Document:

Canyon Copper Corp. - Exhibit 10.16 - Filed by newsfilecorp.com

May 26, 2011

CANYON COPPER CORP. 
1199 West Pender Street, Suite
408
Vancouver, British Columbia 

  V6E 2R1 

	Attention: 	Tony Harvey 
	  	Chairman 

Re:        Private
Placement of Units consisting of Common Shares and Warrants 

MGI Securities Inc. (the “Agent”) understands that
Canyon Copper Corp. (being the “Corporation” as hereinafter defined)
proposes to issue, by way of private placement, up to 4,285,714 units in the
capital of the Corporation as presently constituted (the “Units”) at a
subscription price of CDN$0.35 per Unit, each such Unit consisting of one Common
Share (as defined herein) (each a “Unit Share”) and one-half of one
non-transferable Common Share purchase warrant (each whole non-transferable
Common Share purchase warrant being hereinafter referred to as a
“Warrant”) where, subject to the Acceleration Warrant Deadline (as
defined herein), each whole Warrant is exercisable into one Common Share of the
Corporation (a “Warrant Share”) to the extent exercised at any time prior
to 5:00 p.m. (Vancouver time) on the date that is 18 months from the Liquidity
Date (as defined herein) (the “Warrant Exercise Period”) upon payment to
the Corporation of CDN$0.50 (the “Brokered Offering”). 

The Corporation also proposes to grant and does hereby grant to
the Agent the option (the “Over-Allotment Option”) to increase the
Brokered Offering by up to 4,285,714 in additional Units (the “Optioned
Securities”). If the Agent elects to exercise such Over-Allotment Option,
the Agent shall notify the Corporation in writing not later than the fifth
Business Day (as defined herein) following the final Closing Date (in the event
of multiple Closings), which notice shall specify the number of Optioned
Securities to be purchased by Subscribers located by the Agent. The sale of the
Optioned Securities shall be completed on or before the tenth Business Day
following the final Closing Date. Optioned Securities may be purchased solely
for the purpose of covering over-subscriptions placed with the Agent in
connection with the Brokered Offering. In the event that the Corporation shall
subdivide, consolidate, reclassify or otherwise change its Common Shares or
Warrants during the period in which the Over-Allotment Option is exercisable,
appropriate adjustments will be made to the exercise price of the Over-Allotment
Option and to the number of Optioned Securities issuable on exercise thereof
such that the Subscribers for the Optioned Securities shall be entitled to
receive the same number and type of securities that such Subscribers would have
otherwise received had the Agent exercised such Over-Allotment Option
immediately prior to such subdivision, consolidation, reclassification or
change. 

The Unit Offering (as defined herein) shall be comprised of (i)
the Brokered Offering of up to CDN$1,500,000 in Units issued pursuant to this
Agreement (as defined herein), (ii) the Over-Allotment Option of up to
CDN$1,500,000 in Units and (iii) a non-brokered offering of up to CDN$1,500,000
in Units issued at a subscription price of CDN$0.35 per Unit to certain
purchasers that will place their subscriptions directly with the Corporation
(the “Non-Brokered

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Offering”), or such other allocation of Units
between the Brokered Offering and the Non-Brokered Offering as the Agent and the
Corporation shall agree (the “Allocation Adjustment”). The Non-Brokered
Offering shall close prior to or concurrently with the Brokered Offering. The
maximum gross proceeds to be raised under the Brokered Offering, the
Over-Allotment Option and the Non-Brokered Offering shall equal up to
CDN$4,500,000 (the “Unit Offering”). 

The Units, Unit Shares, Warrants and Warrant Shares offered
pursuant to the Brokered Offering and the Over-Allotment Option are collectively
referred to herein as the “Securities”. The Securities may be offered by
the Agent to purchasers in the Offering Jurisdictions (as defined herein). 

Subject to the terms and conditions hereof, the Agent hereby
agrees to act, and the Corporation hereby appoints the Agent as the exclusive
agent of the Corporation to offer the Securities for sale on a private placement
basis in the Offering Jurisdictions and to use its best efforts and without
underwriter liability to secure subscriptions therefor, provided that the Agent
shall not be under any obligation to purchase any of the Securities. The Agent
shall be entitled, in its sole discretion, to form a selling group (the
“Selling Group”) and engage therefor any other registered dealer to act
as a sub-agent, and offer such sub-agent as compensation any part of the sales
commission or the Agent’s Compensation Options (as defined herein). For greater
clarity, the Corporation shall not be liable for the compensation of any such
Selling Group member over and above the sales commission or the Agent’s
Compensation Options. The Agent shall, however, be under no obligation to engage
any sub-agent. In the event the conditions to be satisfied by the Closing Time
(as defined herein) are not met or waived as herein contemplated, all
Subscription Funds (as defined herein) shall be returned to the Subscribers (as
defined herein) thereof without interest or deduction and the Corporation shall
pay the Agent’s Expenses (as defined herein) provided for in section 9.2. 

In consideration for its services hereunder, including but not
limited to acting as financial advisor to the Corporation and advising on the
terms, conditions and structuring of the Brokered Offering, the Agent shall be
entitled to receive the consideration provided for in section 9.1 herein. 

The following are the further terms and conditions of this
Agreement: 

ARTICLE 1 

  INTERPRETATION

	1.1 	
      As used in this Agreement, including the paragraphs prior
      to this definitional section and any amendments hereto, unless the context
      otherwise requires:

	 	 	 
		(a) 	
      “Acceleration Notice” means the notice of the
      Corporation notifying the Subscriber within 10 Business Days of the
      Trigger Event of its exercise of the Acceleration Right, receipt of such
      notification to be calculated on (i) the date of receipt if the
      notification is delivered to the Subscriber in person to the last address
      registered on the shareholder register of the Corporation (ii) the second
      day after the post-mark date if delivered to the Subscriber by mail or
      (iii) the fifth

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day after such notification is
delivered pursuant to (i) or (ii) above to any market intermediary then holding
the Warrants of the Subscriber in any trust account; 

	 	(b) 	
      “Acceleration Right” means, upon the occurrence of
      any Trigger Event, the Corporation’s right to accelerate the expiry date
      of any Warrants held by Subscribers;

	 	 	 
	 	(c) 	
      “Acceleration Warrant Deadline” means the date
      that is 30 Business Days after the receipt of the Acceleration Notice by
      the Subscriber or any market intermediary, as applicable, after which that
      portion of the Warrants subject to the Acceleration Notice and held by the
      Subscriber which remain unexercised shall be deemed to have
  expired;

	 	 	 
	 	(d) 	
      “Agent” means MGI Securities Inc.;

	 	 	 
	 	(e) 	
      “Agent’s Additional Expenses” shall have the
      meaning as set out in section 9.3 herein;

	 	 	 
	 	(f) 	
      “Agent’s Compensation Options” means the
      non-assignable compensation options issued to the Agent or a Selling Group
      member at any Closing pursuant to section 9.1(c) herein;

	 	 	 
	 	(g) 	
      “Agent’s Counsel” means Blaney McMurtry LLP or
      such other legal counsel as the Agent may appoint;

	 	 	 
	 	(h) 	
      “Agent’s Expenses” shall have the meaning as set
      out in section 9.2 herein;

	 	 	 
	 	(i) 	
      “Agent’s Notice” shall have the meaning as set out
      in section 20.2 herein;

	 	 	 
	 	(j) 	
      “Agent’s Unit”, “Agent’s Unit Share”,
      “Agent’s Warrant” and “Agent’s Warrant Share” shall have the
      meaning as set out in section 9.1(c) herein;

	 	 	 
	 	(k) 	
      “Agreement” means this agreement between the Agent
      and the Corporation and not any particular Article or section or other
      portion except as may be specified, and words such as “hereto”,
      “herein”, “hereunder”, “hereof” and “hereby”
      refer to this Agreement as the context requires;

	 	 	 
	 	(l) 	
      “Allocation Adjustment” shall have the meaning as
      set out on page 2 hereof;

	 	 	 
	 	(m) 	
      “Applicable Business Laws” means all applicable
      federal, provincial or state legislation and regulations thereto (i)
      pursuant to which the Corporation is incorporated, continued or
      amalgamated and (ii) of each jurisdiction in which the nature of the
      Corporation’s assets and business make registration, licensing and/or
      qualification necessary;

	 	 	 
	 	(n) 	
      “Applicable Securities Laws” means all applicable
      securities laws, rules, regulations, instruments, notices, blanket orders,
      statements, circulars, procedures and policies in the Designated Provinces
      and immediately upon the closing of the

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Liquidity Event shall include all
published policies, rules and regulations of the Recognized Exchange, in each
case having the force of law on the date thereof; 

	 	(o) 	
      “BCI 51-509” means British Columbia Instrument
      51-509 - Issuers Quoted in the U.S. Over-the-Counter
  Market;

	 	 	 
	 	(p) 	
      “BC Legend” shall have the meaning as set out in
      subsection 10.4(a) herein;

	 	 	 
	 	(q) 	
      “BCSC” means the British Columbia Securities
      Commission;

	 	 	 
	 	(r) 	
      “Brokered Offering” shall have the meaning as set
      out on page 2 hereof;

	 	 	 
	 	(s) 	
      “Business Day” means a day, other than Saturdays,
      Sundays and statutory holidays, when the banks conducting business in the
      City of Vancouver, British Columbia are generally open for the transaction
      of banking business;

	 	 	 
	 	(t) 	
      “Closing” means, on any Closing Date, the
      acceptance of the Subscription Agreements and the Subscription Funds by
      the Corporation and the execution and delivery of certificates for the
      Securities sold by the Corporation;

	 	 	 
	 	(u) 	
      “Closing Date” means June 29, 2011 or such other
      date or dates as the Agent and the Corporation may agree and in the event
      of two or more Closings means the date on which the applicable Closing
      occurs;

	 	 	 
	 	(v) 	
      “Closing Time” means 10:00 a.m. (Vancouver time)
      or such other time of Closing, on the Closing Date, upon which the Agent
      and the Corporation may agree;

	 	 	 
	 	(w) 	
      “Common Share” as used herein means a share in the
      common stock of the Corporation, as constituted on the date hereof and is
      deemed to include such shares in the common stock of the Corporation as
      constituted immediately upon closing of the Liquidity Event;

	 	 	 
	 	(x) 	
      “Corporation” means Canyon Copper Corp.;

	 	 	 
	 	(y) 	
      “Corporation’s Counsel” means O'Neill Law
      Corporation or such other legal counsel as the Corporation with the
      consent of the Agent may appoint;

	 	 	 
	 	(z) 	
      “Corporation’s Notice” shall have the meaning as
      set out in section 20.1 herein;

	 	 	 
	 	(aa) 	
      “Declaration” shall have the meaning as set out in
      section 12.1 herein;

	 	 	 
	 	(bb) 	
      “Designated Provinces” means each of the provinces
      and territories of Canada to the extent that any Subscribers are resident
      therein;

	 	 	 
	 	(cc) 	
      Effective Date” shall have the meaning as set out
      in section 11.1 herein;

	 	 	 
	 	(dd) 	
      “Effective Period” shall have the meaning as set
      out in section 11.1 herein;

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	 	(ee) 	
      “Environmental Laws” shall have the meaning as set
      out in clause 5.1(dd)(i) herein;

	 	 	 
	 	(ff) 	
      “Financial Statements” means, collectively, the
      audited consolidated comparative financial statements of the Corporation
      for the years ended June 30, 2009 and June 30, 2010 and the unaudited
      financial statements of the Corporation for the nine months ended March
      31, 2011;

	 	 	 
	 	(gg) 	
      “Government Authority” shall have the meaning as
      set out in clause 5.1(dd)(iii) herein;

	 	 	 
	 	(hh) 	
      “Indemnified Parties” and “Indemnified Person”
      shall have the meanings as set out in section 14.1 herein;

	 	 	 
	 	(ii) 	
      “IPO” means a distribution to the public of Common
      Shares in Canada or the United States pursuant to a prospectus or
      registration statement and the concurrent listing of the Common Shares for
      trading on a Recognized Exchange;

	 	 	 
	 	(jj) 	
      “Liabilities” shall have the meaning as set out in
      section 14.1 herein;

	 	 	 
	 	(kk) 	
      “Liquidity Event” means the completion by the
      Corporation of (i) an IPO, (ii) a merger or (ii) another transaction as a
      result of which all outstanding Common Shares, or the securities of
      another issuer issued in exchange for all such outstanding Common Shares,
      are traded on a Recognized Exchange and are freely tradable (subject to
      control block restrictions);

	 	 	 
	 	(ll) 	
      “Liquidity Date” means the date the public notice
      announcing that the common shares are listed and freely tradable on the
      Recognized Exchange is published on the website of the Recognized
      Exchange;

	 	 	 
	 	(mm) 	
      “Material Contract” means any contract to which
      the Corporation is a party which is material to the Corporation;

	 	 	 
	 	(nn) 	
      “Maximum Subscription”, subject to the Allocation
      Adjustment, means CDN$1,500,000 with respect to the Offering, excluding
      the Over-Allotment Option;

	 	 	 
	 	(oo) 	
      “NI 45-106” means National Instrument 45-106 –
      Prospectus and Registration Exemptions as adopted by the Canadian
      Securities Administrators;

	 	 	 
	 	(pp) 	
      “Non-Brokered Offering” shall have the meaning as
      set out on page 2 hereof;

	 	 	 
	 	(qq) 	
      “Offering Jurisdictions” means the Designated
      Provinces and such other jurisdictions, other than the United States of
      America, as the Agent and the Corporation may agree prior to the Closing
      Date;

	 	 	 
	 	(rr) 	
      “Optioned Securities” shall have the meaning as
      set out on page 1 hereof;

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	 	(ss) 	
      “OTC reporting issuer” shall have the meaning as
      set out in BCI 51-509;

	 	 	 
	 	(tt) 	
      “Over-Allotment Option” shall have the meaning as
      set out on page 1 hereof;

	 	 	 
	 	(uu) 	
      “Preferred Shares” means shares of the
      Corporation’s preferred stock;

	 	 	 
	 	(vv) 	
      “PDF” means an electronic file format that has
      captured all the elements of a printed document as an electronic
    image;

	 	 	 
	 	(ww) 	
      “person” includes an individual, sole
      proprietorship, partnership, unincorporated association, unincorporated
      syndicate, unincorporated organization, trust, body corporate, and a
      natural person in his or her capacity as trustee, executor, administrator,
      or other legal representative;

	 	 	 
	 	(xx) 	
      “Public Record” means all information filed by and
      on behalf of the Corporation with the SEC or any Securities Commission,
      stock exchange, governmental agency, regulatory body or any other
      competent authority on or during the 12 months preceding the date
      hereof;

	 	 	 
	 	(yy) 	
      “Recognized Exchange” means the TSX Venture
      Exchange, a division of TSX Venture Exchange Inc. or any other such
      recognized stock exchange in Canada on which the securities of the
      Corporation are listed;

	 	 	 
	 	(zz) 	
      “Registration Statement” shall have the meaning as
      set out in section 11.1 herein;

	 	 	 
	 	(aaa) 	
      “reporting issuer” shall have the meaning as set
      out in the Securities Act (British Columbia);

	 	 	 
	 	(bbb) 	
      “ROFR Period” shall have the meaning as set out in
      section 20.1 herein;

	 	 	 
	 	(ccc) 	
      “SEC” means the United States Securities and
      Exchange Commission;

	 	 	 
	 	(ddd) 	
      “Securities” shall have the meaning as set out on
      page 2 hereof;

	 	 	 
	 	(eee) 	
      “Securities Commissions” means the securities
      commissions or similar regulatory authorities in the Designated
      Provinces;

	 	 	 
	 	(fff) 	
      “Selling Group” shall have the meaning as set out
      on page 2 hereof;

	 	 	 
	 	(ggg) 	
      “Subscriber” means a person who subscribes for,
      and upon Closing, purchases the Units described herein;

	 	 	 
	 	(hhh) 	
      “Subscription Agreements” means the subscription
      agreements to be entered into at Closing between the Corporation and each
      of the Subscribers setting out the contractual relationship between the
      Corporation and the Subscribers, in form and substance satisfactory to the
      Corporation and the Agent;

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	 	(iii) 	
      “Subscription Funds” means all funds received with
      respect to all subscriptions for the Units placed by the Agent or any
      Selling Group member in accordance with the terms and provisions of this
      Agreement;

	 	 	 
	 	(jjj) 	
      “Subsidiary” has the meaning attributed thereto in
      NI 45-106 and includes any Subsidiary of the Corporation as listed in
      Schedule “A” attached hereto;

	 	 	 
	 	(kkk) 	
      “Trading Day” means any day in which the Common
      Shares trades on the Recognized Exchange.

	 	 	 
	 	(lll) 	
      “Transaction Agreements” means this Agreement, the
      Subscription Agreements, the certificates representing the Warrants and
      the certificates representing the Agent’s Compensation Options;

	 	 	 
	 	(mmm) 	
      “Transfer Agent” means Pacific Stock Transfer
      Company in its capacity as registrar and transfer agent for the Common
      Shares;

	 	 	 
	 	(nnn) 	
      “Trigger Event” shall have the meaning as set out
      in subsection 3.1(a) herein;

	 	 	 
	 	(ooo) 	
      “Units” shall have the meaning as set out on page
      1 hereof;

	 	 	 
	 	(ppp) 	
      “Unit Offering” shall have the meaning as set out
      on page 1 hereof;

	 	 	 
	 	(qqq) 	
      “Unit Share” shall have the meaning as set out on
      page 2 hereof;

	 	 	 
	 	(rrr) 	
      “U.S. Opinion” shall have the meaning as set out
      in section 12.1 herein;

	 	 	 
	 	(sss) 	
      “U.S. Person” means a “U.S. Person” as defined in
      Regulation S of the U.S. Securities Act;

	 	 	 
	 	(ttt) 	
      “U.S. Exchange Act” means the United States
      Securities Exchange Act of 1934, as amended;

	 	 	 
	 	(uuu) 	
      “U.S. Securities Act” means the United States
      Securities Act of 1933, as amended;

	 	 	 
	 	(vvv) 	
      “Warrant“ shall have the meaning as set out on
      page 1 hereof;

	 	 	 
	 	(www) 	
      “Warrant Exercise Period” shall have the meaning
      as set out on page 1 hereof;

	 	 	 
	 	(xxx) 	
      “Warrant Share” shall have the meaning as set out
      on page 1 hereof; and

	 	 	 
	 	(yyy) 	
      “Work Fee” shall have the meaning as set out in
      section 9.1 herein.

	1.2 	
      In addition, the terms “misrepresentation”,
      “material change” and “material fact” shall have the
      meanings ascribed thereto under Applicable Securities Laws and “distribution” or “distribution to the
      public”, as the case may be, shall also have the meaning as defined
      under Applicable Securities Laws and “distribute” has a
  corresponding meaning.

