Document:

Exhibit 10.15

 

RISE
GOLD CORP.

(the
“Corporation”)

 

PRIVATE
PLACEMENT SUBSCRIPTION AGREEMENT

WITH
U.S. REGISTRATION RIGHTS

 

(FOR
COMPLETION BY U.S. SUBSCRIBERS)

 

The
undersigned subscriber (the “Subscriber”) hereby irrevocably subscribes for and agrees to purchase 17,500,000
Units of the Corporation (the “Units”) at a price of $0.10 per Unit for aggregate proceeds of $1,750,000 (the
“Funds”), all upon the terms and subject to the conditions set forth in this subscription agreement (this “Agreement”).
Each Unit shall be comprised of one Unit Share (as defined herein) and one-half of one Warrant (as defined herein). Each Warrant
shall be exercisable to acquire one Warrant Share (as defined herein) at a price of $0.13 per share for a period of two years
from the Closing Date (as defined herein).

 

	 	EXECUTION BY SUBSCRIBER	 
	 	 	 
	 	 	 	Meridian Jerritt Canyon Corp.	 
	 	 	 	Name of Subscriber	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	Address of Subscriber	 
	 	ID number (SIN, SSN, Tax ID or driver’s license) of Subscriber or authorized signatory (if
    Subscriber not an individual)	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	Name of authorized signatory (if Subscriber not an individual)	 
	 	Signature of Subscriber or authorized signatory (if Subscriber not an individual)	 	 	 
	 	 	 	 	 
	 	 	 	Telephone number of Subscriber	 
	 	Number and type of securities of the Corporation directly and indirectly already held by Subscriber	 	 	 
	 	 	 	Email address of Subscriber	 

 

Executed
by the Subscriber this 15th day of October, 2018.

 

Please
complete the following section if you require the certificate(s) representing the Unit Shares and Warrants to appear in the name
of an intermediary, such as your broker, or require such certificate(s) to be delivered to an address other than that shown above.

 

	REGISTRATION
    INSTRUCTIONS	 	DELIVERY
    INSTRUCTIONS
	 	 	 
	 	 	 
	Name
    to appear on certificate(s)	 	Name
    and account reference, if applicable
	 	 	 
	 	 	 
	Account
    reference, if applicable	 	Contact
    person
	 	 	 
	 	 	 
	Address
    of intermediary	 	Address
    for delivery
	 	 	 
	 	 	 
	 	 	 
	Telephone
    number of intermediary	 	Telephone
    number of contact person

    - 1 -

     

    

If
the Subscriber is purchasing as agent for a principal, and is not a trust company or trust corporation purchasing as trustee or
agent for accounts fully managed by it or is not a person acting on behalf of an account fully managed by it (and in each such
case satisfying the criteria set forth in NI 45-106), complete the box below and provide as a separate attachment all applicable
Forms on behalf of such principal:

 

	IDENTIFICATION
    OF PRINCIPAL
	 	 	 
	 	 	 
	 	(name of Disclosed Principal)	 
	 	 	 
	 	 	 
	  	(address of Disclosed Principal – include city, province, and postal code)	 
	 	 	 
	 	 	 
	  	(Disclosed Principal: contact name, contact telephone number and contact email address)
	 	 

 

Accepted
by the Corporation this 18 day of October, 2018.

 

	Per:	 	 
	 	Authorized Signatory	 

 

    - 2 -

     

    

Section
1. Defined Terms

 

In
addition to the terms defined throughout this Agreement, the following capitalized terms used in this Agreement have the following
meanings:

 

		(a)	“Accredited
                                         Investor” means an “accredited investor” as that term is defined
                                         in NI 45-106 and “U.S. Accredited Investor” means an “accredited
                                         investor” as that term is defined in Rule 501(a) of Regulation D;

 

		(b)	“Affiliate”
                                         has the meaning ascribed to such term in the Business Corporations Act (British
                                         Columbia), as in effect on the date of this Agreement;

 

		(c)	“Agreement”
                                         means this subscription agreement (including the schedules hereto) and any instrument
                                         amending this Agreement; “hereof”, “hereto”, “hereunder”,
                                         “herein” and similar expressions mean and refer to this Agreement and not
                                         to a particular section or clause; and the expression “section” or “clause”
                                         followed by a number or letter means and refers to the specified section or clause of
                                         this Agreement;

 

		(d)	“Applicable
                                         Securities Laws” means the securities legislation and regulation of, and the
                                         instruments, policies, rules, orders, and notices of, the applicable securities regulatory
                                         authority or authorities of the applicable jurisdiction or jurisdictions as the case
                                         may be and all rules and policies of the CSE;

 

		(e)	“Associate”
                                         has the meaning ascribed to such term in the Securities Act (British Columbia),
                                         as in effect on the date of this Agreement;

 

		(f)	“Board”
                                         means the board of directors of the Corporation;

 

		(g)	“Business”
                                         means the current business and operations of the Corporation as described in the Public
                                         Record and the anticipated exploration, development and mining operations of the Corporation;

 

		(h)	“Business
                                         Day” means a day other than a Saturday, Sunday or a holiday on which principal
                                         chartered banks located in Vancouver, British Columbia or Toronto, Ontario are not open
                                         for business;

 

		(i)	“Closing”
                                         means the closing of the transactions contemplated by this Agreement;

 

		(j)	“Closing
                                         Date” means the date or dates of completion of the sale of Units under the
                                         Offering as may be determined by the Corporation;

 

		(k)	“Contract”
                                         means any agreement, indenture, contract, lease, deed of trust, licence, option, instrument,
                                         arrangement, understanding or other commitment, whether written or oral;

 

		(l)	“CSE”
                                         means the Canadian Securities Exchange;

 

		(m)	“Current
                                         Financing” means the private placement offering by the Corporation of up to
                                         25,000,000 Units for gross proceeds of $2,500,000 (inclusive of the Offering), which
                                         may close in one or more tranches;

 

		(n)	“Disclosed
                                         Principal” means a purchaser that is purchasing the Units through an agent
                                         or trustee for beneficial principal(s);

 

		(o)	“Disclosure
                                         Schedule” means the disclosure schedule of the Corporation attached as Schedule D
                                         hereto;

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		(p)	“Encumbrance”
                                         means any encumbrance, lien, charge, hypothec, pledge, mortgage, title retention agreement,
                                         security interest of any nature, adverse interest, adverse claim, exception, reservation,
                                         easement, right of occupation, any matter capable of registration against title, option,
                                         right of pre-emption, privilege, other third party interest or any Contract to create
                                         any of the foregoing;

 

		(q)	“Environmental
                                         Laws” means all applicable Laws relating to the protection of the environment,
                                         natural resources, human health and safety, Hazardous Substances, the assessment of environmental
                                         and social impacts or the rehabilitation, reclamation and closure of lands used in connection
                                         with the Business;

 

		(r)	“Equity
                                         Financing” has the meaning set out on page 12 of this Agreement;

 

		(s)	“Equity
                                         Financing Notice” has the meaning set out on page 13 of this Agreement;

 

		(t)	“Equity
                                         Securities” has the meaning set out on page 12 of this Agreement;

 

		(u)	“Financial
                                         Statements” means the audited consolidated financial statements of the Corporation
                                         for the year ended July 31, 2017 and the unaudited condensed consolidated financial statements
                                         of the Corporation for the fiscal quarter ended April 30, 2018;

 

		(v)	“Funds”
                                         has the meaning set out on the face page of this Agreement;

 

		(w)	“Governmental
                                         Entity” means any domestic or foreign federal, provincial, regional, state,
                                         municipal or other government, governmental department, agency, authority or body (whether
                                         administrative, legislative, executive or otherwise), court, tribunal, commission or
                                         commissioner, bureau, minister or ministry, board or agency, or other regulatory authority,
                                         including any securities regulatory authorities and the CSE;

 

		(x)	“Hazardous
                                         Substances” means any substance, material or waste that is defined, regulated,
                                         listed or prohibited by Environmental Laws, including pollutants, contaminants, chemicals,
                                         deleterious substances, dangerous goods, hazardous or industrial toxic wastes or substances,
                                         tailings, wasterock, radioactive materials, flammable substances, explosives, petroleum
                                         and petroleum products, polychlorinated biphenyls, chlorinated solvents and asbestos;

 

		(y)	“International
                                         Jurisdiction” means the jurisdiction in which the Subscriber resides, if such
                                         jurisdiction is outside of Canada or the United States;

 

		(z)	“Laws”
                                         means any and all federal, provincial, regional, local, municipal or other law, statute,
                                         constitution, principle of common law, resolution, ordinance, proclamation, directive,
                                         order, rule, regulation, ruling or requirement issued, enacted, adopted, promulgated,
                                         implemented or otherwise put into effect by or under the authority of any Governmental
                                         Entity;

 

		(aa)	“Material
                                         Adverse Effect” means an effect that is material and adverse to the Business,
                                         affairs, capital, operations, properties, assets, liabilities (contingent or otherwise)
                                         or condition (financial or otherwise) of the Corporation and its Subsidiary, on a consolidated
                                         basis;

 

		(bb)	“Mineral
                                         Rights” has the meaning set out in section 10(u)(i) of this Agreement;

 

		(cc)	“NI
                                         43-101” means National Instrument 43-101 – Standards of Disclosure
                                         for Mineral Projects;

 

		(dd)	“NI
                                         45-106” means National Instrument 45-106 – Prospectus Exemptions;

 

		(ee)	“Offering”
                                         means the private placement offering of 17,500,000 Units for gross proceeds of $1,750,000
                                         to the Subscriber pursuant to this Agreement;

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		(ff)	“Offer
                                         Rejection Date” means the date any of the events described in subsection 16(b)(i)
                                         or (ii) or subsection 16(d)(i) or (ii) occurs;

 

		(gg)	“Outstanding
                                         Equity Securities” means the number of the Shares issued and outstanding at
                                         a particular time on a fully diluted basis;

 

		(hh)	“Parties”
                                         means, collectively, the Subscriber and the Corporation and “Party”
                                         means any one of them, as the context requires;

 

		(ii)	“Percentage
                                         Equity Ownership Interest” has the meaning set out in section 13(f);

 

		(jj)	“Permit”
                                         means any permit, lease, licence, claim, certificate, order, grant, approval, consent,
                                         registration, closure plan or other authorization of or from any Governmental Entity
                                         and includes any permit necessary to explore for, exploit, develop, mine, produce or
                                         refine minerals;

 

		(kk)	“Post
                                         Closing Options” has the meaning set out in section 13(b);

 

		(ll)	“Public
                                         Record” refers to all public information which has been filed by the Corporation
                                         pursuant to Applicable Securities Laws;

 

		(mm)	“Project”
                                         means the Corporation’s Idaho-Maryland project located in Grass Valley, California;

 

		(nn)	“Regulation
                                         D” means Regulation D promulgated under the U.S. Securities Act;

 

		(oo)	“Regulation
                                         S” means Regulation S promulgated under the U.S. Securities Act;

 

		(pp)	“Reporting
                                         Jurisdictions” means, collectively, British Columbia, Alberta and Ontario;

 

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

 

		(rr)	“Securities”
                                         means collectively, the Units, Unit Shares, Warrants and Warrant Shares;

 

		(ss)	“Securities
                                         Regulators” means, collectively, the securities regulators or other securities
                                         regulatory authorities in the Reporting Jurisdictions;

 

		(tt)	“Shareholders”
                                         means holders of Shares;

 

		(uu)	“Shares”
                                         means the shares of common stock of the Corporation;

 

		(vv)	“Subscriber”
                                         means the subscriber for Units as set out on page 1 of this Agreement and includes Yamana
                                         and, as applicable, the Disclosed Principal unless the context otherwise requires;

 

		(ww)	“Subsidiary”
                                         means Rise Grass Valley Inc.;

 

		(xx)	“Tax”
                                         or “Taxes” means any federal, provincial, territorial, state or local
                                         income, goods and services, value added, corporation, land transfer, licence, payroll,
                                         excise, sales, use, capital, withholding, mining or other tax, levy, duty, royalty, assessment,
                                         reassessment or other charge of any kind whatsoever, whether direct or indirect, including
                                         any interest or penalty on any of the foregoing, whether disputed or not, and for greater
                                         certainty includes pension plan premiums and employment insurance premiums;

 

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

 

		(zz)	“Tax
Return” means any return, report, declaration, designation, election, notice, filing, form, claim for refund, information
return or other document (including any related or supporting

    - 5 -

     

    

schedule, statement or information) filed or required to be filed in connection
                                         with the determination, assessment or collection of any Tax or the administration of
                                         any Laws, regulations or administrative requirements relating to any Tax; 

 

		(aaa)	“Technical
                                         Report” means the technical report prepared by Greg Kulla, PGeo., of Amec Foster
                                         Wheeler Americas Limited, in accordance with NI 43-101 entitled “Technical Report
                                         on the Idaho-Maryland Project, Grass Valley, California, USA” dated effective June
                                         1, 2017;

 

		(bbb)	“Term
                                         Sheet” means the term sheet dated October 16, 2018, entered into by the Corporation
                                         and the Subscriber with respect to the Offering;

 

		(ccc)	“United
                                         States” means the United States of America, its territories and possessions,
                                         any state of the United States, and the District of Columbia;

 

		(ddd)	“Units”
                                         has the meaning set out on the face page of this Agreement;

 

		(eee)	“Unit
                                         Shares” means the Shares comprising part of the Units;

 

		(fff)	“U.S.
                                         Person” means a “U.S. person” as that term is defined in Regulation
                                         S;

 

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

 

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

 

		(iii)	“Warrants”
                                         means the share purchase warrants of the Corporation comprising part of the Units, each
                                         of which entitles the holder thereof to acquire one Warrant Share at an exercise price
                                         of $0.13 per Share until the date which is two years from the Closing Date;

 

		(jjj)	“Warrant
                                         Shares” means the Shares issuable upon due exercise of the Warrants; and

 

		(kkk)	“Yamana”
                                         means Yamana Gold Inc.

 

Section
2. Delivery of Documents and Funds

 

The
Subscriber hereby delivers to the Corporation:

 

		(a)	A
                                         completed and executed copy of this Agreement;

 

		(b)	A
                                         completed and executed Investor Exemptions Certificate in the form attached hereto as
                                         Schedule “A” (including any applicable forms), and in the case of a subscription
                                         for the Units by the Subscriber acting as trustee or agent, an Investor Exemptions Certificate
                                         in the form attached hereto as Schedule “A” for each trust, beneficial purchaser
                                         and/or principal for which the Subscriber is acting as trustee or agent;

 

		(c)	A
                                         completed and executed U.S. Accredited Investor Certificate in the form attached hereto
                                         as Schedule “B”, and in the case of a subscription for the Unit Shares
                                         by the Subscriber acting as trustee or agent, a U.S. Accredited Investor Certificate
                                         in the form attached hereto as Schedule “B” for each trust, beneficial
                                         purchaser and/or principal for which the Subscriber is acting as trustee or agent;

 

		(d)	A
                                         completed and executed Selling Stockholder Notice and Questionnaire in the form attached
                                         hereto as Exhibit 1 to Schedule “D”, if applicable; and

 

		(e)	A
                                         certified cheque, bank draft or money order for the Funds made payable to the Corporation
                                         or evidence of a wire transfer sent to the bank account designated by the Corporation
                                         as set out in Schedule “C”.

    - 6 -

     

    

Section
3. Closing

 

The
Closing will take place once the subscription is received by the Corporation, subject to the approval by the Corporation of the
subscription. As soon as practicable after the Closing, the Corporation will deliver to the Subscriber certificates representing
the Unit Shares and the Warrants subscribed for hereunder registered in the name of the Subscriber or as directed on page 1 of
this Agreement.

