Document:

EXHIBIT
10.3

    

    FIFTH
AMENDMENT TO ASSET PURCHASE AGREEMENT

    

    THIS FIFTH AMENDMENT to Asset
Purchase Agreement is dated this 9th day of June, 2008, by and among Hunter
Bates Mining Corporation (“Hunter Bates”), a Minnesota
corporation and wholly-owned subsidiary of Wits Basin Precious Minerals Inc.
(“Wits Basin”), a
Minnesota corporation (as successor-in-interest to Wits Basin) (the “Purchaser”), Central City
Consolidated, Corp. d/b/a Central City Consolidated Mining Co., a Colorado
corporation, Hunter Gold Mining Inc., a Colorado corporation and George Otten, a
Colorado resident (collectively, the “Sellers” and each
individually, a
“Seller”), and Hunter Gold Mining Corp., a British Columbia corporation
(the “Covenantor”) (the
Purchaser, Sellers and Covenantors are individually or collectively, as the case
may be, a “Party” or
“Parties”).

     

    RECITALS: The Parties entered into
an Asset Purchase Agreement dated on or about September 20, 2006, for the sale
and purchase of assets, real estate and real estate mining claims described in
such asset purchase agreement, which was amended by that certain First Amendment
to Asset Purchase Agreement dated October 31, 2006, that Second Amendment to
Asset Purchase Agreement dated as of March 1, 2007, that Third Amendment to
Asset Purchase Agreement dated May 31, 2007 and that Fourth Amendment to Asset
Purchase Agreement dated January 14, 2008 (collectively, “Purchase Agreement”); and the
wish to amend the Purchase Agreement on the terms and conditions hereafter set
forth.  Capitalized terms used but not defined herein shall have the
meanings ascribed to them in the Purchase Agreement.

    

    AGREEMENT

     

    NOW, THEREFORE, in consideration of the
foregoing and the mutual covenants and agreements set forth below, the Parties
agree that the Purchase Agreement shall be revised as follows:

     

    1.     Section
3.2 is hereby deleted and replaced in its entirety with the following
language:

     

    Purchase Price. In
the event that Purchaser elects to proceed to closing, as and for the purchase
price of the Purchased Assets, Purchaser agrees to pay and Sellers agree to
accept the sum of Six Million Seven Hundred Fifty Thousand Canadian Dollars
($6,750,000.00 CDN) plus Three Million Six Hundred Twenty Thousand (3,620,000)
unregistered and restricted shares of the .01 par value common capital stock of
Wits Basin Precious Minerals Inc., a Minnesota corporation (“Wits Basin”), payable as set
out in Section 3.3 hereof (the “Purchase Price”).

     

    2.     Section
3.3(b)(ii) subsection (iv) is hereby deleted and replaced in its entirety with
the following language:

     

    (iv)
Three Million Six Hundred Twenty Thousand (3,620,000) shares of the unregistered
and restricted .01 par value common capital stock of Wits Basin.

     

    3.     Section
3.3(b)(iv) is hereby deleted and replaced in its entirety with the following
language:

     

    Seller
shall deliver to Purchaser a fully-executed Undertaking Agreement in the form of
Exhibit I attached
hereto and a fully-executed Shareholder Voting Agreement in the form of Exhibit J attached
hereto.

     

    
      	
              4.

            	
              Sellers
      and Covenantor agree that the operations of the limited personal liability
      provisions under the Promissory Note attached hereto as Exhibit “C” shall
      be suspended until such time as the Sellers have delivered the certificate
      of an Officer of Hunter Gold Mining Corp. confirming that the covenants
      set forth in the Undertaking Agreement have be performed by the parties
      thereto.

            

    

     

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

     

    
      	
              5.

            	
              All
      references to Exhibits E and F are hereby deleted in their
      entirety.

            

    

     

    
      	
              6.

            	
              An
      execution copy of Exhibits C, D, I and J to the Purchase Agreement are
      hereby attached to this Fifth Amendment and shall replace any previous
      versions of such Exhibits.

            

    

     

    
      	
              7.

            	
              All
      references to “Central City Consolidated Mining Corp.” or “Central City
      Consolidated Mining Co.” or “Central City Mining Corp.” are hereby deleted
      in their entirety and replaced with “Central City Consolidated,
      Corp.”

            

    

     

    
      	
              8.

            	
              The
      first paragraph of the Purchase Agreement is hereby deleted and replaced
      in its entirety with the following
language:

            

    

     

    THIS
ASSET PURCHASE AGREEMENT (this “Agreement”) is made and
entered into as of this 20th day of September, 2006, by and among Wits Basin
Precious Minerals Inc., a corporation organized under the laws of the State of
Minnesota (the “Purchaser”), Central City
Consolidated Corp. d/b/a Central City Consolidated Mining Co., a corporation
organized under the laws of the State of Colorado, Hunter Gold Mining Inc., a
corporation organized under the laws of the state of Colorado and George Otten,
a resident of Colorado, (collectively, the “Sellers” and each individually
as a “Seller”), and
Hunter Gold Mining Corp., a corporation organized under the laws of the Province
of British Columbia, (the “Covenantor”).

    

    
      	
              9.

            	
              The
      Parties acknowledge that Hunter Gold Mining Inc., a Colorado corporation,
      shall hereby be included in the definition of “Sellers” and excluded
      from the definition of “Covenantors.”  All
      references to the term “Covenantors” shall include only Hunter Gold Mining
      Corp., a British Columbia corporation.  All references to the
      plural term “Covenantors” shall be deemed singular, mutatis
      mutandis.

            

    

     

    
      	
              10. 

            	
              Section
      4.1.1 is hereby deleted in its entirety and replaced with the following
      language:

            

    

     

    “Central
City Consolidated Corp. and Hunter Gold Mining Inc. are corporations duly
incorporated, validly existing and in good standing under the laws of their
respective jurisdictions of incorporation.  Central City Consolidated
Corp. and Hunter Gold Mining Inc. have the requisite power to own, operate, use
and/or lease the Purchased Assets, as applicable, and to conduct the operations
of the Purchased Assets as presently being conducted by them and/or by the
Covenantor, including any and all permits required by any public authority for
such operations such as permits, or regulatory authorizations.”

     

    11.     Section
5.7 is hereby deleted in its entirety and replaced with the following
language:

     

    “Shares Duly and Validly
Issued.  The 3,620,000 shares of .01 par value common capital
stock of Wits Basin constituting a portion of the Purchase Price shall have been
duly and validly issued as fully paid and non-assessable, and in accordance with
all applicable securities laws, as of the Closing Date.”

     

    
      	
              12.

            	
              Any
      notice or other documents given pursuant to the Purchase Agreement to
      Hunter Gold Mining Inc., as Seller, shall be sent to:  Hunter
      Gold Mining Corp., P.O. Box 2460, Station “R”, Kelowna, British Columbia,
      Canada V1X 6A5, Attention: Dell Balfour, Facsimile: (250) 765-4420, with a
      copy to:  Pushor Mitchell LLP, 3rd Floor, 1665 Ellis Street,
      Kelowna, British Columbia, Canada V1W 4T7, Attention: E. Blair Forrest,
      Facsimile: (250) 762-9115.

            

    

     

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

     

    
      	
              13.

            	
              Section
      8.10 of the Purchase Agreement is deleted in its entirety and replaced
      with the following:

            

    

     

    “Purchaser
reserves the right hereunder to assign its right(s) to one or more affiliated
parties prior to closing, it being understood that Purchaser may create one or
more new entities which may consummate the Contemplated
Transactions.  In the event that the Purchaser assigns it right(s)
hereunder any such affiliated party or parties, then (i) Purchaser shall also
make, or shall cause such assignee(s) to make, in respect of such assignee(s),
the representations and warranties set forth in sections 5.1 to 5.6 (inclusive)
of the Purchase Agreement, (ii) Purchaser shall cause such assignee(s) to agree
to be bound by all of the Purchaser’s covenants and obligations under the
Purchase Agreement except for those which, by their nature, are intended to be
performed solely by the Purchaser notwithstanding any assignment of the
Purchaser’s rights under the Purchase Agreement, (iii) both the Purchaser and
each such assignee shall deliver a certificate of an officer thereof for the
purposes of section 9.1 of the Purchase Agreement, and (iv) the opinions set
forth in the Purchaser Counsel’s Legal Opinion (as defined in section 9.4
hereof) shall extend, to the extent applicable, to both the Purchaser and its
assignee(s).”

     

    
      	
              14.

            	
              To
      each of the Sellers and the Covenantor, Hunter Bates hereby makes the
      representations and warranties set forth in sections 5.1 to 5.6
      (inclusive) of the Purchase Agreement as though the term “Purchaser” set
      forth therein refers to Hunter Bates and with the exception that the
      representation set forth in section 5.5 of the Purchase Agreement shall be
      deemed to include the words “Except for the consent of “Wits Basin,” at
      the beginning of such section.  Hunter Bates further agrees to
      be bound by all of the covenants and obligations of the Purchaser except
      for those covenants and obligations which, by their nature, are intended
      to be performed by Wits Basin notwithstanding the assignment of Wits
      Basin’s rights under the Purchase Agreement to Hunter
    Bates.

            

    

     

    
      	
              15.

            	
              Wits
      Basin hereby confirms that it has consented to the consummation by Hunter
      Bates of the “Contemplated Transactions” (as defined in the Purchase
      Agreement) and to its execution of any documents incidental
      thereto.

            

    

     

    
      	
              16.

            	
              The
      parties hereto agree that in the event the tax advisors to Hunter Gold
      Mining Inc. and Hunter Gold Mining Corp. identify and recommend an
      alternate structure for the delivery of the Purchase Price including, but
      not limited to, the distribution and documentation of the Purchase Price
      in the name of one or more alternate parties, and/or recommend an
      alteration to the content of the Allocation Schedule, then each of the
      parties hereto agrees to take all reasonable steps to record and effect
      the necessary changes to the Purchase Agreement and the documents
      ancillary thereto to implement such recommendation; provided, however,
      that Sellers and Covenantor shall reimburse Purchaser for all reasonable
      expenses incurred in the course of effecting such
      change.  Notwithstanding the foregoing, Purchaser shall not be
      obligated to participate in effecting the aforementioned changes if, in
      the reasonable opinion of legal counsel to the Purchaser, there is a
      reasonable risk of adverse tax, accounting or securities law consequences
      to the Purchaser in connection with the implementation of such
      changes.  The parties further agree that any references to a
      deemed value for the 3,620,000 shares of common capital stock of Wits
      Basin, which comprise a portion of the Purchase Price under the Purchase
      Agreement, contained in the Purchase Agreement or in any of the
      transaction documents ancillary to the Purchase Agreement shall not be
      binding on the parties thereto in conjunction with any valuation of the
      Purchase Price for taxation purposes and the Sellers and Covenantor shall
      be at liberty to employ any reasonable method of valuation that is
      recommended by the tax advisors to Hunter Gold Mining Inc. and Hunter Gold
      Mining Corp.

            

    

     

    
      	
              17.

            	
              Clause
      12.4(e) of the Purchase Agreement is hereby added with the following
      language:

            

    

     

    “(e)    any
costs not otherwise falling within the scope of subsections 12.4(a) - (e),
inclusive, which are reasonably incurred by or on behalf of the Beneficiary (as
defined in the Deed of Trust), following enforcement by the Beneficiary of its
remedies under the Deed of Trust, in effecting the remediation and/or
rehabilitation of the Acquired Real Property in respect of any activities of the
Purchaser (or its related party successors) thereon where such activities (i)
contravene any Environmental Law (regardless of whether such contravention is
enforced against the Purchaser or its successors) and (ii) take place after
January 15, 2005 and prior to the earlier of (a) time of repossession of the
Acquired Real Property by the Beneficiary or (b) transfer of the Acquired Real
Property to a third party unrelated to the Purchaser; provided, however, that
the maximum amount of the Purchaser's liability under this subsection 12.4(e)
shall be $4,750,000 CDN.”

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

     

    
      	
              18.

            	
              The
      Allocation Schedule set forth in Section 3.8 is hereby deleted in its
      entirety and replaced with the allocation schedule attached hereto as
      Exhibit
      K.

            

    

     

    
      	
              19.

            	
              The
      Parties agree that the following amounts, when advanced by the Purchasers
      on behalf of the Sellers and/or the Covenantors, shall be credited against
      the amount due under the Promissory Note attached hereto and to the
      Purchase Agreement as Exhibit “C”, and Sellers shall deliver a receipt to
      the Purchasers upon payment by the Purchasers of such
    amounts:

            

    

     

    
      	
            	
              (i)

            	
              $15,000.00
      to Pushor Mitchell LLP in respect of past legal fees of the Covenantor
      (paid),

            

    

     

    
      	
            	
              (ii)

            	
              $5,000.00
      to Dill Dill Carr Stonbraker and Hutchings, PC in respect of the closing
      legal costs of Hunter Gold Mining Inc.
(paid),

            

    

     

    
      	
            	
              (iii)

            	
              $7,500.00
      to Pushor Mitchell LLP for the closing legal costs of the Covenantor
      (pending),

            

    

     

    
      	
            	
              (iv)

            	
              $3,467.16
      to First American Heritage Title Company for the Sellers’ closing costs as
      per the Sellers Closing Statement
(pending),

            

    

     

    
      	
            	
              (v)

            	
              $1,376.60
      for the Sellers’ 2008 personal property taxes
  (pending)

            

    

     

    for a
total of $32,343.76.

     

    
      	
              20.

            	
              At
      the end of the first sentence of Article 2 of the Purchase Agreement, the
      words “(Assumed
      Liabilities”)” is hereby
added.

            

    

     

    
      	
              21.

            	
              All
      references to “Purchaser Losses” in Sections 6.4(d) and (e) of the
      Purchase Agreement are hereby replaced with “Purchaser Environmental
      Losses.”

            

    

     

    
      	
              22.

            	
              The
      term “Purchaser Losses” in Section 12.1 of the Purchase Agreement is
      hereby replaced with the following
language:

            

    

     

    “loss,
liability, expense (including without limitation reasonable expenses of
investigation and reasonable attorneys’ fees and expenses in connection with any
action, suit or proceeding brought against the Purchaser (or its related party
successors)) or Damages suffered or incurred by the Purchaser (or its related
party successors) (the “Purchaser
Losses”)”

     

    
      	
              23.

            	
              Except
      as provided for above, all the terms and conditions of the Purchase
      Agreement shall remain in full force and effect.  This Fifth
      Amendment may be executed in counterparts.  A facsimile
      signature shall be deemed an
original.

            

    

     

    Signature
Page Follows

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

     

    IN
WITNESS WHEREOF, the parties hereto have caused this Fifth Amendment to be duly
executed and delivered, all on and as of the date first written
above.