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ARTICLE 2 
OFFERING OF THE SECURITIES

	2.1 	
      The Corporation has prepared or will prepare the
      Subscription Agreements in compliance with Applicable Securities Laws and
      the Agent shall take all other reasonable steps and proceedings in
      compliance with Applicable Securities Laws that may be necessary to
      utilize the Subscription Agreements in connection with the Brokered
      Offering.

	 	 	 
	2.2 	
      The Corporation represents, warrants, covenants and
      agrees that its representations and warranties set forth in the
      Subscription Agreements are true and correct and that the Corporation will
      fully comply with the covenants and agreements of the Corporation set
      forth therein.

	 	 	 
	2.3 	
      The Agent will only sell the Securities to persons in the
      Offering Jurisdictions who represent themselves as being;

	 	 	 
		(a) 	
      persons purchasing as principal or deemed to be
      purchasing as principal under applicable securities laws or purchasing as
      authorized agent on behalf of a disclosed person that is purchasing as
      principal or deemed to be purchasing as principle under applicable
      securities laws in such Offering Jurisdictions;

	 	 	 
		(b) 	
      qualified to purchase Securities under applicable
      exemptions from any registration or prospectus requirements under the
      applicable securities laws in such Offering Jurisdictions; and

	 	 	 
		(c) 	
      persons who were not in the United States or U.S. Persons
      at the time the offer to purchase the Securities was made and at the time
      of the person’s decision to purchase the
Securities.

ARTICLE 3 

  ACCELERATION RIGHT

	3.1 	
      The Agent acknowledges and agrees that:

	 	 	 	 
		(a) 	
      that the Corporation shall have the right to exercise the
      Acceleration Right provided that:

	 	 	 	 
			(i) 	
      the Corporation has filed a Registration Statement with
      respect to the resale of the Warrant Shares by the Subscriber with the SEC
      and the SEC has declared the Registration Statement to be
  effective;

	 	 	 	 
			(ii) 	
      any resale restrictions under Applicable Securities Laws
      in Canada have expired; and

	 	 	 	 
			(iii) 	
      the closing price for the Common Shares on the Recognized
      Exchange is equal to or greater than CDN$0.60 for ten (10) consecutive
      Trading Days prior to the date that the Corporation exercises the
  Acceleration Right (the “Trigger Event”);

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	 	(b) 	
      to exercise the Acceleration Right, the Corporation shall
      send the Acceleration Notice to the Subscriber within 10 Business Days
      after the Trigger Event. If the Corporation exercises the Acceleration
      Right, the Subscribers shall exercise such Warrants on or before at 5:00
      PM Pacific time on the day that is 30 Business Days after the receipt of
      the Acceleration Notice of the Subscriber, after which time any
      unexercised Warrants then held by the Subscriber shall be deemed to have
      expired; and

	 	 	 
	 	(c) 	
      the Corporation will not affix a U.S. Legend on any share
      certificates representing the Warrant Shares provided that the
      Registration Statement has been declared effective by the SEC and that the
      Subscriber completes, executes and delivers to the Corporation the form of
      declaration attached to the Warrant with respect to the resale of the
      Warrant Shares under the Registration Statement.

ARTICLE 4 

  DUE DILIGENCE REVIEW

	4.1 	
      Prior to the Closing Time the Corporation shall allow the
      Agent the opportunity to conduct due diligence and to obtain, satisfactory
      results therefrom. In particular, the Corporation shall allow the Agent
      and the Agent’s Counsel to conduct all due diligence which the Agent may
      reasonably require or consider necessary or appropriate in order to
      confirm that the Public Record is accurate, complete and current in all
      material respects and to fulfill the Agent’s obligations as a registrant
      under Applicable Securities Laws and will provide to the Agent, Agent’s
      Counsel and any consultants of the Agent reasonable access to the
      properties, senior management personnel and corporate, financial and other
      records of the Corporation for the purposes of conducting such due
      diligence reviews.

ARTICLE 5 
REPRESENTATIONS AND
WARRANTIES

  OF THE CORPORATION 

	5.1 	
      The Corporation represents and warrants to the Agent and
      the Subscribers, and acknowledges that the Agent and Subscribers are
      relying upon such representations and warranties, that:

	 	 	 	 
		(a) 	
      the Corporation has full corporate power and authority to
      undertake the Brokered Offering contemplated hereby and with respect to
      the securities underlying the Units and:

	 	 	 	 
			(i) 	
      at the Closing Time, the Unit Shares and the Warrants
      will be duly and validly authorized and at Closing the Unit Shares will be
      issued as fully paid and non-assessable Common Shares of the Corporation,
      and

	 	 	 	 
			(ii) 	
      the Warrant Shares will have been duly reserved for
      issuance upon exercise of the Warrants and, upon due exercise of the
      Warrants in accordance with its terms, including payment to the
      Corporation of the exercise price therefor, each Warrant Share will be
      issued as a fully paid and non-assessable Common
Share;

- 10 -

	 	(b) 	
      the Corporation has full corporate power and authority to
      create and issue the Optioned Securities contemplated hereby and with
      respect to the securities underlying the Optioned Securities
and:

	 	 	 	 
	 		(i) 	
      at the Closing Time the Unit Shares and the Warrants
      underlying the Optioned Securities will be duly and validly authorized
      reserved for issuance to the holder of the Over-Allotment Option, and when
      the Over- Allotment Option is duly exercised in accordance with its terms,
      including payment to the Corporation of the exercise price therefor, the
      Unit Shares underlying the Optioned Securities will be issued as fully
      paid and non- assessable Common Shares of the Corporation, and

	 	 	 	 
	 		(ii) 	
      the Warrant Shares comprised within the Warrants
      underlying the Optioned Securities will have been duly reserved for
      issuance upon exercise of the Warrants and, upon due exercise of such
      Warrants and payment to the Corporation of the exercise price therefor,
      each Warrant Share will be issued as a fully paid and non-assessable
      Common Share;

	 	 	 	 
	 	(c) 	
      the Corporation has full corporate power and authority to
      create and issue the Agent’s Compensation Options contemplated hereby and
      with respect to the securities underlying the Agent’s Compensation
      Options, and:

	 	 	 	 
	 		(i) 	
      at the Closing Time the Agent’s Unit Shares and the
      Agent’s Warrants will be duly and validly authorized and the Agent’s Unit
      Shares will be duly reserved for issuance to the holder of the Agent’s
      Compensation Options and when the Agent’s Compensation Options are duly
      exercised in accordance with their terms, including payment to the
      Corporation of the exercise price therefor, the Agent’s Unit Shares
      underlying the Agent’s Compensation Options will be issued as fully paid
      and non-assessable Common Shares of the Corporation, and

	 	 	 	 
	 		(ii) 	
      the Agent’s Warrant Shares will have been duly reserved
      for issuance upon exercise of the Agent’s Warrants and, upon due exercise
      of the Agent’s Warrants and payment to the Corporation of the exercise
      price therefor, each Agent’s Warrant Share will be issued as a fully paid
      and non-assessable Common Share;

	 	 	 	 
	 	(d) 	
      the Corporation has no Subsidiaries;

	 	 	 	 
	 	(e) 	
      the Corporation has been duly incorporated, and is
      validly subsisting under the laws of its jurisdiction of incorporation,
      and each has the corporate capacity to carry on its business as it is
      presently and proposed to be carried on and is duly registered to carry on
      business and is in good standing in each jurisdiction in which the
      character of its properties or the nature of its business makes such
      registration necessary, and has all requisite power and authority to carry
      on its business as it is currently and is proposed to be carried and to
      own, lease and operate its properties and
assets;

- 11 -

	 	(f) 	
      the Corporation has conducted and is conducting its
      business in compliance in all material respects with all applicable laws,
      rules and regulations and is duly licensed, registered or qualified to
      carry on its business as currently conducted, except to the extent that
      the failure to so comply or to be so licensed, registered or qualified
      would not have a material adverse effect on the Corporation, and all such
      licenses, registrations or qualifications which are material are valid and
      existing in good standing, and the Corporation is not aware of any
      legislation, regulation, rule or lawful requirements presently in force or
      proposed to be brought into force under which the Corporation anticipates
      it will be unable to comply with without materially adversely affecting
      the Corporation;

	 	 	 
	 	(g) 	
      there has not been any material change in the capital,
      assets, liabilities or obligations (absolute, accrued, contingent or
      otherwise) of the Corporation from the position set forth in the Financial
      Statements that have not otherwise been disclosed in the Public Record and
      there has not been any material adverse change in the business, operations
      or condition (financial or otherwise) or results of the operations of the
      Corporation since March 31, 2011 that has not otherwise been disclosed in
      the Public Record, and there are no material facts, transactions, events
      or occurrences which could have a materially adverse impact on such
      capital, assets, liabilities, obligations, business, operations, condition
      or prospects of the Corporation of which the Corporation is aware which
      have not been generally disclosed in the Public Record;

	 	 	 
	 	(h) 	
      the Financial Statements, prepared in accordance with
      United States generally accepted accounting principles applied on a
      consistent basis and together with the certification of the Corporation’s
      annual filings for June 30, 2009 and June 30, 2010 fairly represent the
      financial position and condition of the Corporation (taken as a whole) as
      at the dates thereof and reflect all material liabilities (absolute,
      accrued, contingent or otherwise) of the Corporation as at the dates
      thereof and the Corporation has no additional material liabilities which
      are not set forth in the Financial Statements and the assets of the
      Corporation are as set forth in the Public Record;

	 	 	 
	 	(i) 	
      the auditors of the Corporation who audited the Financial
      Statements of the Corporation are independent public accountants as
      required by Applicable Securities Laws;

	 	 	 
	 	(j) 	
      there has not been any “reportable event” (within
      the meaning of National Instrument 51-102 – Continuous Disclosure
      Obligations) with respect to the present or any former auditor of the
      Corporation;

	 	 	 
	 	(k) 	
      there are no actions, suits, proceedings or inquiries
      pending or, to the knowledge of the Corporation threatened against or
      affecting the Corporation, at law or in equity or before or by any
      federal, provincial, municipal or other governmental department,
      commission, board, bureau or agency which may in any way materially
      adversely affect the business, operations or condition (financial or
      otherwise) of the Corporation which may affect the distribution of the
      Securities,

- 12 -

the Agent’s Compensation Options or
the securities comprised therein or which would impair the ability of the
Corporation to consummate the transactions contemplated hereby or to duly
observe and perform any of its covenants or obligations contained herein or in
the Subscription Agreements and the Corporation is not aware of any existing
ground on which such action, suit, proceeding or inquiry might be commenced with
any reasonable likelihood of success; 

	 	(l) 	
      the Corporation is not in breach or violation of or
      default under (and no event has occurred and is continuing which with the
      giving of notice or lapse of time or both would constitute an event of
      default under) any of its respective Material Contracts;

	 	 	 
	 	(m) 	
      neither the execution and delivery by the Corporation of
      any of the Transaction Agreements, nor the consummation of the
      transactions contemplated thereby, nor the due observance and performance
      by the Corporation of any of its covenants or obligations contained
      therein conflicts or will conflict with, results or will result in a
      breach or violation of, or constitutes or will constitute a default (or
      any event which with the giving of notice or lapse of time or both would
      constitute an event of default) under any of the terms or provisions of
      the constating documents or by-laws of the Corporation or of any
      resolutions of the directors or shareholders of the Corporation, or of any
      of the terms or provisions of any material mortgage, note, indenture,
      contract, agreement (written or oral), instrument, lease or other document
      to which the Corporation is a party or by which the Corporation is bound
      or to which any of its respective properties or assets are subject or of
      any judgment, decree, order, law, rule or regulation by which the
      Corporation is bound or to which any of its properties or assets is
      subject, the effect of any of which breaches, violates, conflicts or
      defaults, singularly or in the aggregate, might materially adversely
      affect the business, operations or condition (financial or otherwise) of
      the Corporation or would impair the ability of the Corporation to
      consummate the transactions contemplated hereby or to duly observe and
      perform any of its covenants or obligations contained in the Transaction
      Agreements;

	 	 	 
	 	(n) 	
      the information and statements set forth in the Public
      Record were true, correct and complete in all material respects and did
      not contain any misrepresentation, as of the date of such information or
      statement, and were prepared in accordance with and complied with
      Applicable Securities Laws, the U.S. Securities Act and the U.S. Exchange
      Act and the Corporation has not filed any confidential material change
      reports still maintained on a confidential basis;

	 	 	 
	 	(o) 	
      except as disclosed in the Public Record or in writing to
      the Agent, the Corporation does not owe any amount to, nor has the
      Corporation any present loans to, or borrowed any amount from or is
      otherwise indebted to, any officer, director, employee or securityholder
      of either of them or any person not dealing at “arm’s length” (as
      such term is defined in the Income Tax Act (Canada) with any of them
      except for usual employee reimbursements and compensation paid in the
      ordinary and normal course of the business of the
  Corporation;

- 13 -

	 	(p) 	
      except usual employee or consulting arrangements made in
      the ordinary and normal course of business, the Corporation is not a party
      to any contract, agreement or understanding with any officer, director,
      employee or securityholder thereof or any other person not dealing at
      arm’s length with the Corporation;

	 	 	 
	 	(q) 	
      no officer, director or employee of the Corporation and
      no person which is an affiliate or associate of any of the foregoing
      persons, owns, directly or indirectly, any interest (except for shares
      representing less the 5% of the outstanding shares of any class or series
      of any publicly traded company) in, or is an officer, director, employee
      or consultant of, any person which is, or is engaged in, a business
      competitive with the business of the Corporation which could materially
      adversely impact on the ability to properly perform the services to be
      performed by such person for the Corporation;

	 	 	 
	 	(r) 	
      no officer, director, employee or securityholder of the
      Corporation has any cause of action or other claim whatsoever against, or
      owes any amount to, the Corporation except for claims in the ordinary and
      normal course of the business of the Corporation such as for accrued
      vacation pay or other amounts or matters which would not be material to
      the Corporation;

	 	 	 
	 	(s) 	
      the Corporation is not aware of any licensing or
      legislation, regulation, by-law or other lawful requirement of any
      governmental body having lawful jurisdiction over the Corporation that the
      Corporation is not in compliance with, which would reasonably be likely to
      have a material adverse affect on the Corporation or its
  business;

	 	 	 
	 	(t) 	
      the authorized capital of the Corporation consists of
      131,666,666 Common Shares and 100,000,000 Preferred Shares, of which as of
      the date of this Agreement, 65,277,818 Common Shares were issued and
      outstanding as fully paid and non- assessable shares and 500,000 Preferred
      Shares were issued and outstanding as fully paid and non-assessable
      shares, and, except with respect to Common Shares and Preferred Shares
      reserved for issuance as detailed on Schedule “B” hereto, as at the date
      of this Agreement no person has any right, agreement or option, present or
      future, contingent or absolute, or any right capable of becoming a right,
      agreement or option, for the issue or allotment of any unissued shares in
      the capital of the Corporation or any other security convertible into or
      exchangeable or exercisable for any such shares or to require the
      Corporation to purchase, redeem or otherwise acquire any of the issued and
      outstanding Common Shares or Preferred Shares;

	 	 	 
	 	(u) 	
      the Corporation has full corporate power and authority to
      enter into the Transaction Agreements and to perform its obligations set
      out therein, and the Transaction Agreements will on the Closing Date be
      duly authorized, executed and delivered by the Corporation, and the
      Transaction Agreements will be, at the Closing Time and thereafter, legal,
      valid and binding obligations of the Corporation and enforceable against
      the Corporation in accordance with their respective terms, subject to the
      general qualifications that:

- 14 -

	 	(i) 	
      enforceability may be limited by bankruptcy, insolvency
      or other laws affecting creditors’ rights generally,

	 	 	 
	 	(ii) 	
      equitable remedies, including the remedies of specific
      performance and injunctive relief, are available only in the discretion of
      the applicable court and the courts have statutory and inherent powers to
      stay proceedings before them,

	 	 	 
	 	(iii) 	
      rights to indemnity and contribution hereunder may be
      limited under applicable law or court order, and

	 	 	 
	 	(iv) 	
      laws regarding limitations of actions
  apply;

	 	(v) 	
      no order which is currently outstanding has been issued
      by the SEC or any Securities Commission, stock exchange, governmental
      agency, regulatory body or any similar regulatory authority preventing or
      suspending trading in any securities of the Corporation; no such
      proceeding is, to the knowledge of the Corporation; pending, contemplated
      or threatened; and the Corporation is not in default of any requirement of
      Applicable Business Laws, Applicable Securities Laws, the U.S. Securities
      Act or the U.S. Exchange Act which would have a material effect on the
      Offering or the Corporation;

	 	 	 
	 	(w) 	
      the Corporation has taken or will take prior to the
      Closing Date all such steps as may be necessary to comply with the
      requirements of Applicable Securities Laws, and the U.S. Securities Act
      such that the Securities may, in accordance with Applicable Securities
      Laws and the U.S. Securities Act, be offered for sale and sold on a
      private placement basis to the public in the Offering Jurisdictions
      through the Agent or any member of the Selling complying with applicable
      securities laws by way of the exemptions from the prospectus requirements
      in the Offering Jurisdictions;

	 	 	 
	 	(x) 	
      the Transfer Agent at its principal office in Las Vegas,
      Nevada is the duly appointed registrar and transfer agent for the Common
      Shares;

	 	 	 
	 	(y) 	
      the issued and outstanding Common Shares are quoted for
      trading on the Over the Counter Bulletin Board in the U.S. and the
      Corporation is in material compliance with the by-laws, rules and
      regulations thereof and the applicable securities laws of the SEC and the
      BCSC;

	 	 	 
	 	(z) 	
      the Corporation has taken or will take prior to the
      Closing Date all such steps as may be necessary to obtain the final
      approval to list the Common Shares on the Recognized Exchange and to issue
      the Common Shares comprised within the Securities and the Agent’s
      Compensation Options, subject only to the filing of certain documents and
      the payment of additional listing fees;

	 	 	 
	 	(aa) 	
      the Corporation is an “OTC reporting issuer” in
      Bristish Columbia within the meaning of BCI 51-509 and is not in default
      of any requirement in relation thereto, and is an “electronic filer”
      under National Instrument 13-101 (SEDAR);

- 15 -

	 	(bb) 	
      the definitive form of certificate for the Common Shares
      has been duly approved by the directors of the Corporation, is in due and
      proper form under the laws governing the Corporation and complies with the
      requirements of the Recognized Exchange;

	 	 	 	 	 
	 	(cc) 	
      the books of account and other records of the
      Corporation, whether of a financial or accounting nature or otherwise,
      have been maintained in accordance with prudent business
  practices;

