Document:

Filed by sedaredgar.com - Trans-Orient Petroleum Ltd. - Exhibit 10.1

EXECUTION COPY

ARRANGEMENT AGREEMENT

between 

TAG OIL LTD. 

and 

TAG ACQUISITION CORP. 

and 

TRANS-ORIENT PETROLEUM LTD.

September 14, 2009

TABLE OF CONTENTS

	ARTICLE
      ONE DEFINITIONS, INTERPRETATION AND SCHEDULE 	2
      
	 	Section
      1.01 	Definitions
      	2
      
	 	Section
      1.02 	Interpretation
      Not Affected by Headings 	7
      
	 	Section
      1.03 	Number,
      Gender and Persons 	7
      
	 	Section
      1.04 	Date
      for any Action 	7
      
	 	Section
      1.05 	Statutory
      References 	7
      
	 	Section
      1.06 	Currency
      	7
      
	 	Section
      1.07 	Invalidity
      of Provisions 	7
      
	 	Section
      1.08 	Accounting
      Matters 	7
      
	 	Section
      1.09 	Knowledge
      	8
      
	 	Section
      1.10 	Schedule
      	8
      
	 	  	  	  
	ARTICLE
      TWO THE ARRANGEMENT 	8
      
	 	Section
      2.01 	Arrangement
      	8
      
	 	Section
      2.02 	Effective
      Date 	8
      
	 	Section
      2.03 	Consultation
      	8
      
	 	Section
      2.04 	Court
      Proceedings 	9
      
	 	Section
      2.05 	Pre-closing
      	9
      
	 	Section
      2.06 	Arrangement
      Filings 	9
      
	 	Section
      2.07 	Trans-Orient
      Options and Trans-Orient Warrants 	10
      
	 	Section
      2.08 	Certain
      Matters 	10
      
	 	  	  	  
	ARTICLE
      THREE REPRESENTATIONS AND WARRANTIES 	10
      
	 	Section
      3.01 	Representations
      and Warranties of Trans-Orient 	10
      
	 	Section
      3.02 	Representations
      and Warranties of TAG 	20
      
	 	Section
      3.03 	Survival
      of Representations and Warranties 	30
      
	 	  	  	  
	ARTICLE
      FOUR COVENANTS 	30
      
	 	Section
      4.01 	Covenants
      of Trans-Orient 	30
      
	 	Section
      4.02 	Covenants
      of TAG 	36
      
	 	Section
      4.03 	Additional
      Covenants of TAG 	41
      
	 	Section
      4.04 	Successors
      	41
      
	 	Section
      4.05 	Merger
      of Covenants 	41
      
	 	  	  	  
	ARTICLE
      FIVE CONDITIONS 	41
      
	 	Section
      5.01 	Mutual
      Conditions 	41
      
	 	Section
      5.02 	Trans-Orient
      Conditions 	43
      
	 	Section
      5.03 	TAG
      and TAG Subco Conditions 	44
      
	 	Section
      5.04 	Notice
      and Cure Provisions 	45
      
	 	Section
      5.05 	Merger
      of Conditions 	45
      
	 	  	  	  
	ARTICLE
      SIX NON-SOLICITATION AND BREAK-UP FEE 	46
      
	 	Section
      6.01 	Mutual
      Covenants Regarding Non-Solicitation 	46
      
		Section
      6.02 	Notice
      by the Involved Party of Superior Proposal Determination; Right to Match
      	47
      
	 	Section
      6.03 	Break
      Fee Event 	48
      
	 	  	  	  
	ARTICLE
      SEVEN AMENDMENT AND TERMINATION 	49
      

- ii -

TABLE OF CONTENTS
(Continued)

	 	Section
      7.01 	Amendment
      	49
      
	 	Section
      7.02 	Termination
      	49
      
	 	  	  	  
	ARTICLE
      EIGHT GENERAL 	50
      
	 	Section
      8.01 	Notices
      	50
      
	 	Section
      8.02 	Remedies
      	51
      
	 	Section
      8.03 	Expenses
      	51
      
	 	Section
      8.04 	Time
      of the Essence 	52
      
	 	Section
      8.05 	Entire
      Agreement 	52
      
	 	Section
      8.06 	Further
      Assurances 	52
      
	 	Section
      8.07 	Governing
      Law 	52
      
	 	Section
      8.08 	Execution
      in Counterparts 	52
      
	 	Section
      8.09 	Waiver
      	52
      
	 	Section
      8.10 	No
      Personal Liability 	52
      
	 	Section
      8.11 	Enurement
      and Assignment 	53
      
	 	  	  	  
	Schedule “A” – Plan of Arrangement 	  
	 	  
	Appendix A – Amalgamation Application 	  
	 	  
	Schedule “B” – Form of Lock-Up Agreement 	  

ARRANGEMENT AGREEMENT

                   
THIS AGREEMENT made as of the 14th day of September, 2009

B E T W E E N:

TAG OIL LTD., a corporation
existing under the
Business Corporations Act (British Columbia)

 (hereinafter sometimes referred
to as “TAG”)

OF THE FIRST PART

- and -

TAG ACQUISITION CORP., a
corporation existing 
under the Business Corporations Act (British
Columbia),

 (hereinafter sometimes referred
to as “TAG Subco”)

OF THE SECOND PART

- and -

TRANS-ORIENT PETROLEUM LTD., a
corporation 
existing under the Business Corporations Act (British

Columbia), 

(hereinafter sometimes referred to as
“Trans-Orient”)

OF THE THIRD PART

WITNESSES THAT:

                   
WHEREAS TAG Subco is a corporation wholly-owned by TAG; 

                    AND
WHEREAS TAG, TAG Subco and Trans-Orient propose to effect a business
combination to combine the business and assets of Trans-Orient with those of
TAG;

                    AND
WHEREAS the parties hereto intend to carry out the proposed business
combination by way of a plan of arrangement under the provisions of the
Business Corporations Act (British Columbia);

                    NOW
THEREFORE in consideration of the mutual covenants and agreements herein
contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by each of the parties hereto, the
parties hereto hereby covenant and agree as follows:

- 2 -

ARTICLE ONE
DEFINITIONS, INTERPRETATION AND
SCHEDULE

	Section 1.01 	Definitions 

In this Agreement, unless the context otherwise requires, the
following words and terms with the initial letter or letters thereof capitalized
shall have the meanings ascribed to them below:

	 	(a) 	
      “Acquisition Proposal” means, in respect of TAG or
      Trans-Orient, any inquiry or proposal (other than an inquiry or proposal
      made with respect to the Arrangement) regarding (i) any merger,
      amalgamation, consolidation, share exchange, business combination or other
      similar transaction or series of related transactions involving TAG or
      Trans-Orient, respectively, (ii) any sale, lease, exchange, transfer or
      other disposition of all or any material portion of the assets of TAG (on
      a consolidated basis) or Trans- Orient (on a consolidated basis),
      respectively, (iii) any tender offer, take-over bid, exchange offer or
      similar transaction by any person involving the acquisition of securities
      of TAG or Trans-Orient, respectively, (iv) any recapitalization,
      reorganization, liquidation, material sale or issue of treasury securities
      or rights or interests therein or thereto or rights or options to acquire
      any material number of treasury securities or any type of similar
      transaction which would or could constitute a de facto change in
      control of TAG or Trans-Orient, respectively, or (v) any other similar
      transaction or series of related transactions which would or could
      constitute a de facto change in control of TAG or Trans-Orient,
      respectively, or which would or could hinder the consummation of the
      transactions contemplated by, or otherwise defeat the purpose of, this
      Agreement;

	 	 	 
	 	(b) 	
      “Agreement” means this arrangement agreement, together
      with the schedules attached hereto, as amended or supplemented from time
      to time;

	 	 	 
	 	(c) 	
      “Amalgamating Corporations” means TAG Subco and
      Trans-Orient collectively;

	 	 	 
	 	(d) 	
      “Arrangement” means the arrangement under the provisions
      of Division 5 of Part 9 of the BCBCA on the terms and conditions set forth
      in the Plan of Arrangement, subject to any amendment or supplement thereto
      made in accordance therewith or made at the direction of the Court in the
      Final Order;

	 	 	 
	 	(e) 	
      “Arrangement Filings” means the filings in respect of the
      Arrangement required by the BCBCA to be filed with the Registrar after the
      Final Order is made to effect the Arrangement in accordance with the terms
      hereof and the terms of the Final Order;

	 	 	 
	 	(f) 	
      “BCBCA” means the Business Corporations Act
      (British Columbia);

	 	 	 
	 	(g) 	
      “Business Day” means any day, other than a Saturday, a
      Sunday or a statutory holiday in Vancouver, British Columbia;

	 	 	 
	 	(h) 	
      “Canadian GAAP” means generally accepted accounting
      principles in Canada;

	 	 	 
	 	(i) 	
      “Certificate” means a certificate signed by a senior
      officer of each of TAG Subco and Trans-Orient formally giving effect to
      the Arrangement;

	 	 	 
	 	(j) 	
      “Cheal Acquisition” has the meaning provided in Section
      5.02(g) of this Agreement;

- 3 -

	 	(k) 	
      “Code” means the United States Internal Revenue Code
      of 1986, as amended, any successor thereto, and any Law interpretative
      thereof collectively;

	 	 	 
	 	(l) 	
      “Completion Deadline” means the date by which the
      transactions contemplated by this Agreement are to be completed, which
      date shall be December 31, 2009;

	 	 	 
	 	(m) 	
      “Confidentiality Agreement” means the agreement dated
      August 13, 2009 between TAG and Trans-Orient;

	 	 	 
	 	(n) 	
      “Court” means the British Columbia Supreme
  Court;

	 	 	 
	 	(o) 	
      “Effective Date” means the date set out in the
      Certificate as being the effective date in respect of the
    Arrangement;

	 	 	 
	 	(p) 	
      “Effective Time” means 12:01 a.m. (Vancouver time) on the
      Effective Date;

	 	 	 
	 	(q) 	
      “Encumbrance” includes any mortgage, pledge, assignment,
      charge, lien, claim, security interest, adverse interest, other third
      person interest or encumbrance of any kind, whether contingent or
      absolute, and any agreement, option, right or privilege (whether by law,
      contract or otherwise) capable of becoming any of the foregoing;

	 	 	 
	 	(r) 	
      “Environmental Laws” means, with respect to any Person or
      its business, activities, property, assets or undertaking, all Laws,
      including the common law, relating to environmental or health matters in
      the jurisdictions applicable to such Person or its business, activities,
      property, assets or undertaking, including legislation governing the use
      and storage of Hazardous Substances;

	 	 	 
	 	(s) 	
      “Final Order” means the order of the Court, as such order
      may be amended at any time prior to the Effective Date, pursuant to
      subsection 288(2)(b) of the BCBCA approving the Arrangement or, if
      appealed, then unless such appeal is withdrawn or denied, as
    affirmed;

	 	 	 
	 	(t) 	
      “Governmental Entity” means any applicable (i)
      multinational, federal, provincial, state, regional, municipal, local or
      other government, governmental or public department, central bank, court,
      tribunal, arbitral body, commission, board, bureau or agency, domestic or
      foreign, (ii) any subdivision, agency, commission, board or authority of
      any of the foregoing, or (iii) any quasi-governmental or private body
      exercising any regulatory, expropriation or taxing authority under or for
      the account of any of the foregoing;

	 	 	 
	 	(u) 	
      “Hazardous Substances” mean any pollutant, contaminant,
      waste of any nature, hazardous substance, hazardous material, hazardous
      recyclable, toxic substance, dangerous substance or dangerous good as
      defined, judicially interpreted, or identified in any Environmental
      Laws;

	 	 	 
	 	(v) 	
      “Interim Order” means the interim order of the Court, as
      such order may be amended, pursuant to subsection 288(2)(b) of the BCBCA
      made in connection with the Arrangement;

	 	 	 
	 	(w) 	
      “Laws” means all laws, by-laws, rules, regulations,
      orders, ordinances, protocols, codes, guidelines, instruments, policies,
      notices, directions and judgments or other requirements of any
      Governmental Entity;

- 4 -

	 	(x) 	
      “Lock-up Agreements” means the agreements dated the date
      hereof between TAG and each of the directors and officers of Trans-Orient,
      Alex Guidi, Lukas Lundin and Peter Loretto pursuant to which each of them
      has agreed to comply with covenants consistent with those of Trans-Orient
      set forth in Section 6.01 hereof and vote his Trans-Orient Common Shares
      at the Trans-Orient Meeting in favour of the Arrangement, which agreements
      will be substantially in the form attached hereto as Schedule B;

	 	 	 
	 	(y) 	
      “Material Adverse Change” means, in respect of TAG or
      Trans-Orient, any one or more changes, events or occurrences, and
      “Material Adverse Effect” means, in respect of TAG or Trans-Orient, any
      state of facts, which, in either case, either individually or in the
      aggregate, are, or would reasonably be expected to be, material and
      adverse to the business, assets or financial condition of TAG and the TAG
      Subsidiaries, or Trans-Orient and the Trans-Orient Subsidiaries,
      respectively, on a consolidated basis provided that a Material Adverse
      Change or Material Adverse Effect shall not include any change or effect
      (whether alone or in combination with, any other effect), directly or
      indirectly, arising out of, relating to, resulting from or reasonably
      attributable to the announcement of this Agreement or the pendency of
      completion of the transactions contemplated herein, changes in the economy
      of the United States or Canada generally, in the oil and gas industry
      generally or in the capital markets generally or any matter that has been
      disclosed to the public or the other parties hereto prior to the date of
      this Agreement;

	 	 	 
	 	(z) 	
      “OTCBB” means the Over-the-Counter Bulletin
  Board;

	 	 	 
	 	(aa) 	
      “Person” includes an individual, firm, trust,
      partnership, association, corporation, joint venture, trustee, executor,
      administrator, legal representative or government (including any
      Governmental Entity);

	 	 	 
	 	(bb) 	
      “Plan of Arrangement” means a plan of arrangement
      substantially in the form and content of Schedule A attached hereto and
      any amendment or variation thereto made in accordance with Section 7.02 of
      the Plan of Arrangement or Section 7.01 hereof;

	 	 	 
	 	(cc) 	
      “Proxy Circular” means the management information
      circular to be prepared by Trans- Orient for the Trans-Orient
    Meeting;

	 	 	 
	 	(dd) 	
      “Registrar” means the Registrar of Companies appointed
      pursuant to Section 400 of the BCBCA;

	 	 	 
	 	(ee) 	
      “Securities Authorities” means the securities regulatory
      authorities in the jurisdictions of Canada and the United States in which
      TAG or Trans-Orient is a reporting issuer or its equivalent, as the case
      may be;

	 	 	 
	 	(ff) 	
      “Subsidiary” means, with respect to a specified body
      corporate, any body corporate of which the specified body corporate is
      entitled to elect a majority of the directors thereof and shall include
      any body corporate, partnership, joint venture or other entity over which
      it exercises direction or control or which is in a like relation to such a
      body corporate, excluding any body corporate in respect of which such
      direction or control is not exercised by the specified body corporate as a
      result of existing contracts, agreements and commitments, and, in the case
      of TAG, includes the TAG Subsidiaries and, in the case of Trans-Orient,
      includes the Trans-Orient Subsidiaries;

	 	 	 
	 	(gg) 	
      “Superior Proposal” means, in respect of TAG or
      Trans-Orient, an unsolicited bona fide written Acquisition Proposal
      in respect of TAG or Trans-Orient, respectively, which
  the

- 5 -

	 		
      directors of TAG or Trans-Orient, respectively, have
      determined in good faith, after consultation with, and receiving advice
      (which may include written opinions, a copy of which shall have been
      provided to Trans-Orient or TAG, respectively) from, as appropriate, the
      financial, legal and other advisors to TAG or Trans-Orient, respectively,
      to the effect that such Acquisition Proposal (a) is reasonably capable of
      being completed without undue delay, taking into account all financial,
      legal, regulatory and other aspects of such proposal and the party making
      such proposal, (b) is fully financed or reasonably capable of being fully
      financed, and (c) would, if consummated in accordance with the terms
      thereof (but without assuming away the risk of non-completion), result in
      a transaction more favourable from a financial point of view to the TAG
      Shareholders or the Trans-Orient Shareholders, respectively, than the
      Arrangement;

	 	 	 
	 	(hh) 	
      “TAG” means TAG Oil Ltd., a corporation existing under
      the BCBCA;

	 	 	 
	 	(ii) 	
      “TAG Common Shares” means the common shares in the
      capital of TAG;

	 	 	 
	 	(jj) 	
      “TAG Disclosure Documents” means documents filed by or on
      behalf of TAG that are publicly available in electronic form on the System
      for Electronic Document Analysis and Retrieval, commonly known as
      “SEDAR”;

	 	 	 
	 	(kk) 	
      “TAG Disclosure Letter” means the letter dated the date
      hereof from TAG to Trans- Orient;

	 	 	 
	 	(ll) 	
      “TAG Shareholders” means the holders of TAG Common Shares
      at the applicable time;

	 	 	 
	 	(mm) 	
      “TAG Subco” means TAG Acquisition Corp., a wholly-owned
      subsidiary of TAG existing under the BCBCA;

	 	 	 
	 	(nn) 	
      “TAG Subsidiaries” means TAG Subco, Cheal Petroleum
      Limited, TAG Oil (NZ) Limited and TAG Oil (Canterbury) Limited;

	 	 	 
	 	(oo) 	
      “Tax” and “Taxes” means, with respect to any person, all
      taxes, assessments, charges, dues, duties, rates, fees, imposts, levies
      and similar charges of any kind lawfully levied, assessed or imposed by
      any Governmental Entity, including (i) all income taxes (including any tax
      on or based upon net income, gross income, income as specially defined,
      earnings, profits or selected items of income, earnings or profits) and
      all capital taxes, gross receipts taxes, environmental taxes, sales taxes,
      use taxes, ad valorem taxes, value added taxes, transfer taxes
      (including, without limitation, taxes relating to the transfer of
      interests in real property or entities holding interests therein),
      franchise taxes, licence taxes, withholding taxes, payroll taxes,
      employment taxes, Canada or Québec Pension Plan premiums, excise,
      severance, social security, workers’ compensation, employment insurance or
      compensation, stamp taxes, occupation taxes, premium taxes, property
      taxes, windfall profits taxes, alternative or add-on minimum taxes, goods
      and services tax, customs duties or other taxes, fees, imports,
      assessments or charges of any kind whatsoever, together with any interest
      and any penalties or additional amounts imposed by any taxing authority
      (domestic or foreign) on such entity, and any interest, penalties,
      additional taxes and additions to tax imposed with respect to the
      foregoing, (ii) any transferee liability (within the meaning of Section
      6901 of the Code or any other applicable Law), and (iii) any liability
      with respect to any member of a consolidated, combined or unitary group of
      which the person (or any predecessor) is or was a member on or prior to
      the Effective Date by reason of the liability of the person pursuant to
      United States Treasury Regulation Section 1.1502-6 or any analogous or
      similar Law;

- 6 -

	 	(pp) 	
      “Tax Act” means the Income Tax Act
  (Canada);

	 	 	 
	 	(qq) 	
      “Tax Returns” means all returns, schedules, elections,
      declarations, reports, information returns and statements required to be
      filed with any taxing authority relating to Taxes;

	 	 	 
	 	(rr) 	
      “Trans-Orient” means Trans-Orient Petroleum Ltd., a
      corporation existing under the BCBCA;

	 	 	 
	 	(ss) 	
      “Trans-Orient Common Shares” means the common shares in
      the capital of Trans-Orient;

	 	 	 
	 	(tt) 	
      “Trans-Orient Disclosure Documents” means documents filed
      by or on behalf of Trans- Orient that are publicly available in electronic
      form on the System for Electronic Document Analysis and Retrieval,
      commonly known as “SEDAR”;

	 	 	 
	 	(uu) 	
      “Trans-Orient Disclosure Letter” means the letter dated
      the date hereof from Trans- Orient to TAG;

	 	 	 
	 	(vv) 	
      “Trans-Orient Meeting” means the special meeting,
      including any adjournments or postponements thereof, of the Trans-Orient
      Shareholders to be held, among other things, to consider and, if deemed
      advisable, to approve the Arrangement;

	 	 	 
	 	(ww) 	
      “Trans-Orient Options” means the outstanding options to
      purchase Trans-Orient Common Shares issued pursuant to the Trans-Orient
      Stock Option Plan;

	 	 	 
	 	(xx) 	
      “Trans-Orient Stock Option Plan” means the stock option
      plan of Trans-Orient in existence as of the date hereof;

	 	 	 
	 	(yy) 	
      “Trans-Orient Shareholders” means the holders of
      Trans-Orient Common Shares at the applicable time;

	 	 	 
	 	(zz) 	
      “Trans-Orient Subsidiaries” means DLJ Management Corp.,
      Eastern Petroleum (NZ) Limited, Orient Petroleum (NZ) Limited and Orient
      Petroleum (PNG) Limited;

	 	 	 
	 	(aaa) 	
      “Trans-Orient Warrants” means the 200,000 warrants to
      acquire 200,000 common shares at a price of US$0.80 per share until expiry
      on June 24, 2010;

	 	 	 
	 	(bbb) 	
      “TSX-V” means the TSX Venture Exchange;

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

	 	 	 
	 	(ddd) 	
      “1934 Act” means the Securities Exchange Act of
      1934, as amended, of the United States of America; and

	 	 	 
	 	(eee) 	
      “1940 Act” means the Investment Company Act of
      1940, as amended, of the United States of
America.

In addition, words and phrases used herein and defined in the
BCBCA shall have the same meaning herein as in the BCBCA unless the context
otherwise requires.

- 7 -

	Section 1.02 	Interpretation Not Affected by Headings
    

The division of this Agreement into articles, sections,
subsections, paragraphs and subparagraphs and the insertion of headings herein
are for convenience of reference only and shall not affect in any way the
meaning or interpretation of this Agreement. The terms “this Agreement”,
“hereof”, “herein”, “hereto”, “hereunder” and similar expressions refer to this
Agreement and the schedule attached hereto and not to any particular article,
section or other portion hereof and include any agreement, schedule or
instrument supplementary or ancillary hereto or thereto.

	Section 1.03 	Number, Gender and Persons

In this Agreement, unless the context otherwise requires, words
importing the singular only shall include the plural and vice versa,
words importing the use of either gender shall include both genders and neuter
and the word person and all words importing persons shall include a natural
person, firm, trust, partnership, association, corporation, joint venture or
government (including any governmental agency, political subdivision or
instrumentality thereof) and any other entity of any kind or nature
whatsoever.

	Section 1.04 	Date for any Action 

If the date on which any action is required to be taken
hereunder by any party hereto is not a Business Day, such action shall be
required to be taken on the next succeeding day which is a Business Day.

	Section 1.05 	Statutory References

Any reference in this Agreement to a statute includes all
regulations and rules made thereunder, all amendments to such statute or
regulation in force from time to time and any statute or regulation that
supplements or supersedes such statute or regulation.

	Section 1.06 	Currency 

Unless otherwise stated, all references in this Agreement to
amounts of money are expressed in lawful money of Canada.

	Section 1.07 	Invalidity of Provisions

Each of the provisions contained in this Agreement is distinct
and severable and a declaration of invalidity or unenforceability of any such
provision or part thereof by a court of competent jurisdiction shall not affect
the validity or enforceability of any other provision hereof. To the extent
permitted by applicable Law, the parties hereto waive any provision of law which
renders any provision of this Agreement or any part thereof invalid or
unenforceable in any respect. The parties hereto will engage in good faith
negotiations to replace any provision hereof or any part thereof which is
declared invalid or unenforceable with a valid and enforceable provision or part
thereof, the economic effect of which approximates as much as possible the
invalid or unenforceable provision or part thereof which it replaces.

	Section 1.08 	Accounting Matters 

Unless otherwise stated, all accounting terms used in this
Agreement shall have the meanings attributable thereto under Canadian GAAP and
all determinations of an accounting nature required to be made hereunder shall
be made in a manner consistent with Canadian GAAP.

- 8 -

	Section 1.09 	Knowledge 

Where the phrase “to the knowledge of TAG” or “to the knowledge
of Trans-Orient” is used, such phrase shall mean, in respect of each
representation and warranty or other statement which is qualified by such
phrase, that such representation and warranty or other statement is being made
based upon, in the case of TAG, the collective knowledge of the directors and
officers of TAG and the TAG Subsidiaries and, in the case of Trans-Orient, the
collective knowledge of the directors and officers of Trans-Orient and the
Trans-Orient Subsidiaries and, in either case, “knowledge” means the actual
knowledge of such directors and officers after reasonable inquiry (which shall
not require any new third party audits or studies or require any enquiries of
third parties).

	Section 1.10 	Schedule 

The following schedules are attached to, and are deemed to be
incorporated into and form part of, this Agreement:

	Schedule 	           
               Matter 
	A 	Plan of Arrangement 
	B 	Form of Lock-up Agreement

ARTICLE TWO 
THE ARRANGEMENT

	Section 2.01 	Arrangement 

The Amalgamating Corporations agree to amalgamate by way of
arrangement pursuant to Division 5 of Part 9 of the BCBCA on the terms and
subject to the conditions contained in this Agreement and the Plan of
Arrangement and TAG hereby covenants and agrees to issue the TAG Common Shares
required to be issued in connection with the Arrangement.

	Section 2.02 	Effective Date 

The Arrangement shall become effective at the Effective Time on
the Effective Date and at such time the Amalgamating Corporations shall
amalgamate and continue as one corporation on the terms and subject to the
conditions contained in this Agreement and the Plan of Arrangement.

	Section 2.03 	Consultation 

TAG and Trans-Orient agree to consult with the other of them in
issuing any press release or otherwise making any public statement with respect
to this Agreement or the Arrangement and in making any filing with any federal,
provincial or state governmental or regulatory agency or with any securities
commission or stock exchange with respect thereto. Each of TAG and Trans-Orient
shall use its commercially reasonable efforts to enable the other of them to
review and comment on all such press releases and filings prior to the release
or filing, respectively, thereof. TAG and Trans-Orient agree to issue a press
release with respect to this Agreement as soon as practicable, in a form
acceptable to each of them. Each of TAG and Trans-Orient acknowledges that this
Agreement may be required to be filed concurrently with the filing of a material
change report under applicable securities legislation and may be included as a
schedule to the Proxy Circular.

- 9 -

	Section 2.04 	Court Proceedings 

As soon as is reasonably practicable after the date of
execution of this Agreement, Trans-Orient and TAG Subco shall apply to the Court
pursuant to Division 5 of Part 9 of the BCBCA for an order approving the
Arrangement and, in connection with such application, Trans-Orient, TAG and TAG
Subco shall:

	 	(a) 	
      file, proceed with and diligently prosecute an
      application to the Court for the Interim Order providing for, among other
      things, the calling and holding of the Trans-Orient Meeting for the
      purpose of considering and, if deemed advisable, approving the
      Arrangement; and

	 	 	 
	 	(b) 	
      subject to the terms of this Agreement and compliance by
      the directors and officers of Trans-Orient with their fiduciary duties,
      and obtaining the approvals as contemplated by the Interim Order and as
      may be directed by the Court in the Interim Order, take all steps
      necessary or desirable to submit the Arrangement to the Court, and apply,
      for the Final Order.