 

Section
4. Acknowledgements of the Subscriber

 

The
Subscriber acknowledges and agrees with the Corporation that:

 

		(a)	This
                                         subscription is subject to rejection or allotment by the Corporation in whole or in part;

 

		(b)	The
                                         Corporation may complete additional financings in the future which may have a dilutive
                                         effect on existing stockholders at such time, including the Subscriber, subject to the
                                         additional purchase rights granted to the Subscriber herein;

 

		(c)	No
                                         agency, governmental authority, regulatory body, stock exchange or other entity has made
                                         any finding or determination as to the merit for investment of, nor has any such agency,
                                         governmental authority, regulatory body, stock exchange or other entity made any recommendation
                                         or endorsement with respect to, the Securities;

 

		(d)	The
                                         sale and delivery of the Units is conditional upon such sale being exempt from the registration
                                         and prospectus filing requirements in connection with the distribution of the Units under
                                         Applicable Securities Laws or upon the issuance of such orders, consents or approvals
                                         as may be required to permit such sale without the requirement of filing a prospectus;

 

		(e)	The
                                         Securities are subject to resale restrictions under Applicable Securities Laws and the
                                         Subscriber will comply with all applicable Laws concerning any resale of the Securities
                                         and the Subscriber will consult with its legal advisors with respect to complying with
                                         any restrictions applying to such resale;

 

		(f)	None
                                         of the Securities have been registered under the U.S. Securities Act or the Applicable
                                         Securities Laws of any State in the United States, and the Subscriber may not offer,
                                         sell or otherwise transfer the Securities, directly or indirectly, within the United
                                         States or to, or for the account or benefit of, a U.S. Person, unless (i) the offer and
                                         sale of the Securities is registered under the U.S. Securities Act and the Applicable
                                         Securities Laws of all applicable States or (ii) an exemption from such registration
                                         requirements is available and the Subscriber, prior to such sale or transfer, has furnished
                                         to the Corporation an opinion of counsel, of recognized standing reasonably satisfactory
                                         to the Corporation, or other certifications reasonably satisfactory to the Corporation,
                                         to that effect;

 

		(g)	Hedging
                                         transactions involving the Securities may not be conducted unless such transactions are
                                         in compliance with the provisions of the U.S. Securities Act and in each case only in
                                         accordance with Applicable Securities Laws;

 

		(h)	The
                                         Units are being offered for sale on a “private placement” basis;

 

		(i)	A
                                         finder’s fee or commission, payable in Warrants, will be paid to Southern Arc Minerals
                                         Inc. who introduced the Subscriber to the Offering. Additionally, finder’s fees
                                         or commissions, payable in cash or securities of the Corporation, may be paid to eligible
                                         individuals or entities who introduce investors who participate in the balance of the
                                         Current Offering. All finder’s fees or commissions are subject to compliance with
                                         CSE policies and Applicable Securities Laws;

    - 7 -

     

    

		(j)	The
                                         Units subscribed for by the Subscriber form part of a larger offering of Units being
                                         made by the Corporation (the “Current Financing”), of up to 25,000,000
                                         Units for gross proceeds of up to $2,500,000, with closings to occur, subject to regulatory
                                         approval, in one or multiple tranches;

 

		(k)	The
                                         Subscriber is solely responsible for obtaining such tax and legal advice from its own
                                         advisors as it considers appropriate in connection with the execution, delivery and performance
                                         by it of this Agreement and the transactions contemplated hereunder (including the resale
                                         and transfer restrictions referred to herein);

 

		(l)	The
                                         Subscriber understands and agrees that there may be material tax consequences as a result
                                         of acquiring, holding or disposing of the Securities. The Corporation gives no opinion
                                         and makes no representation with respect to the tax consequences under United States,
                                         Canadian, state, provincial, local or foreign tax Law as a result of the Subscriber acquiring,
                                         holding or disposing of the Securities, and the Subscriber acknowledges that it is solely
                                         its responsibility for determining the tax consequences of an investment in the Units;

 

		(m)	In
                                         accepting this Agreement, the Corporation is relying upon the representations, warranties,
                                         covenants and acknowledgements of the Subscriber set out herein including, without limitation,
                                         in connection with determining the eligibility of the Subscriber to purchase the Units
                                         under Applicable Securities Laws. The Subscriber hereby agrees to notify the Corporation
                                         immediately of any change in any representation, warranty, covenant, acknowledgement
                                         or other information relating to the Subscriber contained in this Agreement that takes
                                         place prior to the Closing;

 

		(n)	The
                                         Subscriber consents to the Corporation making a notation on its records or giving instructions
                                         to any registrar or transfer agent of the Corporation in order to implement the restrictions
                                         on transfer set forth and described in this Agreement, and the Corporation will refuse
                                         to register any transfer of the Securities not made in accordance with Regulation S,
                                         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
                                         accordance with Applicable Securities Laws of the applicable state;

 

		(o)	The
                                         Subscriber is solely responsible for all costs relating to lost Unit Share, Warrant or
                                         Warrant Share certificates issued with respect to this Agreement delivered to the address
                                         for delivery noted on page 1 hereof, and all costs relating to any future permitted removal
                                         of any legends affixed to Unit Share, Warrant and Warrant Share certificates issued pursuant
                                         to this Agreement;

 

		(p)	The
                                         Corporation has advised the Subscriber that the Corporation is relying on an exemption
                                         from the requirements to provide the Subscriber with a prospectus under Applicable Securities
                                         Laws and, as a consequence of acquiring the Units pursuant to this exemption, certain
                                         protections, rights and remedies provided by such Laws, including statutory rights of
                                         rescission or damages, will not be available to the Subscriber;

 

		(q)	No
                                         person has made to the Subscriber any written or oral representations:

 

		(i)	That
                                         any person will resell or repurchase the Unit Shares, Warrants or Warrant Shares;

 

		(ii)	That
                                         any person will refund the purchase price of the Units; or

 

		(iii)	As
                                         to the future price or value of any of the Unit Shares, Warrants or Warrant Shares; and

 

		(r)	Upon
                                         the issuance thereof, and until such time as the same is no longer required under Applicable
                                         Securities Laws, any certificates representing the Unit Shares and Warrants (and the
                                         Warrant Shares, if applicable), and all securities issued in exchange therefor or in
                                         substitution thereof, will bear legends in substantially the following form:

    - 8 -

     

    

THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “U.S. SECURITIES ACT”),
OR ANY U.S. STATE SECURITIES LAWS, AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE U.S. SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE U.S. SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. HEDGING TRANSACTIONS INVOLVING
THESE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE U.S. SECURITIES ACT.

 

UNLESS
PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY MUST NOT TRADE THE SECURITY BEFORE [INSERT THE DATE THAT
IS 4 MONTHS AND A DAY AFTER THE DISTRIBUTION DATE].

 

Section
5. Conditions of Closing

 

		(a)	The
                                         Subscriber acknowledges and agrees that, as the sale of the Units will not be registered
                                         or qualified by a prospectus, such sale is subject to the condition that the Subscriber
                                         sign and return to the Corporation before the Closing this Agreement and all other documents
                                         required to be completed and signed in accordance therewith.

 

		(b)	If
                                         the purchase of the Units pursuant to the provisions of this Agreement does not occur,
                                         the Corporation will immediately return this Agreement to the Subscriber, together with
                                         any payment that has been made in respect of the Units without interest thereon (and
                                         in any event on or before October 18, 2018) and the obligations of the parties hereto
                                         will thereupon terminate.

 

Section
6. Representations, Warranties and Covenants of the Subscriber

 

The
Subscriber represents and warrants to, and covenants with the Corporation that:

 

		(a)	The
                                         Subscriber is resident in the jurisdiction set out on page 1 of this Agreement;

 

		(b)	Either:

 

		(i)	          The
                                         Subscriber is purchasing the Units as principal for its own account and not for the benefit
                                         of any other person, and not with a view to the resale or
                                         distribution of all or any of the Securities; or

 

		(ii)	          If
                                         the Subscriber is acting as agent or trustee for one or more beneficial purchasers, each
                                         beneficial purchaser is purchasing as principal for its own account for investment purposes
                                         only and not for the benefit of any other person, and not with a view to the resale or
                                         distribution of all or any of the Units, and each beneficial purchaser complies with
                                         the applicable clause of paragraph (c) below as is applicable to it by virtue of its
                                         jurisdiction of residence;

 

		(c)	The
                                         Subscriber will only offer, sell or otherwise transfer the Securities pursuant to an
                                         effective registration statement under the U.S. Securities Act or pursuant to an exemption
                                         from the registration requirements imposed by the U.S. Securities Act and in compliance
                                         with state Applicable Securities Laws (and, in each case where there is no effective
                                         registration statement, only if an opinion of counsel of recognized standing reasonably
                                         satisfactory to the Corporation or other certifications reasonably satisfactory to the
                                         Corporation, have been provided to the Corporation to that effect);

 

		(d)	The
                                         Subscriber acknowledges and agrees that the Securities will be “restricted securities”
                                         within the meaning of Rule 144(a)(3) under the 1933 Act and will remain “restricted

    - 9 -

     

    

securities”
notwithstanding any resale within or outside the United States unless the sale is completed pursuant to an effective registration
statement under the U.S. Securities Act or is made in compliance with the exemption from registration provided by Rule
144 promulgated under the U.S. Securities Act;

 

		(e)	The
                                         Subscriber has no contract, undertaking, agreement or arrangement with any person to
                                         sell, transfer or pledge to such person, or anyone else, the Securities or any part thereof,
                                         or any interest therein, and has no present plans to enter into any such contract, undertaking,
                                         agreement or arrangement;

 

		(f)	The
                                         Subscriber is a U.S. Subscriber and:

 

		(i)	          The
                                         Subscriber is a U.S. Accredited Investor and has completed the U.S. Accredited Investor
                                         Certificate in the form attached hereto as Schedule “B”;

 

		(ii)	          The
                                         Subscriber acknowledges that it is acquiring the Securities as an investment for its
                                         own account or for the account of a U.S. Accredited investor for which it exercises sole
                                         investment discretion and not with a view to any resale, distribution or other disposition
                                         of the Securities in violation of U.S. federal or state Applicable Securities Laws;

 

		(iii)	          The
                                         Subscriber acknowledges that it will be required to confirm its status as a U.S. Accredited
                                         Investor and make representations similar to those contained in this paragraph (f) at
                                         the time of exercise of any Warrants;

 

		(iv)	          The
                                         Subscriber understands and acknowledges that the Securities have not been registered
                                         under the U.S. Securities Act or any state securities laws and that the sale of the Units
                                         contemplated hereby is being made to a limited number of U.S. Accredited Investors in
                                         transactions not requiring registration under the U.S. Securities Act; accordingly the
                                         Securities are “restricted securities” within the meaning of Rule 144(a)(3)
                                         under the U.S. Securities Act;

 

		(v)	          The
                                         Subscriber acknowledges that the Corporation has not registered the offer and sale to
                                         the Subscriber of the Securities under the U.S. Securities Act and until a registration
                                         statement registering resales of the Unit Shares and Warrant Shares becomes effective,
                                         as contemplated by the registration rights granted by the Corporation pursuant to Schedule “D”,
                                         the Subscriber acknowledges that there are substantial restrictions on the transferability
                                         of, and that it may not readily be possible for the Subscriber to liquidate its investment
                                         in, the Unit Shares or the Warrant Shares; and

 

		(vi)	          The
                                         Subscriber acknowledges and confirms that the purchase of the Units has not been made
                                         through or as a result of any general solicitation or general advertising (as such terms
                                         are defined in Rule 502(c) of Regulation D);

 

		(g)	The
                                         Subscriber has completed, executed and delivered to the Corporation the Investor Exemptions
                                         Certificate in the form attached hereto as Schedule “A”, together with all
                                         applicable exhibits thereto;

 

		(h)	The
                                         Subscriber has not been created and is not being used primarily to permit the purchase
                                         of the Units without a prospectus in reliance on an exemption from the prospectus requirements
                                         of Applicable Securities Laws or other applicable Laws;

 

		(i)	If
                                         the Subscriber is an individual, the Subscriber has attained the age of majority and
                                         is legally competent to execute this Agreement and to take all actions required pursuant
                                         hereto and if the Subscriber is not an individual, this Agreement has been authorized,
                                         executed and delivered by,

    - 10 -

     

    

and constitutes a legal, valid and binding agreement of the
                                         undersigned and if the Subscriber is a corporation, it has been duly incorporated and
                                         validly exists under the Laws of its jurisdiction of incorporation or continuance and
                                         this Agreement has been duly authorized by all necessary corporate action and constitutes
                                         a legal and binding agreement of the corporation;

 

		(j)	The
                                         Subscriber is capable of assessing and evaluating the risks and merits of this investment
                                         as a result of the Subscriber’s financial, investment or business experience or
                                         as a result of advice received from a registered
                                         person other than the Corporation or an Affiliate thereof, and the Subscriber is able
                                         to bear the economic loss of its investment;

 

		(k)	This
                                         Agreement has been duly and validly authorized, executed and delivered by and constitutes
                                         a legal, valid, binding and enforceable obligation of the Subscriber except that the
                                         enforceability of this Agreement may be subject to bankruptcy, insolvency, reorganization,
                                         fraudulent conveyance or transfer, moratorium and similar Laws affecting creditors’
                                         rights generally and subject to general principles of equity (regardless of whether enforceability
                                         is considered in a proceeding in equity or at law) and will not violate or conflict with
                                         the terms of any restriction, agreement or undertaking to which the Subscriber is a party;

 

		(l)	No
                                         prospectus or offering memorandum within the meaning of Applicable Securities Laws has
                                         been delivered to or summarized for or seen by the Subscriber in connection with the
                                         Offering and the Subscriber is not aware of any prospectus or offering memorandum having
                                         been prepared by the Corporation;

 

		(m)	The
                                         Subscriber has no intention to, and will not, distribute (either directly or indirectly),
                                         any of the Securities in the United States, except in compliance with the U.S. Securities
                                         Act and the Applicable Securities Laws of all applicable states of the United States
                                         or if an exemption from such requirements is available;

 

		(n)	The
                                         entering into of this Agreement and the transactions contemplated hereby will not result
                                         in the violation of any of the terms and provisions of any Law applicable to, or the
                                         constating documents of, the Subscriber or of any agreement, written or oral, to which
                                         the Subscriber may be a party or by which it is or may be bound or the termination of
                                         any such agreement;

 

		(o)	The
                                         Subscriber will execute and deliver within the approved time periods, all documentation
                                         as may be required by the Applicable Securities Laws or other applicable Laws to permit
                                         the purchase and sale of the Units on terms herein set forth;

 

		(p)	If
                                         required by Applicable Securities Laws or other applicable Laws the Subscriber will execute,
                                         deliver, file and otherwise assist the Corporation in filing such reports, undertakings
                                         and other documents with respect to the issuance of the Units as may be required;

 

		(q)	In
                                         the case of the purchase of Units by the Subscriber as trustee or agent, the Subscriber
                                         has due and proper authority to act as trustee or agent for and on behalf of such beneficial
                                         purchaser in connection with the transactions contemplated hereby. The Subscriber is
                                         duly authorized to execute and deliver this Agreement and all other necessary documentation
                                         in connection with such purchase on behalf of such beneficial purchaser and this Agreement
                                         has been duly authorized, executed and delivered by or on behalf of, and constitutes
                                         a legal, valid and binding agreement of, such beneficial purchaser, and the representations
                                         and warranties contained in this Agreement are being made on behalf of such beneficial
                                         purchaser;

 

		(r)	The
                                         Corporation has provided the Subscriber with the opportunity to ask questions and seek
                                         answers concerning this Agreement and the Subscriber has had access to all information
                                         concerning the Corporation as it has considered necessary in connection with its decision
                                         to purchase the Units. The Subscriber further represents and warrants that the Subscriber
                                         has received satisfactory information concerning the business and financial condition
                                         of the Corporation in response to all inquiries
                                         in respect thereof;

    - 11 -

     

    

		(s)	The
                                         Corporation’s legal counsel is acting solely for the Corporation in connection
                                         with the Offering, the Subscriber may not rely upon such counsel in any respect and the
                                         Subscriber has been encouraged to and should obtain independent legal, income tax and
                                         investment advice with respect to its subscription;

 

		(t)	To
                                         the best of the Subscriber’s knowledge none of the Funds (i) have been or will
                                         be derived from or related to any activity that is deemed criminal under the Laws the
                                         United States of America or any other jurisdiction, or (ii) are being tendered on behalf
                                         of a person or entity who has not been identified to the Subscriber. The Subscriber will
                                         promptly notify the Corporation if the Subscriber discovers that any of such representations
                                         ceases to be true, and will provide the Corporation with appropriate information in connection
                                         therewith; and

 

		(u)	The
                                         Subscriber has read and understands the contents of this Agreement and agrees to be legally
                                         bound hereby.

 

Section
7. Reliance Upon Representations, Warranties, Covenants and Acknowledgements

 

The
Subscriber acknowledges that the representations, warranties, covenants and acknowledgements contained in this Agreement are made
by the Subscriber with the intent that they may be relied upon by the Corporation and its legal counsel. The Subscriber covenants
with the Corporation that such representations, warranties, covenants and acknowledgements will be true at the time of execution
of this Agreement and at the Closing, and will continue in full force and effect and be binding upon the Subscriber notwithstanding
any subsequent disposition of the Shares, the Warrants or the Warrant Shares. The Corporation acknowledges that the representations,
warranties, covenants and acknowledgements contained in this Agreement are made by the Corporation with the intent that they may
be relied upon by the Subscriber and its legal counsel. The Corporation covenants with the Subscriber that such representations,
warranties, covenants and acknowledgements will be true at the time of execution of this Agreement and at the Closing.