	 	 	 	 	 
	 	(dd) 	
      except to the extent that any violation or other matter
      referred to in this subparagraph does not have a material adverse effect
      on the business, financial condition, assets, properties, liabilities or
      operations of the Corporation:

	 	 	 	 	 
	 		(i) 	
      the Corporation is not in violation of, and has operated
      its business at all times in compliance with, all applicable federal,
      provincial, state, municipal or local laws, regulations, orders,
      government decrees or ordinances having force of law on the relevant date
      with respect to environmental, health or safety matters in those
      jurisdictions wherein the Corporation conducts business (collectively,
      “Environmental Laws”),

	 	 	 	 	 
	 		(ii) 	
      no orders, directions or notices have been issued, and
      none remain outstanding pursuant to any Environmental Laws relating to the
      business or assets of the Corporation,

	 	 	 	 	 
	 		(iii) 	
      the Corporation has not failed to report to the proper
      federal, provincial, municipal or other political subdivision, government,
      department, commission, board, bureau, agency or instrumentality, domestic
      or foreign (“Government Authority”) the occurrence of any event
      which is required to be so reported by any Environmental Law,

	 	 	 	 	 
	 		(iv) 	
      the Corporation holds all licenses, permits and approvals
      required under any Environmental Laws in connection with the operation of
      its business and the ownership and use of its assets and all such
      licenses, permits and approvals are in full force and effect except
      for:

	 	 	 	 	 
	 			(a) 	
      notifications and conditions of general application to
      assets of the type owned by the Corporation, and

	 	 	 	 	 
	 			(b) 	
      notifications relating to reclamation obligations under
      applicable law, and

	 	 	 	 	 
	 		(v) 	
      the Corporation has not received any notification
      pursuant to any Environmental Laws that any work, repairs, constructions
      or capital expenditures are required to be made by any of them as a
      condition of continued compliance with any Environmental Laws or any
      licence, permit or approval issued pursuant thereto, or that any licence,
      permit or approval referred to above is about to be reviewed, made subject
      to limitation or conditions, revoked, withdrawn or
  terminated;

- 16 -

	 	(ee) 	
      with such exceptions as are not material to the
      Corporation, the Corporation has duly and on a timely basis filed all tax
      returns required to be filed by it, has paid all taxes due and payable by
      it and has paid all assessments and re-assessments and all other taxes,
      governmental charges, penalties, interest and other fines due and payable
      by it and which are claimed by any Government Authority to be due and
      owing and adequate provision has been made for taxes payable for any
      completed fiscal period for which tax returns are not yet required and
      there are no agreements, waivers, or other arrangements providing for an
      extension of time with respect to the filing of any tax return or payment
      of any tax, governmental charge or deficiency by the Corporation and there
      are no actions, suits, proceedings, investigations or claims threatened or
      pending against the Corporation in respect of taxes, governmental charges
      or assessments or any matters under discussion with any government
      authority relating to taxes, governmental charges or assessments asserted
      by any such authority;

	 	 	 
	 	(ff) 	
      notwithstanding the rights of first refusal granted
      herein, the Corporation has not granted any other rights of first refusal
      with respect to any equity (or securities convertible into equity)
      financing, which rights of first refusal are existing and will be in
      effect as at the date of Closing of the Offering;

	 	 	 
	 	(gg) 	
      except for the Agent and any Selling Group member engaged
      by the Agent, there is no other person, firm or corporation acting or
      purporting to act at the request of the Corporation who is entitled to any
      compensation or any finder’s, underwriter’s or agency fee in connection
      with the transactions contemplated hereby;

	 	 	 
	 	(hh) 	
      other than the Recognized Exchange, no authorization,
      approval or consent of any court or government authority or agency is
      required to be obtained by the Corporation in connection with the sale and
      delivery of the Securities or the Agent’s Compensation Options except as
      contemplated hereby;

	 	 	 
	 	(ii) 	
      the minute books for the Corporation contain full, true
      and correct copies of the constating documents of the Corporation, and
      contain copies of all minutes of all meetings and all consent resolutions
      of the directors, committees of directors and shareholders of the
      Corporation, and all such meetings were duly called and properly held and
      all consent resolutions were properly adopted;

	 	 	 
	 	(jj) 	
      the Corporation is in compliance with its continuous
      disclosure obligations under Applicable Securities Laws and the U.S.
      Exchange Act;

	 	 	 
	 	(kk) 	
      except as qualified by the Public Record, the Corporation
      represents, warrants and confirms that (i) the Corporation is the
      beneficial owner of its properties, business and assets or has the right
      to acquire interests in such properties, business or assets, (ii) all
      agreements by which the Corporation holds an interest in a property,
      business or assets are in good standing in all material respects according
      to their terms and (iii) the properties of the Corporation are in good
      standing in all material respects under the applicable laws of the
      jurisdictions in which they are situated;

- 17 -

	 	(ll) 	
      there are no judgments against the Corporations, which
      are unsatisfied, nor are there any consent decrees or injunctions to which
      the Corporation is subject;

	 	 	 
	 	(mm) 	
      the Corporation will not have taken and will not take any
      action which would reasonably be expected to result in the Recognized
      Exchange refusing to list the Common Shares on the Recognized
    Exchange;

	 	 	 
	 	(nn) 	
      the Corporation is not an “investment company”
      within the meaning of the Investment Company Act of 1940 (United
      States), as amended;

	 	 	 
	 	(oo) 	
      the Corporation is reporting under section 13(a) or 15(d)
      of the U.S. Exchange Act and is not in default in any material respects or
      any of the requirements of the U.S. Exchange Act;

	 	 	 
	 	(pp) 	
      neither the Corporation, nor any person acting on its
      behalf has: (i) made or will make any “directed selling efforts”
      (as such term is defined in Regulation S of the U.S. Securities Act)
      in the United States; or (ii) engaged in or will engage in any form of
      “general solicitation” or “general advertising” (as such
      terms are defined in Rule 502(c) under regulation D of the U.S. Securities
      Act) in the United States with respect to offers or sales of the
      Securities.

	 	 	 
	 	(qq) 	
      the Corporation represents, warrants, covenants and
      agrees that its representations and warranties set forth in the
      Subscription Agreements are true and correct and that the Corporation will
      fully comply with the covenants and agreements of the Corporation set
      forth therein; and

	 	 	 
	 	(rr) 	
      the Corporation, following acceptance of a Subscription
      Agreement, confirms that such acceptance constitutes a legal and binding
      obligation of the Corporation, enforceable against it subject to
      subsection 5.1(u).

	5.2 	
      The Agent represents and warrants to the Corporation, and
      acknowledges that the Corporation is relying upon such representations and
      warranties, that:

	 	 	 
		(a) 	
      the Agent is a valid and subsisting corporation under the
      law of the jurisdiction in which it was incorporated, being Canada, and
      has good and sufficient power and authority to enter into this Agreement
      and complete the transactions under this Agreement on the terms and
      conditions set forth herein;

	 	 	 
		(b) 	
      the Agent and each Selling Group member is a dealer
      properly registered under Applicable Securities Laws in the Designated
      Provinces;

	 	 	 
		(c) 	
      the Agent is a member in good standing of the Recognized
      Exchange;

	 	 	 
		(d) 	
      neither the Agent nor any Selling Group member has made
      any representation or warranty on behalf of the Corporation;

	 	 	 
		(e) 	
      neither the Agent and the Selling Group have not
      solicited offers to purchase or sell the Securities so as to require the
      registration of, or filing of a prospectus,

- 18 - 

offering memorandum or similar
disclosure document with respect to the Securities under Applicable Securities
Laws;

	 	(f) 	
      the Agent and the Selling Group only offered or sold the
      Securities in the Offering Jurisdictions and only to those persons that
      are qualified to purchase the Securities under exemptions as set out in
      applicable securities laws;

	 	 	 	 
	 	(g) 	
      the Agent and the Selling Group refrained from providing
      to prospective purchasers an offering memorandum within the meaning of
      Applicable Securities Laws, or any other document purported to describe
      the business and affairs of the Corporation, and from advertising the
      Offering in (i) printed media of general and regular circulation; (ii)
      radio; (iii) television; (iv) telecommunication (including electronic
      display); or (v) on any green sheet or other internal marketing document
      without the consent of the Corporation;

	 	 	 	 
	 	(h) 	
      the Agent and any member of the Selling Group will be
      acquiring the non- transferable Agent’s Compensation Options as principal
      for their own account and are qualified to acquire the Agent’s
      Compensation Options under the applicable exemptions set out in NI
      45-106.

	 	 	 	 
	 	(i) 	
      the Agent, nor any member of the Selling Group, nor any
      persons acting on behalf of any of the foregoing has:

	 	 	 	 
	 		(i) 	
      made or will make any “directed selling efforts”
      (as such term is defined in Regulation S of the U.S. Securities Act)
      in the United States with respect to offers or sales of the
    Securities,

	 	 	 	 
	 		(ii) 	
      engaged in or will in engage in any form of “general
      solicitation” or “general advertising” (as such terms are
      defined in Rule 502(c) under Regulation D of the U.S. Securities Act) in
      the United States with respect to offers or sales of the Securities,
      and

	 	 	 	 
	 		(iii) 	
      made or will make any offer to sell, any solicitation of
      an offer to buy, or any sale of any of the Securities to any person in the
      United States or to, or for the account or benefit of, any U.S. Person;
      and

	 	 	 	 
	 	(j) 	
      the Agent and each member of the Selling Group: (i) is
      not a person in the United States or a U.S. Person; (ii) is not acquiring
      the Agent’s Compensation Options, the Agent’s Unit Shares, the Agent’s
      Warrants or the Agent’s Warrant Shares for the account or benefit of any
      person in the United States or any U.S. Person; (iii) does not have any
      present intention of distributing any such securities into the United
      States or to, or for the account or benefit of, any person in the United
      States or any U.S. Person; (iv) will not offer, sell, pledge or transfer,
      directly or indirectly, any such securities into the United States or to,
      or for the account or benefit of, any person in the United States or any
      U.S. Person, except pursuant to an effective registration statement under
      the U.S. Securities Act, or pursuant to an exemption from the registration
      requirements of the U.S. Securities Act, and in either case in compliance
      with any applicable state securities laws, and (iv)
will

- 19 -

not engage in any hedging transactions
in relation to such securities, unless such transactions are conducted in
compliance with the U.S. Securities Act. 

ARTICLE 6 

  CORPORATION’S COVENANTS

	6.1 	
      The Corporation hereby covenants to and with the Agent
      and the Subscribers and acknowledges that the Agent and the Subscribers
      are relying upon such covenants, as follows:

	 	 	 	 
		(a) 	
      the Corporation will use its best efforts to fulfill or
      cause to be fulfilled, at or prior to the Closing Time, each of the
      conditions set out in Article 8;

	 	 	 	 
		(b) 	
      the Corporation will ensure that at all times a
      sufficient number of Common Shares are reserved:

	 	 	 	 
			(i) 	
      for the issuance of the Unit Shares comprised within the
      Securities,

	 	 	 	 
			(ii) 	
      for the issuance of the Warrant Shares upon the due
      exercise of the Warrants comprised within the Securities,

	 	 	 	 
			(iii) 	
      for the issuance of the Agent’s Unit Shares upon the due
      exercise of the Agent’s Compensation Options and the Agent’s Warrant
      Shares upon due exercise of the Agent’s Warrants comprised within the
      Agent’s Compensation Options,

	 	 	 	 
			
      and the Corporation will make all necessary arrangements
      for the provisions of this clause to be effected;

	 	 	 	 
		(c) 	
      during the period commencing with the date hereof and
      ending on the conclusion of the distribution of the Unit Shares, Warrants
      and Warrant Shares comprised within the Securities and the Agent’s Unit
      Shares, Agent’s Warrants and Agent’s Warrant Shares comprised within the
      Agent’s Compensation Options the Corporation will use its commercially
      reasonable efforts to inform the Agent of:

	 	 	 	 
			(i) 	
      any request of the SEC or any Securities Commission for
      any amendment to the Public Record or for any additional information which
      may be material to the distribution of the Securities, the Agent’s
      Compensation Options or the securities comprised therein,

	 	 	 	 
			(ii) 	
      the issuance by the SEC or any Securities Commission,
      stock exchange or by any other competent authority of any order to cease
      or suspend trading of any securities of the Corporation, or of the
      institution or threat of institution of any proceedings for that purpose,
      or

	 	 	 	 
			(iii) 	
      the receipt by the Corporation of any communication from
      the SEC or any Securities Commission, stock exchange, governmental agency,
      regulatory

- 20 -

body or any other competent authority
relating to the Public Record or the offering of the Securities or the Agent’s
Compensation Options, 

and except as otherwise agreed by the
Agent and the Corporation will use its commercially reasonable efforts to
prevent the issuance of any such cease trading order or suspension order and, if
issued, to obtain the withdrawal thereof as soon as possible; 

	 	(d) 	
      during the period commencing on the date hereof and
      ending on the date which is six (6) months following the final Closing
      Date, the Corporation will use its commercially reasonable efforts to
      promptly provide to the Agent, upon the, filing or issuance thereof any
      listing application, prospectus, filing statement, information circular or
      registration statement issued by the Corporation with respect to the
      completion of a Liquidity Event;

	 	 	 	 
	 	(e) 	
      the Corporation shall not take any action that would
      prevent the Corporation and the Agent from relying on the exemptions from
      the prospectus requirements of Applicable Securities Laws, and the U.S.
      Securities Act as contemplated by the Subscription Agreements;

	 	 	 	 
	 	(f) 	
      the Corporation will comply with all covenants of the
      Corporation set forth in the Subscription Agreements and will perform all
      the obligations to be performed by it under this Agreement and the
      Subscription Agreements;

	 	 	 	 
	 	(g) 	
      the Corporation will allow the Agent and the Agent’s
      Counsel to participate fully in the preparation of the Subscription
      Agreement, Warrants, Agent’s Compensation Options and Agent’s Warrants and
      any listing application, prospectus, filing statement, information
      circular or similar document issued by the Corporation with respect to the
      completion of a Liquidity Event and the removal of any resale restrictions
      pursuant to BCI 51-509;

	 	 	 	 
	 	(h) 	
      from the date hereof until the final Closing Date, the
      Corporation will make available its senior management persons to meet with
      potential investors if so requested by the Agent;

	 	 	 	 
	 	(i) 	
      other than pursuant to the Unit Offering or Material
      Contracts which are in force on the date hereof, the Corporation will not,
      from the date hereof until that date that is six (6) months following the
      Liquidity Date, directly or indirectly, sell, or offer to sell, or
      announce the offering of, or enter into or make any agreement or
      understanding, or announce the making or entry into any agreement or
      understanding, to issue, sell or exchange any Common Shares of the
      Corporation or securities exchangeable or convertible into Common Shares
      of the Corporation without the prior written consent of the Agent, not to
      be unreasonably withheld, provided that notwithstanding the foregoing the
      Corporation may:

	 	 	 	 
	 		(i) 	
      grant stock options under the Corporation’s existing
      stock option plan if a plan is adopted prior to the date of the Liquidity
      Event,

- 21 -

	 	(ii) 	
      issue Common Shares of the Corporation to the holders of
      stock options, purchase warrants or other securities convertible into or
      exchangeable or exercisable for Common Shares of the Corporation that are
      outstanding on the date hereof or were granted as described under (i)
      herein, and are convertible, exercisable or exchangeable by their terms
      within such period,

	 	 	 
	 	(iii) 	
      issue Common Shares of the Corporation in connection with
      the acquisition of mineral properties or other assets in the ordinary
      course of business, and

	 	 	 
	 	(iv) 	
      issue Common Shares of the Corporation in connection with
      the entering into by the Corporation of any option agreements or joint
      venture agreements in respect of the Corporation’s mineral properties or
      other assets;

	 	(j) 	
      the Corporation will make all necessary arrangements for
      the issue (at the cost of the Corporation, other than any applicable
      transfer taxes) of the definitive certificates representing the Warrants
      comprised within the Securities and the Agent’s Compensation
    Options;

	 	 	 
	 	(k) 	
      the Corporation will take all such steps as are necessary
      to obtain final approval of the Recognized Exchange to issue the Common
      Shares comprised within the Securities and the Agent’s Compensation
      Option’s, subject only to the filing of certain documents and the payment
      of additional listing fees;

	 	 	 
	 	(l) 	
      on the Liquidity Date the Corporation will comply, in all
      material respects, with the applicable rules and regulations of the
      Recognized Exchange during the period commencing on the Liquidity Date and
      ending on the conclusion of the distribution of the Unit Shares, Warrants
      and Warrant Shares comprised within the Securities and the Agent’s Unit
      Shares, Agent’s Warrants and Agent’s Warrant Shares comprised within the
      Agent’s Compensation Options the Corporation will not take any action
      which would reasonably be expected to result in the delisting or
      suspension of the Common Shares on or from the Recognized
  Exchange;

	 	 	 
	 	(m) 	
      within 10 Business Days of the Liquidity Date the
      Corporation will fill with the BCSC the BC Form 51-509F4 - Notice
      advising the BCSC that the Corporation is no longer an OTC reporting
      issuer under BCI 51-509 and that the Corporation shall forward to the
      Agent a copy of any BCSC letter of acceptance acknowledging that the
      Corporation is no longer an OTC reporting issuer within five (5) Business
      Days of receipt of any such letter;

	 	 	 
	 	(n) 	
      the Corporation will promptly notify the Agent in writing
      if, prior to the final Closing Date, there shall occur any material change
      or change in a material fact (in either case, whether actual, anticipated,
      contemplated or threatened and other than a material change or change in a
      material fact relating solely to the Agent) or

- 22 -

any event or development involving a
prospective material change or a change in a material fact in any or all of the
business, affairs, operations, assets (including information or data relating to
the estimated value or book value of assets), liabilities (contingent or
otherwise), financial position, capital, ownership, control or management of the
Corporation or any other change which is of such a nature as to result in, or
could result in, a misrepresentation in the Public Record or could render any of
the foregoing not in compliance with any of the Applicable Business Laws, the
Applicable Securities Laws, the U.S. Securities Act or the U.S. Exchange Act, or
the discovery by the Corporation of any misrepresentation in any part of the
Public Record; 

	 	(o) 	
      in respect of any such actual, anticipated, contemplated,
      threatened or prospective change referred to in subsection 6.1(n) that
      occurs prior to the final Closing Date, the Corporation will, to the
      reasonable satisfaction of the Agent, issue or file, as applicable,
      promptly and, in any event, within all applicable time limitation periods
      with the SEC, Securities Commissions, stock exchange, governmental agency,
      regulatory body or any other competent authority with jurisdiction, in the
      case of a material adverse change, a press release and material change
      report as may be required under the Applicable Securities Laws, the U.S.
      Securities Act or the U.S. Exchange Act, and shall comply with all other
      applicable filing and other requirements under the Applicable Securities
      Laws, the U.S. Securities Act and the U.S. Exchange Act,: and the
      Corporation shall not file any such new or amended disclosure
      documentation without first obtaining the approval of the form and content
      thereof by the Agent, which approval shall be promptly considered and not
      unreasonably withheld, and shall not issue or file, as applicable, any
      such press release or material change report without giving the Agent a
      reasonable opportunity for review of the proposed forms;

	 	 	 
	 	(p) 	
      the Corporation will in good faith discuss with the Agent
      as promptly as possible any circumstance or event which is of such nature
      that there is or ought to be consideration given as to whether there may
      be a material change or change in a material fact as described in
      subsection 6.1(n) or subsection 6.1(o) that occur prior to the final
      Closing Date;

	 	 	 
	 	(q) 	
      the Corporation shall use the proceeds of the Brokered
      Offering, the Optioned Securities and the Agent’s Compensation Options to
      pay the expenses of the Brokered Offering, to cover the exploration and
      the development of the Corporation’s mining project in Nevada and for
      general working capital; and

	 	 	 
	 	(r) 	
      on Closing, the Corporation will issue the Agent’s
      Compensation Options to the Agent or to a Selling Group member as
      otherwise directed by the Agent.

