Document:

Unassociated Document

    Desert
Hawk Gold Corp.

    

    2008  STOCK  OPTION/STOCK  ISSUANCE  PLAN

    (As
Adopted by the Board of Directors on July 12, 2008,

    and by
the Shareholders on August 5, 2008)

    (As
Amended by the Board of Directors and

    the
Shareholders on February 28, 2010)

    

    
      	
              I.

            	
              GENERAL
      PROVISIONS

            

    

    

    
      	
               
      

            	
              A.

            	
              Purpose
      of the Plan

            

    

    

    This 2008
Stock Option/Stock Issuance Plan (the “Plan”) is intended to aid the Corporation
(or any Parent or Subsidiary) in maintaining and developing a management team,
attracting qualified officers and Employees capable of assisting in the future
success of the Corporation, and rewarding those individuals who have
contributed, or may contribute in the future, to the success of the Corporation
(or any Parent or Subsidiary).  It is designed to aid the Corporation
(and any Parent or Subsidiary) in retaining the services of executives and
Employees and in attracting new personnel when needed for future operations and
growth and to provide such personnel with an incentive to remain Employees of
the Corporation, to use their best efforts to promote the success of the
Corporation’s business, and to provide them with an opportunity to obtain or
increase a proprietary interest in the Corporation.  It is further
designed to attract and retain the best available personnel for service as
directors of the Corporation (or any Parent or Subsidiary), whether or not such
individuals may otherwise be Employees.  It is also designed to permit
the Corporation to reward those consultants or other independent advisors who
are not Employees but who are perceived by management as having contributed to
the success of the Corporation (or any Parent or Subsidiary) or who are
important to the continued business and operations of the Corporation (or any
Parent or Subsidiary).

    

    Capitalized
terms herein shall have the meanings assigned to such terms in the attached
Appendix.

    

    
      	
               
      

            	
              B.

            	
              Structure
      of the Plan

            

    

    

    
      	
               
      

            	
              1.

            	
              The
      Plan shall be divided into two (2) separate equity
    programs:

            

    

    

    
      	
               
      

            	
              a.

            	
              the
      Option Grant Program under which eligible persons may, at the discretion
      of the Plan Administrator, be granted options to purchase shares of Common
      Stock, and

            

    

    

    
      	
               
      

            	
              b.

            	
              the
      Stock Issuance Program under which eligible persons may, at the discretion
      of the Plan Administrator, be issued shares of Common Stock directly,
      either through the immediate purchase of such shares or as a bonus for
      services rendered to the Corporation (or any Parent or Subsidiary) or as
      an incentive to perform services for the Corporation (or any Parent or
      Subsidiary).

            

    

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              2.

            	
              The
      provisions of Sections I and IV shall apply to both equity programs under
      the Plan and shall accordingly govern the interests of all persons under
      the Plan.

            

    

    

    
      	
               
      

            	
              C.

            	
              Administration
      of the Plan

            

    

    

    
      	
               
      

            	
              1.

            	
              The
      Plan shall be administered by the Board.  However, any or all
      administrative functions otherwise exercisable by the Board may be
      delegated to the Committee.  Members of the Committee shall
      serve for such period of time as the Board may determine and shall be
      subject to removal by the Board at any time.  The Board may also
      at any time terminate the functions of the Committee and reassume all
      powers and authority previously delegated to the
  Committee.

            

    

    

    
      	
               
      

            	
              2.

            	
              The
      Plan Administrator shall have full power and authority (subject to the
      provisions of the Plan) to establish such rules and regulations as it may
      deem appropriate for proper administration of the Plan and to make such
      determinations under, and issue such interpretations of, the Plan and any
      outstanding options thereunder as it may deem necessary or
      advisable.  Decisions of the Plan Administrator shall be final
      and binding on all parties who have an interest in the Plan or any option
      thereunder.

            

    

    

    
      	
               
      

            	
              D.

            	
              Eligibility

            

    

    

    
      	
               
      

            	
              1.

            	
              The
      persons eligible to participate in the Plan are as
      follows:  Employees; non-employee members of the Board or
      non-employee members of the board of directors of any Subsidiary; officers
      of the Corporation or any Subsidiary; and consultants and other
      independent advisors who provide a Service.  Options granted, or
      shares issued, to consultants or other independent advisors shall be made
      only to individuals who are natural persons (unless waived by the Plan
      Administrator) and who provide a bona fide Service, provided that the
      Service is not in connection with the offer or sale of securities in a
      capital-raising transaction, and does not directly or indirectly promote
      or maintain a market for the Corporation’s
  securities.

            

    

    

    
      	
            	
              
                2.

              

            	
              The
      Plan Administrator shall have full authority to determine, (i) with
      respect to the option grants under the Option Grant Program, which
      eligible persons are to receive option grants, the time or times when such
      option grants are to be made, the number of shares to be covered by each
      such grant, the status of the granted option as either an Incentive Option
      or a Non-Statutory Option, the time or times at which each option is to
      become exercisable, the vesting schedule (if any) applicable to the option
      shares and the maximum term for which the option is to remain outstanding,
      and (ii) with respect to stock issuances under the Stock Issuance Program,
      which eligible persons are to receive stock issuances, the time or times
      when such issuances are to be made, the number of shares to be issued to
      each Participant, the vesting schedule (if any) applicable to the issued
      shares and the consideration to be paid or given by the Participant for
      such shares.

            

    

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              3.

            	
              The
      Plan Administrator shall have the absolute discretion either to grant
      options in accordance with the Option Grant Program or to effect stock
      issuances in accordance with the Stock Issuance
  Program.

            

    

    

    
      	
               
      

            	
              E.

            	
              Stock
      Subject to the Plan

            

    

    

    
      	
               
      

            	
              1.

            	
              The
      stock issuable under the Plan shall be shares of authorized but unissued
      or reacquired Common Stock.  The maximum number of shares of
      Common Stock which may be issued over the term of the Plan shall not
      exceed 3,000,000 shares.

            

    

    

    
      	
               
      

            	
              2.

            	
              Shares
      of Common Stock subject to outstanding options shall be available for
      subsequent issuance under the Plan to the extent (i) the options expire or
      terminate for any reason prior to exercise in full or (ii) the
      options are canceled in accordance with the cancellation-re-grant
      provisions of Section II(E).

            

    

    

    
      	
               
      

            	
              3.

            	
              Should
      any change be made to the Common Stock by reason of any stock split, stock
      dividend, recapitalization, combination of shares, exchange of shares or
      other change affecting the outstanding Common Stock as a class without the
      Corporation’s receipt of consideration, appropriate adjustments shall be
      made to the maximum number and/or class of securities issuable under the
      Plan.  The adjustments determined by the Plan Administrator
      shall be final, binding and
conclusive.

            

    

    

    
      	
              II.

            	
              OPTION GRANT
      PROGRAM

            

    

    

    
      	
               
      

            	
              A.

            	
              Types
      of Options

            

    

    

    The
Option Grant Program shall be comprised of two types of options as
follows:

    

    
      	
               
      

            	
              1.

            	
              Incentive
      Options which are options intended to qualify under the Code, subject to
      limiting conditions, for favorable tax treatment in respect of the
      recognition of ordinary income, gain, or loss and withholding requirements
      applicable to the exercise of the options and disposition of the shares of
      Common Stock acquired upon exercise of Incentive
  Options.

            

    

    

    
      
        
           

        

        
          3

          
            

          

        

        
           

        

      

    

    

    
      	
               
      

            	
              2.

            	
              Non-Statutory
      Options which are those options that are not intended to qualify under the
      Code for favorable tax treatment in respect of the recognition of ordinary
      income, gain, or loss and withholding requirements applicable to the
      exercise of options and disposition of shares of Common Stock acquired
      pursuant to the exercise of the Non-Statutory options.  The
      Option Grant Program intends that the treatment of such transactions in
      respect of Non-Statutory Options will be governed by the taxation rules
      applicable to the transfer of property in connection with the performance
      of services.

            

    

    

    
      	
               
      

            	
              B.

            	
              Option
      Terms Applicable to Both Incentive and Non-Statutory
    Options

            

    

    

    
      	
               
      

            	
              1.

            	
              Option
      Agreements.

            

    

    

    Each
option shall be evidenced by one or more option agreements between the
Corporation and the Optionee.  Option agreements shall designate the
number of shares and the exercise price of the Option to which it pertains, and
shall set forth the vesting schedule of the Option or state that the Option is
vested immediately.  The option agreements shall be in writing, dated
as of the date the option is granted, and shall be executed on behalf of the
Corporation by such officers as the Board shall authorize.  Option
agreements shall be in such form and contain such additional provisions as the
Plan Administrator shall prescribe, but in no event shall they contain
provisions inconsistent with the provisions of this Plan.

    

    
      	
               
      

            	
              2.

            	
              Exercise
      Price.

            

    

    

    
      	
               
      

            	
              a.

            	
              The
      exercise price per share shall be fixed by the Plan Administrator for
      Incentive and Non-Statutory Options as set forth
  below.

            

    

    

    
      	
               
      

            	
              b.

            	
              The
      exercise price shall become immediately due upon exercise of the option
      and shall, subject to the provisions of Section IV(A) and the documents
      evidencing the option, be payable in cash or check made payable to the
      Corporation.  The Plan Administrator, in its discretion, may
      also permit the exercise price to be paid partly in cash and/or as
      follows:

            

    

    

    
      	
               
      

            	
              (1)

            	
              in
      shares of Common Stock valued at Fair Market Value on the Exercise
      Date;

            

    

    

    
      	
            	
              
                (2)

              

            	
              to
      the extent the option is exercised for vested shares, through a special
      sale and remittance procedure pursuant to which the Optionee shall
      concurrently provide irrevocable written instructions (A) to a
      Corporation-designated brokerage firm to effect the immediate sale of the
      purchased shares and remit to the Corporation, out of the sale proceeds
      available on the settlement date, sufficient funds to cover the aggregate
      exercise price payable for the purchased shares plus all applicable
      Federal, state and local income and employment taxes required to be
      withheld by the Corporation by reason of such exercise, and (B) to the
      Corporation to deliver the certificates for the purchased shares directly
      to such brokerage firm in order to complete the
  sale;

            

    

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (3)

            	
              with
      options granted  hereby valued at the amount by which the Fair
      Market Value of the Common Stock subject to these options exceeds the
      exercise or purchase price provided on such options; provided that options
      used to satisfy the exercise price shall be surrendered to and cancelled
      by the Corporation;

            

    

    

    
      	
               
      

            	
              (4)

            	
              by
      cancellation of debt owed by the Corporation to the Optionee, including
      debt incurred for professional services rendered, employment
      relationships, or otherwise, upon presentation of an invoice for services
      provided to the Corporation; or

            

    

    

    
      	
               
      

            	
              (5)

            	
              by
      means of an early exercise program adopted by the Plan Administrator
      permitting exercise of options prior to
vesting.

            

    

    

    
      	
               
      

            	
              c.

            	
              Except
      to the extent such sale and remittance procedure is utilized, payment of
      the exercise price for the purchased shares must be made on the Exercise
      Date.

            

    

    

    
      	
               
      

            	
              3.

            	
              Exercise and Term of
      Options.

            

    

    

     Each
option shall be exercisable at such time or times, during such period and for
such number of shares as shall be determined by the Plan Administrator and set
forth in the documents evidencing the option grant.  However, no
option shall have a term in excess of ten (10) years measured from the option
grant date.  The terms of Incentive and Non-Qualified Options shall be
fixed by the Plan Administrator within the limits specified below.

    

    
      	
               
      

            	
              4.

            	
              Effect of Termination
      of Service.

            

    

    

    
      	
               
      

            	
              a.

            	
              The
      following provisions shall govern the exercise of any options held by the
      Optionee at the time of cessation of Service or
  death:

            

    

    

    
      
        
           

        

        
          5

          
            

          

        

        
           

        

      

    

    

    
      	
               
      

            	
              (1)

            	
              Should
      the Optionee cease to remain in Service for Misconduct, then the options
      shall terminate on the date of cessation of the
  Service.

            

    

    

    
      	
               
      

            	
              (2)

            	
              Should
      the Optionee cease to remain in Service for any reason other than
      Misconduct, Disability or death, then the Optionee shall have a period of
      three (3) months following the date of such cessation of Service during
      which to exercise each outstanding option held by such
      Optionee.