 

Section
8. Indemnities

 

		(a)	The
                                         Subscriber agrees to indemnify and hold harmless the Corporation and its directors, officers,
                                         employees, agents, advisors and legal counsel, and their respective Associates and Affiliates,
                                         from and against any and all loss, liability, claim, damage and expense whatsoever including,
                                         but not limited to, any and all fees, costs and expenses whatsoever reasonably incurred
                                         in investigating, preparing or defending against any litigation, administrative proceeding
                                         or investigation commenced or threatened or any claim whatsoever arising out of or based
                                         upon any representation or warranty of the Subscriber contained herein or in any document
                                         furnished by the Subscriber to the Corporation in connection herewith being untrue in
                                         any material respect or any breach or failure by the Subscriber to comply with any covenant,
                                         acknowledgement or agreement made by the Subscriber herein or in any document furnished
                                         by the Subscriber to the Corporation in connection herewith.

 

		(b)	The
                                         Corporation agrees to indemnify and hold harmless the Subscriber and its directors, officers,
                                         employees, agents, advisors and legal counsel, and their respective Associates and Affiliates,
                                         from and against any and all loss, liability, claim, damage and expense whatsoever including,
                                         but not limited to, any and all fees, costs and expenses whatsoever reasonably incurred
                                         in investigating, preparing or defending against any litigation, administrative proceeding
                                         or investigation commenced or threatened or any claim whatsoever arising out of or based
                                         upon any representation or warranty of the Corporation contained herein or in any document
                                         furnished by the Corporation to the Subscriber in connection herewith being untrue in
                                         any material respect or any breach or failure by the Corporation to comply with any covenant,
                                         acknowledgement or agreement made by the Corporation herein or in any document furnished
                                         by the Corporation to the Subscriber in connection herewith.

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Section
9. Collection of Personal Information

 

The
Subscriber acknowledges and consents to the fact that the Corporation is collecting the Subscriber’s personal information
for the purpose of fulfilling this Agreement and completing the Offering. The Subscriber agrees that such personal information
may be disclosed by the Corporation to (a) stock exchanges or securities regulatory authorities, (b) the Corporation’s registrar
and transfer agent, (c) Canadian and U.S. tax authorities, (d) authorities pursuant to the Proceeds of Crime (Money Laundering)
and Terrorist Financing Act (Canada) and the Uniting and Strengthening America by Providing Appropriate Tools Required
to Intercept and Obstruct Terrorism Act of 2001 and (e) any of the other parties involved in the Offering, including the Corporation’s
legal counsel, and may be included in record books in connection with the Offering. By executing this Agreement, the Subscriber
is deemed to be consenting to the foregoing collection, use and disclosure of the Subscriber’s personal information and
to the retention of such personal information for as long as permitted or required by Law or business practice. Notwithstanding
that the Subscriber may be purchasing the Units as trustee or agent on behalf of an undisclosed principal, the Subscriber agrees
to provide, on request, particulars as to the identity of such undisclosed principal as may be required by the Corporation in
order to comply with the foregoing.

 

Section
10. Representations and Warranties of the Corporation

 

The
Corporation represents and warrants to the Subscriber that, and acknowledges and confirms that the Subscriber is relying upon
such representations and warranties in connection with the purchase of the Units by the Subscriber hereunder:

 

		(a)	Organization. Each of the Corporation and the Subsidiary is a valid and subsisting corporation
                                         duly incorporated and in good standing under the Laws of the respective jurisdiction
                                         in which it is incorporated. Each of the Corporation and the Subsidiary is duly registered
                                         and licensed to carry on business in the jurisdictions in which it carries on business
                                         or owns property where required under the Laws of those jurisdictions and has all requisite
                                         corporate capacity and power to carry on its business, as now conducted and as presently
                                         proposed to be conducted by it, and to own its properties and assets and conduct its
                                         business as described in the Public Record.

 

		(b)	Compliance
                                         with Laws. Except where non-compliance does not have and would not reasonably be
                                         expected to have a Material Adverse Effect, each of the Corporation and the Subsidiary
                                         has conducted and is conducting its business in compliance with all applicable Laws of
                                         each jurisdiction in which it carries on business and neither the Corporation nor the
                                         Subsidiary has received any notice of any alleged violation of any such Laws. The Corporation
                                         is not aware of any Law, or proposed Law published by a legislative body, which it anticipates
                                         will adversely affect the Business, affairs, operations, assets, liabilities (contingent
                                         or otherwise) or prospects of the Corporation on a consolidated basis.

 

		(c)	Authorization. The Corporation has or will have prior to the Closing Date the requisite corporate
                                         power and capacity to complete the Offering, to enter into this Agreement and to perform
                                         its obligations hereunder, including the issue and sale of the Units. This Agreement
                                         has been or will be prior to the Closing Date duly authorized, executed and delivered
                                         by the Corporation and is or will be prior to the Closing Date a valid and binding agreement
                                         of the Corporation enforceable against the Corporation in accordance with its terms,
                                         subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
                                         similar Laws affecting creditors’ rights generally and subject to the qualification
                                         that equitable remedies may be granted in the discretion of a court of competent jurisdiction.

 

		(d)	No
                                         Violation. The execution and delivery of this Agreement and the issue and sale of
                                         the Units by the Corporation do not and will not conflict with, and do not and will not
                                         result in a breach of, any of the terms of the Corporation’s constating documents
                                         or any agreement or instrument to which either the Corporation or the Subsidiary is a
                                         party.

    - 13 -

     

    

		(e)	The
                                         Corporation has complied and will comply fully with the requirements of all corporate
                                         and Applicable Securities Laws in all matters relating to the Offering, including the
                                         issue and sale of the Units.

 

		(f)	Capitalization. The authorized capital stock of the Corporation consists of 400,000,000 shares of
                                         common stock with a par value of US$0.001. The Disclosure Schedule sets forth the issued
                                         and outstanding capital of the Corporation as at the date set out in the Disclosure Schedule.
                                         All of the issued and outstanding Shares are fully paid and non-assessable and have been
                                         duly and validly authorized and issued, in compliance with applicable Laws and not in
                                         violation of or subject to any pre-emptive or similar right that entitles any person
                                         to acquire from the Corporation any Shares or other security of the Corporation or any
                                         Convertible Securities. Except as set forth in the Disclosure Schedule no other securities
                                         of the Corporation are issued and outstanding other than the Shares referred to in this
                                         section 10(f).

 

		(g)	Issuance
                                         of Units. The Units have been or will be prior to the Closing Date duly created and
                                         authorized for issuance and, upon receipt by the Corporation of the Funds in full, will
                                         be validly issued.

 

		(h)	Issuance
                                         of Unit Shares. The Unit Shares have been or will be prior to the Closing Date duly
                                         authorized for issuance and, when issued and delivered by the Corporation will be validly
                                         issued as fully paid and non-assessable shares in the capital stock of the Corporation,
                                         free and clear of any and all Encumbrances.

 

		(i)	Issuance
                                         of Warrants. The Warrants have been or will be prior to the Closing Date duly created
                                         and authorized for issuance and, when issued and delivered by the Corporation will be
                                         validly issued.

 

		(j)	Issuance
                                                                                                                                                                                                                             of Warrants Shares. The Warrant Shares have been or will be prior to the Closing Date duly reserved and authorized for
                                                                                                                                                                                                                             issuance and, upon receipt by the Corporation of the exercise price therefor in full, will be validly issued as fully paid
                                                                                                                                                                                                                             and non-assessable shares in the capital of the Corporation, free and clear of any and all Encumbrances.

 

		(k)	No
General Solicitation. Neither the Corporation nor any of its Affiliates, nor any person acting on its or their behalf, has engaged
in or will engage in any form of “general solicitation” or “general advertising” (as such terms are defined
in Rule 502(c) of Regulation D) in the United States with respect to offers or sales of the Units.

 

		(l)	Litigation.
                                         Except as may be disclosed in the Public Record, neither the Corporation nor the Subsidiary
                                         is a party to any actions, suits or proceedings which could materially affect the business
                                         or financial condition of the Corporation and, to the best of the Corporation’s
                                         knowledge, no such actions, suits or proceedings are contemplated or have been threatened.
                                         There are no judgments against the Corporation or the Subsidiary which are unsatisfied,
                                         nor are there any consent decrees or injunctions to which the Corporation or the Subsidiary
                                         is subject.

 

		(m)	No
                                         Insolvency Proceedings. Neither the Corporation nor the Subsidiary has: (i) committed
                                         an act of bankruptcy and neither is insolvent; (ii) proposed a compromise or arrangement
                                         to its creditors generally; (iii) to the Corporation’s knowledge, had a petition
                                         or a receiving order in bankruptcy filed against it; (iv) made a voluntary assignment
                                         in bankruptcy; (v) taken any proceedings with respect to a compromise or arrangement;
                                         (vi) taken any proceedings to have itself declared bankrupt or wound-up; (vii) taken
                                         any proceedings to have a receiver appointed for any of its property; and (viii) had
                                         any execution or distress become enforceable or become levied upon any of its property.

 

		(n)	Voting
and Registration Rights. Other than as contemplated herein, neither the Corporation nor, to the knowledge of the Corporation,
any of its shareholders, is a party to any shareholders agreement, pooling agreement, voting trust or other similar type of arrangement
in respect of

    - 14 -

     

    

outstanding
securities of the Corporation. Other than as set out in the Disclosure Schedule and as contemplated herein, there are no persons
with registration rights or other similar rights granted by the Corporation to have any securities of the Corporation registered
or qualified for distribution pursuant to any Applicable Securities Laws.

 

		(o)	Regulatory
Matters.

 

		(i)	The
                                         Corporation is a “reporting issuer” under the Applicable Securities Laws
                                         of each of the Reporting Jurisdictions and is not noted as being in default on the list
                                         of reporting issuers maintained under the Applicable Securities Laws of each of the Reporting
                                         Jurisdictions, and in particular, without limiting the foregoing, the Corporation is
                                         in material compliance with its disclosure obligations under the Applicable Securities
                                         Laws and there is no material change relating to the Corporation which has occurred and
                                         with respect to which the requisite material change report has not been filed with the
                                         Securities Regulators. The Corporation has not taken any action to cease to be a reporting
                                         issuer in any jurisdiction in which it is a reporting issuer, and has not received any
                                         notification from a Securities Regulator or the SEC seeking to revoke the reporting issuer
                                         status of the Corporation. The Corporation is current in filing all reports required
                                         to be filed by it pursuant to Section 13(a) or Section 15(d) of the U.S. Exchange Act.

 

		(ii)	Except
                                         as disclosed in the Disclosure Schedule, as of their respective filing dates, each of
                                         the documents comprising the Public Record complied in all material respects with the
                                         requirements of Applicable Securities Laws. None of the documents comprising the Public
                                         Record contained any untrue statement of a material fact or omitted to state a material
                                         fact required to be stated therein or necessary to make the statements made therein,
                                         in light of the circumstances in which they were made, not misleading. The Corporation
                                         has not filed any confidential material change report or other confidential report with
                                         any Securities Regulators, the SEC or other Governmental Entity which at the date hereof
                                         remains confidential.

 

		(iii)	The
                                         Technical Report complies in all material respects with the provisions of NI 43-101.

 

		(p)	Listing
                                         of Shares. The Shares are listed and posted for trading on the CSE and no order ceasing
                                         or suspending trading in any securities of the Corporation or prohibiting the issuance
                                         of such securities or the trading of any of the Corporation’s issued Shares has
                                         been issued and no (formal or informal) proceedings for such purpose have been threatened
                                         or, to the knowledge of the Corporation, are pending. The Corporation has not taken any
                                         action which would reasonably be expected to result in the delisting or suspension of
                                         the Shares on or from the CSE.

 

		(q)	Financial
Statements. The Financial Statements comply as to form in all material respects with Applicable Securities Laws. The Financial
Statements have been prepared in accordance with generally accepted accounting principles of the United States and present fairly,
in all material respects, the financial condition of the Corporation, on a consolidated basis, as at the dates thereof and for
the periods then ended. The Corporation does not intend to correct or restate, nor, to the knowledge of the Corporation, is there
any basis for any correction or restatement of, any aspect of the Financial Statements.

 

		(r)	No
                                         Liabilities. The Corporation, on a consolidated basis, does not have any liabilities,
                                         direct or indirect, contingent or otherwise, not disclosed in the Public Record which
                                         materially adversely affects the Corporation on a consolidated basis or would reasonably
                                         be expected to have a Material Adverse Effect upon the condition (financial or otherwise),
                                         capital, property, assets, operations or Business of the Corporation on a consolidated
                                         basis. Without limiting the generality of the foregoing, the Corporation on a consolidated
                                         basis does not have any material obligation or liability except as disclosed in the Public
                                         Record or those arising in the ordinary course of business, none of which is materially
                                         adverse to the Corporation.

    - 15 -

     

    

		(s)	No
                                         Material Changes. Except as disclosed in the Public Record, since April 30, 2018,
                                         no change has occurred in any of the assets, business, financial condition or results
                                         of operations of the Corporation on a consolidated basis which, individually or in the
                                         aggregate, has had, will have or could reasonably be expected to have a Material Adverse
                                         Effect on the business, affairs, operations, assets, liabilities (contingent or otherwise),
                                         prospects of the Corporation, or on the price or value of the Shares.

 

		(t)	Permits. The Corporation and the Subsidiary have obtained all permits, certificates, licenses,
                                         approvals, consents and other authorizations (collectively, the “Permits”)
                                         issued by the appropriate Governmental Authority necessary to carry on the Business of
                                         the Corporation as it is currently conducted and the Corporation expects any additional
                                         Permits that are required to carry out its planned business activities, including without
                                         limitation the re-commencement of exploration activities at the Project, to be obtained,
                                         except where the failure to possess or obtain such Permits would not reasonably be expected
                                         to have a Material Adverse Effect. The Corporation and the Subsidiary are in compliance
                                         with the terms and conditions of all such Permits currently held except where such non-compliance
                                         would not reasonably be expected to have a Material Adverse Effect.

 

		(u)	Mineral
                                         Rights.

 

		(i)	The
Technical Report and the Public Record describe all mineral interests, mining concessions, mining tenements or other mineral rights
owned by or subject to any license, option or similar agreement in favour of the Corporation that are material to the Business
(the “Mineral Rights”). The Corporation does not hold, license or have any other material interest in any mineral
interests, mining concessions, mining tenements or other mineral rights other than the Mineral Rights.

 

		(ii)	The
                                         Mineral Rights have been properly located and recorded in compliance with applicable
                                         Laws and are comprised of valid and subsisting mineral claims.

 

		(iii)	The
                                         Corporation is the registered and beneficial owner of the Mineral Rights with good and
                                         marketable title thereto, free and clear of any title defect or Encumbrance.

 

		(iv)	The
                                         Mineral Rights constitute all of the right, title and interest necessary or appropriate
                                         to authorize and enable the Corporation to carry on the Business.

 

		(v)	The
                                         Corporation has the exclusive right to deal with the Mineral Rights, and there are no
                                         restrictions on the ability of the Corporation to use, transfer or exploit the Mineral
                                         Rights except pursuant to applicable Laws.

 

		(vi)	No
                                         person other than the Corporation has any interest in the production or profits to be
                                         obtained in the future from the Mineral Rights or any royalty in respect thereof or any
                                         right to acquire any such interest.

 

		(vii)	There
                                         are no farm-in or earn-in rights, rights of first refusal or similar rights or provisions
                                         which could materially affect the Mineral Rights.

 

		(viii)	The
                                         Corporation has not received any notice, whether written or oral, from any Governmental
                                         Entity or any person with jurisdiction or applicable authority of any revocation or intention
                                         to revoke the interest of the Corporation in any Mineral Right.

 

		(ix)	The
                                         Mineral Rights are in good standing under applicable Law; all work required to be performed
                                         thereon has been performed and all Taxes, rentals, fees, expenditures and other payments
                                         in respect thereof have been paid or incurred and all filings in respect thereof have
                                         been made.

    - 16 -

     

    

		(x)	All
                                         exploration activities in respect of the Mineral Rights have been conducted in all material
                                         respects in accordance with good mining and engineering practices and all material workers’
                                         compensation and health and safety regulations have been complied with.

 

		(xi)	There
                                         are no adverse claims, actions, suits or proceedings that have been commenced, and to
                                         the knowledge of the Corporation none are pending or threatened and there are no state
                                         of facts or events that may give rise thereto or which could affect the title to or right
                                         to explore or develop the Mineral Rights which involves the possibility of any judgment
                                         or liability affecting the Mineral Rights.

 

		(v)	Expropriation. No asset of the Corporation and none of the Mineral Rights have been taken or expropriated
                                         by any Governmental Entity or person, nor has any notice or proceeding in respect thereof
                                         been given or commenced nor, to the knowledge of the Corporation, is there any intent
                                         or proposal to give any such notice or commence any such proceeding.

 

		(w)	No
                                         Options, etc. Other than as disclosed in the Public Record, no person has any contract
                                         (including an option) or any right or privilege capable of becoming same for the purchase
                                         from the Corporation of any of its material assets (including without limitation the
                                         Mineral Rights).