ARTICLE 7

  CLOSING 

	7.1 	
      The sale of the Securities shall be completed at the
      Closing Time at the offices of O'Neill Law Corporation, counsel to the
      Corporation, in Vancouver, British Columbia or at
such

- 23 -

other place as the Corporation and the
Agent may agree. Subject to the satisfaction of the conditions set forth in
Article 8, the Agent, on or before the Closing Date, as applicable, shall
deliver to the Corporation: 

	 	(a) 	
      all completed Subscription Agreements (including any
      applicable documents specifically referred to in the Subscription
      Agreements);

	 	 	 
	 	(b) 	
      a summary of the names, addresses and number and type of
      Securities subscribed for by each Subscriber at such Closing, as set out
      in section 8.4; and

	 	 	 
	 	(c) 	
      a certified cheque, bank draft or money order payable to
      the Corporation at par in an amount equal to the aggregate of all
      subscriptions for Securities delivered to and accepted by the Corporation,
      net of the Agent’s fees and expenses as set out in Article 9
  herein,

against delivery by the Corporation of
the certificates referred to in subsection 8.1(j) together with such other
documents as may be required pursuant to section 8.1 herein. 

The Corporation may not reject any properly completed
Subscription Agreement which is in compliance with Applicable Securities Laws
unless: (i) the Subscription Funds for the Securities subscribed for pursuant to
all Subscription Agreements tendered by the Agent exceeds the Maximum
Subscription, in which case Subscription Agreements representing the
over-subscription may, after consultation with the Agent, be rejected, or (ii)
if a Subscription Agreement or Subscription Agreements creates a new insider or
control person as such terms are defined by Applicable Securities Laws, the U.S.
Securities Act or the U.S. Exchange Act and the rules and regulations
promulgated thereunder. 

ARTICLE 8 

  CONDITIONS OF CLOSING

	8.1 	
      The obligations of the Agent hereunder shall be
      conditional upon the Agent receiving, and the Agent shall have the right
      on the Closing Date on behalf of Subscribers to withdraw all subscriptions
      delivered and not previously withdrawn by Subscribers unless the Agent
      receives, on the Closing Date:

	 	 	 
		(a) 	
      a copy of the final Listing Application filed by the
      Corporation with the Recognized Exchange;

	 	 	 
		(b) 	
      a copy of the letter(s) from the Recognized Exchange
      giving final approval of: (i) the Listing Application and (ii) the
      issuance of the Securities and the Agent’s Compensation Options and the
      securities comprised therein;

	 	 	 
		(c) 	
      a legal opinion of the Corporation’s Counsel addressed to
      the Agent and the Agent’s Counsel, in form and substance satisfactory to
      the Agent, with respect to such matters as the Agent may reasonably
      request relating to the Brokered Offering, including, without
      limitation:

	 	(i) 	
      the Corporation is validly existing and in good
      standing,

- 24 -

	 	(ii) 	
      the corporate power and capacity of the
    Corporation,

	 	 	 
	 	(iii) 	
      the authorized, issued and outstanding Common Shares of
      the Corporation,

	 	 	 
	 	(iv) 	
      the Unit Shares issued to the Subscribers pursuant to the
      Brokered Offering and the Over-Allotment Option, as applicable, have been
      validly authorized and issued,

	 	 	 
	 	(v) 	
      the Warrants issued to the Subscribers pursuant to the
      Brokered Offering and the Over-Allotment Option, as applicable, and the
      Agent’s Compensation Options issued to the Agent’s or members of the
      Selling Group, respectively, have been validly authorized and constitute
      legal, valid and binding obligations of the Corporation in accordance with
      their terms, and that the Agent’s Warrants, when issued upon the due
      exercise of the Agent’s Compensation Options in accordance with their
      terms, will be validly authorized and will constitute legal, valid and
      binding obligations of the Corporation in accordance with their
    terms,

	 	 	 
	 	(vi) 	
      the Warrant Shares, the Agent’s Unit Shares and the
      Agent’s Warrant Shares, have been validly authorized and, when issued upon
      the due exercise of the Warrants, the Agent’s Compensation Options or the
      Agent’s Warrants, respectively and each in accordance with their terms,
      will be validly issued,

	 	 	 
	 	(vii) 	
      the due and proper appointment of the Transfer
    Agent,

	 	 	 
	 	(viii) 	
      the due authorization, execution and delivery and the
      enforceability of the Transaction Agreements,

	 	 	 
	 	(ix) 	
      that the sale and delivery of the Securities, the Agent’s
      Compensation Options and the securities comprised therein do not and will
      not result in a breach of, and does not and will not create a set of facts
      which, after notice or lapse of time or both, conflict with any terms,
      conditions or provisions of the articles of the Corporation, the by-laws
      or any resolutions of the directors or shareholders of the
    Corporation,

	 	 	 
	 	(x) 	
      the Corporation being a reporting issuer in the Province
      of Bristish Columbia and not in default under applicable securities laws
      of British Columbia,

	 	 	 
	 	(xi) 	
      the Corporation is a company subject to section 13(a) of
      the U.S. Exchange Act,

	 	 	 
	 	(xii) 	
      the distribution of the Securities, the Agent’s
      Compensation Options and the securities comprised therein being compliant
      with the requirements of Applicable Securities Laws and the U.S.
      Securities Act as applicable,

- 25 - 

	 	(xiii) 	
      with respect to the first trades under Applicable
      Securities Laws in the Unit Shares, Warrants and Warrant Shares comprised
      within the Securities and the Agent’s Unit Shares, Agent’s Warrants and
      the Agent’s Warrant Shares comprised within the Agent’s Compensation
      Options, and

	 	 	 
	 	(xiv) 	
      the Recognized Exchange has conditionally accepted for
      trading the Common Shares and the Common Shares comprised within the
      Securities and Agent’s Compensation Options having been approved for
      trading on the Recognized Exchange;

It is understood that the Corporation’s Counsel may arrange for
the opinions of local counsel acceptable to the Corporation’s Counsel as to
matters governed by the laws of Canadian jurisdictions other than British
Columbia and opinions of local counsel acceptable to the Corporation’s Counsel
as to matters governed by the laws of American jurisdictions and on certificates
of officers of the Corporation, Government Authorities and the Transfer Agent as
to relevant matters of fact. It is further understood that certain of the
opinions which are not matters of Canadian law may be opined upon directly by
local counsel and that the Corporation’s Counsel shall be required to also
tender such opinions. It is further understood that the Agent’s Counsel may rely
on the opinion of the Corporation’s Counsel as to matters which specifically
relate to the Corporation. 

	 	(d) 	
      a legal title opinion of the Corporation’s Counsel, or
      such other counsel as the Agent and the Corporation may agree, addressed
      to the Corporation, in form and substance satisfactory to the Agent, with
      respect to the Corporation’s registered ownership, right, title, or
      interest in the Corporation’s mining properties or mining claims or mining
      leases in the State of Nevada in the United States of America and with
      respect to the status of any mining properties or mining claims or mining
      leases in the State of Nevada in the United States of America under option
      in favour of the Corporation (which the Agent acknowledges it has received
      as of the date of this Agreement);

It is understood that the Corporation’s Counsel may arrange for
the title opinions of local counsel acceptable to the Corporation’s Counsel as
to matters governed by the laws of Canadian jurisdictions other than British
Columbia and for title opinions of local counsel acceptable to the Corporation’s
Counsel as to matters governed by the laws of American jurisdictions and on
certificates of officers of the Corporation and Government Authorities as to
relevant matters of fact. It is further understood that certain of the title
opinions which are not matters of Canadian law may be opined upon directly by
local counsel and that the Corporation’s Counsel shall be required to also
tender such title opinions. It is further understood that the Agent’s Counsel
may rely on the opinion of the Corporation’s Counsel as to matters which
specifically relate to the Corporation. 

	 	(e) 	
      a “bring down” certificate of the Corporation dated the
      Closing Date, addressed to the Agent and signed on the Corporation’s
      behalf by the President of the Corporation, or such other officer of the
      Corporation acceptable to the Agent, certifying
that:

- 26 -

	 	(i) 	
      the Corporation has complied with and satisfied all
      covenants, terms and conditions of this Agreement on its part to be
      complied with and satisfied at or prior to the Closing Time, other than
      those which have been waived by the Agent,

	 	 	 
	 	(ii) 	
      the representations and warranties of the Corporation set
      forth in this Agreement and, where applicable, in the Subscription
      Agreements are true and correct at the Closing Time, as if made at such
      time,

	 	 	 
	 	(iii) 	
      no event of the nature referred to in subsection 13.2(a)
      or, to the knowledge of the Corporation, subsection 13.2(b) has occurred
      or to the knowledge of such officer of the Corporation is pending,
      contemplated or threatened,

	 	 	 
	 	(iv) 	
      the Corporation being in compliance with all Applicable
      Business Laws;

	 	 	 
	 	(v) 	
      the Corporation has made and obtained, on or prior to the
      Closing Time, all necessary filing, approvals, consents and acceptances of
      applicable regulatory authorities and under any applicable agreement or
      document to which the Corporation is a party or by which it is bound in
      respect of the execution and delivery of this Agreement, the Brokered
      Offering and sale and distribution of the Securities, the Agent’s
      Compensation Options and the securities comprised therein and the
      consummation of the other transactions contemplated hereby,

	 	 	 
	 	(vi) 	
      the Corporation is the absolute legal and beneficial
      owner of, and has good and marketable title to, all of the material
      property or assets thereof as described in the Public Record, free of all
      mortgages, liens, charges, pledges, security interests, encumbrances,
      claims or demands whatsoever, other than those described in the Public
      Record or in the legal title opinion referred to in section 8.1(d) and no
      other property rights are necessary for the conduct of the business of the
      Corporation as currently conducted or contemplated to be
  conducted;

	 	 	 
	 	(vii) 	
      the Corporation does not know of any claim or the basis
      for any claim that might or could adversely affect the right thereof to
      use, transfer or otherwise exploit such property rights except as
      disclosed in the Public Record;

	 	 	 
	 	(viii) 	
      the Corporation does not have any responsibility or
      obligation to pay any commission, royalty, licence fee or similar payment
      to any person with respect to the property rights thereof other than as
      set out in the Public Record; and

	 	 	 
	 	(ix) 	
      such other matters as may be reasonably requested by the
      Agent or Agent’s Counsel;

- 27 -

	 	(f) 	
      a certified extract of a resolution of the directors of
      the Corporation authorizing the acceptance of the subscriptions for the
      Securities and the issuance of the certificates evidencing the securities
      comprised therein;

	 	 	 
	 	(g) 	
      evidence satisfactory to the Agent that the Corporation
      has obtained all necessary approvals of the Recognized Exchange for the
      listing of the Unit Shares and the Warrant Shares subject only to the
      filing of any documents and payment of any fees which may be required by
      the Recognized Exchange with respect to the Brokered Offering;

	 	 	 
	 	(h) 	
      copies of the Subscription Agreements executed by the
      Corporation;

	 	 	 
	 	(i) 	
      the fees and expenses provided for in Article
9;

	 	 	 
	 	(j) 	
      definitive certificates representing the Common Shares,
      the Warrants and the Agent’s Compensation Options in form and substance
      satisfactory to the Agent; and

	 	 	 
	 	(k) 	
      the Agent shall have received such other instruments and
      closing documents as it may reasonably
require.

	8.2 	
      The obligations of the Agent hereunder shall be
      conditional upon the Agent having completed its due diligence review of
      the Corporation and the results shall have been satisfactory to the Agent
      and the Agent shall have the right on the Closing Date on behalf of the
      Subscribers to withdraw all subscriptions delivered and not previously
      withdrawn by Subscribers should the Agent, in its sole discretion not be
      satisfied with its due diligence review.

	 	 
	8.3 	
      The parties acknowledge that there is no minimum number
      of Securities that must be subscribed for under the Brokered Offering and
      that Closings may occur on one or more dates as mutually agreed to by the
      Agent and the Corporation and that the Corporation shall deliver to the
      Agent the documents referred to in this Article 8, updated as of each
      Closing Date, and that the Agent shall deliver the applicable Subscription
      Funds to the Corporation on each Closing Date, net of fees and expenses
      retained by the Agent in accordance with the provisions of Article 9
      herein.

	 	 
	8.4 	
      The Agent shall provide the Corporation with a summary of
      the names and addresses of, and number and type of Securities subscribed
      for by, each Subscriber at such Closing, and the Corporation shall
      prepare, in consultation with the Agent, and subsequently file in
      accordance with Applicable Securities Laws all required documents or
      reports and pay all prescribed filing fees in relation thereto, within the
      time limits prescribed for making such filings and undertake any other
      action as may be reasonable or necessary in the circumstances to qualify
      the distribution of the Securities, the Agent’s Compensation Options and
      the securities comprised therein issued under available exemptions from
      the registration and prospectus requirements of the U.S. Securities Act,
      and the applicable securities laws in the Offering Jurisdictions where
      such Securities were sold and the Corporation shall provide the Agent with
      copies of all such filings.

- 28 - 

ARTICLE 9 
FEES AND EXPENSES

	9.1 	
      In consideration for the Agent’s services hereunder the
      Corporation has agreed:

	 	 	 
		(a) 	
      to pay the Agent a non-refundable work fee of CDN$10,000
      plus HST thereon (the “Work Fee”) (which Work Fee plus HST has been
      paid and will be credited against the Agent’s legal costs);

	 	 	 
		(b) 	
      to pay to the Agent at the Closing Time a cash commission
      equal to 6% of the gross proceeds of the aggregate number of Units sold
      pursuant to the Brokered Offering including in respect of any Units
      purchased by the Agent as principal hereunder and any Optioned Securities
      issued and sold by the Corporation on the exercise of the Over-Allotment
      Option (excluding Units sold pursuant to the Non- Brokered Offering);
      and

	 	 	 
		(c) 	
      to issue to the Agent, or to a member of the Selling
      Group as the Agent may direct, at the Closing Time Agent’s Compensation
      Options equal to 6% of the aggregate number of Units sold pursuant to the
      Brokered Offering and the Over- Allotment Option (excluding Units sold
      pursuant to Non-Brokered Offering), where each Agent’s Compensation Option
      entitles the Agents to purchase one Unit of the Corporation (an
      “Agent’s Unit“) at CDN$0.35 per Agent’s Unit for a period of 18
      months from the Liquidity Date; each such Agent’s Unit consisting of one
      Common Share (an “Agent’s Unit Share”) and one-half of one non-
      transferable Common Share purchase warrant (an “Agent’s Warrant”)
      where each Agent’s Warrant is exercisable into one Common Share of the
      Corporation (an “Agent’s Warrant Share”) to the extent exercised at
      any time prior to 5:00 p.m. (Vancouver time) on the date that is 18 months
      from the Liquidity Date upon payment to the Corporation of CDN$0.50 per
      Agent’s Warrant Share; the Agent’s Compensation Options and Agent’s
      Warrants shall not be subject to the Acceleration Right and shall be in
      such form and contain such terms as shall be mutually approved by the
      Corporation and the Agent prior to the Closing Date.

	 	 	 
	9.2 	
      Whether or not the transactions contemplated herein shall
      be completed, all reasonable and documented costs and expenses of or
      incidental to the distribution of the Securities (the “Agent’s
      Expenses”), including but not limited to the fees and disbursements of
      the Agent’s Counsel plus taxes thereon (net of the CDN$10.000 Work Fee
      paid to the Agent) shall be borne by the Corporation and shall be paid on
      Closing or, in the event this Agreement is terminated by either party for
      any reason or for no reason, upon termination of this Agreement.

	 	 	 
	9.3 	
      The Corporation further agrees that in the event the
      Agent shall incur any reasonable and documented costs and expenses,
      including but not limited to the reasonable fees and disbursements of the
      Agent’s Counsel (and taxes thereon) subsequent to the final Closing of the
      Brokered Offering (the “Agent’s Additional Expenses”), with respect
      to or incidental to the completion of: (i) the filing of the BC 51-509F4
      notice, (ii) the filing of the Registration Statement or (iii) the
      subsequent removal of the U.S. legends as set
out

- 29 -

herein, the Agent’s Additional
Expenses, which shall not exceed CDN$10,000 without the written consent of the
Corporation, shall be borne by the Corporation and payable by the Corporation to
the Agent upon submission of the Agent’s invoice for the Agent’s Additional
Expenses.

ARTICLE 10

  LEGENDS 

	10.1 	
      For purposes of complying with Applicable Securities Laws
      in Canada, the rules of the Recognized Exchange, the U.S. Securities Act
      and applicable U.S. state securities laws, and until such time as is no
      longer required under applicable requirements of the Applicable Securities
      Laws in Canada, the rules of the Recognized Exchange, the U.S. Securities
      Act or applicable state securities laws, all certificates representing the
      Unit Shares, and the Warrant Shares, Agent’s Unit Shares and Agent’s
      Warrant Shares (to the extent that such securities are issued prior to the
      expiry of the applicable hold periods) will bear, as of the Closing Date,
      the following legends as required by National Instrument 45-102 –
      Resale of Securities and the U.S. Securities Act and the rules and
      regulations promulgated thereunder with the necessary information inserted
      and the Agent agrees to the comply with the terms of such
legend:

	 	 
		
      “UNLESS PERMITTED UNDER CANADIAN SECURITIES
      LEGISLATION THE HOLDER OF THIS SECURITY MUST NOT TRADE THE SECURITY IN
      CANADA BEFORE [INSERT THE DATE THAT IS FOUR (4) MONTHS AND A DAY AFTER THE
      DISTRIBUTION DATE].”