The notice of motion and related materials for the applications
referred to in this section shall be in a form satisfactory to Trans-Orient, TAG
and TAG Subco, each acting reasonably, and, in the case of the application to
the Court for the Interim Order, shall request that the Interim Order provide,
among other things:

	 	(c) 	
      for the persons to whom notice is to be provided in
      respect of the Arrangement and the Trans-Orient Meeting and for the manner
      in which such notice is to be provided; and

	 	 	 
	 	(d) 	
      that the requisite approval of the Trans-Orient
      Shareholders for the Arrangement shall be two-thirds of the votes cast
      thereon by Trans-Orient Shareholders present in person or represented by
      proxy at the Trans-Orient Meeting; and

	 	 	 
	 	(e) 	
      for the grant of rights of dissent as provided in the
      Plan of Arrangement.

	Section 2.05 	Pre-closing 

Unless this Agreement is terminated pursuant to the provisions
hereof, TAG and Trans-Orient shall meet at the offices of Blake, Cassels &
Graydon LLP, 595 Burrard Street, Suite 2600, Vancouver, British Columbia at 9:00
a.m. on the day before the Effective Date or at such other time or on such other
date as they may mutually agree upon and each of them shall deliver to the other
of them:

	 	(a) 	
      the documents required or contemplated to be delivered by
      it hereunder to complete the transactions contemplated hereby, provided
      that each such document required to be dated the Effective Date shall be
      dated as of, or become effective on, the Effective Date and shall be held
      in escrow to be released upon the Arrangement becoming effective;
    and

	 	 	 
	 	(b) 	
      written confirmation as to the satisfaction or waiver of
      all of the conditions in its favour contained in this
  Agreement.

	Section 2.06 	Arrangement Filings 

Subject to the rights of termination contained in Article Seven
hereof, upon the Trans-Orient Shareholders approving the Arrangement in
accordance with the Interim Order, Trans-Orient obtaining the Final Order and
the other conditions contained in Article Five hereof being complied with or
waived, the Amalgamating Corporations shall jointly file the Arrangement
Filings, with the Registrar together with such other documents as may be
required in order to effect the Arrangement.

- 10 -

	Section 2.07 	Trans-Orient Options and Trans-Orient
      Warrants 

Trans-Orient Options and Trans-Orient Warrants shall be
exercisable to subscribe for TAG Common Shares after the Effective Time in
accordance with their respective terms. TAG shall execute all documents and
instruments necessary including replacement certificates if necessary in order
to give effect to the foregoing.

	Section 2.08 	Certain Matters 

	 	(a) 	
      TAG and Trans-Orient agree that, upon the completion of
      the Arrangement, the board of directors of TAG shall be reconstituted such
      that 3 of the members are individuals who are nominees of Trans-Orient who
      are not already on the board of TAG, which nominees are expected to be
      Ronald Bertuzzi, Michael Hart and Barry MacNeil.

	 	 	 
	 	(b) 	
      In furtherance of Section 2.08(a), and in the event that
      on the Effective Time there are not 3 vacancies on the TAG board of
      directors, at or as soon as practicable following the Effective Time TAG
      shall either increase by 3 the number of directors comprising the board of
      directors and/or secure the resignations of directors of TAG, so as to
      cause the nominees of Trans-Orient to be elected or appointed as directors
      of TAG, provided that they are qualified to act as directors under
      applicable Laws.

ARTICLE THREE 
REPRESENTATIONS AND WARRANTIES

	Section 3.01 	Representations and Warranties of
      Trans-Orient 

Trans-Orient hereby represents and warrants to TAG and TAG
Subco, and hereby acknowledges that each of TAG and TAG Subco is relying upon
such representations and warranties in connection with entering into this
Agreement and agreeing to complete the Arrangement, as follows:

	 	(a) 	
      Organization. Trans-Orient and each of the
      Trans-Orient Subsidiaries has been incorporated, is validly subsisting and
      has full corporate power and authority to own its property and assets and
      conduct its business as currently owned and conducted. Trans- Orient and
      each of the Trans-Orient Subsidiaries is registered, licensed or otherwise
      qualified as an extra-provincial corporation or a foreign corporation in
      each jurisdiction where the nature of the business or the location or
      character of the property and assets owned or leased by it requires it to
      be so registered, licensed or otherwise qualified, other than those
      jurisdictions where the failure to be so registered, licensed or otherwise
      qualified would not have a Material Adverse Effect on Trans-Orient. All of
      the outstanding shares of the Trans-Orient Subsidiaries are validly
      issued, fully paid and non- assessable. All of the outstanding shares of
      the Trans-Orient Subsidiaries are owned directly or indirectly by
      Trans-Orient. Except pursuant to restrictions on transfer contained in the
      articles or by-laws (or their equivalent) of the applicable Trans-Orient
      Subsidiary, the shares of each Trans-Orient Subsidiary which are owned by
      Trans-Orient (or by another Trans-Orient Subsidiary) are owned free and
      clear of all Encumbrances. There are no outstanding options, rights,
      entitlements, understandings or commitments (contingent or otherwise)
      regarding the right to acquire any securities of any Trans-Orient
      Subsidiary from either Trans-Orient or any other Trans-Orient
      Subsidiary.

	 	 	 
	 	(b) 	
      Capitalization. Trans-Orient is authorized to
      issue an unlimited number of preferred shares, issuable in series, and an
      unlimited number of Trans-Orient Common Shares. As at September 11, 2009,
      there were nil preferred shares and 36,595,225
  Trans-Orient

- 11 -

	 		
      Common Shares outstanding and an aggregate of 1,725,000
      Trans-Orient Common Shares were set aside for issue under Trans-Orient
      Options and Trans-Orient Warrants. Except as described in the immediately
      preceding sentence, there are no options, warrants, conversion privileges
      or other rights, agreements, arrangements or commitments (pre-emptive,
      contingent or otherwise) obligating Trans-Orient or any of the
      Trans-Orient Subsidiaries to issue or sell any shares of Trans-Orient or
      any of the Trans-Orient Subsidiaries or any securities or obligations of
      any kind convertible into or exchangeable for any shares of Trans-Orient
      or any of the Trans-Orient Subsidiaries, nor are there outstanding any
      share appreciation rights, phantom equity or similar rights, agreements,
      arrangements or commitments based upon the book value, income or any other
      attribute of Trans-Orient or any of the Trans-Orient Subsidiaries. All
      outstanding Trans-Orient Common Shares have been authorized and are
      validly issued and outstanding as fully paid and non-assessable shares,
      free of pre-emptive rights. There are no outstanding bonds, debentures or
      other evidences of indebtedness of Trans-Orient or any of the Trans-Orient
      Subsidiaries having the right to vote with the Trans-Orient Shareholders
      on any matter. There are no outstanding contractual obligations of Trans-
      Orient or of any of the Trans-Orient Subsidiaries to repurchase, redeem or
      otherwise acquire any outstanding Trans-Orient Common Shares or with
      respect to the voting or disposition of any outstanding Trans-Orient
      Common Shares.

	 	 	 	 	 
	 	(c) 	
      Authority. Trans-Orient has the requisite
      corporate power and authority to enter into this Agreement and to perform
      its obligations hereunder. The execution and delivery of this Agreement by
      Trans-Orient and the completion by Trans-Orient of the transactions
      contemplated by this Agreement have been authorized by the directors of
      Trans-Orient (conditional upon receipt of a favourable opinion from
      Trans-Orient’s independent financial advisor that the exchange ratio for
      the Arrangement is fair, from a financial point of view, to the
      Trans-Orient Shareholders) and, subject to approval by the Trans- Orient
      Shareholders in the manner contemplated herein, no other corporate
      proceedings on the part of Trans-Orient are necessary to authorize this
      Agreement or to complete the transactions contemplated hereby other than
      in connection with the approval by the directors of Trans-Orient of the
      Proxy Circular. This Agreement has been executed and delivered by
      Trans-Orient and constitutes a legal, valid and binding obligation of
      Trans- Orient, enforceable against Trans-Orient in accordance with its
      terms, subject to bankruptcy, insolvency, reorganization, fraudulent
      transfer, moratorium and other applicable Laws relating to or affecting
      creditors’ rights generally, and to general principles of equity. The
      execution and delivery of this Agreement, the performance of the
      provisions hereof and the completion of the transactions contemplated
      hereby do not and will not:

	 	 	 	 	 
	 		(i) 	
      result in a violation or breach of, require any consent
      to be obtained under or give rise to any termination rights under any
      provision of,

	 	 	 	 	 
	 			(A) 	
      the articles or by-laws (or their equivalent) of
      Trans-Orient or any of the Trans-Orient Subsidiaries,

	 	 	 	 	 
	 			(B) 	
      any Law, regulation, order, judgment or decree,
  or

	 	 	 	 	 
	 			(C) 	
      any contract, agreement, licence, franchise or permit to
      which Trans- Orient or any of the Trans-Orient Subsidiaries is bound or is
      subject or of which Trans-Orient or any Trans-Orient Subsidiary is the
      beneficiary;

- 12 -

	 		(ii) 	
      give rise to any right of termination or acceleration of
      indebtedness, or cause any third person indebtedness owing by Trans-Orient
      or any of the Trans-Orient Subsidiaries to come due before its stated
      maturity or cause any available credit to cease to be available;

	 	 	 	 
	 		(iii) 	
      result in the imposition of any Encumbrance upon any of
      the property or assets of Trans-Orient or any of the Trans-Orient
      Subsidiaries, or restrict, hinder, impair or limit the ability of
      Trans-Orient or any of the Trans-Orient Subsidiaries to conduct the
      business of Trans-Orient or any of the Trans-Orient Subsidiaries as and
      where it is now being conducted or as and where it may be conducted in the
      future; or

	 	 	 	 
	 		(iv) 	
      result in any payment (including severance, unemployment
      compensation, golden parachute, bonus or otherwise) becoming due to any
      director, officer or employee of Trans-Orient or any of the Trans-Orient
      Subsidiaries or increase any benefits otherwise payable under any pension
      or benefits plan of Trans-Orient or any of the Trans-Orient Subsidiaries
      or result in the acceleration of the time of payment or vesting of any
      such benefits;

	 	 	 	 
	 		
      which would, individually or in the aggregate, have a
        Material Adverse Effect on Trans- Orient. No consent, approval, order or
        authorization of, or declaration or filing with, any Governmental Entity
        or other person is required to be obtained by Trans-Orient or any of the
        Trans-Orient Subsidiaries in connection with the execution and delivery of
        this Agreement or the consummation by Trans-Orient of the transactions
        contemplated hereby other than (i) any approvals required by the Interim
    Order, (ii) the Final Order, (iii) filings with the Registrar under the BCBCA and filings
      with and approvals required by Securities Authorities and stock exchanges,
      (iv) any other consent, waiver, permit, order or approval referred to in
      Section 5.01 of this Agreement or the Trans-Orient Disclosure Letter and
      (v) any other consent, approval, order, authorization, declaration or
      filing which, if not obtained, would not, individually or in the
    aggregate, have a Material Adverse Effect on Trans-Orient.

	 	 	 	 
	 	(d) 	
      Directors’ Approvals. The directors of
      Trans-Orient have received an oral opinion from Stephen Semeniuk, CFA, the
      financial advisor to the directors of Trans-Orient, that the exchange
      ratio in respect of the Arrangement is fair, from a financial point of
      view, to the Trans-Orient Shareholders and have unanimously:

	 	 	 	 
	 		(i) 	
      determined that the Arrangement is fair to the
      Trans-Orient Shareholders and is in the best interests of
    Trans-Orient;

	 	 	 	 
	 		(ii) 	
      determined that the directors of Trans-Orient will
      recommend that the Trans- Orient Shareholders vote in favour of the
      Arrangement; and

	 	 	 	 
	 		(iii) 	
      authorized the entering into of this Agreement, and the
      performance of its provisions, by Trans-Orient.

	 	 	 	 
	 	(e) 	
      Shareholder Rights Plan. Trans-Orient has not
      entered into a shareholder rights plan agreement or similar agreement and
      does not have in place any plan for the protection of shareholders of a
      kind generally referred to as a shareholder rights plan.

	 	 	 	 
	 	(f) 	
      Trans-Orient Subsidiaries. The only Subsidiaries
      of Trans-Orient are the Trans-Orient
Subsidiaries.

- 13 -

	 	(g) 	
      No Defaults. Except as set forth in Section
      3.01(g) of the Trans-Orient Disclosure Letter, other than (i) contracts
      entered into in the ordinary course of business; or (ii) as disclosed in
      the Trans-Orient Disclosure Documents, there are no contracts, agreements
      or licenses material to the conduct of the business of Trans-Orient (on a
      consolidated basis), TAG has been provided with a true and complete copy
      of all such material contracts, agreements and licenses and there are no
      current or pending negotiations with respect to the renewal, termination
      or amendment of any such material contracts, agreements or licenses that
      are not included in the Trans-Orient Disclosure Documents. Neither Trans-
      Orient nor any of the Trans-Orient Subsidiaries is in default under, and
      there exists no event, condition or occurrence which, after notice or
      lapse of time or both, would constitute such a default under, any
      contract, agreement or licence to which any of them is a party or by which
      any of them is bound which would, individually or in the aggregate, have a
      Material Adverse Effect on Trans-Orient.

	 	 	 	 
	 	(h) 	
      Absence of Changes. Except as set forth in Section
      3.01(h) of the Trans-Orient Disclosure Letter, since April 30, 2008 and
      other than as may be required as a result of any action involving
      Trans-Orient which has been disclosed in the Trans-Orient Disclosure
      Documents:

	 	 	 	 
	 		(i) 	
      Trans-Orient and each of the Trans-Orient Subsidiaries
      has conducted its business only in the ordinary and regular course of
      business consistent with past practice;

	 	 	 	 
	 		(ii) 	
      neither Trans-Orient nor any of the Trans-Orient
      Subsidiaries has incurred any liabilities or obligations of any nature
      (whether absolute, accrued, contingent or otherwise) which would,
      individually or in the aggregate, have a Material Adverse Effect on
      Trans-Orient;

	 	 	 	 
	 		(iii) 	
      neither Trans-Orient nor any of the Trans-Orient
      Subsidiaries has incurred or suffered a Material Adverse Change;

	 	 	 	 
	 		(iv) 	
      there has not occurred any destruction or loss that is
      not covered by insurance that would, individually or in the aggregate,
      have a Material Adverse Effect on Trans-Orient;

	 	 	 	 
	 		(v) 	
      there has not been any acquisition or sale by
      Trans-Orient or any of the Trans- Orient Subsidiaries of any material
      property or assets thereof;

	 	 	 	 
	 		(vi) 	
      other than in the ordinary and regular course of business
      consistent with past practice, there has not been any incurrence,
      assumption or guarantee by Trans- Orient or any of the Trans-Orient
      Subsidiaries of any debt for borrowed money, any creation or assumption by
      Trans-Orient or any of the Trans-Orient Subsidiaries of any Encumbrance,
      any making by Trans-Orient or any of the Trans-Orient Subsidiaries of any
      loan, advance or capital contribution to or investment in any other person
      (other than (i) travel loans or advances made in the ordinary course of
      business and (ii) other loans and advances in an aggregate amount which,
      in the case of both (i) and (ii), does not exceed $5,000 outstanding at
      any time) or any entering into, amendment of, relinquishment, termination
      or non-renewal by Trans-Orient or any of the Trans-Orient Subsidiaries of
      any contract, agreement, licence, franchise, lease transaction, commitment
      or other right or obligation which would, individually or in the
      aggregate, have a Material Adverse Effect on
  Trans-Orient;

- 14 -

	 		(vii) 	
      Trans-Orient has not declared or paid any dividends or
      made any other distribution on any of the Trans-Orient Common
    Shares;

	 	 	 	 
	 		(viii) 	
      Trans-Orient has not effected or passed any resolution to
      approve a split, consolidation or reclassification of any of the
      outstanding Trans-Orient Common Shares;

	 	 	 	 
	 		(ix) 	
      other than in the ordinary and regular course of business
      consistent with past practice, there has not been any increase in or
      modification of the compensation payable to or to become payable by
      Trans-Orient or any of the Trans-Orient Subsidiaries to any of their
      respective directors, officers or employees or any grant to any such
      director, officer or employee of any increase in severance or termination
      pay or any increase or modification of any bonus, pension, insurance or
      benefit arrangement (including, without limitation, the granting of Trans-
      Orient Options made to, for or with any of such directors, officers or
      employees);

	 	 	 	 
	 		(x) 	
      there has not been any labour dispute or charge of unfair
      labour practice, any activity or proceeding by a labour union or
      representative thereof to organize any of the employees of Trans-Orient or
      any of the Trans-Orient Subsidiaries or any campaign to solicit
      authorization from employees to be represented by such labour
  union;

	 	 	 	 
	 		(xi) 	
      Trans-Orient has not effected any material change in its
      accounting methods, principles or practices; and

	 	 	 	 
	 		(xii) 	
      Trans-Orient has not adopted any, or materially amended
      any, collective bargaining agreement, bonus, pension, profit sharing,
      stock purchase, stock option or other benefit plan.

	 	 	 	 
	 	(i) 	
      Employment Agreements. Other than as disclosed in
      the Trans-Orient Disclosure Documents or in Section 3.01(i) of the
      Trans-Orient Disclosure Letter:

	 	 	 	 
	 		(i) 	
      neither Trans-Orient nor any of the Trans-Orient
      Subsidiaries is a party to any written or oral policy, agreement,
      obligation or understanding providing for severance or termination
      payments to, or any employment agreement with, any director, officer or
      employee of Trans-Orient or any of the Trans-Orient
Subsidiaries;

	 	 	 	 
	 		(ii) 	
      neither Trans-Orient nor any of the Trans-Orient
      Subsidiaries has any employee or consultant whose employment or contract
      with Trans-Orient or the Trans- Orient Subsidiary, respectively, cannot be
      terminated upon a maximum of 12 months’ notice;

	 	 	 	 
	 		(iii) 	
      neither Trans-Orient nor any of the Trans-Orient
      Subsidiaries (i) is a party to any collective bargaining agreement, (ii)
      is subject to any application for certification or threatened or apparent
      union-organizing campaigns for employees not covered under a collective
      bargaining agreement, or (iii) is subject to any current, pending or
      threatened strike or lockout;

	 	 	 	 
	 		(iv) 	
      neither Trans-Orient nor any of the Trans-Orient
      Subsidiaries is subject to any claim for wrongful dismissal, constructive
      dismissal or any other tort claim,

- 15 -

	 			
      actual or threatened, or any litigation, actual or
      threatened, relating to the employment, or the termination of the
      employment, of any employee or independent contractor which, if determined
      in an adverse manner, would have a Material Adverse Effect on
      Trans-Orient; and

	 	 	 	 
	 		(v) 	
      Trans-Orient and the Trans-Orient Subsidiaries have
      operated in accordance with all applicable Laws with respect to employment
      and labour matters, including, but not limited to, employment and labour
      standards, occupational health and safety, employment equity, pay equity,
      workers’ compensation, human rights and labour relations and there are no
      current, pending or threatened proceedings before any board or tribunal
      with respect to any of the matters listed herein which, if determined in
      an adverse manner, would have a Material Adverse Effect on
      Trans-Orient.

	 	 	 	 
	 	(j) 	
      Financial Matters. The audited consolidated
      financial statements for the financial years ended July 31, 2008 and July
      31, 2007 of Trans-Orient and the unaudited consolidated financial
      statements for the three and nine month period ended April 30, 2009 were
      prepared in accordance with Canadian GAAP, consistently applied, and
      fairly present in all material respects the consolidated financial
      condition of Trans-Orient at the respective dates indicated and the
      results of operations of Trans-Orient for the periods covered on a
      consolidated basis and reflect adequate provision for the liabilities of
      Trans-Orient on a consolidated basis in accordance with Canadian GAAP.
      Neither Trans-Orient nor any of the Trans-Orient Subsidiaries has any
      liability or obligation (including, without limitation, liabilities or
      obligations to give any guarantees or for Taxes), whether accrued,
      absolute, contingent or otherwise, not reflected in the unaudited
      consolidated financial statements of Trans-Orient for the three and nine
      month period ended April 30, 2009, except (i) liabilities and obligations
      incurred in the ordinary course of business since April 30, 2009, (ii)
      liabilities and obligations incurred outside of the ordinary course of
      business which do not in the aggregate exceed $50,000 and (iii)
      liabilities and obligations resulting from actions involving Trans-Orient
      which have been publicly disclosed by Trans-Orient prior to the date
      hereof.

	 	 	 	 
		(k) 	
      Books and Records. The corporate records and
      minute books of Trans-Orient have been maintained substantially in
      accordance with all applicable Laws and are complete and accurate in all
      material respects. Financial books and records and accounts of Trans-
      Orient and the Trans-Orient Subsidiaries in all material respects (a) have
      been maintained in accordance with good business practices on a basis
      consistent with prior years, (b) are stated in reasonable detail and
      accurately and fairly reflect the transactions and acquisitions and
      dispositions of assets of Trans-Orient and the Trans-Orient Subsidiaries,
      and (c) accurately and fairly reflect the basis for the consolidated
      financial statements of Trans-Orient. Trans-Orient has devised and
      maintains a system of internal accounting controls sufficient to provide
      reasonable assurances that, in all material respects (a) transactions are
      executed in accordance with the general or specific authorization of the
      management of Trans-Orient, and (b) transactions are recorded as necessary
      (i) to permit preparation of financial statements in conformity with
      Canadian GAAP or any criteria applicable to such statements and (ii) to
      maintain accountability for assets and liabilities.

	 	 	 	 
	 	(l) 	
      Litigation. There is no claim, action, proceeding
      or investigation pending or, to the knowledge of Trans-Orient, threatened
      against or relating to Trans-Orient or any of the Trans-Orient
      Subsidiaries or affecting any of their respective properties or assets
      before any court or governmental or regulatory authority or body or other
      Governmental Entity.

- 16 -

	 		
      Neither Trans-Orient nor any of the Trans-Orient
      Subsidiaries nor any of their respective properties or assets is subject
      to any outstanding judgment, order, writ, injunction or decree that
      restricts or may restrict the right or ability of Trans-Orient or the
      Trans-Orient Subsidiary, respectively, to conduct its business in all
      material respects as it has been carried on prior to the date hereof, or
      that would materially impede the consummation of the transactions
      contemplated by this Agreement.

	 	 	 	 
	 	(m) 	
      Environmental. There have not occurred any
      material spills, emissions or pollution on any property of Trans-Orient or
      any of the Trans-Orient Subsidiaries or as a result of its operations, nor
      has Trans-Orient or any of the Trans-Orient Subsidiaries been subject to
      any stop orders, control orders, clean-up orders or reclamation orders
      under applicable Environmental Laws, any of which would individually or in
      the aggregate have a Material Adverse Effect on Trans-Orient. All
      operations of Trans-Orient and the Trans- Orient Subsidiaries have been
      and are now being conducted in compliance with all applicable
      Environmental Laws, except where the failure to be in compliance would not
      individually or in the aggregate have a Material Adverse Effect on
      Trans-Orient. Neither Trans-Orient nor any or the Trans-Orient
      Subsidiaries is aware of, or is subject to:

	 	 	 	 
	 		(i) 	
      any proceeding, application, order or directive which
      relates to environmental, health or safety matters, and which may require
      any material work, repairs, construction, or expenditures; or

	 	 	 	 
	 		(ii) 	
      any demand or notice with respect to the breach of any
      Environmental Laws applicable to Trans-Orient or any of the Trans-Orient
      Subsidiaries, including any regulations respecting the use, storage,
      treatment, transportation, or disposition of any Hazardous
    Substances,

	 	 	 	 
	 		
      which would reasonably be expected to have a Material
      Adverse Effect on Trans-Orient.

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

	 	 	 	 
	 	(n) 	
      Title. Trans-Orient and the Trans-Orient
      Subsidiaries have good and sufficient title to their real property
      interests including fee simple estate of and in real property, leases,
      easements, rights of way, permits or licenses from landowners or
      authorities permitting the use of land by Trans-Orient and the
      Trans-Orient Subsidiaries necessary to permit the operation of its
      business as presently owned and conducted. Trans-Orient does not have any
      knowledge nor is aware of any defects, failures or impairments in the
      title of Trans- Orient to its assets or the assets of the Trans-Orient
      Subsidiaries, whether or not an action, suit, proceeding or inquiry is
      pending or threatened or whether or not discovered by any third party,
      which in aggregate would have a Material Adverse Effect on Trans-
      Orient.

- 17 -

	 	(o) 	
      No Defaults under Leases and Agreements.

	 	 	 	 	 
	 		(i) 	
      Neither Trans-Orient nor the Trans-Orient Subsidiaries
      has received notice of any default under any of the leases and other title
      and operating documents or any other agreement or instrument pertaining to
      any of their respective assets to which Trans-Orient is a party or by or
      to which Trans-Orient, any Trans-Orient Subsidiary or any such assets are
      bound or subject except to the extent that such defaults would not in the
      aggregate have a Material Adverse Effect on Trans- Orient.

	 	 	 	 	 
	 		(ii) 	
      To its knowledge:

	 	 	 	 	 
	 			(1) 	
      Trans-Orient and the Trans-Orient Subsidiaries are in
      good standing under all, and are not in default under any, and

	 	 	 	 	 
	 			(2) 	
      there is no existing condition, circumstance or matter
      which constitutes or which, with the passage of time or the giving of
      notice, would constitute a default under any,

	 	 	 	 	 
	 			
      leases and other title and operating documents or any
      other agreements and instruments pertaining to Trans-Orient or any of the
      Trans-Orient Subsidiaries’ assets to which they are a party or by or to
      which they or such assets are bound or subject and, to its knowledge, all
      such leases, title and operating documents and other agreements and
      instruments are in good standing and in full force and effect and none of
      the counterparties to such leases, title and operating documents and other
      agreements and instruments is in default thereunder except to the extent
      that such defaults would not, individually or in the aggregate, have a
      Material Adverse Effect on Trans-Orient.

	 	 	 	 	 
	 	(p) 	
      No Encumbrances. Neither Trans-Orient nor any
      Trans-Orient Subsidiary has encumbered or alienated its interest in its
      assets or agreed to do so and such assets are free and clear of all
      Encumbrances except for such Encumbrances as are disclosed in any
      governmental registry or arising in the ordinary course of
  business.