 

		(x)	Environmental.

 

		(i)	To
                                         the knowledge of the Corporation, the Business, and the Mineral Rights and all operations
                                         thereon have been and are in material compliance with Environmental Laws.

 

		(ii)	The
                                         Corporation has not used or permitted to be used, except in compliance with all Environmental
                                         Laws, any property of the Corporation to release, generate, manufacture, process, distribute,
                                         use, treat, store, transport or handle any Hazardous Substance.

 

		(iii)	None
                                         of the Corporation, the Business nor the Mineral Rights is subject to any pending, nor,
                                         to the knowledge of the Corporation, any threatened:

 

		(A)	claim,
action, notice, demand, allegation, investigation, proceeding, application, order, judgment, requirement or directive which relates
to environmental, Hazardous Substances, human health or safety matters, and which may require or result in any work, repairs,
rehabilitation, reclamation, remediation, construction, obligations, liabilities or expenditures (and there is no basis for such
a claim, action, notice, demand, allegation, investigation, proceeding, application, order, judgment, requirement or directive);
or

 

		(B)	allegation,
                                         demand, direction, order, notice or prosecution with respect to any Environmental Law
                                         applicable thereto including any Laws respecting the use, storage, treatment, transportation,
                                         rehabilitation, reclamation, remediation or disposition of any Hazardous Substance (including
                                         without limitation tailings, waste rock, sediment from erosion, wastewater and surface
                                         water run-off) from the Business or the Mineral Rights and the Corporation has not settled
                                         any allegation of non-compliance with Environmental Laws prior to prosecution.

 

		(iv)	To
                                         the knowledge of the Corporation, there are no pending or proposed changes to Environmental
                                         Laws that would render illegal or materially restrict, the Business.

 

		(y)	Taxes.
Except as disclosed in the Disclosure Schedule, all Taxes due and payable by the Corporation and the Subsidiary, have been paid
except where the failure to pay such Taxes would not reasonably be expected to have a Material Adverse Effect in respect of the
Corporation on a consolidated basis. All Tax Returns, declarations, remittances and filings required to be filed by the Corporation
and the Subsidiary have been filed with all appropriate governmental

    - 17 -

     

    

authorities
and all such returns, declarations, remittances and filings did not contain a misrepresentation as at the respective dates thereof
except where the failure to file such documents or such misrepresentation would not reasonably be expected to have a Material
Adverse Effect in respect of the Corporation on a consolidated basis. To the knowledge of the Corporation, no examination of any
Tax Return of the Corporation or the Subsidiary is currently in progress and there are no issues or disputes outstanding with
or threatened by any governmental authority respecting any Taxes that have been paid, or may be payable, by the Corporation or
the Subsidiary.

 

		(z)	Investment
                                         Corporation. The Corporation is not, and at the time of Closing will not be, an “investment
                                         company” within the meaning of the United States Investment Company Act of 1940,
                                         as amended, and is not registered or required to be registered under such act.

 

		(aa)	Foreign
                                         Corrupt Practices. None of the Corporation nor, to the knowledge of the Corporation,
                                         any director, officer, agent, employee or other person acting on behalf of the Corporation,
                                         in the course of its actions for, or on behalf of, the Corporation (i) used, or authorized
                                         the use of, any corporate funds for any unlawful contribution, gift, entertainment or
                                         other unlawful expenses relating to political activity; (ii) made, or authorized the
                                         making of, any direct or indirect unlawful payments to any Canadian, United States or
                                         foreign government official or employee from corporate funds; (iii) violated or is in
                                         violation of any provision of the Canadian Corruption of Foreign Public Officials
                                         Act, the United States Foreign Corrupt Practices Act or any similar act under
                                         any Laws that the Corporation is subject to; or (iv) made, or authorized the making of,
                                         any unlawful bribe, rebate, payoff, influence payment, kickback or other unlawful payment
                                         to any foreign or domestic government official or employee.

 

		(bb)	Insurance. The assets of the Corporation, and its Business are insured against loss or damage
                                         with responsible insurers on a basis consistent with insurance obtained by reasonably
                                         prudent participants in comparable businesses, and such coverage is in full force and
                                         effect, and the Corporation has not breached the terms of any policies in respect thereof
                                         nor failed to promptly give any notice or present any material claim thereunder. There
                                         are no claims by the Corporation or the Subsidiary under any such policy as to which
                                         any insurance company is denying liability or defending under a reservation of rights
                                         clause. The Corporation does not have any reason to believe that it will not be able
                                         (i) to renew its existing insurance coverage as and when such insurance coverage expires
                                         or (ii) to obtain comparable coverage from similar institutions as may be necessary or
                                         appropriate to conduct its Business as now conducted and at a cost that would not result
                                         in a Material Adverse Effect.

 

		(cc)	No
                                         Misrepresentation. All information which has been prepared by the Corporation relating
                                         to the Corporation and its Business, properties and liabilities and either publicly disclosed
                                         or provided to the Subscriber, including all financial, marketing, sales and operational
                                         information provided to the Subscriber and all documents in the Public Record is, as
                                         of the date of such information, true and correct in all material respects, and no fact
                                         or facts have been omitted therefrom which would make such information materially misleading.

 

		(dd)	Full
                                         Disclosure. To the knowledge of the Corporation, there is no matter, thing, information,
                                         fact, data or interpretation thereof relating to the Corporation, the Business or any
                                         of its property and assets which could reasonably be expected to have a significant effect
                                         on the price or value of the Shares which has not been disclosed to the Subscriber.

    - 18 -

     

    

Section
11. Covenants of the Corporation

 

The
Corporation hereby covenants to the Subscriber, and acknowledges that the Subscriber is relying on such covenants in connection
with the purchase of the Units, that the Corporation (including its successors and assigns if applicable) will:

 

		(a)	within
                                         the required time, file with any applicable securities agency or commission, any documents,
                                         reports and information, in the required form, required to be filed by Applicable Securities
                                         Laws in connection with the Offering, together with any applicable filing fees and other
                                         materials;

 

		(b)	use
                                         the net proceeds of the Offering only as set forth in the Term Sheet;

 

		(c)	ensure
                                         that at all times prior to the expiry of the Warrants, a sufficient number of Warrant
                                         Shares are allotted and reserved for issuance upon the due exercise of the Warrants in
                                         accordance with their terms;

 

		(d)	ensure
                                         that the Warrant Shares issuable upon the due exercise of the Warrants in accordance
                                         with their terms, shall be duly issued as fully paid and non-assessable Shares of the
                                         Corporation on payment of the exercise price therefor;

 

		(e)	use
                                         its commercially reasonable efforts to maintain its status as a “reporting issuer”
                                         in, not in default of any requirement of the Applicable Securities Laws of, the Reporting
                                         Jurisdictions and to maintain its status as a reporting issuer under the U.S. Exchange
                                         Act that is current in its reporting obligations thereunder, in each case until the date
                                         that is two years following the Closing Date, other than in circumstances where the Corporation
                                         completes a reverse take-over, merger, amalgamation, arrangement, take-over bid, insider
                                         bid, reorganization, joint venture, sale of all or substantially all assets, exchange
                                         of assets or similar transaction whereby the Corporation completes a business combination
                                         with another public corporation;

 

		(f)	not
                                         take any action which would reasonably be expected to result in the delisting or suspension
                                         of the Shares on or from any securities exchange, market or trading or quotation facility
                                         on which the Shares are now or are then listed or quoted and the Corporation shall comply
                                         with the rules and regulations thereof for a period of two years following the Closing
                                         Date, provided that this covenant shall not prevent the Corporation from completing any
                                         transaction which would result in the Corporation ceasing to be listed so long as the
                                         holders of Shares receive securities of an entity which is listed on a stock exchange
                                         in Canada or the holders of the Shares have approved the transaction; and

 

		(g)	for
                                         a period of at least two years after the Closing Date (other than in circumstances where
                                         the Corporation completes a reverse take-over, merger, amalgamation, arrangement, take-over
                                         bid, insider bid, reorganization, joint venture, sale of all or substantially all assets,
                                         exchange of assets or similar transaction whereby the Corporation completes a business
                                         combination with another public corporation), use its commercially reasonable efforts
                                         to remain a corporation validly subsisting under the Laws of its jurisdiction of incorporation,
                                         licensed, registered or qualified as an extra-provincial or foreign corporation in all
                                         jurisdictions where the character of its properties owned or leased or the nature of
                                         the activities conducted by it make such licensing, registration or qualification necessary
                                         and shall carry on its business in the ordinary course and in compliance in all material
                                         respects with all applicable Laws, rules and regulations of each such jurisdiction.

 

Section
12. Registration Rights

 

The
Corporation hereby grants to the Subscriber the registration rights with respect to the Shares as described in Schedule “D”
attached hereto and incorporated herein by reference. In the event of a conflict between such Schedule “D” and this
Agreement, the contents of Schedule “D” shall prevail.

 

Section
13. Additional Purchase Rights

 

		(a)	The
                                         following Sections 13 to 17 inclusive shall survive Closing and shall not merge on Closing
                                         and shall be in full force and effect in accordance with their respective terms.

    - 19 -

     

    

		(b)	Subject
                                         to compliance with Applicable Securities Laws and, if required, the acceptance of the
                                         CSE, the Corporation hereby grants the Subscriber the following rights in respect of
                                         any future private or public equity financing (each an “Equity Financing”)
                                         of Shares or securities convertible into Shares (collectively, the “Equity Securities”)
                                         undertaken by the Corporation subsequent to closing of the Current Financing and provided
                                         the Subscriber’s Percentage Equity Ownership Interest equals or exceeds 5% or more
                                         of the outstanding Shares of the Corporation:

 

		(i)	the
                                         right (but not the obligation) to participate, on a pro rata basis, in any future
                                         Equity Financing of Equity Securities undertaken by the Corporation to the extent required
                                         to allow the Subscriber to maintain the same Percentage Equity Ownership Interest in
                                         the Corporation that it possessed immediately prior to closing of the Equity Financing
                                         such that the Subscriber does not suffer any equity dilution; and

 

		(ii)	the
                                         right (but not the obligation) to participate in any future Equity Financing of Equity
                                         Securities undertaken by the Corporation to the extent required to allow the Subscriber
                                         to increase its Percentage Equity Ownership Interest in the Corporation to a maximum
                                         of 19.9% of the issued and outstanding Shares immediately following the closing of such
                                         Equity Financing (assuming the conversion, exchange or exercise of all Convertible Securities
                                         then beneficially owned or held by the Subscriber).

 

		 	For
greater certainty, “Equity Financing” does not include any issuances of (i) options granted pursuant to the Corporation’s
stock option plan after the Closing Date (“Post Closing Options”), (ii) Shares issued upon the exercise of currently
outstanding options; (iii) Shares issued upon the exercise of Post-Closing Options or (iv) Shares issued upon the exercise of
share purchase warrants.

 

		(c)	The
                                         Corporation shall deliver a notice to the Subscriber in writing as soon as possible prior
                                         to the public announcement of the Equity Financing, but in any event at least seven Business
                                         Days prior to the proposed closing date of the Equity Financing and provide the Subscriber
                                         with all the terms and conditions of such Equity Financing known to the Corporation,
                                         including any term sheet or equivalent document to be utilized by the Corporation as
                                         part of the Equity Financing. The Corporation shall deliver any and all updates, revisions
                                         and restatements of any such term sheet or equivalent document as soon as the same has
                                         been finalized.

 

		(d)	If
                                         the Subscriber wishes to exercise its rights to participate in an Equity Financing pursuant
                                         to Subsections (b)(i) or (ii) above to either maintain its then current Percentage Equity
                                         Ownership Interest in the Corporation or increase its Percentage Equity Ownership Interest
                                         in the Corporation to 19.9%, then the Subscriber shall provide the Corporation with written
                                         notice (the “Equity Financing Notice”) of its desire to participate
                                         in the Equity Financing and the number of Equity Securities it wishes to purchase within
                                         seven Business Days of the Subscriber’s receipt of the notice of the Equity Financing,
                                         failing which the Subscriber shall be deemed to have elected not to exercise its
                                         rights granted under this Subsection, but only for that one particular Equity
                                         Financing, it being understood and agreed that any such election not to exercise rights
                                         granted under this Subsection shall not be in derogation of rights of the Subscriber
                                         with respect to any future Equity Financing.

 

		(e)	If
                                         the Subscriber delivers the Equity Financing Notice as prescribed under this Subsection,
                                         then the Corporation and the Subscriber shall complete the subscription for the additional
                                         Equity Securities that are the subject of the Equity Financing Notice concurrently with
                                         the completion of the Equity Financing. If the Subscriber elects, or is deemed to have
                                         elected (as described above), not to exercise its rights under this Subsection, then
                                         the Corporation may complete the Equity Financing, provided that such Equity Financing
                                         is upon the same terms and conditions as those set out in the notice of the Equity Financing
                                         provided to the Subscriber.

    - 20 -

     

    

		(f)	In
                                         determining the Subscriber’s percentage equity ownership interest in the Corporation
                                         (the “Percentage Equity Ownership Interest”), such ownership shall
                                         be calculated as follows:

 

A
= B/C X 100

 

Where:

 

		A:	Percentage
Equity Ownership Interest

 

		B:	Number
of Shares owned beneficially by the Subscriber and its Affiliates, collectively

 

		C:	Outstanding
                                         Equity Securities less the number of any outstanding Post Closing Options and any Shares
                                         that have been issued upon exercise of Post Closing Options.

 

Section
14. Right to Appoint a Director

 

		(a)	As
                                         at the Closing Date, and provided that the Subscriber’s Percentage Equity Ownership
                                         Interest equals or exceeds 5% of the outstanding Shares of the Corporation, the Subscriber
                                         will have the right (but not the obligation) to nominate one person (the “Nominee”)
                                         to act as a director of the Corporation at each meeting of Shareholders at which directors
                                         of the Corporation are to be elected, provided that any such nominee consents in writing
                                         to serve as a director and is subject to acceptance by the CSE or any other applicable
                                         securities regulatory authority of such nominee’s Personal Information Form.

 

		(b)	The
                                         Corporation shall promptly take all steps as may be necessary to appoint, within ten
                                         Business Days of such person’s nomination, the initial Nominee to serve on the
                                         Board until the next meeting of Shareholders.

 

		(c)	In
                                         the event that the size of the Board is increased at any time following the Closing Date,
                                         and provided that the Subscriber’s Percentage
                                         Equity Ownership Interest equals or exceeds 5% of the outstanding Shares of the Corporation,
                                         the number of persons the Subscriber is
                                         entitled to designate to be nominated, appointed and serve as directors of the Corporation,
                                         shall be increased to such number, rounded up to the closest number of directors, as
                                         is equal to the Subscriber’s percentage ownership interest in
                                         the Corporation multiplied by the number of directors comprising the Board.

 

		(d)	So
                                         long as the Subscriber’s Percentage Equity Ownership Interest equals or exceeds
                                         5% of the outstanding Shares of the Corporation, the Corporation shall cause the Nominee
                                         to be included in the slate of nominees proposed by the Board to its Shareholders for
                                         approval as directors at each meeting of the Shareholders where directors are to be elected
                                         by Shareholders.

 

		(e)	The
                                         Corporation shall use all reasonable efforts to cause the election of the Nominee, including
                                         soliciting proxies in favour of the election of the Nominee.

 

		(f)	The
                                         Corporation shall notify the Subscriber in writing immediately upon determining the date
                                         of any meeting wherein directors are to be elected.

 

		(g)	The
                                         Subscriber shall, after consultation with the Corporation in good faith, advise the Corporation
                                         of the identity of the Nominee at least fifteen Business Days prior to the date on which
                                         proxy solicitation materials are to be mailed by the Corporation (as advised by the Corporation
                                         to the Subscriber at least 25 Business Days prior to such date) for purposes of any meeting
                                         of Shareholders at which directors are to be elected. If the Subscriber does not advise
                                         the Corporation of the identity of the Nominee prior to such deadline, then the Subscriber
                                         will be deemed to have nominated the incumbent Nominee(s).

    - 21 -

     

    

		(h)	If
                                         any Nominee ceases to hold office as a director of the Corporation for any reason (including
                                         death, disability, resignation or removal by the Subscriber), the Subscriber shall be
                                         entitled to nominate an individual (so long as such individual has been accepted by the
                                         CSE or any other applicable securities regulatory authority) to replace him or her and
                                         the Corporation shall promptly take all steps as may be necessary to appoint, within
                                         ten Business Days of such nomination, such individual to the Board to replace the Nominee
                                         who has ceased to hold office. Any such succeeding individual shall thereafter be a Nominee.