	 	 
		
      “WITHOUT PRIOR WRITTEN APPROVAL OF THE TSX VENTURE
      EXCHANGE INC. AND COMPLIANCE WITH ALL APPLICABLE SECURITIES LEGISLATION,
      THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD,
      TRANSFERRED, HYPOTHECATED OR OTHERWISE TRADED ON OR THROUGH THE FACILITIES
      OF THE TSX VENTURE EXCHANGE OR OTHERWISE IN CANADA OR TO OR FOR THE
      BENEFIT OF A CANADIAN RESIDENT UNTIL [INSERT DATE THAT IS FOUR (4) MONTHS
      AND A DAY AFTER THE DISTRIBUTION DATE.]”

	 	 
		
      “THE SECURITIES REPRESENTED HEREBY HAVE BEEN OFFERED
      IN AN OFFSHORE TRANSACTION TO A PERSON WHO IS NOT A U.S. PERSON (AS
      DEFINED HEREIN) PURSUANT TO REGULATION S UNDER THE UNITED STATES
      SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”). NONE OF THE
      SECURITIES REPRESENTED HEREBY HAVE BEEN REGISTERED UNDER THE 1933 ACT, OR
      ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED, MAY NOT BE
      OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES (AS DEFINED
      HEREIN) OR TO U.S. PERSONS EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF
      REGULATION S UNDER THE 1933 ACT, PURSUANT TO AN EFFECTIVE REGISTRATION
      STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM,
      OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
      1933 ACT

- 30 - 

		
      AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE
        SECURITIES LAWS. IN ADDITION, HEDGING TRANSACTIONS INVOLVING THE SECURITIES
        MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE 1933 ACT. “UNITED
        STATES” AND “U.S. PERSON” ARE AS DEFINED BY REGULATION
        S UNDER THE 1933 ACT.”

      
	 	 
	10.2 	
      For purposes of complying with Applicable Securities Laws
      in Canada, the rules of the Recognized Exchange, the U.S. Securities Act
      and applicable U.S. state securities laws, and until such time as is no
      longer required under applicable requirements of the Applicable Securities
      Laws in Canada, the rules of the Recognized Exchange, the U.S. Securities
      Act or applicable state securities laws, all the certificates representing
      the Warrants, the Agent’s Compensation Options and the Agent’s Warrants
      comprised within the Agent’s Compensation Options (to the extent that such
      securities are issued prior to the expiry of the applicable hold period)
      and all certificates issued in exchange therefor or in substitution
      thereof, shall bear legends substantially similar to the following and the
      Agent agrees to comply with the terms of such legends:

	 	 
		
      “UNLESS PERMITTED UNDER CANADIAN SECURITIES
      LEGISLATION THE HOLDER OF THIS SECURITY MUST NOT TRADE THE SECURITY IN
      CANADA BEFORE [INSERT THE DATE THAT IS FOUR (4) MONTHS AND A DAY AFTER THE
      DISTRIBUTION DATE].”

	 	 
		
      “WITHOUT PRIOR WRITTEN APPROVAL OF THE TSX VENTURE
      EXCHANGE INC. AND COMPLIANCE WITH ALL APPLICABLE SECURITIES LEGISLATION,
      THE SECURITIES REPRESENTED BY THIS CERTIFICATE AND ANY SECURITIES ISSUED
      ON THE EXERCISE OF ANY SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT
      BE SOLD, TRANSFERRED, HYPOTHECATED OR OTHERWISE TRADED ON OR THROUGH THE
      FACILITIES OF THE TSX VENTURE EXCHANGE OR OTHERWISE IN CANADA OR TO OR FOR
      THE BENEFIT OF A CANADIAN RESIDENT UNTIL [INSERT DATE THAT IS FOUR (4)
      MONTHS AND A DAY AFTER THE DISTRIBUTION DATE].”

	 	 
		
      “THE SECURITIES REPRESENTED BY THIS CERTIFICATE AND
      THE SECURITIES TO BE ISSUED UPON ITS EXERCISE HAVE NOT BEEN REGISTERED
      UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”) OR ANY
      STATE SECURITIES LAWS, AND HAVE BEEN ISSUED IN RELIANCE UPON AN EXEMPTION
      FROM THE REGISTRATION REQUIREMENTS OF THE 1933 ACT. SUCH SECURITIES MAY
      NOT BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES (AS
      DEFINED HEREIN) OR TO U.S. PERSONS (AS DEFINED HEREIN) EXCEPT IN
      ACCORDANCE WITH THE PROVISIONS OF REGULATION S UNDER THE 1933 ACT,
      PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT, OR
      PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT
      TO, THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE ONLY IN
      ACCORDANCE WITH APPLICABLE STATE SECURITIES
LAWS.

- 31 -

IN ADDITION, HEDGING TRANSACTIONS
INVOLVING THE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE 1933
ACT. “UNITED STATES” AND “U.S. PERSON” ARE AS DEFINED BY REGULATION S UNDER THE
1933 ACT.” 

	10.3 	
      For purposes of complying with Applicable Securities Laws
      in British Columbia, and until such time as is no longer required under
      applicable requirements of the Applicable Securities Laws in British
      Columbia, all certificates representing the Unit Shares, the Warrants and
      the Warrant Shares underlying the Warrants comprised within the Units (to
      the extent that such Warrant Shares are issued prior to the expiry of the
      applicable hold period) issued to Subscribers resident in British Columbia
      and all certificates issued in exchange therefor or in substitution
      thereof, are required to bear the BC Legend substantially similar to the
      following:

	 	 
		
      “UNLESS OTHERWISE PERMITTED UNDER SECURITIES
      LEGISLATION, THE HOLDER OF THIS SECURITY MUST NOT TRADE THE SECURITY IN OR
      FROM BRITISH COLUMBIA UNLESS THE CONDITIONS IN SECTION 12 (2) OF BC
      INSTRUMENT 51-509 ISSUERS QUOTED IN THE U.S. OVER-THE- COUNTER MARKET ARE
      MET”

	 	 
		
      however, pursuant to the representations and warranties
      made by the Subscribers in the Subscription Agreements, the Subscribers
      have directed the Corporation not to include the BC Legend as set out in
      this section 10.3 on any certificates representing the Securities to be
      issued to such Subscribers, and, as a consequence, the Subscribers will
      not be able to rely on the resale provisions of BCI 51-509 with respect to
      any Securities sold in, to or from British Columbia.

	 	 
	10.4 	
      For purposes of complying with Applicable Securities Laws
      in British Columbia and the resale restrictions as set out in section 10.3
      above, and for so long as the Corporation remains an “OTC reporting
      issuer” pursuant to BCI 51-509:

	 	(a) 	
      a subsequent trade in the Securities in, to or from
      British Columbia will be a distribution subject to the prospectus and
      registration requirements of Applicable Securities Laws in British
      Columbia unless certain conditions are met, which conditions include,
      among others, a requirement that any certificate representing the
      Securities (or ownership statement issued under a direct registration
      system or other book entry system) bear the restrictive legend specified
      in BCI 51-509 (the “BC Legend”) as set out in section 10.3
      above;

	 	 	 
	 	(b) 	
      the Corporation will refuse to register any transfer of
      any of the Unit Shares, Warrants or Warrant Shares in, to or from British
      Columbia that is not made in accordance with the provisions of BCI
      51-509.

ARTICLE 11 

  REGISTRATION STATEMENT

	11.1 	
      The Corporation hereby agrees that, within 20 Business
      Days of the Liquidity Date, the Corporation shall file with the SEC a
      Registration Statement on Form S-1 (the

- 32 -

“Registration Statement”), or on
such other form as is available, registering the resale of the Unit Shares,
Warrant Shares, Agent’s Unit Shares and Agent’s Warrant Shares by the
Subscribers and the Agent, respectively. The Corporation agrees to use
commercially reasonable efforts to: (a) cause the Registration Statement to be
declared effective by the SEC and (b) keep the Registration Statement effective
pursuant to Rule 415 of the U.S. Securities Act for a period commencing on the
date the Registration Statement is declared effective by the SEC (the
“Effective Date”) up to and including the date that is thirty (30) months
from the Liquidity Date (the “Effective Period”).

	11.2 	
      Within 10 Business Days of the Registration Statement
      being declared effective by the SEC the Corporation shall provide to the
      Agent a legal opinion with respect to the first trades in the U.S. of the
      Unit Shares, and Warrant Shares comprised within the Securities and the
      Agent’s Unit Shares, and the Agent’s Warrant Shares comprised within the
      Agent’s Compensations.

	 	 
	11.3 	
      Within ten (10) Business Days of the SEC declaring the
      Registration Statement effective, the Corporation shall notify each
      Subscriber, or cause each Subscriber to be notified, of such declaration
      and shall provide each Subscriber with such documents and instructions as
      are necessary to remove the U.S. restrictive legend set out in section
      10.1 above from the certificates representing the Unit Shares, Warrant
      Shares, Agent’s Unit Shares and Agent’s Warrant Shares, as
    applicable.

	 	 
	11.4 	
      The Corporation also agrees with the Agent that it will
      undertake to: (i) take such steps as are necessary and (ii) file such
      documents as are necessary such that Corporation shall maintain its
      “reporting” status under section 13(a) of the U.S. Exchange Act
      during the Effective Period provided that the foregoing will not restrict
      the ability of the Corporation to complete a merger, sale, acquisition,
      continuation or similar transaction, so long as the resulting corporation
      from such transaction is a “reporting” company under the U.S.
      Exchange Act.

	 	 
	11.5 	
      All expenses incurred in connection with the filing and
      registration of the Registration Statement and the removal of any legends,
      if applicable, including, without limitation, all registration,
      qualifications, printers, legal, transfer and accounting fees shall be
      paid by the Corporation.

	 	 
	11.6 	
      The Agent acknowledges that the Corporation’s ability to
      cause the Registration Statement to be declared effective is subject to
      regulatory approval of the SEC.

ARTICLE 12 
REMOVAL OF U.S. RESTRICTIVE
LEGENDS

	12.1 	
      The Corporation agrees that upon the SEC declaring the
      Registration Statement effective and without any further action on the
      part of the Subscribers, the Agent or any Selling Group member, the
      Corporation shall provide to each Subscriber, the Agent and each Selling
      Group member, the form of declaration substantially as set out in Schedule
      “C” attached hereto (the “Declaration”) and that upon the surrender
      of share certificates representing any Unit Shares, Warrant Shares,
      Agent’s Unit Shares and Agent’s Warrant

- 33 -

Shares issued prior to the Effective
Date and a duly completed and executed Declaration by the holder thereof to the
office of the Corporation, the Corporation shall subsequently remove or cause to
be removed the U.S. restrictive legend from such share certificates.

	12.2 	
      The Agent understands and agrees that prior to: (i) the
      SEC declaring the Registration Statement effective or (ii) the removal of
      the restrictive legends, as applicable, the Corporation will refuse to
      register any transfer of the Agent’s Compensation Option, the Agent’s Unit
      Shares, the Agent’s Warrants or the Agent’s Warrant Shares (whether issued
      to the Agent or to any member of the Selling Group) not made in accordance
      with the provisions of Regulation S under the U.S. Securities Act,
      pursuant to an effective registration statement under the U.S. Securities
      Act or pursuant to an available exemption from the registration
      requirements of the U.S. Securities Act, and in each case in compliance
      with any applicable state securities laws. Notwithstanding the forgoing,
      the Corporation confirms, acknowledges and agrees (i) that it shall take
      all commercially reasonable steps to have the Registration Statement
      declared effective by the SEC on or before the date that is six (6) months
      from the Liquidity Date and further that during the Effective Period, the
      Corporation shall take all commercially reasonable steps to remove the
      restrictive legends from any Agent’s Unit Shares and Agent’s Warrant
      Shares as set out in section 12.1 above.

	 	 
	12.3 	
      The Corporation agrees that expenses incurred in
      connection with the removal of any U.S. restrictive legend as set out in
      section 12.1 above, including, but not limited to expenses incurred with
      respect to the provision of any legal opinion from the Corporation’s
      counsel, the form of Declaration and any transfer fees shall be paid by
      the Corporation.

ARTICLE 13 

  EARLY TERMINATION

	13.1 	
      All representations, warranties, covenants, terms and
      conditions of this Agreement shall be construed as conditions, and any
      material breach or failure to comply with any such representation,
      warranty, covenant, term or condition by the Corporation shall entitle the
      Agent to terminate its obligation to distribute the Securities by written
      notice to that effect given to the Corporation prior to the Closing Date.
      The Agent may waive in whole or in part any breach of, default under or
      non-compliance by the Corporation with, any representation, warranty,
      covenant, term or condition hereof, or extend the time for compliance
      therewith, without prejudice to any of its rights in respect of any other
      representation, warranty, covenant, term or condition hereof, any other
      breach of, default under or non-compliance with any other representation,
      warranty, covenant, term or condition hereof, provided that any such
      waiver or extension shall be binding on the Agent only if the same is in
      writing.

	 	 
	13.2 	
      In addition to any other remedies which may be available
      to the Agent, the Agent shall be entitled, at its option, to terminate and
      cancel, without any liability on the Agent’s part, the Agent’s obligations
      under this Agreement if, prior to the Closing Time any of the following
      occurs:

- 34 -

	 	(a) 	
      any order (other than an order based on the activities or
      alleged activities of the Agent or any member of the Selling Group) to
      cease or suspend trading in any securities of the Corporation, or
      prohibiting or restricting the distribution of the Securities, the Agent’s
      Compensation Options or the securities comprised therein is made, or any
      proceedings are announced, commenced or threatened for the making of any
      such order, by the SEC or any Securities Commission, stock exchange,
      governmental agency, regulatory body or by any other competent authority,
      and the same has not been rescinded, revoked or withdrawn;

	 	 	 
	 	(b) 	
      any inquiry, investigation or other proceeding (whether
      formal or informal) in relation to the Corporation or any of its directors
      or senior officers is announced, commenced or threatened by the SEC or any
      Securities Commission, stock exchange, governmental agency, regulatory
      body or any other competent authority or any order is issued under or
      pursuant to any Canadian or American statute, or any other applicable law
      or regulatory authority (unless based on the activities or alleged
      activities of the Agent or a Selling Group member), or there is any change
      of law, regulation or policy or the interpretation or administration
      thereof, which, in the sole opinion of the Agent, operates to materially
      prevent or restrict trading in the Common Shares or the distribution of
      the Securities, the Agent’s Compensation Options or the securities
      comprised therein and which has not been rescinded, revoked or
      withdrawn;

	 	 	 
	 	(c) 	
      there should occur any change, event, fact or
      circumstance (actual, contemplated or threatened) or any development that
      could result in such a change, event, fact or circumstance, or the Agent
      has become aware, as a result of its due diligence review or otherwise, of
      any adverse material information, fact or change (determined solely by the
      Agent) with respect to the Corporation which had not been publicly
      disclosed or disclosed by the Corporation in writing to the Agent prior to
      the date hereof, any of which, in the opinion of the Agent, as determined
      by the Agent in its sole discretion, could reasonably be expected to have
      a material adverse effect on the market price or value or the
      marketability of the Securities;

	 	 	 
	 	(d) 	
      there should develop, occur or come into effect or
      existence any event, action, state, condition or major financial
      occurrence of national or international consequence or any action by
      government, law or regulation, enquiry or other such occurrence which, in
      the sole opinion of the Agent, materially adversely affects or involves,
      or might reasonably be expected to materially adversely affect or involve,
      the financial markets or the business, operations or affairs of the
      Corporation;

	 	 	 
	 	(e) 	
      the state of the financial markets or of the industry or
      markets in which the Corporation operates is or becomes such that the
      Securities cannot, in the reasonable opinion of the Agent, be successfully
      or profitably marketed;

- 35 -

	 	(f) 	
      the Agent determines that the Corporation is in breach
      of, default under or non- compliance with any material representation,
      warranty, covenant, term or condition of this Agreement or the
      Subscription Agreements; or

	 	 	 
	 	(g) 	
      the Agent, in its sole discretion, is not reasonably
      satisfied with the results of any due diligence investigations and
      examinations with respect to the Corporation conducted by or on behalf of
      the Agent.

	13.3 	
      The Agent may exercise any or all of the rights provided
      for in sections 8.1, 13.1 or 13.2, notwithstanding any act or thing taken
      or done by the Agent or any action by the Agent, whether before or after
      the occurrence of any material change, including, without limitation, any
      act of the Agent related to the offering or continued offering of the
      Securities for sale and the Agent shall only be considered to have waived
      or be estopped from expressing or relying upon any of its rights under or
      pursuant to sections 8.1, 13.1 or 13.2 if such waiver or estoppel is in
      writing and specifically waives or estops such exercise or
  reliance.

	 	 
	13.4 	
      Any termination pursuant to the terms of this Agreement
      shall be effected by notice in writing delivered to the Corporation;
      provided that no termination shall discharge or otherwise affect any
      obligations of the Corporation under sections 9.1, 9.2, 14.1, 14.2 or
      14.3. The rights of the Agent to terminate its obligations hereunder are
      in addition to, and without prejudice to, any other remedies the Agent may
      have.

ARTICLE 14 
INDEMNIFICATION AND CONTRIBUTION

	14.1 	
      The Corporation shall indemnify and save the Agent, and
      each and every one of the Agent’s directors, officers, employees,
      consultants, shareholders and the Selling Group members (collectively
      “Indemnified Parties” and singularly an “Indemnified
      Person”) harmless against and from all liabilities (whether joint or
      several), claims, actions, demands, losses (other than losses of profit in
      connection with the distribution of the Securities), costs, damages and
      expenses (including reasonable legal fees and expenses) (collectively, the
      “Liabilities”) to which such person or companies may be subject or
      which such person or companies may suffer or incur, whether under the
      provisions of any statute or otherwise, in any way caused by, or arising
      directly or indirectly from or in consequence of:

	 	 	 
		(a) 	
      any misrepresentation or alleged misrepresentation
      contained in the Public Record (other than any information or statement
      relating solely to the Agent or any member of the Selling Group and
      furnished to the Corporation by the Indemnified Parties expressly for
      inclusion in the Public Record) or contained in this Agreement or any
      certificate or other document delivered by or on behalf of the Corporation
      to the Indemnified Parties hereunder;

	 	 	 
		(b) 	
      any prohibition or restriction of trading in the
      securities of the Corporation or any prohibition or restriction affecting
      the distribution of the Securities, the Agent’s Compensation Options or
      the securities comprised therein imposed by the SEC
or

- 36 -

any Securities Commission, stock
exchange or any other competent authority if such prohibition or restriction is
based on any misrepresentation or alleged misrepresentation of a kind referred
to in subsection 14.1(a) (except a misrepresentation relating solely to the
Agent or any member of the Selling Group); 

	 	(c) 	
      any order made or any inquiry, investigation (whether
      formal or informal) or other proceeding commenced or threatened by the SEC
      or any Securities Commission, stock exchange, or any other one or more
      competent authorities into the affairs of the Corporation or any of its
      directors, officers or principal shareholders or relating to or affecting
      the distribution of the Securities, the Agent’s Compensation Options or
      the securities comprised therein other than any such order, inquiry,
      investigation or other proceeding based solely upon the activities or
      alleged activities of the Indemnified Parties;

	 	 	 
	 	(d) 	
      any breach of, default under or non-compliance by the
      Corporation with any representation, warranty, covenant, term or condition
      of this Agreement or any requirement of Applicable Business Laws,
      Applicable Securities Laws, the U.S. Securities Act or other U.S. Exchange
      Act;

	 	 	 
	 	(e) 	
      the exercise by any purchaser of Securities of any
      contractual or statutory right of rescission in connection with the
      purchase thereof; or

	 	 	 
	 	(f) 	
      the performance of professional services rendered to the
      Corporation by the Indemnified Parties hereunder or in connection with the
      Offering.

