       

      I
        hereby
        resign as a director and/or officer of the Companies, and from any other
        position that I might hold with the Companies, as applicable, as of the date
        hereof and I irrevocably waive my rights to any notice, contractual or
        otherwise.

       

      In
        consideration for One Hundred Dollars ($100) in lawful currency of the United
        States and other good and valuable consideration received from the Companies,
        I
        irrevocably release the Companies, their Boards of Directors, officers,
        employees, agents and assigns, from all and any claims, charges, complaints,
        causes of action or demands of whatever kind or nature (1) that I now have
        or
        have ever had against any Company, whether known or unknown, arising from
        or
        relating to my service to the Companies, including but not limited to: wrongful
        or tortious termination, specifically including actual or constructive
        termination in violation of public policy; implied or express employment
        contracts and/or estoppel; discrimination, harassment, failure to accommodate
        and/or retaliation under any federal, state, provincial or local statute
        or
        regulation, specifically including any claims I may have under the Fair Labor
        Standards Act, the Americans with Disabilities Act, Title VII of the Civil
        Rights Act of 1964 as amended, and the Family and Medical Leave Act; the
        applicable laws and regulations of the State of Nevada and the state, province
        or other jurisdiction in which I reside; any claims brought under any federal,
        state, provincial or local statute or regulation for non-payment of wages
        or
        other compensation (including expense reimbursements and/or bonuses due after
        the date hereof); negligent hiring, retention and training; any claims arising
        from either tort or contract laws; any claims brought under any federal,
        state,
        provincial or local statute or regulation related to military leave and/or
        reinstatement or related rights; and libel, slander, fraud, misrepresentation,
        or breach of contract; and any claims for indemnification or advancement
        of
        expenses under the Companies’ certificates of incorporation or bylaws, under the
        Delaware General Corporation Law or under any agreement to which I am a party
        or
        a beneficiary; or (2) that I might in the future have against any Company
        for
        indemnification under the Companies’ certificates of incorporation or bylaws,
        under the Delaware General Corporation Law or under any agreement to which
        I am
        a party or a beneficiary). I further confirm that the Companies are in no
        way
        obligated or indebted to me in connection with my position as a director
        or
        officer of any Company or otherwise.

      
        	 	 
	SIGNED
                as
                a deed and delivered by	)
	[NAME]    in
                the	)
	presence
                of:	)
	 	 

      

      Witness
        Signature:

      

      Witness
        Name:

      

      Witness
        Address:

      

      Witness
        Occupation:

       

       

      
        
          
          

        

        
          C-1

          
            

          

        

        
          
          

        

      

    

     

    EXHIBIT
      D

    
      CERTIFICATE
        OF SELLER’S NON-FOREIGN STATUS

       

      Section 1445
        of the Internal Revenue Code provides that a transferee of a U.S. real property
        interest must withhold tax if the transferor is a foreign person. To inform
        the
        transferee that withholding of tax is not required upon the disposition of
        the
        U.S. real property interest by Apollo Gold, Inc., the undersigned hereby
        certifies the following on behalf of Apollo Gold, Inc.:

       

      1.    Apollo
        Gold, Inc. is not a foreign corporation, foreign partnership, foreign trust,
        or
        foreign estate (as those terms are defined in the Internal Revenue Code and
        Income Tax Regulations);

       

      2.    Apollo
        Gold, Inc. is not a disregarded entity as defined in Treas. Reg. §
        1.1445-2(b)(2)(iii);

       

      3.    Apollo
        Gold, Inc.’s U.S. employer identification number is 91-1724754; and

       

      4.    Apollo
        Gold, Inc.’s office address is 5655 South Yosemite Street

       

      Suite
        200, Greenwood Village, Colorado, USA 80111-3220.

       

      Apollo
        Gold, Inc. understands that this certification may be disclosed to the Internal
        Revenue Service by the transferee and that any false statement contained
        herein
        could be punished by fine, imprisonment, or both.

       

      Under
        penalties or perjury I declare that I have examined this certification and
        to
        the best of my knowledge and belief it is true, correct and complete, and
        I
        further declare that I have authority to sign this document on behalf of
        Apollo
        Gold, Inc..

       

      
        Apollo
          Gold, Inc., a Delaware corporation

         

        By:_________________________________________

        Name:_______________________________________

        Title:________________________________________

         

        Date:________________________________________

         

         

        
          
            
            

          

          D-1

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