 

		(i)	The
                                         Corporation hereby agrees that it shall cause the management of the Corporation to, in
                                         respect of every meeting of Shareholders at which the election of the directors is to
                                         be considered, and at every reconvened meeting following an adjournment or postponement
                                         thereof, endorse and recommend each Nominee identified in the Company’s proxy materials
                                         for election to the Board so long as such Nominee has been accepted by the CSE or any
                                         other applicable securities regulatory authority, and shall vote the Shares in respect
                                         of which management is granted a discretionary proxy in favour of the election of such
                                         Nominee to the Board at every such meeting.

 

		(j)	The
                                         Corporation shall, subject to applicable corporate Laws, indemnify and hold harmless
                                         each Nominee (and his or her respective estates and heirs) (collectively, the “Nominee
                                         Indemnitees”) from and against any and all damage, loss, liability and expense
                                         (including reasonable expenses of investigation and reasonable attorneys’ fees and expenses)
                                         incurred by the Nominee Indemnitee before, on or after the date of this Agreement (collectively,
                                         the “Indemnified Liabilities”), arising out of any actual or threatened
                                         action, cause of action, suit, proceeding or claim arising directly or indirectly out
                                         of the Nominee Indemnitees’ status as a director of the Corporation or a member
                                         of any committee of the Board; provided that if and to the extent that the foregoing
                                         undertaking may be unavailable or unenforceable for any reason, the Corporation hereby
                                         agrees to make the maximum contribution to the payment and satisfaction of each of the
                                         Indemnified Liabilities which is permissible under applicable Law. The rights of the
                                         Nominee Indemnitees to indemnification hereunder shall be in addition to any other rights
                                         the Nominee Indemnitees may have under any other agreement to which the Nominee Indemnitees
                                         are or become a party or is or otherwise become a beneficiary or under Law or regulation
                                         or under the constating documents or insurance policies of the Corporation and shall
                                         extend to the Nominee Indemnitees’ successors and assigns.

 

		(k)	Each
                                         Nominee Indemnitee shall be entitled to the benefit of any directors’ liability
                                         insurance or indemnity to which other directors of the Corporation are entitled. Upon
                                         the request of the Subscriber, the Corporation shall enter into such indemnity agreements
                                         with the Nominee Indemnitees as requested by the Subscriber.

 

Section
15. Formation of a Advisory Committee

 

		(a)	The
                                         Corporation will, within ten Business Days following the Closing Date, establish an advisory
                                         committee (the “Advisory Committee”), through which the Subscriber
                                         will provide advice and recommendations with respect to technical and strategic decisions
                                         to be taken in furtherance of the exploration and development of the Project. For greater
                                         certainty, the Advisory Committee shall be a committee of the Corporation and, for the
                                         avoidance of doubt, shall not be (and shall not be deemed to be) a committee of the Board.
                                         The Advisory Committee shall have an opportunity to consider and provide suggestions
                                         with respect to material decisions in respect of the Project and management of the Corporation
                                         shall give reasonable consideration to any advice or recommendations made by the Advisory
                                         Committee (provided that, for greater certainty, the role of the Advisory Committee is
                                         to provide advice to management of the Corporation on technical and other matters, and
                                         any recommendations of the Advisory Committee shall not be binding upon the Corporation
                                         and shall not override the fiduciary duty of directors and officers of the Corporation
                                         or fetter their discretion in any way whatsoever). 

    - 22 -

     

    

		(b)	In
                                         particular, but without limitation, the Corporation will provide monthly reports to the
                                         Advisory Committee with respect to developments at the Project and the Advisory Committee
                                         shall meet monthly to discuss and provide advice to management of the Corporation with
                                         respect to the Project, including: (A) technical aspects of the exploration, development
                                         mining feasibility, and mining operations of the Project; (B) matters relating to the
                                         technical performance of the Project; (C) any other technical matters which are anticipated
                                         to, in the Advisory Committee’s opinion, maximize the technical performance of
                                         the Project; (D) senior staffing matters; (E) each prefeasibility study, feasibility
                                         study, preliminary economic assessment, economic assessment, life of mine plan and each
                                         annual budget; (C) material capital expenditures; and (D) any decision to materially
                                         expand, suspend or terminate any type of operations at the Project.

 

		(c)	The
                                         Advisory Committee shall be comprised of four members, two of whom shall be appointed
                                         by the Subscriber and two of whom shall be appointed by the Corporation. Each of the
                                         Subscriber and the Corporation may appoint one or more alternates to act in the absence
                                         of one or more of its regular members. Any alternate so acting will be deemed to be a
                                         member.

 

		(d)	A
                                         member appointed by the Corporation shall act as the chairperson of the Advisory Committee.
                                         The chairperson of the Advisory Committee shall not, in the case of an equality of votes,
                                         have a second or casting vote.

 

		(e)	Either
                                         the Subscriber or the Corporation may at any time, upon notice to the other party, remove
                                         any of their appointees on the Advisory Committee and appoint another individual in his
                                         or her place. Any appointment or removal of a member or alternate (including the address
                                         for service of each member or alternate and any subsequent change in those addresses)
                                         must be notified in writing by the appointing party to the Chief Executive Officer of
                                         the Corporation and the other party. The relevant appointment or removal will take effect
                                         immediately on delivery of such notice.

 

		(f)	The
                                         Subscriber and the Corporation shall, within 30 days of the Closing Date, establish protocols
                                         for calling and holding of meetings of such Advisory Committee.

 

Section
16. Right of First Offer/Right of First Refusal

 

For
a period of six months from the Closing Date, the Subscriber shall be granted a right of first offer as well as a right of first
refusal to acquire any interest, including a joint venture interest, in the Project, on terms and conditions that include the
following:

 

		(a)	In
                                         the event that the Corporation shall seek to directly or indirectly sell any interest,
                                         including a joint venture interest, in the Project (the “ROFO Offered Interest”),
                                         it shall by notice (the “ROFO Notice”) first offer the same to the
                                         Subscriber, setting out the material terms and conditions attaching to such sale. The
                                         Subscriber shall have a period of 60 days to determine whether it shall purchase the
                                         ROFO Offered Interest. If the Subscriber shall elect to purchase the ROFO Offered Interest,
                                         the Subscriber and the Corporation shall negotiate in good faith and shall complete the
                                         purchase and sale of the ROFO Offered Interest within a further period of 30 days, on
                                         substantially the terms and conditions set out in the ROFO Notice.

 

		(b)	In
                                         the event that the Subscriber shall not (i) elect to purchase the ROFO Offered Interest
                                         or (ii) complete the purchase of the ROFO Offered Interest, then the Corporation shall
                                         have the right to complete the sale of the ROFO Offered Interest with a third party provided
                                         that the transaction is on substantially the same terms and conditions set out in the
                                         ROFO Notice and provided that the transaction shall be completed within a period of 60
                                         days after the Offer Rejection Date, failing which, the right of first offer/right of
                                         first refusal granted to the Subscriber shall revive.

 

		(c)	In
the event that the Corporation does not send a ROFO Notice to the Subscriber and the Corporation receives an offer from a third
party (the “ROFR Offer”) to acquire, directly or indirectly, any interest, including a joint venture interest,
in the Project (the “ROFR Offered Interest”), then the Corporation shall send a copy of the ROFR Offer to the
Subscriber together

    - 23 -

     

    

with
an offer to the Subscriber to acquire the ROFR Offered Interest on the same terms and conditions as set out in the ROFR Offer.
The Subscriber shall have a period of 60 days to determine whether it shall purchase the ROFR Offered Interest. If the Subscriber
shall elect to purchase the ROFR Offered Interest, the Subscriber and Rise shall negotiate in good faith and shall complete the
purchase and sale of the ROFR Offered Interest within a further period of 30 days, on substantially the terms and conditions set
out in the ROFR Notice.

 

		(d)	If
                                         the Subscriber shall not (i) elect to purchase the ROFR Offered Interest or (ii) 
                                         complete the purchase of the ROFR Offered Interest, then the Corporation shall have the
                                         right to complete the sale of the ROFR Offered Interest with the third party, provided
                                         that the transaction is completed on substantially the same terms and conditions as set
                                         out in the ROFR Offer and provided that the transaction shall be completed within a period
                                         of 45 days after the Offer Rejection Date, failing which, the right of first offer/right
                                         of first refusal granted to the Subscriber hereunder shall revive.

 

		(e)	It
                                         is additionally understood and agreed that the Subscriber shall have the right to direct
                                         that a wholly-owned subsidiary be the counterparty that shall complete the transaction
                                         and that the applicable parties shall use their commercially reasonable efforts to reach
                                         agreement as to the definitive agreement that shall apply with respect to the ROFO Offered
                                         Interest or ROFR Offered Interest, as applicable.

 

Section
17. Authorization

 

The
Subscriber authorizes the Corporation to provide to the applicable securities regulator(s) or stock exchange such personal information
of the Subscriber as may be required.

 

Section
18. Notice

 

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

 

		(a)	the
                                         Corporation, be addressed to:

 

Rise
Gold Corp.

650
– 669 Howe Street

Vancouver,
BC V6C 0B4

 

Attention:
Vince Boon

Tel:
778-725-1484

Email:
vboon@jproust.ca

 

with
a copy to the Corporation’s counsel (which shall not constitute notice):

 

Thomas,
Rondeau LLP

1780
– 400 Burrard Street

Vancouver,
BC V6C 3A6

 

Attention:
Dale A. Rondeau

Email: drondeau@thomasrondeau.com

 

		(b)	the
                                         Subscriber, be addressed to:

 

the
name and address of the Subscriber set out on the face page of the Agreement

 

or
to such other address, email address or person that the Party designates by notice given in accordance with the foregoing provisions.
Any such notice: (i) if delivered personally or by courier, will be deemed to have been given and received on the date of such
delivery provided that if such day is not a

    - 24 -

     

    

Business Day then it will be deemed to have been given and received on the first Business
Day following such day; and (ii) if transmitted by email or other form of electronic communication, will be deemed to have been
given on the date of transmission if sent before 5:00 p.m. (Vancouver time) on a Business Day or, if not before 5:00 p.m. (Vancouver
time), on the first Business Day following the date of transmission provided that the sender has evidence of a successful transmission
such as a confirmation or electronic delivery receipt.

 

Section
19. Electronic Delivery

 

The
Subscriber consents to the electronic delivery of any documents required to be delivered by the Corporation to holders of any
Securities, including prospectuses, financial statements and proxy related materials, unless the method of delivery is mandated
by governing legislation and does not include electronic delivery. Such electronic delivery shall be made to the Subscriber’s
email address as provided in this Agreement.

 

Section
20. Costs

 

The
Subscriber acknowledges and agrees that all costs and expenses incurred by the Subscriber, including any fees and disbursements
of any advisor retained by the Subscriber relating to the purchase of the Units, or to the subsequent transfer by the Subscriber
of any of the Securities, will be borne by the Subscriber.

 

Section
21. Entire Agreement

 

This
Agreement represents the entire agreement of the parties hereto relating to the subject matter hereof and there are no representations,
covenants or other agreements relating to the subject matter hereof except as stated or referred to herein. Neither this Agreement
nor any provision hereof shall be modified, changed, discharged or terminated except by an instrument in writing signed by the
party against whom any waiver, change, discharge or termination is sought. If an ambiguity or question of intent or interpretation
arises, this Agreement shall be construed as if it is drafted by both parties, and no presumption or burden of proof shall arise
favoring or disfavoring either party by virtue of authorship of any of the provisions of this Agreement.

 

Section
22. Governing Law

 

This
Agreement and all related agreements between the Parties hereto shall be governed by and construed in accordance with the Laws
of the Province of British Columbia and the Laws of Canada applicable therein, without reference to its rules governing the choice
or conflict of laws. The Parties hereto irrevocably attorn and submit to the exclusive jurisdiction of the courts of the Province
of British Columbia, sitting in the city of Vancouver, with respect to any dispute to or arising out of this Agreement.

 

Section
23. Enurement & Assignment

 

The
terms and provisions of this Agreement shall be binding upon and enure to the benefit of the Subscriber and the Corporation and
their respective successors and permitted assigns; provided that, except for the assignment by the Subscriber if it is acting
as nominee or agent for a beneficial purchaser and as otherwise herein provided, this Agreement shall not be assignable by either
party without the prior written consent of the other party.

 

Section
24. Counterparts

 

This
Agreement may be executed in as many counterparts as may be necessary and delivered by electronic transmission, each of which
will be deemed to be an original and such counterparts together will constitute one and the same instrument.

    - 25 -

     

    

Section
25. Currency

 

All
references to currency in this Agreement are to Canadian dollars unless otherwise indicated.

 

Section
26. Time of Essence

 

Time
shall be of the essence of this Agreement.

 

Section
27. Headings

 

The
headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the interpretation of
this Agreement.

 

Section
28. Third Party Beneficiaries

 

This
Agreement (and in particular the registration rights provisions set forth in Schedule “C”) is intended for the benefit
of the parties hereto and their respective permitted successors and assigns, and is not for the benefit of, nor may any provision
hereof be enforced by, any other person.

- 26 -Blueprint

Exhibit
10.1

 

NEITHER
THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS
CONVERTIBLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE
UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), AND,
ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND
IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY
A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE
SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY.
THIS SECURITY AND THE SECURITIES ISSUABLE UPON CONVERSION OF THIS
SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN
ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.

 

Original
Issue Date: July 11,
2018

$60,000

 

8% CONVERTIBLE PROMISSORY NOTE

DUE OCTOBER 31, 2018

 

THIS 8%
CONVERTIBLE PROMISSORY NOTE is a duly authorized and validly issued
8% Convertible Promissory Note of Premier Biomedical, Inc. (the
“Company”),
having its principal place of business at P.O. Box 25, Jackson Center, PA 16133,
designated as its 8% Convertible Note due October 31, 2018 (this
Note, the “Note”
and, collectively with the other Notes of such series, the
“Notes”).

 

FOR
VALUE RECEIVED, the Company promises to pay, in cash, to
SEG-RedaShex, LLC or its registered assigns (the
“Holder”), or
shall have paid pursuant to the terms hereunder, the principal sum
of $60,000 on October 31, 2018 (the “Maturity Date”) or such earlier
date as this Note is required or permitted to be repaid as provided
hereunder, and to pay interest to the Holder on the aggregate
unconverted and then outstanding principal amount of this Note in
accordance with the provisions hereof. This Note is subject to the
following additional provisions:

 

Section
1.        
Definitions. For
the purposes hereof, in addition to the terms defined elsewhere in
this Note, (a) capitalized terms not otherwise defined herein shall
have the meanings set forth in the Exchange Agreement and (b) the
following terms shall have the following meanings:

 

“Alternate Consideration” shall
have the meaning set forth in Section 5(d).

 

“Alternative Conversion Price”
means 50% of the lowest traded price of the Common Stock in the
fifteen (15) Trading Days prior to the Conversion
Date.

 

 

 

 

 “Bankruptcy
Event” means any of the following events: (a) the
Company or any Significant Subsidiary (as such term is defined in
Rule 1-02(w) of Regulation S-X) thereof commences a case or other
proceeding under any bankruptcy, reorganization, arrangement,
adjustment of debt, relief of debtors, dissolution, insolvency or
liquidation or similar law of any jurisdiction relating to the
Company or any Significant Subsidiary thereof, (b) there is
commenced against the Company or any Significant Subsidiary thereof
any such case or proceeding that is not dismissed within 60 days
after commencement, (c) the Company or any Significant Subsidiary
thereof is adjudicated insolvent or bankrupt or any order of relief
or other order approving any such case or proceeding is entered,
(d) the Company or any Significant Subsidiary thereof suffers any
appointment of any custodian or the like for it or any substantial
part of its property that is not discharged or stayed within 60
calendar days after such appointment, (e) the Company or any
Significant Subsidiary thereof makes a general assignment for the
benefit of creditors, (f) the Company or any Significant Subsidiary
thereof calls a meeting of its creditors with a view to arranging a
composition, adjustment or restructuring of its debts or (g) the
Company or any Significant Subsidiary thereof, by any act or
failure to act, expressly indicates its consent to, approval of or
acquiescence in any of the foregoing or takes any corporate or
other action for the purpose of effecting any of the
foregoing.

 

“Base Conversion Price” shall have
the meaning set forth in Section 5(b).

 

“Beneficial Ownership Limitation”
shall have the meaning set forth in

Section 4(d).

 

“Buy-In” shall have the meaning set
forth in Section
4(c)(v).