     

    
      
        
          
            	
                    HUNTER
      BATES MINING 

                    CORPORATION

                    a
      Minnesota corporation

                  	 	 
      
	 
      	 
      	 	 
      
	
                    By:

                  	
                    /s/  Mark D.
Dacko

                  	 	 
      
	
                    Its: 

                  	
                    CFO

                  	 	 
      
	 
      	 
      	 	 
      
	
                    CENTRAL
      CITY CONSOLIDATED, 

                    CORP.

                    a
      Colorado corporation

                  	 	
                    GEORGE
      OTTEN, a resident of Colorado

                  
	 
      	 
      	 	 
      
	
                    By:

                  	
                    /s/ George E. Otten

                  	 	
                    /s/ George E.
      Otten                                                                

                  
	
                    Its:

                  	
                    President

                  	 	 
      
	 
      	 
      	 	 
      
	
                    HUNTER
      GOLD MINING CORP.

                    a
      British Columbia corporation

                  	 	
                    HUNTER
      GOLD MINING INC.

                    a
      Colorado corporation

                  
	 
      	 
      	 	 
      	 
      
	
                    By:

                  	
                    /s/ George E. Otten

                  	 	
                    By:

                  	
                    /s/ George E. Otten

                  
	
                    Its:

                  	
                    President

                  	 	
                    Its: 

                  	
                    President

                  
	 
      	 
      	 	
                    591242v9

                  

          

        

      

    

    

    The
foregoing is consented to by and joined solely with respect to Section 5.7 of
the Purchase Agreement, as amended by this Fifth Amendment:

     

    WITS
BASIN PRECIOUS MINERALS INC.

    a
Minnesota corporation

     

    
      
        
          
            
              	
                      By:

                    	
                      /s/  Mark D.
Dacko

                    	 
	
                      Its: 

                    	
                      CFO

                    	 

            

          

        

      

    

     

    
      Signature
Page to Fifth Amendment to Asset Purchase Agreement

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    EXHIBIT
C

    

    PROMISSORY
NOTE

    

    LIMITED
RECOURSE PROMISSORY NOTE

    

    
      	
              CDN
      $6,750,000.00

            	
              Minneapolis,
      Minnesota, USA

            
	 
      	
              June
      6, 2008

            

    

    

    1.           FOR
VALUE RECEIVED, the undersigned, HUNTER BATES MINING
CORPORATION, a Minnesota corporation (hereinafter “Borrower”) whose
address is 900 IDS Center, 80 South 8th Street,
Minneapolis MN 55402-8773, promises to pay to the order of GEORGE E. OTTEN,
(“Holder”), a
Colorado resident whose address is 11438 Weld County Rd 19, Fort Lupton, CO
80621 (or his nominee or assignee) the principal sum of Six Million Seven
Hundred Fifty Thousand and 00/100 Canadian Dollars (CDN $6,750,000.00), in
lawful money of Canada, together with interest on the unpaid principal balance,
at the interest rate as set forth below, in installments as
follows:

    

    (i)           On
or before December 1, 2008, the sum of $250,000;

    

    (ii)          Commencing
on April 1, 2010, and continuing on each January 1, April 1, July 1, and October
1 thereafter (each, a “Payment Date”) until the Maturity Date (as defined
below), the Borrower shall pay a quarterly installment of accrued interest only
plus a Production Revenue Payment (as defined below), calculated at the interest
rate as set forth below.

    

    (iii)         On
the earlier of (i) fifth anniversary of the first Production Revenue Payment or
(ii) December 31, 2015 (such earlier date is referred to herein as the “Maturity
Date”), the entire remaining principal balance together with any unpaid accrued
interest shall be due and payable.

    

    2.           From
the date hereof until December 31, 2009, no interest shall accrue on the unpaid
balance hereunder.  From January 1, 2010 until this Note is paid in
full, interest shall accrue on the unpaid balance hereunder at the rate of six
percent (6.00%) per annum; provided, however, that in the event of a default
hereunder, the unpaid balance shall accrue interest at the rate of eight (8%)
(the “Default Rate”) during the period of such default.

    

    3.           In
addition to the interest payments due above, Borrower agrees that, on the first
Payment Date following the first Calendar Quarter (which is defined as any (i)
January 1 to March 31, (ii) April 1 to June 30, (iii) July 1 to September 30, or
(iv) October 1 to December 31, of any year) in which Borrower realizes Profit
(as defined below) in excess of US$100,000 in such Calendar Quarter from the
real estate commonly known as the “Hunter Gold Mine”, located in the Gilpin
County, Colorado, USA (the “Mine”), which was acquired by Borrower in part from
Hunter Gold Mining Inc. (“HGM Inc.”), in part from Central City Consolidated
Corp. (“Central City”) and in part from George Otten (“Otten”) on the date of
this Note, and continuing on each Payment Date thereafter until this Note is
repaid in full, Borrower shall make principal repayments hereunder (each a
“Production Revenue Payment”), which payment(s) shall equal:

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    
      	
               
      

            	
              (i)

            	
              For
      all Calendar Quarters ending on or prior to December 31, 2012,
      seventy-five per cent (75%) of the Profit realized by the Borrower for the
      immediately preceding Calendar Quarter,
and

            

    

    
      	
               
      

            	
              (ii)

            	
              For
      Calendar Quarters ending after December 31, 2012, the greater of (a)
      Seventy-five per cent (75%) of the Profit realized by the Borrower for the
      relevant Calendar Quarter and (b) CDN
  $300,000.00.

            

    

    

    Notwithstanding
the foregoing, if the Borrower has not been obligated to make a Production
Revenue Payment by December 31, 2012, then beginning on April 1, 2013 and
continuing on each Payment Date until the Borrower has become obligated to make
a Production Revenue Payment, the Borrower shall make principal repayments
hereunder in the amount of CDN $550,000.  Upon the Borrower becoming
obligated to make a Production Revenue Payment at anytime after April 1, 2013,
the Borrower shall thereafter make Production Revenue Payments in accordance
with the foregoing subsection 3(ii).

    

    For the
purposes of the foregoing, “Profit” shall be defined as any positive number
comprising all revenue received by Borrower from sales of minerals or mineral
by-products from the Mine, less all Borrower’s expenses, including interest
expense but excluding depreciation, distributions or dividends paid to
shareholders of Borrower, incurred in connection with such sales or the
operation of the Mine for the immediately preceding Calendar
Quarter.

    

    4.           Notwithstanding
anything contained in this Note to the contrary, the Holder may demand payment
in full and declare the outstanding balance due hereunder immediately due and
payable in the event that (i) there has been a change of control of the Borrower
by virtue of any party (other than the “Covenantor”, as defined below) acquiring
more than 50% of the issued and outstanding shares of any class of the Borrower,
or (ii) if the Borrower disposes of its interests in the Mine. .

    

    5.           All
payments hereunder shall be made by way of guaranteed or immediately available
funds delivered to the offices of Pushor Mitchell LLP, 3rd Floor,
1665 Ellis Street, Kelowna, British Columbia, Canada, V1W 4T7,
Attention:  E. Blair Forrest.  The parties hereto
specifically agree that any payments made to or for the benefit of Holder, HGM
Inc., Hunter Gold Mining Corp. (“HGM Corp.”), a British Columbia corporation, or
Central City by Borrower or Covenantor, shall be deemed to be payments made
hereunder and credited against sums next due and owing hereunder, provided that,
(i) prior to making such payment(s), Borrower shall have received written
approval from Pushor Mitchell, LLP (as escrow agent in respect of this Note, or
their successor) that such payments shall be for the account of Holder hereunder
and (ii) payments referenced in Section 19 of the Fifth Amendment to Asset
Purchase Agreement, dated of even date herewith, by and among the foregoing
parties, are deemed to be payments made hereunder.  The Holder shall
promptly provide the Borrower with a written receipt for all payments received
from the Borrower and/or the Covenantor in respect of the sums due
hereunder.

    

    
      
        
           

        

        
          2

          
            

          

        

        
           

        

      

    

    

    6.           It
is hereby expressly agreed that should default be made in the payment of any
installment of principal, interest or other sums when due hereunder, and such
default continues for forty-five (45) days after the date due, an “Event of
Default” shall occur under the Deed of Trust and Security Agreement (“Deed of
Trust”) of even date herewith securing this Note and covering property located
in Gilpin County, Colorado, the whole sum of principal, accrued interest and
other sums outstanding hereunder shall, at the option of the Holder hereof, be
fully accelerated and become immediately due and payable, anything contained
herein or in any instrument now or hereafter securing this Note to the contrary
notwithstanding.  Said acceleration option and Default Rate shall
continue until all such defaults have been cured.  In the event of
such acceleration, the term “Maturity Date” shall be deemed to mean the date on
which this Note is due and payable as a result of such
acceleration.

    

    6.1           Notwithstanding
any other provision of this Note, if an “Event of Default” shall occur under the
Deed of Trust, the Borrower and Wits Basin Precious Minerals Inc., a Minnesota
corporation (hereinafter the “Covenantor”), whose address is 900 IDS Center, 80
South 8th Street,
Minneapolis MN 55402-8773, shall be jointly and severally personally liable
solely for the amount (the “Limited Recourse Amount”) of CDN $2,000,000 less the
aggregate of (i) all payments of principal and interest hereunder received by or
on behalf of the Holder, (ii) any cash proceeds (the “Cash Proceeds”) received
by or on behalf of the Holder from the cash sale, prior to such default, of any
of the 3,620,000 shares of the .01 par value common stock of Wits Basin Precious
Minerals Inc. which represents part of the purchase price for the Mine (the
“Stock Consideration”), and (iii) any deemed proceeds (the “Deemed Proceeds”)
resulting from the in specie disposition of the Stock Compensation by the Holder
to any of Otten, Central City, HGM Inc., Hunter Gold Mining Corp. and/or the
shareholders of any of them (a “Transferee”).  For the purposes of the
foregoing, the “Deemed Proceeds” shall be calculated on the basis of CDN $0.5525
per share disposed of by the Holder and the “Cash Proceeds” shall be deemed to
be the greater of CDN $0.5525 per share disposed of and the actual proceeds per
share disposed of by the Holder (expressed in Canadian dollars).  The
Holder’s sole recourse for any amounts due on default hereunder in excess of the
Limited Recourse Amount shall be the secured property described in the Deed of
Trust.  For greater certainty, the cash proceeds received by any
Transferee in respect of a subsequent sale of any transferred shares shall not
be included in the foregoing Limited Recourse Amount calculations.  If
an “Event of Default” shall occur under the Deed of Trust, any remaining shares
comprising the Stock Consideration that are sold by or on behalf of the Holder
after the time of such “Event of Default” shall be deemed to have been sold for
Cash Proceeds calculated in the foregoing manner unless the Holder has complied
with the right of first refusal provisions set forth in paragraph 10 below, in
which case the provisions of paragraph 10 shall apply.

    

    6.2           Notwithstanding
the provisions of Section 6.1 above, the parties hereto agree that the recourse
provisions of Section 6.1 shall not apply until and unless the obligations and
deliveries required by that certain Undertaking Agreement of even date herewith,
by and among HGM Corp., the Holder, Dell Balfour, Douglas McNaughton, the
Covenantor and the Borrower have been fully satisfied, as evidenced by the
certificate of an officer of HGM Corp. to that effect and delivered to the
Borrower and the Covenantor.

    

    
      
        
           

        

        
          3

          
            

          

        

        
           

        

      

    

    

    7.           Notwithstanding
any other provision of this Note to the contrary, it is agreed that, for a
period of four (4) years commencing on the date of this Note, Borrower reserves
the right to conduct mineral title research on the Hunter Gold Mine after the
Borrower has entered the advanced exploration project phase (drill intercepts
showing an economically viable mine) in the Hunter Gold Mine.  If the
results of such mineral title research do not show that good and marketable
title to the Hunter Gold Mine was properly transferred to the Borrower, Borrower
may offset against the principal amount and any accrued interest thereon of this
Note any and all costs deemed appropriate by Borrower, acting reasonably, to
settle adverse claims in, or to acquire arm’s length third-party interests in
relation to, the Hunter Gold Mine.  In the event that the Borrower’s
mineral title research discloses such an arm’s length third-party adverse claim
and the Borrower proposes to settle such claim, the Borrower shall first advise
and confer with the Holder and the Trustee under the Trust Deed and shall permit
the Holder and the Trustee to participate in the settlement negotiations
regarding such adverse claims.

    

    8.           Borrower
may prepay a portion or the entire principal amount due hereunder at any time
without penalty, and such prepayment shall be applied as hereinabove
provided.

    

    9.           Borrower
consents to the personal jurisdiction of the state and federal courts located in
the State of Colorado in connection with any controversy related in any way to
this Note or any security or guaranty for this Note, waives any argument that
venue in such forums is not convenient, and agrees that any litigation initiated
by any of them against the Holder or any other holder of this Note relating in
any way to this Note or any security or guaranty for this Note shall be venued
in either the District Court of Gilpin County, Colorado, or the United States
District Court for the District of Colorado.

    

    10.          In
the event of a default under this Note, the Holder agrees that no further shares
comprising the Stock Consideration shall be sold by or on behalf of the Holder
unless the Holder has first offered such shares to the Covenantor (or its
nominee), which offer (the “Offer”) shall be delivered in writing to the
Covenantor in the manner set forth in paragraph 12 (below) and shall state the
number of shares offered, the price per share offered and the deadline for
acceptance of the Offer, which deadline shall not be less than 48 hours from the
time of delivery of the Offer.  The Offer may be accepted by the
Covenantor, in whole or in part, at any time prior to the deadline for
acceptance of the Offer by delivering a written notice of acceptance to the
Holder in the manner set forth in paragraph 12 (below).  If the Offer
is accepted by the Covenantor, in whole or in part, the Covenantor shall deliver
the purchase price to the Holder (or its nominee) by certified check, bank draft
or wire transfer with 3 business days thereafter and the Limited Recourse Amount
shall be reduced by the actual amount of such purchase price, whether such
purchase price is greater or less than CDN $0.5525 per share.  To the
extent that the Offer is not accepted by the Covenantor, the Holder shall be at
liberty to sell all of any of the shares offered but not purchased by the
Covenantor to any arm’s length purchaser(s) and the Limited Recourse Amount
shall be reduced by the actual amount of the cash proceeds of such sale(s)
received by the Holder, whether such cash proceeds are greater or less than CDN
$0.5525 per share.

    

    11.          For
the purposes of paragraphs 6 and 10 of this Note, the Holder agrees to provide
the Covenantor with written confirmation of any sales or distributions of the
shares comprising the Stock Consideration, other than sales to the Covenantor
under paragraph 10 (above).

    

    
      
        
           

        

        
          4

          
            

          

        

        
           

        

      

    

    

    12.           All
payments pursuant to this Note which are made or remitted in currency of the
United States shall be deemed to have been made in Canadian currency at a rate
equal to 1.5% below the  reported Daily 12 Noon Foreign Exchange Rate
of the Federal Reserve Bank of New York on the date such payment is made or
remitted.

    

    13.           Any
notices to be delivered under paragraph 10 (above) shall be delivered by
facsimile transmission as follows:

    

    
      
        	
                 If
      to the Borrower and/or the Covenantor:

              
	 
      
	
                Care
      of Wits Basin Precious Minerals Inc.

              
	
                Attention:  Chief
      Executive Officer

              
	
                Facsimile:  (612)
      395-5276

              
	 
      
	
                 With
      a copy to:

              
	
                Maslon
      Edelman Borman & Brand LLP

              
	
                Attention:  William
      Mower, Esq.