	 	 	 	 	 
	 	(q) 	
      Royalties, Rentals and Taxes Paid. All royalties
      and rentals payable under the leases and other title and operating
      documents pertaining to the assets of Trans-Orient or any Trans- Orient
      Subsidiary and all ad valorem, property, production, severance and similar
      taxes and assessments based upon or measured by the ownership of such
      assets or the production of petroleum substances derived therefrom or
      allocated thereto or the proceeds of sales thereof payable have been
      properly paid in full and in a timely manner except to the extent that
      such non-payment would not in the aggregate have a Material Adverse Effect
      on Trans-Orient.

	 	 	 	 	 
	 	(r) 	
      Licences. Each of Trans-Orient and the
      Trans-Orient Subsidiaries has obtained and is in compliance with all
      licenses, permits, certificates, consents, orders, grants and other
      authorizations of or from any Governmental Entity necessary to conduct its
      businesses as they are now being or are proposed to be conducted, other
      than such permissions the absence of which would, individually or in the
      aggregate, not have a Material Adverse Effect on Trans-Orient.

	 	 	 	 	 
	 	(s) 	
      Insurance. The Trans-Orient Disclosure Letter sets
      forth details of all policies of insurance in force as of the date hereof
      naming Trans-Orient as an insured. Such
policies

- 18 -

	 		
      of insurance adequately cover all risks reasonably and
      prudently foreseeable in the operation and conduct of the business of
      Trans-Orient and the Trans-Orient Subsidiaries. All such policies of
      insurance will remain in full force and effect and will not be cancelled
      or otherwise terminated as a result of the completion of the transactions
      contemplated hereby other than such cancellations as would not,
      individually or in the aggregate, have a Material Adverse Effect on
      Trans-Orient.

	 	 	 	 
	 	(t) 	
      Tax Matters. Trans-Orient and the Trans-Orient
      Subsidiaries have filed or caused to be filed in a timely manner all
      material Tax Returns required to be filed by them (all of which Tax
      Returns were correct and complete in all material respects) and have paid,
      collected, withheld or remitted, or caused to be paid, collected, withheld
      or remitted, all Taxes that are due and payable, collectible and
      remittable. Trans-Orient has provided adequate accruals in accordance with
      Canadian GAAP in its most recently published consolidated financial
      statements for any Taxes for the period covered by such financial
      statements which have not been paid, whether or not shown as being due on
      any Tax Returns. Since such publication date, no material liability for
      Taxes not reflected in such financial statements or otherwise provided for
      has been assessed, proposed to be assessed, incurred or accrued other than
      in the ordinary course of business. To the knowledge of Trans-Orient,
      there are no material proposed (but unassessed) additional Taxes and none
      have been asserted by Canada Customs and Revenue Agency, the United States
      Internal Revenue Service or any other taxing authority, including, without
      limitation, any sales tax authority, in connection with any of the Tax
      Returns referred to above, and no waiver of any statute of limitations has
      been given or requested with respect to Trans-Orient or any of the
      Trans-Orient Subsidiaries. No lien for Taxes has been filed other than for
      Taxes not yet due and payable.

	 	 	 	 
	 	(u) 	
      Certain Additional Tax Matters. To the knowledge
      of Trans-Orient, for the purposes of the Code, the cost basis of the
      shares of each of the Trans-Orient Subsidiaries is greater than the fair
      market value of such shares. To the knowledge of Trans-Orient, no interest
      in or of Trans-Orient constitutes a United States Real Property Interest
      within the meaning of Section 897 of the Code.

	 	 	 	 
	 	(v) 	
      Intellectual Property. To the knowledge of
      Trans-Orient, Trans-Orient and the Trans- Orient Subsidiaries own, or are
      validly licensed or otherwise have the right to use, all patents, patent
      rights, trademarks, trade names, service marks, copyrights, know how and
      other proprietary intellectual property rights that are material to the
      conduct of the business of Trans-Orient and the Trans-Orient
      Subsidiaries.

	 	 	 	 
	 	(w) 	
      Pension and Employee Benefits.

	 	 	 	 
	 		(i) 	
      Trans-Orient and the Trans-Orient Subsidiaries have
      complied, in all material respects, with all of the terms of, and all
      applicable Laws in respect of, the pension and other employee compensation
      and benefit obligations of Trans- Orient and the Trans-Orient
      Subsidiaries, as the case may be, including the provisions of any
      collective agreements, funding and investment contracts or obligations
      applicable thereto, arising under or relating to each of the pension or
      retirement income plans or other employee compensation or benefit plans,
      agreements, policies, programs, arrangements or practices, whether written
      or oral, if any, which are maintained by or binding upon Trans-Orient or
      the Trans- Orient Subsidiaries, as the case may be, (collectively referred
      to in this subsection as the “Trans-Orient Plans”) and all Trans-Orient
      Plans maintained by or binding upon Trans-Orient or any of the
      Trans-Orient Subsidiaries are fully

- 19 -

	 			
      funded and in good standing with such regulatory
      authorities as may be applicable and no notice of underfunding,
      non-compliance, failure to be in good standing or otherwise has been
      received by Trans-Orient or any of the Trans- Orient Subsidiaries from any
      such regulatory authority.

	 	 	 	 
	 		(ii) 	
      No action has been taken, no event has occurred and no
      condition or circumstance exists that has resulted in or could reasonably
      be expected to result in any Trans-Orient Plan maintained by or binding
      upon Trans-Orient or any of the Trans-Orient Subsidiaries being ordered or
      required to be terminated or wound up in whole or in part or having its
      registration under applicable legislation refused or revoked, or being
      placed under the administration of any trustee or receiver or regulatory
      authority or being required to pay any Taxes, fees, penalties or levies in
      excess of $10,000 under applicable Laws. There are no actions, suits,
      claims (other than routine claims for payment of benefits in the ordinary
      course), trials, demands, investigations, arbitrations or other
      proceedings which are pending or, to the knowledge of Trans-Orient,
      threatened in respect of any of the Trans-Orient Plans maintained by or
      binding upon Trans-Orient or any of the Trans-Orient Subsidiaries or their
      respective assets.

	 	 	 	 
	 	(x) 	
      Reporting Status. Trans-Orient is a reporting
      issuer or its equivalent in each of the provinces of British Columbia and
      Alberta. The only stock exchange on which the Trans-Orient Common Shares
      are listed is the TSX-V and the Trans-Orient Common Shares are also
      authorized to be quoted on the OTCBB, but are otherwise not listed on a
      national securities exchange or authorized to be quoted in an inter-dealer
      quotation system of a registered national securities association, in
      either case within the meaning of Rule 13e-3 under the 1934 Act.

	 	 	 	 
		(y) 	
      Reports. Since April 30, 2009, Trans-Orient has
      filed with the Securities Authorities, stock exchanges and all applicable
      self-regulatory authorities a true and complete copy of all forms,
      reports, schedules, statements, certifications, material change reports
      and other documents required to be filed by it (such forms, reports,
      schedules, statements, certifications and other documents, including any
      financial statements or other documents, including any schedules included
      therein, are referred to in this subsection as the “Trans-Orient
      Documents”). The Trans-Orient Documents, at the time filed, (a) did not
      contain any misrepresentation (as defined in applicable securities Laws)
      and (b) complied in all material respects with the requirements of
      applicable securities legislation. Trans-Orient has not filed any
      confidential material change or other report or other document with any
      Securities Authorities or stock exchange or other self-regulatory
      authority which at the date hereof remains confidential.

	 	 	 	 
	 	(z) 	
      Compliance with Laws. Trans-Orient and the
      Trans-Orient Subsidiaries have complied with and are not in violation of
      any applicable Law other than such non-compliance or violations which
      would not, individually or in the aggregate, have a Material Adverse
      Effect on Trans-Orient.

	 	 	 	 
	 	(aa) 	
      Licences. Trans-Orient and each of the
      Trans-Orient Subsidiaries owns, possesses, or has obtained and is in
      compliance with, all licences, permits (including licences and permits
      required under environmental Laws), certificates, orders, grants and other
      authorizations of or from all Governmental Entities necessary to conduct
      its business as now conducted or as proposed to be conducted, except where
      the failure to own, possess, obtain or to be in compliance with which
      would not individually or in the aggregate have a Material Adverse Effect
      on Trans-Orient.

- 20 -

	 	(bb) 	
      Certain Contracts. Neither Trans-Orient nor any of
      the Trans-Orient Subsidiaries is a party to or bound by any
      non-competition agreement or any other agreement, obligation, judgment,
      injunction, order or decree which purports to (a) limit the manner or the
      localities in which all or any material portion of the business of
      Trans-Orient (on a consolidated basis) is or would be conducted, (b) limit
      any business practice of Trans- Orient (on a consolidated basis) or (c)
      restrict any acquisition or disposition of any property by Trans-Orient or
      the Trans-Orient Subsidiary.

	 	 	 
	 	(cc) 	
      Foreign Private Issuer. Trans-Orient is a “foreign
      private issuer” as defined in Rule 405 under the 1933 Act.

	 	 	 
	 	(dd) 	
      Investment Company Status. Trans-Orient is not
      registered and is not required to be registered as an open-end investment
      company, a closed-end investment company, a unit investment trust or a
      face-amount certificate company under the 1940 Act.

	 	 	 
	 	(ee) 	
      Full Disclosure. Trans-Orient has made available
      to TAG all material information, including financial, operational, sales
      and other information, in respect of the business of Trans-Orient and the
      Trans-Orient Subsidiaries requested by TAG and all such information as
      made available to TAG is true and correct in all material respects and no
      material fact or facts have been omitted therefrom which would make such
      information misleading.

	 	 	 
	 	(ff) 	
      Proxy Circular. When mailed, the Proxy Circular
      will not contain an untrue statement of a material fact concerning
      Trans-Orient or the Trans-Orient Subsidiaries and will not omit to state a
      material fact concerning Trans-Orient or the Trans-Orient Subsidiaries
      that is required to be stated or that is necessary to make a statement
      contained therein not misleading in the light of the circumstances in
      which it was made.

	Section 3.02 	Representations and Warranties of TAG
  

Each of TAG and TAG Subco hereby represents and warrants to
Trans-Orient, and hereby acknowledges that Trans-Orient is relying upon such
representations and warranties in connection with entering into this Agreement
and agreeing to complete the Arrangement, as follows:

	 	(a) 	
      Organization. TAG and each of the TAG Subsidiaries
      has been incorporated, is validly subsisting and has full corporate power
      and authority to own its property and assets and conduct its business as
      currently owned and conducted. TAG and each of the TAG Subsidiaries is
      registered, licensed or otherwise qualified as an extra-provincial
      corporation or a foreign corporation in each jurisdiction where the nature
      of the business or the location or character of the property and assets
      owned or leased by it requires it to be so registered, licensed or
      otherwise qualified, other than those jurisdictions where the failure to
      be so registered, licensed or otherwise qualified would not have a
      Material Adverse Effect on TAG. All of the outstanding shares of the TAG
      Subsidiaries are validly issued, fully paid and non-assessable. All of the
      outstanding shares of the TAG Subsidiaries are owned directly or
      indirectly by TAG. Except pursuant to restrictions on transfer contained
      in the articles or by-laws (or their equivalent) of the applicable TAG
      Subsidiary, the shares of each TAG Subsidiary which are owned by TAG (or
      by another TAG Subsidiary) are owned free and clear of all Encumbrances.
      There are no outstanding options, rights, entitlements, understandings or
      commitments (contingent or otherwise) regarding the right to acquire any
      securities of any TAG Subsidiary from either TAG or any other TAG
      Subsidiary. TAG Subco was incorporated for the purpose of completing the
      Arrangement and has carried on no other
business.

- 21 -

	 	(b) 	
      Capitalization. TAG is authorized to issue an
      unlimited number of TAG Common Shares. As at September 11, 2009, there
      were 16,809,722 TAG Common Shares outstanding and an aggregate of 222,000
      TAG Common Shares were set aside for issue under the stock option plan of
      TAG. Except (i) as described in the immediately preceding sentence, (ii)
      as disclosed in the TAG disclosure Documents, and (iii) pursuant to this
      Agreement and the transactions contemplated hereby, there are no options,
      warrants, conversion privileges or other rights, agreements, arrangements
      or commitments (pre-emptive, contingent or otherwise) obligating TAG or
      any of the TAG Subsidiaries to issue or sell any shares of TAG or any of
      the TAG Subsidiaries or any securities or obligations of any kind
      convertible into or exchangeable for any shares of TAG or any of the TAG
      Subsidiaries, nor are there outstanding any share appreciation rights,
      phantom equity or similar rights, agreements, arrangements or commitments
      based upon the book value, income or any other attribute of TAG or any of
      the TAG Subsidiaries. All outstanding TAG Common Shares have been
      authorized and are validly issued and outstanding as fully paid and
      non-assessable shares, free of pre-emptive rights. There are no
      outstanding bonds, debentures or other evidences of indebtedness of TAG or
      any of the TAG Subsidiaries having the right to vote with the TAG
      Shareholders on any matter. There are no outstanding contractual
      obligations of TAG or of any of the TAG Subsidiaries to repurchase, redeem
      or otherwise acquire any outstanding TAG Common Shares or with respect to
      the voting or disposition of any outstanding TAG Common Shares.

	 	 	 	 	 
	 	(c) 	
      Authority. Each of TAG and TAG Subco has the
      requisite corporate power and authority to enter into this Agreement and
      to perform its obligations hereunder. The execution and delivery of this
      Agreement by TAG and TAG Subco and the completion by TAG and TAG Subco of
      the transactions contemplated by this Agreement have been authorized by
      the directors of TAG and TAG Subco, respectively, and no other corporate
      proceedings on the part of TAG or TAG Subco are necessary to authorize
      this Agreement or to complete the transactions contemplated hereby. This
      Agreement has been executed and delivered by each of TAG and TAG Subco and
      constitutes a legal, valid and binding obligation of each of TAG and TAG
      Subco, enforceable against TAG in accordance with its terms, subject to
      bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium
      and other applicable Laws relating to or affecting creditors’ rights
      generally, and to general principles of equity. The execution and delivery
      by TAG of this Agreement and the performance by them of their respective
      obligations hereunder and the completion of the transactions contemplated
      hereby, do not and will not:

	 	 	 	 	 
	 		(i) 	
      result in a violation or breach of, require any consent
      to be obtained under or give rise to any termination rights under any
      provision of,

	 	 	 	 	 
	 			(A) 	
      the articles or by-laws (or their equivalent) of TAG or
      any of the TAG Subsidiaries,

	 	 	 	 	 
	 			(B) 	
      any Law, regulation, order, judgment or decree,
  or

	 	 	 	 	 
	 			(C) 	
      any contract, agreement, licence, franchise or permit to
      which TAG or any of the TAG Subsidiaries is bound or is subject to or of
      which TAG or any TAG Subsidiary is the beneficiary;

	 	 	 	 	 
	 		(ii) 	
      give rise to any right of termination or acceleration of
      indebtedness, or cause any third person indebtedness owing by TAG or any
      of the TAG Subsidiaries to come due before its stated maturity or cause
      any of its available credit to cease to be
available;

- 22 -

	 		(iii) 	
      result in the imposition of any Encumbrance upon any of
      the property or assets of TAG or any of the TAG Subsidiaries, or restrict,
      hinder, impair or limit the ability of TAG or any of the TAG Subsidiaries
      to conduct the business of TAG or any of the TAG Subsidiaries as and where
      it is now being conducted or as and where it may be conducted in the
      future; or

	 	 	 	 
	 		(iv) 	
      result in any payment (including severance, unemployment
      compensation, golden parachute, bonus or otherwise) becoming due to any
      director, officer or employee of TAG or any of the TAG Subsidiaries or
      increase any benefits otherwise payable under any pension or benefits plan
      of TAG or any of the TAG Subsidiaries or result in the acceleration of the
      time of payment or vesting of any such benefits;

	 	 	 	 
			
      which would, individually or in the aggregate, have a
      Material Adverse Effect on TAG. No consent, approval, order or
      authorization of, or declaration or filing with, any Governmental Entity
      or other person is required to be obtained by TAG or any of the TAG
      Subsidiaries in connection with the execution and delivery of this
      Agreement or the consummation by TAG and TAG Subco of the transactions
      contemplated hereby other than (i) any approvals required by the Interim
      Order, (ii) the Final Order, (iii) filings required under the BCBCA, in
      the case of TAG Subco, and filings with and approvals required by the
      Securities Authorities and stock exchanges, (iv) any other consents,
      waivers, permits, orders or approvals referred to in Section 5.01 of this
      Agreement and (v) any other consents, approvals, orders, authorizations,
      declarations or filings which, if not obtained, would not, individually or
      in the aggregate, have a Material Adverse Effect on TAG.

	 	 	 	 
	 	(d) 	
      Directors’ Approvals. The directors of TAG have
      received a oral opinion from Evans & Evans, Inc., the financial
      advisor to the directors of TAG, that the consideration under the
      Arrangement is fair, from a financial point of view, to TAG and have
      unanimously:

	 	 	 	 
	 		(i) 	
      determined that the Arrangement is fair to the TAG
      Shareholders and is in the best interests of TAG; and

	 	 	 	 
	 		(ii) 	
      authorized the entering into of this Agreement, and the
      performance of its provisions, by TAG.

	 	 	 	 
	 	(e) 	
      Shareholder Rights Plan. TAG has not entered into
      a shareholder rights plan agreement or similar agreement and does not have
      in place any plan for the protection of shareholders of a kind generally
      referred to as a shareholder rights plan.

	 	 	 	 
	 	(f) 	
      TAG Subsidiaries. The only Subsidiaries of TAG are
      the TAG Subsidiaries.

	 	 	 	 
	 	(g) 	
      No Defaults. Other than (i) customer contracts
      entered into in the ordinary course of business, or (ii) as disclosed in
      the TAG Disclosure Documents, there are no contracts, agreements or
      licenses material to the conduct of the business of TAG (on a consolidated
      basis), Trans-Orient has been provided with a true and complete copy of
      all such material contracts, agreements or licenses or access thereto and
      there are no current or pending negotiations with respect to the renewal,
      termination or amendment of any such material contracts, agreements and
      licenses that are not included in the TAG Disclosure Documents. Neither
      TAG nor any of the TAG Subsidiaries is in default under, and there exists
      no event, condition or occurrence which, after notice or lapse of time or
      both, would constitute such a default under, any contract, agreement or
      licence to which any of

- 23 -

	 		
      them is a party or by which any of them is bound which
      would, individually or in the aggregate, have a Material Adverse Effect on
      TAG.

	 	 	 	 
	 	(h) 	
      Absence of Changes. Since March 31, 2009, and
      other than as may be required as a result of any action involving TAG
      which has been disclosed in the TAG Disclosure Documents:

	 	 	 	 
	 		(i) 	
      TAG and each of the TAG Subsidiaries has conducted its
      business only in the ordinary and regular course of business consistent
      with past practice;

	 	 	 	 
	 		(ii) 	
      neither TAG nor any of the TAG Subsidiaries has incurred
      any liabilities or obligations of any nature (whether absolute, accrued,
      contingent or otherwise) which would, individually or in the aggregate,
      have a Material Adverse Effect on TAG;

	 	 	 	 
	 		(iii) 	
      neither TAG nor any of the TAG Subsidiaries has incurred
      or suffered a Material Adverse Change;

	 	 	 	 
	 		(iv) 	
      there has not occurred any destruction or loss that is
      not covered by insurance that would, individually or in the aggregate,
      have a Material Adverse Effect on TAG;

	 	 	 	 
	 		(v) 	
      there has not been any acquisition or sale by TAG or any
      of the TAG Subsidiaries of any material property or assets
  thereof;

	 	 	 	 
	 		(vi) 	
      other than in the ordinary and regular course of business
      consistent with past practice, there has not been any incurrence,
      assumption or guarantee by TAG or any of the TAG Subsidiaries of any debt
      for borrowed money, any creation or assumption by TAG or any of the TAG
      Subsidiaries of any Encumbrance, any making by TAG or any of the TAG
      Subsidiaries of any loan, advance or capital contribution to or investment
      in any other person (other than (i) travel loans or advances made in the
      ordinary course of business and (ii) other loans and advances in an
      aggregate amount which, in the case of both (i) and (ii), does not exceed
      $5,000 outstanding at any time) or any entering into, amendment of,
      relinquishment, termination or non-renewal by TAG or any of the TAG
      Subsidiaries of any contract, agreement, licence, franchise, lease
      transaction, commitment or other right or obligation which would,
      individually or in the aggregate, have a Material Adverse Effect on
      TAG;

	 	 	 	 
	 		(vii) 	
      TAG has not, to the date of this Agreement, declared or
      paid any dividends or made any other distribution on any of the TAG Common
      Shares;

	 	 	 	 
	 		(viii) 	
      TAG has not effected or passed any resolution to approve
      a split, consolidation or reclassification of any of the outstanding TAG
      Common Shares;

	 	 	 	 
	 		(ix) 	
      other than in the ordinary and regular course of business
      consistent with past practice, there has not been any increase in or
      modification of the compensation payable to or to become payable by TAG or
      any of the TAG Subsidiaries to any of their respective directors, officers
      or employees or any grant to any such director, officer or employee of any
      increase in severance or termination pay or any increase or modification
      of any bonus, pension, insurance or benefit arrangement made to, for or
      with any of such directors, officers or
employees;

- 24 -

	 		(x) 	
      there has not been any labour dispute or charge of unfair
      labour practice, any activity or proceeding by a labour union or
      representative thereof to organize any of the employees of TAG or any of
      the TAG Subsidiaries or any campaign to solicit authorization from
      employees to be represented by such labour union;

	 	 	 	 
	 		(xi) 	
      TAG has not effected any material change in its
      accounting methods, principles or practices; and

	 	 	 	 
	 		(xii) 	
      TAG has not adopted any, or materially amended any,
      collective bargaining agreement, bonus, pension, profit sharing, stock
      purchase, stock option or other benefit plan or shareholder rights
      plan.

	 	 	 	 
	 	(i) 	
      Employment Agreements. Other than as disclosed in
      the TAG Disclosure Documents:

	 	 	 	 
	 		(i) 	
      neither TAG nor any of the TAG Subsidiaries is a party to
      any written or oral policy, agreement, obligation or understanding
      providing for severance or termination payments to, or any employment
      agreement with, any director, officer or employee of TAG or any of the TAG
      Subsidiaries;

	 	 	 	 
	 		(ii) 	
      neither TAG nor any of the TAG Subsidiaries has any
      employee or consultant whose employment or contract with TAG or the TAG
      Subsidiary, respectively, cannot be terminated upon a maximum of 12
      months’ notice;

	 	 	 	 
	 		(iii) 	
      neither TAG nor any of the TAG Subsidiaries (i) is a
      party to any collective bargaining agreement, (ii) is subject to any
      application for certification or threatened or apparent union-organizing
      campaigns for employees not covered under a collective bargaining
      agreement, or (iii) is subject to any current, pending or threatened
      strike or lockout;

	 	 	 	 
	 		(iv) 	
      neither TAG nor any of the TAG Subsidiaries is subject to
      any claim for wrongful dismissal, constructive dismissal or any other tort
      claim, actual or threatened, or any litigation, actual or threatened,
      relating to the employment, or the termination of the employment, of any
      employee or independent contractor which, if determined in an adverse
      manner, would have a Material Adverse Effect on TAG; and

	 	 	 	 
	 		(v) 	
      TAG and the TAG Subsidiaries have operated in accordance
      with all applicable Laws with respect to employment and labour matters,
      including, but not limited to, employment and labour standards,
      occupational health and safety, employment equity, pay equity, workers’
      compensation, human rights and labour relations and there are no current,
      pending or threatened proceedings before any board or tribunal with
      respect to any of the matters listed herein which, if determined in an
      adverse manner, would have a Material Adverse Effect on TAG.

	 	 	 	 
	 	(j) 	
      Financial Matters. The audited consolidated
      financial statements for the financial years ended March 31, 2009 and
      March 31, 2008 of TAG and the unaudited interim consolidated statements of
      TAG for the three-month period ended June 30, 2009 were prepared in
      accordance with Canadian GAAP consistently applied, and fairly present in
      all material respects the consolidated financial condition of TAG at the
      respective dates indicated and the results of operations of TAG for the
      periods covered on a consolidated basis and reflect adequate provision for
      the liabilities of TAG on a consolidated basis
in

- 25 -

	 		
      accordance with Canadian GAAP. Neither TAG nor any of the
      TAG Subsidiaries has any liability or obligation (including, without
      limitation, liabilities or obligations to give any guarantees or for
      Taxes), whether accrued, absolute, contingent or otherwise, not reflected
      in the unaudited consolidated financial statements of TAG for the
      financial period ended June 30, 2009, except (i) liabilities and
      obligations incurred in the ordinary course of business since June 30,
      2009, (ii) liabilities and obligations incurred outside of the ordinary
      course of business which do not in the aggregate exceed $50,000, and (iii)
      liabilities and obligations resulting from actions involving TAG which
      have been publicly disclosed by TAG prior to the date hereof (including
      liabilities and obligations in connection with the Cheal
    Acquisition).

	 	 	 	 
	 	(k) 	
      Books and Records. The corporate records and
      minute books of TAG have been maintained substantially in accordance with
      all applicable Laws and are complete and accurate in all material
      respects. Financial books and records and accounts of TAG and the TAG
      Subsidiaries in all material respects (a) have been maintained in
      accordance with good business practices on a basis consistent with prior
      years, (b) are stated in reasonable detail and accurately and fairly
      reflect the transactions and acquisitions and dispositions of assets of
      TAG and the TAG Subsidiaries, and (c) accurately and fairly reflect the
      basis for the TAG consolidated financial statements. TAG has devised and
      maintains a system of internal accounting controls sufficient to provide
      reasonable assurances that, in all material respects (a) transactions are
      executed in accordance with the general or specific authorization of the
      management of TAG, and (b) transactions are recorded as necessary (i) to
      permit preparation of financial statements in conformity with Canadian
      GAAP or any criteria applicable to such statements and (ii) to maintain
      accountability for assets and liabilities.

	 	 	 	 
	 	(l) 	
      Litigation. There is no claim, action, proceeding
      or investigation pending or, to the knowledge of TAG, threatened against
      or relating to TAG or any of the TAG Subsidiaries or affecting any of
      their respective properties or assets before any court or governmental or
      regulatory authority or body or other Governmental Entity. Neither TAG nor
      any of the TAG Subsidiaries nor any of their respective properties or
      assets is subject to any outstanding judgment, order, writ, injunction or
      decree that restricts or may restrict the right or ability of TAG or the
      TAG Subsidiary, as the case may be, to conduct its business in all
      material respects as it has been carried on prior to the date hereof, or
      that would materially impede the consummation of the transactions
      contemplated by this Agreement.