 

“Change of Control Transaction”
means the occurrence after the date hereof of any of (a) an
acquisition after the date hereof by an individual or legal entity
or “group” (as described in Rule 13d-5(b)(1)
promulgated under the Exchange Act) of effective control (whether
through legal or beneficial ownership of capital stock of the
Company, by contract or otherwise) of in excess of 50% of the
voting securities of the Company (other than by means of conversion
or exercise of the Notes and the Securities issued together with
the Notes), (b) the Company merges into or consolidates with any
other Person, or any Person merges into or consolidates with the
Company and, after giving effect to such transaction, the
stockholders of the Company immediately prior to such transaction
own less than 50% of the aggregate voting power of the Company or
the successor entity of such transaction, (c) the Company sells or
transfers all or substantially all of its assets to another Person
and the stockholders of the Company immediately prior to such
transaction own less than 50% of the aggregate voting power of the
acquiring entity immediately after the transaction, or (d) the
execution by the Company of an agreement to which the Company is a
party or by which it is bound, providing for any of the events set
forth in clauses (a) through (c) above.

 

“Conversion” shall have the meaning
ascribed to such term in Section 4.

 

“Conversion Date” shall have the
meaning set forth in Section 4(a).

 

“Conversion Price” shall have the
meaning set forth in Section 4(b).

 

“Conversion Schedule” means the
Conversion Schedule in the form of Schedule 1 attached
hereto.

 

 

Page 2 of
18

 

 

 

“Conversion Shares” means,
collectively, the shares of Common Stock issuable upon conversion
of this Note in accordance with the terms hereof.

 

“Dilutive Issuance” shall have the
meaning set forth in Section 5(b).

 

“Dilutive Issuance Notice” shall
have the meaning set forth in Section 5(b).

 

“DTC” means the Depository Trust
Company.

 

“DTC/FAST
Program” means the
DTC’s Fast Automated Securities Transfer
Program.

 

“DWAC
Eligible” means that (a)
the Common Stock is eligible at DTC for full services pursuant to
DTC’s Operational Arrangements, (b) the Company has been
approved (without revocation) by the DTC’s underwriting
department, (c) the Transfer Agent is approved as an agent in the
DTC/FAST Program, and (d) the Transfer Agent does not have a policy
prohibiting or limiting delivery of the Conversion Shares via
DWAC.

 

“Event of
Default” shall have the
meaning set forth in Section
6(a).

 

“Exchange Agreement” means the
Exchange Agreement, dated as of August 8, 2017
between the Company and the original Holder, as amended, modified
or supplemented from time to time in accordance with its
terms.

 

“Fundamental Transaction” shall
have the meaning set forth in Section 5(d).

 

“Late Fees” shall have the meaning
set forth in Section
2(c).

 

“Mandatory Default Amount” means
the payment of 130% of the outstanding principal amount of this
Note and accrued and unpaid interest hereon, in addition to the
payment of all other amounts, costs, expenses and liquidated
damages due in respect of this Note.

 

“New York Courts” shall have the
meaning set forth in Section 7(d).

 

“Note Register” shall have the
meaning set forth in Section 2(b).

 

“Notice of Conversion” shall have
the meaning set forth in Section 4(a).

 

“Original Issue Date” means the
date of the first issuance of this Note, regardless of any
transfers of any Note and regardless of the number of instruments
which may be issued to evidence such Notes.

 

“Registration Statement” means a
registration statement covering the resale of the Underlying Shares
by each Holder.

 

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

 

 

Page 3 of
18

 

 

 

 

“Share Delivery Date” shall have
the meaning set forth in Section 4(c)(ii).

 

“Successor Entity” shall have the
meaning set forth in Section 5(d).

 

Section 2.    
         Interest.

 

a) Payment of Interest in Cash or
Kind. The Company shall pay interest to the Holder on the
aggregate unconverted and then outstanding principal amount of this
Note at the rate of 8% per annum, which interest amount shall be
guaranteed. All interest payments hereunder will be payable in cash
or Common Stock in the Holder’s discretion. Accrued and
unpaid interest shall be due and payable on each Conversion Date
and on the Maturity Date, or as otherwise set forth
herein.

 

b) Interest Calculations. Interest
shall be calculated on the basis of a 360-day year, consisting of
twelve 30 calendar day periods, and shall accrue daily commencing
on the Original Issue Date until payment in full of the outstanding
principal, together with all accrued and unpaid interest,
liquidated damages and other amounts which may become due
hereunder, has been made. Interest hereunder will be paid to the
Person in whose name this Note is registered on the records of the
Company regarding registration and transfers of this Note (the
“Note
Register”).

 

c) Late
Fee. All overdue accrued and unpaid interest to be paid
hereunder shall entail a late fee at an interest rate equal to the
lesser of 8% per annum or the maximum rate permitted by applicable
law (the “Late
Fees”) which shall accrue daily from the date such
interest is due hereunder through and including the date of actual
payment in full.

 

d) Prepayment. At any time upon
ten (10) days written notice to the Holder, the Company may prepay
any portion of the principal amount of this Note and any accrued
and unpaid interest. If the Company
exercises its right to prepay the Note, the Company shall make
payment to the Holder of an amount in cash equal to the sum of the
then outstanding principal amount of this Note and interest
multiplied by 130%. The Holder may continue to convert the
Note from the date notice of the prepayment is given until the date
of the prepayment.

 

Section
3.                      Registration
of Transfers and Exchanges.

 

a) Different Denominations. This
Note is exchangeable for an equal aggregate principal amount of
Notes of different authorized denominations, as requested by the
Holder surrendering the same. No service charge will be payable for
such registration of transfer or exchange.

 

b) Investment Representations.
This Note has been issued subject to certain investment
representations of the original Holder set forth in the Exchange
Agreement and may be transferred or exchanged only in compliance
with the Exchange Agreement and applicable federal and state
securities laws and regulations.

 

 

Page 4 of
18

 

 

 

c) Reliance on Note Register.
Prior to due presentment for transfer to the Company of this Note,
the Company and any agent of the Company may treat the Person in
whose name this Note is duly registered on the Note Register as the
owner hereof for the purpose of receiving payment as herein
provided and for all other purposes, whether or not this Note is
overdue, and neither the Company nor any such agent shall be
affected by notice to the contrary.

 

Section
4.                      Conversion.

 

a) Voluntary Conversion. At any
time after the date of this Note, this Note shall be convertible,
in whole or in part, into shares of Common Stock at the option of
the Holder, from time to time (subject to the conversion
limitations set forth in Section 4(d) hereof). The
Holder shall effect conversions by delivering to the Company a
Notice of Conversion, the form of which is attached hereto as
Annex A (each, a
“Notice of
Conversion”), specifying therein the principal amount
of this Note to be converted and the date on which such conversion
shall be effected (such date, the “Conversion Date”). If no
Conversion Date is specified in a Notice of Conversion, the
Conversion Date shall be the date that such Notice of Conversion is
deemed delivered hereunder. No ink-original Notice of Conversion
shall be required, nor shall any medallion guarantee (or other type
of guarantee or notarization) of any Notice of Conversion form be
required. To effect
conversions hereunder, the Holder shall not be required to
physically surrender this Note to the Company unless the entire
principal amount of this Note, plus all accrued and unpaid interest
thereon, has been so converted. Conversions hereunder shall have
the effect of lowering the outstanding principal amount of this
Note in an amount equal to the applicable conversion. The Holder
and the Company shall maintain a Conversion Schedule showing the
principal amount(s) converted and the date of such conversion(s).
The Company may deliver an objection to any Notice of Conversion
within one (1) Business Day of delivery of such Notice of
Conversion. In the event of any dispute or discrepancy, the records
of the Holder shall be controlling and determinative in the absence
of manifest error. The Holder, and
any assignee by acceptance of this Note, acknowledge and agree
that, by reason of the provisions of this paragraph, following
conversion of a portion of this Note, the unpaid and unconverted
principal amount of this Note may be less than the amount stated on
the face hereof.

 

b) Conversion Price. The
conversion price (the “Conversion Price”) in effect on
any Conversion Date shall be equal to 60% of the lowest traded
price of the Common Stock in the fifteen (15) Trading Days prior to
the Conversion Date; provided that, except in the event the
Alternative Conversion Price is applicable pursuant to the
following sentence, the Conversion Price shall not be lower than
$0.00005. Notwithstanding anything herein to the contrary, at any
time after the occurrence of any Event of Default the Holder may
require the Company to, at such Holder’s option and otherwise
in accordance with the provisions for conversion herein, convert
all or any part of this Note into Common Stock at the Alternative
Conversion Price. All such foregoing determinations will be
appropriately adjusted for any stock dividend, stock split, stock
combination, reclassification or similar transaction that
proportionately decreases or increases the Common Stock during such
measuring period. Nothing herein shall limit a Holder’s right
to pursue actual damages or declare an Event of Default pursuant to
Section 6 hereof
and the Holder shall have the right to pursue all remedies
available to it hereunder, at law or in equity including, without
limitation, a decree of specific performance and/or injunctive
relief. The exercise of any such rights shall not prohibit the
Holder from seeking to enforce damages pursuant to any other
Section hereof or under applicable law.

 

 

Page 5 of
18

 

 

 

c)

Mechanics of
Conversion.

 

i. Conversion Shares Issuable Upon
Conversion of Principal Amount. The number of Conversion
Shares issuable upon a conversion hereunder shall be determined by
the quotient obtained by dividing (x) the outstanding principal
amount of this Note to be converted and any accrued and unpaid
interest to be converted by (y) the Conversion Price.

 

ii. Delivery of Certificate Upon
Conversion. Not later than three (3) Trading Days after each
Conversion Date (the “Share
Delivery Date”), the Company shall deliver, or cause
to be delivered, to the Holder (A) a certificate or certificates
representing the Conversion Shares which, on or after the date on
which such Conversion Shares are eligible to be sold under Rule 144
without the need for current public information and the Company has
received an opinion of counsel to such effect reasonably acceptable
to the Company (which opinion the Company will be responsible for
obtaining) shall be free of restrictive legends and trading
restrictions (other than those which may then be required by the
Exchange Agreement) representing the number of Conversion Shares
being acquired upon the conversion of this Note, and (B) payment in
the amount of accrued and unpaid interest (if the Company has
elected or is required to pay accrued interest in cash). All
certificate or certificates required to be delivered by the Company
under this Section
4(d) shall be delivered electronically through the
Depository Trust Company or another established clearing
corporation performing similar functions. If the Conversion Date is
prior to the date on which such Conversion Shares are eligible to
be sold under Rule 144 without the need for current public
information the Conversion Shares shall bear a restrictive legend
in substantially the following form, as appropriate:

 

“NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED
BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES
ARE EXERCISABLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE
SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR
ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION
STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE
SELECTED BY THE HOLDER), IN A GENERALLY ACCEPTABLE FORM, THAT
REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD
PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT. NOTWITHSTANDING
THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A
BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT
SECURED BY THE SECURITIES.”

 

 

Page 6 of
18

 

 

 

Notwithstanding
the foregoing, commencing on such date that the Conversion Shares
are eligible for sale under Rule 144 subject to current public
information requirements, the Company, upon request of the Holder,
shall obtain a legal opinion to allow for such sales under Rule
144.

 

iii. Failure
to Deliver Certificates. If, in the case of any Notice of
Conversion, such certificate or certificates are not delivered to
or as directed by the applicable Holder by the Share Delivery Date,
the Holder shall be entitled to elect by written notice to the
Company at any time on or before its receipt of such certificate or
certificates, to rescind such Conversion, in which event the
Company shall promptly return to the Holder any original Note
delivered to the Company and the Holder shall promptly return to
the Company the Common Stock certificates issued to such Holder
pursuant to the rescinded Conversion Notice.

 

iv. Obligation Absolute; Partial
Liquidated Damages. The Company’s obligations to issue
and deliver the Conversion Shares upon conversion of this Note in
accordance with the terms hereof are absolute and unconditional,
irrespective of any action or inaction by the Holder to enforce the
same, any waiver or consent with respect to any provision hereof,
the recovery of any judgment against any Person or any action to
enforce the same, or any setoff, counterclaim, recoupment,
limitation or termination, or any breach or alleged breach by the
Holder or any other Person of any obligation to the Company or any
violation or alleged violation of law by the Holder or any other
Person, and irrespective of any other circumstance which might
otherwise limit such obligation of the Company to the Holder in
connection with the issuance of such Conversion Shares;
provided,
however, that such
delivery shall not operate as a waiver by the Company of any such
action the Company may have against the Holder. In the event the
Holder of this Note shall elect to convert any or all of the
outstanding principal or interest amount hereof, the Company may
not refuse conversion based on any claim that the Holder or anyone
associated or affiliated with the Holder has been engaged in any
violation of law, agreement or for any other reason, unless an
injunction from a court, on notice to Holder, restraining and or
enjoining conversion of all or part of this Note shall have been
sought and obtained, and the Company posts a surety bond for the
benefit of the Holder in the amount of 150% of the outstanding
principal amount of this Note, which is subject to the injunction,
which bond shall remain in effect until the completion of
arbitration/litigation of the underlying dispute and the proceeds
of which shall be payable to the Holder to the extent it obtains
judgment. In the absence of such injunction, the Company shall
issue Conversion Shares or, if applicable, cash, upon a properly
noticed conversion. If the Company fails for any reason to deliver
to the Holder such certificate or certificates pursuant to
Section 4(c)(ii) by
the Share Delivery Date, the Company shall pay to the Holder, in
cash, as liquidated damages and not as a penalty, $500 per Trading
Day for each Trading Day after such Share Delivery Date until such
certificates are delivered or Holder rescinds such conversion.
Nothing herein shall limit a Holder’s right to pursue actual
damages or declare an Event of Default pursuant to Section 6 hereof for the
Company’s failure to deliver Conversion Shares within the
period specified herein and the Holder shall have the right to
pursue all remedies available to it hereunder, at law or in equity
including, without limitation, a decree of specific performance
and/or injunctive relief. The exercise of any such rights shall not
prohibit the Holder from seeking to enforce damages pursuant to any
other Section hereof or under applicable law.

 

 

 

Page 7 of
18

 

 

 

v. Compensation for Buy-In on Failure to
Timely Deliver Certificates Upon Conversion. In addition to
any other rights available to the Holder, if the Company fails for
any reason to deliver to the Holder such certificate or
certificates by the Share Delivery Date pursuant to Section 4(c)(ii), and if after
such Share Delivery Date the Holder is required by its brokerage
firm to purchase (in an open market transaction or otherwise), or
the Holder’s brokerage firm otherwise purchases, shares of
Common Stock to deliver in satisfaction of a sale by the Holder of
the Conversion Shares which the Holder was entitled to receive upon
the conversion relating to such Share Delivery Date (a
“Buy-In”), then
the Company shall (A) pay in cash to the Holder (in addition to any
other remedies available to or elected by the Holder) the amount,
if any, by which (x) the Holder’s total purchase price
(including any brokerage commissions) for the Common Stock so
purchased exceeds (y) the product of (1) the aggregate number of
shares of Common Stock that the Holder was entitled to receive from
the conversion at issue multiplied by (2) the actual sale price at
which the sell order giving rise to such purchase obligation was
executed (including any brokerage commissions) and (B) at the
option of the Holder, either reissue (if surrendered) this Note in
a principal amount equal to the principal amount of the attempted
conversion (in which case such conversion shall be deemed
rescinded) or deliver to the Holder the number of shares of Common
Stock that would have been issued if the Company had timely
complied with its delivery requirements under Section 4(c)(ii). For example,
if the Holder purchases Common Stock having a total purchase price
of $11,000 to cover a Buy-In with respect to an attempted
conversion of this Note with respect to which the actual sale price
of the Conversion Shares (including any brokerage commissions)
giving rise to such purchase obligation was a total of $10,000
under clause (A) of the immediately preceding sentence, the Company
shall be required to pay the Holder $1,000. The Holder shall
provide the Company written notice indicating the amounts payable
to the Holder in respect of the Buy-In and, upon request of the
Company, evidence of the amount of such loss. Nothing herein shall
limit a Holder’s right to pursue any other remedies available
to it hereunder, at law or in equity including, without limitation,
a decree of specific performance and/or injunctive relief with
respect to the Company’s failure to timely deliver
certificates representing shares of Common Stock upon conversion of
this Note as required pursuant to the terms hereof.

 

vi. Reservation of Shares Issuable Upon
Conversion. The Company covenants that it will at all times
reserve and keep available out of its authorized and unissued
shares of Common Stock a number of shares of Common Stock at least
equal to 300% of the Required Minimum for the sole purpose of
issuance upon conversion of this Note and payment of interest on
this Note, each as herein provided, free from preemptive rights or
any other actual contingent purchase rights of Persons other than
the Holder (and the other holders of the Notes), not less than such
aggregate number of shares of the Common Stock as shall (subject to
the terms and conditions set forth in the Exchange Agreement) be
issuable (taking into account the adjustments and restrictions of
Section 5) upon the
conversion of the then outstanding principal amount of this Note
and payment of interest hereunder. The Company covenants that all
shares of Common Stock that shall be so issuable shall, upon issue,
be duly authorized, validly issued, fully paid and
nonassessable.