The Corporation hereby waives its right to recover contribution
from the Indemnified Parties with respect to any liability of the Corporation by
reason of or arising out of any misrepresentation in the Public Record provided,
however, that such waiver shall not apply in respect of liability caused or
incurred by reason of or arising out of (i) any misrepresentation which is based
upon information relating solely to the Indemnified Parties contained in such
document and furnished to the Corporation by the Indemnified Parties expressly
for inclusion in such document or (ii) any failure by the Indemnified Parties to
provide to prospective purchasers of Securities any document which the
Corporation is required to provide to such prospective purchasers and which the
Corporation has provided to the Indemnified Parties to forward to such
prospective purchasers. 

With respect to any Selling Group member in respect of which
indemnification is or might reasonably be considered to be provided for in this
Article 14 and who is not a party to this Agreement, the Agent shall obtain and
hold the rights and benefits of this Article 14 in trust for and on behalf of
such Selling Group member. 

The Corporation agrees that in case any legal proceedings or
investigation shall be brought against or initiated against the Corporation by
the SEC or any Securities Commission, regulatory authority, stock exchange,
court, or other entity having regulatory authority, and an Indemnified Person or
other representatives of the Agent shall be required to testify in connection
therewith or shall be required to respond to procedures designed to discover
information regarding, in

- 37 -

connection with, or by reason of the performance of
professional services rendered to the Corporation by the Agent, the Corporation
shall pay the Indemnified Parties their respective reasonable costs arising from
such a requirement (including an amount to reimburse the Agent for time spent by
their personnel in connection therewith on a per diem basis and out-of-pocket
expenses incurred by their personnel in connection therewith) as they occur
unless such proceedings or investigations shall be brought or initiated as a
result of any actions or inaction of the Indemnified Parties, or any of them, or
any Selling Group members, if any. 

The rights of indemnity contained in this Article 14 shall not
apply to an Indemnified Person if the proceedings or liabilities in respect of
which indemnification is being sought were solely and directly caused by the
negligence, fraud, wilful misconduct or bad faith of the Agent (including a
Selling Group member) or other Indemnified Person. 

	14.2 	
      If any claim contemplated by section 14.1 shall be
      asserted against any Indemnified Person, such Indemnified Person shall
      notify the Corporation as soon as possible of the nature of such claim
      (provided that any failure to so notify shall not affect the Corporation’s
      liability hereunder) and the Corporation shall be entitled (but not
      required) to assume the defence of any suit brought to enforce such claim,
      provided however, that the defence shall be through legal counsel selected
      by the Corporation and acceptable to the Indemnified Person and that no
      settlement may be made by the Corporation or the Indemnified Person
      without the prior written consent of the other, such consent not to be
      unreasonably withheld. The Indemnified Person shall have the right to
      retain its own counsel in any proceeding relating to a claim contemplated
      by Article 14 if:

	 	 	 
		(a) 	
      the Corporation or the Indemnified Person has been
      advised by counsel that there are legal defences available to the
      Indemnified Person which are different from or additional to defences
      available to the Corporation (in which case the Corporation shall not have
      the right to assume the defence of such proceedings on the Indemnified
      Person’s behalf);

	 	 	 
		(b) 	
      the Corporation shall not have taken the defence of such
      proceedings and employed counsel within 10 Business Days after receiving
      notice of commencement of such proceedings; or

	 	 	 
		(c) 	
      the employment of such counsel has been authorized by the
      Corporation in connection with the defence of such proceedings;

	 	 	 
			
      and, in any such event, the reasonable fees and expenses
      of such Indemnified Person’s counsel (on a solicitor and his client basis)
      shall be paid by the Corporation.

	 	 	 
	14.3 	
      In order to provide for just and equitable contribution
      in circumstances in which the indemnification provided for in this
      Agreement is due in accordance with its terms but is, in whole or in part,
      for any reason, held by a court to be unavailable for the Corporation on
      grounds of policy or otherwise, each of the Corporation and the party or
      parties seeking indemnification shall contribute to the aggregate
      liabilities, claims, demands, losses (other than losses of profit in
      connection with the distribution of the Securities), costs, damages and
      expenses (including legal or other expenses reasonably incurred
  in

- 38 -

connection with the investigation or
defence of the same) to which they may be subject or which they may suffer or
incur: 

	 	(a) 	
      in such proportion as is appropriate to reflect the
      relative benefit received by the Corporation on the one hand, and by the
      party or parties seeking indemnity on the other hand, from the Brokered
      Offering; or

	 	 	 
	 	(b) 	
      if the allocation provided by paragraph (a) above is not
      permitted by applicable law, in such proportion as is appropriate to
      reflect not only the relative benefits referred to in paragraph (a) above
      but also to reflect the relative fault of the party or parties seeking
      indemnity, on the one hand, and the parties from whom indemnity is sought,
      on the other hand, in connection with the statements or omissions or other
      matters which resulted in such liabilities, claims, demands, losses,
      costs, damages or expenses as well as any other relevant equitable
      considerations.

The relative benefits received by the Corporation, on the one
hand, and the Agent on the other hand shall be deemed to be in the same
proportion that the total proceeds of the Brokered Offering, the Over-Allotment
Option and the Agent’s Compensation Options received by the Corporation (net of
fees but before deducting expenses) bear to the fees received by the Agent. In
any event, the Corporation and the Agent agree that any contribution of the
Indemnified Parties shall be limited to the fees paid to the Agent in connection
with the distribution of the Securities. The Corporation agrees that it would
not be just and equitable if contributions pursuant to this Agreement were
determined by any other method of allocation than those referred to above. 

The rights to indemnification and contribution provided in this
Article 14 shall be in addition to, and without prejudice to, any other rights
which the Agent may have by statute or otherwise by law. 

ARTICLE 15 

  LIQUIDITY EVENT

	15.1 	
      The Corporation hereby covenants to and with the Agent
      and acknowledges that the Agent is relying on such covenants as
      follows:

	 	 	 
		(a) 	
      during the period commencing on the date hereof and
      ending on the Liquidity Date, the Corporation will promptly provide to the
      Agent, for review prior to the publication, filing or issuance thereof,
      any listing application, prospectus or other transaction documents(s)
      which will result in all the outstanding Common Shares of the Corporation
      being traded on the Recognized Exchange and the Common Shares being freely
      tradable on such exchange;

	 	 	 
		(b) 	
      subject to any regulatory approvals, upon closing of the
      Liquidity Event the Corporation will be a “reporting issuer” in the
      province of Bristish Columbia, Alberta and such other provinces as the
      Agent and the Corporation may agree, within the meaning of the Applicable
      Securities Laws of such provinces and shall not be in default of any
      requirement thereto, and will be an “electronic
  filer

- 39 - 

under N1 13-101” (as that term
is used in National Instrument 45-102 -Resale of Securities); and 

	 	(c) 	
      upon closing of the Liquidity Event the definitive form
      of certificates representing the Securities and the Agent’s Compensation
      Options and the securities comprised therein shall comply with the
      requirements of the Recognized Exchange.

	 	 	 
	 	(d) 	
      the definitive form of certificates for the Securities
      issued by the Corporation will have been duly approved by the Directors of
      the Corporation, and will be in due and proper form under the laws
      governing the Corporation.

ARTICLE 16 
SURVIVAL OF REPRESENTATIONS,
WARRANTIES, COVENANTS, TERMS AND CONDITIONS

	16.1 	
      It is understood that all representations, warranties,
      covenants, indemnities, terms and conditions herein or contained in
      certificates or documents submitted pursuant to or in connection with the
      transactions contemplated herein shall survive Closing and the termination
      of this Agreement and shall continue in full force and effect for the
      benefit of the Agent regardless of any investigation by or on behalf of
      the Agent with respect thereto.

ARTICLE 17

  NOTICES 

	17.1 	
      Any notice or other communication to be given hereunder
      shall, in the case of notice to be given:

	 	 	 
		(a) 	
      to the Corporation, be addressed to the Corporation at
      the above address, Fax No. (604) 684-9365 with a copy to O'Neill Law
      Corporation at 650 West Georgia Street, Suite 950, PO Box 11587,
      Vancouver, British Columbia V6B 4N8, Attention: Charles Hethey, Fax No.
      (604) 687-6650; and

	 	 	 
		(b) 	
      to the Agent, be addressed to: MGI Securities Inc. at 26
      Wellington St. E., Suite 900, Toronto, Ontario, M5E 1S2, Attention: Daniel
      C. Hardie, Fax No. (416) 864-6485 with a copy to: Blaney McMurtry LLP at 2
      Queen Street East, Suite 1500, Toronto, Ontario, M5C 3G5, Attention: Brian
      L. Prill, Fax No. (461) 594- 2444.

Any such notice or other communication shall be in writing and
may be given by telefax or delivery, and shall be deemed to have been given on
the day on which it is telefaxed (provided, that it is telefaxed by 5:00 p.m.
(Vancouver time) on a Business Day, otherwise notice shall be deemed to have
been so given on the next Business Day) or upon receipt by a responsible officer
of the addressee if delivered. 

- 40 - 

ARTICLE 18 
AGENT’S COVENANTS

	18.1 	
      The Agent covenants and agrees with the Corporation that
      it shall, and that it shall take such steps as are commercially reasonably
      to cause each member of the Selling Group to:

	 	 	 
		(a) 	
      conduct all activities in connection with the Brokered
      Offering in compliance with all applicable securities laws in force from
      time to time in the applicable Offering Jurisdictions and, without
      limitation, agrees that it will not take any actions or make available to
      prospective Subscribers any document or material which would constitute or
      require the Corporation to prepare an offering memorandum as defined under
      Applicable Securities Laws;

	 	 	 
		(b) 	
      not solicit subscriptions for Securities, trade in
      Securities or otherwise do any act in furtherance of a trade of Securities
      outside of the applicable Offering Jurisdictions except in compliance with
      the applicable laws thereof and with the express written consent of the
      Corporation;

	 	 	 
		(c) 	
      use its commercially reasonable efforts to obtain and to
      deliver to the Corporation at least 72 hours prior to the Closing Time a
      duly completed Subscription Agreement and such other documents
      specifically referred to in the Subscription Agreements or as are required
      under Applicable Securities Laws and supplied to the Agent by the
      Corporation for completion in connection with the Brokered Offering, all
      of which have been executed by each of the Subscribers;

	 	 	 
		(d) 	
      use its commercially reasonable efforts to ensure that
      none of the funds the Subscriber is using to purchase the Securities are,
      to the knowledge of the Agent, proceeds obtained or derived, directly or
      indirectly, as a result of illegal activities;

	 	 	 
		(e) 	
      not advertise the proposed offering or sale of the
      Securities in the printed public media, radio or television; and

	 	 	 
		(f) 	
      not solicit subscriptions for Securities except in
      accordance with the terms and conditions of this Agreement;

	 	 	 
		(g) 	
      not make any “directed selling efforts” (as such
      term is defined in Regulation S of the U.S. Securities Act) in the United
      States with respect to offers or sales of the Securities;

	 	 	 
		(h) 	
      not engage in any form of “general solicitation”
      or “general advertising” (as such terms are defined in Rule
      502(c) under Regulation D of the U.S. Securities Act) in the United States
      with respect to offers or sales of the Securities; and

	 	 	 
		(i) 	
      not make any offer to sell, any solicitation of an offer
      to buy, or any sale of any of the Securities to any person in the United
      States or to, or for the account or benefit of, any U.S.
  Person.

- 41 - 

ARTICLE 19 
CONFIDENTIALITY

	19.1 	
      The Agent will hold in confidence all information
      received by it from the Corporation which has not been generally disclosed
      to the public and will not knowingly disclose such information, except as
      required in its reasonable opinion, to discharge its obligations: (i)
      under this Agreement or (ii) by law.

ARTICLE 20 

  RIGHT OF FIRST REFUSAL

	20.1 	
      The Corporation will notify the Agent in writing (the
      “Corporation’s Notice”) of the terms of any further equity (or
      securities convertible into equity) financing that the Corporation may
      require or proposes to obtain during the period commencing on the date
      hereof and ending on the date that is 18 months from the Liquidity Date
      (the “ROFR Period”) and the Agent will have the right of first
      refusal to act as agent for the Corporation with respect to any such
      financing during the ROFR Period.

	 	 
	20.2 	
      The right of first refusal must be exercised by the Agent
      within 15 Business Days following the receipt of the Corporation’s Notice
      by notifying the Corporation in writing (the “Agent’s Notice”) that
      the Agent agrees to act as agent for the Corporation with respect to such
      financing on the terms as set out in the Corporation’s Notice.

	 	 
	20.3 	
      If the Agent fails to exercise the right of first refusal
      and provide the Agent’s Notice to the Corporation in writing within 15
      Business Days of the Corporation’s Notice confirming that the Agent will
      act as the agent for the Corporation with respect to such financing upon
      the terms set out in the Corporation’s Notice, the Corporation may engage
      such other parties as the Corporation deems advisable to act as agent with
      respect to such financing on the same terms or on terms no less favourable
      to the Corporation as described in the Corporation’s Notice, subject to
      obtaining the acceptance of the applicable regulatory
  authorities.

	 	 
	20.4 	
      The right of first refusal will not terminate with
      respect to any other equity (or securities convertible into equity)
      financing that the Corporation may require or propose to obtain during the
      ROFR Period if, on receipt of the Corporation’s Notice, the Agent fails to
      exercise the Agent’s right of first refusal.

ARTICLE 21

  GENERAL 

	21.1 	
      If any one or more of the provisions contained herein
      shall, for any reason, be held to be invalid, illegal or unenforceable in
      any respect, such invalidity, illegality or unenforceability shall not
      affect any other provision of this Agreement, but this Agreement shall be
      construed as if such invalid, illegal or unenforceable provision or
      provisions had never been contained herein.

	 	 
	21.2 	
      This Agreement shall be governed by and construed in
      accordance with the laws of the Province of British Columbia and the
      federal laws of Canada applicable therein and
each

- 42 -

of the parties hereto irrevocably
attorns to the non-exclusive jurisdiction of the courts of the Province of
British Columbia. 

	21.3 	
      Time shall be of the essence of this Agreement.

	 	 
	21.4 	
      This Agreement may be executed in two or more
      counterparts, each of which shall be deemed to be an original and all of
      which together shall constitute one and the same Agreement.

	 	 
	21.5 	
      The Corporation and the Agent shall be entitled to rely
      on delivery of a facsimile or PDF copy of the executed Agreement, and
      acceptance by the Corporation or the Agent of such facsimile or PDF copy
      shall be legally effective to create a valid and binding agreement between
      the Corporation and the Agent in accordance with the terms
  hereof.

	 	 
	21.6 	
      This Agreement represents the entire agreement of the
      parties hereto relating to the subject matter hereof and there are no
      representations, warranties, covenants or other agreements relating to the
      subject matter hereof except as stated or referred to herein and without
      limiting the generality of the foregoing, upon execution of this Agreement
      by both parties the letter agreement with respect to the Brokered Offering
      between the Corporation and the Agent, dated January 24, 2011, shall be
      deemed to be terminated.

	 	 
	21.7 	
      It is understood that the terms and conditions of this
      Agreement supersede any previous verbal or written agreement between the
      Agent and the Corporation. In the event that execution pages are delivered
      to the parties hereto without this entire agreement, the parties hereto
      are entitled to assume that the executing party has accepted all of the
      terms and conditions contained in the parts of this Agreement that are not
      returned, without amendment or modification. This Agreement may be amended
      or modified in any respect by written instrument only. In the event of any
      inconsistency between the provisions of this Agreement and the
      Subscription Agreement, the provisions of this Agreement shall
    prevail.

	 	 
	21.8 	
      Unless otherwise expressly provided all references herein
      to dollar amounts are to lawful money of Canada.

	 	 
	21.9 	
      The parties acknowledge that it is their express wish
      that this Agreement, as well as all documents, notices and legal
      proceedings entered into, given or instituted pursuant hereto or relating
      directly or indirectly hereto, be drawn up in English. Les parties
      reconnaissent avoir exigé la rédaction en anglais de la présente
      convention, ainsi que tous documents exécutés, avis donnés et procédures
      judiciaires intentées, directement ou indirectement, relativement à ou
      suite à la présente convention.

THIS SECTION INTENTIONALLY LEFT BLANK

- 43 - 

If the foregoing is in accordance with your understanding and
is agreed to by you, please confirm your acceptance by signing the enclosed
copies of this letter at the place indicated and by returning the same to
Agent’s Counsel. 

ACCEPTED AND AGREED as of the 26th day of
May, 2011. 

MGI SECURITIES INC. 

Per:         /s/ Mark
Arthur 

Name:    Mark Arthur

Title:      Chief Executive Officer 

I have authority to bind the Agent

 

CANYON COPPER CORP. 

Per:         /s/ Tony
Harvey 

Name:    Tony Harvey

Title:      Chairman 

I have authority to bind the
Corporation 

SCHEDULE “A”

Particulars of all Subsidiaries of the
Corporation

•    The Corporation has no Subsidiaries.