	 	 	 	 
	 	(m) 	
      Environmental. There have not occurred any
      material spills, emissions or pollution on any property of TAG or any of
      the TAG Subsidiaries or as a result of its operations, nor has TAG or any
      of the TAG Subsidiaries been subject to any stop orders, control orders,
      clean-up orders or reclamation orders under applicable Environmental Laws,
      any of which would individually or in the aggregate have a Material
      Adverse Effect on TAG. All operations of TAG and the TAG Subsidiaries have
      been and are now being conducted in compliance with all applicable
      Environmental Laws, except where the failure to be in compliance would not
      individually or in the aggregate have a Material Adverse Effect on TAG.
      Neither TAG nor any or the TAG Subsidiaries is aware of, or is subject
      to:

	 	 	 	 
	 		(i) 	
      any proceeding, application, order or directive which
      relates to environmental, health or safety matters, and which may require
      any material work, repairs, construction, or expenditures;
  or

- 26 -

	 		(ii) 	
      any demand or notice with respect to the breach of any
      Environmental Laws applicable to TAG or any of the TAG Subsidiaries,
      including any regulations respecting the use, storage, treatment,
      transportation, or disposition of any Hazardous Substances,

	 	 	 	 	 
	 		
      which would reasonably be expected to have a Material
      Adverse Effect on TAG.

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

	 	 	 	 	 
	 	(n) 	
      Title. TAG and the TAG Subsidiaries have good and
      sufficient title to their real property interests including fee simple
      estate of and in real property, leases, easements, rights of way, permits
      or licenses from landowners or authorities permitting the use of land by
      TAG and the TAG Subsidiaries necessary to permit the operation of its
      business as presently owned and conducted. TAG does not have any knowledge
      nor is aware of any defects, failures or impairments in the title of TAG
      to its assets or the assets of the TAG Subsidiaries, whether or not an
      action, suit, proceeding or inquiry is pending or threatened or whether or
      not discovered by any third party, which in aggregate would have a
      Material Adverse Effect on TAG.

	 	 	 	 	 
	 	(o) 	
      No Defaults under Leases and Agreements.

	 	 	 	 	 
	 		(i) 	
      Neither TAG nor the TAG Subsidiaries has received notice
      of any default under any of the leases and other title and operating
      documents or any other agreement or instrument pertaining to any of their
      respective assets to which TAG is a party or by or to which TAG, any TAG
      Subsidiary or any such assets are bound or subject except to the extent
      that such defaults would not in the aggregate have a Material Adverse
      Effect on TAG.

	 	 	 	 	 
	 		(ii) 	
      To its knowledge:

	 	 	 	 	 
	 			(1) 	
      TAG and the TAG Subsidiaries are in good standing under
      all, and are not in default under any, and

	 	 	 	 	 
	 			(2) 	
      there is no existing condition, circumstance or matter
      which constitutes or which, with the passage of time or the giving of
      notice, would constitute a default under any,

	 	 	 	 	 
	 			
      leases and other title and operating documents or any
      other agreements and instruments pertaining to TAG or any of the TAG
      Subsidiaries’ assets to which they are a party or by or to which they or
      such assets are bound or subject and, to its knowledge, all such leases,
      title and operating documents and other agreements and instruments are in
      good standing and in full force and effect and none of the counterparties
      to such leases, title and operating documents and other agreements and
      instruments is in default thereunder except to the extent that
  such

- 27 -

defaults would not, individually or in
the aggregate, have a Material Adverse Effect on TAG.

	 	(p) 	
      No Encumbrances. Neither TAG nor any TAG
      Subsidiary has encumbered or alienated its interest in its assets or
      agreed to do so and such assets are free and clear of all Encumbrances
      except for such Encumbrances as are disclosed in any governmental registry
      or arising in the ordinary course of business.

	 	 	 
	 	(q) 	
      Royalties, Rentals and Taxes Paid. All royalties
      and rentals payable under the leases and other title and operating
      documents pertaining to the assets of TAG or any TAG Subsidiary and all ad
      valorem, property, production, severance and similar taxes and assessments
      based upon or measured by the ownership of such assets or the production
      of petroleum substances derived therefrom or allocated thereto or the
      proceeds of sales thereof payable have been properly paid in full and in a
      timely manner except to the extent that such non-payment would not in the
      aggregate have a Material Adverse Effect on TAG.

	 	 	 
	 	(r) 	
      Licences. Each of TAG and the TAG Subsidiaries has
      obtained and is in compliance with all licenses, permits, certificates,
      consents, orders, grants and other authorizations of or from any
      Governmental Entity necessary to conduct its businesses as they are now
      being or are proposed to be conducted, other than such permissions the
      absence of which would, individually or in the aggregate, not have a
      Material Adverse Effect on TAG.

	 	 	 
	 	(s) 	
      Insurance. The TAG Disclosure Letter sets forth
      the details of all policies of insurance in force as of the date hereof
      naming TAG as an insured. Such policies of insurance adequately cover all
      risks reasonably and prudently foreseeable in the operation and conduct of
      the business of TAG and the TAG Subsidiaries. All such policies of
      insurance will remain in full force and effect and will not be cancelled
      or otherwise terminated as a result of the completion of the transactions
      contemplated hereby other than such cancellations as would not,
      individually or in the aggregate, have a Material Adverse Effect on
      TAG.

	 	 	 
	 	(t) 	
      Tax Matters. TAG and the TAG Subsidiaries have
      filed or caused to be filed in a timely manner all material Tax Returns
      required to be filed by them (all of which Tax Returns were correct and
      complete in all material respects) and have paid, collected, withheld or
      remitted, or caused to be paid, collected, withheld or remitted, all Taxes
      that are due and payable, collectible and remittable. TAG has provided
      adequate accruals in accordance with Canadian GAAP in its most recently
      published consolidated financial statements for any Taxes for the period
      covered by such financial statements which have not been paid, whether or
      not shown as being due on any Tax Returns. Since such publication date, no
      material liability for Taxes not reflected in such financial statements or
      otherwise provided for has been assessed, proposed to be assessed,
      incurred or accrued other than in the ordinary course of business. To the
      knowledge of TAG, there are no material proposed (but unassessed)
      additional Taxes and none have been asserted by Canada Customs and Revenue
      Agency, the United States Internal Revenue Service or any other taxing
      authority, including, without limitation, any sales tax authority, in
      connection with any of the Tax Returns referred to above, and no waiver of
      any statute of limitations has been given or requested with respect to TAG
      or any of the TAG Subsidiaries. No lien for Taxes has been filed other
      than for Taxes not yet due and payable.

	 	 	 
	 	(u) 	
      Intellectual Property. To the knowledge of TAG,
      TAG and the TAG Subsidiaries own, or are validly licensed or otherwise
      have the right to use, all patents, patent
rights,

- 28 -

	 		
      trademarks, trade names, service marks, copyrights, know
      how and other proprietary intellectual property rights that are material
      to the conduct of the business of TAG.

	 	 	 	 
	 	(v) 	
      Pension and Employee Benefits.

	 	 	 	 
	 		(i) 	
      TAG and the TAG Subsidiaries have complied, in all
      material respects, with all of the terms of, and all applicable Laws in
      respect of, the pension and other employee compensation and benefit
      obligations of TAG and the TAG Subsidiaries, as the case may be, including
      the provisions of any collective agreements, funding and investment
      contracts or obligations applicable thereto, arising under or relating to
      each of the pension or retirement income plans or other employee
      compensation or benefit plans, agreements, policies, programs,
      arrangements or practices, whether written or oral, which are maintained
      by or binding upon TAG or the TAG Subsidiaries, as the case may be,
      (collectively referred to in this subsection as the “TAG Plans”) and all
      TAG Plans maintained by or binding upon TAG or any of the TAG Subsidiaries
      are fully funded and in good standing with such regulatory authorities as
      may be applicable and no notice of underfunding, non-compliance, failure
      to be in good standing or otherwise has been received by TAG or any of the
      TAG Subsidiaries from any such regulatory authority.

	 	 	 	 
	 		(ii) 	
      No action has been taken, no event has occurred and no
      condition or circumstance exists that has resulted in or could reasonably
      be expected to result in any TAG Plan maintained by or binding upon TAG or
      any of the TAG Subsidiaries being ordered or required to be terminated or
      wound up in whole or in part or having its registration under applicable
      legislation refused or revoked, or being placed under the administration
      of any trustee or receiver or regulatory authority or being required to
      pay any Taxes, fees, penalties or levies under applicable Laws in excess
      of $10,000. There are no actions, suits, claims (other than routine claims
      for payment of benefits in the ordinary course), trials, demands,
      investigations, arbitrations or other proceedings which are pending or
      threatened in respect of any of the TAG Plans maintained by or binding
      upon TAG or any of the TAG Subsidiaries or their respective
  assets.

	 	 	 	 
	 	(w) 	
      Reporting Status. TAG is a reporting issuer or its
      equivalent in each of the provinces of British Columbia and Alberta. The
      TAG Common Shares are listed on the TSX-V.

	 	 	 	 
	 	(x) 	
      Reports. Since April 1, 2009, TAG has filed with
      the Securities Authorities, stock exchanges and all applicable
      self-regulatory authorities a true and complete copy of all forms,
      reports, schedules, statements, certifications, material change reports
      and other documents required to be filed by it (such forms, reports,
      schedules, statements, certifications and other documents, including any
      financial statements or other documents, including any schedules included
      therein, are referred to in this subsection as the “TAG Documents”). The
      TAG Documents, at the time filed, (a) did not contain any
      misrepresentation (as defined in applicable securities Laws) and (b)
      complied in all material respects with the requirements of applicable
      securities legislation. TAG has not filed any confidential material change
      or other report or other document with any Securities Authorities or stock
      exchange or other self-regulatory authority which at the date hereof
      remains confidential.

- 29 -

	 	(y) 	
      Compliance with Laws. TAG and the TAG Subsidiaries
      have complied with and are not in violation of any applicable Law other
      than such non-compliance or violations which would not, individually or in
      the aggregate, have a Material Adverse Effect on TAG.

	 	 	 
	 	(z) 	
      Licences. TAG and each of the TAG Subsidiaries
      owns, possesses, or has obtained and is in compliance with, all licences,
      permits (including licenses and permits required under environmental
      Laws), certificates, orders, grants and other authorizations of or from
      all Governmental Entities necessary to conduct its business as now
      conducted or as proposed to be conducted, the failure to own, possess,
      obtain or be in compliance with which would not individually or in the
      aggregate have a Material Adverse Effect on TAG.

	 	 	 
	 	(aa) 	
      Certain Contracts. Neither TAG nor any of the TAG
      Subsidiaries is a party to or bound by any non-competition agreement or
      any other agreement, obligation, judgment, injunction, order or decree
      which purports to (a) limit the manner or the localities in which all or
      any material portion of the business of TAG (on a consolidated basis) is
      or would be conducted, (b) limit any business practice of TAG (on a
      consolidated basis) or (c) restrict any acquisition or disposition of any
      property by TAG or the TAG Subsidiary.

	 	 	 
	 	(bb) 	
      Investment Company Status. TAG is not registered
      and is not required to be registered as an open-end investment company, a
      closed-end investment company, a unit investment trust or a face-amount
      certificate company under the 1940 Act.

	 	 	 
	 	(cc) 	
      Shares. The TAG Common Shares to be issued
      pursuant to the Arrangement will, upon issue, be issued as fully-paid and
      non-assessable shares.

	 	 	 
	 	(dd) 	
      Certain Securities Law Matters. The TAG Common
      Shares to be issued in connection with the Arrangement will not be subject
      to any statutory hold or restricted period under the securities
      legislation of any province or territory of Canada and, subject to
      restrictions contained therein in respect of distributions by “control
      persons”, will be freely tradable by the holders thereof. The TAG Common
      Shares to be issued in connection with the Arrangement to Trans-Orient
      Shareholders who are residents of the United States of America or who are
      “U.S. persons” within the meaning of Regulation S under the 1933 Act,
      other than persons who are deemed to be affiliates of Trans-Orient for the
      purposes of Rule 145 under the 1933 Act, will be exempt from the
      registration requirements of the 1933 Act pursuant to Section 3(a)(10) of
      the 1933 Act.

	 	 	 
	 	(ee) 	
      Full Disclosure. TAG has made available to
      Trans-Orient all material information, including financial, operational,
      sales and other information, in respect of the business of TAG and the TAG
      Subsidiaries requested by Trans-Orient and all such information as made
      available to Trans-Orient is true and correct in all material respect and
      no material fact or facts have been omitted therefrom which would make
      such information misleading.

	 	 	 
	 	(ff) 	
      Proxy Circular. When mailed, the Proxy Circular
      will not contain an untrue statement of a material fact concerning TAG or
      the TAG Subsidiaries and will not omit to state a material fact concerning
      TAG or the TAG Subsidiaries that is required to be stated or that is
      necessary to make a statement contained therein not misleading in the
      light of the circumstances in which it was
made.

- 30 -

	Section 3.03 	Survival of Representations and
      Warranties 

The representations and warranties contained in this Agreement
shall survive the execution and delivery of this Agreement and shall expire and
be terminated and extinguished on the Effective Date. Any investigation by TAG
or TAG Subco and their advisors shall not mitigate, diminish or affect the
representations and warranties of Trans-Orient contained in this Agreement. Any
investigation by Trans-Orient and its advisors shall not mitigate, diminish or
affect the representations and warranties of TAG contained in this
Agreement.

ARTICLE FOUR 
COVENANTS

	Section 4.01 	Covenants of Trans-Orient

Trans-Orient hereby covenants and agrees that, except as
contemplated by this Agreement or the Plan of Arrangement, until the Effective
Date or the day upon which this Agreement is terminated, whichever is
earlier:

	 	(a) 	
      Interim Order. As soon as practicable,
      Trans-Orient together with TAG Subco shall file, proceed with and
      diligently prosecute an application to the Court for the Interim Order on
      terms and conditions acceptable to the parties hereto, acting
      reasonably.

	 	 	 	 
	 	(b) 	
      Trans-Orient Meeting. In a timely and expeditious
      manner, Trans-Orient shall:

	 	 	 	 
	 		(i) 	
      forthwith carry out such terms of the Interim Order as
      are required under the terms thereof to be carried out by
    Trans-Orient;

	 	 	 	 
	 		(ii) 	
      subject to TAG and TAG Subco complying with Section
      4.02(b), prepare, in consultation with TAG, and file the Proxy Circular
      (which shall be in a form satisfactory to TAG, acting reasonably) in all
      jurisdictions where the Proxy Circular is required to be filed and mail
      the Proxy Circular, as ordered by the Interim Order and in accordance with
      all applicable Laws, in and to all jurisdictions where the Proxy Circular
      is required to be mailed, complying in all material respects with all
      applicable Laws on the date of the mailing thereof and in the form and
      containing the information required by all applicable Laws, including all
      applicable corporate and securities legislation and requirements, and not
      containing any misrepresentation (as defined under applicable securities
      legislation and requirements) with respect thereto;

	 	 	 	 
	 		(iii) 	
      convene the Trans-Orient Meeting as soon as practicable
      and, in any event, as provided in the Interim Order and solicit proxies to
      be voted at the Trans-Orient Meeting in favour of the
  Arrangement;

	 	 	 	 
	 		(iv) 	
      provide notice to TAG of the Trans-Orient Meeting and
      allow representatives of TAG to attend the Trans-Orient Meeting unless
      such attendance is specifically prohibited by the Interim Order;

	 	 	 	 
	 		(v) 	
      conduct the Trans-Orient Meeting in accordance with the
      Interim Order, the BCBCA, the articles of Trans-Orient and as otherwise
      required by applicable Laws; and

- 31 -

	 		(vi) 	
      take all such actions as may be required under the BCBCA
      in connection with the transactions contemplated by this Agreement and the
      Plan of Arrangement.

	 	 	 	 
	 	(c) 	
      Amendments. In a timely and expeditious manner,
      Trans-Orient shall prepare, (in consultation with TAG), and file any
      mutually agreed (or as otherwise required by applicable Laws) amendments
      or supplements to the Proxy Circular (which amendments or supplements
      shall be in a form satisfactory to TAG, acting reasonably) with respect to
      the Trans-Orient Meeting and mail such amendments or supplements, as
      required by the Interim Order and in accordance with all applicable Laws,
      in and to all jurisdictions where such amendments or supplements are
      required to be mailed, complying in all material respects with all
      applicable Laws on the date of the mailing thereof.

	 	 	 	 
	 	(d) 	
      Final Order. Subject to the approval of the
      Arrangement at the Trans-Orient Meeting in accordance with the provisions
      of the Interim Order, Trans-Orient together, if applicable, with TAG Subco
      shall forthwith file, proceed with and diligently prosecute an application
      for the Final Order, which application shall be in a form and substance
      satisfactory to the parties hereto, acting reasonably.

	 	 	 	 
	 	(e) 	
      Arrangement Filings. Trans-Orient shall forthwith
      carry out the terms of the Interim Order and the Final Order and,
      following the issue of the Final Order, the receipt by TAG and TAG Subco
      of written confirmation from Trans-Orient that the conditions in favour of
      Trans-Orient have been satisfied, fulfilled or waived and the receipt by
      Trans-Orient of written confirmation from TAG and TAG Subco that the
      conditions in favour of TAG have been satisfied, fulfilled or waived, and,
      at a time and on a date to be agreed by TAG and Trans-Orient, file the
      Arrangement Filings with the Registrar in order for the Arrangement to
      become effective.

	 	 	 	 
	 	(f) 	
      Copy of Documents. Except for proxies and other
      non-substantive communications, Trans-Orient shall furnish promptly to TAG
      a copy of each notice, report, schedule or other document or communication
      delivered, filed or received by Trans-Orient in connection with this
      Agreement, the Arrangement, the Interim Order or the Trans-Orient Meeting
      or any other meeting at which all Trans-Orient Shareholders are entitled
      to attend, any filings made under any applicable Law and any dealings or
      communications with any regulatory agency in connection with, or in any
      way affecting, the transactions contemplated by this Agreement.

	 	 	 	 
	 	(g) 	
      Usual Business. Except as consented to in writing
      by TAG (such consent not to be unreasonably withheld or delayed) or as
      required to give effect to the transactions contemplated by this
      Agreement, Trans-Orient shall, and shall cause the Trans-Orient
      Subsidiaries to, conduct business only in, and not take any action except
      in, the ordinary course of business and consistent with past
    practice.

	 	 	 	 
	 	(h) 	
      Certain Actions Prohibited. Except as consented to
      in writing by TAG (such consent not to be unreasonably withheld or
      delayed) or as required to give effect to the transactions contemplated by
      this Agreement, Trans-Orient shall not directly or indirectly do or permit
      to occur any of the following:

	 	 	 	 
	 		(i) 	
      issue, sell, pledge, lease, dispose of, encumber or
      create any Encumbrance on or agree to issue, sell, pledge, lease, dispose
      of, or encumber or create any Encumbrance on, or permit the Trans-Orient
      Subsidiaries to issue, sell, pledge, lease, dispose of, encumber or create
      any Encumbrance on or agree to issue, sell, pledge, lease, dispose of, or
      encumber or create any Encumbrance on, any
shares

- 32 -

	 	 		
      of, or any options, warrants, calls, conversion
      privileges or rights of any kind to acquire any shares of, Trans-Orient or
      any of the Trans-Orient Subsidiaries, other than the issue of Trans-Orient
      Common Shares pursuant to the exercise of outstanding Trans-Orient
      Options, or Trans-Orient Warrants in accordance with their terms as of the
      date hereof;

	 	 	 	 
	 	 	(ii) 	
      other than pursuant to obligations or rights under
      existing contracts, agreements and commitments (to the extent such rights
      have been exercised or initiated by other persons), sell, lease or
      otherwise dispose of, or permit any of the Trans- Orient Subsidiaries to
      sell, lease or otherwise dispose of, any material property or assets or
      enter into any agreement or commitment in respect of any of the
      foregoing;

	 	 	 	 
	 	 	(iii) 	
      amend or propose to amend the articles or by-laws (or
      their equivalent) of Trans- Orient or any of the Trans-Orient Subsidiaries
      or any of the terms of the Trans- Orient Options, or Trans-Orient Warrants
      as they exist at the date of this Agreement;

	 	 	 	 
	 	 	(iv) 	
      split, combine or reclassify any of the shares of
      Trans-Orient or any of the Trans- Orient Subsidiaries, or declare, set
      aside or pay any dividend or other distribution payable in cash,
      securities, property or otherwise with respect to the shares of
      Trans-Orient;

	 	 	 	 
	 	 	(v) 	
      redeem, purchase or offer to purchase, or permit any of
      the Trans-Orient Subsidiaries to redeem, purchase or offer to purchase,
      any Trans-Orient Common Shares and, other than pursuant to the
      Trans-Orient Stock Option Plan, any options or obligations or rights under
      existing contracts, agreements and commitments;

	 	 	 	 
	 	 	(vi) 	
      reorganize, amalgamate or merge Trans-Orient or any of
      the Trans-Orient Subsidiaries with any other person;

	 	 	 	 
	 	 	(vii) 	
      acquire or agree to acquire any corporation or other
      entity (or material interest therein) or division of any corporation or
      other entity, or permit any of the Trans- Orient Subsidiaries to acquire
      or agree to acquire any corporation or other entity (or material interest
      therein) or division of any corporation or other entity;

	 	 	 	 
	 	 	(viii) 	
      (A) satisfy or settle any claim or liability, except (x)
      such as have been reserved against in the consolidated financial
      statements of Trans-Orient delivered to TAG and TAG Subco, and which are,
      individually or in the aggregate, in an amount in excess of $50,000, and
      (y) in the ordinary course of business and consistent with past practice;
      (B) relinquish any contractual rights which are, individually or in the
      aggregate, in an amount in excess of $50,000; or (C) enter into any
      interest rate or currency swaps, hedges, caps, collars, forward sales or
      other similar financial instruments;

	 	 	 	 
	 	 	(ix) 	
      incur, authorize, agree or otherwise become committed to
      provide guarantees for borrowed money or to make capital expenditures or
      incur, authorize, agree or otherwise become committed for any indebtedness
      for borrowed money or to make capital expenditures, or permit any of the
      Trans-Orient Subsidiaries to incur, authorize, agree or otherwise become
      committed to provide guarantees for borrowed money or to make capital
      expenditures or incur, authorize, agree or

- 33 -

	 			otherwise become committed for any indebtedness for
      borrowed money or to make capital expenditures in an amount either
      individually or in the aggregate exceeding $20,000; or
	 	 	 	 
	 		(x) 	
      except as required by Canadian GAAP or any applicable
      Law, make any changes to the existing accounting practices of Trans-Orient
      or make any material tax election inconsistent with past
  practice.

	 	 	 	 
	 	(i) 	
      Employment Arrangements. Without the prior written
      consent of TAG, Trans-Orient shall not, and shall cause the Trans-Orient
      Subsidiaries not to, other than in the normal course of business or
      pursuant to existing employment, pension, supplemental pension,
      termination, compensation arrangements or policies, enter into or modify
      any employment, severance, collective bargaining or similar agreement,
      policy or arrangement with, or grant any bonus, salary increase, option to
      purchase shares, pension or supplemental pension benefit, profit sharing,
      retirement allowance, deferred compensation, incentive compensation,
      severance, change of control or termination pay to, or make any loan to,
      any employee, officer or director of Trans-Orient or any of the
      Trans-Orient Subsidiaries.

	 	 	 	 
	 	(j) 	
      Insurance. Trans-Orient shall use its reasonable
      commercial efforts, and shall cause the Trans-Orient Subsidiaries to use
      their reasonable commercial efforts, to cause their respective current
      insurance (or reinsurance) policies not to be cancelled or terminated or
      any of the coverage thereunder to lapse, unless simultaneously with such
      termination, cancellation or lapse, replacement policies underwritten by
      insurance and re-insurance companies of internationally recognized
      standing providing coverage equal to or greater than the coverage under
      the cancelled, terminated or lapsed policies for substantially similar
      premiums are in full force and effect. TAG agrees that Trans-Orient shall
      be able to purchase tail insurance coverage for its directors and officers
      in such amount and on such terms as Trans-Orient may determine, acting
      reasonably, provided that such tail coverage shall not expire until 6
      years after the Effective Time.

	 	 	 	 
	 	(k) 	
      Certain Actions. Trans-Orient shall:

	 	 	 	 
	 		(i) 	
      immediately cease and cause to be terminated any existing
      discussions or negotiations with any persons (other than TAG) with respect
      to any potential Acquisition Proposal (provided that the foregoing shall
      not be applicable to future discussions or negotiations in accordance with
      Article Six), not release any third party from any confidentiality
      agreement to which such third party is a party, not release any third
      party from any standstill agreement to which such third party is a party,
      immediately request the return or destruction of all information provided
      to any third parties who have entered into a confidentiality agreement
      with it or any of the Trans-Orient Subsidiaries relating to a potential
      Acquisition Proposal and use all reasonable efforts to ensure that such
      requests are honoured;

	 	 	 	 
	 		(ii) 	
      except as contemplated pursuant to Article Six, not take
      any action or permit any of the Trans-Orient Subsidiaries to take any
      action that would interfere with or be inconsistent with the completion of
      the transactions contemplated by this Agreement or would render, or that
      reasonably may be expected to render, any representation or warranty made
      by Trans-Orient in this Agreement untrue or inaccurate at any time prior
      to the Effective Time if then made; and

- 34 -

	 		(iii) 	
      promptly notify TAG of (A) any Material Adverse Change or
      Material Adverse Effect, or any change, event, occurrence or state of
      facts which could reasonably be expected to become a Material Adverse
      Change or to have a Material Adverse Effect, in respect of the business or
      in the conduct of the business of Trans- Orient, (B) any material
      Governmental Entity or third person complaints, investigations or hearings
      (or communications indicating that the same may be contemplated), (C) any
      breach by Trans-Orient of any covenant or agreement contained in this
      Agreement, and (D) any event occurring subsequent to the date hereof that
      would render any representation or warranty of Trans-Orient contained in
      this Agreement, if made on or as of the date of such event or the
      Effective Date, to be untrue or inaccurate.

	 	 	 	 
	 	(l) 	
      No Compromise. Trans-Orient shall not, and shall
      cause the Trans-Orient Subsidiaries not to, settle or compromise any claim
      brought by any present, former or purported holder of any securities of
      Trans-Orient in connection with the transactions contemplated by this
      Agreement prior to the Effective Time without the prior written consent of
      TAG, such consent not to be unreasonably withheld or delayed.

	 	 	 	 
	 	(m) 	
      Contractual Obligations. Except (i) in the
      ordinary course of business and consistent with past practice, or (ii) as
      required by applicable Laws, Trans-Orient shall not, and shall cause the
      Trans-Orient Subsidiaries not to, enter into, renew or modify in any
      respect any material contract, agreement, lease, commitment or arrangement
      to which Trans-Orient or any of the Trans-Orient Subsidiaries is a party
      or by which any of them is bound.