              
	
                Facsimile:  (612)
      642-8358

              
	 
      
	
                 If
      to the Holder:

              
	
                George
      E. Otten

              
	
                Facsimile:
      (970) 785-6248

              
	 
      
	
                 With
      a copy to:

              
	
                Hunter
      Gold Mining Corp.

              
	
                Attention:  Dell
      Balfour

              
	
                Facsimile:  (250)
      765-4420

              
	 
      
	
                 And
      a copy to:

              
	
                Pushor
      Mitchell LLP

              
	
                Attention:
      E. Blair Forrest

              
	
                Facsimile:  (250)
      762-9115

              

      

    

     

    
      
        
           

        

        
          5

          
            

          

        

        
           

        

      

    

    

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                	
                                        BORROWER:

                                      
	 
      
	
                                        Hunter
      Bates Mining Corporation

                                      
	 
	 
      
	
                                        Name:

                                      	 
      
	
                                        Title:

                                      	 
      
	 
      
	
                                        COVENANTOR:

                                      
	 
      
	
                                        Wits
      Basin Precious Minerals Inc.

                                      
	 
	 
      
	
                                        Name:

                                      	 
      
	
                                        Title:

                                      	 
      
	 
      
	
                                        HOLDER:

                                      
	 
      
	 
      
	
                                        George
      E.
Otten

                                      

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

    

    Signature
Page – Promissory Note

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    EXHIBIT
D

    

    DEED
OF TRUST AND EXHIBIT A TO DEED OF TRUST

    

    DEED
OF TRUST AND SECURITY AGREEMENT

    

    THIS DEED OF TRUST AND SECURITY
AGREEMENT (“Deed of Trust”) is made as of the 6th day of June, 2008,
between HUNTER BATES MINING CORPORATION, a Minnesota corporation (“Grantor”),
having an office at 900 IDS Center, 80 South 8th Street,
Minneapolis MN 55402-8773, and the Gilpin County Public Trustee (“Trustee”),
whose address is 203 Eureka Street, P.O. Box 368, Central City, CO,
80427.

    

    WITNESSETH:

    

    WHEREAS, this Deed of Trust is
made by Grantor to secure and enforce the payment of the following note,
obligations, indebtedness and liabilities:  (a) a certain Promissory
Note of even date herewith in the principal amount of Six Million Seven Hundred
Fifty Thousand and 00/100 Canadian Dollars (CND $6,750,000.00) made by Grantor
and payable to the order of George E. Otten, a Colorado resident whose address
is 11438 Weld County Rd, Fort Lupton, CO, 80621 (or his nominee or assignee),
with interest and payments, all as provided therein, being due and payable in
full on December 31, 2015 (or earlier as provided for therein), and all
modifications, renewals or extensions thereof (the “Note”) (said payee and all
subsequent holders of the Note or any part thereof or any interest therein or in
any of the Secured Indebtedness, as hereinafter defined, are hereinafter
collectively called the “Beneficiary”); and (b) all obligations of this Deed of
Trust or any other instruments (“Loan Documents”) executed by Grantor in favor
of Beneficiary now or hereafter evidencing or securing the above-described
indebtedness or any part thereof (collectively the “Secured
Indebtedness”).  The terms and provisions of the Note are incorporated
herein by this reference.

    

    In order to secure payment of the
Secured Indebtedness, Grantor does hereby grant, bargain, sell and convey unto
the Trustee, in trust forever, that certain property situate in the Gilpin
County, Colorado, more particularly described on Exhibit A attached hereto and
incorporated herein by this reference, which is commonly known as the Hunter
Gold Mine (sometimes collectively hereinafter referred to as the “Property” or
the “Mortgaged Property”); and

    

    TOGETHER with all and singular
the tenements, hereditaments, easements, rights of way and appurtenances
thereunto belonging or in any wise appertaining, whether now owned or hereafter
acquired by Grantor, and any and all rights of ingress and egress to and from
adjoining property (whether such rights now exist or subsequently arise),
together with the reversion or reversions, remainder or remainders, and rents,
issues and profits thereof, and also the entire estate, right, title, interest,
claim and demand whatsoever of Grantor of, in and to the same and of, in and to
every part and parcel thereof; and

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    TOGETHER with all buildings,
structures, parking structures and improvements now or hereafter located on the
Mortgaged Property, including any and all easements and rights of way used in
connection therewith; and

    

    TOGETHER with all right, title
and interest of Grantor, if any, in all trees, shrubs, flowers and other
landscaping features and all oil, gas, minerals, water, water rights, drains and
drainage rights appurtenant to, located on, under or above or used in connection
with the Mortgaged Property and the improvements situate thereon, or any part
thereof, whether now existing or hereafter created or acquired; and

    

    TOGETHER with all leases,
rents, issues, royalties, bonus, income and profits, of each and every kind, now
or hereafter relating to or arising from the Mortgaged Property and the
improvements situate thereon; and

    

    All of the foregoing property,
interests and rights are sometimes hereinafter collectively referred to as the
"Mortgaged Property, Improvements and Rights, or the “Property”;

    

    AND, Grantor, for itself and
its successors and assigns, represents, warrants and covenants that, and has
good right and authority to grant, bargain, sell, convey, transfer, assign and
mortgage the Property; that the execution and delivery of this Deed of Trust,
the Note and all other instruments securing the payment of the Note do not
contravene any law, order, decree, rule or regulation to which Grantor is
subject; that the Note, this Deed of Trust and all other instruments securing
the payment of the Note constitute the legal, valid and binding obligations of
Grantor and that Grantor will warrant and forever defend the title to the
Property against the claims of all persons whomsoever claiming or to claim the
same or any part thereof, subject to all matters of record.

    

    AND, that for so long as the
Secured Indebtedness or any part thereof remains unpaid, Grantor covenants and
agrees for itself and its successors and assigns as follows:

    

    1.           Covenants.

    

    1.1         General
Covenants.

    

    1.1.1       Payment.  Grantor
will make prompt payment, as the same become due, of all installments of
principal and interest on the Note and of all the other Secured
Indebtedness.

    

    1.1.2       Maintenance
of Mortgaged Property.  Grantor will cause the Mortgaged
Property to be used, occupied and operated in accordance with all applicable
laws and rules, regulations and orders promulgated by all duly constituted
authorities.  Grantor will allow the Beneficiary and/or its authorized
representatives to enter the Property at any reasonable time upon advance
written notice to inspect the Property and Grantor's books and records
pertaining thereto, and Grantor will reasonably assist the Beneficiary and said
representatives in whatever way necessary to make such inspection.

    

    
      
        
           

        

        
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    1.1.3       Taxes.  Grantor
shall pay or cause to be paid prior to delinquency, except to the extent
provision is actually made therefor as set forth hereinafter, all taxes and
assessments theretofore or hereafter levied or assessed against the Property, or
any part thereof, or any other tax asserted as a substitute therefor and upon
request, will furnish the Beneficiary with receipts showing payment of such
taxes and assessments on or before the applicable due date therefor; except that
Grantor may in good faith, by appropriate proceedings, contest and diligently
pursue such contest, the validity, applicability or amount of any asserted tax
or assessment; provided, however, that in any event each such contest shall be
concluded and the taxes, assessments, interests, costs and penalties shall be
paid prior to the date any writ or order is issued under which the Property may
be sold.

    

    1.1.4       Condemnation.  Immediately
upon obtaining knowledge of the institution of any proceedings for the
condemnation of the Property or any portion thereof, or any other proceedings
arising out of injury or damage to the Property, or any portion thereof, Grantor
will notify the Beneficiary of the pendency of such proceedings and the time and
place of all settings, hearings, trials or other proceedings relating
thereto.  The Beneficiary may participate in any such proceedings, and
Grantor shall from time to time deliver to the Beneficiary all instruments
required by it to permit such participation.  Grantor shall, at its
expense, diligently prosecute any such proceedings.  All proceeds of
condemnation awards or proceeds of sale in lieu of condemnation with respect to
the Property and all judgments, decrees and awards for injury or damage to the
Property shall be paid to the Grantor and shall be applied to the repair,
restoration or replacement of the property condemned. In the event the proceeds
of the condemnation award (after deduction for reimbursements to the Beneficiary
and Trustee) are deemed inadequate, in the sole discretion of a licensed
engineer or architect hired by Grantor, to repair or restore any injury or
damage arising from such condemnation, Grantor shall pay said amount necessary
for such repair, restoration or replacement.  Determination by
Grantor's licensed engineer or architect, acting reasonably, of the amount
required to be contributed by the Grantor shall be deemed
conclusive.  If (i) there exists an event of default under the Note,
this Deed of Trust, or the Loan Documents, the condemnation proceeds shall be
applied by the Beneficiary to cure such default and the remainder shall be paid
to Grantor for the restoration or repair of the Property, or (ii) Grantor and
the Beneficiary mutually agree, in which case the condemnation proceeds shall be
applied in payment of the Secured Indebtedness, either in whole or in part
(without a premium or penalty), in the inverse order of maturity, with the
remainder, if any, to be paid to Grantor.  The Beneficiary shall send
to Grantor a notice of the balance of the Secured Indebtedness remaining, if
any, after the application of said funds.  Grantor shall not be
obligated to repair or rebuild the damaged portion of the Property.

    

    1.1.5       Books and
Records.  Grantor will keep accurate books and records in
accordance with generally accepted accounting principles in which full, true and
correct entries shall be promptly made as to all operations on the Property,
and, as often as reasonably requested by the Beneficiary, but nor more often
than once in each calendar quarter, Grantor will make reports of operations in
such form as the Beneficiary prescribes, setting out full data as to the
exploration activities and expenditures, mine development activities and
expenditures, mining activities and expenditures and all revenues from the
Property.

    

    
      
        
           

        

        
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    2.           Remedies
and Events of Default.

    

    2.1          Events of
Default.  The term "default" or "event of default" as used in
this Deed of Trust shall mean the occurrence of any of the following
events:

    

    (a)           The
failure of Grantor to make any installment of principal or interest due under
the Note within forty-five (45) days from the date such payment is
due;

    

    (b)           The
failure of Grantor to make any payment except for a payment described in
paragraph (a) hereof, within forty-five (45) days of the Trustee’s and/or the
Beneficiary's notice of such failure; or

    

    (c)           The
failure of Grantor to timely and properly observe, keep or perform any material
nonmonetary covenant, agreement, warranty or condition herein or of any Loan
Documents required to be observed, kept or performed, except that Grantor shall
have one hundred and twenty (120) days from notice of such failure to cure such
default and if such default cannot be cured within one hundred and twenty (120)
days, Grantor shall have a reasonable period of time within which to cure such
default, provided Grantor promptly commences curative action and prosecutes such
curative action diligently to completion and provided such default or failure
can be and is cured within six months from the date of such notice.

    

    2.2           Acceleration.  Upon
the occurrence of a default, which is not cured during the applicable cure
period, if any, the Beneficiary shall have the option of declaring all the
Secured Indebtedness in its entirety to be immediately due and payable without
notice to Grantor, and the liens and security interests evidenced hereby shall
be subject to foreclosure in any manner provided for herein and as provided by
law.

    

    2.3           Management
and Possession.  Upon the occurrence of a default which is not
cured during the applicable cure period, if any, the Beneficiary is authorized,
whether prior or subsequent to the institution of any foreclosure proceedings,
to enter upon the Property, or any part thereof, and to take possession of the
Property and to exercise, without interference from Grantor, any and all rights
to construct, manage, possess, operate, protect or preserve the Property and all
equipment, data, documents, records, samples, minerals, ore and other materials
relating to and/or derived from the Property (the “Associated Materials”), and
to deduct from the proceeds (if any) resulting from the exercise of such rights
all reasonable costs, expenses and liabilities of every character incurred by
the Beneficiary in exercising such rights and in managing, operating,
maintaining, protecting or preserving the Property and the Associated Materials
and to apply the remainder of such proceeds on the indebtedness secured hereby
in such manner as the Beneficiary may elect.  If necessary to obtain
the possession provided for above, the Beneficiary may invoke any and all legal
remedies to dispossess Grantor.

    

    
      
        
           

        

        
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    2.4           Foreclosure
as Deed of Trust.  Upon the occurrence of a default hereunder,
which is not cured during the applicable cure period, if any, the Beneficiary
may declare a violation of any of the covenants hereof and elect to advertise
the Mortgaged Property, the Associated Materials, and all improvements and other
rights relating to the foregoing, for sale and demand such
sale.  Then, upon filing notice of such election and demand for sale
with the Trustee, the Trustee shall proceed to foreclose upon the Property and,
if directed to do so by the Beneficiary, upon the Associated Materials, all as
provided by applicable law.  The Trustee shall provide public notice
of such foreclosure sale as provided by applicable law.  The Trustee
shall sell and dispose of the Property, the Associated Materials, and all
improvements and rights relating to the foregoing (en masse or in separate
parcels, as the Trustee may think best) and all the right, title and interest of
Grantor, and its successors and assigns therein, at public auction all in
accordance with the provisions of Colorado Statutes.  Such sale(s)
shall be a perpetual bar, both in law and equity, against Grantor and its
successors and assigns, and all other persons claiming the Mortgaged Property,
the Associated Materials, and all improvements and rights relating to the
foregoing, or any part thereof by, through, from or under
Grantor.  The Beneficiary may purchase the Mortgaged Property, the
Associated Materials, and all improvements and rights relating the foregoing, or
any part thereof, and may bid in any part or all of the indebtedness secured
hereby, and the purchaser(s) at any such sale shall not be obligated to see to
the application of the purchase money.

    

    Any reasonable costs incurred by
Beneficiary or its attorney as a part of the cost of foreclosure in conjunction
with Grantor's default hereunder shall be deemed allowable by the Trustee in a
foreclosure action.  Such allowable costs shall include, but not be
limited to, appraisal fees, attorney fees and all costs incurred by Beneficiary
or its attorney in conjunction with securing, preserving and maintaining the
Property, the Associated Materials and any improvements and rights relating to
the foregoing, such as, by way of example and not by way of limitation, costs
incurred in conjunction with the appointment and/or institution of a
receivership (whether or not a receiver be appointed).

    

    2.5           Foreclosure
as Mortgage.  This instrument shall be effective as a mortgage
and a security agreement as well as a deed of trust and, upon the occurrence of
a default, may be foreclosed, at the election of the Beneficiary, as to any of
the Property or the Associated Materials in any manner permitted by the laws of
the State of Colorado.

    

    2.6           Application
of Proceeds.  The proceeds of any sale in foreclosure of the
liens evidenced hereby shall be applied:

    

    FIRST, to the payment of all
costs and expenses incident to such foreclosure sale, including, but not limited
to, all reasonable attorneys' fees and court costs and charges of every
character, and the statutory fee to the Trustee;

    

    SECOND, to the payment in full
of the Secured Indebtedness (including, specifically, without limitation, the
principal, interest, late charges and attorneys' fees due and unpaid on the Note
and the amounts due and unpaid and owed to the Beneficiary under this Deed of
Trust) in such order as the Beneficiary may elect; and

    

    
      
        
           

        

        
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    THIRD, the remainder, if any,
shall be paid in accordance with applicable statutory provisions or court
order.