            

    

    

    
      	
               
      

            	
              (3)

            	
              Should
      Optionee’s Service terminate by reason of Disability, then the Optionee
      shall have a period of twelve (12) months following the date of such
      cessation of Service during which to exercise each outstanding option held
      by such Optionee.

            

    

    

    
      	
               
      

            	
              (4)

            	
              If
      the Optionee dies while holding an outstanding option, then the personal
      representative of his or her estate or the person or persons to whom the
      option is transferred pursuant to the Optionee’s will or the laws of
      inheritance shall have a twelve (12) month period following the date of
      the Optionee’s death to exercise such
option.

            

    

    

    
      	
               
      

            	
              (5)

            	
              Under
      no circumstances, however, shall any such option be exercisable after the
      specified expiration of the option
term.

            

    

    

    
      	
               
      

            	
              (6)

            	
              During
      the applicable post-Service exercise period, the option may not be
      exercised in the aggregate for more than the number of vested shares for
      which the option is exercisable on the date of the Optionee’s cessation of
      Service.  Upon the expiration of the applicable exercise period
      or (if earlier) upon the expiration of the option term, the option shall
      terminate and cease to be outstanding for any vested shares for which the
      option has not been exercised.  However, the option shall,
      immediately upon the Optionee’s cessation of Service, terminate and cease
      to be outstanding with respect to any and all option shares for which the
      option is not otherwise at the time exercisable or in which the Optionee
      is not otherwise at that time
vested.

            

    

    

    
      	
               
      

            	
              b.

            	
              The
      Plan Administrator shall have the discretion, exercisable either at the
      time an option is granted or at any time while the option remains
      outstanding, to:

            

    

    

    
      	
            	
              
                (1)

              

            	
              extend
      the period of time for which the option is to remain exercisable following
      Optionee’s cessation of Service or death from the limited period otherwise
      in effect for that option to such greater period of time as the Plan
      Administrator shall deem appropriate, but in no event beyond the
      expiration of the option term;
and/or

            

    

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    

    
      	
               
      

            	
              (2)

            	
              permit
      the option to be exercised, during the applicable post-Service exercise
      period, not only with respect to the number of vested shares of Common
      Stock for which such option is exercisable at the time of the Optionee’s
      cessation of Service but also with respect to one or more additional
      installments in which the Optionee would have vested under the option had
      the Optionee continued in Service.

            

    

    

    
      	
               
      

            	
              5.

            	
              Shareholder
      Rights.  The holder of an option shall have no
      shareholder rights with respect to the shares subject to the option until
      such person shall have exercised the option, paid the exercise price, and
      become a holder of record of the purchased
  shares.

            

    

    

    
      	
               
      

            	
              6.

            	
              [RESERVED]

            

    

    

    
      	
               
      

            	
              7.

            	
              Limited
      Transferability of Options.  During the lifetime of the
      Optionee, the option shall be exercisable only by the Optionee and shall
      not be assignable or transferable other than by will or by the laws of
      descent and distribution following the Optionee’s
  death.

            

    

    

    
      	
               
      

            	
              8.

            	
              Withholding.  The
      Corporation’s obligation to deliver shares of Common Stock upon the
      exercise of any options granted under the Plan shall be subject to the
      satisfaction of all applicable Federal, state and local income and
      employment tax withholding
requirements.

            

    

    

    
      	
               
      

            	
              C.

            	
              Incentive
      Options

            

    

    

    The terms
specified below shall be applicable to all Incentive Options.  Except
as modified by the provisions of this Section II(C), all the provisions of the
Plan shall be applicable to Incentive Options.  Options which are
specifically designated as Non-Statutory Options shall not be subject to the
terms of this Section II (C).

    

    
      	
               
      

            	
              1.

            	
              Eligibility.  Incentive
      Options may only be granted to
Employees.

            

    

    

    
      	
               
      

            	
              2.

            	
              Exercise
      Price.  The exercise price per share shall not be less
      than one hundred percent (100%) of the Fair Market Value per share of
      Common Stock on the option grant date.  For options granted to a
      10% Shareholder, the exercise price per share shall not be less than one
      hundred ten percent (110%) of the Fair Market Value per share of Common
      Stock on the option grant date.

            

    

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    
 

    
      	
               
      

            	
              3.

            	
              Dollar
      Limitation.  The aggregate Fair Market Value of the
      shares of Common Stock (determined as of the respective date or dates of
      grant) for which one or more options granted to any Employee under the
      Plan (or any other option plan of the Corporation or any Parent or
      Subsidiary) may for the first time become exercisable as Incentive Options
      during any one (1) calendar year shall not exceed the sum of One Hundred
      Thousand Dollars ($100,000).  To the extent the Employee holds
      two (2) or more such options which become exercisable for the first time
      in the same calendar year, the foregoing limitation on the exercisability
      of such options as Incentive Options shall be applied on the basis of the
      order in which such options are
granted.

            

    

    

    
      	
               
      

            	
              4.

            	
              Option
      Term for 10% Shareholder.  If any Employee
      to whom an Incentive Option is granted is a 10% Shareholder, then the
      option term shall not exceed five (5) years measured from the option grant
      date.

            

    

    

    
      	
               
      

            	
              D.

            	
              Non-Statutory
      Options

            

    

    

    The terms
specified below shall be applicable to all Non-Statutory
Options.  Except as modified by the provisions of this Section II(D),
all the provisions of the Plan shall be applicable to Non-Statutory
Options.

    

    
      	
               
      

            	
              1.

            	
              Eligibility.  Non-Statutory
      Options may be granted to the following
persons:

            

    

    

    
      	
               
      

            	
              a.

            	
              Employees,

            

    

    

    
      	
               
      

            	
              b.

            	
              non-employee
      members of the Board or the non-employee members of the board of directors
      of any Parent or Subsidiary, and

            

    

    

    
      	
               
      

            	
              c.

            	
              consultants
      and other independent advisors who provide services to the Corporation (or
      any Parent or Subsidiary), provided that such consultants or advisors are
      natural persons; that they provide bona fide services to the Corporation
      (or the Parent or Subsidiary); and that the services are not in connection
      with the offer or sale of securities in a capital-raising transaction, and
      do not directly or indirectly promote or maintain a market for the
      Corporation’s securities.

            

    

    

    
      	
               
      

            	
              2.

            	
              Exercise
      Price.  The exercise price per share covered by a
      Non-Statutory Option shall not be less than eighty-five percent (85%) of
      the Fair Market Value per share of Common Stock on the option grant
      date.

            

    

    

    
      
        
           

        

        
          8

          
            

          

        

        
           

        

      

    

    

    
      	
               
      

            	
              E.

            	
              Corporate
      Transaction

            

    

    

    
      	
               
      

            	
              1.

            	
              The
      Plan and each option outstanding under the Plan at the time of a Corporate
      Transaction shall terminate and cease to be outstanding, but only after
      each Optionee (or the successor in interest) has been given, for the
      period of ten (10) days ending five (5) days before the effective date of
      the Corporate Transaction (or such longer period as the Board may
      specify), the right to exercise any unexpired option in full or in part,
      as if such option was fully vested and exercisable notwithstanding
      anything to the contrary contained in any option agreement between the
      Corporation and any optionee.  However, the outstanding options
      shall not terminate and cease to be outstanding on such an accelerated
      basis if and to the extent such options are assumed by the successor
      corporation (or parent thereof) in the Corporate
    Transaction.

            

    

    

    
      	
               
      

            	
              2.

            	
              Each
      option which is assumed in connection with a Corporate Transaction shall
      be appropriately adjusted, immediately after such Corporate Transaction,
      to apply to the number and class of securities which would have been
      issuable to the Optionee in consummation of such Corporate Transaction,
      had the option been exercised immediately prior to such Corporate
      Transaction.  Appropriate adjustments shall also be made to (i)
      the number and class of securities available for issuance under the Plan
      following the consummation of such Corporate Transaction and (ii) the
      exercise price payable per share under each outstanding option, provided
      the aggregate exercise price payable for such securities shall remain the
      same.

            

    

    

    
      	
               
      

            	
              3.

            	
              The
      Plan Administrator shall have the discretion, exercisable either at the
      time the option is granted or at any time while the option remains
      outstanding, to provide for the automatic acceleration (in whole or in
      part) of one or more outstanding options upon the occurrence of a
      Corporate Transaction, whether or not those options are to be assumed or
      replaced in the Corporate
Transaction.

            

    

    

    
      	
               
      

            	
              4.

            	
              The
      portion of any Incentive Option accelerated in connection with a Corporate
      Transaction shall remain exercisable as an Incentive Option only to the
      extent the applicable One Hundred Thousand Dollar ($100,000) limitation is
      not exceeded.  To the extent such dollar limitation is exceeded,
      the accelerated portion of such option shall be exercisable as a
      Non-Statutory Option under the Federal tax
laws.

            

    

    

    
      	
               
      

            	
              5.

            	
              Subject
      to Section II(F) below, the grant of options under the Plan shall in no
      way affect the right of the Corporation to adjust, reclassify, reorganize
      or otherwise change its capital or business structure or to merge,
      consolidate, dissolve, liquidate or sell or transfer all or any part of
      its business or assets.

            

    

    

    
      
        
           

        

        
          9

          
            

          

        

        
           

        

      

    

    

    
      	
               
      

            	
              F.

            	
              Adjustments

            

    

    

    
      	
               
      

            	
              1.

            	
              If
      the Corporation shall at any time subdivide its outstanding shares of
      Common Stock by recapitalization, reclassification or split-up thereof, or
      if the Corporation shall declare a stock dividend or distribute shares of
      Common Stock to its stockholders, the number of shares of Common Stock
      purchasable upon exercise of the options immediately prior to such
      subdivision shall be proportionately increased in each instance, and if
      the Corporation shall at any time combine the outstanding shares of Common
      Stock by  recapitalization, reclassification or combination
      thereof, the number of shares of Common Stock purchasable upon exercise of
      the options immediately prior to such combination shall be proportionately
      decreased in each instance.  Any adjustment which is the result
      of a stock dividend or distribution shall be effective on the record date
      therefor.

            

    

    

    
      	
               
      

            	
              2.

            	
              Whenever
      the number of shares of Common Stock purchasable upon the exercise of any
      of the options is required to be adjusted as provided in Section II(F)(1)
      above, the exercise price per share shall be adjusted (to the nearest
      cent) in each instance by multiplying such exercise price per share
      immediately prior to such adjustment by a fraction (x) the numerator of
      which shall be the number of shares of Common Stock purchasable upon the
      exercise of the options immediately prior to such adjustment, and (y) the
      denominator of which shall be the number of shares of Common Stock so
      purchasable immediately thereafter.

            

    

    

    
      	
               
      

            	
              3.

            	
              In
      case the Corporation shall, at any time prior to the expiration date of
      the options, and prior to the exercise thereof, offer to the holders of
      its Common Stock any right to subscribe for additional shares of any class
      of the Corporation, then the Corporation shall give written notice thereof
      to the registered holders of the options not less than thirty (30) days
      prior to the date on which the books of the Corporation are
      closed  or a record date fixed for the determination of
      stockholders entitled to such subscription rights.  Such notice
      shall specify the date as to which the books shall be closed or record
      date be fixed with respect to such offer or subscription, and the right of
      the holders to participate in such offer or subscription shall terminate
      if the options shall not be exercised on before the date of such closing
      of the books or such record date.

            

    

    

    
      	
               
      

            	
              4.

            	
              If
      the Corporation shall take any action affecting the shares of its Common
      Stock, other than that action described in this Plan, which, in the
      opinion of the Plan Administrator, would materially affect the rights of
      the holders of the options or the exercise price per share, the number of
      shares of Common Stock purchasable on exercise of the options shall be
      adjusted in each instance and at such time as the Plan Administrator, in
      good faith, may determine to be equitable under the
      circumstances.  The adjustments determined by the Plan
      Administrator shall be final, binding, and
  conclusive.

            

    

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    

    
      	
               
      

            	
              5.

            	
              Any
      changes or adjustments in the number of shares of Common Stock purchasable
      upon the exercise of the options or in the exercise price of options, as
      required or authorized by this Section II(F), shall be made with respect
      to all authorized options whether or not they have yet been issued or
      outstanding at the time of the occurrence of the circumstance leading to
      such change or adjustment.

            

    

    

    
      	
               
      

            	
              G.