	 	 	 	 
	 	(n) 	
      Satisfaction of Conditions. Trans-Orient shall use
      all commercially reasonable efforts to satisfy, or cause to be satisfied,
      all conditions precedent to its obligations and the obligations of TAG and
      TAG Subco hereunder set forth in Article Five hereof to the extent that
      the same is within its control and to take, or cause to be taken, all
      other action and to do, or cause to be done, all other things necessary,
      proper or advisable under all applicable Laws to complete the transactions
      contemplated by this Agreement, including using its commercially
      reasonable efforts to:

	 	 	 	 
	 		(i) 	
      obtain the approval of Trans-Orient Shareholders for the
      Arrangement in accordance with the provisions of the BCBCA, the Interim
      Order and the requirements of any applicable regulatory authority, subject
      to the proviso set forth in Section 6.01(a) hereof;

	 	 	 	 
	 		(ii) 	
      obtain all other consents, approvals and authorizations
      as are required to be obtained by Trans-Orient or any of the Trans-Orient
      Subsidiaries under any applicable Law or from any Governmental Entity
      which would, if not obtained, materially impede the completion of the
      transactions contemplated by this Agreement or have a Material Adverse
      Effect on Trans-Orient;

	 	 	 	 
	 		(iii) 	
      effect all necessary registrations, filings and
      submissions of information requested by Governmental Entities required to
      be effected by it in connection with the transactions contemplated by this
      Agreement and participate, and appear in any proceedings of, any party
      hereto before any Governmental Entity;

	 	 	 	 
	 		(iv) 	
      oppose, lift or rescind any injunction or restraining
      order or other order or action challenging or affecting this Agreement,
      the transactions contemplated hereby or seeking to stop, or otherwise
      adversely affecting the ability of the parties hereto to consummate, the
      transactions contemplated hereby;

- 35 -

	 		(v) 	
      fulfill all conditions and satisfy all provisions of this
      Agreement and the Plan of Arrangement required to be fulfilled or
      satisfied by Trans-Orient; and

	 	 	 	 
	 		(vi) 	
      cooperate with TAG and TAG Subco in connection with the
      performance by each of them of their respective obligations
    hereunder.

	 	 	 	 
	 	(o) 	
      Refrain from Certain Actions. Trans-Orient shall
      not take any action, refrain from taking any action (subject to
      commercially reasonable efforts), or permit any action to be taken or not
      taken, inconsistent with the provisions of this Agreement or which would
      reasonably be expected to materially impede the completion of the
      transactions contemplated hereby or which would or could have a Material
      Adverse Effect on Trans- Orient, provided that where Trans-Orient is
      required to take any such action or refrain from taking such action
      (subject to commercially reasonable efforts) as a result of this
      Agreement, Trans-Orient shall immediately notify TAG in writing of such
      circumstances.

	 	 	 	 
	 	(p) 	
      Keep Fully Informed. Without limiting the
      provisions of Section 4.01(h) hereof, Trans- Orient shall, in all material
      respects, conduct itself so as to keep TAG fully informed as to the
      material decisions or actions required or required to be made with respect
      to the operation of its business.

	 	 	 	 
	 	(q) 	
      Cooperation. Trans-Orient shall assist and
      cooperate in the preparation and filing with all applicable Securities
      Authorities of all necessary applications to seek exemptions, if required,
      from the prospectus, registration and other requirements of applicable
      securities laws of the provinces of Canada and the United States for the
      issue by TAG of its securities pursuant to the Arrangement and the resale
      of such securities (including the resale of any underlying securities) in
      the provinces of Canada (subject to requirements of general
      application).

	 	 	 	 
	 	(r) 	
      Representations. Trans-Orient shall use its
      commercially reasonable efforts to conduct its affairs and to cause the
      Trans-Orient Subsidiaries to conduct their affairs so that all of the
      representations and warranties of Trans-Orient contained herein shall be
      true and correct on and as of the Effective Date as if made on and as of
      such date.

	 	 	 	 
	 	(s) 	
      Information. Subject to the terms and conditions
      of the Confidentiality Agreement, Trans-Orient shall make available and
      cause to be made available to TAG and the agents and advisors thereto all
      documents, agreements, corporate records and minute books as may be
      necessary to enable TAG to effect a thorough examination of Trans-Orient
      and the Trans-Orient Subsidiaries and the business, properties and
      financial status thereof and shall cooperate with TAG in securing access
      for TAG to any documents, agreements, corporate records or minute books
      not in the possession or under the control of Trans- Orient. Subject to
      applicable Laws, upon reasonable notice, Trans-Orient shall, and shall
      cause the Trans-Orient Subsidiaries to, afford officers, employees,
      counsel, accountants and other authorized representatives and advisors of
      TAG reasonable access, during normal business hours from the date hereof
      until the earlier of the Effective Time and the termination of this
      Agreement, to the properties, books, contracts and records as well as to
      the management personnel of Trans-Orient and the Trans-Orient
      Subsidiaries, and, during such period, Trans-Orient shall, and shall cause
      the Trans-Orient Subsidiaries to, furnish promptly to TAG all information
      concerning the business, properties and personnel of Trans-Orient and the
      Trans-Orient Subsidiaries as TAG may reasonably
request.

- 36 -

	 	(t) 	
      Closing Documents. Trans-Orient shall execute and
      deliver, or cause to be executed and delivered, at the closing of the
      transactions contemplated hereby such customary agreements, certificates,
      resolutions, opinions and other closing documents as may be required by
      the other parties hereto, all in form satisfactory to the other parties
      hereto, acting reasonably.

	Section 4.02 	Covenants of TAG 

Each of TAG and TAG Subco hereby covenants and agrees that,
except as contemplated by this Agreement or the Plan of Arrangement, until the
Effective Date or the day upon which this Agreement is terminated, whichever is
earlier:

	 	(a) 	
      Proceedings. In a timely and expeditious manner,
      TAG and TAG Subco shall:

	 	 	 	 
	 		(i) 	
      assist and cooperate in the application to the Court for
      the Interim Order;

	 	 	 	 
	 		(ii) 	
      subject to the approval of the Arrangement at the
      Trans-Orient Meeting in accordance with the provisions of the Interim
      Order, assist and cooperate in the application to the Court for the Final
      Order; and

	 	 	 	 
	 		(iii) 	
      take all such actions and do all such acts and things as
      are specified in the Interim Order, the Plan of Arrangement and the Final
      Order to be taken or done by TAG and TAG Subco, as applicable.

	 	 	 	 
	 	(b) 	
      Proxy Circular. In a timely and expeditious
      manner, TAG and TAG Subco shall provide to Trans-Orient all information as
      may be reasonably requested by Trans-Orient or as required by the Interim
      Order or applicable Laws with respect to TAG and TAG Subco and their
      respective businesses and properties for inclusion in the Proxy Circular
      or in any amendment or supplement to the Proxy Circular which complies in
      all material respects with all applicable Laws on the date of the mailing
      thereof and containing all material facts relating to TAG and TAG Subco
      required to be disclosed in the Proxy Circular and not containing any
      misrepresentation (as defined under applicable securities legislation)
      with respect thereto.

	 	 	 	 
	 	(c) 	
      Copy of Documents. Except for non-substantive
      communications, TAG and TAG Subco shall furnish promptly to Trans-Orient a
      copy of each notice, report, schedule or other document or communication
      delivered, filed or received by TAG and TAG Subco in connection with the
      Arrangement or the Interim Order, any filing under any applicable Law and
      any dealings or communications with any regulatory agency in connection
      with, or in any way affecting, the transactions contemplated by this
      Agreement.

	 	 	 	 
		(d) 	
      Usual Business. Except (i) in connection with the
      completion of the Cheal Acquisition,  (ii) the conduct of any normal
      course issuer bid in accordance with the rules of the TSX-V, and (iii) as
      consented to in writing by Trans-Orient (such consent not to be
      unreasonably withheld or delayed) or as required to give effect to the
      transactions contemplated by this Agreement, TAG shall, and shall cause
      the TAG Subsidiaries to, conduct business only in, and not take any action
      except in, the ordinary course of business and consistent with past
      practice.

	 	 	 	 
	 	(e) 	
      Certain Actions Prohibited. Except (i) in
      connection with the completion of the Cheal Acquisition, (ii) the conduct
      of any normal course issuer bid in accordance with the rules of the TSX-V,
      and (iii) as consented to in writing by Trans-Orient (such consent not to
      be

- 37 -

unreasonably withheld or delayed) or
as required to give effect to the transactions contemplated by this Agreement,
TAG shall not directly or indirectly do or permit to occur any of the
following:

	 	(i) 	
      issue, sell, pledge, lease, dispose of, encumber or
      create any Encumbrance on or agree to issue, sell, pledge, lease, dispose
      of, or encumber or create any Encumbrance on, or permit the TAG
      Subsidiaries to issue, sell, pledge, lease, dispose of, encumber or create
      any Encumbrance on or agree to issue, sell, pledge, lease, dispose of, or
      encumber or create any Encumbrance on, any shares of, or any options,
      warrants, calls, conversion privileges or rights of any kind to acquire
      any shares of, TAG or any of the TAG Subsidiaries, other than the issue of
      TAG Common Shares pursuant to the exercise of outstanding options to
      purchase TAG Common Shares pursuant to the stock option plan of TAG in
      accordance with their terms as of the date hereof;

	 	 	 
	 	(ii) 	
      other than pursuant to obligations or rights under
      existing contracts, agreements and commitments (to the extent such rights
      have been exercised or initiated by other persons), sell, lease or
      otherwise dispose of, or permit any of the TAG Subsidiaries to sell, lease
      or otherwise dispose of, any material property or assets or enter into any
      agreement or commitment in respect of any of the foregoing;

	 	 	 
	 	(iii) 	
      amend or propose to amend the articles or by-laws (or
      their equivalent) of TAG or any of the TAG Subsidiaries or any of the
      terms of options to purchase TAG Common Shares issued pursuant to the
      stock option plan of TAG as they exist at the date of this
    Agreement;

	 	 	 
	 	(iv) 	
      split, combine or reclassify any of the shares of TAG or
      any of the TAG Subsidiaries or declare, set aside or pay any dividend or
      other distribution payable in cash, securities, property or otherwise with
      respect to the shares of TAG;

	 	 	 
	 	(v) 	
      redeem, purchase or offer to purchase, or permit any of
      the TAG Subsidiaries to redeem, purchase or offer to purchase, any TAG
      Common Shares and, other than pursuant to the stock option plan of TAG,
      any options or obligations or rights under existing contracts, agreements
      and commitments;

	 	 	 
	 	(vi) 	
      reorganize, amalgamate or merge TAG or any of the TAG
      Subsidiaries with any other person;

	 	 	 
	 	(vii) 	
      acquire or agree to acquire any corporation or other
      entity (or material interest therein) or division of any corporation or
      other entity, or permit any of the TAG Subsidiaries to acquire or agree to
      acquire any corporation or other entity (or material interest therein) or
      division of any corporation or other entity;

	 	 	 
	 	(viii) 	
      (A) satisfy or settle any claim or liability, except (x)
      such as have been reserved against in the consolidated financial
      statements of TAG delivered to Trans- Orient, and which are, individually
      or in the aggregate, in an amount in excess of $50,000, and (y) in the
      ordinary course of business and consistent with past practice; (B)
      relinquish any contractual rights which are, individually or in the
      aggregate, in an amount in excess of $50,000; or (C) enter into any
      interest rate or currency swaps, hedges, caps, collars, forward sales or
      other similar financial instruments;

- 38 -

	 		(ix) 	
      incur, authorize, agree or otherwise become committed to
      provide guarantees for borrowed money or to make capital expenditures or
      incur, authorize, agree or otherwise become committed for any indebtedness
      for borrowed money or to make capital expenditures, or permit any of the
      TAG Subsidiaries to incur, authorize, agree or otherwise become committed
      to provide guarantees for borrowed money or to make capital expenditures
      or incur, authorize, agree or otherwise become committed for any
      indebtedness for borrowed money or to make capital expenditures in an
      amount either individually or in the aggregate exceeding $20,000;
  or

	 	 	 	 
	 		(x) 	
      except as required by Canadian GAAP or any applicable
      Law, make any changes to the existing accounting practices of TAG or make
      any material tax election inconsistent with past practice.

	 	 	 	 
	 	(f) 	
      Employment Arrangements. Without the prior written
      consent of Trans-Orient, TAG shall not, and shall cause the TAG
      Subsidiaries not to, other than in the normal course of business or
      pursuant to existing employment, pension, supplemental pension,
      termination, compensation arrangements or policies, enter into or modify
      any employment, severance, collective bargaining or similar agreement,
      policy or arrangement with, or grant any bonus, salary increase, option to
      purchase shares, pension or supplemental pension benefit, profit sharing,
      retirement allowance, deferred compensation, incentive compensation,
      severance, change of control or termination pay to, or make any loan to,
      any employee, officer or director of TAG or any of the TAG
      Subsidiaries.

	 	 	 	 
	 	(g) 	
      Insurance. TAG shall use its reasonable commercial
      efforts and shall cause the TAG Subsidiaries to use their reasonable
      commercial efforts, to cause their respective current insurance (or
      reinsurance) policies not to be cancelled or terminated or any of the
      coverage thereunder to lapse, unless simultaneously with such termination,
      cancellation or lapse, replacement policies underwritten by insurance and
      re-insurance companies of internationally recognized standing providing
      coverage equal to or greater than the coverage under the cancelled,
      terminated or lapsed policies for substantially similar premiums are in
      full force and effect.

	 	 	 	 
	 	(h) 	
      Certain Actions. TAG and TAG Subco
shall:

	 	 	 	 
	 		(i) 	
      immediately cease and cause to be terminated any existing
      discussions or negotiations with any persons (other than Trans-Orient)
      with respect to any potential Acquisition Proposal (provided that the
      foregoing shall not be applicable to future discussions or negotiations in
      accordance with Article Six), not release any third party from any
      confidentiality agreement to which such third party is a party, not
      release any third party from any standstill agreement to which such third
      party is a party, immediately request the return or destruction of all
      information provided to any third parties who have entered into a
      confidentiality agreement with it or any of the TAG Subsidiaries relating
      to a potential Acquisition Proposal and use all reasonable efforts to
      ensure that such requests are honoured;

	 	 	 	 
	 		(ii) 	
      except as contemplated pursuant to Article Six, not take
      any action or permit any of the TAG Subsidiaries to take any action that
      would interfere with or be inconsistent with the completion of the
      transactions contemplated by this Agreement or would render, or that
      reasonably may be expected to render, any

- 39 -

	 			representation or warranty made by TAG in this Agreement
      untrue or inaccurate at any time prior to the Effective Time if then made;
      and
	 	 	 	 
	 		(iii) 	
      promptly notify Trans-Orient of (A) any Material Adverse
      Change or Material Adverse Effect, or any change, event, occurrence or
      state of facts which could reasonably be expected to become a Material
      Adverse Change or to have a Material Adverse Effect, in respect of the
      business or in the conduct of the business of TAG, (B) any material
      Governmental Entity or third person complaints, investigations or hearings
      (or communications indicating that the same may be contemplated), (C) any
      breach by TAG of any covenant or agreement contained in this Agreement,
      and (D) any event occurring subsequent to the date hereof that would
      render any representation or warranty of TAG or TAG Subco contained in
      this Agreement, if made on or as of the date of such event or the
      Effective Date, to be untrue or inaccurate.

	 	 	 	 
	 	(i) 	
      No Compromise. TAG shall not, and shall cause the
      TAG Subsidiaries not to, settle or compromise any claim brought by any
      present, former or purported holder of any securities of TAG in connection
      with the transactions contemplated by this Agreement prior to the
      Effective Time without the prior written consent of Trans-Orient, such
      consent not to be unreasonably withheld or delayed.

	 	 	 	 
	 	(j) 	
      Contractual Obligations. Except: (i) for customer
      contracts, (ii) in the ordinary course of business and consistent with
      past practice, or (iii) as required by applicable Laws, TAG shall not, and
      shall cause the TAG Subsidiaries not to, enter into, renew or modify in
      any respect any material contract, agreement, lease, commitment or
      arrangement to which TAG or any of the TAG Subsidiaries is a party or by
      which any of them is bound.

	 	 	 	 
	 	(k) 	
      Satisfaction of Conditions. TAG and TAG Subco
      shall use all commercially reasonable efforts to satisfy, or cause to be
      satisfied, all of the conditions precedent to their obligations and the
      obligations of Trans-Orient hereunder set forth in Article Five hereof to
      the extent the same is within their control and to take, or cause to be
      taken, all other actions and to do, or cause to be done, all other things
      necessary, proper or advisable under all applicable Laws to complete the
      transactions contemplated by this Agreement, including using their
      commercially reasonable efforts to:

	 	 	 	 
	 		(i) 	
      obtain all consents, approvals and authorizations as are
      required to be obtained by TAG or any of the TAG Subsidiaries under any
      applicable Law or from any Governmental Entity which would, if not
      obtained, materially impede the completion of the transactions
      contemplated hereby or have a Material Adverse Effect on TAG;

	 	 	 	 
	 		(ii) 	
      effect all necessary registrations, filings and
      submissions of information requested by Governmental Entities required to
      be effected by them in connection with the transactions contemplated by
      this Agreement and participate, and appear in any proceedings of, any
      party hereto before any Governmental Entity;

	 	 	 	 
	 		(iii) 	
      oppose, lift or rescind any injunction or restraining
      order or other order or action challenging or affecting this Agreement,
      the transactions contemplated hereby or seeking to stop, or otherwise
      adversely affecting the ability of the parties hereto to consummate, the
      transactions contemplated hereby;

- 40 -

	 		(iv) 	
      fulfill all conditions and satisfy all provisions of this
      Agreement and the Plan of Arrangement required to be fulfilled or
      satisfied by them; and

	 	 	 	 
	 		(v) 	
      cooperate with Trans-Orient in connection with the
      performance by Trans-Orient of its obligations hereunder.

	 	 	 	 
	 	(l) 	
      Refrain from Certain Actions. TAG and TAG Subco
      shall not take any action, refrain from taking any action (subject to
      commercially reasonable efforts), or permit any action to be taken or not
      taken, inconsistent with the provisions of this Agreement or which would
      reasonably be expected to materially impede the completion of the
      transactions contemplated hereby or which would or could have a Material
      Adverse Effect on TAG, provided that where TAG or TAG Subco is required to
      take any such action or refrain from taking such action (subject to
      commercially reasonable efforts) as a result of this Agreement, they shall
      immediately notify Trans-Orient in writing of such
circumstances.

	 	 	 	 
	 	(m) 	
      Keep Fully Informed. Without limiting the
      provisions of subsection Section 4.02(e) hereof, TAG shall, in all
      material respects, conduct itself so as to keep Trans-Orient fully
      informed as to the material decisions or actions required or required to
      be made with respect to the operation of its business.

	 	 	 	 
	 	(n) 	
      Cooperation. TAG and TAG Subco shall prepare and
      file with all applicable Securities Authorities all necessary applications
      to seek exemptions, if required, from the prospectus, registration and
      other requirements of applicable securities laws of the provinces of
      Canada and the United States for the issue by TAG of its securities
      pursuant to the Arrangement and the resale of such securities (including
      the resale of any underlying securities) in the provinces of Canada
      (subject to requirements of general application).

	 	 	 	 
	 	(o) 	
      Representations. TAG and TAG Subco shall use
      commercially reasonable efforts to conduct their affairs and to cause the
      TAG Subsidiaries to conduct their affairs so that all of the
      representations and warranties of TAG and TAG Subco contained herein shall
      be true and correct on and as of the Effective Date as if made on and as
      of such date.

	 	 	 	 
	 	(p) 	
      Information. Subject to the terms and conditions
      of the Confidentiality Agreement, TAG and TAG Subco shall make available
      and cause to be made available to Trans-Orient and the agents and advisors
      thereto all documents, agreements, corporate records and minute books as
      may be necessary to enable Trans-Orient to effect a thorough examination
      of TAG and the TAG Subsidiaries and the business, properties and financial
      status thereof and shall cooperate with Trans-Orient in securing access
      for Trans-Orient to any documents, agreements, corporate records or minute
      books not in the possession or under the control of TAG or TAG Subco.
      Subject to applicable Laws, upon reasonable notice, TAG and TAG Subco
      shall, and shall cause the TAG Subsidiaries to, afford officers,
      employees, counsel, accountants and other authorized representatives and
      advisors of Trans-Orient reasonable access, during normal business hours
      from the date hereof until the earlier of the Effective Time and the
      termination of this Agreement, to the properties, books, contracts and
      records as well as to the management personnel of TAG and the TAG
      Subsidiaries, and, during such period, TAG and TAG Subco shall, and shall
      cause the TAG Subsidiaries to, furnish promptly to Trans-Orient all
      information concerning the business, properties and personnel of TAG and
      the TAG Subsidiaries as Trans-Orient may reasonably
  request.

- 41 -

	 	(q) 	
      Closing Documents. TAG shall execute and deliver,
      or cause to be executed and delivered at the closing of the transactions
      contemplated hereby such customary agreements, certificates, opinions,
      resolutions and other closing documents as may be required by
      Trans-Orient, all in form satisfactory to Trans-Orient, acting
      reasonably.

	Section 4.03 	Additional Covenants of TAG
  

	 	(a) 	
      TAG covenants and agrees that, for the entire period from
      the Effective Time until six years after the Effective Time it will
      maintain Trans-Orient’s directors and officers liability insurance
      coverage for the current and former directors and officers of Trans-
      Orient and the Trans-Orient Subsidiaries covering claims made prior to or
      within six years from and after the Effective Time; provided, however,
      that TAG will not be required, in order to maintain or cause to be
      maintained such directors’ and officers’ liability insurance policy, to
      pay an annual premium in excess of 200% of such amount. Furthermore, prior
      to the Effective Time, TAG may, in the alternative, purchase pre-paid,
      non-cancellable run off directors’ and officers’ liability insurance for a
      period of six years from the Effective Time provided that the premium will
      not exceed 200% of the premium currently charged to TAG for directors’ and
      officers’ liability insurance and, in such event, TAG will have no further
      obligation under this Section 4.03.

	 	 	 
	 	(b) 	
      TAG covenants and agrees that for the entire period from
      the Effective Time until six years after the Effective Time, it shall
      cause Trans-Orient (or its successor) to fulfil its obligations pursuant
      to indemnities provided or available to past directors and officers of
      Trans-Orient pursuant to its provisions of the articles of Trans-Orient,
      applicable corporate legislation and any written indemnify
    agreements.

	Section 4.04 	Successors 

The provisions of Section 4.03 are (i) intended for the benefit
of all present and former officers and directors of Trans-Orient and its
Subsidiaries, as and to the extent applicable in accordance with its terms, and
shall be enforceable by each such person and his or her heir, executors,
administrators and other legal representatives (collectively, the “Third Party
Beneficiaries”) and Trans-Orient and any successors shall hold the rights and
benefits of Section 4.03 in trust for and on behalf of the Third Party
Beneficiaries and Trans-Orient and any successor hereby accepts such trust and
agrees to hold the benefit of and enforce performance of such covenants on
behalf of Third Party Beneficiaries, and (ii) are in addition to and not in
substitution for, any other rights that the Third Party Beneficiaries may have
by contract or otherwise.

	Section 4.05 	Merger of Covenants 

The covenants set out in this Agreement, except for Section
2.07, Section 4.03 and Section 4.04, shall not survive the completion of the
Arrangement, and shall expire and be terminated without recourse between the
parties upon such completion.

ARTICLE FIVE 
CONDITIONS

	Section 5.01 	Mutual Conditions 

The respective obligations of Trans-Orient, TAG and TAG Subco
to complete the transactions contemplated herein are subject to the fulfilment
of the following conditions at or before the Effective Time or such other time
as is specified below:

- 42 -

	 	(a) 	
      the Interim Order shall have been granted in form and
      substance satisfactory to the parties hereto, acting reasonably, and shall
      not have been set aside or modified in a manner unacceptable to the
      parties hereto, acting reasonably, on appeal or otherwise;

	 	 	 
	 	(b) 	
      the Arrangement, with or without amendment, shall have
      been approved at the Meeting by the Trans-Orient Shareholders in
      accordance with the provisions of the BCBCA, the Interim Order and the
      requirements of any applicable regulatory authority;

	 	 	 
	 	(c) 	
      the Final Order shall have been granted in form and
      substance satisfactory to the parties hereto, acting reasonably, and shall
      not have been set aside or modified in a manner unacceptable to such
      parties, acting reasonably, on appeal or otherwise;

	 	 	 
	 	(d) 	
      the Arrangement Filings shall be in form and substance
      satisfactory to the parties hereto, acting reasonably;

	 	 	 
	 	(e) 	
      the Effective Date shall be on or before the Completion
      Deadline, subject to any extension mutually agreed to in writing by the
      parties;

	 	 	 
	 	(f) 	
      there shall not be in force any Law, ruling, order or
      decree, and there shall not have been any action taken under any Law or by
      any Governmental Entity or other regulatory authority, that makes it
      illegal or otherwise directly or indirectly restrains, enjoins or
      prohibits the consummation of the Arrangement in accordance with the terms
      hereof or results or could reasonably be expected to result in a judgment,
      order, decree or assessment of damages, directly or indirectly, relating
      to the Arrangement which has, or could have, a Material Adverse Effect on
      Trans-Orient or TAG each on a consolidated basis;

	 	 	 
	 	(g) 	
      the TSX-V shall have conditionally approved the listing
      thereon of the TAG Common Shares to be issued pursuant to the Arrangement
      (including the TAG Common Shares which, as a result of the Arrangement,
      are issuable upon the exercise of the Trans-Orient Options and
      Trans-Orient Warrants) as of the Effective Date, or as soon as possible
      thereafter, subject to compliance with the usual requirements of the
      TSX-V, and the resale of such TAG Common Shares shall not be subject to
      any hold or restricted period (except for any resale that would constitute
      a “control distribution” as defined in Multilateral Instrument 45-102 –
      Resale of Securities);

	 	 	 
	 	(h) 	
      all consents, waivers, permits, exemptions, orders and
      approvals of, and any registrations and filings with, any Governmental
      Entity (other than as contemplated in Section 5.01(a) hereof) and the
      expiry of any waiting periods, in connection with, or required to permit,
      the completion of the Arrangement, the failure of which to obtain or the
      non-expiry of which would or could have a Material Adverse Effect on
      Trans-Orient, TAG or TAG Subco or materially impede the completion of the
      Arrangement, shall have been obtained or received on terms that are
      reasonably satisfactory to each party hereto;

	 	 	 
	 	(i) 	
      without limiting the scope of the foregoing conditions,
      all regulatory, third person and other consents, waivers, permits,
      exemptions, orders, approvals, agreements and amendments and modifications
      to agreements, indentures or arrangements which either Trans-Orient or TAG
      shall consider necessary or desirable in connection with the Arrangement
      shall have been obtained in form satisfactory to them; and

	 	 	 
	 	(j) 	
      this Agreement shall not have been terminated pursuant to
      Article Seven hereof.