- 45 -

SCHEDULE “B”

Particulars of all Common Shares of the Corporation
Reserved for Issuance

The following incentive stock options and warrants are
outstanding and exercisable: 

  	  	Number of Shares 	 Exercise Price 	Expiry Date 
	Stock Options 	625,418 	$0.95 	December 2, 2012 
	  	2,923,000 	$0.13 	August 20, 2014 
	  	  	  	  
	  	  	  	  
	  	  	  	  
	  	  	  	  
	TOTAL 	3,548,418 	  	  
	  	  	  	  
	Warrants 	7,756,984 	$0.08 	June 29, 2011 
	  	1,674,727 	$0.50 	November 10, 2012 
	  	  	  	  
	  	  	  	  
	  	  	  	  
	  	  	  	  
	TOTAL 	9,431,711 	  	  

- 46 - 

SCHEDULE “C” 

Selling Shareholder Form of Declaration and Undertaking
for 

  Resale under Registration Statement *

	TO: 	CANYON COPPER CORP. 
	  	(the “Corporation”) 
	  	 
	FROM: 	THE UNDERSIGNED SHAREHOLDER OF
      THE CORPORATION 
	  	(the “Shareholder”)
  

	RE:        Form S-1
      Registration Statement (the “Registration Statement”) filed by the
      Corporation with the United States Securities and Exchange Commission (the
      “SEC”) pursuant to the United States Securities Act of 1933 (the
      “1933 Act”) 

For good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Shareholder hereby represents,
warrants and agrees as follows with respect to ______________ shares of the
Corporation (the “Unit Shares”), which were acquired by the acceptance of
the Shareholder’s Subscription Agreement by the Corporation the resale of which
have been qualified by the Registration Statement: 

	1. 	
      during the effective period of the Registration
      Statement, the Shareholder will sell the Unit Shares pursuant to the
      provisions of the Registration Statement;

	 	 
	2. 	
      the Shareholder is not an “affiliate” of the Corporation,
      as defined under the 1933 Act, has not been an affiliate of the
      Corporation at any time during the three month period prior to the date of
      this declaration, and the Shareholder agrees that, if the Shareholder
      becomes an affiliate of the Corporation prior to it selling all of the
      Unit Shares, the Shareholder will promptly notify the Corporation in
      writing that it has become an affiliate; and

	 	 
	3. 	
      subsequent to the end of the Effective Period (as defined
      in the Agency Agreement dated •, 2011 between the Corporation and MGI
      Securities Inc.) and if the Shareholder has not sold all of its Unit
      Shares prior to such date and if the Corporation provides the Shareholder
      with written notice from the Corporation that the exemption provided by
      Rule 144 of the 1933 Act is not at that time available for the resale of
      the Unit Shares, the Shareholder agrees to return to the Corporation all
      share certificates representing any of the Unit Shares not sold by the
      Shareholder for endorsement with an appropriate restrictive
  legend.

Dated the _______day of _________________________, _______.

	NAME OF SHAREHOLDER (PLEASE PRINT): 	 
	 	 
	SIGNATURE OF AUTHORIZED SIGNATORY: 	 
	 	 
	NUMBER OF SHARES REGISTERED: 	 

	* 	
      This form of declaration, substantially in the form
      hereof, may be amended as required to apply to the Warrant shares, Agent’s
      Unit Shares and Agent’s Warrant Shares.Eden Energy Corp.: Exhibit 10.28 - Filed by newsfilecorp.com

EDEN ENEGRY CORP. 

2011 STOCK OPTION PLAN

1. STATEMENT OF PURPOSE

1.1 Principal Purposes - The principal purposes of the
Plan are to provide Eden Energy Corp. (“the Company”) with the advantages of the
incentive inherent in share ownership on the part of employees, officers,
directors and consultants responsible for the continued success of the Company;
to create in such individuals a proprietary interest in, and a greater concern
for, the welfare and success of the Company; to encourage such individuals to
remain with the Company; and to attract new employees, officers, directors and
consultants to the Company. 

1.2 Benefit to Shareholders - The Plan is
  expected to benefit shareholders by enabling the Company to attract and retain
  skilled and motivated personnel by offering such personnel an opportunity to
  share in any increase in value of the Shares resulting from their efforts.

2. INTERPRETATION

2.1 Defined Terms - For the purposes of this Plan, the
following terms shall have the following meanings:

	 	(a) 	
      "Act" means the Securities Act of British Columbia
      and Alberta where applicable and as amended from time to time;

	 	 	 	 
	 	(b) 	
      "Associate" shall have the meaning ascribed to
      such term in the applicable Act;

	 	 	 	 
	 	(c) 	
      "Board" means the Board of Directors of the
      Company;

	 	 	 	 
	 	(d) 	
      "Change in Control" means:

	 	 	 	 
	 		(i) 	
      a takeover bid (as defined in the Act), which is
      successful in acquiring Shares,

	 	 	 	 
	 		(ii) 	
      the change of control of the Board resulting from the
      election by the shareholders of the Company of less than a majority of the
      persons nominated for election by management of the Company,

	 	 	 	 
	 		(iii) 	
      the sale of all or substantially all the assets of the
      Company,

	 	 	 	 
	 		(iv) 	
      the sale, exchange or other disposition of a majority of
      the outstanding Shares in a single transaction or series of related
      transactions,

	 	 	 	 
	 		(v) 	
      the dissolution of the Company's business or the
      liquidation of its assets,

	 	 	 	 
	 		(vi) 	
      a merger, amalgamation or arrangement of the Company in a
      transaction or series of transactions in which the Company's shareholders
      receive less than 51% of the outstanding shares of the new or continuing
      corporation, or

1

	 	(vii) 	
      the acquisition, directly or indirectly, through one
      transaction or a series of transactions, by any Person, of an aggregate of
      more than 50% of the outstanding Shares;

	 	(e) 	
      "Committee" means a committee of the Board
      appointed in accordance with this Plan, or if no such committee is
      appointed, the Board itself;

	 	 	 
	 	(f) 	
      "Company" means Eden Energy Corp, a company
      incorporated under the laws of the State of Nevada;

	 	 	 
	 	(g) 	
      "Consultant" means an individual, other than an
      Employee, senior officer or director of the Company or a Subsidiary
      Company, or a Consultant Company, who;

	 	(i) 	
      provides ongoing consulting, technical, management or
      other services to the Company or a Subsidiary Company, other than services
      provided in relation to a distribution of the Company's
  securities,

	 	 	 
	 	(ii) 	
      provides the services under a written contract between
      the Company or a Subsidiary Company and the individual or Consultant
      Company,

	 	 	 
	 	(iii) 	
      in the reasonable opinion of the Company spends or will
      spend a significant amount of time and attention on the affairs and
      business of the Company or a Subsidiary Company, and

	 	 	 
	 	(iv) 	
      has a relationship with the Company or a Subsidiary
      Company that enables the individual or Consultant Company to be
      knowledgeable about the business and affairs of the
  Company;

	 	(h) 	
      "Consultant Company" means, for an individual
      Consultant, a company of which the individual is an employee or
      shareholder, or a partnership of which the individual is an employee or
      partner;

	 	 	 
	 	(i) 	
      "Date of Grant" means the date specified in the
      Option Agreement as the date on which the Option is effectively
      granted;

	 	 	 
	 	(j) 	
      "Disability" means any disability with respect to
      an Optionee which the Board, in its sole and unfettered discretion,
      considers likely to prevent permanently the Optionee
  from:

	 	(i) 	
      being employed or engaged by the Company, a Subsidiary
      Company or another employer, in a position the same as or similar to that
      in which he was last employed or engaged by the Company or a Subsidiary
      Company; or

	 	 	 
	 	(ii) 	
      acting as a director or officer of the Company or a
      Subsidiary Company;

	 	(k) 	
      "Disinterested Shareholder Approval" means an
      ordinary resolution approved by a majority of the votes cast by
      shareholders of the Company at a shareholders'

2

	 		
      meeting, excluding votes attaching to Shares beneficially
      owned by Insiders to whom Options may be granted and Associates of those
      persons;

	 	 	 
	 	(l) 	
      "Effective Date" means the effective date of this
      Plan, which is the later of the day of its approval by the shareholders of
      the Company and the day of its acceptance for filing by the Exchange if
      such acceptance for filing is required under the rules or policies of the
      Exchange;

	 	 	 
	 	(m) 	
      "Eligible Person"
means:

	 	 	
      (i) 
	an Employee, senior officer or director of the Company or
    any Subsidiary Company;
	 	 	 	 
	 		(ii) 	
      a Consultant;

	 	 	 	 
	 		(iii) 	
      an individual providing Investor Relations Activities for
      the Company; or

	 	 	 	 
	 		(iv) 	
      a company, all of the voting securities of which are
      beneficially owned by one or more of the persons referred to in (i), (ii)
      or (iii) above.

	 	(n) 	
      "Employee" means:

	 	 	 	 
	 		(i) 	
      an individual who is considered an employee under the
      Income Tax Act (Canada) (i.e. for whom income tax, employment
      insurance and CPP deductions must be made at source);

	 	 	 	 
	 		(ii) 	
      an individual who works full-time for the Company or a
      Subsidiary Company providing services normally provided by an employee and
      who is subject to the same control and direction by the Company or a
      Subsidiary Company over the details and methods of work as an employee of
      the Company or a Subsidiary Company, but for whom income tax deductions
      are not made at source; or

	 	 	 	 
	 		(iii) 	
      an individual who works for the Company or a Subsidiary
      Company, on a continuing and regular basis for a minimum amount of time
      per week, providing services normally provided by an employee and who is
      subject to the same control and direction by the Company or a Subsidiary
      Company over the details and methods of work as an employee of the Company
      or a Subsidiary Company, but for whom income tax deductions are not made
      at source;

	 	 	 	 
	 	(o) 	
      "Exchange" means the stock exchange or over the
      counter market on which the Shares are listed;

	 	 	 	 
	 	(p) 	
      "Fair Market Value" means, where the Shares are
      listed for trading on an Exchange, the last closing price of the Shares
      before the Date of Grant on the Exchange which is the principal trading
      market for the Shares, as may be determined for such purpose by the
      Committee, provided that, so long as the

3

	 		
      Shares are listed only on the TSXV, the "Fair Market
      Value" shall not be lower than the last closing price of the Shares before
      the Date of Grant less the maximum discount permitted under the policies
      of the TSXV;

	 	 	 
	 	(q) 	
      "Guardian" means the guardian, if any, appointed
      for an Optionee;

	 	 	 
	 	(r) 	
      "Insider" shall have the meaning ascribed to such
      term in the Act;

	 	 	 
	 	(s) 	
      "Investor Relations Activities" means any
      activities or oral or written communications, by or on behalf of the
      Company or a shareholder of the Company that promote or reasonably could
      be expected to promote the purchase or sale of securities of the Company,
      but does not include:

	 	(i) 	
      the dissemination of information provided, or records
      prepared, in the ordinary course of business of the Company:

	 	 	 	 
	 		(A) 	
      to promote the sale of products or services of the
      Company, or

	 	 	 	 
	 		(B) 	
      to raise public awareness of the
  Company,

that cannot reasonably be considered
to promote the purchase or sale of securities of the Company,

	 	(ii) 	
      activities or communications necessary to comply with the
      requirements of:

	 	 	 	 
	 		(A) 	
      applicable securities laws, or

	 	 	 	 
	 		(B) 	
      the rules and policies of the TSXV, if the Shares are
      listed only on the TSXV, or the by-laws, rules or other regulatory
      instruments of any other self-regulatory body or exchange having
      jurisdiction over the Company;

	 	 	 	 
	 	(iii) 	
      communications by a publisher of, or writer for, a
      newspaper, magazine or business or financial publication, that is of
      general and regular paid circulation, distributed only to subscribers to
      it for value or to purchasers of it, if

	 	 	 	 
	 		(A) 	
      the communication is only through the newspaper, magazine
      or publication and

	 	 	 	 
	 		(B) 	
      the publisher or writer receives no commission or other
      consideration other than for acting in the capacity of publisher or
      writer, or

	 	 	 	 
	 	(iv) 	
      activities or communications that may be otherwise
      specified by the TSXV, if the Shares are listed only on the
  TSXV;

	 	(t) 	
      "Option" means a non-transferable and
      non-assignable option to purchase unissued Shares granted pursuant to the
      terms of this Plan;

	 	 	 
	 	(u) 	
      "Option Agreement" means a written agreement
      between the Company and an Optionee specifying the terms of the Option
      being granted to the Optionee under the Plan;

4

		(v) 	
      "Option Price" means the exercise price per Share
      specified in an Option Agreement, adjusted from time to time in accordance
      with the provisions of Sections 6.3 and 10; 

	 	  	
       

	 	(w) 	
      "Optionee" means an Eligible Person to whom an
      Option has been granted; 

	 	  	
       

		(x) 	
      "Person" means a natural person, company,
      government or political subdivision or agency of a government; and where
      two or more Persons act as a partnership, limited partnership, syndicate
      or other group for the purpose of acquiring, holding or disposing of
      securities of an issuer, such syndicate or group shall be deemed to be a
      Person; 

	 	  	
       

	 	(y) 	
      "Plan" means this 2011 Stock Option Plan of the
      Company; 

	 	  	
       

		(z) 	
      "Qualified Successor" means a person who is
      entitled to ownership of an Option upon the death of an Optionee, pursuant
      to a will or the applicable laws of descent and distribution upon death;
      

	 	  	
       

		(aa) 	
      "Shares" means the common shares in the capital of
      the Company as constituted on the Date of Grant, adjusted from time to
      time in accordance with the provisions of Section 10; 

	 	  	
       

		(ab) 	
      "Subsidiary Company" shall mean a company which is
      a subsidiary of the Company; 

	 	  	
       

	 	(ac) 	
      "Term" means the period of time during which an
      Option may be exercised; and 

	 	  	
       

	 	(ad) 	
      "TSXV" means the TSX Venture Exchange.
  

3. ADMINISTRATION

3.1 Board or Committee - The Plan shall be administered
by the Board or by a Committee appointed in accordance with Section 3.2.

3.2 Appointment of Committee - The Board may at any time
appoint a Committee, consisting of not less than three of its members, to
administer the Plan on behalf of the Board in accordance with such terms and
conditions as the Board may prescribe, consistent with this Plan. Once
appointed, the Committee shall continue to serve until otherwise directed by the
Board. From time to time, the Board may increase the size of the Committee and
appoint additional members, remove members (with or without cause) and appoint
new members in their place, fill vacancies however caused, or remove all members
of the Committee and thereafter directly administer the Plan. In the absence of
the appointment of a Committee by the Board, the Board shall administer the
Plan.

3.3 Quorum and Voting - A majority of the members of the
Committee shall constitute a quorum, and, subject to the limitations in this
Section 3, all actions of the Committee shall require the affirmative vote of
members who constitute a majority of such quorum. No member of the Committee who
is a director to whom an Option may be granted may participate in the decision
to grant such Option (but any such member may be counted in determining the 

5

existence of a quorum at any meeting of the Committee in which
action is to be taken with respect to the granting of an Option to him).

3.4 Powers of Board and Committee - The Board shall from
time to time authorize and approve the grant by the Company of Options under
this Plan, and any Committee appointed under Section 3.2 shall have the
authority to review the following matters in relation to the Plan and to make
recommendations thereon to the Board;

	 	(a) 	
      administration of the Plan in accordance with its
      terms,

	 	 	 	 	 
	 	(b) 	
      determination of all questions arising in connection with
      the administration, interpretation and application of the Plan, including
      all questions relating to the value of the Shares,

	 	 	 	 	 
	 	(c) 	
      correction of any defect, supply of any information or
      reconciliation of any inconsistency in the Plan in such manner and to such
      extent as shall be deemed necessary or advisable to carry out the purposes
      of the Plan,

	 	 	 	 	 
	 	(d) 	
      prescription, amendment and rescission of the rules and
      regulations relating to the administration of the Plan;

	 	 	 	 	 
	 	(e) 	
      determination of the duration and purpose of leaves of
      absence from employment which may be granted to Optionees without
      constituting a termination of employment for purposes of the
  Plan;

	 	 	 	 	 
	 	(f) 	
      with respect to the granting of Options:

	 	 	 	 	 
	 		(i) 	
      determination of the employees, officers, directors or
      consultants to whom Options will be granted, based on the eligibility
      criteria set out in this Plan;

	 	 	 	 	 
	 		(ii) 	
      determination of the terms and provisions of the Option
      Agreement which shall be entered into with each Optionee (which need not
      be identical with the terms of any other Option Agreement) and which shall
      not be inconsistent with the terms of this Plan;

	 	 	 	 	 
	 		(iii) 	
      amendment of the terms and provisions of an Option
      Agreement, provided the Board obtains:

	 	 	 	 	 
	 			(A) 	
      the consent of the Optionee, and

	 	 	 	 	 
	 			(B) 	
      if required, the approval of any stock exchange on which
      the Shares are listed,

	 	 	 	 	 
	 		(iv) 	
      determination of when Options will be granted;

	 	 	 	 	 
	 		(v) 	
      determination of the number of Shares subject to each
      Option;

	 	 	 	 	 
	 		(vi) 	
      determination of the vesting schedule, if any, for the
      exercise of each Option; and

	 	 	 	 	 
	 	(g) 	
      other determinations necessary or advisable for
      administration of the Plan.

6

3.5 Obtain Approvals - The Board will seek to obtain any
regulatory, Exchange or shareholder approvals which may be required pursuant to
applicable securities laws or Exchange rules.

3.6 Administration by Committee - The Committee shall
have all powers necessary or appropriate to accomplish its duties under this
Plan. In addition, the Committee's administration of the Plan shall in all
respects be consistent with the Exchange policies and rules.

4. ELIGIBILITY

4.1 Eligibility for Options - Options may be granted to
any Eligible Person.

4.2 Insider Eligibility for Options - Notwithstanding
Section 4.1, if the Shares are listed only on the TSXV, grants of Options to
Insiders shall be subject to the policies of the TSXV.

4.3 No Violation of Securities Laws - No Option shall be
granted to any Optionee unless the Committee has determined that the grant of
such Option and the exercise thereof by the Optionee will not violate the
securities law of the jurisdiction in which the Optionee resides.

5. SHARES SUBJECT TO THE PLAN

5.1 Number of Shares - The aggregate number of Shares
reserved for issuance under this Plan or any other plan of the Corporation,
shall be 395,778 Shares.

5.2 Expiration of Option - If an Option expires or
terminates for any reason without having been exercised in full, the unpurchased
Shares subject thereto shall again be available for the purposes of the
Plan.

5.3 Reservation of Shares - The Company will at all
times reserve for issuance and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.