            	
              Cancellation
      and Re-Grant of Options

            

    

    

    The Plan
Administrator shall have the authority to effect, at any time and from time to
time, with the consent of the affected option holders and subject to approval of
the shareholders of the Corporation, the cancellation of any or all outstanding
options under the Plan and to grant in substitution therefor new options
covering the same or different number of shares of Common Stock but with an
exercise price per share based on the Fair Market Value per share of Common
Stock on the new option grant date.  The type and amount of
consideration for the substituted options shall be subject to the approval of
the Plan Administrator.

    

    
      	
              III.

            	
              STOCK ISSUANCE
      PROGRAM

            

    

    

    
      	
               
      

            	
              A.

            	
              Stock
      Issuance Terms

            

    

    

    Shares of
Common Stock may be issued under the Stock Issuance Program through direct and
immediate issuances without any intervening option grants.  Each such
stock issuance shall be evidenced by a Stock Issuance Agreement which complies
with the terms specified below.

    

    
      	
               
      

            	
              1.

            	
              Cost
      of Shares.  Grants of shares
      of Common Stock under the Stock Issuance Program shall be made at such
      cost as the Plan Administrator shall determine and may be issued for no
      monetary consideration, subject to applicable state
  law.

            

    

    

    
      	
               
      

            	
              2.

            	
              Vesting
      Provisions.

            

    

    

    
      	
               
      

            	
              a.

            	
              Shares
      of Common Stock issued under the Stock Issuance Program may, in the
      discretion of the Plan Administrator, be fully and immediately vested upon
      issuance or may vest in one or more installments over the Participant’s
      period of Service or upon attainment of specified performance
      objectives.

            

    

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    
      	
            	
              
                b.

              

            	
              Any
      new, substituted or additional securities or other property (including
      money paid other than as a regular cash dividend) which the Participant
      may have the right to receive with respect to the Participant’s unvested
      shares of Common Stock by reason of any stock dividend, stock split,
      recapitalization, combination of shares, exchange of shares or other
      change affecting the outstanding Common Stock as a class without the
      Corporation’s receipt of consideration shall be issued subject to (i) the
      same vesting requirements applicable to the Participant’s unvested shares
      of Common Stock and (ii) such escrow arrangements as the Plan
      Administrator shall deem
appropriate.

            

    

    

    
      	
               
      

            	
              c.

            	
              Unless
      specified otherwise in the Stock Issuance Agreement, the Participant shall
      have full shareholder rights with respect to any shares of Common Stock
      issued to the Participant under the Stock Issuance Program, whether or not
      the Participant’s interest in those shares is vested, and accordingly, the
      Participant shall have the right to vote such shares and to receive any
      regular cash dividends paid on such
shares.

            

    

    

    
      	
               
      

            	
              d.

            	
              Should
      the Participant cease to remain in Service while holding one or more
      unvested shares of Common Stock issued under the Stock Issuance Program or
      should the performance objectives not be attained with respect to one or
      more such unvested shares of Common Stock, then those shares shall be
      immediately surrendered to the Corporation for cancellation, and the
      Participant shall have no further shareholder rights with respect to those
      shares.  To the extent the surrendered shares were previously
      issued to the Participant for consideration paid in cash or cash
      equivalent (including the Participant’s purchase-money indebtedness), the
      Corporation shall repay to the Participant the cash consideration paid for
      the surrendered shares and shall cancel the unpaid principal balance of
      any outstanding purchase-money note of the Participant attributable to
      such surrendered shares.

            

    

    

    
      	
               
      

            	
              e.

            	
              The
      Plan Administrator may in its discretion waive the surrender and
      cancellation of one or more unvested shares of Common Stock (or other
      assets attributable thereto) which would otherwise occur upon the
      non-completion of the vesting schedule applicable to such
      shares.  Such waiver shall result in the immediate vesting of
      the Participant’s interest in the shares of Common Stock as to which the
      waiver applies.  Such waiver may be effected at any time,
      whether before or after the Participant’s cessation of Service or the
      attainment or non-attainment of the applicable performance
      objectives.

            

    

    

    
      	
               
      

            	
              3.

            	
              Non-transferability.  Shares
      of Common Stock granted under the Stock Issuance program shall not be
      transferable until the shares are
vested.

            

    

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              B.

            	
              Corporate
      Transaction

            

    

    

    
      	
               
      

            	
              1.

            	
              Upon
      the occurrence of a Corporate Transaction all unvested shares not assumed
      by the successor corporation (or parent thereof) shall be immediately
      surrendered to the Corporation for cancellation, and the Participant shall
      have no further shareholder rights with respect to those
      shares.  To the extent the surrendered shares were previously
      issued to the Participant for consideration paid in cash or cash
      equivalent (including the Participant’s purchase-money indebtedness), the
      Corporation shall repay to the Participant the cash consideration paid for
      the surrendered shares and shall cancel the unpaid principal balance of
      any outstanding purchase-money note of the Participant attributable to
      such surrendered shares.

            

    

    

    
      	
               
      

            	
              2.

            	
              The
      Plan Administrator shall have the discretionary authority, exercisable
      either at the time the unvested shares are issued or any time while the
      Corporation’s repurchase rights with respect to those shares remaining
      outstanding, to provide that those rights shall automatically terminate on
      an accelerated basis, and the shares of Common Stock subject to those
      terminated rights shall immediately vest, in the event of a Corporate
      Transaction or in the event that the Participant’s Service should
      subsequently terminate by reason of an Involuntary Termination within a
      period designated by the Plan Administrator following the effective date
      of any Corporate Transaction in which those repurchase rights are assumed
      by the successor corporation (or parent
  thereof).

            

    

    

    
      	
               
      

            	
              C.

            	
              Share
      Escrow/Legends

            

    

    

    Unvested
shares may, in the Plan Administrator’s discretion, be held in escrow by the
Corporation until the Participant’s interest in such shares vests or may be
issued directly to the Participant with restrictive legends on the certificates
evidencing those unvested shares.

    

    
      	
              IV.

            	
              MISCELLANEOUS

            

    

    

    
      	
               
      

            	
              A.

            	
              Financing

            

    

    

    The Plan
Administrator may permit any Optionee or Participant to pay the option exercise
price or the purchase price for shares issued to such person under the by
delivering a full-recourse, interest-bearing promissory note payable in one or
more installments and secured by the purchased shares.  In no event
shall the maximum credit available to the Optionee or Participant exceed the sum
of (i) the aggregate option exercise price or purchase price payable for the
purchased shares plus (ii) any Federal, state and local income and employment
tax liability incurred by the Optionee or the Participant in connection with the
option exercise or share purchase.

    

    
      
        
           

        

        
          13

          
            

          

        

        
           

        

      

    

    
 

    
      	
               
      

            	
              B.

            	
              Effective
      Date and Term of Plan

            

    

    

    
      	
               
      

            	
              1.

            	
              The
      Plan shall become effective when adopted by the Board, but no option
      granted under the Plan may be exercised, and no shares shall be issued
      under the Plan, until the Plan is approved by the Corporation’s
      shareholders.  If such shareholder approval is not obtained
      within twelve (12) months after the date of the Board’s adoption of the
      Plan, then all options previously granted under the Plan shall terminate
      and cease to be outstanding, and no further options shall be granted and
      no shares shall be issued under the Plan.  Subject to such
      limitation, the Plan Administrator may grant options and issue shares
      under the Plan at any time after the effective date of the Plan and before
      the date fixed herein for termination of the
  Plan.

            

    

    

    
      	
               
      

            	
              2.

            	
              The
      Plan shall terminate upon the earliest of (i) ten years after the Plan was
      adopted by the Board or was approved by the Corporation’s shareholders,
      whichever was earlier, (ii) the date on which all shares available for
      issuance under the Plan shall have been issued, or (iii) the termination
      of all outstanding options in connection with a Corporate
      Transaction.  All options and unvested stock issuances
      outstanding at that time under the Plan shall continue to have full force
      and effect in accordance with the provisions of the documents evidencing
      such options or issuances.

            

    

    

    
      	
               
      

            	
              C.

            	
              Amendment
      of the Plan

            

    

    

    
      	
               
      

            	
              1.

            	
              The
      Board shall have complete and exclusive power and authority to amend or
      modify the Plan in any or all respects, except as set forth
      herein.  However, no such amendment or modification shall
      adversely affect the rights and obligations with respect to options or
      unvested stock issuances at the time outstanding under the Plan unless the
      Optionee or the Participant consents to such amendment or
      modification.  The Board shall not be required to submit any
      amendment to the Plan to a vote of the Corporation’s shareholders unless
      it is required by applicable statues or regulations.  An
      amendment that does not require shareholder approval may nevertheless not
      be effective unless such approval is obtained if the Board, in passing
      upon the amendment, so determines.  Notwithstanding the
      foregoing, the Board shall not amend the Plan, without approval of the
      shareholders of the Corporation, in a manner which
  would:

            

    

    

    
      	
               
      

            	
              a.

            	
              Cause
      Options which are intended to qualify as Incentive Options to fail to
      qualify;

            

    

    
      	
               
      

            	
              b.

            	
              increase
      the number of shares of Common Stock issuable over the term of the
      Plan;

            

    

    
      	
               
      

            	
              c.

            	
              extend
      the duration of the Plan;

            

    

    
      	
               
      

            	
              d.

            	
              cause
      the Plan to fail to meet the requirements of Rule 16b-3;
  or

            

    

    
      	
               
      

            	
              e.

            	
              violate
      applicable law.

            

    

    

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

       

    

    
      	
               
      

            	
              2.

            	
              Options
      may be granted under the Option Grant Program and shares may be issued
      under the Stock Issuance Program which are in each instance in excess of
      the number of shares of Common Stock then available for issuance under the
      Plan, provided any excess shares actually issued under those programs
      shall be held in escrow until there is obtained shareholder approval of an
      amendment sufficiently increasing the number of shares of Common Stock
      available for issuance under the Plan.  If such shareholder
      approval is not obtained within twelve (12) months after the date the
      first such excess issuances are made, then (i) any unexercised options
      granted on the basis of such excess shares shall terminate and cease to be
      outstanding and (ii) the Corporation shall promptly refund to the
      Optionees and the Participants the exercise or purchase price paid for any
      excess shares issued under the Plan and held in escrow, together with
      interest (at the applicable Short Term Federal Rate) for the period the
      shares were held in escrow, and such shares shall thereupon be
      automatically canceled and cease to be
  outstanding.

            

    

    

    
      	
               
      

            	
              D.

            	
              Use
      of Proceeds

            

    

    

    Any cash
proceeds received by the Corporation from the sale of shares of Common Stock
under the Plan shall be used for general corporate purposes.

    

    
      	
               
      

            	
              E.

            	
              Withholding

            

    

    

    The
Corporation’s obligation to deliver shares of Common Stock upon the exercise of
any options or upon the vesting of any shares issued under the Plan shall be
subject to the satisfaction of all applicable Federal, state and local income
and employment tax withholding requirements.

    

    
      	
               
      

            	
              F.

            	
              Regulatory
      Approvals

            

    

    

    The
implementation of the Plan, the granting of any options under the Plan and the
issuance of any shares of Common Stock (i) upon the exercise of any option or
(ii) under the Stock Issuance Program shall be subject to the Corporation’s
procurement of all approvals and permits required by regulatory authorities
having jurisdiction over the Plan, the options granted under it and the shares
of Common Stock issued pursuant to it.

    

    
      	
               
      

            	
              G.

            	
              No
      Employment or Service Rights

            

    

    

    Nothing
in the Plan shall confer upon the Optionee or the Participant any right to
continue in Service for any period of specific duration or interfere with or
otherwise restrict in any way the rights of the Corporation (or any Parent or
Subsidiary employing or retaining such person) or of the Optionee or the
Participant, which rights are hereby expressly reserved by each, to terminate
such person’s Service at any time for any reason, with or without
cause.

    

    
      
        
           

        

        
          15

          
            

          

        

        
           

        

      

    

    

    
      	
               
      

            	
              H.

            	
              Indemnification

            

    

    

    In
addition to such other rights as they may have as directors or as members of the
Committee, the members of the Plan Administrator shall be indemnified by the
Corporation against the reasonable expenses, including attorneys’ fees, actually
and necessarily incurred in connection with the defense of any action, suit, or
proceeding, and in connection with any appeal therein, to which they or any of
them may be a party by reason of any action or failure to act under or in
connection with this Plan or any option or stock award granted hereunder, and
against all amounts paid by them in settlement thereof (provided such settlement
is approved by independent legal counsel selected by the Corporation) or paid by
them in satisfaction of a judgment in any such action, suit, or proceeding,
except in relation to matters as to which it shall be finally adjudged in such
action, suit, or proceeding that such member of the Plan Administrator is liable
for gross negligence or willful misconduct in the performance of his duties;
provided that within 60 days after institution of any such action, suit, or
proceeding (or within 30 days after service upon such member of legal process in
such case, if later) a member of the Plan Administrator shall in writing offer
the Corporation the opportunity, at its own expense, to handle and defend the
same.