    

    2.7           Receiver.  In
addition to all other remedies herein provided for, Grantor agrees that upon the
occurrence of a default, the Beneficiary shall, as a matter of right, be
entitled to an ex parte appointment of a receiver or receivers for all or any
part of the Property and the Associated Materials without regard to the value of
the Property or the Associated Materials or to the solvency of any person or
persons liable for the payment of the indebtedness secured hereby, and Grantor
does hereby consent to the appointment of such receiver or receivers, waives any
and all defenses to such appointment and agrees not to oppose any application
therefor by the Beneficiary, but nothing herein is to be construed to deprive
Beneficiary of any other right, remedy or privilege it may now have under the
law to have a receiver appointed; provided, however, that the appointment of
such receiver, trustee or other appointee by virtue of any court order, statute
or regulation shall not impair or in any manner prejudice the rights of the
Beneficiary to receive payment of the rents and income.  The receiver
or his/her/its agents shall be entitled to enter upon and take possession of any
and all of the Property and the Associated Materials.  The receiver,
personally or through its agents or attorneys, may exclude Grantor and its
agents, servants and employees wholly from the Property and the Associated
Materials and have, hold, use, operate, manage and control the same and each and
every part thereof, and keep insured, the Property and the Associated
Materials.  Such receivership shall, at the option of the Beneficiary,
continue until full payment of all sums, hereby secured, then due and payable or
until title to the Property and the Associated Materials shall have passed by
foreclosure sale under this Deed of Trust and the period of redemption, if any,
shall have expired.

    

    2.8           Remedies
Cumulative.  All remedies herein expressly provided for are
cumulative of any and all other remedies existing at law or in equity and are
cumulative of any and all other remedies provided for in any other instrument
securing the payment of the Secured Indebtedness, or any part thereof, or
otherwise benefiting the Beneficiary, and the Trustee and the Beneficiary shall,
in addition to the remedies herein provided, be entitled to avail themselves of
all such other remedies as may now or hereafter exist at law or in equity for
the collection of the Secured Indebtedness and the enforcement of the covenants
herein and the foreclosure of the liens and security interests evidenced hereby,
and the use of any remedy provided for hereunder or under any such other
instrument or provided for by law shall not prevent the concurrent or subsequent
use of any other appropriate remedy or remedies.  The Beneficiary
shall be entitled to enforce the provisions of this Deed of Trust and to
exercise its rights and remedies hereunder notwithstanding that some or all of
the indebtedness hereby secured is now or shall hereafter be otherwise secured,
whether by mortgage, pledge, lien, assignment or otherwise.  Neither
the acceptance of this Deed of Trust nor the enforcement thereof shall prejudice
or in any manner affect the right of the Beneficiary to realize upon or enforce
any other security now or hereafter held by the Beneficiary, it being understood
that the Beneficiary shall be entitled to enforce this Deed of Trust and any
other security now or hereafter held by it in such order and manner as it may in
its sole discretion determine.

    

    2.9           Election
of Remedies.  The Beneficiary may resort to any security given
by this Deed of Trust or to any other security now existing or hereafter given
to secure the payment of the Secured Indebtedness, in whole or in part, and in
such portions and in such order as may seem best to the Beneficiary in its sole
discretion.

    

    
      
        
           

        

        
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    2.10           Tenancy
of Grantor.  In the event there is a foreclosure sale hereunder
and at the time of such sale Grantor or its representatives, successors or
assigns or any other persons claiming any interest in the Property and/or the
Associated Materials by, through or under Grantor are occupying or using the
Property and/or the Associated Materials, or any part thereof, each and all
shall, at the option of the Beneficiary or the purchaser at such sale, as the
case may be, immediately become the tenant of the Beneficiary or said purchaser
and said tenancy shall be terminable at will by the Beneficiary or said
purchaser, as the case may be.  In the event any tenant fails to
surrender possession of said Property and Associated Materials upon the exercise
of such option, the purchaser shall be entitled to institute and maintain an
action for forcible entry and detainer.

    

    3.           Miscellaneous.

    

    3.1           Release.  If
the Secured Indebtedness is paid in full, then and in that event only, all
rights under this Deed of Trust shall be released by the Beneficiary in due form
at Grantor's cost.  No release of this Deed of Trust or the lien
thereof shall be valid unless executed by the Beneficiary.

    

    3.2           Beneficiary
Rights.  Without affecting the responsibility of Grantor for
the performance of the covenants and agreements herein contained, and without
affecting the lien of this Deed of Trust upon any of the Property and the
Associated Materials, the Beneficiary may at any time and from time to time
without notice in writing:  (a) waive compliance by Grantor with any
covenant herein made by Grantor to the extent and in the manner specified in
such writing; (b) consent to Grantor doing any act which hereunder Grantor is
required to do, to the extent and in the manner specified in such writing; (c)
release any part of the Property and/or the Associated Materials, or any
interest therein, from the lien and security interest of this Deed of Trust; (d)
release any party liable, either directly or indirectly, for the Secured
Indebtedness or for any covenant herein or in any other instrument now or
hereafter securing the payment of the Secured Indebtedness, without impairing or
releasing the liability of any other party; (e) extend the time for payment of
the Note or otherwise grant indulgences or modify the Note, or (f) subordinate
the lien hereof.

    

    3.3           Maximum
Interest.  Any provision contained herein, in the Note or in
any other instrument evidencing, securing or otherwise relating to any of the
Secured Indebtedness to the contrary notwithstanding, the Beneficiary shall not
be entitled to receive or collect, nor shall Grantor be obligated to pay,
interest on any of the Secured Indebtedness in excess of the maximum rate of
interest permitted by applicable law, and if any provision herein, in the Note
or in such other instrument shall ever be construed or held to permit the
collection or to require the payment of any amount of interest in excess of that
permitted by applicable law, the provisions of the Note shall control and shall
override any contrary or inconsistent provision herein or in such other document
or instrument.

    

    
      
        
           

        

        
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    3.4           Notices.  Any
and all notices, elections, demands, requests, and responses thereto permitted
or required to be given under this Deed of Trust shall be in writing, signed by
or on behalf of the party giving the same, and shall be deemed to have been
properly given and shall be effective upon being personally delivered, or upon
being deposited in the United States mail, postage prepaid, certified with
return receipt requested, or upon being deposited with an overnight commercial
delivery service requiring proof of delivery, to the other party at the address
of such other party set forth above or at such other address within the
continental United States or Canada as such other party may designate by notice
specifically designated as a notice of change of address and given in accordance
herewith; provided, however, that the time period in which a response to any
such notice, election, demand or request must be given shall commence on the
date of receipt thereof; and provided further that no notice of change of
address shall be effective until the date of receipt
thereof.  Personal delivery to a party or to any officer, partner,
agent or employee of such party at said address shall constitute
receipt.  Rejection or other refusal to accept or inability to deliver
because of changed address of which no notice has been received shall also
constitute receipt.  Any such notice, election, demand, request or
response to the respective parties shall be addressed to the addresses provided
above.  A copy of any notices addressed to the Trustee and/or the
Beneficiary shall be delivered at the same time to Pushor Mitchell LLP, 3rd Floor,
1665 Ellis Street, Kelowna, BC, Canada, V1Y 2B3, attention E. Blair
Forrest.

    

    3.5           Binding
Effect.  The terms, provisions, covenants and conditions hereof
shall be binding upon Grantor and the heirs, representatives, successors and
assigns of Grantor, including all heirs and successors in interest of Grantor in
and to all or any part of the Property and/or the Associated Materials, and
shall inure to the benefit of Grantor, the Trustee and the Beneficiary and their
respective successors and assigns, substitutes and assigns and shall constitute
covenants running with the land.  All references in this Deed of Trust
to Grantor, the Trustee or the Beneficiary shall be deemed to include all such
representatives, successors, substitutes and assigns.

    

    3.6           Invalidity.  A
determination that any provision of this Deed of Trust is unenforceable or
invalid shall not affect the enforceability or validity of any remaining
provision, and any determination that the application of any provision of this
Deed of Trust to any person or circumstance is illegal or unenforceable shall
not affect the enforceability or validity of such provision as it may apply to
any other persons or circumstances.

    

    3.7           Redemption.  In
the event the Property or any part thereof shall be sold upon foreclosure as
provided hereunder, the sum for which the same shall have been sold shall, for
purposes of redemption (pursuant to Section 38-38-301, et seq., C.R.S., or the
corresponding provisions of any future law), bear interest at the rate of
interest provided in the Note from the date of sale until paid.

    

    3.8           Governing
Law.  This Deed of Trust and the Note secured hereby shall be
governed by and construed according to the laws of the State of Colorado at the
date of execution.

    

    
      
        
           

        

        
          8

          
            

          

        

        
           

        

      

    

    

    3.9           Grantor’s
Liability.  The Grantor’s liability is limited pursuant to the
terms of the Note.  In the event of a default under the Note, the
Grantor shall be personally liable solely for the Limited Recourse Amount as
defined in the Note, subject to the terms and limitations contained in the
Note..

    

    Signature
Page Follows

    
      
        
           

        

        
          9

          
            

          

        

        
           

        

      

    

    

    IN WITNESS WHEREOF, the
Grantor has executed this instrument as of the date first set forth
above.

    

    
      
        
          	
                  GRANTOR:

                
	 
      
	
                  HUNTER
      BATES MINING CORPORATION

                
	 
      
	
                  By: 

                	 
      

        

      

    

    

    STATE OF
MINNESOTA                             )

    ) ss.

    COUNTY OF
Hennepin                                 )

    

    The foregoing instrument was
acknowledged before me this ___ day of ________, 2008, by ___________________,
as ___________________ of Hunter Bates Mining Corporation, a Minnesota
corporation, on behalf of the corporation.

    

    
      
        
          
            
              	 
      
	
                      Notary
      Public

                    

            

          

        

      

    

    

    Signature
Page to Deed of Trust

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    EXHIBIT
A

    TO

    DEED
OF TRUST

    

    LEGAL
DESCRIPTION

    

    Exhibit
A

    

    PARCEL GROUP
A:

    

    Parcel
A-1:

    

    The BATES
LODE Mining Claim, U. S. Survey No. 224, as described in the United States
Patent recorded on November 21, 1876, in Book 62 at Page 287,

    EXCEPTING
AND EXCLUDING all town property rights upon the surface and all houses,
buildings, structures, lots, blocks, streets, alleys and other municipal
improvements on the surface, and all rights necessary or proper to the
occupation, possession or enjoyment of the same, as excepted and excluded in the
said United States Patent,

    County of
Gilpin, State of Colorado.

    

    Parcel
A-2:

    

    The CARR
LODE Mining Claim, U. S. Survey No. 442, as described in the United States
Patent recorded on August 7, 1879, in Book 68 at Page 349,

    EXCEPTING
AND EXCLUDING therefrom any portion thereof embraced by Survey No. 173, as
excepted and excluded in the said United States Patent,

    County of
Gilpin, State of Colorado.

    

    Parcel
A-3:

    

    Mineral
rights only in and to the ELLIETH LODE Mining Claim, U. S. Survey No. 37, as
described in the United States Patent recorded on June 20, 1872, in Book 53 at
Page 277,

    County of
Gilpin, State of Colorado.

    

    Parcel
A-4:

    

    An
undivided 2/3 interest in and to the East 185 feet, being the discovery claim,
and 85 feet of the West end of Claim No. 1 East of the discovery claim of the
GERMAN LODE Mining Claim, U. S. Survey No. 204, the said GERMAN LODE Mining
Claim being described in the United States Patent recorded on August 24, 1874,
in Book 58 at Page 74,

    County of
Gilpin, State of Colorado.

    

    Parcel
A-5:

    

    The East
715 feet of the West 1,100 feet Claim of the GERMAN LODE Mining Claim, U. Survey
No. 204, the said GERMAN LODE Mining Claim being described in the United States
Patent recorded on August 24, 1874, in Book 58 at Page 74,

    County of
Gilpin, State of Colorado.

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    Parcel
A-6:

    

    Surface
rights only in and to that portion of the HOPE NO. 2 LODE Mining Claim, U. S.
Survey No. 252, as described in the United States Patent recorded on September
16, 1970, in Book 268 at Page 311, that lies Southwest of Block 47, in the City
of Central,

    EXCEPTING
AND EXCLUDING therefrom all town property rights upon the surface, and excepting
and excluding from the same all houses, buildings, structures, lots, blocks,
streets, alleys or other municipal improvements, as excepted and excluded in the
said United States Patent,

    County of
Gilpin, State of Colorado.

    

    Parcel
A-7:

    

    The
HUNTER LODE Mining Claim, U. S. Survey No. 266, as described in the United
States Patent recorded on June 22, 1883, in Book 93 at Page 137,

    EXCEPTING
AND EXCLUDING therefrom all town property rights upon the surface and all
houses, buildings, structures, lots, blocks, streets, alleys and other municipal
improvements on the surface, and all rights necessary or proper to the
occupation, possession or enjoyment of the same, as excepted and excluded in the
said United States Patent,

    County of
Gilpin, State of Colorado.

    

    Parcel
A-8:

    

    Mineral
rights in and to the KITTY LODE Mining Claim, U. S. Survey No. 734, a described
in the United States Patent recorded in Book 246 at Page 437, together with that
portion of the surface of the said KITTY LODE Mining Claim lying East of the
railroad right of way,

    EXCEPTING
AND EXCLUDING therefrom any portion thereof embraced by Lots Nos. 72, 204, 252,
267, 730, and all town property rights upon the surface and all houses,
buildings, structures, lots, blocks, streets, alleys and other municipal
improvements on the surface, and all rights necessary or proper to the
occupation, possession or enjoyment of the same, as excepted and excluded in the
said United States Patent,

    County of
Gilpin, State of Colorado.

    

    Parcel
A-9:

    

    Mineral
rights only in and to the LEAVITT LODE Mining Claim, U. S. Survey No. 76, as
described in the United States Patent recorded on November 6, 1871, in Book 53
at Page 83,

    EXCEPTING
AND EXCLUDING any portion thereof embraced by Survey No. 37, as excepted and
excluded in the said United States Patent,

    County of
Gilpin, State of Colorado.

    

    Parcel
A-10:

    

    Surface
rights only in and to that portion of the MOSELL LODE Mining Claim, U. S. Survey
No. 675, lying Northeast of the railroad right of way crossing the said MOSELL
LODE Mining Claim, as the said MOSELL LODE Mining Claim is described in the
United States Patent recorded on September 12, 1988, in Book 296 at Page
419,

    EXCEPTING
AND EXCLUDING therefrom any portion thereof embraced by Mining Claims or Surveys
Nos. 311, 500 and 609, as excepted and excluded in the said United States
Patent,

    County of
Gilpin, State of Colorado.