- 43 -

The foregoing conditions are for the mutual benefit of the
parties hereto and may be waived in respect of a party hereto, in whole or in
part, by such party hereto in writing at any time. If any of such conditions
shall not be complied with or waived as aforesaid on or before the Completion
Deadline or, if earlier, the date required for the performance thereof, then any
party hereto may terminate this Agreement by written notice to the others of
them in circumstances where the failure to satisfy any such condition is not the
result, directly or indirectly, of a breach of this Agreement by such rescinding
party hereto.

	Section 5.02 	Trans-Orient Conditions

The obligation of Trans-Orient to complete the transactions
contemplated herein is subject to the fulfilment of the following additional
conditions at or before the Effective Time or such other time as is specified
below:

	 	(a) 	
      the representations and warranties made by TAG and TAG
      Subco in this Agreement which are qualified by the expression “Material
      Adverse Change” or “Material Adverse Effect” shall be true and correct as
      of the Effective Date as if made on and as of such date (except to the
      extent that such representations and warranties speak as of an earlier
      date, in which event such representations and warranties shall be true and
      correct as of such earlier date), and all other representations and
      warranties made by TAG and TAG Subco in this Agreement shall be true and
      correct in all material respects as of the Effective Date as if made on
      and as of such date (except to the extent that such representations and
      warranties speak as of an earlier date, in which event such
      representations and warranties shall be true and correct as of such
      earlier date), and TAG shall have provided to Trans- Orient a certificate
      of two officers thereof, and TAG Subco shall have provided to Trans-
      Orient a certificate of an officer thereof, certifying such accuracy on
      the Effective Date;

	 	 	 
	 	(b) 	
      TAG shall have complied in all material respects with its
      covenants herein and TAG shall have provided to Trans-Orient a certificate
      of two officers thereof, and TAG Subco shall have provided to Trans-Orient
      a certificate of an officer thereof, certifying that they have so complied
      with their covenants herein;

	 	 	 
	 	(c) 	
      the board of directors of Trans-Orient shall have
      received a written opinion from its financial advisors opining that the
      exchange ratio in respect of the Arrangement is fair from a financial
      point of view, to the Trans-Orient Shareholders, and such opinion shall
      not have been withdrawn;

	 	 	 
	 	(d) 	
      the directors of TAG and each of the TAG Subsidiaries
      shall have adopted all necessary resolutions and all other necessary
      corporate action shall have been taken by TAG and the TAG Subsidiaries to
      permit the consummation of the Arrangement (including, without limitation,
      the resolutions and corporate actions, as well as the conditional
      resignations of TAG directors, to enable the TAG board of directors to be
      reconstituted as contemplated by Section 2.08);

	 	 	 
	 	(e) 	
      there shall have been no Material Adverse Change with
      respect to TAG or TAG Subco;

	 	 	 
	 	(f) 	
      all of the employees (and officers) of Trans-Orient shall
      have been terminated and paid all accrued compensation and all severance
      amounts in accordance with their respective employment agreements or
      applicable law; and

	 	 	 
	 	(g) 	
      TAG shall have acquired the remaining 69.5% interest in
      the Cheal asset (PMP 38156-S and PEP 38738-01) that it does not already
      own from the receiver of Austral Pacific Energy Ltd. (the “Cheal
      Acquisition”)

- 44 -

The foregoing conditions are for the benefit of Trans-Orient
and may be waived, in whole or in part, by Trans-Orient in writing at any time.
If any of such conditions shall not be complied with or waived by Trans-Orient
on or before the Completion Deadline or, if earlier, the date required for the
performance thereof, then Trans-Orient may terminate this Agreement by written
notice to TAG and TAG Subco in circumstances where the failure to satisfy any
such condition is not the result, directly or indirectly, of a breach of this
Agreement by Trans-Orient.

	Section 5.03 	TAG and TAG Subco Conditions
  

The obligation of TAG to complete the transactions contemplated
herein is subject to the fulfilment of the following additional conditions at or
before the Effective Time or such other time as is specified below:

	 	(a) 	
      the representations and warranties made by Trans-Orient
      in this Agreement which are qualified by the expression “Material Adverse
      Change” or “Material Adverse Effect” shall be true and correct as of the
      Effective Date as if made on and as of such date (except to the extent
      that such representations and warranties speak as of an earlier date, in
      which event such representations and warranties shall be true and correct
      as of such earlier date), and all other representations and warranties
      made by Trans-Orient in this Agreement which are not so qualified shall be
      true and correct in all material respects as of the Effective Date as if
      made on and as of such date (except to the extent that such
      representations and warranties speak as of an earlier date, in which event
      such representations and warranties shall be true and correct as of such
      earlier date), and Trans-Orient shall have provided to each of TAG and TAG
      Subco a certificate of two officers thereof certifying such accuracy on
      the Effective Date;

	 	 	 
	 	(b) 	
      Trans-Orient shall have complied in all material respects
      with its covenants herein and Trans-Orient shall have provided to each of
      TAG and TAG Subco a certificate of two officers thereof certifying that
      Trans-Orient has so complied with its covenants herein;

	 	 	 
	 	(c) 	
      the Lock-up Agreements shall have been entered into
      substantially in the form attached hereto as Schedule B;

	 	 	 
	 	(d) 	
      Trans-Orient Shareholders holding in the aggregate 5 per
      cent or less of the outstanding Trans-Orient Common Shares shall have
      exercised the right to dissent contemplated by Section 5.01 of the Plan of
      Arrangement and TAG shall have received a certificate dated the day
      immediately preceding the Effective Date of an officer of Trans-Orient to
      such effect;

	 	 	 
	 	(e) 	
      the directors of Trans-Orient and each of the
      Trans-Orient Subsidiaries shall have adopted all necessary resolutions and
      all other necessary corporate action shall have been taken by Trans-Orient
      and the Trans-Orient Subsidiaries to permit the consummation of the
      Arrangement;

	 	 	 
	 	(f) 	
      there shall have been no Material Adverse Change with
      respect to Trans-Orient;

	 	 	 
	 	(g) 	
      all of the directors of Trans-Orient shall have executed
      resignations and mutual releases in a form acceptable to TAG and
      Trans-Orient, acting reasonably;

	 	 	 
	 	(h) 	
      all of the employees (and officers) of Trans-Orient shall
      have been terminated; and

	 	 	 
	 	(i) 	
      the TSX-V shall have conditionally approved the listing
      thereon of the TAG Common Shares to be issued pursuant to the Arrangement
      in accordance with Section 5.01 hereof

- 45 -

and without requiring TAG to obtain
shareholder approval for the issuance of such shares.

The foregoing conditions are for the benefit of TAG and TAG
Subco and may be waived, in whole or in part, by TAG and TAG Subco in writing at
any time. If any of such conditions shall not be complied with or waived by TAG
and TAG Subco on or before the Completion Deadline or, if earlier, the date
required for the performance thereof, then, TAG and TAG Subco may terminate this
Agreement by written notice to Trans-Orient in circumstances where the failure
to satisfy any such condition is not the result, directly or indirectly, of a
breach of this Agreement by TAG or TAG Subco.

	Section 5.04 	Notice and Cure Provisions

Each party hereto shall give prompt notice to the others of
them of the occurrence, or failure to occur, at any time from the date hereof
until the Effective Date, of any event or state of facts which occurrence or
failure would or would be likely to:

	 	(a) 	
      cause any of the representations or warranties of such
      party hereto contained herein to be untrue or inaccurate in any respect on
      the date hereof or on the Effective Date;

	 	 	 
	 	(b) 	
      result in the failure to comply with or satisfy any
      covenant or agreement to be complied with or satisfied by such party
      hereto prior to the Effective Date; or

	 	 	 
	 	(c) 	
      result in the failure to satisfy any of the conditions
      precedent in favour of the other parties hereto favour contained in
      Section 5.01, Section 5.02 or Section 5.03 hereof, as the case may
    be.

Subject as herein provided, a party hereto may elect not to
complete the transactions contemplated hereby pursuant to the conditions
contained in Section 5.01, Section 5.02 or Section 5.03 hereof or exercise any
termination right arising therefrom; provided, however, that (i) promptly and in
any event prior to the filing of the Arrangement Filings with the Registrar, the
party hereto intending to rely thereon has delivered a written notice to the
other parties hereto specifying in reasonable detail the breaches of covenants
or untruthfulness or inaccuracy of representations and warranties or other
matters which the party hereto delivering such notice is asserting as the basis
for the exercise of the termination right, as the case may be, and (ii) if any
such notice is delivered, and a party hereto is proceeding diligently, at its
own expense, to cure such matter, if such matter is susceptible to being cured,
the party hereto which has delivered such notice may not terminate this
Agreement until the earlier of the Completion Deadline and the expiration of a
period of 15 days from date of delivery of such notice. If such notice has been
delivered prior to the date of the Trans-Orient Meeting, the Trans-Orient
Meeting shall be adjourned or postponed until the expiry of such period.

	Section 5.05 	Merger of Conditions

The conditions set out in Section 5.01, Section 5.02 or Section
5.03 hereof shall be conclusively deemed to have been satisfied, fulfilled or
waived upon the issue of the Certificate. Trans-Orient acknowledges and agrees
that it shall have no right to file the Arrangement Filings with the Registrar
unless such conditions have been satisfied, fulfilled or waived.

- 46 -

ARTICLE SIX
 NON-SOLICITATION AND BREAK-UP FEE

	Section 6.01 	Mutual Covenants Regarding
      Non-Solicitation 

	 	(a) 	
      Until the later of the Completion Deadline and the date
      on which any amount required to be paid by TAG or Trans-Orient, as the
      case may be, (in this section the “Involved Party”) in accordance with the
      provisions of this Agreement has actually been received by the other of
      them (in this section the “Non-Involved Party”), the Involved Party shall
      not, directly or indirectly, through any officer, director, employee,
      representative or agent of the Involved Party or any of the Subsidiaries
      of the Involved Party, or otherwise:

	 	 	 	 
	 		(i) 	
      solicit or initiate (including by way of furnishing
      information or entering into any form of agreement, arrangement or
      understanding) any inquiries or proposals regarding any Acquisition
      Proposal in respect of the Involved Party or potential Acquisition
      Proposal in respect of the Involved Party;

	 	 	 	 
	 		(ii) 	
      participate, directly or indirectly, in any discussions
      or negotiations regarding any Acquisition Proposal in respect of the
      Involved Party or potential Acquisition Proposal in respect of the
      Involved Party;

	 	 	 	 
	 		(iii) 	
      withdraw, modify or qualify in a manner adverse to the
      Non-Involved Party the approval of the directors of the Involved Party of
      the transactions contemplated hereby;

	 	 	 	 
	 		(iv) 	
      agree to, approve or recommend, or propose publicly to
      approve or recommend, any Acquisition Proposal in respect of the Involved
      Party or potential Acquisition Proposal in respect of the Involved Party;
      or

	 	 	 	 
	 		(v) 	
      enter into any agreement related to any Acquisition
      Proposal in respect of the Involved Party or potential Acquisition
      Proposal in respect of the Involved Party;

	 	 	 	 
	 			
      provided, however, that, notwithstanding the preceding
      part of this Section 6.01(a) and any other provision of this Agreement,
      nothing shall prevent or restrict the directors of the Involved Party from
      considering or negotiating any unsolicited bona fide Acquisition
      Proposal in respect of the Involved Party that may or may not be a
      Superior Proposal or from considering, negotiating, approving,
      recommending to the shareholders thereof or entering into an agreement in
      respect of a Superior Proposal from any person.

	 	 	 	 
	 	(b) 	
      Within 48 hours of the receipt by any director or officer
      of a Involved Party of any Acquisition Proposal in respect of the Involved
      Party, or any amendment to the foregoing, or any request for non-public
      information relating to the Involved Party or any of the Subsidiaries of
      the Involved Party in connection with any Acquisition Proposal in respect
      of the Involved Party or for access to the properties, books or records of
      the Involved Party or any of the Subsidiaries of the Involved Party by any
      person that informs the Involved Party or any of the Subsidiaries of the
      Involved Party that it is considering making, or has made, an Acquisition
      Proposal in respect of the Involved Party, the Involved Party shall notify
      the Non-Involved Party thereof, at first orally and then, as soon as
      possible thereafter, in writing. Such written notice shall include a copy
      of the Acquisition Proposal documents (with such deletions as are
      necessary to protect any confidential portions of such documents, provided
      that material terms and conditions

- 47 -

	 		
      of, and the identity of the person making, such
      Acquisition Proposal may not be deleted) if the same has been received as
      described above, or, if not so received, a description of the material
      terms and conditions of the Acquisition Proposal and, in any event,
      provide such details of the Acquisition Proposal, inquiry or contact as
      the Non-Involved Party may reasonably request, including the identity of
      the person making such Acquisition Proposal, inquiry or contact.

	 	 	 
	 	(c) 	
      If the Involved Party receives a request for material
      non-public information from a person who proposes a bona fide
      Acquisition Proposal in respect of the Involved Party (the existence
      and content of which have been disclosed to the Non-Involved Party), and
      the directors of the Involved Party determine that such proposal would be
      a Superior Proposal pursuant to Section 6.01(a) hereof having received the
      advice referred to in the definition of Superior Proposal, then, and only
      in such case, the directors of the Involved Party may, subject to the
      execution of a confidentiality agreement substantially similar to the
      Confidentiality Agreement, provide such person with access to information
      regarding the Involved Party; provided, however, that the person making
      the Acquisition Proposal in respect of the Involved Party shall not be
      precluded thereunder from making the Acquisition Proposal, and provided
      further that the Involved Party sends a copy of any such confidentiality
      agreement to the Non-Involved Party immediately upon the execution thereof
      and the Non-Involved Party is provided with a list of or a copy of the
      information, if any, provided to such person that was not previously
      provided to the Non- Involved Party and the Non-Involved Party is
      immediately provided with access to similar information.

	 	 	 
	 	(d) 	
      The Involved Party shall ensure that the officers,
      directors and employees thereof and any financial advisors or other
      advisors or representatives retained by the Involved Party are aware of
      the provisions of this Section 6.01 and the Involved Party shall be
      responsible for any breach of this Section 6.01 by its financial advisors
      or other advisors or representatives.

	Section 6.02 	Notice by the Involved Party of Superior
      Proposal Determination; Right to Match 

	 	(a) 	
      Until the later of the Completion Deadline and the date
      on which any amount required to be paid by the Involved Party in
      accordance with the provisions of this Agreement has actually been
      received by the Non-Involved Party, the Involved Party and the directors
      thereof shall not accept, approve, recommend or enter into any agreement
      in respect of an Acquisition Proposal in respect of the Involved Party
      (other than a confidentiality agreement contemplated by Section 6.01(c)
      hereof) on the basis that it would constitute a Superior Proposal, unless
      (i) it has provided the Non-Involved Party with a copy of the documents
      containing such Acquisition Proposal (with such deletions as are necessary
      to protect any confidential portions of such document, provided that
      material terms or conditions of, and the identity of the person making,
      such Acquisition Proposal may not be deleted) which the directors of the
      Involved Party have determined would be a Superior Proposal pursuant to
      subsection Section 6.01(a), and (ii) five Business Days shall have elapsed
      from the later of the date the Non-Involved Party received written notice
      of the determination of the directors of the Involved Party to, subject to
      the Non- Involved Party’s rights under Section 6.02(b) accept, approve,
      recommend, or enter into an agreement in respect of, such Acquisition
      Proposal and the date the Non-Involved Party received a copy of the
      Acquisition Proposal.

	 	 	 
	 	(b) 	
      During the five Business Days referred to in Section
      6.02(a) hereof, the Involved Party acknowledges and agrees that the
      Non-Involved Party shall have the opportunity, but
not

- 48 -

	 	the obligation, to offer to amend the terms of this Agreement
      and the Arrangement. The directors of the Involved Party shall review any offer
      by the Non-Involved Party to amend the terms of this Agreement and the
      Arrangement in order to determine in good faith, as of the later of the dates
      referred to in paragraph 6.02(a)(ii) hereof, whether the offer of the
      Non-Involved Party upon acceptance by the Involved Party would at least match
      the value per common share of the Involved Party of the Superior Proposal. If
      the directors of the Involved Party so determine, the Involved Party shall enter
      into an amended agreement with the Non-Involved Party reflecting the amended
      proposal of the Non-Involved Party. If the directors of the Involved Party do
      not so determine and instead determine, in good faith and after consultation
      with, and receiving advice (which may include written opinions, a copy of which
      shall have been provided to the Non-Involved Party) from, as appropriate,
      financial, legal and other advisors to the Involved Party, that the Acquisition
      Proposal is nonetheless a Superior Proposal and therefore reject the amended
      proposal of the Non-Involved Party, the Involved Party shall be liable to pay to
      the Non-Involved Party the fee contemplated by Section 6.03 hereof. The Involved
      Party also acknowledges and agrees that each successive modification of any
      Acquisition Proposal in respect of the Involved Party shall constitute a new
      Acquisition Proposal for purposes of the requirement under paragraph 6.02(a)(ii)
    hereof and shall initiate an additional five Business Day period.

	 	 
	Section 6.03 	Break Fee Event 

	 	(a) 	
      In the event that:

	 	 	 	 
	 		(i) 	
      this Agreement is terminated by TAG and TAG Subco
      pursuant to Section 7.02(c) hereof;

	 	 	 	 
	 		(ii) 	
      this Agreement is terminated by Trans-Orient pursuant to
      Section 7.02(f) hereof;

	 	 	 	 
	 		(iii) 	
      this Agreement is terminated by TAG and TAG Subco
      pursuant to Section 7.02(b) hereof through the intentional breach of
      Section 4.01(b)(iii) by Trans- Orient by failing to submit the Arrangement
      for approval to the Trans-Orient Shareholders on or prior to the date
      which is five Business Days prior to the Completion Deadline or failing to
      solicit proxies; or

	 	 	 	 
	 		(iv) 	
      an Acquisition Proposal shall have been made to
      Trans-Orient and made known to Trans-Orient Shareholders generally or
      shall have been made directly to Trans-Orient Shareholders generally or
      any person shall have publicly announced an intention to make an
      Acquisition Proposal in respect of Trans-Orient and such Acquisition
      Proposal or announced intention shall not have been publicly withdrawn
      prior to the Trans-Orient Meeting, thereafter, there is a failure to
      obtain the approval of the Arrangement by Trans-Orient Shareholders at the
      Trans-Orient Meeting, and this Agreement is terminated by either TAG and
      TAG Subco or Trans-Orient pursuant to Section 7.02(e) hereof and such
      Acquisition Proposal is completed within 12 months of the Trans-Orient
      Meeting;

then Trans-Orient shall pay to TAG within five Business Days
following such event $100,000 in immediately available funds to an account
designated by TAG. Trans-Orient shall not be obligated to make more than one
payment pursuant to this Section 6.03(a) . Trans-Orient hereby acknowledges that
the payment amount set out in this section is a payment of liquidated damages
which are a genuine pre-estimate of the damages which TAG will suffer or incur
as a result of the event giving rise to such damages and the resultant
non-completion of the Arrangement and are not penalties. Trans-Orient hereby

- 49 -

irrevocably waives any right it may have to raise as a defence
that any such liquidated damages are excessive or punitive.

	 	(b) 	
      In the event that:

	 	 	 	 
	 		(i) 	
      this Agreement is terminated by Trans-Orient pursuant to
      Section 7.02(d) hereof; or

	 	 	 	 
	 		(ii) 	
      this Agreement is terminated by TAG and TAG Subco
      pursuant to Section 7.02(g) hereof;

then TAG shall pay to Trans-Orient within five Business Days
following such event $100,000 in immediately available funds to an account
designated by Trans-Orient. TAG shall not be obligated to make more than one
payment pursuant to this Section 6.03(b) . TAG hereby acknowledges that the
payment amount set out in this section is a payment of liquidated damages which
are a genuine pre-estimate of the damages which Trans-Orient will suffer or
incur as a result of the event giving rise to such damages and the resultant
non-completion of the Arrangement and are not penalties. TAG hereby irrevocably
waives any right it may have to raise as a defence that any such liquidated
damages are excessive or punitive.

ARTICLE SEVEN 
AMENDMENT AND TERMINATION

	Section 7.01 	Amendment 

This Agreement may, at any time and from time to time before or
after the holding of the Trans-Orient Meeting, be amended by mutual written
agreement of the parties hereto without, subject to applicable Law, further
notice to or authorization on the part of the Trans-Orient Shareholders, and any
such amendment may, without limitation:

	 	(a) 	
      change the time for the performance of any of the
      obligations or acts of any of the parties hereto;

	 	 	 
	 	(b) 	
      waive any inaccuracies in or modify any representation or
      warranty contained herein or in any document delivered pursuant
    hereto;

	 	 	 
	 	(c) 	
      waive compliance with or modify any of the covenants
      herein contained and waive or modify the performance of any of the
      obligations of any of the parties hereto; and

	 	 	 
	 	(d) 	
      waive compliance with or modify any condition herein
      contained;

provided, however, that notwithstanding the foregoing, after
receipt of the approval of Trans-Orient Shareholders, other than as may be
ordered by the Court, there shall be no amendment that by law requires further
approval of the Trans-Orient Shareholders without the further approval of such
holders. This Agreement and the Plan of Arrangement may be amended in accordance
with the Final Order, but in the event that the terms of the Final Order require
any such amendment, the rights of the parties hereto under Section 5.01, Section
5.02, Section 5.03, Section 6.03 and Article Seven hereof shall remain
unaffected.

	Section 7.02 	Termination 

This Agreement may be terminated at any time prior to the
Effective Date:

- 50 -

	 	(a) 	
      by the mutual written consent of the parties
    hereto;

	 	 	 
	 	(b) 	
      as provided in Section 5.01, Section 5.02 and Section
      5.03, hereof;

	 	 	 
	 	(c) 	
      by TAG and TAG Subco if the directors of Trans-Orient
      shall have withdrawn or modified in a manner adverse to TAG and TAG Subco
      their approval or recommendation of the Arrangement or shall have approved
      or recommended any Superior Proposal;

	 	 	 
	 	(d) 	
      by Trans-Orient if the directors of TAG shall have
      withdrawn or modified in a manner adverse to Trans-Orient their approval
      of the Arrangement or shall have approved or recommended any Superior
      Proposal;

	 	 	 
	 	(e) 	
      by TAG and TAG Subco or by Trans-Orient if the
      Trans-Orient Meeting shall have been held and completed and the approval
      of the Arrangement by Trans-Orient Shareholders required by Section
      5.01(b) hereof shall not have occurred;

	 	 	 
	 	(f) 	
      by Trans-Orient upon any determination by Trans-Orient,
      after the conclusion of the process set out in Section 6.01 and Section
      6.02, that an Acquisition Proposal in respect of Trans-Orient constitutes
      a Superior Proposal;

	 	 	 
	 	(g) 	
      by TAG and TAG Subco upon any determination by TAG, after
      the conclusion of the process set out in Section 6.01 and Section 6.02,
      hereof, that an Acquisition Proposal in respect of TAG constitutes a
      Superior Proposal;

	 	 	 
	 	(h) 	
      by either TAG and TAG Subco or Trans-Orient, if the
      Effective Time shall not have occurred on or before the Completion
      Deadline provided that the right to terminate this Agreement under this
      Section 7.02(h) shall not be available to any party whose failure to
      fulfill any obligation under this Agreement has been the cause of, or
      resulted in, the failure of the Effective Time to occur on or before the
      Completion Deadline; or

	 	 	 
	 	(i) 	
      by Trans-Orient if the Cheal Acquisition is not completed
      by November 30, 2009.

provided that any termination by a party hereto in accordance
with paragraph (b), (c), (d), (e), (f) (g) or (h) above shall be made by such
party delivering written notice thereof to the other party or parties hereto
prior to the Effective Date and, in each case other than paragraph (h),
specifying therein in reasonable detail the matter or matters giving rise to
such termination right. In the event of any such termination, subject to the
obligations of Trans-Orient and TAG contained in Article Six hereof, including
the payment required by Section 6.03 hereof, each party hereto shall be deemed
to have released, remised and forever discharged the other parties hereto in
respect of any and all claims arising in respect of this Agreement, except as
otherwise provided herein and provided that, subject to Section 6.03 hereof,
neither the termination of this Agreement nor anything contained in this Section
7.02 shall relieve any party hereto from any liability for any wilful breach by
it of this Agreement (other than a breach of a representation or warranty except
in such case to the extent Section 8.02 hereof applies).

ARTICLE EIGHT 
GENERAL

	Section 8.01 	Notices 

Any notice, consent, waiver, direction or other communication
required or permitted to be given under this Agreement by a party hereto shall
be in writing and shall be delivered by hand to the party hereto to which the
notice is to be given at the following address or sent by facsimile to the
following numbers or 

- 51 -

to such other address or facsimile number as shall be specified
by a party hereto by like notice. Any notice, consent, waiver, direction or
other communication aforesaid shall, if delivered, be deemed to have been given
and received on the date on which it was delivered to the address provided
herein (if a Business Day or, if not, then the next succeeding Business Day) and
if sent by facsimile be deemed to have been given and received at the time of
receipt (if a Business Day or, if not, then the next succeeding Business Day)
unless actually received after 4:00 p.m. (Vancouver time) at the point of
delivery in which case it shall be deemed to have been given and received on the
next Business Day.

The address for service of each of the parties hereto shall be
as follows:

	 	(a) 	if to Trans-Orient: 
	 	  	 
	 	  	           
             Trans-Orient Petroleum Ltd. 
	 	  	           
             999 Canada Place, Suite 404 
	 	  	           
             World Trade Center 
	 	 	                   Vancouver,
      BC V6C 3E2 
	 	  	 
	 	  	                   Attention:                    Chief
      Executive Officer 
	 	  	                   Facsimile:                 
         604-682-1174 
	 	  	 
	 	(b) 	if to TAG and/or TAG Subco: 
	 	  	 
	 	  	                   TAG
      Oil Ltd. 
	 	  	           
             1050 Burrard Street, Suite 2901 
	 	 	                   Vancouver,
      BC V6Z 2S3  
	 	  	 
	 	  	                   Attention:                    Chief
      Executive Officer 
	 	  	                   Facsimile:                    
      604-682-1174 

	Section 8.02 	Remedies 

The parties hereto acknowledge and agree that an award of money
damages may be inadequate for any breach of this Agreement by any party hereto
or its representatives and advisors and that such breach may cause the
non-breaching party hereto irreparable harm. Accordingly, the parties hereto
agree that, in the event of any such breach or threatened breach of this
Agreement by one of the parties hereto, Trans-Orient (if either TAG or TAG Subco
is the breaching party) or TAG and TAG Subco (if Trans-Orient is the breaching
party) will be entitled, without the requirement of posting a bond or other
security, to seek equitable relief, including injunctive relief and specific
performance. Subject to any other provision hereof including, without
limitation, Section 6.03 hereof, such remedies will not be the exclusive
remedies for any breach of this Agreement but will be in addition to all other
remedies available hereunder or at law or in equity to each of the parties
hereto.