    

    
      	
               
      

            	
              I.

            	
              Rule
      16b-3

            

    

    

    With
respect to Participates subject to Rule 16b-3, transactions under the Plan are
intended to comply with all applicable provisions of Rule 16b-3.  To
the extent any provision of the Plan or action by the Plan Administrator fails
to so comply, it shall be deemed null and void, to the extent permitted by law
and deemed advisable by the Plan Administrator.

    

    
      	
               
      

            	
              J.

            	
              Relationship
      to Other Plans

            

    

    

    Nothing
in this Plan shall prevent the Corporation (or any Parent or Subsidiary) from
adopting or continuing other or additional compensation arrangements, including
without limitation plans providing for the granting of restricted stock awards,
options, cash, or Common Stock performance bonuses.  Grants under the
Plan may form a part of or otherwise be related to such other or additional
compensation arrangements.

    

    
      
        
           

        

        
          16

          
            

          

        

        
           

        

      

    

     

    APPENDIX

    

    The
following definitions shall be in effect under the Plan:

    

    Board
shall mean the Corporation’s Board of Directors.

    

    Code
shall mean the Internal Revenue Code of 1986, as amended.

    

    Committee
shall mean a committee of two (2) or more non-employee Board members appointed
by the Board to exercise one or more administrative functions under the
Plan.

    

    Common
Stock shall mean the Corporation’s common stock.

    

    Corporate
Transaction shall mean either of the following shareholder approved
transactions to which the Corporation is a party:

    

    (a)           a
merger or consolidation in which securities possessing more than fifty percent (50%) of the
total combined voting power of the Corporation’s outstanding securities are
transferred to a person or persons different from the persons holding those
securities immediately prior to such transaction, or

    

    (b)           the
sale, transfer or other disposition of all or substantially all of the
Corporation’s assets in complete liquidation or dissolution of the
Corporation.

    

    Corporation
shall mean Desert Hawk Gold Corp. (formerly known as Lucky Joe Mining Company),
a Nevada corporation.

    

    Disability
shall mean the inability of the Optionee or the Participant to engage in any
substantial gainful activity by reason of any medically determinable physical or
mental impairment and shall be determined by the Plan Administrator on the basis
of such medical evidence as the Plan Administrator deems warranted under the
circumstances.

    

    Employee
shall mean an individual who is in the employ of the Corporation (or any Parent
or Subsidiary), subject to the control and direction of the employer entity as
to both the work to be performed and the manner and method of
performance.

    

    Exercise
Date shall mean the date on which the Corporation shall have received
written notice of the option exercise.

    

    Fair
Market Value per share of Common Stock on any relevant date shall be
determined as prescribed by the Code and regulations promulgated thereunder, or
as otherwise determined by the Plan Administrator.

    

    
      
        
           

        

        
          17

          
            

          

        

        
           

        

      

    

    

    Incentive
Option shall mean an option which satisfies the requirements of Code
Section 422.

    

    Involuntary
Termination shall mean the termination of the Service of any individual
which occurs by reason of:

    

    (a)           such
individual’s involuntary dismissal or discharge by the Corporation for reasons
other than Misconduct, or

    

    (b)           such
individual’s voluntary resignation following (A) a change in his or her position
with the Corporation which materially reduces his or her level of
responsibility, (B) a reduction in his or her level of compensation (including
base salary, fringe benefits and target bonuses under any corporate performance
based bonus or incentive programs) by more than fifteen percent (15%), or (c) a
relocation of such individual’s place of employment by more than fifty (50)
miles, provided and only if such change, reduction or relocation is effected
without the individual’s consent.

    

    The Plan
Administrator shall be entitled to revise the definition of Involuntary
Termination and Misconduct with respect to individual Optionees or Participants
under the Plan.

    

    Misconduct
shall mean the commission of any act of fraud, embezzlement or dishonesty by the
Optionee or Participant, any unauthorized use or disclosure by such person of
confidential information or trade secrets of the Corporation (or any Parent or
Subsidiary), or any other intentional misconduct by such person adversely
affecting the business or affairs of the Corporation (or any Parent or
Subsidiary) in a material manner.  The foregoing definition shall not
be deemed to be inclusive of all the acts or omissions which the Corporation (or
any Parent or Subsidiary) may consider as grounds for the dismissal or discharge
of any Optionee, Participant or other person in the Service of the Corporation
(or any Parent or Subsidiary).

    

    1934
Act shall mean the Securities Exchange Act of 1934, as
amended.

    

    Non-Statutory
Option shall mean an option not intended to satisfy the requirements of
Code Section 422.

    

    Option
Grant Program shall mean the option grant program in effect under the
Plan.

    

    Optionee
shall mean any person to whom an option is granted under the Plan.

    

    Parent
shall mean any corporation (other than the Corporation) in an unbroken chain of
corporations ending with the Corporation, provided each corporation in the
unbroken chain (other than the Corporation) owns, at the time of the
determination, stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain.

    

    
      
        
           

        

        
          18

          
            

          

        

        
           

        

      

    

    

    

    Participant
shall mean any person who is issued shares of Common Stock under the Stock
Issuance Program.

    

    Plan
shall mean the Corporation’s 2008 Stock Option/Stock Issuance Plan, as set forth
in this document.

    

    Plan
Administrator shall mean either the Board or the Committee acting in its
capacity as administrator of the Plan.

    

    Rule
16b-3 shall mean Rule 16b-3 promulgated under the 1934 Act by the U.S.
Securities and Exchange Commission, as amended, or any successor rule in effect
from time to time.

    

    Service
shall mean the provision of services to the Corporation (or any Parent or
Subsidiary) by a person in the capacity of an Employee, a non-employee member of
the board of directors or a consultant or independent advisor, except to the
extent otherwise specifically provided in the documents evidencing the option
grant.

    

    Stock
Issuance Agreement shall mean the agreement entered into by the
Corporation and the Participant at the time of issuance of shares of Common
Stock under the Stock Issuance Program.

    

    Stock
Issuance Program shall mean the stock issuance program in effect under
the Plan.

    

    Subsidiary
shall mean any corporation (other than the Corporation) in an unbroken chain of
corporations beginning with the Corporation, provided each corporation (other
than the last corporation) in the unbroken chain owns, at the time of the
determination, stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain.

    

    10%
Shareholder shall mean the owner of
stock (as determined under Code Section 424(d)) possessing more than ten percent
(10%) of the total combined voting power of all classes of stock of the
Corporation (or any Parent or Subsidiary).

    

    
      
        
           

        

        
          19

          
            

          

        

        
           

        

      

    

    

    THESE SECURITIES HAVE NOT BEEN
REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION BECAUSE
THEY ARE BELIEVED TO BE EXEMPT FROM REGISTRATION UNDER SECTION 4(2) AND/OR 4(6)
OF THE SECURITIES ACT OF 1933.

    

    THESE SECURITIES HAVE NOT BEEN APPROVED
OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION.  NEITHER THE
SECURITIES AND EXCHANGE COMMISSION NOR ANY OTHER AUTHORITY HAS PASSED UPON OR
ENDORSED THE MERITS OF THE OFFERING OR THE ACCURACY OR ADEQUACY OF THE
INFORMATION PROVIDED TO THE INVESTORS.  ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.  INVESTORS MUST RELY ON THEIR OWN
EXAMINATION OF THE COMPANY, AND THE RISKS, MERITS AND TERMS OF THIS OFFERING IN
MAKING AN INVESTMENT DECISION.

    

    DESERT
HAWK GOLD CORP

    GRANT
OF STOCK OPTION

    

    This Grant of Stock Option is hereby
offered to Optionee with respect to the following option grant (the “Option”) to
purchase shares of the Common Stock of Desert Hawk Gold Corp. (the
“Corporation”):

    
      

      
        
          
            
              
                
                  	
                          Optionee:

                        	 
      	 
      

                

              

            

          

        

      

      

      
        
          
            
              	
                      Grant Date:

                    	  	  

            

          

        

      

      

      
        
          
            
              
                	
                        Vesting Commencement:

                      	  	  

              

            

          

        

      

      

      
        
          	
                  Exercise Price:  $_____ per share

                	  

        

      

      

      
        
          	
                  Number of Option Shares:                                       shares

                	
                    

                

        

      

      

      
        
          
            
              	
                      Expiration Date:

                    	  	  

            

          

        

      

      

      
        
          
            
              	
                      Type of Option:

                    	______ Non-Statutory	
                       

                    
	 	
                      
                        ______ Incentive Stock Option

                      

                    	
                       

                    

            

          

        

      

      

      
        
          	
                  Date Exercisable:  Following Vesting

                	  

        

      

      

      
        
          
            
              
                	
                        Vesting Schedule:

                      	   	  

              

            

          

        

      

    

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                 

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

    Optionee understands and agrees that
the Option is granted subject to and in accordance with the terms of the
Company’s 2008 Stock Option/Stock Issuance Plan (the
“Plan”).  Optionee further agrees to be bound by the terms of the Plan
and the terms of the Option as set forth in the Stock Option Agreement, a copy
of which is attached hereto as Exhibit A.

    

    
      
        
           

        

        
          20

          
            

          

        

        
           

        

      

    

    

    Optionee understands that any Option
Shares purchased under the Option will be subject to the terms set forth in the
Stock Purchase Agreement attached hereto as Exhibit B.  Optionee
hereby acknowledges receipt of a copy of the Plan in the form attached hereto as
Exhibit C.

    

    All capitalized terms in this Grant
form shall have the meaning assigned to them in this form or in the attached
Plan.

    

    Assuming that you are in agreement with
the terms of this Grant of Stock Option, please sign your name in the space
indicated below.

     

    
      
        
          	 
      	
                  Desert
      Hawk Gold Corp.

                
	 
      	 
      	 
      
	 
      	
                  By

                	
                   

                
	 
      	 
      	
                  Robert
      E. Jorgensen, CEO

                

        

      

      

      
        
          
            
              
                
                  
                    
                      
                        
                          	
                                  AGREED:

                                	 
      
	 
      	 
      
	 
      	 
      
	
                                  Optionee

                                	 
      
	 
      	 
      
	 
      	 
      
	
                                  Print
      Name

                                	 
      
	 
      	 
      
	
                                  Address:

                                	 
      	 
      
	 	 	 
	 	 	 

                        

                      

                    

                  

                

              

            

          

        

      

      

      
        	
                Exhibit
      A

              	
                Stock
      Option Agreement

              

      

      
        	
                Exhibit
      B

              	
                Stock
      Purchase Agreement

              

      

      
        	
                Exhibit
      C

              	
                2008
      Stock Option/Stock Issuance
Plan

              

      

    

     

    
      
        
           

        

        
          21

          
            

          

        

        
           

        

      

    

    

    EXHIBIT
A

    

    DESERT
HAWK GOLD CORP.

    STOCK
OPTION AGREEMENT

    

    RECITALS

    

    A.           The
Board has adopted the Plan for the purpose of retaining the services of selected
Employees, non-employee members of the Board or the Board of Directors of any
Parent or Subsidiary and consultants and other independent advisors in the
service of the Corporation (or any Parent or Subsidiary).

    

    B.           Optionee
is to render valuable services to the Corporation (or a Parent or Subsidiary),
and this Agreement is executed pursuant to, and is intended to carry out the
purposes of, the Plan in connection with the Corporation’s grant of an option to
Optionee.

    

    C.           All
capitalized terms in this Agreement shall have the meaning assigned to them in
the attached Appendix.

    

    NOW, THEREFORE, it is hereby agreed as
follows:

    

    1.           Grant of
Option.  The Corporation hereby grants to Optionee, as of the
Grant Date, an option to purchase up to the number of Option Shares specified in
the Grant Form.  The Option Shares shall be purchasable from time to
time during the option term specified in Paragraph 2 at the Exercise
Price.

    

    2.           Option
Term.  This option shall have a term commencing on the Grant
Date and shall accordingly expire at the close of business on the Expiration
Date, unless sooner terminated in accordance with Paragraph 5 or 6.

    

    3.           Limited
Transferability.  During Optionee’s lifetime, this option shall
be exercisable only by Optionee and shall not be assignable or transferable
other than by will or by the laws of descent and distribution following
Optionee’s death.