 

vii. Fractional
Shares. No fractional shares or scrip representing
fractional shares shall be issued upon the conversion of this Note.
As to any fraction of a share which the Holder would otherwise be
entitled to purchase upon such conversion, the Company shall at its
election, either pay a cash adjustment in respect of such final
fraction in an amount equal to such fraction multiplied by the
Conversion Price or round up to the next whole share.

 

 

Page 8 of
18

 

 

 

viii. Transfer
Taxes and Expenses. The issuance of certificates for shares
of the Common Stock on conversion of this Note shall be made
without charge to the Holder hereof for any documentary stamp or
similar taxes that may be payable in respect of the issue or
delivery of such certificates, provided that, the Company shall not
be required to pay any tax that may be payable in respect of any
transfer involved in the issuance and delivery of any such
certificate upon conversion in a name other than that of the Holder
of this Note so converted and the Company shall not be required to
issue or deliver such certificates unless or until the Person or
Persons requesting the issuance thereof shall have paid to the
Company the amount of such tax or shall have established to the
satisfaction of the Company that such tax has been paid. The
Company shall pay all Transfer Agent fees required for same-day
processing of any Notice of Conversion.

 

d) Holder’s Conversion
Limitations. The Company shall not effect any conversion of
principal and/or interest of this Note, and a Holder shall not have
the right to convert any principal and/or interest of this Note, to
the extent that after giving effect to the conversion set forth on
the applicable Notice of Conversion, the Holder (together with the
Holder’s Affiliates, and any Persons acting as a group
together with the Holder or any of the Holder’s Affiliates)
would beneficially own in excess of the Beneficial Ownership
Limitation (as defined below). For purposes of the foregoing
sentence, the number of shares of Common Stock beneficially owned
by the Holder and its Affiliates shall include the number of shares
of Common Stock issuable upon conversion of this Note with respect
to which such determination is being made, but shall exclude the
number of shares of Common Stock which are issuable upon (i)
conversion of the remaining, unconverted principal amount of this
Note beneficially owned by the Holder or any of its Affiliates and
(ii) exercise or conversion of the unexercised or unconverted
portion of any other securities of the Company subject to a
limitation on conversion or exercise analogous to the limitation
contained herein (including, without limitation, any other Notes)
beneficially owned by the Holder or any of its Affiliates. Except
as set forth in the preceding sentence, for purposes of this
Section 4(d),
beneficial ownership shall be calculated in accordance with Section
13(d) of the Exchange Act and the rules and regulations promulgated
thereunder. To the extent that the limitation contained in this
Section 4(d)
applies, the determination of whether this Note is convertible (in
relation to other securities owned by the Holder together with any
Affiliates) and of which principal amount of this Note is
convertible shall be in the sole discretion of the Holder, and the
submission of a Notice of Conversion shall be deemed to be the
Holder’s determination of whether this Note may be converted
(in relation to other securities owned by the Holder together with
any Affiliates) and which principal amount of this Note is
convertible, in each case subject to the Beneficial Ownership
Limitation. To ensure compliance with this restriction, the Holder
will be deemed to represent to the Company each time it delivers a
Notice of Conversion that such Notice of Conversion has not
violated the restrictions set forth in this paragraph and the
Company shall have no obligation to verify or confirm the accuracy
of such determination. In addition, a
determination as to any group status as contemplated above shall be
determined in accordance with Section 13(d) of the Exchange
Act and the rules and regulations promulgated
thereunder. For purposes of
this Section 4(d),
in determining the number of outstanding shares of Common Stock,
the Holder may rely on the number of outstanding shares of Common
Stock as stated in the most recent of the following: (i) the
Company’s most recent periodic or annual report filed with
the Commission, as the case may be, (ii) a more recent public
announcement by the Company, or (iii) a more recent written notice
by the Company or the Company’s transfer agent setting forth
the number of shares of Common Stock outstanding. Upon the written
or oral request of a Holder, the Company shall within two Trading
Days confirm orally and in writing to the Holder the number of
shares of Common Stock then outstanding. In any case, the number of
outstanding shares of Common Stock shall be determined after giving
effect to the conversion or exercise of securities of the Company,
including this Note, by the Holder or its Affiliates since the date
as of which such number of outstanding shares of Common Stock was
reported. The “Beneficial
Ownership Limitation” shall be 4.99% of the number of
shares of the Common Stock outstanding immediately after giving
effect to the issuance of shares of Common Stock issuable upon
conversion of this Note held by the Holder. The Holder, upon not
less than 61 days’ prior notice to the Company, may increase
or decrease the Beneficial Ownership Limitation provisions of this
Section 4(d),
provided that the Beneficial Ownership Limitation in no event
exceeds 9.99% of the number of shares of the Common Stock
outstanding immediately after giving effect to the issuance of
shares of Common Stock upon conversion of this Note held by the
Holder and the Beneficial Ownership Limitation provisions of this
Section 4(d) shall
continue to apply. Any such increase or decrease will not be
effective until the 61st day after such
notice is delivered to the Company. The Beneficial Ownership
Limitation provisions of this paragraph shall be construed and
implemented in a manner otherwise than in strict conformity with
the terms of this Section
4(d) to correct this paragraph (or any portion hereof) which
may be defective or inconsistent with the intended Beneficial
Ownership Limitation contained herein or to make changes or
supplements necessary or desirable to properly give effect to such
limitation.
The limitations contained in this
paragraph shall apply to a successor holder of this
Note.

 

 

 

Page 9 of
18

 

 

 

Section
5.                           
Certain
Adjustments.

 

a) Stock Dividends and Stock
Splits. If the Company, at any time while this Note is
outstanding: (i) pays a stock dividend or otherwise makes a
distribution or distributions payable in shares of Common Stock on
shares of Common Stock or any Common Stock Equivalents (which, for
avoidance of doubt, shall not include any shares of Common Stock
issued by the Company upon conversion of, or payment of interest
on, the Notes), (ii) subdivides outstanding shares of Common Stock
into a larger number of shares, (iii) combines (including by way of
a reverse stock split) outstanding shares of Common Stock into a
smaller number of shares or (iv) issues, in the event of a
reclassification of shares of the Common Stock, any shares of
capital stock of the Company, then the Conversion Price shall be
multiplied by a fraction of which the numerator shall be the number
of shares of Common Stock (excluding any treasury shares of the
Company) outstanding immediately before such event, and of which
the denominator shall be the number of shares of Common Stock
outstanding immediately after such event. Any adjustment made
pursuant to this Section
5 shall become effective immediately after the record date
for the determination of stockholders entitled to receive such
dividend or distribution and shall become effective immediately
after the effective date in the case of a subdivision, combination
or re-classification.

 

b) Subsequent Equity Sales. If, at
any time while this Note is outstanding, the Company or any
Subsidiary, as applicable, sells or grants any option to purchase
or sells or grants any right to reprice, or otherwise disposes of
or issues (or announces any sale, grant or any option to purchase
or other disposition), any Common Stock or Common Stock Equivalents
entitling any Person to acquire shares of Common Stock at an
effective price per share that is lower than the then Conversion
Price (such lower price, the “Base Conversion Price” and such
issuances, collectively, a “Dilutive Issuance”) (if the holder
of the Common Stock or Common Stock Equivalents so issued shall at
any time, whether by operation of purchase price adjustments, reset
provisions, floating conversion, exercise or exchange prices or
otherwise, or due to warrants, options or rights per share which
are issued in connection with such issuance, be entitled to receive
shares of Common Stock at an effective price per share that is
lower than the Conversion Price, such issuance shall be deemed to
have occurred for less than the Conversion Price on such date of
the Dilutive Issuance), then the Conversion Price shall be reduced
to equal the Base Conversion Price. Such adjustment shall be made
whenever such Common Stock or Common Stock Equivalents are issued.
Notwithstanding the foregoing, no
adjustment will be made under this Section 5(b)
in respect of an Exempt
Issuance. The Company shall notify the Holder in writing, no
later than the Trading Day following the issuance of any Common
Stock or Common Stock Equivalents subject to this Section 5(b), indicating
therein the applicable issuance price, or applicable reset price,
exchange price, conversion price and other pricing terms (such
notice, the “Dilutive
Issuance Notice”). For purposes of clarification,
whether or not the Company provides a Dilutive Issuance Notice
pursuant to this Section
5(b), upon the occurrence of any Dilutive Issuance, the
Holder will be entitled to receive a number of Conversion Shares
based upon the Base Conversion Price on or after the date of such
Dilutive Issuance, regardless of whether the Holder accurately
refers to the Base Conversion Price in the Notice of
Conversion.

 

c) Subsequent Rights Offerings.
In addition to any adjustments
pursuant to Section 5(a)
above, if at any time the Company
grants, issues or sells any Common Stock Equivalents or rights to
purchase stock, warrants, securities or other property pro rata to
the record holders of any class of shares of Common Stock (the
“Purchase
Rights”), then the Holder
will be entitled to acquire, upon the terms applicable to such
Purchase Rights, the aggregate Purchase Rights which the Holder
could have acquired if the Holder had held the number of shares of
Common Stock acquirable upon complete conversion of this Note
(without regard to any limitations on exercise hereof, including
without limitation, the Beneficial Ownership Limitation)
immediately before the date on which a record is taken for the
grant, issuance or sale of such Purchase Rights, or, if no such
record is taken, the date as of which the record holders of shares
of Common Stock are to be determined for the grant, issue or sale
of such Purchase Rights (provided, however, to the extent that the
Holder’s right to participate in any such Purchase Right
would result in the Holder exceeding the Beneficial Ownership
Limitation, then the Holder shall not be entitled to participate in
such Purchase Right to such extent (or beneficial ownership of such
shares of Common Stock as a result of such Purchase Right to such
extent) and such Purchase Right to such extent shall be held in
abeyance for the Holder until such time, if ever, as its right
thereto would not result in the Holder exceeding the Beneficial
Ownership Limitation).

 

 

 

Page 10 of
18

 

 

 

d) Fundamental Transaction. If, at
any time while this Note is outstanding, (i) the Company, directly
or indirectly, in one or more related transactions effects any
merger or consolidation of the Company with or into another Person,
(ii) the Company, directly or indirectly, effects any sale, lease,
license, assignment, transfer, conveyance or other disposition of
all or substantially all of its assets in one or a series of
related transactions, (iii) any, direct or indirect, purchase
offer, tender offer or exchange offer (whether by the Company or
another Person) is completed pursuant to which holders of Common
Stock are permitted to sell, tender or exchange their shares for
other securities, cash or property and has been accepted by the
holders of 50% or more of the outstanding Common Stock, (iv) the
Company, directly or indirectly, in one or more related
transactions effects any reclassification, reorganization or
recapitalization of the Common Stock or any compulsory share
exchange pursuant to which the Common Stock is effectively
converted into or exchanged for other securities, cash or property,
(v) the Company, directly or indirectly, in one or more related
transactions consummates a stock or share purchase agreement or
other business combination (including, without limitation, a
reorganization, recapitalization, spin-off or scheme of
arrangement) with another Person whereby such other Person acquires
more than 50% of the outstanding shares of Common Stock (not
including any shares of Common Stock held by the other Person or
other Persons making or party to, or associated or affiliated with
the other Persons making or party to, such stock or share purchase
agreement or other business combination) (each a
“Fundamental
Transaction”), then, upon any subsequent conversion of
this Note, the Holder shall have the right to receive, for each
Conversion Share that would have been issuable upon such conversion
immediately prior to the occurrence of such Fundamental Transaction
(without regard to any limitation in Section 4(d) on the conversion
of this Note), the number of shares of Common Stock of the
successor or acquiring corporation or of the Company, if it is the
surviving corporation, and any additional consideration (the
“Alternate
Consideration”) receivable as a result of such
Fundamental Transaction by a holder of the number of shares of
Common Stock for which this Note is convertible immediately prior
to such Fundamental Transaction (without regard to any limitation
in Section 4(d) on
the conversion of this Note). For purposes of any such conversion,
the determination of the Conversion Price shall be appropriately
adjusted to apply to such Alternate Consideration based on the
amount of Alternate Consideration issuable in respect of one (1)
share of Common Stock in such Fundamental Transaction, and the
Company shall apportion the Conversion Price among the Alternate
Consideration in a reasonable manner reflecting the relative value
of any different components of the Alternate Consideration. If
holders of Common Stock are given any choice as to the securities,
cash or property to be received in a Fundamental Transaction, then
the Holder shall be given the same choice as to the Alternate
Consideration it receives upon any conversion of this Note
following such Fundamental Transaction. The Company shall cause any
successor entity in a Fundamental Transaction in which the Company
is not the survivor (the “Successor Entity”) to assume in
writing all of the obligations of the Company under this Note and
the Exchange Agreement in accordance with the provisions of this
Section 5(d)
pursuant to written agreements in form and substance reasonably
satisfactory to the Holder and approved by the Holder (without
unreasonable delay) prior to such Fundamental Transaction and
shall, at the option of the holder of this Note, deliver to the
Holder in exchange for this Note a security of the Successor Entity
evidenced by a written instrument substantially similar in form and
substance to this Note which is convertible for a corresponding
number of shares of capital stock of such Successor Entity (or its
parent entity) equivalent to the shares of Common Stock acquirable
and receivable upon conversion of this Note (without regard to any
limitations on the conversion of this Note) prior to such
Fundamental Transaction, and with a conversion price which applies
the conversion price hereunder to such shares of capital stock (but
taking into account the relative value of the shares of Common
Stock pursuant to such Fundamental Transaction and the value of
such shares of capital stock, such number of shares of capital
stock and such conversion price being for the purpose of protecting
the economic value of this Note immediately prior to the
consummation of such Fundamental Transaction), and which is
reasonably satisfactory in form and substance to the Holder. Upon
the occurrence of any such Fundamental Transaction, the Successor
Entity shall succeed to, and be substituted for (so that from and
after the date of such Fundamental Transaction, the provisions of
this Note and the other Transaction Documents referring to the
“Company” shall refer instead to the Successor Entity),
and may exercise every right and power of the Company and shall
assume all of the obligations of the Company under this Note and
the other Transaction Documents with the same effect as if such
Successor Entity had been named as the Company herein.

 

e) Calculations. All calculations
under this Section
5 shall be made to the nearest cent or the nearest 1/100th
of a share, as the case may be. For purposes of this Section 5, the number of shares
of Common Stock deemed to be issued and outstanding as of a given
date shall be the sum of the number of shares of Common Stock
(excluding any treasury shares of the Company) issued and
outstanding.

 

f) Notice to the
Holder.

 

i. Adjustment to Conversion Price.
Whenever the Conversion Price is adjusted pursuant to any provision
of this Section 5,
the Company shall promptly deliver to each Holder a notice setting
forth the Conversion Price after such adjustment and setting forth
a brief statement of the facts requiring such
adjustment.

 

 

 

Page 11 of
18

 

 

 

ii. Notice
to Allow Conversion by Holder. If (A) the Company shall
declare a dividend (or any other distribution in whatever form) on
the Common Stock, (B) the Company shall declare a special
nonrecurring cash dividend on or a redemption of the Common Stock,
(C) the Company shall authorize the granting to all holders of the
Common Stock of rights or warrants to subscribe for or purchase any
shares of capital stock of any class or of any rights, (D) the
approval of any stockholders of the Company shall be required in
connection with any reclassification of the Common Stock, any
consolidation or merger to which the Company is a party, any sale
or transfer of all or substantially all of the assets of the
Company, or any compulsory share exchange whereby the Common Stock
is converted into other securities, cash or property or (E)
the Company shall authorize the
voluntary or involuntary dissolution, liquidation or winding up of
the affairs of the Company, then, in each case, the Company shall
cause to be filed at each office or agency maintained for the
purpose of conversion of this Note, and shall cause to be
delivered to the Holder at its last
address as it shall appear upon the Note Register, at least twenty
(20) calendar days prior to the applicable record or effective date
hereinafter specified, a notice stating (x) the date on
which a record is to be taken for the purpose of such dividend,
distribution, redemption, rights or warrants, or if a record is not
to be taken, the date as of which the holders of the Common Stock
of record to be entitled to such dividend, distributions,
redemption, rights or warrants are to be determined or (y) the date
on which such reclassification, consolidation, merger, sale,
transfer or share exchange is expected to become effective or
close, and the date as of which it is expected that holders of the
Common Stock of record shall be entitled to exchange their shares
of the Common Stock for securities, cash or other property
deliverable upon such reclassification, consolidation, merger,
sale, transfer or share exchange, provided that the failure to
deliver such notice or any defect therein or in the delivery
thereof shall not affect the validity of the corporate action
required to be specified in such notice. To the extent that any
notice provided hereunder constitutes, or contains, material,
non-public information regarding the Company or any of the
Subsidiaries, the Company shall simultaneously file such notice
with the Commission pursuant to a Current Report on Form 8-K. The
Holder shall remain entitled to convert this Note during the 20-day
period commencing on the date of such notice through the effective
date of the event triggering such notice except as may otherwise be
expressly set forth herein.