    

    Parcel
A-11

    

    The SAXON
LODE Mining Claim, U. S. Survey No. 730, as described in the United States
Patent recorded in Book 296 at Page 426,

    EXCEPT
that portion of the surface of the said SAXON LODE Mining Claim which lies
between the Gregory Street and Lawrence Street rights of way,

    EXCEPTING
AND EXCLUDING therefrom any portion thereof embraced by Mining Claims or Surveys
Nos. 37, 73, 76, 204, 224, 235, 266, 276, 372 506, 590, 607 and 675 and all town
property rights upon the surface and all houses, buildings, structures, lots,
blocks, streets, alleys and other municipal improvements on the surface, and all
rights necessary or proper to the occupation, possession or enjoyment of the
same, as excepted and excluded in the said United States Patent,

    
      EXCEPT
surface rights in and to that portion of the said SAXON LODE Mining Claim that
is Southwest of the railroad right of way,

      AND
EXCEPT the railroad right of way which crosses the said SAXON LODE Mining
Claim,

      County of
Gilpin, State of Colorado.

    

     

    
      
        
           

        

        
          12

          
            

          

        

        
           

        

      

    

     

    Parcel
A-12:

    

    Lots 3, 4
and 5,

    Block
47,

    City of
Central,

    County of
Gilpin,

    State of
Colorado.

    

    Parcel
A-13:

    Lots
1-11,

    Block
48,

    City of
Central,

    County of
Gilpin,

    State of
Colorado.

    

    Parcel
A-14:

    

    Mineral
rights only in and to Lot 1,

    Block
49,

    City of
Central,

    County of
Gilpin,

    State of
Colorado.

    

    Parcel
A-15:

    

    Conrad
Lot, City of Central, described in deed recorded in Book 150 at Page 332,
to-wit: Beginning at a point on Line 5-6 of Survey No. 73, Kip Lode, whence
Corner No. 5 of Survey No. 73 bears N 68 30’ E, 6.24 feet and Station No. 2
Leavitt Street bears N 5 56’ W, 297.3 feet; thence S 68 30’ W, 45.76 feet;
thence S 27 W, 76 feet; thence N 86 15’ E, 82.5 feet; thence N 3 45’ W, 79.53
feet to Place of Beginning, County of Gilpin, State of Colorado.

    

    PARCEL GROUP
B:

    

    Parcel
B-1:

    

    Mineral
rights only in and to the ELLIOTT LODE Mining Claim, U. S. Survey No. 77, as
described in the United States Patent recorded on November 6, 1871, in Book 53
at Page 80,

    EXCEPTING
AND EXCLUDING therefrom any portion thereof embraced by Survey No. 76, as
excepted and excluded in the said United States Patent,

    County of
Gilpin, State of Colorado.

    

    Parcel
B-2:

    

    Mineral
rights only in and to the HARTFORD LODE Mining Claim, U. S. Survey No. 742, as
described in the United States Patent recorded on September 12, 1988, in Book
393 at Page 333,

    EXCEPTING
AND EXCLUDING therefrom any portion thereof embraced by Mining Claims or Surveys
Nos. 56, 64, 73, 204, 235, 506, 675, 730, 734, 739, 753, and Bledsoe and Simmons
Lodes, as excepted and excluded in the said United States Patent, 

    County of Gilpin, State of Colorado.

     

    
      
        
           

        

        
          13

          
            

          

        

        
           

        

      

    

     

    Parcel
B-3:

    

    Mineral
rights only in and to the HUNTER LODE Mining Claim, U. S. Survey No. 507, as
described in the United States Patent recorded on December 16, 1881, in Book 82
at Page 12,

    County of
Gilpin, State of Colorado.

    

    Parcel
B-4:

    

    Mineral
rights only in and to the East 450 feet of the KIP LODE Mining Claim, U. S.
Survey No. 73, and surface rights only in and to that portion of the said KIP
LODE Mining Claim, U. S. Survey No. 73, that is East of the East side-line of
the Ontonagon Lode Mining Claim, U. S. Survey No. 506, as the said KIP LODE
Mining Claim, U. S. Survey No. 73, is described in the United States Patent
recorded on November 6, 1871, in Book 53 at Page 77,

    EXCLUSIVE
OF “ground previously conveyed, the portions of all other claims previously
surveyed and patented by the United States and falling within the boundary lines
hereinbefore described,” as provided in the said United States
Patent,

    County of
Gilpin, State of Colorado.

    

    Parcel
B-5:

    

    Mineral
rights only in and to the McCALLISTER LODE Mining Claim, U. S. Survey No. 235,
as described in the United States Patent recorded on December 17, 1975, in Book
296 at Page 413,

    EXCEPTING
AND EXCLUDING therefrom any portion thereof embraced by Mining Claims or Surveys
Nos. 53 and 62, as excepted and excluded in the said United States
Patent,

    County of
Gilpin, State of Colorado.

    

    Parcel
B-6:

    

    Mineral
rights only in and to the ONTONAGON LODE Mining Claim, U. S. Survey No. 506, as
described in the United States Patent recorded on February 28, 1892, in Book 82
at Page 40,

    EXCEPTING
AND EXCLUDING therefrom any portion thereof embraced by Mining Claims or Surveys
Nos. 37, 62, 73, 76, 204 and 235, as excepted and excluded in the said United
States Patent,

    County of
Gilpin, State of Colorado.

    

    Parcel
B-7:

    

    A
permanent easement to the German Mine site, located on the German Mining Claim,
Survey #204, form Packard Street in the City of Central.  This
easement grants regular vehicle and truck traffic related to the German Mine
site, located on the German Mining Claim Survey #204;

    And

    A
permanent easement to the German Mine site, located on the German Mining Claim,
Survey #204, form the nearest developed street in the Mammoth Hill planned Unit
Development;

    And

    A surface
area of 100 foot radius from the center of the German Mine Shaft, located on the
German Mining Claim Survey #204, as designated for the purpose of erecting a
headframe, locating a hoisthouse hoist, and usual mining equipment and to
maintain an escapeway while mining the German Mining Claim is being actively
pursued,

    County of
Gilpin, State of Colorado

    

    
      
        
           

        

        
          14

          
            

          

        

        
           

        

      

    

    

    EXHIBIT
I

    

    UNDERTAKING
AGREEMENT

    

    Dated as
of the 5th day of June, 2008.

    

    AMONG:

    

    Hunter Gold Mining Corp., a
British Columbia corporation

    

    (“HGM
Corp.”)

    

    -
and -

    

    George Otten, a Colorado
resident

    

    (“Otten”)

    

    -
and -

    

    Dell
Balfour, a British Columbia resident

    

    (“Balfour”)

    

    -
and -

    

    Douglas MacNaughton; a British
Columbia resident

    

    (“MacNaughton”)

    OF THE
FIRST PART

    AND:

    Wits Basin Precious Minerals
Inc., A Minnesota corporation

    

    (“Wits
Basin” )

    

    -
and -

    

    Hunter Bates Mining
Corporation, a Minnesota corporation

    

    (“Hunter
Bates”)

    OF THE
SECOND PART

    WHEREAS:

    

    
      	
              A.

            	
              HGM
      Corp., together with its beneficially owned subsidiary Hunter Gold Mining
      Inc. (“SubCo”), a Colorado corporation, Central City Consolidated Corp., a
      Colorado corporation controlled by Otten, and Otten, has entered into an
      asset purchase agreement, as amended, with Wits Basin (the “Asset Purchase
      Agreement”).

            

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    
      	
              B.

            	
              Wits
      Basin has assigned its interest in the Asset Purchase Agreement to Hunter
      Bates.

            

    

    

    
      	
              C.

            	
              Hunter
      Bates has requested that the closing date of the Asset Purchase Agreement
      be expedited.

            

    

    

    
      	
              D.

            	
              The
      Asset Purchase Agreement contemplates the delivery of certain legal
      opinions on behalf of certain parties thereto, including HGM Corp. and
      SubCo.

            

    

    

    
      	
              E.

            	
              Colorado
      counsel for SubCo has advised that the transactions contemplated by the
      Asset Purchase Agreement will amount to the disposition of substantially
      all of the assets and undertaking of SubCo and HGM Corp. and,
      consequently, the approval of the shareholders of HGM Corp. is required.
      They have also requested that HGM Corp. and the directors and officers of
      SubCo execute various resolutions and other corporate documents in respect
      of SubCo.

            

    

    

    
      	
              F.

            	
              British
      Columbia counsel for HGM Corp. has advised that if the transactions
      contemplated by the Asset Purchase Agreement constitute the disposition of
      substantially all of the assets and undertaking of HGM Corp., the
      transaction must be approved by a special majority of the shareholders of
      HGM Corp. voting at a meeting of the HGM Corp. shareholders convened for
      that purpose or, alternatively, by way of a unanimous written consent
      resolution of the HGM Corp.
shareholders.

            

    

    

    
      	
              G.

            	
              The
      parties are of the view that obtaining the requisite HGM Corp. shareholder
      approval prior to closing the Asset Purchase Agreement will unduly delay
      the closing and the parties wish to provide for a mechanism that will
      allow the parties to complete the closing of the Asset Purchase Agreement
      prior to the HGM Corp. shareholder meeting to approve the
      transaction.

            

    

    

    
      	
              H.

            	
              Otten,
      Balfour and MacNaughton are the only directors of HGM Corp. and, as such,
      have the authority to convene a meeting of the shareholders of HGM
      Corp.

            

    

    

    NOW
THEREFORE, in consideration of the mutual promises. set out in this agreement
and in consideration of hunter bates agreeing to close the asset purchase
agreement prior to hgm corp. obtaining shareholder approval of the transaction,
the parties agree as follows:

    

    1.           Otten,
Balfour and MacNaughton, in their capacity as directors of HGM Corp. and on
behalf of HGM Corp., hereby undertake and agree to cause HGM Corp. to convene an
extraordinary meeting of the shareholders of HGM Corp. at the earliest possible
time and, in any event; not later than 60 days from the date of the Undertaking
Agreement, for the purposes of seeking shareholder approval of a special
resolution ratifying and approving the Asset Purchase Agreement and the
transactions contemplated thereunder (the “Special
Resolution”).

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    2.           Otten,
Balfour and MacNaughton, in their capacities as directors of HGM Corp. and on
behalf of. HGM Corp., hereby undertake and agree to recommend the approval of
the Asset Purchase Agreement and the transactions contemplated thereunder to the
shareholders of HGM Corp. and the Special Resolution.

    

    3.           HGM
Corp., together with Otten, Balfour and MacNaughton, in their capacities as
directors of HGM Corp. and on behalf of HGM Corp., hereby undertake and agree to
take all steps and to do all things reasonably necessary and appropriate to
obtain the approval of the HGM Corp. shareholders to the Special
Resolution.

    

    4.           HGM
Corp., together with Otten, Balfour and MacNaughton, in their capacities as
directors of HGM Corp. and on behalf of HGM Corp., hereby agree that, pursuant
to section 30l(3)(a) of the Business Corporations Act
(British Columbia), the closing of the Asset Purchase Agreement prior to
obtaining the approval of the Special Resolution by the HGM Corp. shareholders
will not be invalid for that reason and hereby undertake not to assert, or
assist others in asserting, that the completion of the transactions contemplated
by the Asset Purchase Agreement are invalid as a result of the absence of the
approval of the Special Resolution by the HGM Corp. shareholders prior to the
closing of the Asset Purchase Agreement.

    

    5.           HGM
Corp., together with Otten, Balfour and MacNaughton, in their capacities as
directors of HGM Corp. and on behalf of HGM Corp., hereby agrees to cause SubCo
and the directors and officers of SubCo to execute all transaction documents and
all internal corporate documents reasonably necessary, in the opinion of SubCo’s
Colorado legal counsel, to enable SubCo to complete the transactions
contemplated by the Asset Purchase Agreement, including all ancillary documents
reasonably required to be signed by or on behalf of SubCo to enable Hunter Bates
to obtain title insurance in respect of the real property interests it is
acquiring under the Asset Purchase Agreement.

    

    6.           HGM
Corp., together with Otten, Balfour and MacNaughton, in their capacities as
directors of HGM Corp, and on behalf of HGM Corp., hereby agrees that, upon HGM
Corp. obtaining the shareholder approval contemplated in paragraph 4 above, it
shall cause its British Columbia counsel to deliver a legal opinion to counsel
for Hunter Bates and Wits Basin substantially in the form attached hereto as
Schedule “A” in connection with the closing of the Asset Purchase.
Agreement.

    

    7.           Time
is of the essence of this Agreement.

    

    8.           Thus
Agreement will be governed by and interpreted in accordance with the laws of the
State of Colorado.

    

    9.           This
Agreement may be executed in several counterparts, including by facsimile, each
of which when executed shall be deemed to be an original and such counterparts
together shall be but one and the same instrument.

    

    Signed by
the parties hereto as of the date referenced on the first page
hereof.

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    

    
      
        
          
            	
                    HUNTER
      GOLD MINING CORP.

                  	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	
                    Per:  

                  	
                      

                  	 
      	 
      
	 
      	
                      Authorized
      Signatory

                  	 
      	 
      
	 
      	 
      	 
      
	
                    SIGNED,
      SEALED & DELIVERED

                  	
                    )

                  	 
      
	
                    in
      the presence of:

                  	
                    )

                  	 
      
	 
      	
                    )

                  	 
      
	
                      

                  	
                    )

                  	 
      
	
                    Signature

                  	
                    )

                  	 
      
	 
      	
                    )

                  	 
      
	
                      

                  	
                    )

                  	 
      
	
                    Print
      Name

                  	
                    )

                  	
                    GEORGE
      OTTEN

                  
	 
      	
                    )

                  	 
      
	 
      	
                    )

                  	 
      
	
                      

                  	
                    )

                  	 
      
	
                    Address

                  	
                    )

                  	 
      
	 
      	
                    )

                  	 
      
	
                      

                  	
                    )

                  	 
      
	
                    Occupation

                  	 
      	 
      
	 
      	 
      	 
      
	
                    SIGNED,
      SEALED & DELIVERED

                  	
                    )

                  	 
      
	
                    in
      the presence of:

                  	
                    )

                  	 
      
	 
      	
                    )

                  	 
      
	
                      

                  	
                    )

                  	 
      
	
                    Signature

                  	
                    )

                  	 
      
	 
      	
                    )

                  	 
      
	
                      

                  	
                    )

                  	 
      
	
                    Print
      Name

                  	
                    )

                  	
                    DELL
      BALFOUR

                  
	 
      	
                    )

                  	 
      
	
                      

                  	
                    )

                  	 
      
	
                    Address

                  	
                    )

                  	 
      
	 
      	
                    )

                  	 
      
	
                      

                  	
                    )

                  	 
      
	
                    Occupation

                  	 
      	 
      

          

        

      

    

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    

    
      
        
          
            
              
                
                  	
                          SIGNED,
      SEALED & DELIVERED

                        	
                          )

                        	 
      
	
                          in
      the presence of:

                        	
                          )

                        	 
      
	 
      	
                          )

                        	 
      
	 
      	
                          )

                        	 
      
	
                          Signature

                        	
                          )

                        	 
      
	 
      	
                          )

                        	 
      
	 
      	
                          )

                        	 
      
	
                          Print
      Name

                        	
                          )

                        	
                          DOUGLAS
      MacNAUGHTON

                        
	 
      	
                          )

                        	 
      
	
                          .