    

    4.           Dates of
Exercise.  This option shall become exercisable for the Option
Shares in one or more installments as specified in the Grant Form.  As
the option becomes exercisable for such installments, those installments shall
accumulate and the option shall remain exercisable for the accumulated
installments until the Expiration Date or sooner termination of the option term
under Paragraph 5 or 6.

    

    5.           Cessation of
Service.  Except as provided in the Grant Form or the Plan, the
option term specified in Paragraph 2 shall terminate (and this option shall
cease to be outstanding) prior to the Expiration Date should the Optionee cease
to remain in Service as provided in the Plan.  Except as provided in
the Grant Form or the Plan, during the limited period of post-Service
exercisability, this option may not be exercised in the aggregate for more than
the number of Option Shares in which Optionee is, at the time of Optionee’s
cessation of Service, vested pursuant to the Vesting Schedule specified in the
Grant Form.  Upon the expiration of such limited exercise period or
(if earlier) upon the Expiration Date, this option shall terminate and cease to
be outstanding for any vested Option Shares for which the option has not been
exercised.  To the extent Optionee is not vested in the Option Shares
at the time of Optionee’s cessation of Service, this option shall immediately
terminate and cease to be outstanding with respect to those
shares.  In the event of a Corporate Transaction, the provisions of
Paragraph 6 shall govern the period for which this option is to remain
exercisable following Optionee’s cessation of Service and shall supersede any
provisions to the contrary in this paragraph.

    

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

       

    

    6.           Corporate
Transaction

    

    (a)           The
vesting provisions set forth in the Grant Form shall apply in the event of a
Corporate Transaction (as defined in the appendix to this
Agreement).

    

    (b)           Any
unvested option shall immediately vest in its entirety effective upon the time
immediately prior to the consummation of a Corporate Transaction .

    

    (c)           If
this option is assumed in connection with a Corporate Transaction, then this
option shall be appropriately adjusted, immediately after such Corporate
Transaction, to apply to the number and class of securities which would have
been issuable to Optionee in consummation of such Corporate Transaction had the
option been exercised immediately prior to such Corporate Transaction, and
appropriate adjustments shall also be made to (i) the number and class of
securities available for issuance under the Plan following the consummation of
such Corporate Transaction and (ii) the Exercise Price, provided, the aggregate
Exercise Price shall remain the same.

    

    (d)           This
Agreement shall not in any way affect the right of the Corporation to adjust,
reclassify, reorganize or otherwise change its capital or business structure or
to merge, consolidate, dissolve, liquidate or sell or transfer all or any part
of its business or assets.

    

    7.           Adjustment in Option
Shares.  Should any change be made to the Common Stock by
reason of any stock split, stock dividend, recapitalization, combination of
shares, exchange of shares or other change affecting the outstanding Common
Stock as a class without the Corporation’s receipt of consideration, appropriate
adjustments shall be made to (i) the total number and/or class of securities
subject to this option and (ii) the Exercise Price in order to reflect such
change and thereby preclude a dilution or enlargement of benefits
hereunder.

    

    8.           Shareholder
Rights.  The holder of this option shall not have any
shareholder rights with respect to the Option Shares until such person shall
have exercised the option, paid the Exercise Price and become a holder of record
of the purchased shares.

    

    
      
        
           

        

        
          23

          
            

          

        

        
           

        

      

    

    

    9.           Manner of Exercising
Option.

    

    (a)           In
order to exercise this option with respect to all or any part of the Option
Shares for which this option is at the time exercisable, Optionee (or any other
person or persons exercising the option) must take the following
actions:

    

    (i)           Execute
and deliver to the Corporation a Purchase Agreement for the Option Shares for
which the option is exercised.

    

    (ii)           Pay
the aggregate Exercise Price for the purchased shares in one or more of the
following forms:

    

    (A)           cash
or check made payable to the Corporation; or

    

    (B)           a
promissory note payable to the Corporation, but only to the extent authorized by
the Plan Administrator in accordance with Paragraph 13.

    

    (C)           in
shares of Common Stock held by Optionee (or any other person or persons
exercising the option) for the requisite period necessary to avoid a charge to
the Corporation’s earnings for financial reporting purposes and valued at Fair
Market Value on the Exercise Date; or

    

    (D)           to
the extent the option is exercised for vested Option Shares, through a special
sale and remittance procedure pursuant to which Optionee (or any other person or
persons exercising the option) shall concurrently provide irrevocable
instructions (a) to a Corporation-designated brokerage firm to effect the
immediate sale of the purchased shares and remit to the Corporation, out of the
sale proceeds available on the settlement date, sufficient funds to cover the
aggregate Exercise Price payable for the purchased shares plus all applicable
Federal, state and local income and employment taxes required to be withheld by
the Corporation by reason of such exercise and (b) to the Corporation to deliver
the certificates for the purchased shares directly to such brokerage firm in
order to complete the sale.

    

    Except to the extent the sale and
remittance procedure is utilized in connection with the option exercise, payment
of the Exercise Price must accompany the Purchase Agreement delivered to the
Corporation in connection with the option exercise.

    

    (iii)         Furnish
to the Corporation appropriate documentation that the person or persons
exercising the option (if other than Optionee) have the right to exercise this
option.

    

    (iv)         Execute
and deliver to the Corporation such written representations as may be requested
by the Corporation in order for it to comply with the applicable requirements of
Federal and state securities laws.

    
 

    
      
        
           

        

        
          24

          
            

          

        

        
           

        

      

    

    

    (v)          Make
appropriate arrangements with the Corporation (or Parent or Subsidiary employing
or retaining Optionee) for the satisfaction of all federal, state and local
income and employment tax withholding requirements applicable to the option
exercise.

    

    (b)         As
soon as practical after the Exercise Date, the Corporation shall issue to or on
behalf of Optionee (or any other person or persons exercising this option) a
certificate for the purchased Option Shares, with the appropriate legends
affixed thereto.

    

    (c)         In
no event may this option be exercised for any fractional shares.

    

    10.           Compliance with Laws and
Regulations.

    

    (a)         The
exercise of this option and the issuance of the Option Shares upon such exercise
shall be subject to compliance by the Corporation and Optionee with all
applicable requirements of law relating thereto and with all applicable
regulations of any stock exchange (or the NASDAQ National Market, if applicable)
on which the Common Stock may be listed for trading at the time of such exercise
and issuance.

    

    (b)         The
inability of the Corporation to obtain approval from any regulatory body having
authority deemed by the Corporation to be necessary to the lawful issuance and
sale of any Common Stock pursuant to this option shall relieve the Corporation
of any liability with respect to the non-issuance or sale of the Common Stock as
to which such approval shall not have been obtained.  The Corporation,
however, shall use its best efforts to obtain all such approvals.

    

    11.           Successors and
Assigns.  Except to the extent otherwise provided in Paragraphs
3 and 6, the provisions of this Agreement shall inure to the benefit of, and be
binding upon, the Corporation and its successors and assigns and Optionee,
Optionee’s assigns and the legal representatives, heirs and legatees of
Optionee’s estate.

    

    12.           Notices.  Any
notice required to be given or delivered to the Corporation under the terms of
this Agreement shall be in writing and addressed to the Corporation at its
principal corporate offices.  Any notice required to be given or
delivered to Optionee shall be in writing and addressed to Optionee at the
address indicated below Optionee’s signature line on the Grant
Form.  All notices shall be deemed effective upon personal delivery or
upon deposit in the U.S. mail, postage prepaid and properly addressed to the
party to be notified.

    

    13.           Financing.  The
Plan Administrator may, in its absolute discretion and without any obligation to
do so, permit Optionee to pay the Exercise Price for the purchased Option Shares
by delivering a full-recourse, interest-bearing promissory note secured by those
Option Shares.  The payment schedule in effect for any such promissory
note shall be established by the Plan Administrator in its sole
discretion.

    

    14.           Construction.  This
Agreement and the option evidenced hereby are made and granted pursuant to the
Plan and are in all respects limited by and subject to the terms of the
Plan.  All decisions of the Plan Administrator with respect to any
question or issue arising under the Plan or this Agreement shall be conclusive
and binding on all persons having an interest in this option.

    

    
      
        
           

        

        
          25

          
            

          

        

        
           

        

      

    

    

    15.           Shareholder
Approval.  If the Option Shares covered by this Agreement
exceed, as of the Grant Date, the number of shares of Common Stock which may be
issued under the Plan as last approved by the shareholders, then this option
shall be void with respect to such excess shares, unless shareholder approval of
an amendment sufficiently increasing the number of shares of Common Stock
issuable under the Plan is obtained in accordance with the provisions of the
Plan.

    

    16.           Additional Terms Applicable
to an Incentive Option.  To the extent any option designated in
the Grant Form as an Incentive Option would not qualify in whole or in part for
favorable tax treatment as an Incentive Option at the time of exercise, such
option may nevertheless be exercised by the Optionee as a Non-Statutory
Option.

    

    APPENDIX

    

    The
following definitions shall be in effect under the Agreement:

    

    1.           Agreement shall mean
this Stock Option Agreement.

    

    2.           Board shall mean the
Corporation’s Board of Directors.

    

    3.           Code shall mean the
Internal Revenue Code of 1986, as amended.

    

    4.           Committee shall mean
a committee of two (2) or more non-employee Board members appointed by the Board
to exercise one or more administrative functions under the Plan.

    

    5.           Common Stock shall
mean the Corporation’s common stock.

    

    
      	
              6.

            	
              Corporate
      Transaction shall mean either of the following shareholder approved
      transactions to which the Corporation is a
  party:

            

    

    

    (a)           a
merger or consolidation in which securities possessing more than fifty percent
(50%) of the total combined voting power of the Corporation’s outstanding
securities are transferred to a person or persons different from the persons
holding those securities immediately prior to such transaction, or

    

    (b)           the
sale, transfer or other disposition of all or substantially all of the
Corporation’s assets in complete liquidation or dissolution of the
Corporation.

    

    
      	
              7.

            	
              Corporation
      shall mean Desert Hawk Gold Corp., an Nevada corporation, and any
      successor corporation to all or substantially all of the assets or voting
      stock of Desert Hawk Gold Corp. which shall by appropriate action adopt
      the Plan.

            

    

    

    
      
        
           

        

        
          26

          
            

          

        

        
           

        

      

    

    

    
      	
              8.

            	
              Disability
      shall mean the inability of the Optionee or the Participant to engage in
      any substantial gainful activity by reason of any medically determinable
      physical or mental impairment and shall be determined by the Plan
      Administrator on the basis of such medical evidence as the Plan
      Administrator deems warranted under the
  circumstances.

            

    

    

    
      	
              9.

            	
              Employee shall
      mean an individual who is in the employ of the Corporation (or any Parent
      or Subsidiary), subject to the control and direction of the employer
      entity as to both the work to be performed and the manner and method of
      performance.

            

    

    

    
      	
              10.

            	
              Exercise Date
      shall mean the date on which the option shall have been exercised in
      accordance with Paragraph 9 of the
Agreement.

            

    

    

    
      	
              11.

            	
              Exercise Price
      shall mean the exercise price payable per Option Share as specified in the
      Grant Form.

            

    

    

    
      	
              12.

            	
              Expiration Date
      shall mean the date on which the option expires as specified in the Grant
      Form.

            

    

    

    
      	
              13.

            	
              Fair Market
      Value per share of Common Stock on any relevant date shall be
      determined in accordance with the following
  provisions:

            

    

    

    (a)    If
the Common Stock is at the time traded on the NASDAQ National Market, then the
Fair Market Value shall be the closing selling price per share of Common Stock
on the date in question, as such price is reported by the National Association
of Securities Dealers on the NASDAQ National Market or any successor
system.  If there is no closing selling price for the Common Stock on
the date in question, then the Fair Market Value shall be the closing selling
price on the last preceding date for which such quotation exists.

    

    (b)           If
the Common Stock is at the time listed on any Stock Exchange, then the Fair
Market Value shall be the closing selling price per share of Common Stock on the
date in question on the Stock Exchange determined by the Plan Administrator to
be the primary market for the Common Stock, as such price is officially quoted
in the composite tape of transactions on such exchange.  If there is
no closing selling price for the Common Stock on the date in question, then the
Fair Market Value shall be the closing selling price on the last preceding date
for which such quotation exists.

    

    (c)           If
the Common Stock is at the time neither listed on any Stock Exchange nor traded
on the NASDAQ National Market, then the Fair Market Value shall be determined by
the Plan Administrator after taking into account such factors as the Plan
Administrator shall deem appropriate.