 

Section
6.            
Events of
Default.

 

a) “Event of Default” means,
wherever used herein, any of the following events (whatever the
reason for such event and whether such event shall be voluntary or
involuntary or effected by operation of law or pursuant to any
judgment, decree or order of any court, or any order, rule or
regulation of any administrative or governmental
body):

 

i. any
default in the payment of (A) the principal amount of any Note or
(B) interest, liquidated damages and other amounts owing to a
Holder on any Note, as and when the same shall become due and
payable (whether on a Conversion Date or the Maturity Date or by
acceleration or otherwise) which default, solely in the case of an
interest payment or other default under clause (B) above, is not
cured within 3 Trading Days;

 

ii. the
Company shall materially fail to observe or perform any other
material covenant or material agreement contained in the Notes
(other than a breach by the Company of its obligations to deliver
shares of Common Stock to the Holder upon conversion, which breach
is addressed in clause (ix) below) which failure is not cured, if
possible to cure, within the earlier to occur of (A) 5
Trading Days after notice of such failure sent by the Holder or by
any other Holder to the Company
and (B) 10 Trading Days after the Company has become or should have
become aware of such failure;

 

 

Page 12 of
18

 

 

 

iii. a
default or event of default (subject to any grace or cure period
provided in the applicable agreement, document or instrument) shall
occur under (A) any of the Transaction Documents or (B) any other
material agreement, lease, document or instrument to which the
Company or any Subsidiary is obligated (and not covered by clause
(vi) below);

 

iv. any representation or warranty made in this Note, any other
Transaction Documents, any written statement pursuant hereto or
thereto or any other report, financial statement or certificate
made or delivered to the Holder or any other Holder shall be untrue
or incorrect in any material respect as of the date when made or
deemed made;

 

v. the Company or any
Significant Subsidiary (as such term is defined in Rule 1-02(w) of
Regulation S-X) shall be subject to a Bankruptcy
Event;

 

vi. the Company or any
Subsidiary shall default on any of its obligations under any
mortgage, credit agreement or other facility, indenture agreement,
factoring agreement or other instrument under which there may be
issued, or by which there may be secured or evidenced, any
indebtedness for borrowed money or money due under any long term
leasing or factoring arrangement that (a) involves an obligation
greater than $100,000, whether such indebtedness now exists or
shall hereafter be created, and (b) results in such indebtedness
becoming or being declared due and payable prior to the date on
which it would otherwise become due and payable;

 

vii. the
Common Stock shall not be eligible for listing or quotation for
trading on a Trading Market and shall not be eligible to resume
listing or quotation for trading thereon within five Trading Days
or the transfer of shares of Common Stock through the Depository
Trust Company System is no longer available or
“chilled”;

 

viii. the
Company shall be a party to any Change of Control Transaction or
Fundamental Transaction or shall agree to sell or dispose of all or
in excess of 50% of its assets in one transaction or a series of
related transactions (whether or not such sale would constitute a
Change of Control Transaction);

 

ix. the
Company does not meet the current public information requirements
under Rule 144;

 

x. the Company fails
to file with the Commission any required reports under Section 13
or 15(d) of the Exchange Act such that it is not in compliance with
Rule 144(c)(1) (or Rule 144(i)(2), if applicable);

 

 

Page 13 of
18

 

 

 

xi. if the Company or
any Significant Subsidiary shall: (i) apply for or consent to the
appointment of a receiver, trustee, custodian or liquidator of it
or any of its properties, (ii) admit in writing its inability to
pay its debts as they mature, (iii) make a general assignment for
the benefit of creditors, (iv) be adjudicated bankrupt or insolvent
or be the subject of an order for relief under Title 11 of the
United States Code or any bankruptcy, reorganization, insolvency,
readjustment of debt, dissolution or liquidation law or statute of
any other jurisdiction or foreign country, or (v) file a voluntary
petition in bankruptcy, or a petition or an answer seeking
reorganization or an arrangement with creditors or to take
advantage or any bankruptcy, reorganization, insolvency,
readjustment of debt, dissolution or liquidation law or statute, or
an answer admitting the material allegations of a petition filed
against it in any proceeding under any such law, or (vi) take or
permit to be taken any action in furtherance of or for the purpose
of effecting any of the foregoing;

 

xii. if
any order, judgment or decree shall be entered, without the
application, approval or consent of the Company or any Significant
Subsidiary, by any court of competent jurisdiction, approving a
petition seeking liquidation or reorganization of the Company or
any Subsidiary, or appointing a receiver, trustee, custodian or
liquidator of the Company or any Subsidiary, or of all or any
substantial part of its assets, and such order, judgment or decree
shall continue unstayed and in effect for any period of sixty (60)
days;

 

xiii. the
occurrence of any levy upon or seizure or attachment of, or any
uninsured loss of or damage to, any property of the Company or any
Subsidiary having an aggregate fair value or repair cost (as the
case may be) in excess of $100,000 individually or in the
aggregate, and any such levy, seizure or attachment shall not be
set aside, bonded or discharged within thirty (30) days after the
date thereof;

 

xiv. the
Company shall fail to maintain sufficient reserved shares pursuant
to Section
4(c)(vi); or

 

xv. any monetary
judgment, writ or similar final process shall be entered or filed
against the Company, any subsidiary or any of their respective
property or other assets for more than $100,000, and such judgment,
writ or similar final process shall remain unvacated, unbonded or
unstayed for a period of 45 calendar days.

 

 

Page 14 of
18

 

 

 

b) Remedies Upon Event of Default.
Subject to the Beneficial Ownership Limitation as set forth in
Section 4(d), if
any Event of Default occurs, then the outstanding principal amount
of this Note, plus accrued but unpaid interest, liquidated damages
and other amounts owing in respect thereof through the date of
acceleration, shall become, at the Holder’s election,
immediately due and payable in cash at the Mandatory Default
Amount. After the occurrence of any Event of Default that results
in the eventual acceleration of this Note, the interest rate on
this Note shall accrue at an additional interest rate equal to the
lesser of 2% per month (24% per annum) or the maximum rate
permitted under applicable law. Upon the payment in full of the
Mandatory Default Amount, the Holder shall promptly surrender this
Note to or as directed by the Company. In connection with such
acceleration described herein, the Holder need not provide, and the
Company hereby waives, any presentment, demand, protest or other
notice of any kind, and the Holder may immediately and without
expiration of any grace period enforce any and all of its rights
and remedies hereunder and all other remedies available to it under
applicable law. Such acceleration may be rescinded and annulled by
Holder at any time prior to payment hereunder and the Holder shall
have all rights as a holder of the Note until such time, if any, as
the Holder receives full payment pursuant to this Section 6(b). No such
rescission or annulment shall affect any subsequent Event of
Default or impair any right consequent thereon.

 

Section
7.                                
Miscellaneous.

 

a) Notices. Any and all notices or
other communications or deliveries to be provided by the Holder
hereunder, including, without limitation, any Notice of Conversion,
shall be in writing and delivered personally, by facsimile, or sent
by a nationally recognized overnight courier service, addressed to
the Company, at the address set forth above, or such other
facsimile number or address as the Company may specify for such
purposes by notice to the Holder delivered in accordance with this
Section 7(a). Any
and all notices or other communications or deliveries to be
provided by the Company hereunder shall be in writing and delivered
personally, by facsimile, or sent by a nationally recognized
overnight courier service addressed to each Holder at the facsimile
number or address of the Holder as set forth in the Exchange
Agreement or as appearing on the books of the Company, or such
other facsimile number or address as the Holder may specify for
such purposes by notice to the Company delivered in accordance with
this Section 7(a).
Any notice or other communication or deliveries hereunder shall be
deemed given and effective on the earliest of (i) the date of
transmission, if such notice or communication is delivered via
facsimile at the facsimile number set forth on the signature pages
attached hereto prior to 12:00 p.m. (New York City time) on any
date, (ii) the next Trading Day after the date of transmission, if
such notice or communication is delivered via facsimile at the
facsimile number set forth on the signature pages attached hereto
on a day that is not a Trading Day or later than 12:00 p.m. (New
York City time) on any Trading Day, (iii) the second Trading Day
following the date of mailing, if sent by U.S. nationally
recognized overnight courier service or (iv) upon actual receipt by
the party to whom such notice is required to be given.

 

b) Absolute Obligation. Except as
expressly provided herein, no provision of this Note shall alter or
impair the obligation of the Company, which is absolute and
unconditional, to pay the principal of, liquidated damages and
accrued interest, as applicable, on this Note at the time, place,
and rate, and in the coin or currency, herein prescribed. This Note
is a direct debt obligation of the Company. This Note ranks
pari passu with all other Notes now
or hereafter issued under the terms set forth herein.

 

c) Lost or Mutilated Note. If this
Note shall be mutilated, lost, stolen or destroyed, the Company
shall execute and deliver, in exchange and substitution for and
upon cancellation of a mutilated Note, or in lieu of or in
substitution for a lost, stolen or destroyed Note, a new Note for
the principal amount of this Note so mutilated, lost, stolen or
destroyed, but only upon receipt of evidence of such loss, theft or
destruction of such Note, and of the ownership hereof, reasonably
satisfactory to the Company.

 

 

Page 15 of
18

 

 

d) 

 

e) Governing Law. All questions
concerning the construction, validity, enforcement and
interpretation of this Note shall be governed by and construed and
enforced in accordance with the internal laws of the State of New
York, without regard to the principles of conflict of laws thereof.
Each party agrees that all legal proceedings concerning the
interpretation, enforcement and defense of the transactions
contemplated by any of the Transaction Documents (whether brought
against a party hereto or its respective Affiliates, directors,
officers, shareholders, employees or agents) shall be commenced in
the state and federal courts sitting in the City of New York,
Borough of Manhattan (the “New York Courts”). Each party
hereto hereby irrevocably submits to the exclusive jurisdiction of
the New York Courts for the adjudication of any dispute hereunder
or in connection herewith or with any transaction contemplated
hereby or discussed herein (including with respect to the
enforcement of any of the Transaction Documents), and hereby
irrevocably waives, and agrees not to assert in any suit, action or
proceeding, any claim that it is not personally subject to the
jurisdiction of such New York Courts, or such New York Courts are
improper or inconvenient venue for such proceeding. Each party
hereby irrevocably waives personal service of process and consents
to process being served in any such suit, action or proceeding by
mailing a copy thereof via registered or certified mail or
overnight delivery (with evidence of delivery) to such party at the
address in effect for notices to it under this Note and agrees that
such service shall constitute good and sufficient service of
process and notice thereof. Nothing contained herein shall be
deemed to limit in any way any right to serve process in any other
manner permitted by applicable law. Each party hereto hereby
irrevocably waives, to the fullest extent permitted by applicable
law, any and all right to trial by jury in any legal proceeding
arising out of or relating to this Note or the transactions
contemplated hereby. If any party shall commence an action or
proceeding to enforce any provisions of this Note, then the
prevailing party in such action or proceeding shall be reimbursed
by the other party for its attorneys’ fees and other costs
and expenses incurred in the investigation, preparation and
prosecution of such action or proceeding.

 

f) Waiver. Any waiver by the
Company or the Holder of a breach of any provision of this Note
shall not operate as or be construed to be a waiver of any other
breach of such provision or of any breach of any other provision of
this Note. The failure of the Company or the Holder to insist upon
strict adherence to any term of this Note on one or more occasions
shall not be considered a waiver or deprive that party of the right
thereafter to insist upon strict adherence to that term or any
other term of this Note on any other occasion. Any waiver by the
Company or the Holder must be in writing.

 

 

 

Page 16 of
18

 

 

 

g) Severability. If any provision
of this Note is invalid, illegal or unenforceable, the balance of
this Note shall remain in effect, and if any provision is
inapplicable to any Person or circumstance, it shall nevertheless
remain applicable to all other Persons and circumstances. If it
shall be found that any interest or other amount deemed interest
due hereunder violates the applicable law governing usury, the
applicable rate of interest due hereunder shall automatically be
lowered to equal the maximum rate of interest permitted under
applicable law. The Company covenants (to the extent that it may
lawfully do so) that it shall not at any time insist upon, plead,
or in any manner whatsoever claim or take the benefit or advantage
of, any stay, extension or usury law or other law which would
prohibit or forgive the Company from paying all or any portion of
the principal of or interest on this Note as contemplated herein,
wherever enacted, now or at any time hereafter in force, or which
may affect the covenants or the performance of this Note, and the
Company (to the extent it may lawfully do so) hereby expressly
waives all benefits or advantage of any such law, and covenants
that it will not, by resort to any such law, hinder, delay or
impede the execution of any power herein granted to the Holder, but
will suffer and permit the execution of every such as though no
such law has been enacted.

 

h) Remedies, Characterizations, Other
Obligations, Breaches and Injunctive Relief. The remedies
provided in this Note shall be cumulative and in addition to all
other remedies available under this Note and any of the other
Transaction Documents at law or in equity (including a decree of
specific performance and/or other injunctive relief), and nothing
herein shall limit the Holder’s right to pursue actual and
consequential damages for any failure by the Company to comply with
the terms of this Note. The Company covenants to the Holder that
there shall be no characterization concerning this instrument other
than as expressly provided herein. Amounts set forth or provided
for herein with respect to payments, conversion and the like (and
the computation thereof) shall be the amounts to be received by the
Holder and shall not, except as expressly provided herein, be
subject to any other obligation of the Company (or the performance
thereof). The Company acknowledges that a breach by it of its
obligations hereunder will cause irreparable harm to the Holder and
that the remedy at law for any such breach may be inadequate. The
Company therefore agrees that, in the event of any such breach or
threatened breach, the Holder shall be entitled, in addition to all
other available remedies, to an injunction restraining any such
breach or any such threatened breach, without the necessity of
showing economic loss and without any bond or other security being
required. The Company shall provide all information and
documentation to the Holder that is requested by the Holder to
enable the Holder to confirm the Company’s compliance with
the terms and conditions of this Note.

 

i) Next Business Day. Whenever any
payment or other obligation hereunder shall be due on a day other
than a Business Day, such payment shall be made on the next
succeeding Business Day.

 

j) Headings. The headings
contained herein are for convenience only, do not constitute a part
of this Note and shall not be deemed to limit or affect any of the
provisions hereof.

 

*********************

 

(Signature Pages Follow)

 

 

 

Page 17 of
18

 

IN
WITNESS WHEREOF, the Company has caused this Note to be duly
executed by a duly authorized officer as of the date first above
indicated.

 

 

	
 

	

PREMIER
BIOMEDICAL INC.

 

 

	
 

	

By: 
/s/ William A. Hartman
                 
             
 

     Name:
William A. Hartman

     Title:
President

Email
for delivery of Notices:

w.hartman@premierbiomedical.com,

	
 

	

with a
copy to bal@clydesnow.com

 

	
 

	
 

 

 

Page 18 of
18

 

ANNEX A

 

NOTICE OF CONVERSION

 

 

The
undersigned hereby elects to convert principal under the 8%
Convertible Promissory Note due October 31, 2018 of Premier
Biomedical Inc. (the
“Company”), into
shares of common stock (the “Common Stock”), of the Company
according to the conditions hereof, as of the date written below.
If shares of Common Stock are to be issued in the name of a person
other than the undersigned, the undersigned will pay all transfer
taxes payable with respect thereto and is delivering herewith such
certificates and opinions as reasonably requested by the Company in
accordance therewith. No fee will be charged to the holder for any
conversion, except for such transfer taxes, if any.

 

By the
delivery of this Notice of Conversion the undersigned represents
and warrants to the Company that its ownership of the Common Stock
does not exceed the amounts specified under Section 4 of this Note, as
determined in accordance with Section 13(d) of the Exchange
Act.

 

The
undersigned agrees to comply with the prospectus delivery
requirements under the applicable securities laws in connection
with any transfer of the aforesaid shares of Common
Stock.

 

Conversion
calculations:

Date to
Effect Conversion:

 

Principal Amount of
Note to be Converted:

 

Payment
of Interest in Common Stock __ yes __ no

If yes,
$_____ of Interest Accrued on Account of Conversion at
Issue.

 

Number
of shares of Common Stock to be issued:

 

 

Signature:

 

Name:

 

Delivery
Instructions:

 

 

 

 

 

Schedule 1

 

CONVERSION SCHEDULE

 

This 8%
Convertible Promissory Note due on October 31, 2018 in the original
principal amount of $60,000 is issued by Premier Biomedical
Inc. This Conversion
Schedule reflects conversions made under Section 4 of the above
referenced Note.

 

Dated:

 

	

 

Date of
Conversion

(or for
first entry, Original Issue Date)

	

 

Amount
of Conversion

	

 

Aggregate
Principal Amount Remaining Subsequent to Conversion

(or
original Principal Amount)

	

 

Company
Attest

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