                        	
                          )

                        	 
      
	
                          Address

                        	
                          )

                        	 
      
	 
      	
                          )

                        	 
      
	  
      	
                          )

                        	 
      
	
                          Occupation

                        	 
      	 
      
	 
      	 
      	 
      
	
                          WITS
      BASIN PRECIOUS MINERALS INC.

                        	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	
                          Per:  

                        	
                            

                        	 
      	 
      
	 
      	
                            Authorized
      Signatory

                        	 
      	 
      
	 
      	 
      	 
      
	
                          HUNTER
      BATES MINING CORPORATION

                        	 
      
	 
      	 
      	 
      
	
                          Per:

                        	
                            

                        	 
      	 
      
	 
      	
                            Authorized
      Signatory

                        	 
      	 
      

                

              

            

          

        

      

    

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    EXHIBIT
J

    

    SHAREHOLDER
VOTING AGREEMENT

     

    Dated as
of the 6th day of June, 2008.

     

    AMONG:

    

    George E. Otten, a Colorado
resident

    

    (“GE
Otten”)

    

    and:

    

    George D. Otten, a Colorado
resident

    

    (“GD
Otten”)

    

    and:

    

    Joanne Otten, a Colorado
resident

    

    (“J
Otten”)

    

    and:

    

    Christopher D. Otten, a
Colorado resident

    

    (“CD
Otten”)

    

    and:

    

    Dell Balfour, a British
Columbia resident

    

    (“Balfour”)

    

    and:

    

    Douglas MacNaughton, a British
Columbia resident

    

    (“MacNaughton”)

    

    and:

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    Central City Consolidated
Corp., a Colorado corporation, doing business as “Central City
Consolidated Mining Co.”

    

    (“Central
City”)

    

    and:

    

    Pier Mac Petroleum Installation
Ltd., a British Columbia corporation

    

    (“Pier
Mac”)

    

    and:

    

    Taican Enterprise Corp., a
British Columbia corporation

    

    (“Taican”)

    

    OF THE
FIRST PART

     

    AND:

    

    Wits Basin Precious Minerals
Inc., A Minnesota corporation

    

    (“Wits
Basin”)

    

    and:

    

    Hunter Bates Mining
Corporation, a Minnesota corporation

    

    (“Hunter
Bates”)

    

    OF THE
SECOND PART

    

    WHEREAS:

     

    
      	
              A.

            	
              Hunter
      Gold Mining Corp. (“HGM Corp.”), together with its beneficially owned
      subsidiary Hunter Gold Mining Inc., a Colorado corporation, Central City,
      and GE Otten, has entered into an asset purchase agreement, as amended,
      with Wits Basin (the “Asset Purchase
  Agreement”).

            

    

     

    
      	
              B.

            	
              Wits
      Basin has assigned its interest in the Asset Purchase Agreement to Hunter
      Bates.

            

    

     

    
      	
              C.

            	
              Hunter
      Bates has requested that the closing date of the Asset Purchase Agreement
      be expedited.

            

    

     

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    
      	
              D.

            	
              HGM
      Corp. intends to seek shareholder ratification and approval of the Asset
      Purchase Agreement and the transactions contemplated thereby, from the HGM
      Corp. shareholders subsequent to the closing of the Asset Purchase
      Agreement.

            

    

     

    
      	
              E.

            	
              GE
      Otten, GD Otten, J Otten and CD Otten are closely related family members
      (collectively, the “Ottens”) who between them control more than 50% of the
      voting securities of Central City.

            

    

     

    
      	
              F.

            	
              Pier
      Mac is controlled by MacNaughton.

            

    

     

    
      	
              G.

            	
              Taican
      is controlled by Balfour.

            

    

     

    
      	
              H.

            	
              Each
      of the Ottens, Central City, Pier Mac and Taican are shareholders of HGM
      Corp. and collectively control 1,399,910 common voting shares of HGM Corp.
      out of an aggregate of 2,619,954 issued and outstanding voting common
      shares.

            

    

     

    
      	
              I.

            	
              The
      parties are all of the view that obtaining the requisite HGM Corp.
      shareholder approval prior to closing the Asset Purchase Agreement will
      unduly delay the closing and the parties wish to provide for a mechanism
      that will allow the parties to complete the closing of the Asset Purchase
      Agreement prior to the HGM Corp. shareholder meeting to approve the
      transaction.

            

    

     

    
      	
              J.

            	
              Each
      of the Ottens, Central City, Pier Mac and Taican have agreed to cause all
      of their presently owned and after-acquired HGM Corp. shares (the “HGM
      Shares”) to be voted in favour of the approval of the Asset Purchase
      Agreement at a meeting of the shareholders of HGM Corp. to be convened for
      that purpose.

            

    

     

    
      	
              K.

            	
              Each
      of the Ottens, Central City, Pier Mac and Taican (collectively, the
      “Parties”), as shareholders of HGM Corp., will benefit directly and/or
      indirectly from the completion of the transactions contemplated by the
      Asset Purchase Agreement.

            

    

     

    NOW
THEREFORE, in consideration of the mutual promises set out in this agreement and
in consideration of hunter bates agreeing to close the asset purchase agreement
prior to hgm corp. obtaining shareholder approval of the transaction, the
parties agree as follows:

     

    1.           The
Parties hereby agree to vote, in person or by duly authorized and delivered
proxy or power of attorney, all of the HGM Shares presently owned by them,
together with any HGM Shares acquired by them after the date hereof, and
including, without limitation, any HGM Shares in respect of which they then hold
a valid voting proxy and/or power of attorney, in favour of all resolutions
presented to the HGM Corp. shareholders for the purposes of ratifying and
approving the Asset Purchase Transaction and all transactions contemplated
thereby (the “Shareholder Resolutions”).  The parties further agree
that until the Shareholder Resolutions have been ratified and approved, none of
the parties of the first part shall transfer or otherwise dispose of any HGM
Shares held by them, nor grant any voting proxy or power of attorney over such
HGM Shares, except to one or more of GE Otten, Balfour or
MacNaughton.

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    2.           The
Parties, in their capacities of shareholders of HGM Corp., agrees to support and
recommend the approval of the Shareholder Resolutions to all other HGM Corp.
Shareholders.

    

    3.           This
Agreement shall enure to the benefit of and be binding upon the respective
heirs, executors, administrators and permitted assigns of the
Parties.

    

    4.           This
Agreement shall be governed by the laws of the State of Colorado.

    

    5.           Time
shall be of the essence of this Agreement.

    

    6.           A
copy of this Agreement delivered by facsimile or other telecopier machine and
bearing a copy of the signature of a party to this Agreement shall for all
purposes be treated and accepted as an original copy thereof.  This
Agreement may be executed in any number of counterparts, each of which when
delivered shall be deemed to be an original and all of which together shall
constitute one and the same document.

    

    Signed by
the parties hereto as of the date referenced on the first page
hereof.

    

    Signature
Pages Follow

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

    

    
      
        
          
            
              
                
                  	
                          SIGNED,
      SEALED & DELIVERED

                        	 
      	 
      
	
                          in
      the presence of:

                        	 
      	 
      
	 
      	 
      	 
      
	
                            

                        	 
      	 
      
	
                          Signature

                        	 
      	 
      
	 
      	 
      	 
      
	
                            

                        	 
      	
                            

                        
	
                          Print
      Name

                        	 
      	
                            

                        
	 
      	 
      	
                            

                        
	
                            

                        	 
      	
                          GEORGE
      OTTEN

                        
	
                          Address

                        	 
      	 
      
	 
      	 
      	 
      
	
                            

                        	 
      	 
      
	
                          Occupation

                        	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	
                          SIGNED,
      SEALED & DELIVERED

                        	 
      	 
      
	
                          in
      the presence of:

                        	 
      	 
      
	 
      	 
      	 
      
	
                            

                        	 
      	 
      
	
                          Signature

                        	 
      	 
      
	 
      	 
      	
                            

                        
	
                            

                        	 
      	
                            

                        
	
                          Print
      Name

                        	 
      	
                            

                        
	 
      	 
      	
                          DELL
      BALFOUR

                        
	
                            

                        	 
      	 
      
	
                          Address

                        	 
      	 
      
	 
      	 
      	 
      
	
                            

                        	 
      	 
      
	
                          Occupation

                        	 
      	 
      

                

              

            

          

        

      

    

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    
      
        
          
            	
                    SIGNED,
      SEALED & DELIVERED

                  	 
      	
                      

                  
	
                    in
      the presence of:

                  	 
      	 
      
	 
      	 
      	 
      
	
                      

                  	 
      	 
      
	
                    Signature

                  	 
      	 
      
	 
      	 
      	 
      
	
                      

                  	 
      	
                      

                  
	
                    Print
      Name

                  	 
      	
                      

                  
	 
      	 
      	
                      

                  
	
                      

                  	 
      	
                    DOUGLAS
      MacNAUGHTON

                  
	
                    Address

                  	 
      	 
      
	 
      	 
      	 
      
	
                      

                  	 
      	 
      
	
                    Occupation

                  	 
      	 
      

          

        

      

    

    

    
      
        
          
            	 
      	 
      	 
      
	
                    SIGNED,
      SEALED & DELIVERED

                  	 
      	 
      
	
                    in
      the presence of:

                  	 
      	 
      
	 
      	 
      	 
      
	
                      

                  	 
      	 
      
	
                    Signature

                  	 
      	 
      
	 
      	 
      	
                      

                  
	
                      

                  	 
      	
                      

                  
	
                    Print
      Name

                  	 
      	
                      

                  
	 
      	 
      	
                    GEORGE
      D. OTTEN

                  
	
                      

                  	 
      	 
      
	
                    Address

                  	 
      	 
      
	 
      	 
      	 
      
	
                      

                  	 
      	 
      
	
                    Occupation

                  	 
      	 
      

          

        

      

    

     

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    

    
      
        
          
            	
                    SIGNED,
      SEALED & DELIVERED

                  	 
      	 
      
	
                    in
      the presence of:

                  	 
      	 
      
	 
      	 
      	 
      
	
                      

                  	 
      	 
      
	
                    Signature

                  	 
      	 
      
	 
      	 
      	 
      
	
                      

                  	 
      	
                      

                  
	
                    Print
      Name

                  	 
      	
                      

                  
	 
      	 
      	
                      

                  
	
                      

                  	 
      	
                    CHRISTOPHER
      D. OTTEN

                  
	
                    Address

                  	 
      	 
      
	 
      	 
      	 
      
	
                      

                  	 
      	 
      
	
                    Occupation

                  	 
      	 
      

          

        

      

    

    

    
      
        
          
            	 
      	 
      	 
      
	
                    SIGNED,
      SEALED & DELIVERED

                  	 
      	 
      
	
                    in
      the presence of:

                  	 
      	 
      
	 
      	 
      	 
      
	
                      

                  	 
      	 
      
	
                    Signature

                  	 
      	 
      
	 
      	 
      	
                      

                  
	
                      

                  	 
      	
                      

                  
	
                    Print
      Name

                  	 
      	
                      

                  
	 
      	 
      	
                    JOANNE
      OTTEN

                  
	
                      

                  	 
      	 
      
	
                    Address

                  	 
      	 
      
	 
      	 
      	 
      
	
                      

                  	 
      	 
      
	
                    Occupation

                  	 
      	 
      

          

        

      

    

    

    
      
        
          	
                  CENTRAL
      CITY CONSOLIDATED CORP.

                	 
      
	 
      	 
      
	 
      	 
      
	
                  Per:  

                	
                    

                	
                  c/s

                
	 
      	
                  Authorized
      Signatory

                	 
      

        

      

    

    

    
      
        	
                PIER
      MAC PETROLEUM INSTALLATION LTD.

              	 
      
	 
      	 
      
	 
      	 
      
	
                Per:

              	
                  

              	
                c/s

              
	 
      	
                Authorized
      Signatory

              	 
      

      

    

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    
      
        
          	
                  TAICAN
      ENTERPRISE CORP.

                	 
      
	 
      	 
      
	 
      	 
      
	
                  Per:

                	
                    

                	
                  c/s

                
	 
      	
                  Authorized
      Signatory

                	 
      

        

      

    

    

    
      
        
          	
                  WITS
      BASIN PRECIOUS MINERALS INC.

                	 
      
	 
      	 
      
	 
      	 
      
	
                  Per:

                	
                    

                	
                  c/s

                
	 
      	
                  Authorized
      Signatory

                	 
      

        

      

    

    

    
      
        	
                HUNTER
      BATES MINING CORPORATION

              	 
      
	 
      	 
      
	 
      	 
      
	
                Per:

              	
                  

              	
                c/s

              
	 
      	
                Authorized
      Signatory

              	 
      

      

    

     

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

    EXHIBIT
K

    

    ALLOCATION
SCHEDULE

    

    The
specific allocation of the Purchase Price shall be as set forth below (the
“Allocation Schedule”)
as to the cash component of the Purchase Price (being $6,750,000) and the stock
component of the Purchase Price (being 3,620,000 shares of unregistered and
restricted .01 par value common stock of Wits Basin Precious Minerals Inc. (the
“Shares”) for the purposes of the Asset Purchase Agreement.

    

    
      
        	
                Land:

              	
                $550,000
      and 300,000 shares

              
	 
      	 
      
	
                Buildings:

              	
                $1,200,000
      and 650 shares

              
	 
      	 
      
	
                Contract
      Rights:

              	
                Nil.

              
	 
      	 
      
	
                Water
      Rights:

              	
                Nil.

              
	 
      	 
      
	
                Equipment:

              	
                $82,250

              
	 
      	 
      
	
                Goodwill:

              	
                Nil.

              
	 
      	 
      
	
                Mining
      Claims:

              	
                $4,914,400
      and 2,670,000 shares

              
	 
      	 
      
	
                Mining
      Permits:

              	
                $3,350EXHIBIT
10.149

    

    Ferring
Pharmaceuticals, Inc.

    4
Gatehall Drive, 3rd
Floor

    Parsippany,
NJ  07054

     

    March 17,
2009                     

    

    Vyteris,
Inc.

    13-01
Pollit Drive

    Fair
Lawn, NJ   07410

    

    Ladies
and Gentlemen:

    

    Ferring Pharmaceuticals, Inc., a
Delaware corporation (“Ferring”), Vyteris,
Inc., a Delaware corporation (“Vyteris”), and
Vyteris, Inc., a Nevada corporation (“Parent”) hereby agree
as follows:

    

    1.           License
Agreement.   Reference is hereby made to the License and
Development Agreement dated as of September 27, 2004, as amended, between
Ferring and Vyteris (the “License
Agreement”).