	Section 8.03 	Expenses 

The parties hereto agree that all out-of-pocket expenses
incurred in connection with this Agreement and the transactions contemplated
hereby, the Trans-Orient Meeting and the preparation and mailing of the Proxy
Circular, including legal and accounting fees, printing costs, financial advisor
fees and all disbursements by advisors, shall be paid by the party hereto
incurring such expense. Each party hereto represents and warrants to the others
of them that no broker, finder or investment banker is entitled to any
brokerage, finder’s or other fee or commission, or to the reimbursement of any
of its expenses, in connection with the transactions contemplated hereby. The
provisions of this Section 8.03 shall survive the termination of this
Agreement.

- 52 -

	Section 8.04 	Time of the Essence 

Time shall be of the essence in this Agreement.

	Section 8.05 	Entire Agreement 

Except for the Confidentiality Agreement, this Agreement,
together with the agreements and other documents herein or therein referred to,
constitute the entire agreement between the parties hereto pertaining to the
subject matter hereof and supersede all prior agreements, understandings,
negotiations and discussions, whether oral or written, between the parties
hereto with respect to the subject matter hereof. There are no representations,
warranties, covenants or conditions with respect to the subject matter hereof
except as contained herein.

	Section 8.06 	Further Assurances 

Each party hereto shall, from time to time, and at all times
hereafter, at the request of the other of them, but without further
consideration, do, or cause to be done, all such other acts and execute and
deliver, or cause to be executed and delivered, all such further agreements,
transfers, assurances, instruments or documents as shall be reasonably required
in order to fully perform and carry out the terms and intent hereof including,
without limitation, the Plan of Arrangement.

	Section 8.07 	Governing Law 

This Agreement shall be governed by, and be construed in
accordance with, the laws of the Province of British Columbia and the laws of
Canada applicable therein but the reference to such laws shall not, by conflict
of laws rules or otherwise, require the application of the law of any
jurisdiction other than the Province of British Columbia. Each party hereto
hereby irrevocably attorns to the jurisdiction of the courts of the Province of
British Columbia in respect of all matters arising under or in relation to this
Agreement.

	Section 8.08 	Execution in Counterparts

This Agreement may be executed in one or more counterparts,
each of which shall conclusively be deemed to be an original and all such
counterparts collectively shall be conclusively deemed to be one and the
same.

	Section 8.09 	Waiver 

No waiver or release by any party hereto shall be effective
unless in writing and executed by the party granting such waiver or release and
any waiver or release shall affect only the matter, and the occurrence thereof,
specifically identified and shall not extend to any other matter or occurrence.
Waivers may only be granted upon compliance with the provisions governing
amendments set forth in Section 7.01 hereof.

	Section 8.10 	No Personal Liability

	 	(a) 	
      No director or officer of Trans-Orient shall have any
      personal liability whatsoever (other than in the case of fraud, negligence
      or wilful misconduct) to TAG under this Agreement or any other document
      delivered in connection with this Agreement or the Arrangement by or on
      behalf of Trans-Orient.

	 	 	 
	 	(b) 	
      No director or officer of TAG or TAG Subco shall have any
      personal liability whatsoever (other than in the case of fraud, negligence
      or wilful misconduct) to Trans-Orient under

- 53 -

this Agreement or any other document
delivered in connection with this Agreement or the Arrangement by or on behalf
of TAG or TAG Subco.

	Section 8.11 	Enurement and Assignment

This Agreement shall enure to the benefit of the parties hereto
and their respective successors and permitted assigns and shall be binding upon
the parties hereto and their respective successors. This Agreement may not be
assigned by any party hereto without the prior written consent of each of the
other parties hereto.

IN WITNESS WHEREOF the parties hereto have executed this
Agreement as of the date first above written.

	 	TAG OIL LTD.
  
	 	 
	 	Per: 
	 	 	/s/John Vaccaro 
	 	 	 
	 	 	  
	 	TAG ACQUISITION
      CORP. 
	 	 
	 	Per: 
	 	 	/s/Garth Johnson 
	 	 	 
	 	 	  
	 	TRANS-ORIENT
      PETROLEUM LTD. 
	 	 
	 	Per: 
	 	 	/s/Ronald Bertuzzi 

SCHEDULE A

PLAN OF ARRANGEMENT 
UNDER DIVISION 5 OF PART 9 OF
THE
BRITISH COLUMBIA BUSINESS CORPORATIONS ACT

ARTICLE 1 
DEFINITIONS AND INTERPRETATION

	1.01 	Definitions 

In this Plan of Arrangement, unless the context otherwise
requires, the following words and terms with the initial letter or letters
thereof capitalized shall have the meanings ascribed to them below:

	 	(a) 	
      “Amalgamating Corporations” means TAG Subco and
      Trans-Orient collectively and “Amalgamating Corporation” means either one
      of them;

	 	 	 
	 	(b) 	
      “Amalgamation” means the amalgamation of the Amalgamating
      Corporations as contemplated by this Plan of Arrangement;

	 	 	 
	 	(c) 	
      “Arrangement” means the arrangement under the provisions
      of Division 5 of Part 9 of the BCBCA on the terms and subject to the
      conditions set forth in this Plan of Arrangement, subject to any amendment
      or supplement hereto made in accordance with the provisions hereof or at
      the direction of the Court in the Final Order;

	 	 	 
	 	(d) 	
      “Arrangement Agreement” means the arrangement agreement
      dated as of September 14, 2009 between TAG, TAG Subco and Trans-Orient, as
      amended or supplemented prior to the Effective Date, entered into in
      connection with the Arrangement;

	 	 	 
	 	(e) 	
      “Arrangement Filings” means the filings in respect of the
      Arrangement required by the BCBCA to be filed with the Registrar after the
      Final Order is made;

	 	 	 
	 	(f) 	
      “Business Day” means any day other than a Saturday, a
      Sunday or a statutory holiday in Vancouver, British Columbia;

	 	 	 
	 	(g) 	
      “BCBCA” means the Business Corporations Act
      (British Columbia);

	 	 	 
	 	(h) 	
      “Certificate” means a certificate signed by a senior
      officer of each of TAG Subco and Trans-Orient formally giving effect to
      the Arrangement;

	 	 	 
	 	(i) 	
      “Common Shares” means the common shares in the capital of
      the Corporation having the rights, privileges, restrictions and conditions
      set forth in the Amalgamation Application attached hereto as Appendix A
      hereof;

	 	 	 
	 	(j) 	
      “Corporation” means the corporation resulting from the
      Amalgamation;

	 	 	 
	 	(k) 	
      “Court” means the British Columbia Supreme
  Court;

	 	 	 
	 	(l) 	
      “Depositary” means Computershare Investor Services Inc.,
      being the depositary appointed by TAG for the purpose of, among other
      things, exchanging certificates representing Trans-Orient Common Shares
      for TAG Common Shares;

A-2

	 	(m) 	
      “Dissent Procedures” means the procedures set forth in
      Division 2 of Part 8 of the BCBCA required to be taken by a registered
      holder of Trans-Orient Common Shares to validly dissent in connection with
      the Arrangement;

	 	 	 
	 	(n) 	
      “Dissenting Shareholders” means the registered holders of
      Trans-Orient Common Shares who dissent in respect of the Arrangement in
      strict compliance with the Dissent Procedures;

	 	 	 
	 	(o) 	
      “Effective Date” means the date set out in the
      Certificate as being the effective date in respect of the
    Arrangement;

	 	 	 
	 	(p) 	
      “Effective Time” means 12:01 a.m. (Vancouver time) on the
      Effective Date;

	 	 	 
	 	(q) 	
      “Final Order” means the order of the Court, including any
      amendment thereto, pursuant to subsection 288(2)(b) of the BCBCA approving
      the Arrangement or, if appealed, then unless such appeal is withdrawn or
      denied, as affirmed;

	 	 	 
	 	(r) 	
      “Former Trans-Orient Shareholders” means the holders of
      Trans-Orient Common Shares immediately prior to the Effective
  Time;

	 	 	 
	 	(s) 	
      “Interim Order” means the interim order of the Court,
      including any amendment thereto, pursuant to subsection 288(2)(b) of the
      BCBCA made in connection with the Arrangement;

	 	 	 
	 	(t) 	
      “Letter of Transmittal” means the letter of transmittal
      for use by the holders of Trans- Orient Common Shares in the form
      accompanying the Proxy Circular;

	 	 	 
	 	(u) 	
      “Meeting Date” means the date of the Trans-Orient
      Meeting;

	 	 	 
	 	(v) 	
      “Plan of Arrangement” means this plan of arrangement, as
      amended, modified or supplemented from time to time in accordance herewith
      and any order of the Court;

	 	 	 
	 	(w) 	
      “Proxy Circular” means the management information
      circular prepared by Trans-Orient for the Trans-Orient Meeting;

	 	 	 
	 	(x) 	
      “Registrar” means the Registrar appointed pursuant to
      section 400 of the BCBCA;

	 	 	 
	 	(y) 	
      “TAG” means TAG Oil Ltd., a corporation existing under
      the BCBCA;

	 	 	 
	 	(z) 	
      “TAG Common Shares” means common shares in the capital of
      TAG;

	 	 	 
	 	(aa) 	
      “TAG Subco” means TAG Acquisition Corp., a wholly-owned
      subsidiary of TAG existing under the BCBCA;

	 	 	 
	 	(bb) 	
      “Trans-Orient” means Trans-Orient Petroleum Ltd., a
      corporation existing under the BCBCA;

	 	 	 
	 	(cc) 	
      “Trans-Orient Common Shares” means the common shares in
      the capital of Trans-Orient;

	 	 	 
	 	(dd) 	
      “Trans-Orient Meeting” means the special meeting of the
      holders of Trans-Orient Common Shares held, among other things, to
      consider and approve the Arrangement;

A-3

	 	(ee) 	
      “Trans-Orient Options” means the outstanding options to
      purchase Trans-Orient Common Shares issued pursuant to the Trans-Orient
      Stock Option Plan;

	 	 	 
	 	(ff) 	
      “Trans-Orient Stock Option Plan” means the stock option
      plan of Trans-Orient in existence as of the date hereof;

	 	 	 
	 	(gg) 	
      “Trans-Orient Shareholders” means the holders of
      Trans-Orient Common Shares at the applicable time;

	 	 	 
	 	(hh) 	
      “Trans-Orient Subsidiaries” means DLJ Management Corp.,
      Eastern Petroleum (NZ) Limited, Orient Petroleum (NZ) Limited and Orient
      Petroleum (PNG) Limited;

	 	 	 
	 	(ii) 	
      “Trans-Orient Warrants” means the 200,000 warrants to
      acquire 200,000 common shares at a price of US$0.80 per share until expiry
      on June 24, 2010.

In addition, words and phrases used herein and defined in the
BCBCA shall have the same meaning herein as in the BCBCA unless the context
otherwise requires.

	1.02 	Interpretation Not Affected by Headings
    

The division of this Plan of Arrangement into articles,
sections, paragraphs and subparagraphs and the insertion of headings herein are
for convenience of reference only and shall not affect the construction or
interpretation of this Plan of Arrangement. The terms “this Plan of
Arrangement”, “hereof”, “herein”, “hereto”, “hereunder” and similar expressions
refer to this Plan of Arrangement and not to any particular article, section or
other portion hereof and include any instrument supplementary or ancillary
hereto.

	1.03 	Number, Gender and Persons

In this Plan of Arrangement, unless the context otherwise
requires, words importing the singular shall include the plural and vice versa,
words importing the use of either gender shall include both genders and neuter
and the word person and words importing persons shall include a natural person,
firm, trust, partnership, association, corporation, joint venture or government
(including any governmental agency, political subdivision or instrumentality
thereof) and any other entity of any kind or nature whatsoever.

	1.04 	Date for any Action 

If the date on which any action is required to be taken
hereunder is not a Business Day, such action shall be required to be taken on
the next succeeding day which is a Business Day.

	1.05 	Statutory References

Any reference in this Plan of Arrangement to a statute includes
all regulations made thereunder, all amendments to such statute or regulation in
force from time to time and any statute or regulation that supplements or
supersedes such statute or regulation.

ARTICLE 2 
ARRANGEMENT AGREEMENT

	2.01 	Arrangement Agreement

This Plan of Arrangement is made pursuant to, and is subject to
the provisions of, the Arrangement Agreement.

A-4

ARTICLE 3 
ARRANGEMENT

	3.01 	Arrangement 

At the Effective Time, the following shall occur without any
further act or formality:

		(a) 	
      the Amalgamating Corporations shall be amalgamated and
      continue as the Corporation on the terms prescribed in this Plan of
      Arrangement, and

	 	 	 	 
			(i) 	
      the property of each of the Amalgamating Corporations
      shall continue to be the property of the Corporation,

	 	 	 	 
			(ii) 	
      the Corporation shall continue to be liable for the
      obligations of each of the Amalgamating Corporations,

	 	 	 	 
			(iii) 	
      an existing cause of action, claim or liability to
      prosecution by or against an Amalgamating Corporation shall be
      unaffected,

	 	 	 	 
			(iv) 	
      a civil, criminal or administrative action or proceeding
      pending by or against an Amalgamating Corporation may continue to be
      prosecuted by or against the Corporation,

	 	 	 	 
			(v) 	
      a conviction against, or ruling, order or judgment in
      favour of or against an Amalgamating Corporation may be enforced by or
      against the Corporation,

	 	 	 	 
			(vi) 	
      the Corporation will have as its notice of articles, the
      notice of articles contained in the Amalgamation Application attached
      hereto as Appendix A, and

	 	 	 	 
			(vii) 	
      the Corporation will have as its articles the articles of
      TAG Subco;

	 	 	 	 
		(b) 	
      all Trans-Orient Common Shares held by TAG or TAG Subco
      shall be cancelled without any repayment of capital in respect
    thereof;

	 	 	 	 
		(c) 	
      all Trans-Orient Common Shares held by Former
      Trans-Orient Shareholders (other than Dissenting Shareholders) shall be
      exchanged for TAG Common Shares on the basis of 2.8 Trans-Orient Common
      Shares for each one TAG Common Share, subject to 3.03 and 4.01
    hereof;

	 	 	 	 
		(d) 	
      each common share of TAG Subco shall be exchanged for one
      Common Share;

	 	 	 	 
		(e) 	
      the Corporation shall issue one Common Share to TAG for
      each TAG Common Share issued by TAG pursuant to Section 3.01(c);
  and

	 	 	 	 
		(f) 	
      all of the Trans-Orient Options and Trans-Orient Warrants
      shall be exercisable for TAG Common Shares following the Effective Time in
      accordance with their terms.

	 	 	 	 
	3.02 	
      Post-Effective Time Procedures

	 	 	 	 
		(a) 	
      On or promptly after the Effective Date, TAG shall
      deliver or arrange to be delivered to the Depositary certificates
      representing the TAG Common Shares required to be issued to Former
      Trans-Orient Shareholders in accordance with the provisions of 3.01
      hereof,

A-5

	 		
      which certificates shall be held by the Depositary as
      agent and nominee for such Former Trans-Orient Shareholders for
      distribution to such Former Trans-Orient Shareholders in accordance with
      the provisions of Article 5 hereof.

	 	 	 
	 	(b) 	
      Subject to the provisions of Article 5 hereof, former
      Trans-Orient Shareholders shall be entitled to receive delivery of the
      certificates representing the TAG Common Shares to which they are entitled
      pursuant to 3.01(c) hereof.

	3.03 	No Fractional TAG Common Shares
  

Notwithstanding 3.01(c) hereof, no fractional TAG Common Shares
shall be issued to Former Trans-Orient Shareholders and any fractional number of
TAG Common Shares shall be rounded down to the next whole number of TAG Common
Shares without any reimbursement or payment associated therewith.

ARTICLE 4 
RIGHTS OF DISSENT

	4.01 	Rights of Dissent 

Holders of Trans-Orient Common Shares may exercise the Dissent
Procedures with respect to Trans-Orient Common Shares, in connection with the
Arrangement provided that holders who exercise such rights of dissent and
who:

	 	(a) 	
      are ultimately entitled to be paid fair value for their
      Trans-Orient Common Shares, which fair value, notwithstanding anything to
      the contrary contained in the BCBCA, shall be determined as of the
      Effective Time, shall be deemed to have transferred such Trans- Orient
      Common Shares, to Trans-Orient for cancellation at the Effective Time;
      or

	 	 	 
	 	(b) 	
      are ultimately not entitled, for any reason, to be paid
      fair value for their Trans-Orient Common Shares, shall be deemed to have
      participated in the Arrangement on the basis set forth in 3.01(c)
      hereof;

but further provided that in no case shall TAG, TAG Subco,
Trans-Orient or any other person be required to recognize Dissenting
Shareholders as holders of Trans-Orient Common Shares after the Effective Time,
and the names of such Dissenting Shareholders shall be deleted from the register
of holders of Trans-Orient Common Shares at the Effective Time.

ARTICLE 5
DELIVERY OF TAG COMMON SHARES

	5.01 	
      Delivery of TAG Common Shares

	 	 	 
		(a) 	
      Upon surrender to the Depositary for cancellation of a
      certificate which immediately prior to the Effective Time represented one
      or more outstanding Trans-Orient Common Shares which were exchanged for
      TAG Common Shares in accordance with 3.01 hereof, together with a duly
      completed Letter of Transmittal and such other documents and instruments
      as would have been required to effect the transfer of the Trans-Orient
      Common Shares formerly represented by such certificate under the BCBCA and
      such additional documents and instruments as the Depositary may reasonably
      require, the holder of such surrendered certificate shall be entitled to
      receive in exchange therefor, and the Depositary shall deliver to such
      holder following the Effective Time, a
certificate

A-6

	 		
      representing the TAG Common Shares which such holder is
      entitled to receive in accordance with 3.02 hereof.

	 	 	 
	 	(b) 	
      After the Effective Time and until surrendered for
      cancellation as contemplated by 5.01(a) hereof, each certificate which
      immediately prior to the Effective Time represented one or more
      Trans-Orient Common Shares shall be deemed at all times to represent only
      the right to receive in exchange therefor a certificate representing the
      TAG Common Shares which the holder of such certificate is entitled to
      receive in accordance with 3.02 hereof.

	5.02 	Lost Certificates 

In the event that any certificate which immediately prior to
the Effective Time represented one or more outstanding Trans-Orient Common
Shares which were exchanged for TAG Common Shares in accordance with 3.01 hereof
shall have been lost, stolen or destroyed, upon the making of an affidavit of
that fact by the holder claiming such certificate to be lost, stolen or
destroyed, the Depositary shall deliver in exchange for such lost, stolen or
destroyed certificate, a certificate representing the TAG Common Shares which
such holder is entitled to receive in accordance with 3.02 hereof. When
authorizing such delivery of a certificate representing the TAG Common Shares
which such holder is entitled to receive in exchange for such lost, stolen or
destroyed certificate, the holder to whom a certificate representing such TAG
Common Shares is to be delivered shall, as a condition precedent to the delivery
of such TAG Common Shares, give a bond satisfactory to TAG and the Depositary in
such amount as TAG and the Depositary may direct, or otherwise indemnify TAG,
TAG Subco and the Depositary in a manner satisfactory to TAG and the Depositary,
against any claim that may be made against TAG, TAG Subco or the Depositary with
respect to the certificate alleged to have been lost, stolen or destroyed and
shall otherwise take such actions as may be required by the by-laws of the
Corporation.

	5.03 	Distributions with Respect to Unsurrendered
      Certificates 

No dividend or other distribution declared or made after the
Effective Time with respect to TAG Common Shares with a record date after the
Effective Time shall be delivered to the holder of any unsurrendered certificate
which, immediately prior to the Effective Time, represented outstanding
Trans-Orient Common Shares unless and until the holder of such certificate shall
have complied with the provisions of 5.01 or 5.02 hereof. Subject to applicable
law and to 5.05 hereof, at the time of such compliance, there shall, in addition
to the delivery of a certificate representing the TAG Common Shares to which
such holder is thereby entitled, be delivered to such holder, without interest,
the amount of the dividend or other distribution with a record date after the
Effective Time theretofore paid with respect such TAG Common Shares. 

	5.04 	Withholding Rights 

TAG, TAG Subco and the Depositary shall be entitled to deduct
and withhold from all dividends or other distributions otherwise payable to any
Former Trans-Orient Shareholder such amounts as TAG, TAG Subco or the Depositary
is required or permitted to deduct and withhold with respect to such payment
under the Income Tax Act (Canada), the United States Internal Revenue Code of
1986 or any provision of any applicable federal, provincial, state, local or
foreign tax law, in each case, as amended. To the extent that amounts are so
withheld, such withheld amounts shall be treated for all purposes hereof as
having been paid to the Former Trans-Orient Shareholder in respect of which such
deduction and withholding was made, provided that such withheld amounts are
actually remitted to the appropriate taxing authority.

A-7

	5.05 	Limitation and Proscription
  

To the extent that a Former Trans-Orient Shareholder shall not
have complied with the provisions of 5.01 or 5.02 hereof on or before the date
which is six years after the Effective Date (the “final proscription date”),
then the TAG Common Shares which such Former Trans-Orient Shareholder was
entitled to receive shall be delivered to TAG by the Depositary for cancellation
and shall be cancelled by TAG, and the interest of the Former Trans-Orient
Shareholder in such TAG Common Shares shall be terminated as of such final
proscription date.

ARTICLE 6
BINDING EFFECT, AMENDMENTS AND
PARAMOUNTCY

	6.01 	Binding Effect 

At and after the Effective Time, this Plan of Arrangement shall
be binding upon TAG, TAG Subco, Trans-Orient, all holders of Trans-Orient Common
Shares.

	6.02 	
      Amendments to Plan of Arrangement

	 	 	 
		(a) 	
      TAG and Trans-Orient reserve the right to amend, modify
      and/or supplement this Plan of Arrangement at any time and from time to
      time, provided that each such amendment, modification and/or supplement
      must be (i) set out in writing, (ii) agreed to in writing by TAG and
      Trans-Orient, (iii) filed with the Court and, if made following the
      Trans-Orient Meeting, approved by the Court (if so required), and (iv)
      communicated to Former Trans- Orient Shareholders if and as required by
      the Court.

	 	 	 
		(b) 	
      Any amendment, modification or supplement to this Plan of
      Arrangement may be proposed by either TAG or Trans-Orient at any time
      prior to the Trans-Orient Meeting provided that the other of them shall
      have consented thereto in writing, with or without any other prior notice
      or communication, and, if so proposed and accepted by the persons voting
      at the Trans-Orient Meeting (other than as may be required under the
      Interim Order), shall become part of this Plan of Arrangement for all
      purposes.

	 	 	 
		(c) 	
      Any amendment, modification or supplement to this Plan of
      Arrangement that is approved by the Court following the Trans-Orient
      Meeting shall be effective only if (i) it is consented to in writing by
      each of TAG and Trans-Orient, and (ii) if required by the Court, it is
      consented to by holders of the Trans-Orient Common Shares voting in the
      manner directed by the Court.

	6.03 	Paramountcy 

From and after the Effective Time (i) this Plan of Arrangement
shall take precedence and priority over any and all Trans-Orient Common Shares
issued prior to the Effective Time, (ii) the rights and obligations of the
Former Trans-Orient Shareholders, any trustee or transfer agent therefor and
each of TAG and Trans-Orient shall be solely as provided for in this Plan of
Arrangement, and (iii) all actions, causes of action, claims or proceedings
(actual or contingent, and whether or not previously asserted) based on or in
any way relating to the Trans-Orient Common Shares shall be deemed to have been
settled, compromised, released and determined without liability except as set
forth herein.

APPENDIX A 

AMALGAMATION APPLICATION

[To be inserted]

SCHEDULE B

FORM OF LOCK-UP AGREEMENT

LOCK-UP AGREEMENT

This Lock-Up Agreement is dated as of
o, 2009, 

BETWEEN:

TAG OIL LTD., a company
incorporated under the 
Business Corporations Act (British Columbia)

(hereinafter called “TAG”) 

- and -

The persons listed on Annex A hereto,
each of whom is a
 shareholder (a “Shareholder”) of Trans-Orient

Petroleum Ltd., a company incorporated under the 
Business
Corporations Act (British Columbia)

(hereinafter called the
“Company”)

RECITALS

		
      A. 
	
      TAG, TAG Acquisition Corp., a British Columbia
      corporation and wholly-owned subsidiary of TAG (“Sub”) and the
      Company are entering into an Arrangement Agreement dated as of the date
      hereof (the “Arrangement Agreement”), pursuant to which the Company
      and Sub will amalgamate by way of plan of arrangement (the
      “Arrangement”) and the existing shareholders of the Company will
      receive common shares of TAG in exchange for their common shares of the
      Company (“Company Shares”).

	 	 	 
		
      B. 
	The execution and delivery of this Agreement is a
      condition precedent to TAG and Sub entering into the Arrangement
    Agreement.
	 	 	 
		
      C. 
	Capitalized terms used but not otherwise defined herein
      have the meanings ascribed to them in the Arrangement Agreement.
	 	 	 
		
      Therefore, the parties hereby agree as follows:

	 	 	 
	1. 	
      Voting; Proxy

	 	 	 
		
      During the term of this Agreement:

	 	 	 
		(a) 	
      at any meeting (a “Meeting”) of the Company’s
      shareholders convened, and at any adjournment or postponement thereof, to
      consider and vote upon the approval of the Arrangement Agreement and the
      Arrangement, the Shareholder agrees to vote all Company Shares that the
      Shareholder beneficially owns or hereinafter acquires
  beneficial

B - 2

			
      ownership of (the “Securities”) which the
      Shareholder is entitled to vote (i) in favor of the approval and adoption
      of the Arrangement Agreement and the Arrangement; (ii) against approval of
      any proposal made in opposition to or in competition with the consummation
      of the Arrangement and the Arrangement Agreement; and (iii) against any
      other proposal or action that would, or would reasonably be expected to,
      prohibit or discourage the Arrangement;

	 	 	 	 
		(b) 	
      upon the request or direction of TAG, the Shareholder
      shall, no later than five Business Days prior to any Meeting, execute and
      deliver (or cause to be executed and delivered) a proxy or a voting
      instruction form, as applicable, in connection with such Meeting
    that:

	 	 	 	 
			(i) 	
      appoints such person designated by TAG to attend and act
      on behalf of the Shareholder at such Meeting; and (ii) instructs such
      Securities be voted at such Meeting in accordance with Section
    1(a)(i);

	 	 	 	 
		(c) 	
      the Shareholder shall not, without prior written consent
      of TAG, revoke any proxies or voting instruction forms executed and
      delivered pursuant to this Agreement;

	 	 	 	 
		(d) 	
      the Shareholder shall not, without the prior written
      consent of TAG, requisition or join in the requisition of any meeting of
      the Company’s shareholders for the purpose of considering any resolution
      with respect to any of the matters referred to in Section 1(a)(i);
    and

	 	 	 	 
		(e) 	
      the Shareholder shall not do anything to frustrate or
      hinder the consummation of the Arrangement.