6. OPTION TERMS

6.1 Option Agreement - Each Option granted to an
Optionee shall be confirmed by the execution and delivery of an Option Agreement
and the Board shall specify the following terms in each such Option
Agreement:

	 	(a) 	
      the number of Shares subject to option pursuant to such
      Option, subject to the following limitations if the Shares are listed only
      on the TSXV:

	 	 	 	 
	 		(i) 	
      the number of Shares issuable to any one Optionee. within
      a 12 month period, as a result of a grant of Options shall not exceed 5%
      of the issued Shares unless the Company has obtained Disinterested
      Shareholder Approval to exceed this number;

	 	 	 	 
	 		(ii) 	
      the grant to Insiders, within a 12 month period, of a
      number of Options exceeding 10% of the issued Shares, unless the Company
      has obtained Disinterested Shareholder Approval to exceed this
    number;

7

	 	(iii) 	
      the number of Shares reserved for issuance pursuant to
      Options to Insiders shall not exceed 10% of the issued Shares at any time,
      unless the Company has obtained Disinterested Shareholder Approval to
      exceed this number;

	 	 	 
	 	(iv) 	
      the number of Shares reserved for issuance pursuant to
      Options to any one Consultant shall not exceed 2% of the issued Shares in
      any 12-month period, and

	 	 	 
	 	(v) 	
      the aggregate number of Shares reserved for issuance
      pursuant to Options to those individuals conducting Investor Relations
      Activities shall not exceed 2% of the issued Shares in any 12-month
      period;

	 	(b) 	
      the Date of Grant;

	 	 	 
	 	(c) 	
      the Term, provided that, if the Shares are listed only on
      the TSXV, the length of the Term shall in no event be greater than ten
      years following the Date of Grant, for all Optionees;

	 	 	 
	 	(d) 	
      the Option Price, provided that the Option Price shall
      not be less than the Fair Market Value of the Shares on the Date of
      Grant;

	 	 	 
	 	(e) 	
      subject to Section 6.2 below, any vesting schedule upon
      which the exercise of an Option is contingent;

	 	 	 
	 	(f) 	
      if the Optionee is an Employee, Consultant or an
      individual providing Investor Relations Activities for the Company, a
      representation by the Company and the Optionee that the Optionee is a bona
      fide Employee, Consultant or an individual providing Investor Relations
      Activities for the Company, as the case may be, of the Company or a
      Subsidiary Company; and

	 	 	 
	 	(g) 	
      such other terms and conditions as the Board deems
      advisable and are consistent with the purposes of this
  Plan.

6.2 Vesting Schedule - The Board, as applicable, shall
have complete discretion to set the terms of any vesting schedule of each Option
granted, including, without limitation, discretion to:

	 	(a) 	
      permit partial vesting in stated percentage amounts based
      on the Term of such Option;

	 	 	 
	 	(b) 	
      permit full vesting after a stated period of time has
      passed from the Date of Grant and;

	 	 	 
	 	(c) 	
      the vesting schedule shall in all circumstances comply
      with the requirements set out in TSX Listings Policy 4.4 Paragraphs 2.3
      (b) 3(3.3).

6.3 Amendments to Options - Amendments to the terms of
previously granted Options are subject to regulatory approval, if required. If
required by the Exchange, Disinterested Shareholder Approval shall be required
for any reduction in the Option Price of a previously 

8

granted Option if the Optionee is an Insider of the Company at
the time of the proposed reduction in the Option Price.

6.4 Uniformity - Except as expressly provided
herein, nothing contained in this Plan shall require that the terms and
conditions of Options granted under the Plan be uniform.

7. EXERCISE OF OPTION

7.1 Method of Exercise - Subject to any limitations or
conditions imposed upon an Optionee pursuant to the Option Agreement or Section
6 hereof, an Optionee may exercise an Option by giving written notice thereof,
specifying the number of Shares in respect of which the Option is exercised, to
the Company at its principal place of business at any time after the Date of
Grant until 4:00 p.m. (Central time) on the last day of the Term, such notice to
be accompanied by full payment of the aggregate Option Price to the extent the
Option is so exercised. Such payment shall be in lawful money (Canadian funds or
the equivalent in U.S. funds) by cash, certififed check, bank draft or wire
transfer. Payment by certified check made payable to the Company in the amount
of the aggregate Option Price shall constitute payment of such Option Price
unless the check is not honored upon presentation, in which case the Option
shall not have been validly exercised.

7.2 Issuance of Certificates - Not later than the third
business day after exercise of an Option in accordance with Section 7.1, the
Company shall issue and deliver to the Optionee a certificate or certificates
evidencing the Shares with respect to which the Option has been exercised. Until
the issuance of such certificate or certificates, no right to vote or receive
dividends or any other rights as a shareholder shall exist with respect to such
Shares, notwithstanding the exercise of the Option. No adjustment will be made
for a dividend or other right for which the record date is prior to the date the
certificate is issued, except as provided by Section 10 hereof.

7.3 Compliance with U.S. Securities Laws - As a
condition to the exercise of an Option, the Board may require the Optionee to
represent and warrant in writing at the time of such exercise that the Shares
are being purchased only for investment and without any then-present intention
to sell or distribute such Shares. At the option of the Board, a stop transfer
order against such Shares may be placed on the stock books and records of the
Company and a legend, indicating that the stock may not be pledged, sold or
otherwise transferred unless an opinion of counsel is provided stating that such
transfer is not in violation of any applicable law or regulation, may be stamped
on the certificates representing such Shares in order to assure an exemption
from registration. The Board may also require such other documentation as may
from time to time be necessary to comply with United States federal and state
securities laws. The Company has no obligation to undertake registration of
Options or the Shares issuable upon the exercise of the Options.

8. TRANSFERABILITY OF OPTIONS

8.1 Non-Transferable/Legending - Except as permitted by
applicable securities laws and the policies of the Exchange, and as provided
otherwise in this Section 8, Options are non-assignable and non-transferable. If
the Shares are listed only on the TSXV, then, in addition to any resale
restrictions under applicable securities laws, the Option Agreement and the
certificates representing the Shares issued on the exercise of such Option shall
bear a legend with a four-

9

month hold period commencing on the Date of Grant in accordance
with applicable securities laws.

8.2 Death of Optionee - Subject to Section 8.3, if the
employment of an Optionee as an Employee of, or the services of a Consultant
providing services to, the Company or any Subsidiary Company, or the employment
of an Optionee as an individual providing Investor Relations Activities, or the
position of the Optionee as a director or senior officer of the Company or any
Subsidiary Company, terminates as a result of such Optionee's death, any Options
held by such Optionee shall pass to the Qualified Successor of the Optionee and
shall be exercisable by such Qualified Successor until the earlier of a period
of not more than one year following the date of such death and the expiry of the
Term of the Option.

8.3 Disability of Optionee - If the employment of an
Optionee as an Employee of, or the services of a Consultant providing services
to, the Company or any Subsidiary Company, or the employment of an Optionee as
an individual providing Investor Relations Activities for the Company, or the
position of the Optionee as a director or senior officer of the Company or any
Subsidiary Company, is terminated by reason of such Optionee's Disability, any
Options held by such Optionee that could have been exercised immediately prior
to such termination of employment or service shall be exercisable by such
Optionee, or by his Guardian, for a period of 30 days following the termination
of employment or service of such Optionee. If such Optionee dies within that
30-day period, any Option held by such Optionee that could have been exercised
immediately prior to his or her death shall pass to the Qualified Successor of
such Optionee, and shall be exercisable by the Qualified Successor until the
earlier of a period of 30 days following the death of such Optionee and the
expiry of the Term of the Option.

8.4 Deemed Non-Interruption of Employment - Employment
shall be deemed to continue intact during any military or sick leave or other
bona fide leave of absence if the period of such leave does not exceed 90 days
or, if longer, for so long as the Optionee's right to reemployment with the
Company or any Subsidiary Company is guaranteed either by statute or by
contract. If the period of such leave exceeds 90 days and the Optionee's
reemployment is not so guaranteed, then the Optionee's employment shall be
deemed to have terminated on the ninety-first day of such leave.

9. TERMINATION OF OPTIONS

9.1 Termination of Options - To the extent not earlier
exercised or terminated in accordance with Section 8, an Option shall terminate
at the earliest of the following dates:

	 	(a) 	
      the termination date specified for such Option in the
      Option Agreement;

	 	 	 
	 	(b) 	
      where the Optionee's position as an Employee, a
      Consultant, a director or a senior officer of the Company or any
      Subsidiary Company, or an individual providing Investor Relations
      Activities for the Company, is terminated for cause, the date of such
      termination for cause;

	 	 	 
	 	(c) 	
      where the Optionee's position as an Employee, a
      Consultant, a director or a senior officer of the Company or any
      Subsidiary Company or an individual providing

10

		
      Investor Relations Activities for the Company terminates
      for a reason other than the Optionee's Disability or death or for cause,
      not more than 90 days after such date of termination or, if the Shares are
      listed only on the TSXV and if the Company is designated as a "Tier 2"
      listed company by the TSXV, then in the case of a person employed to
      provide Investor Relations Activities, not more than 30 days after such
      person ceases to be employed to provide Investor Relations Activities;
      PROVIDED that if an Optionee's position changes from one of the said
      categories to another category, such change shall not constitute
      termination or cessation for the purpose of this Subsection 9.1(c);
    and

	 	 
	(d) 	
      the date of any sale, transfer, assignment or
      hypothecation, or any attempted sale, transfer, assignment or
      hypothecation, of such Option in violation of Section
  8.1.

9.2 Lapsed Options - If Options are surrendered,
terminate or expire without being exercised in whole or in part, new Options may
be granted covering the Shares not purchased under such lapsed Options. If an
Option has been surrendered in connection with the regranting of a new Option to
the same Optionee on different terms than the original Option granted to such
Optionee, then, if required, the new Option is subject to approval of the
Exchange.

9.3 Exclusion From Severance Allowance, Retirement
Allowance or Termination Settlement - If the Optionee retires,
resigns or is terminated from employment or engagement with the Company or any
Subsidiary Company, the loss or limitation, if any, pursuant to the Option
Agreement with respect to the right to purchase Option Shares which were not
vested at that time or which, if vested, were cancelled, shall not give rise to
any right to damages and shall not be included in the calculation of nor form
any part of any severance allowance, retiring allowance or termination
settlement of any kind whatsoever in respect of such Optionee.

10. ADJUSTMENTS TO OPTIONS

10.1 Alteration in Capital Structure - If there is any
change in the Shares through or by means of a declaration of stock dividends of
the Shares or consolidations, subdivisions or reclassifications of the Shares,
or otherwise, the number of Shares available under the Plan, the Shares subject
to any Option and the Option Price therefor shall be adjusted proportionately by
the Board and, if required, approved by the Exchange, and such adjustment shall
be effective and binding for all purposes of the Plan.

10.2 Effect of Amalgamation, Merger or Arrangement - If
the Company amalgamates, merges or enters into a plan of arrangement with or
into another corporation, any Shares receivable on the exercise of an Option
shall be converted into the securities, property or cash which the Optionee
would have received upon such amalgamation, merger or arrangement if the
Optionee had exercised the Option immediately prior to the record date
applicable to such amalgamation, merger or arrangement, and the exercise price
shall be adjusted proportionately by the Board and such adjustment shall be
binding for all purposes of the Plan.

10.3 Acceleration on Change in Control - Upon a Change
in Control, all Options shall become immediately exercisable, notwithstanding
any contingent vesting provisions to which such Options may have otherwise been
subject.

11

10.4 Acceleration of Date of Exercise - Subject to the
approval of the Exchange, if required, the Board shall have the right to
accelerate the date of vesting of any portion of any Option which remains
unvested.

10.5 Determinations to be Binding - If any questions
arise at any time with respect to the Option Price or exercise price or number
of Option Shares or other property deliverable upon exercise of an Option
following an event referred to in this Section 10, such questions shall be
conclusively determined by the Board, whose decisions shall be final and
binding.

10.6 Effect of a Take-Over - If a bona fide offer
(the "Offer") for Shares is made to an Optionee or to shareholders generally or
to a class of shareholders which includes the Optionee, which Offer constitutes
a take-over bid within the meaning of the Act, the Company shall, immediately
upon receipt of notice of the Offer, notify each Optionee of full particulars of
the Offer, whereupon any Option held by an Optionee may be exercised in whole or
in part, notwithstanding any contingent vesting provisions to which such Options
may have otherwise been subject, by the Optionee so as to permit the Optionee to
tender the Shares received upon such exercise (the "Optioned Shares") to the
Offer. If

	 	(a) 	
      the Offer is not completed within the time specified
      therein; or

	 	 	 
	 	(b) 	
      all of the Optioned Shares tendered by the Optionee
      pursuant to the Offer are not taken up and paid for by the offeror
      pursuant thereto;

the Optioned Shares or, in the case of clause (b) above, the
Optioned Shares that are not taken up and paid for, may be returned by the
Optionee to the Company and reinstated as authorized but unissued Shares and
with respect to such returned Optioned Shares, the Option shall be reinstated as
if it had not been exercised. If any Optioned Shares are returned to the Company
under this Section, the Company shall refund to the Optionee any Option Price
paid for such Optioned Shares.

11. APPROVAL, TERMINATION AND AMENDMENT OF PLAN

11.1 Shareholder Approval - This Plan, if the Shares are
listed only on the TSXV, must receive shareholder approval at a meeting of the
Company's shareholders at the time the Plan implemented and at such time the
number of Shares reserved for issuance under the Plan is amended.

11.2 Power of Board to Terminate or Amend Plan - Subject
to the approval of the Exchange, if required, the Board may terminate, suspend
or discontinue the Plan at any time or amend or revise the terms of the Plan;
provided, however, that, except as provided in Section 10, the Board may not do
any of the following without obtaining, within 12 months either before or after
the Board's adoption of a resolution authorizing such action, approval by the
Company's shareholders at a meeting duly held in accordance with the applicable
corporate laws:

	 	(a) 	
      increase the maximum number of Shares which may be issued
      under the Plan;

	 	 	 
	 	(b) 	
      materially modify the requirements as to eligibility for
      participation in the Plan; or

	 	 	 
	 	(c) 	
      materially increase the benefits accruing to participants
      under the Plan;

12

however, the Board may amend the terms of the Plan to comply
with the requirements of any applicable regulatory authority, or as a result of
changes in the policies of the Exchange relating to director, officer and
employee stock options, without obtaining the approval of the Company's
shareholders.

11.3 No Grant During Suspension of Plan - No Option may
be granted during any suspension, or after termination, of the Plan. Amendment,
suspension or termination of the Plan shall not, without the consent of the
Optionee, alter or impair any rights or obligations under any Option previously
granted.

12. CONDITIONS PRECEDENT TO ISSUANCE OF SHARES

12.1 Compliance with Laws - Shares shall not be issued
with respect to an Option unless the exercise of such Option and the issuance
and delivery of such shares shall comply with all relevant provisions of law,
including, without limitation, any applicable United States state securities
laws, the Securities Act of 1933, as amended, the rules and regulations
thereunder and the requirements of any Exchange or automated interdealer
quotation system of a registered national securities association upon which such
Shares may then be listed or quoted, and such issuance shall be further subject
to the approval of counsel for the Company with respect to such compliance,
including the availability of an exemption from registration for the issuance
and sale of such Shares. The inability of the Company to obtain from any
regulatory body the authority deemed by the Company to be necessary for the
lawful issuance and sale of any Shares under this Plan, or the unavailability of
an exemption from registration for the issuance and sale of any Shares under
this Plan, shall relieve the Company of any liability with respect to the
non-issuance or sale of such Shares other than with respect to a refund of any
Option Price paid.

13. USE OF PROCEEDS

13.1 Use of Proceeds - Proceeds from the sale of Shares
pursuant to the Options granted and exercised under the Plan shall constitute
general funds of the Company and shall be used for general corporate purposes,
or as the Board otherwise determines.

14. NOTICES

14.1 Notices - All notices, requests, demands and
other communications required or permitted to be given under this Plan and the
Options granted under this Plan shall be in writing and shall be either
delivered personally to the party to whom notice is to be given, in which case
notice shall be deemed to have been duly given on the date of such personal
delivery; telecopied, in which case notice shall be deemed to have been duly
given on the date the telecopy is sent; or mailed to the party to whom notice is
to be given, by first class mail, registered or certified, return receipt
requested, postage prepaid, and addressed to the party at his or its most recent
known address, in which case such notice shall be deemed to have been duly given
on the tenth postal delivery day following the date of such mailing.

15. MISCELLANEOUS PROVISIONS

15.1 No Obligations to Exercise - Optionees shall be
under no obligation to exercise Options granted under this Plan.

13

15.2 No Obligation to Retain Optionee - Nothing
contained in this Plan shall obligate the Company or any Subsidiary Company to
retain an Optionee as an employee, officer, director or consultant for any
period, nor shall this Plan interfere in any way with the right of the Company
or any Subsidiary Company to reduce such Optionee's compensation.

15.3 Binding Agreement - The provisions of this Plan and
of each Option Agreement with an Optionee shall be binding upon such Optionee
and the Qualified Successor or Guardian of such Optionee.

15.4 Use of Terms - Where the context so requires,
references herein to the singular shall include the plural, and vice versa, and
references to a particular gender shall include either or both genders.

15.5 Headings - The headings used in this Plan
are for convenience of reference only and shall not in any way affect or be used
in interpreting any of the provisions of this Plan.

15.6 No Representation or Warranty - The Company makes
no representation or warranty as to the future value of any Shares issued in
accordance with the provisions of this Plan.

15.7 Income Taxes - As a condition of and prior to
participation in the Plan any Optionee shall on request authorize the Company in
writing to withhold from any remuneration otherwise payable to such Optionee any
amounts required by any taxing authority to be withheld for taxes of any kind as
a consequence of such Optionee's participation in the Plan.

15.8 Compliance with Applicable Law - If any provision
of the Plan or any Option Agreement contravenes any law or any order, policy,
by-law or regulation of any regulatory body or stock exchange or over the
counter market having authority over the Company or the Plan, then such
provision shall be deemed to be amended to the extent required to bring such
provision into compliance therewith.

15.9 Conflict - In the event of any conflict
between the provisions of this Plan and an Option Agreement, the provisions of
this Plan shall govern.

15.10 Governing Law - This Plan and each Option
Agreement issued pursuant to this Plan shall be governed by the laws of the
Province of British Columbia.

15.11 Time of Essence - Time is of the essence of this
Plan and of each Option Agreement. No extension of time will be deemed to be, or
to operate as, a waiver of the essentiality of time.

15.12 Entire Agreement - This Plan and the Option
Agreement sets out the entire agreement between the Company and the Optionees
relative to the subject matter hereof and supersedes all prior stock option
plans, agreements, undertakings and understandings, whether oral or written.

14

16. EFFECTIVE DATE OF PLAN

16.1 Effective Date of Plan - This Plan shall be
effective on the later of the day of its approval by the shareholders of the
Company given by way of ordinary resolution at a meeting of shareholders and the
day of its acceptance for filing by the Exchange and until the requisite
shareholder approval has been obtained, no Options shall be exercised.

Approved and adopted by the Board of Directors as of the
17th day of May, 2011.

15

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