     

    (a)           Attached
hereto as Schedule
1 is a draft of the calendar year 2009 “patch development budget”
provided by Vyteris to Ferring pursuant to Section 2.04 of the License Agreement
(the “2009 Patch
Development Budget”).  Promptly following the execution and
delivery of this letter agreement, Vyteris and Ferring shall agree upon a final
2009 Patch Development Budget.  The existing 50/50 sharing arrangement
with respect to annual development costs incurred to carry out the Development
Plan described in the License Agreement shall remain in
place.  However, solely with respect to up to $6,600,000 of the 2009
Patch Development Budget, Ferring agrees that, subject to adequate confirmation
and approval by Ferring, in its sole reasonable discretion, regarding the use of
such funds consistent with the Development Plan, Ferring shall pay half of such
budgeted amount ($3,300,000) in full first.  With respect to each such
payment made by Ferring with respect to calendar year 2009 (including, without
limitation, prior to the execution of this letter agreement) in excess of the
amounts due in accordance with the original 50/50 sharing arrangement (the
“Excess
Amounts”), Ferring shall be deemed to have paid such Excess Amounts on
account of and on behalf of Vyteris’s obligation under the existing 50/50
sharing arrangement; and such Excess Amounts shall be deemed loans by Ferring to
Vyteris (which loans Vyteris shall repay to Ferring (i) by making payment, on
account of and for the benefit of Ferring, of Ferring’s 50/50 sharing obligation
with respect to the second half of such $6,600,000 ($3,300,000) of such
Development Costs, but in any event, no later than December 31, 2009, or (ii) if
earlier, upon the termination of the License Agreement or the breach by Vyteris
or Parent of the License Agreement, the Supply Agreement (as defined below), the
Technical Agreement (as defined below), or any of the Transaction Documents (as
defined below).  In connection therewith, Vyteris shall invoice
Ferring on a semi-monthly basis based on actual costs incurred during the prior
semi-monthly period.  All such payments shall continue to be subject
to year-end reconciliation and the other provisions set forth in Section 2.04 of
the License Agreement.  With respect to any amounts in the final 2009
Development Patch Development Budget in excess of $6,600,000, such amounts shall
be paid after Ferring and Vyteris pay the amounts set forth in this paragraph
(and the original 50/50 sharing arrangement shall apply with respect
thereto).

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

     

    (b)           Section
5.05(b) of the License Agreement is hereby amended and restated to read in its
entirety as follows:

     

    “In each
subsequent twelve month period, the revenue share percentage that shall be paid
by Ferring to Vyteris shall be as follows:

     

    
      	
               
      

            	
              ·

            	
              5%
      of the first $100 million of Net Sales during such
  period;

            

    

     

    
      	
               
      

            	
              ·

            	
              6.5%
      of Net Sales between $100-200 million during such period;
    and

            

    

     

    
      	
               
      

            	
              ·

            	
              8%
      of Net Sales exceeding $200 million in each such
  period.”

            

    

     

    (c)           Except
as set forth above, the License Agreement shall remain in full force and
effect.

     

    2.           Supply
Agreement.  Reference is hereby made to the Supply Agreement
dated September 27, 2004, as amended, between Ferring and Vyteris the (“Supply Agreement”)
and the Technical Agreement entered into by and between Ferring and Vyteris in
connection with (the “Technical
Agreement”).

     

    (a)           The
following is hereby added as a new Section 8.5 of the Supply
Agreement:

     

    “At
Ferring's expense, Vyteris hereby agrees that it shall permit a Ferring
manufacturing/production employee or representative to be onsite at Vyteris’s
Fair Lawn, New Jersey facility during calendar year 2009, at such times as are
reasonably requested by Ferring, for observation and review purposes solely with
respect to activities related to Ferring.  With respect to such
observation and review, the provisions of Article 6 of this Agreement
(Confidentiality) shall apply.  During calendar years 2009 and 2010,
Ferring agrees that it shall not directly solicit for employment any employee of
Vyteris whom Ferring is first introduced to directly as a result of the exercise
by Ferring of such observation and review rights.”

     

    (b)           Except
as set forth above, the Supply Agreement and the Technical Agreement shall
remain in full force and effect.

     

    3.           PMK150.

     

    (a)           Attached
hereto as Schedule
2 is a description of machinery commonly referred to as PMK150 and used
by Vyteris in connection with its performance of its obligations pursuant to the
License Agreement and Supply Agreement (together with all replacement and spare
parts and accessories, the “PMK150”).  Vyteris
hereby represents and warrants to Ferring that there are no manufacturer or
other warranties in favor of Vyteris and/or its affiliates relating to the
PMK150.

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

     

    (b)           Vyteris
and Parent hereby, jointly and severally,  represent and warrant to
Ferring that (i) Vyteris owns all good and marketable right, title and interest
in and to the PMK150, free and clear of any and all liens, security interests,
pledges, attachments, mortgages, charges, claims, conditions or other similar
encumbrances or restrictions of any kind, including, without limitation, any
conditional sale agreement or other title retention agreement (collectively,
“Liens”),
except for the Lien in favor of Spencer Trask Specialty Group (“Spencer Trask”); and
upon execution and delivery of the Bill of Sale (as defined below), Ferring
shall acquire all absolute unconditional right, title and interest in and to the
Purchased Assets (as defined below), free and clear of all Liens (i.e., Spencer
Trask shall release its Lien); (ii) the PMK150 conforms to the specifications
set forth on Schedule
2 hereto and is in good working order and operating condition, free of
any material defects (latent and otherwise); (iii) the PMK150 complies in all
material respects with all applicable requirements of all applicable and
relevant occupational safety and health laws and the regulations promulgated
thereunder; and (iv) the PMK150 is located at the facilities of Vyteris located
at 13-01 Pollit Drive, Fair Lawn, New Jersey.

     

    (c)           Vyteris
and Parent hereby, jointly and severally, represent and warrant to Ferring that
(i) Vyteris is a wholly-owned subsidiary of Parent, that Parent is a
holding-company without operations other than as relate to its ownership of
Vyteris, and that Parent’s only asset is its capital stock of Vyteris; and (ii)
except as set forth on Schedule 3, there is
no actual or threatened claim, lawsuit, action or proceeding against or
involving Vyteris or Parent.

     

    (d)           Simultaneously
with the execution and delivery of this letter agreement, Vyteris and Ferring
shall enter into an Assignment and Bill of Sale in the form attached hereto as
Exhibit A (the
“Bill of Sale”)
pursuant to which Vyteris shall sell and assign to Ferring, and Ferring shall
purchase from Vyteris, the PMK150 and all related records, documentation and
warranties (collectively, the “Purchased Assets”),
free and clear of all Liens.  The Bill of Sale is hereby incorporated
by reference into this Agreement as if fully set forth herein.

     

    (i)           The
purchase price to be paid by Ferring to Vyteris for the Purchased Assets is One
Million Dollars ($1,000,000) (the “Purchase Price”) and
shall be paid by Ferring to Vyteris as follows:

     

    (a)           credit
for the principal amounts owed by Vyteris to Ferring pursuant to (i) the
Promissory Note dated July 8, 2008 made by Parent, as nominee and agent for
Vyteris, to Ferring in the original principal amount of $50,000 (the "$50,000 Note") (which
principal amount equals $50,000), and (ii) the Promissory Note dated December
15, 2008 made by Parent, as nominee and agent for Vyteris, to Ferring in the
original principal amount of $200,000 (the "$200,000 Note")
(which principal amount equals $200,000) are hereby credited in full against the
Purchase Price;

     

    (b)           Ferring
shall make a payment to Vyteris in the amount of $250,000 on the date hereof;
and

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

     

    (c)           On
April 30, 2009, Ferring shall make a payment to Vyteris in the amount of (i)
$500,000, less credit for (ii) interest payments owed by Vyteris to Ferring
pursuant to the (A) the $50,000 Note; (B) the $200,000 Note; and (C) the
Promissory Note dated July 8, 2008 made by Parent, as nominee and agent for
Vyteris, to Ferring in the original principal amount of $2,500,000 (the “$2,500,000
Note”).

     

    (ii)           The
parties hereby acknowledge and agree that the loans made by Ferring and
represented by the $50,000 Note, the $200,000 Note and the $2,500,000 Note were
each made by Ferring to Parent, as nominee and agent for Vyteris.  The
parties hereby acknowledge and agree that the Purchase Price constitutes the
Fair Market Value of the Purchased Assets.  As used in this letter
agreement, the “Fair Market Value” means the price determined by the parties to
be the price which a willing buyer would pay for assets in an arm’s length
transaction to a willing seller who is under no compulsion to sell such
assets.

     

    (iii)           The
Parties hereby acknowledge and agree that, in accordance with Section 4 of the
$2,500,000 Note, Ferring has elected to offset the principal amount due by
Ferring thereunder against the $2,500,000 payment due by Ferring pursuant to
Section 5.02(ii) of the License Agreement.

     

    (e)           Simultaneously
with the execution and delivery of this letter agreement, Vyteris and Ferring
shall enter into an Equipment Lease Agreement in the form attached hereto as
Exhibit B (the
“Equipment
Lease”) pursuant to which Ferring shall lease to Vyteris the Purchased
Assets.   As set forth in the Equipment Lease, in lieu of Vyteris
paying the lease payments to Ferring in cash, at Ferring’s option Ferring shall
receive a dollar-for-dollar credit against, at Ferring’s option, (i) the option
exercise price described below with respect to the PMK300, and/or (ii) amounts
due by Ferring to Vyteris pursuant to the License Agreement (e.g., milestone payments),
the Supply Agreement and/or any other agreement between the
parties.  The Equipment Lease is hereby incorporated by reference into
this Agreement as if fully set forth herein.  General terms shall
include, without limitation, lease payments of $1000 per month, a term of 10
years and covenants by Vyteris to maintain the Equipment in proper working
order.  Without otherwise limiting the provisions of the Section 6(b)
of the Equipment Lease, the insurance referred to in Section 6(b) of the
Equipment Lease shall include the insurance set forth on Schedule 3(a)
attached hereto.

     

    4.           PMK300.

     

    (a)           Attached
hereto as Schedule
4 is a description of a piece of machinery commonly referred to as PMK300
(together with all replacement and spare parts and accessories, the “PMK300”).  There
are no manufacturer and other warranties in favor of Vyteris and/or Parent
relating to the PMK300.

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    (b)           Vyteris
and Parent hereby, jointly and severally, represent and warrant to Ferring that
(i) Vyteris owns all good and marketable right, title and interest in and to the
PMK300, free and clear of any and all Liens; and upon consummation by Ferring of
the transactions contemplated by the Option (as defined below), Ferring shall
acquire all absolute unconditional right, title and interest in and to the
PMK300 Assets (as defined below), free and clear of all Liens; (ii) the PMK300
conforms to the specifications: set forth on Schedule 4 hereto and
is in good working order and operating condition, free of any material defects
(latent and otherwise); (iii) the PMK300 complies in all material respects with
all applicable requirements of all applicable and relevant occupational safety
and health laws and the regulations promulgated thereunder; and (iv) the PMK300
is located at the facilities of Herro Hoeflinger Harro Höfliger
Verpackungsmaschinen GmbH, Werk Satteldorf, Industriestraße 6, 74589 Satteldorf,
GERMANY.

     

    (c)           Vyteris
hereby grants to Ferring the right to purchase the PMK300 and all related
records, documentation and warranties (collectively, the “PMK300 Assets”), free
and clear of all Liens (the “Option”).   In
order to exercise the Option, Ferring shall notify Vyteris in writing, prior to
the expiration of the Option Period (as defined below), that Ferring desires to
exercise the Option, in which case the parties shall promptly negotiate and
enter into a purchase agreement and other related documents (including, without
limitation, transfer documents and a legal opinion in favor of Ferring) in
connection therewith.  As used herein, the “Option Period” means
the period of time beginning on the date of this letter agreement and ending on
the second anniversary of the letter agreement.

     

    (i)           The
option exercise price to be paid by Ferring to Vyteris shall be in an amount and
upon payment terms mutually agreed upon by the parties in good
faith.

     

    (ii)           Vyteris
hereby covenants and agrees that during the Option Period (and, if Ferring
exercises the Option, until such time as Ferring and Vyteris consummate the sale
by Vyteris to Ferring of the PMK300 Purchased Assets), the representations and
warranties set forth in paragraph 4(b) shall remain true and accurate in all
respects and Vyteris shall maintain the insurance listed on Schedule 5 attached
hereto.

     

    5.           Representations and
Warranties.  Vyteris and Parent, jointly and severally, hereby
represent and warrant to Ferring, and Ferring hereby represents and warrants to
Vyteris that:

     

    (a)           It
is duly and validly existing under the laws under which it was organized and is
qualified and in good standing in the State of New Jersey; except that, with
respect to Parent, Vyteris and Parent represent and warrant that Parent is not
in good standing in the State of New Jersey, that Parent is not “doing business”
in the State of New Jersey and that such failure of Parent to be in good
standing is not in violation or contrary to any law or regulation.  It has the
requisite power and authority to execute, deliver and perform this letter
agreement and all of the other documents and instruments executed and delivered
by it in accordance herewith (collectively with this letter agreement, the
“Transaction
Documents”).  It has obtained all necessary authorizations to
approve the execution, delivery and performance by it of each of the Transaction
Documents to which it is a party.  Each of the Transaction Documents
to which it is a party has been duly executed and delivered by it.

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    (b)           Each
of the Transaction Documents to which it is a party is its legal, valid and
binding obligation, enforceable against it in accordance with its
terms.  The execution, delivery and performance of each of the
Transaction Documents to which it is a party does not and will not, under any
circumstance whatsoever: (i) conflict with, constitute a default, or result in a
default or other breach of or under the certificate of incorporation or bylaws
of such party or any agreement to which such party is a party or by which it or
its assets is bound; (ii) permit any entity or individual to either terminate or
to accelerate any liability or other obligation, or to impose any penalty under
or to otherwise modify, or exercise rights under, or cancel or require any
notice under, or otherwise violate any  agreement to which such party
is a party or by which it or its assets is bound; or (iii) otherwise result in a
Lien, except for Liens in favor of Ferring as contemplated by the Transaction
Documents.

     

    (c)           No
governmental or other authorization, approval or other consent of any kind or
nature by or on behalf of such party is required arising out of or otherwise
relating to the execution, delivery or performance of the Transaction Documents
to which it is a party and such party is not prohibited by any law from
consummating the transactions contemplated by any of the Transaction Documents
to which it is a party.  No litigation or other proceeding is pending
against it that questions the validity of any of the Transaction Documents or
any transaction contemplated thereby.

     

    6.           Indemnification; Security
Interests; Subordination; Additional Agreements.

     

    (a)           Vyteris
and Parent, jointly and severally, hereby agree to indemnify and hold harmless
(and at the request of Ferring, defend) Ferring and its parent and other
affiliates and their respective successors and permitted assigns, and the
officers, directors, managers, employees, members, partners, stockholders,
agents and representatives of each of the foregoing (collectively, the “Buyer Indemnitees”),
from and against, and shall pay to the Buyer Indemnitees the amount of, any and
all liabilities, losses, damages, expenses (including, without limitation,
reasonable attorneys’ fees), causes of action, suits, claims or judgments
arising from, resulting from or based upon (i) any breach of or inaccuracy in
the representations and warranties of Vyteris and/or Parent contained in any of
the Transaction Documents, the License Agreement, the Supply Agreement and/or
the Technical Agreement, (ii) any breach of the covenants or agreements of
Vyteris and/or Parent contained in any of the Transaction Documents, the License
Agreement, the Supply Agreement and/or the Technical Agreement, or (iii) the
actual or alleged use, operation, delivery or transportation of the Purchased
Assets (and, if Ferring exercises, the Option, the PMK300 Assets) prior to the
sale and assignment thereof to Ferring pursuant to the Transaction Documents or
while Vyteris and/or Parent otherwise has possession or control
thereof.