    

    14.           Grant Date shall mean
the date of grant of the option as specified in the Grant Form.

    
      
 

      
        	
                15.

              	
                Grant Form
      shall mean the Grant of Stock Option accompanying the Agreement, pursuant
      to which Optionee has been informed of the basic terms of the option
      evidenced hereby.

              

      

       

    

    
      
        
           

        

        
          27

          
            

          

        

        
           

        

      

    

    

    
      	
              16.

            	
              Incentive
      Option shall mean an option which satisfies the requirements of
      Code Section 422.

            

    

    

    
      	
              17.

            	
              Involuntary
      Termination shall mean the termination of the Service of any
      individual which occurs by reason of
:

            

    

    

    (a)           such
individual’s involuntary dismissal or discharge by the Corporation for reasons
other than Misconduct, or

    (b)           such
individual’s voluntary resignation following (A) a change in his or her position
with the Corporation which materially reduces his or her level of
responsibility, (B) a reduction in his or her level of compensation (including
base salary, fringe benefits and target bonuses under any corporate performance
based bonus or incentive programs) by more than fifteen percent (15%), or (C) a
relocation of such individual’s place of employment by more than fifty (50)
miles, provided and only if such change, reduction or relocation is effected
without the individual’s consent.

    

    The Plan
Administrator shall be entitled to revise the definition of Involuntary
Termination and Misconduct with respect to individual Optionees or Participants
under the Plan.

    

    
      	
              18.

            	
              Misconduct
      shall mean (i) the final conviction of Employee of, or Employee’s plea of
      guilty or nolo contendere to, any felony involving moral turpitude, (ii)
      fraud, misappropriation or embezzlement by Employee in connection with
      Employee’s duties to the Corporation (or any Parent of Subsidiary), or
      (iii) Employee’s willful failure or gross misconduct in the performance of
      his duties to the Corporation (or any Parent or
    Subsidiary).

            

    

    

    19.           1934 Act shall mean
the Securities Exchange Act of 1934, as amended.

    

    
      	
              20.

            	
              Non-Statutory
      Option shall mean an option not intended to satisfy the
      requirements of Code Section 422.

            

    

    

    
      	
              21.

            	
              Option Shares
      shall mean the number of shares of Common Stock subject to the
      option.

            

    

    

    
      	
              22.

            	
              Optionee shall
      mean the person to whom the option is granted as specified in the Grant
      Form.

            

    

    

    
      	
              23.

            	
              Parent shall
      mean any corporation (other than the Corporation) in an unbroken chain of
      corporations ending with the Corporation, provided each corporation in the
      unbroken chain (other than the Corporation) owns, at the time of the
      determination, stock possessing fifty percent (50%) or more of the total
      combined voting power of all classes of stock in one of the other
      corporations in such chain.

            

    

    

    
      
        
           

        

        
          28

          
            

          

        

        
           

        

      

    

    

    24.           Plan shall mean the
Corporation’s 2008 Stock Option/Stock Issuance Plan.

    

    
      	
              25.

            	
              Plan
      Administrator shall mean either the Board or the Committee of the
      Board acting in its capacity as administrator of the
  Plan.

            

    

    

    
      	
              26.

            	
              Purchase
      Agreement shall mean the stock purchase agreement in substantially
      the form of Exhibit B to the Grant
Form.

            

    

    

    
      	
              27.

            	
              Service shall
      mean the provision of services to the Corporation (or any Parent or
      Subsidiary) by a person in the capacity of an Employee, a non-employee
      member of the board of directors or a consultant or independent advisor,
      except to the extent otherwise specifically provided in the documents
      evidencing the option grant.

            

    

    

    
      	
              28.

            	
              Stock Exchange
      shall mean the American Stock Exchange or the New York Stock
      Exchange.

            

    

    

    
      	
              29.

            	
              Subsidiary
      shall mean any corporation (other than the Corporation) in an unbroken
      chain of corporations beginning with the Corporation, provided each
      corporation (other than the last corporation) in the unbroken chain owns,
      at the time of the determination, stock possessing fifty percent (50%) or
      more of the total combined voting power of all classes of stock in one of
      the other corporations in such
chain.

            

    

    

    
      	
              30.

            	
              Vesting
      Schedule shall mean the vesting schedule specified in the Grant
      Form pursuant to which the Optionee is to vest in the Option Shares in a
      series of installments over his or her period of
  Service.

            

    

    

    
      
        
           

        

        
          29

          
            

          

        

        
           

        

      

    

    

    EXHIBIT
B

    

    DESERT
HAWK GOLD COMPANY

    STOCK
PURCHASE AGREEMENT

    

    AGREEMENT made this            
 day of                                            ,
20      
, by and between Desert Hawk Gold Corp., an Nevada corporation, and
_____________________,  Optionee under the Corporation’s 2008 Stock
Option/Stock Issuance Plan.

    

    All capitalized terms in this Agreement
shall have the meaning assigned to them in this Agreement or in the attached
Appendix.

    

    A.           EXERCISE OF
OPTION

    

    1.           Exercise.  Optionee
hereby purchases                                                  shares
of Common Stock (the “Purchased Shares”) pursuant to that certain option (the
“Option”) granted Optionee on _______________, 20___ (the “Grant Date”) to
purchase up to ______________ shares of Common Stock (the “Option Shares”)
under the Plan at the exercise price of $                
 per share (the “Exercise Price”).

    

    2.           Payment.  Concurrently
with the delivery of this Agreement to the Corporation, Optionee shall pay the
Exercise Price for the Purchased Shares in accordance with the provisions of the
Option Agreement and shall deliver whatever additional documents may be required
by the Option Agreement as a condition for exercise.

    

    3.           Shareholder
Rights.  Optionee (or any successor in interest) shall have all
the rights of a shareholder (including voting, dividend and liquidation rights)
with respect to the Purchased Shares, subject, however, to the transfer
restrictions of Sections B and C.

    

    
      	
              B.

            	
              SPECIAL TAX
      ELECTION

            

    

    

    In the event the Purchased Shares
include Option Shares which have not yet vested as of the date hereof, the
acquisition of the Purchased Shares may result in adverse tax consequences which
may be avoided or mitigated by filing an election under Code Section
83(b).  Such election must be filed within thirty (30) days after the
date of this Agreement.  OPTIONEE SHOULD CONSULT WITH HIS OR
HER TAX ADVISOR TO DETERMINE THE TAX CONSEQUENCES OF ACQUIRING THE PURCHASED
SHARES AND THE ADVANTAGES AND DISADVANTAGES OF FILING THE CODE SECTION 83(b)
ELECTION.  OPTIONEE ACKNOWLEDGES THAT IT IS OPTIONEE’S SOLE
RESPONSIBILITY, AND NOT THE CORPORATION’S, TO FILE A TIMELY ELECTION UNDER CODE
SECTION 83(b), EVEN IF OPTIONEE REQUESTS THE CORPORATION OR ITS REPRESENTATIVES
TO MAKE THIS FILING ON HIS OR HER BEHALF.

    

    
      
        
           

        

        
          30

          
            

          

        

        
           

        

      

    

    

    C.          GENERAL
PROVISIONS

    

    1.           No Employment or Service
Contract.  Nothing in this Agreement or in the Plan shall
confer upon Optionee any right to continue in Service for any period of specific
duration or interfere with or otherwise restrict in any way the rights of the
Corporation (or any Parent or Subsidiary employing or retaining Optionee) or of
Optionee, which rights are hereby expressly reserved by each, to terminate
Optionee’s Service at any time for any reason, with or without
cause.

    

    2.           Notices.  Any
notice required to be given under this Agreement shall be in writing and shall
be deemed effective upon personal delivery or upon deposit in the U.S. mail,
registered or certified, postage prepaid and properly addressed to the party
entitled to such notice at the address indicated below such party’s signature
line on this Agreement or at such other address as such party may designate by
ten (10) days advance written notice under this paragraph to all other parties
to this Agreement.

    

    3.           No
Waiver.  No waiver of any breach or condition of this Agreement
shall be deemed to be a waiver of any other or subsequent breach or condition,
whether of like or different nature.

    

    D.          MISCELLANEOUS
PROVISIONS

    

    1.           Optionee
Undertaking.  Optionee hereby agrees to take whatever
additional action and execute whatever additional documents the Corporation may
deem necessary or advisable in order to carry out or effect one or more of the
obligations or restrictions imposed on either Optionee or the Purchased Shares
pursuant to the provisions of this Agreement.

    

    2.           Agreement is Entire
Contract.  This Agreement constitutes the entire contract
between the parties hereto with regard to the subject matter
hereof.  This Agreement is made pursuant to the provisions of the Plan
and shall in all respects be construed in conformity with the terms of the
Plan.

    

    3.           Counterparts.  This
Agreement may be executed in counterparts, each of which shall be deemed to be
an original, but all of which together shall constitute one and the same
instrument.

    

    4.           Successors and
Assigns.  The provisions of this Agreement shall inure to the
benefit of, and be binding upon, the Corporation and its successors and assigns
and upon Optionee, Optionee’s permitted assigns and the legal representatives,
heirs and legatees of Optionee’s estate, whether or not any such person shall
have become a party to this Agreement and have agreed in writing to join herein
and be bound by the terms hereof

    

    
      
        
           

        

        
          31

          
            

          

        

        
           

        

      

    

    

    IN WITNESS WHEREOF, the parties have
executed this Agreement on the day and year first indicated above.

    

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          
                                                            
                                                              	 
      	
                                                                      Desert
      Hawk Gold Corp.

                                                                    
	 
      	 
      	 
      
	 
      	

                                                                      By:  

                                                                    	
                                                                       

                                                                    	 
      
	 
      	

                                                                      Title:  

                                                                    	
                                                                       

                                                                    	 
      
	 
      	 
      	 
      
	 
      	
                                                                      Address: 
        

                                                                    	 
      
	 
      	
                                                                       

                                                                    	 
      
	 
      	 
      	 
      
	 
      	
                                                                      OPTIONEE

                                                                    
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                                                                      (Signature)

                                                                    
	 	 	 
	 
      	 
      	 
      
	 
      	
                                                                      (Print
      Name)

                                                                    
	 
      	 
      	 
      
	 
      	
                                                                      Address: 
      

                                                                    	 
      
	 
      	 
      	 
      

                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      
                                                   

    
      
        
           

        

        
          32

          
            

          

        

        
           

        

      

    

    

    SPOUSAL
ACKNOWLEDGMENT

    

    The undersigned spouse of Optionee has
read and hereby approves the foregoing Stock Purchase Agreement.  In
consideration of the Corporation’s granting Optionee the right to acquire the
Purchased Shares in accordance with the terms of such Agreement, the undersigned
hereby agrees to be irrevocably bound by all the terms of such Agreement,
including (without limitation) the right of the Corporation (or its assigns) to
purchase any Purchased Shares in which Optionee is not vested at time of his or
her cessation of Service.

     

    
      
        
          
            
              
                
                  
                    
                      	 
      	 
      	 
      
	 
      	
                              OPTIONEE’S
      SPOUSE

                            
	 
      	 
      	 
      
	 
      	
                              Address: 
      

                            	 
      
	 	 	 

                    

                  

                

              

            

          

        

      

    

    

    APPENDIX

    

    The following definitions shall be in
effect under the Agreement:

    

    
      	
              1.

            	
              Agreement shall
      mean this Stock Purchase Agreement.

            

    

    

    
      	
              2. 

            	
              Board shall
      mean the Corporation’s Board of
Directors.

            

    

    

    
      	
              3. 

            	
              Code shall mean
      the Internal Revenue Code of 1986, as
amended.

            

    

    

    
      	
              4.

            	
              Committee shall
      mean a committee of two (2) or more non-employee Board members appointed
      by the Board to exercise one or more administrative functions under the
      Plan.

            

    

    

    
      	
              5. 

            	
              Common Stock
      shall mean the Corporation’s common
stock.

            

    

    

    
      	
              6.

            	
              Corporate
      Transaction shall mean either of the following shareholder approved
      transactions to which the Corporation is a
  party:

            

    

    

    (a)           a
merger or consolidation in which securities possessing more than fifty percent (50%) of the
total combined voting power of the Corporation’s outstanding securities are
transferred to a person or persons different from the persons holding those
securities immediately prior to such transaction, or

    

    (b)           the
sale, transfer or other disposition of all or substantially all of the
Corporation’s assets in complete liquidation or dissolution of the
Corporation.