	 	 	 	 
	2. 	
      No Solicitation; No Transfer

	 	 	 	 
		(a) 	
      Until the earlier of the Effective Time and the
      termination of this Agreement pursuant to its terms, the Shareholder will
      not and will not authorize or permit any of the Shareholder’s
      representatives to, and will instruct each such representative not to,
      directly or indirectly, take any actions prohibited by Section 6.01 of the
      Arrangement Agreement, as if such Shareholder were a party
  thereto.

	 	 	 	 
		(b) 	
      During the term of this Agreement, the Shareholder shall
      not sell, pledge, assign, or otherwise transfer, or authorize, propose, or
      agree to the sale, pledge, assignment, or other transfer of, any of such
      Shareholder’s Securities, unless (i) at least two business days’ written
      notice of the proposed transfer is provided to TAG, and (ii) the intended
      transferee agrees in writing to be bound by this Agreement as if such
      person were such Shareholder.

	 	 	 	 
	3. 	
      Representations and Warranties

	 	 	 	 
		(a) 	
      The Shareholder represents and warrants to TAG as
      follows:

	 	 	 	 
			(i) 	
      Authority. The Shareholder has the requisite power
      and authority to enter into this Agreement, to perform the Shareholder’s
      obligations hereunder, and to consummate the transactions contemplated
      hereby. No other proceedings or actions on the part of the Shareholder are
      necessary to authorize the execution, delivery, or performance of this
      Agreement or the consummation of the transactions contemplated hereby.
      This Agreement has been duly executed and delivered by the Shareholder and
      constitutes a valid and binding obligation, enforceable against the
      Shareholder in accordance with its terms.

B - 3

	 		(ii) 	
      Title; Authority to Vote Securities. The
      Shareholder is the sole owner of record and has sole voting power over the
      number of Securities set forth opposite the Shareholder’s name on Annex A,
      and such shares are held by the Shareholder free and clear of all
      Encumbrances that would limit or otherwise affect the Shareholder’s voting
      rights with respect to the Securities set forth on Annex A or otherwise
      prevent the Shareholder from performing the Shareholder’s obligations
      hereunder.

	 	 	 	 
	 		(iii) 	
      Noncontravention. None of the Shareholder’s
      execution and delivery of this Agreement, the Shareholder’s consummation
      of any of the transactions contemplated hereby, or the Shareholder’s
      compliance with any of the provisions hereof, will violate, conflict with,
      or result in a breach of, or constitute a default (or an event that, with
      notice or lapse of time or both, would constitute a default) under, or
      result in the creation of any Encumbrance upon any of the Shareholder’s
      Securities under, any agreement or instrument to which the Shareholder is
      a party or any statute, rule, regulation, judgment, order, decree, or
      other legal requirement applicable to the Shareholder.

	 	 	 	 
	 		(iv) 	
      Litigation. (i) There is no claim, action,
      proceeding, or investigation pending or, to the Shareholder’s knowledge,
      threatened against or relating to the Shareholder before any Governmental
      Entity, and (ii) the Shareholder is not subject to any outstanding order,
      writ, injunction, or decree, that, in the case of clause (i) or (ii), if
      determined adversely, would limit or otherwise affect the Shareholder’s
      voting rights with respect to the Company Shares set forth on Annex A or
      otherwise prohibit the Shareholder from performing the Shareholder’s
      obligations hereunder.

	 	 	 	 
	 		(v) 	
      Reliance. The Shareholder understands and
      acknowledges that TAG is entering into the Arrangement Agreement in
      reliance upon such Shareholder’s execution, delivery, and performance of
      this Agreement. The Shareholder acknowledges that its irrevocable proxy is
      to be granted in consideration of the execution and delivery of the
      Arrangement Agreement by TAG.

	 	 	 	 
	 	(b) 	
      TAG represents and warrants to the Shareholder as
      follows:

	 	 	 	 
	 		(i) 	
      TAG has duly executed and delivered the Arrangement
      Agreement and this Agreement;

	 	 	 	 
	 		(ii) 	
      the execution, delivery and performance by TAG of the
      Arrangement Agreement and this Agreement and the consummation by TAG of
      the transactions contemplated thereby and hereby are within the corporate
      powers of TAG and have been duly authorized by all necessary corporate
      action; and

	 	 	 	 
	 		(iii) 	
      each of the Arrangement Agreement and this Agreement
      constitutes a valid and binding agreement of TAG, enforceable against TAG
      in accordance with its terms, except to the extent enforceability may be
      subject to (A) bankruptcy, insolvency, fraudulent conveyance,
      reorganization, moratorium and other similar Laws affecting or relating to
      creditors’ rights generally and (B) general equitable principles (whether
      considered in a proceeding in equity or at
law).

B - 4

	4. 	Termination 

     This Agreement shall terminate
automatically and without further action on behalf of any party at the earlier
of (a) the Effective Time and (b) the date and time, if any, that the
Arrangement Agreement is terminated pursuant to its terms. In the event of a
termination of this Agreement pursuant to this Section 4, this Agreement shall
forthwith become void and there shall be no liability or obligation on the part
of any party, but nothing herein shall release the Shareholder for any breach of
this Agreement. If this Agreement is terminated, any proxy of the Shareholder
delivered under Section 1(b) hereof shall also terminate and be of no further
force or effect, and TAG shall promptly return the proxy to the Shareholder.

	5. 	
      Miscellaneous

	 	 	 	 
		(a) 	
      Fiduciary Obligations. This Agreement is intended
      to bind the Shareholder only with respect to the specific matters set
      forth herein, and will not prohibit such Shareholder from acting in
      accordance with such Shareholder’s fiduciary duties as an officer or
      director of the Company.

	 	 	 	 
		(b) 	
      Notices. All notices and other communications
      hereunder shall be in writing and shall be deemed given if delivered
      personally, effective when delivered, or by express courier service,
      effective one business day after delivery to such courier, or by telecopy,
      effective when transmitted and a confirmation is received, provided the
      same is on a business day, and, if not, on the next business day, to the
      parties at the following addresses (or at such other address for a party
      or to such other person’s attention as shall be specified by like
      notice):

	 	 	 	 
			(i) 	
      If to a Shareholder: to the address listed for the
      Shareholder on Annex A.

	 	 	 	 
			(ii) 	
      If to TAG, to:

	 	 	 	 
				
      TAG Oil Ltd. 
1050 Burrard Street 
Suite 2901
      
Vancouver, BC V6Z 2S3

	 	 	 	 
				
      Facsimile: 604-682-1174 
Attention: Chief Executive
      Officer

	 	 	 	 
		(c) 	
      Headings. The headings contained in this Agreement
      are solely for the purpose of reference, and are not part of the agreement
      of the parties and shall not affect in any way the meaning or
      interpretation of this Agreement.

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

	 	 	 	 
		(e) 	
      Entire Agreement. This Agreement (along with the
      documents and instruments referred to herein, including the Arrangement
      Agreement), embody the entire agreement and understanding of the parties
      hereto in respect of the subject matter contained herein. This Agreement
      supersedes all prior agreements and understandings between the parties
      with respect to such subject matter.

B - 5

	 	(f) 	
      Severability. The invalidity or unenforceability
      of any provision of this Agreement shall not affect the validity or
      enforceability of any other provisions of this Agreement. Whenever
      possible, each provision of this Agreement will be interpreted in such
      manner as to be effective and valid under applicable law.

	 	 	 
	 	(g) 	
      Governing Law. This Agreement shall be governed by
      the laws of the Province of British Columbia, without regard to its
      conflict-of-laws rules. The parties hereto expressly consent to
      jurisdiction and venue for any litigation arising out of this Agreement in
      the proper court in the Province of British Columbia.

	 	 	 
	 	(h) 	
      Assignment. Neither this Agreement nor any of the
      rights, interests, or obligations hereunder may be assigned by any party,
      whether by operation of law or otherwise, without the express written
      consent of the other party. Subject to the preceding sentence, this
      Agreement will be binding upon, inure to the benefit of, and be
      enforceable by the parties and their respective successors, heirs, legal
      representatives, and permitted assigns. The representations, agreements,
      and obligations of the Shareholder contained herein shall survive the
      death or incapacity of the Shareholder and shall be binding upon the
      heirs, personal representatives, successors, and assigns of the
      Shareholder.

	 	 	 
	 	(i) 	
      Remedies. In addition to all other remedies
      available, the parties agree that, in the event of a breach by a party of
      any of its obligations hereunder, the non-breaching party shall be
      entitled to specific performance or injunctive relief.

	 	 	 
	 	(j) 	
      Defined Terms. All capitalized terms used but not
      defined herein have the meanings given them in the Arrangement
      Agreement.

	 	 	 
	 	(k) 	
      Waiver. Prior to the Effective Date, any provision
      of this Agreement may be waived by the party or parties benefited by the
      provision. Waiver of any term or condition of this Agreement (including
      any extension of time required for performance) will only be effective if
      in writing and will not be construed as a waiver of any subsequent breach
      or waiver of the same term or condition, or a waiver of any other term or
      condition of this Agreement. No delay on the part of any party in
      exercising any right, power or privilege hereunder will operate as a
      waiver thereof.

	 	 	 
	 	(l) 	
      Further Assurances. From time to time, at TAG’s
      request and without further consideration, each Shareholder shall execute
      and deliver such additional documents and take all such further lawful
      action as may be reasonably necessary to consummate and make effective, in
      the most expeditious manner practicable, the transactions contemplated by
      this Agreement.

[Signature Page Follows]

B - 6

Each of the parties has signed this
Agreement as of the date first written above.

	 	TAG OIL LTD. 
	 	 	 
	 	By 	 

[Signature Page to Lock-Up Agreement]

B - 7

	 	SHAREHOLDERS 
	 	  	 
	 	  	 
	 	By 	 
	 	 	o 
	 	  	 
	 	  	 
	 	  	 
	 	  	 
	 	By 	 
	 		o 
	 	  	 
	 	  	 
	 	  	 
	 	  	 
	 	By 	 
	 	 	o 
	 	  	 
	 	  	 
	 	  	 
	 	  	 
	 	By 	 
	 	 	o  

[Signature Page to Lock-Up Agreement]

ANNEX A

	Name and Address of 
Shareholder 	
Registered Holder 	
Number and Type of Securities
  
	[Name] 
[Address] 
[City, Province] 
[Country] 	

	

	[Name] 
[Address] 
[City, Province] 
[Country] 	

	

	[Name] 
[Address] 
[City, Province] 
[Country] 	

	

	[Name] 
[Address] 
[City, Province] 
[Country]wydi8k20090916ex10-1.htm

MARKETING & LEAD GENERATION AGREEMENT

This Marketing & Lead Generation Agreement (the “Agreement”) is made and entered into as of this 16th day of September 2009, by and between Who’s Your Daddy, Inc., a Nevada corporation (the “Company”) and Gigamind Inc., a  Canadian corporation (the “Consultant”) (individually, a “Party”;
collectively, the “Parties”).

RECITALS

WHEREAS, Consultant has significant experience in the areas of marketing of internet products and furthering business transactions and relationships through its existing lead lists and M-Wallet leads and;

WHEREAS, Consultant has extensive business relationships with affiliates whose expertise is website design, internet lead generation, and creation and optimization of product offerings through the internet;

WHEREAS, the Company desires to retain Consultant to assist with the implementation of the internet marketing strategy for the launch of its new Who’s Your Daddy Fit Energy Shot with Resveratrol.

NOW, THEREFORE, in consideration of the mutual promises herein contained, the Parties hereby agree as follows:

1.         CONSULTING SERVICES

Attached hereto as Exhibit A and incorporated herein by this reference is a description of the services to be provided by the Consultant hereunder (the “Consulting Services”).  Consultant hereby agrees to utilize its best efforts in performing the Consulting Services, however, Consultant makes no warranties, representations,
or guarantees regarding any corporate strategies attempted by the Company or the eventual effectiveness of the Consulting Services.

2.         TERM OF AGREEMENT

This Agreement shall be in full force and effect commencing upon the date hereof and shall have a term of 24 months therefrom.  Either Party hereto shall have the right to terminate this Agreement without notice in the event of the death, bankruptcy, insolvency, or assignment for the benefit of creditors of the other Party.  Consultant
shall have the right to terminate this Agreement if Company fails to comply with the terms of this Agreement and such failure continues unremedied for a period of 45 days after written notice to the Company by Consultant. The Company shall have the right to terminate this Agreement upon delivery to Consultant of notice setting forth with specificity facts comprising a material breach of this Agreement by Consultant.  Consultant shall have 45 days to remedy such breach.

 

3.         TIME DEVOTED BY CONSULTANT

It is anticipated that the Consultant shall spend as much time as deemed necessary by the Consultant in order to perform the obligations of Consultant hereunder.  The Company understands that this amount of time may vary and that the Consultant may perform Consulting Services for other
companies.

  

1

  

4.        PLACE WHERE SERVICES WILL BE PERFORMED

The Consultant will perform most Consulting Services in accordance with this Agreement at Consultant’s offices located at 30 Spruce Street, Toronto, On. M5A 2H9.  In addition, the Consultant will perform Consulting Services on the telephone and at such other place(s) as necessary to perform these services in accordance with
this Agreement.

5.        INDEPENDENT CONTRACTOR

Both Company and the Consultant agree that the Consultant will act as an independent contractor in the performance of his duties under this Agreement.  Nothing contained in this Agreement shall be construed to imply that Consultant, or any employee, agent or other authorized representative of Consultant, is a partner, joint venturer,
agent, officer or employee of Company.

6.        COMPENSATION TO CONSULTANT

The Consultant's compensation for the Consulting Services shall be as set forth in Exhibit B attached hereto and incorporated herein by this reference.  The Consultant will be solely responsible for all tax returns and payments required to be filed with or made to any federal, state or local tax authority with respect to the Consultant’s
performance of services and receipt of fees under this Agreement.  The Company will regularly report amounts paid, if any, to the Consultant by filing Form 1099-MISC and/or other appropriate form with the Internal Revenue Service as required by law.  Because the Consultant is an independent contractor, the Company will not withhold or make payments for social security; make contract insurance or disability insurance contributions; or obtain worker’s compensation insurance on the Consultant’s
behalf.  The Consultant agrees to accept exclusive liability for complying with all applicable state and federal laws governing self-employed individuals, including obligations such as payment of taxes, social security, disability and other contributions based on fees paid to the Consultant under this Agreement.  The Consultant hereby agrees to indemnify and defend the Company against any and all such taxes or contributions, including penalties and interest.

7.        CONFIDENTIAL INFORMATION

The Consultant and the Company acknowledge that each will have access to proprietary information regarding the business operations of the other and agree to keep all such information secret and confidential and not to use or disclose any such information to any individual or organization without the non-disclosing Parties prior written consent.  It
is hereby agreed that from time to time Consultant and the Company may designate certain disclosed information as confidential for purposes of this Agreement.

8.         INDEMNIFICATION

Each Party (the “Indemnifying Party”) agrees to indemnify, defend, and hold harmless the other Party (the “Indemnified Party”) from and against any and all claims, damages, and liabilities, including any and all expense and costs, legal or otherwise, caused by the
negligent act or omission of the Indemnifying Party, its subcontractors, agents, or employees, incurred by the Indemnified Party in the investigation and defense of any claim, demand, or action arising out of the work performed under this Agreement; including breach of the Indemnifying Party of this Agreement.  The Indemnifying Party shall not be liable for any claims, damages, or liabilities caused by the sole negligence of the Indemnified Party, its subcontractors, agents, or employees.

  

2

  

The Indemnified Party shall notify promptly the Indemnifying Party of the existence of any claim, demand, or other matter to which the Indemnifying Party’s indemnification obligations would apply, and shall give them a reasonable opportunity to settle or defend the same at their own expense and with counsel of their own selection,
provided that the Indemnified Party shall at all times also have the right to fully participate in the defense.  If the Indemnifying Party, within a reasonable time after this notice, fails to take appropriate steps to settle or defend the claim, demand, or the matter, the Indemnified Party shall, upon written notice, have the right, but not the obligation, to undertake such settlement or defense and to compromise or settle the claim, demand, or other matter on behalf, for the account, and at the risk,
of the Indemnifying Party.

The rights and obligations of the Parties under this Article shall be binding upon and inure to the benefit of any successors, assigns, and heirs of the Parties.

9.        COVENANTS OF CONSULTANT

Consultant covenants and agrees with the Company that, in performing Consulting Services under this Agreement, Consultant will:

(a)                 Comply with all federal and state laws;

(b)                 Not make any representations other than those authorized by the Company; and

(c)                 Not publish, circulate or otherwise use any materials or documents other than materials provided by or otherwise approved by the Company.

10.      MISCELLANEOUS

(A)         This Agreement shall be constructed and interpreted in accordance with and the governed by the laws of the State of California.

(B)         The Parties agree that the Courts of the County of Orange, State of California shall have sole and exclusive jurisdiction and venue for the resolution of all disputes arising under the terms of this Agreement and the transactions contemplated herein.

  

3

  

(C) ARBITRATION OF DISPUTES.

 

ANY CONTROVERSY OR CLAIM RELATING TO OR ARISING OUT OF THIS AGREEMENT SHALL BE SETTLED IN ORANGE COUNTY, CALIFORNIA BY ARBITRATION IN ACCORDANCE WITH JAMS ARBITRATION RULES APPLICABLE TO EMPLOYMENT DISPUTES (THE “JAMS RULES”).  JUDGMENT UPON THE AWARD RENDERED BY THE ARBITRATOR(S) MAY BE ENTERED IN ANY COURT HAVING JURISDICTION.  ALL
PARTIES TO THE ARBITRATION SHALL BE ENTITLED TO THE FULL RANGE OF DISCOVERY PROVIDED UNDER CALIFORNIA CODE OF CIVIL PROCEDURE SECTION 1283.05.

 

THIS AGREEMENT IS GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA, IRRESPECTIVE OF CALIFORNIA’S CHOICE-OF-LAW PRINCIPLES.

 

BY SIGNING THIS AGREEMENT THE PARTIES ARE AGREEING TO HAVE ANY DISPUTE ARISING OUT OF THIS AGREEMENT DECIDED BY NEUTRAL ARBITRATION AS PROVIDED BY CALIFORNIA LAW AND ARE GIVING UP ANY RIGHTS THEY MIGHT POSSESS TO HAVE THE DISPUTE LITIGATED IN A COURT OR JURY TRIAL.  BY SIGNING THIS AGREEMENT THE PARTIES ARE GIVING UP THEIR JUDICIAL
RIGHTS TO APPEAL.  IF EITHER PARTY REFUSES TO SUBMIT TO ARBITRATION AFTER AGREEING TO THIS PROVISION, THEY MAY BE COMPELLED TO ARBITRATE UNDER THE AUTHORITY OF THE CALIFORNIA CODE OF CIVIL PROCEDURE. THE PARTIES AGREEMENT TO THIS ARBITRATION PROVISION IS VOLUNTARY.

(D)         This Agreement shall inure to the benefit of the Parties hereto, their administrators and successors in interest.  This Agreement shall not be assignable by either Party hereto without the prior written consent of the other; which will not be unreasonably withheld.

(E)         This Agreement contains the entire understanding of the Parties and supersedes all prior agreements between them.

(F)         No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by the Parties.  No waiver of any of the provisions of this Agreement shall be deemed, or shall constitute, a waiver of any other provision, whether or not similar, nor shall
any waiver constitute a continuing waiver.  No waiver shall be binding unless executed in writing by the Party making the waiver.

(G)         If any provision hereof is held to be illegal, invalid or unenforceable under present or future laws effective during the term hereof, such provision shall be fully severable.  This Agreement shall be construed and enforced as if such illegal, invalid or unenforceable provision
had never comprised a part hereof, and the remaining provisions hereof shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance herefrom.

  

4

  

IN WITNESS WHEREOF, the Parties hereto have placed their signatures hereon on the day and year first above written.

	
COMPANY:
	  	
CONSULTANT:

	  	  	  
	
WHO’S YOUR DADDY, INC.
	  	
Gigamind Inc.

	
a Nevada corporation
	  	
a Canadian corporation

	  	  	  
	  	  	  
	  	  	  
	
/s/ Michael R. Dunn
	  	
/s/ Gary Chaikin

	
By:  Michael R. Dunn
	  	
By:  Gary Chaikin

	
Its:  Chief Executive Officer
	  	
Its:  Chief Executive Officer

 

  

5

  

EXHIBIT A

DESCRIPTION OF CONSULTING SERVICES

Consultant has the latest proprietary email sending software.  The Consultant’s goal is to improve returns on the Company’s marketing efforts by utilizing effective solutions. The Consultant’s list of approximately 40 million thoroughly qualified quality e-mails are currently broken down by State. The Consulting
Services shall include, but not be limited to, the following pursuant to the terms of this Agreement;

 

	
  
	
·
	
Arranging for the development of an Landing Page to market certain of the Company’s products;

	
  
	
·
	
Arranging for the use of an established merchant account, currently Blackstone Merchant Services, Inc. (“Blackstone”), for the purpose of allowing the Company’s customers to use credit cards.  The merchant account will require an initial 3.5% processing fee (to be reduced based on performance), a $0.35 per transaction fee and a $.10 per transaction
gateway access fee.   The gateway access fee will be a minimum of $19.99 per month.  In addition, there will be a monthly charge of $10.00 for merchant statement.  The funds in the merchant account shall be encumbered for the benefit of outside investors for funding the production of the inventory and operating expenses related to the internet marketing program.

A reserve within the merchant account will be established for the first 60 days (“Initial Holdback Period”) to determine chargeback history with regard to the Company’s sales.  This reserve will initially be equal to 100% of deposits from customers for the Company’s products, excluding the charge for shipping,
handling and sales tax where applicable, as these costs are non-refundable.  This cost will be converted to a percentage once we have contracted with the fulfillment center.  At the 60 day mark, a rolling reserve will be coordinated between Consultant and Blackstone depending on the chargeback history shown on the account and the transactional activity, which rolling reserve will not be more than 25%.  During this period Consultant will manage the flow of emails to keep the number of
transactions within a range specified by the Company and designed to also provide enough information and a clear pattern for the merchant account processor.  It is anticipated that Consultant will ultimately have a 20% reserve holdback presuming that the chargeback history is within reasonable parameters.  It is also anticipated that Consultant’s reserve holdback period will be reduced from the initial 60 day period to 30 days (each reduced time period being the “Adjusted Holdback
Period”).

At the end of the Initial Holdback Period, the funds in the merchant account will be transferred to the Company’s account on a recurring daily basis in accordance with the Adjusted Holdback Period.   Consultant will write to the supplied Gateway API in order to link the Company’s site to the backend gateway.  The
Company’s account to which the funds are transferred shall be encumbered for the benefit of outside investors for funding the production of the inventory and operating expenses related to the internet marketing program.

	
  
	
·
	
Consultant will initially provide to the Company a minimum of 5 million qualified double opt out email leads for the Company’s product offerings.  It is understood by both parties that Consultant has another 35,000,000 double opt out email leads which could be available to the Company on the same terms as stated in this document depending on the success of the initial 5,000,000 lead rollout.

  

6

  

PHASE 1-Test/Trial

PHASE 1, which is the Test/Trial e-mail campaign, will be implemented as follows:

	
  
	
1.
	
Consultant will segment and send out two tranches of emails of 1,000,000 at a time customized depending on the offer and the Company’s ability to handle the response  through the fulfillment and call centers.

	
  
	
2.
	
The setup cost is waived and there will be no setup cost for the control panel tracking the campaign; however Consultant will fine-tune and change the graphics at negotiated designated points during the Phase 1 campaign.

	
  
	
3.
	
The custom configured control panel of the Consultant’s tracking and management software for the Company’s emailing campaign will be designed for segmenting emails.  The emails will be divided into set amounts and will be sent out at certain times agreed to by the Company and Consultant through their automated system.

	
  
	
4.
	
Graphics will be included in the email campaign at no cost due to revenue sharing structure.

	
  
	
5.
	
Consultant will work with the Company to test an incentive bonus or bonus offer in order to provide extra traction for the deal if agreed to by both parties. If there is a cost associated with this incentive offer the Company will cover the entire cost.

	
  
	
6.
	
The Consultant will analyze the 2 million email responses in increments for validating Phase One offering results.

PHASE 2 – Scheduled for October 15, 2009

	
  
	
1.
	
Company will provide Consultant with the basic offer and/or graphics and Consultant will have their designers send the e-mail with a click through link.

	
  
	
2.
	
Consultant will provide a landing page based on similar information that the person goes to after clicking through.

	
  
	
3.
	
Consultant will setup up a  custom control panel that can be by viewed by the Company for real-time results.

	
  
	
4.
	
Consultant will confirm the payment gateway and run a series of tests for handling cancellations, billing, appropriate taxes, and interfacing with the fulfillment center for shipping free trial offers.

	
  
	
5.
	
Consultant is presented with the incentive offer (if applicable) to be added into the graphics.

	
  
	
6.
	
The  incentive offer (if applicable) will be given back to the Company with testing results for determining if the inclusion in the email is financially feasible.

	
  
	
7.
	
The customer call service center will be setup with Fusion BPO Services Inc. to handle customer questions or cancellations.

	
  
	
8.
	
Reconciliation process of all deals and sales will be reconciled on a negotiated timeline prior to Phase 2 launch.

	
  
	
9.
	
All materials must include a signoff by the Company, Leigh Steinberg Sports & Entertainment LLC (“LSSE”) and Consultant.

	
  
	
10.
	
All Graphics must include a signoff by the Company, LSSE and Consultant.

	
  
	
11.
	
Upon written signoffs by the Company, LSSE and Consultant of all materials, Consultant will be given written instructions to begin the email campaign.

  

7

  

EXHIBIT B

TERMS OF COMPENSATION

The Consultant’s compensation hereunder shall be as follows:

1.         FEE PAID FOR LEAD LIST.  As compensation for the Consulting Services, and subject to the terms and conditions of this
Agreement, Company will pay to Consultant a total fee of $1,000.00 per each one million leads used by the Company.  In addition, the Company will pay a maximum fee of $4,500.00 for designing the landing page and Graphics for E-commerce, as well as the merchant gateway custom viewer.

2.         FEE PAID FOR LEADS ON FIRST REORDER.  As compensation for the Consulting Services, and subject to the terms and conditions
of this Agreement, the Company will pay to the Consultant a fee of $20 for each lead which has a successful first rebilling on the customer’s credit card without subsequent refund request.  The fee would be taken out of the merchant account with a signoff by an appointed person who is a party to this Agreement.

3.         BACKEND PARTIPATION FEE.  Consultant shall be paid a $12.50 fee on the second reorder, and all other subsequent reorders
without subsequent refund request, which fee would be taken out of the merchant account with a signoff by an appointed person who is a party to this Agreement.

 

 

8

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