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    (b)           To
secure the obligations of Vyteris pursuant to the existing and new agreements
between the parties, Vyteris shall grant to Ferring a security interest in all
of the assets of Vyteris (including, without limitation, the PMK300 machinery
and the Product (as defined in the License Agreement), work in process supplies,
inventories, machinery and equipment); provided, however, that with respect to
patent rights, such collateral shall only include the patents and patent
applications (i) referred to in the License Agreement, (ii) made, created,
developed or reduced to practice in connection with the License Agreement, and
(iii) any other patents and patent applications owned or controlled by Vyteris
and necessary, useful or desirable to Ferring’s manufacture, marketing, sale
testing, development or use of the Product, including, without limitation the
patents and patent applications listed on Schedule 6 attached
hereto, together with certain other assets, all as more fully described in the
Vyteris Security Agreement (as defined below).  In furtherance
thereof, simultaneously with the execution and delivery of this letter
agreement, Vyteris shall execute and delivery to Ferring a Security Agreement in
the form attached hereto as Exhibit C (the “Vyteris Security
Agreement”) and any other UCC-1 statements, collateral assignments of
patents and other documents reasonably requested by Ferring.  The
Vyteris Security Agreement is hereby incorporated by reference into this
Agreement as if fully set forth herein.   Additionally, Vyteris
shall, upon the request of Ferring at any time on the date hereof or thereafter,
take all steps that Ferring deems advisable or necessary in order for Ferring to
obtain and/or perfect its security interest (including, at the request of
Ferring, that Vyteris shall execute appropriate German security documents, move
the PMK300 machinery to the United States and/or obtain a legal opinion, from a
law firm and in form satisfactory to Ferring, with respect to such
perfection).  The German security documents shall substantially
conform to the draft security transfer agreement (Sicherungsübereignungsvertrag)
attached hereto as Exhibit G and shall
be executed by the parties (including Spencer Trask) within twenty (20) bank
working days from the execution and delivery of this Letter
Agreement.  The German security documents shall form an integral part
of the Vyteris Security Agreement and their content shall be incorporated in
full into the Vyteris Security Agreement by way of reference.  Vyteris
shall pay all costs and expenses incurred by Ferring in connection with
perfecting its security interest (including, without limitation, all costs and
expenses of German legal counsel).   The Vyteris Security
Agreement shall terminate on the Security Interest Termination Date (as defined
in the Vyteris Security Agreement).

     

    (c)           To
secure the obligations of Parent pursuant to the existing and new agreements
between the parties, Parent shall grant to Ferring a security interest in all of
the assets of Parent.  In furtherance thereof, simultaneously with the
execution and delivery of this letter agreement, Parent shall execute and
delivery to Ferring a Parent Security Agreement in the form attached hereto as
Exhibit D (the
“Parent Security
Agreement”) and any other UCC-1 statements and other documents reasonably
requested by Ferring.  The Parent Security Agreement is hereby
incorporated by reference into this Agreement as if fully set forth
herein.   Additionally, Parent shall, upon the request of Ferring
at any time on the date hereof or thereafter, take all steps that Ferring deems
advisable or necessary in order for Ferring to obtain and/or perfect its
security interest.  Parent and/or Vyteris shall pay all costs and
expenses incurred by Ferring in connection with perfecting its security
interest.  The Parent Security interest shall terminate on the
Security Interest Termination Date.

     

    (d)           Simultaneously
with the execution and delivery of this letter agreement, Spencer Trask shall
fully release and discharge all Liens with respect to the PMK150, and (ii) enter
into a Subordination and Agreement in the form attached hereto as Exhibit
E.  Additionally, immediately prior to consummation of the
transactions contemplated by exercise by Ferring of the Option, Spencer Trask
shall fully release and discharge all Liens with respect to the
PMK300.  In connection with the foregoing, Spencer Trask hereby shall
authorize Ferring to take any and all actions (including, as appropriate, filing
UCC-3 termination statements) necessary or desirable, as determined by Ferring
in good faith.

     

    (e)           Simultaneously
with the execution and delivery by the parties of this letter agreement, Vyteris
shall deliver to Ferring the legal opinion of Jolie Kahn, Esq., counsel to
Vyteris, in form and substance satisfactory to Ferring, in the form attached
hereto as Exhibit
F.

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    (f)           Until
the Security Interest Termination Date, Vyteris nor Parent may not make any
payments to any related party shareholders or entities controlled by related
party shareholders (“related party shareholder” is defined as those shareholders
listed on Schedule
8 attached hereto), except for (i) compensation under existing employment
agreements and consulting fees payable to officers and a certain corporate
director at rates no greater than the rates in effect on January 1, 2009 and
otherwise upon terms no more favorable to such officers and director than under
past practices, and compensation paid to Parent’s Board of Directors pursuant to
arrangements in effect either pursuant to the existing Board compensation plan
or otherwise as in effect on January 1, 2009, and (ii) amounts pre-approved by
Ferring in writing, in each instance, in Ferring’s sole discretion.

     

    (g)           
Notwithstanding anything contained in the Vyteris Security Agreement to the
contrary, Ferring hereby agrees that if, and only if, (i) Ferring has confirmed
in writing that neither Vyteris nor Parent has breached or defaulted under or
with respect to (nor has Ferring alleged in good faith that such breach or
default has occurred under or with respect to) any of the Transaction Documents,
the License Agreement, the Supply Agreement and/or the Technical Agreement, and
(ii) Spencer Trask has reaffirmed in writing (in form and substance reasonably
satisfactory to Ferring in its sole discretion) that the Subordination and
Agreement remains in full force and effect, Ferring shall (A) allow Vyteris to
grant or allow the imposition of a lien or security interest upon the Collateral
(as defined in the Vyteris Security Agreement) in connection with the making of
loans to Vyteris by one or more New Third Party Lenders, and (B) subordinate its
liens and security interests created by the Vyteris Security Agreement to such
New Third Party Lenders to the extent that the value of the Collateral (as
defined in the Vyteris Security Agreement) at the time or times that Ferring
exercises its rights and remedies pursuant to the Vyteris Security Agreement (as
determined by Ferring in its sole discretion good faith) exceeds $3,300,000; it
being understood and agreed that Ferring’s liens and security interests shall
remain senior to the New Third Party Lenders with respect to at least $3,300,000
of value of the Collateral.  In connection with the foregoing
subordination, Ferring agrees to execute a subordination agreement with New
Third Party Lenders in form and substance reasonably satisfactory to Ferring in
its sole discretion.  As used herein, a “New Third Party
Lender” means a third party accredited investor and/or financial
institution (but not Spencer Trask) that is not affiliated in any way with
Vyteris, Parent, Spencer Trask or any related party shareholders or entities
controlled by related party shareholders (as described in paragraph 6(f)
above).

     

    (h)           So
long the License Agreement and/or the Supply Agreement is in effect, Ferring
shall receive notice of all regularly scheduled and unscheduled meetings of the
Board of Directors of Vyteris and Parent, and subject to having designated an
observer (which may be only one person and not subject to change unless the
designated person is no longer employed or retained by Ferring), who has signed
Vyteris’s and Parent's standard nondisclosure agreement (of which Ferring shall
not be a third party beneficiary), such observer may attend Vyteris’s and
Parent's regularly scheduled and unscheduled meetings of its Board of Directors
and shall receive the materials distributed or made available to the voting
members of the Board in connection with such meetings; provided, however, that
such observer shall not have a right to vote or otherwise pass on any matters
brought to the attention of the Board at such meetings, and such observer shall
be excluded from any discussions regarding any matters related to
Ferring.

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    7.           Miscellaneous.

     

    (a)           Each
of the Transaction Documents shall be governed by and construed in accordance
with the laws of the State of New Jersey without giving effect to conflicts of
law principles.

     

    (b)           Each
of the Transaction Documents may be executed in counterparts and delivered by
facsimile, each of which shall be deemed an original, but all of which together
shall constitute one and the same instrument.  The parties hereby
submit to the exclusive jurisdiction of the state and federal courts located in
the City of Newark, State of New Jersey for the sole purpose of the Transaction
Documents and any controversy arising thereunder. VYTERIS AND FERRING EACH WAIVE
THEIR RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION ARISING FROM THE
TRANSACTION DOCUMENTS.

     

    (c)           Vyteris
and Parent shall execute and deliver to Ferring, upon Ferring’s request, such
instruments and assurances as Ferring deems necessary or advisable in order to
consummate the transactions contemplated by the Transaction
Documents.  At request of Ferring, Vyteris shall execute, or join
Ferring in executing, financing statements pursuant to the Uniform Commercial
Code or comparable statute, rule or regulation.

     

    (d)           All
notices under any of the Transaction Documents shall be delivered by facsimile
(confirmed by overnight delivery) or by overnight delivery with a reputable
overnight delivery service, to the address of the respective parties set forth
above.  Notices shall be effective on the day following the date of
transmission if sent by facsimile, and on the business day following the date of
delivery to the overnight delivery service if sent by overnight
delivery.  A party may change its address listed above by notice to
the other party given in accordance with this section.

     

    (e)           The
parties hereto acknowledge that the Transaction Documents set forth the entire
agreement and understanding of the parties and supersedes all prior written or
oral agreements or understandings with respect to the subject matter
thereof.  No modification of any of the terms of any of the
Transaction Documents shall be deemed to be valid unless in writing and signed
by an authorized agent or representative of both parties hereto.  No
course of dealing or usage of trade shall be used to modify the terms and
conditions therein.  A waiver of a default shall not be a waiver of
any other or a subsequent default.

     

    (f)           Each
of the Transaction Documents is binding upon, and inures to the benefit of, the
parties hereto and their respective administrators, successors and
assigns.  Neither Vyteris nor Parent may assign or otherwise transfer
(by assignment, stock sale, merger or otherwise) any of the Transaction
Documents without the prior written consent of Ferring.  Each
provision of each of the Transaction Documents shall be considered separable;
and if, for any reason, any provision or provisions herein are determined to be
invalid and contrary to any existing or future law, such invalidity shall not
impair the operation of or affect those portions of the applicable Transaction
Documents which are valid.

     

    [Signature
Page Follows]

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

    Please
confirm your agreement to the foregoing by executing the enclosed duplicate
original of this letter in the space provided below and returning it to
Ferring.

     

    
      
        	
                FERRING
      PHARMACEUTICALS, INC.

              
	 
      
	
                By:

              	 
      
	
                   

              
	 
      	
                Name:

              
	 
      	
                Title:

              

      

    

    

    
      
        	
                ACCEPTED
      AND

              
	
                AGREED
      TO:

              
	 
      
	
                VYTERIS,
      INC., a Delaware corporation

              
	 
      	 
      
	
                By:

              	
                   

              
	 
      	
                Name:

              
	 
      	
                Title:

              
	 
      
	
                ACCEPTED
      AND AGREED TO:

              
	 
      
	
                VYTERIS,
      INC., a Nevada corporation

              
	 
      
	
                By:

              	
                   

              
	 
      	
                Name:

              
	 
      	
                Title:

              

      

    

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    SCHEDULES AND
EXHIBITS

     

    

      
        
          
            
              	
                      Schedule
      1

                    	
                      2009
      Patch Development Budget

                    
	
                      Schedule
      2

                    	
                      Description
      of PMK150

                    
	
                      Schedule
      3

                    	
                      Claims,
      Lawsuits, Actions

                    
	
                      Schedule
      3(a)

                    	
                      PMK150
      Insurance

                    
	
                      Schedule
      4

                    	
                      Description
      of PMK300

                    
	
                      Schedule
      5

                    	
                      PMK300
      Insurance

                    
	
                      Schedule
      6

                    	
                      Certain
      Patent Rights

                    
	
                      Schedule
      7

                    	
                      Materials
      and Supplies

                    
	
                      Schedule
      8

                    	
                      Related
      Parties

                    
	 
      	 
      
	
                      Exhibit
      A

                    	
                      Form
      of Bill of Sale

                    
	
                      Exhibit
      B

                    	
                      Form
      of Equipment Lease

                    
	
                      Exhibit
      C

                    	
                      Form
      of Vyteris Security Agreement

                    
	
                      Exhibit
      D

                    	
                      Form
      of Parent Security Agreement

                    
	
                      Exhibit
      E

                    	
                      Form
      of Subordination of Agreement

                    
	
                      Exhibit
      F

                    	
                      Form
      of Legal Opinion

                    
	
                      Exhibit
      G

                    	
                      Draft
      German Security Transfer
Agreement

                    

            

          

        

      

      
        
           

        

        
          11

          
            

          

        

        
           

        

      

    

    Schedule
1           Draft 2009 Patch Development Budget

    

    See
Attached

    

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

    Schedule
2           Description of PMK150

    

    See
attached

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

    

    Schedule
3           Claims, Lawsuits, Actions

    

    See
Attached

    
      
         

      

      
        14

        
          

        

      

      
         

      

    

    Schedule
3(a)    PMK150 Insurance

    

    See
Attached

    

    
      
         

      

      
        15

        
          

        

      

      
         

      

    

    Schedule
4           Description of PMK300

    

    See
Attached

    

    
      
         

      

      
        16

        
          

        

      

      
         

      

    

    Schedule
5           PMK300 Insurance

    

    See
Attached

    
      
         

      

      
        17

        
          

        

      

      
         

      

    

    Schedule
6           Certain Patent Rights

    

    See
Attached

    

    
      
         

      

      
        18

        
          

        

      

      
         

      

    

    Schedule
7           Materials and Supplies

    

    See
Attached

    

    
      
         

      

      
        19

        
          

        

      

      
         

      

    

    Schedule
8           Related Parties

    

    See
Attached

    
      
         

      

      
        20

        
          

        

      

      
         

      

    

    

    Exhibit
A           Form of Bill of Sale

    

    See
Attached

    

    
      
         

      

      
        21

        
          

        

      

      
         

      

    

    Exhibit
B           Form of Equipment Lease

    

    See
Attached

    

    
      
         

      

      
        22

        
          

        

      

      
         

      

    

    Exhibit
C           Form of Vyteris Security Agreement

    

    See
Attached

    

    
      
         

      

      
        23

        
          

        

      

      
         

      

    

    Exhibit
D           Form of Parent Security Agreement

    

    See
Attached

    
      
         

      

      
        24

        
          

        

      

      
         

      

    

    Exhibit
E           Form of Subordination and Agreement

    

    See
Attached

    
      
         

      

      
        25

        
          

        

      

      
         

      

    

    

    Exhibit
F           Form of Legal Opinion

    

    See
Attached

     

    
      
         

      

      
        26

        
          

        

      

      
         

      

    

    
Exhibit
G           Draft German Security Transfer
Agreement

    

    See
Attached (to be
finalized post-Closing)

    
      
         

      

      
        27

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