    

    
      	
              7. 

            	
              Corporation
      shall mean Desert Hawk Gold Corp., a Nevada
  corporation.

            

    

    

    
      
        
           

        

        
          33

          
            

          

        

        
           

        

      

    

    

    
      	
              8. 

            	
              Exercise Price
      shall have the meaning assigned to such term in Section
    A.1.

            

    

    

    
      	
              9.

            	
              Fair Market
      Value per share of Common Stock on any relevant date shall be
      determined in accordance with the following
  provisions:

            

    

    

    (a)    If
the Common Stock is at the time traded on the NASDAQ National Market, then the
Fair Market Value shall be the closing selling price per share of Common Stock
on the date in question, as such price is reported by the National Association
of Securities Dealers on the NASDAQ National Market or any successor
system.  If there is no closing selling price for the Common Stock on
the date in question, then the Fair Market Value shall be the closing selling
price on the last preceding date for which such quotation exists.

    

    (b)           If
the Common Stock is at the time listed on any Stock Exchange, then the Fair
Market Value shall be the closing selling price per share of Common Stock on the
date in question on the Stock Exchange determined by the Plan Administrator to
be the primary market for the Common Stock, as such price is officially quoted
in the composite tape of transactions on such exchange.  If there is
no closing selling price for the Common Stock on the date in question, then the
Fair Market Value shall be the closing selling price on the last preceding date
for which such quotation exists.

    

    (c)           If
the Common Stock is at the time neither listed on any Stock Exchange nor traded
on the NASDAQ National Market, then the Fair Market Value shall be determined by
the Plan Administrator after taking into account such factors as the Plan
Administrator shall deem appropriate.

    

    
      	
              10.

            	
              Grant Date
      shall have the meaning assigned to such term in Section
    A.1.

            

    

    

    
      	
              11.

            	
              Grant Form
      shall mean the Grant of Stock Option pursuant to which Optionee has been
      informed of the basic terms of the
Option.

            

    

    

    
      	
              12.

            	
              Incentive
      Option shall mean an option which satisfies the requirements of
      Code Section 422.

            

    

    

    
      	
              13. 

            	
              1933 Act shall
      mean the Securities Act of 1933, as
amended.

            

    

    

    
      	
              14. 

            	
              1934 Act shall
      mean the Securities Exchange Act of 1934, as
  amended.

            

    

    

    
      	
              15.

            	
              Non-Statutory
      Option shall mean an option not intended to satisfy the
      requirements of Code Section 422.

            

    

    

    
      
        
           

        

        
          34

          
            

          

        

        
           

        

      

    

    

    
      	
              16. 

            	
              Option shall
      have the meaning assigned to such term in Section
  A.1.

            

    

    

    
      	
              17.

            	
              Option
      Agreement shall mean all agreements and other documents evidencing
      the Option.

            

    

    

    
      	
              18. 

            	
              Optionee shall
      mean the person to whom the Option is granted under the
    Plan.

            

    

    

    
      	
              19.

            	
              Parent shall
      mean any corporation (other than the Corporation) in an unbroken chain of
      corporations ending with the Corporation, provided each corporation in the
      unbroken chain (other than the Corporation) owns, at the time of the
      determination, stock possessing fifty percent (50%) or more of the total
      combined voting power of all classes of stock in one of the other
      corporations in such chain.

            

    

    

    
      	
              20. 

            	
              Plan shall mean
      the Corporation’s 2002 Stock Option/Stock Issuance
  Plan.

            

    

    

    
      	
              21.

            	
              Plan
      Administrator shall mean either the Board or the Committee acting
      in its capacity as administrator of the
Plan.

            

    

    

    
      	
              22. 

            	
              Purchased
      Shares shall have the meaning assigned to such term in Section
      A.1.

            

    

    

    
      	
              23.

            	
              Recapitalization
      shall mean any stock split, stock dividend, recapitalization, combination
      of shares, exchange of shares or other change affecting the Corporation’s
      outstanding Common Stock as a class without the Corporation’s receipt of
      consideration.

            

    

    

    
      	
              24. 

            	
              SEC shall mean
      the Securities and Exchange
Commission.

            

    

    

    
      	
              25.

            	
              Service shall
      mean the provision of services to the Corporation (or any Parent or
      Subsidiary) by a person in the capacity of an Employee, a non-employee
      member of the board of directors or a consultant or independent advisor,
      except to the extent otherwise specifically provided in the documents
      evidencing the option grant.

            

    

    

    
      	
              26.

            	
              Subsidiary
      shall mean any corporation (other than the Corporation) in an unbroken
      chain of corporations beginning with the Corporation, provided each
      corporation (other than the last corporation) in the unbroken chain owns,
      at the time of the determination, stock possessing fifty percent (50%) or
      more of the total combined voting power of all classes of stock in one of
      the other corporations in such
chain.

            

    

    

    
      	
              27.

            	
              Vesting
      Schedule shall mean the vesting schedule specified in the Grant
      Form pursuant to which the Optionee is to vest in the Option Shares in a
      series of installments over his or her period of
  Service.

            

    

    

    
      
        
           

        

        
          35

          
            

          

        

        
           

        

      

    

    

    THESE SECURITIES HAVE NOT BEEN
REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION BECAUSE
THEY ARE BELIEVED TO BE EXEMPT FROM REGISTRATION UNDER SECTION 4(2) AND/OR 4(6)
OF THE SECURITIES ACT OF 1933.

    

    THESE SECURITIES HAVE NOT BEEN APPROVED
OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION.  NEITHER THE
SECURITIES AND EXCHANGE COMMISSION NOR ANY OTHER AUTHORITY HAS PASSED UPON OR
ENDORSED THE MERITS OF THE OFFERING OR THE ACCURACY OR ADEQUACY OF THE
INFORMATION PROVIDED TO THE INVESTORS.  ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.  INVESTORS MUST RELY ON THEIR OWN
EXAMINATION OF THE COMPANY, AND THE RISKS, MERITS AND TERMS OF THIS OFFERING IN
MAKING AN INVESTMENT DECISION.

    

    DESERT
HAWK GOLD CORP.

    STOCK
ISSUANCE FORM

    

    This
Stock Issuance Form is furnished to the designated participant in the stock
issuance program of the 2008 Stock Option/Stock Issuance Plan of Desert Hawk
Gold Corp., an Nevada corporation (the “Corporation”):

    

    Participant:                                                                                                                    

    

    Issuance Date:                                                                                                                

    

    Number of Shares:                                                                                                         

    

    Consideration for
Shares:                                                                                            

    

    Vesting of Shares:                                                                                                          

    

    The
Participant understands and agrees that the stock is issued subject to and in
accordance with the terms of the Desert Hawk Gold Corp. 2008 Stock Option/Stock
Issuance Plan (the “Plan”).  The participant further agrees to be
bound by the terms of the Plan, a copy of which is attached hereto as
Exhibit A.

    

    All
capitalized terms in this Stock Issuance Form shall have the meaning assigned to
them in this form or in the attached Plan.

    

    
      
        
           

        

        
          36

          
            

          

        

        
           

        

      

    

    

    Assuming
that you are in agreement with the terms of this Stock Issuance Form, please
sign your name in the space indicated below.

    

    
      
        	 
      	
                Deseret
      Hawk Gold Corp.

              
	 
      	 
      	 
      
	 
      	
                By: 
      

              	 
      
	 
      	 
      	
                Robert
      E. Jorgensen, CEO

              

      

    

    

    AGREED:

    

    ____________________________________

    Participant

    

    Address:                                                                

    

    Exhibit
A         2008 Stock Option/Stock
Issuance Plan

    

    
      
        
           

        

        
          37Unassociated Document

    EXECUTION
VERSION

    
      
        
          	
                   

                	
                   

                

        
 

    

    REGISTRATION
RIGHTS AGREEMENT

    

    dated
as of July 14, 2010

    

    by
and between

    

    DESERT
HAWK GOLD CORP.

    

    and

    

    DMRJ
GROUP I, LLC

    
      
        	
                 

              	
                 

              

      

    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    TABLE OF
CONTENTS

    

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          	
                                                  1.

                                                	
                                                  Definitions

                                                	 
      	
                                                  1

                                                
	 
      	 
      	 
      	 
      
	
                                                  2.

                                                	
                                                  Demand
      Registration

                                                	 
      	
                                                  3

                                                
	 
      	
                                                  2.1

                                                	
                                                  Long-Form
      Registrations

                                                	 
      	
                                                  3

                                                
	 
      	
                                                  2.2

                                                	
                                                  Short-Form
      Registrations

                                                	 
      	
                                                  3

                                                
	 
      	
                                                  2.3

                                                	
                                                  Effective
      Registrations

                                                	 
      	
                                                  4

                                                
	 
      	
                                                  2.4

                                                	
                                                  Priority

                                                	 
      	
                                                  4

                                                
	 
      	
                                                  2.5

                                                	
                                                  Underwritten
      Demand Registrations

                                                	 
      	
                                                  5

                                                
	 
      	
                                                  2.6

                                                	
                                                  Deferral

                                                	 
      	
                                                  5

                                                
	 
      	
                                                  2.7

                                                	
                                                  Limits

                                                	 
      	
                                                  6

                                                
	 
      	 
      	 
      	 
      	 
      
	
                                                  3.

                                                	
                                                  Piggyback
      Registration

                                                	 
      	
                                                  6

                                                
	 
      	
                                                  3.1

                                                	
                                                  Right
      to Piggyback

                                                	 
      	
                                                  6

                                                
	 
      	
                                                  3.2

                                                	
                                                  Priority
      on Primary Registrations

                                                	 
      	
                                                  6

                                                
	 
      	
                                                  3.3

                                                	
                                                  Priority
      on Secondary Registrations

                                                	 
      	
                                                  7

                                                
	 
      	
                                                  3.4

                                                	
                                                  Other
      Registrations

                                                	 
      	
                                                  7

                                                
	 
      	
                                                  3.5

                                                	
                                                  Underwritten
      Piggyback Registrations

                                                	 
      	
                                                  7

                                                
	 
      	
                                                  3.6

                                                	
                                                  Limitations
      on Registrations

                                                	 
      	
                                                  8

                                                
	 
      	 
      	 
      	 
      	 
      
	
                                                  4.

                                                	
                                                  Holdback
      Agreements

                                                	 
      	
                                                  8

                                                
	 
      	
                                                  4.1

                                                	
                                                  Holders’
      Agreements

                                                	 
      	
                                                  8

                                                
	 
      	
                                                  4.2

                                                	
                                                  Corporation’s
      Agreements

                                                	 
      	
                                                  9

                                                
	 
      	 
      	 
      	 
      	 
      
	
                                                  5.

                                                	
                                                  Registration
      Procedures, etc

                                                	 
      	
                                                  9

                                                
	 
      	
                                                  5.1

                                                	
                                                  Registration
      Procedures Generally

                                                	 
      	
                                                  9

                                                
	 
      	 
      	 
      	 
      	 
      
	
                                                  6.

                                                	
                                                  Registration
      Expenses

                                                	 
      	
                                                  12

                                                
	 
      	
                                                  6.1

                                                	
                                                  Corporation’s
      Expenses

                                                	 
      	
                                                  12

                                                
	 
      	
                                                  6.2

                                                	
                                                  Holder’s
      Expenses

                                                	 
      	
                                                  12

                                                
	 
      	 
      	 
      	 
      	 
      
	
                                                  7.

                                                	
                                                  Indemnification

                                                	 
      	
                                                  13

                                                
	 
      	
                                                  7.1

                                                	
                                                  By
      the Corporation

                                                	 
      	
                                                  13

                                                
	 
      	
                                                  7.2

                                                	
                                                  By
      Each Holder

                                                	 
      	
                                                  13

                                                
	 
      	
                                                  7.3

                                                	
                                                  Procedure

                                                	 
      	
                                                  14

                                                
	 
      	
                                                  7.4

                                                	
                                                  Contribution

                                                	 
      	
                                                  14

                                                
	 
      	
                                                  7.5

                                                	
                                                  Survival
      and Remedies

                                                	 
      	
                                                  15

                                                
	 
      	 
      	 
      	 
      	 
      
	
                                                  8.

                                                	
                                                  Compliance
      with Rule 144

                                                	 
      	
                                                  15

                                                
	 
      	 
      	 
      	 
      	 
      
	
                                                  9.

                                                	
                                                  Participation
      in Underwritten Registrations

                                                	 
      	
                                                  15

                                                
	 
      	 
      	 
      	 
      	 
      
	
                                                  10.

                                                	
                                                  Miscellaneous

                                                	 
      	
                                                  16

                                                
	 
      	
                                                  10.1

                                                	
                                                  No
      Inconsistent Agreements

                                                	 
      	
                                                  16

                                                

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    
      
        
        

      

      
        i

        
          

        

      

      
        
        

      

    

     

    
      
        	 
      	
                10.2

              	
                Adjustments
      Affecting Registrable Shares

              	 
      	
                16

              
	 
      	
                10.3

              	
                Other
      Registration Rights

              	 
      	
                16

              
	 
      	
                10.4

              	
                Remedies

              	 
      	
                16

              
	 
      	
                10.5

              	
                Amendments
      and Waivers

              	 
      	
                16

              
	 
      	
                10.6

              	
                Successors
      and Assigns

              	 
      	
                16

              
	 
      	
                10.7

              	
                Severability

              	 
      	
                17

              
	 
      	
                10.8

              	
                Descriptive
      Headings

              	 
      	
                17

              
	 
      	
                10.9

              	
                Notices

              	 
      	
                17

              
	 
      	
                10.10

              	
                Jurisdiction,
      Etc

              	 
      	
                18

              
	 
      	
                10.11

              	
                Governing
      Law

              	 
      	
                18

              
	 
      	
                10.12

              	
                WAIVER
      OF JURY TRIAL

              	 
      	
                18

              
	 
      	 
      	 
      	 
      	 
      
	
                11.

              	
                Final
      Agreement

              	 
      	
                18

              
	 
      	 
      	 
      	 
      	 
      
	
                12.

              	
                Execution
      in Counterparts

              	 
      	
                19

              
	 
      	 
      	 
      	 
      	 
      
	
                13.

              	
                No
      Strict Construction

              	 
      	
                19

              

      

    

     

    
      
         

      

      
        ii

        
          

        

      

      
         

      

    

    

      DESERT
HAWK GOLD CORP.

       

      REGISTRATION RIGHTS
AGREEMENT

       

      This
REGISTRATION RIGHTS
AGREEMENT, dated as of July 14, 2010 (this “Agreement”), is by
and between Desert Hawk Gold Corp., a Nevada corporation (the “Corporation”), and
DMRJ Group I, LLC, a Delaware limited liability company (the “Investor”).

       

      A.           This
Agreement is made in connection with that certain Investment Agreement, dated as
of the date hereof, by and between the Corporation and the Investor (as amended,
amended and restated, modified or supplemented from time to time in accordance
with the terms thereof, the “Investment
Agreement”), pursuant to which the Investor has agreed to make available
to the Corporation a senior secured term loan credit facility of up to
$6,500,000.

       

      B.           As
an inducement to the Investor to enter into the Investment Agreement and to make
available the credit facility thereunder, the Corporation (i) has issued to
the Investor 958,033 shares of Series A Convertible Preferred Stock, par value
$0.001 per share, of the Corporation (the “Series A Preferred
Shares”) in exchange for payment therefor as set forth in the Investment
Agreement, and (ii) has agreed to enter into this Agreement in order to
grant certain registration rights to the Investor with respect to the shares of
Common Stock issuable upon conversion of the Series A Preferred Shares as set
forth below.

       

      In
consideration of the premises and the mutual covenants contained herein, and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:

       

      1.           Definitions.  In
addition to capitalized terms defined elsewhere in this Agreement, the following
capitalized terms shall have the following respective meanings when used in this
Agreement and shall be equally applicable to both the singular and plural forms
of the terms defined herein:

       

      “Agreement” has the
meaning set forth in the Preamble.

       

      “Business Day” means a
day of the year on which banks are not required or authorized by law to close in
New York City.

       

      “Commission” means the
Securities and Exchange Commission.

       

      “Common Stock” means
the Common Stock, $0.001 par value per share, of the Corporation.

       

      “Corporation” has the
meaning set forth in the Preamble.

       

      “Delay Period” has the
meaning set forth in Section
2.6.

       

      “Demand Registrations”
has the meaning set forth in Section
2.2.

       

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

       

      “Demand Registration
Statement” has the meaning set forth in Section
2.3.

       

      “Exchange Act” means
the Securities Exchange Act of 1934, as amended.

       

      “Initiating Holders”
has the meaning set forth in Section
2.5.

       

      “Investment Agreement”
has the meaning set forth in Recital A.

       

      “Investor” has the
meaning set forth in the Preamble.

       

      “Lock-Up Period” has
the meaning set forth in Section
4.1.

       

      “Long-Form Demand
Registrations” has the meaning set forth in Section
2.1.

       

      “Person” means an
individual, a partnership (general, limited or limited liability), a
corporation, a limited liability company, an association, a joint stock company,
a trust, a joint venture, an unincorporated organization or other entity, or a
governmental entity or any department, agency or political subdivision
thereof.

       

      “Piggyback
Registration” has the meaning set forth in Section
3.1.

       

      “Preferred Shares”
means the Series A Preferred Shares.

       

      “Previously Designated
Registrable Shares” means the shares of Common Stock to which the
Previously Granted Registration Rights are applicable.

       

      “Previously Granted
Registration Rights” has the meaning set forth in Section
3.6(b).

       

      “Registrable Shares”
means at any time (i) any shares of Common Stock then outstanding which
were issued upon conversion of the Preferred Shares; (ii) any shares of
Common Stock then issuable upon conversion of the outstanding Preferred Shares;
(iii) any shares of Common Stock or other securities then outstanding which
were issued as, or were issued directly or indirectly upon the conversion or
exercise of other securities issued as, a dividend or other distribution with
respect to, in exchange for or in replacement of any shares referred to in
clauses (i) and (ii); and (iv) any shares of Common Stock or other
securities then issuable directly or indirectly upon the conversion or exercise
of other securities which were issued as a dividend or other distribution with
respect to, in exchange for or in replacement of any shares referred to in
clauses (i) and (ii); provided, however, that
Registrable Shares shall not include any shares which have been sold pursuant to
an offering registered under the Securities Act or which have been sold to the
public pursuant to Rule 144 under the Securities Act.  For purposes of
this Agreement, a Person will be deemed to be a holder of Registrable Shares
whenever such Person has the right to acquire such Registrable Shares, whether
or not such acquisition actually has been effected.

       

      “Registration
Expenses” has the meaning set forth in Section
6.1.

       

      “Registration Period”
has the meaning set forth in Section
5.1(b).

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      “Securities Act” means
the Securities Act of 1933, as amended.

       

      “Series A Preferred
Shares” has the meaning set forth in Recital B.

       

      “Short-Form Demand
Registrations” has the meaning set forth in Section
2.2.

       

      2.           Demand
Registration.

       

      2.1           Long-Form
Registrations.  Subject to the terms of this Agreement, the
holders of at least thirty-three percent (33%) of the then outstanding
Registrable Shares may, at any time after the earlier of (i) the first
anniversary of the date hereof and (ii) one hundred eighty (180) days after
an initial public offering of the Corporation’s securities under the Securities
Act, request registration (which may include a shelf registration) under the
Securities Act of all or part of their Registrable Shares on Form S-1 or any
similar long-form registration.  Within ten (10) days after receipt of
any request pursuant to this Section 2.1, the
Corporation will give written notice of such request to all other holders of
Registrable Shares and will include in such registration all Registrable Shares
with respect to which the Corporation has received written requests for
inclusion within fifteen (15) days after delivery of the Corporation’s
notice.  All registrations requested pursuant to this Section 2.1 are
referred to herein as “Long-Form Demand
Registrations.”  The Corporation is obligated to effect no more
than two (2) Long-Form Demand Registrations unless the Corporation is unable to
use a Form S-3 (or any similar short form registration) at any time after the
Corporation would otherwise be eligible to use a Form S-3 (or any similar short
form registration) because (i) the Corporation has not filed all of the
material to be filed pursuant to Section 13, 14 or 15(d) of the Exchange Act for
a period of at least twelve (12) calendar months immediately preceding the date
the requested registration statement would be filed in accordance with this
Agreement; (ii) the Corporation has not filed in a timely manner all
reports required to be filed during the twelve (12) calendar months and portion
of a month immediately preceding the date the requested registration statement
would be filed in accordance with this Agreement; (iii) if the Corporation
has used (during the twelve (12) calendar months and any portion of a month
immediately preceding the date the requested registration statement would be
filed in accordance with this Agreement) Rule 12b-25(b) of the Exchange Act with
respect to a report or a portion of a report, the Corporation failed to file
that report or portion thereof within the time period prescribed by such rule,
or (iv) the Corporation or any of its subsidiaries, since the end of the last
fiscal year for which certified financial statements thereof were included in a
report filed pursuant to Section 13(a) or 15(d) of the Exchange Act (A) failed
to pay any dividend or sinking fund installment on preferred stock of the
Corporation or (B) defaulted on (I) any installment or installments on
indebtedness for borrowed money or (II) on any rental on one or more long-term
leases, which defaults in the aggregate are material to the financial position
of the Corporation and its subsidiaries, taken as a whole.

       

      2.2           Short-Form
Registrations.  In addition to the Long-Form Registrations
provided pursuant to Section 2.1 above,
the holder or holders of Registrable Shares proposing to sell Registrable Shares
with an expected aggregate offering price to the public of at least $500,000
will be entitled to request from time to time registrations under the Securities
Act of all or part of their Registrable Shares on Form S-3 or any similar
short-form registration (“Short-Form Demand
Registrations”, and, together with Long-Form Demand Registrations, the
“Demand
Registrations”), if available; provided, however, that the
Corporation shall not be obligated to effect more than two (2) Short-Form Demand
Registrations in any twelve (12) month period.  Within ten (10) days
after receipt of any request pursuant to this Section 2.2, the
Corporation will give written notice of such request to all other holders of
Registrable Shares and will include in such registration all Registrable Shares
with respect to which the Corporation has received written requests for
inclusion within fifteen (15) days after delivery of the Corporation’s
notice.  Demand Registrations will be Short-Form Demand Registrations
whenever the Corporation is permitted to use any applicable short
form.  Once the Corporation has become subject to the reporting
requirements of the Exchange Act, the Corporation will use its reasonable
efforts to make Short-Form Demand Registrations available for the sale of
Registrable Shares.  If a Short-Form Demand Registration is to be an
underwritten public offering, and if the underwriters for marketing or other
reasons request the inclusion in the registration statement of information which
is not required under the Securities Act to be included in a registration
statement on the applicable form for the Short-Form Demand Registration, the
Corporation will provide such information as may be reasonably requested for
inclusion by the underwriters in the Short-Form Demand
Registration.

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      2.3           Effective
Registrations.  The Corporation shall use its commercially
reasonable efforts to maintain the effectiveness of a registration statement
filed with respect to any Demand Registration (a “Demand Registration
Statement”) at all times during the Registration Period (as defined
below).  A Demand Registration shall not be deemed to have been
effected and count as a Demand Registration described in Sections 2.1 and
2.2 unless a
Demand Registration Statement with respect thereto has become effective and
remains effective at all times during the Registration Period, unless such
registration statement shall be withdrawn at the request of the holders
requesting such registration.

       

      2.4           Priority.  The
Corporation will not include in any Demand Registration any securities which are
not Registrable Shares or Previously Designated Registrable Shares without the
written consent of the holders of a majority of the Registrable Shares to be
included in such Demand Registration.  If a Demand Registration is an
underwritten public offering and the managing underwriters advise the
Corporation in writing that in their opinion the number of securities requested
to be included in the registration creates a substantial risk of adversely
affecting the marketability of the offering, the Corporation will include in
such registration such number of securities that in the written opinion of such
underwriters can be sold without creating such a risk in the following order of
priority:  first, the Registrable Shares
and Previously Designated Registrable Shares requested to be included in such
registration, pro rata among the
respective holders of Registrable Shares and Previously Designated Registrable
Shares on the basis of the number of Registrable Shares or Previously Designated
Registrable Shares owned by such holders, with further successive pro rata allocations
among the holders of Registrable Shares and Previously Designated Registrable
Shares if any such holder of Registrable Shares or Previously Designated
Registrable Shares has requested the registration of less than all such
Registrable Shares or Previously Designated Registrable Shares such holder is
entitled to register, and second, if and to the extent
the holders of a majority of the Registrable Shares have consented in writing to
the inclusion of any other securities, such other securities requested to be
included in such registration.

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

      2.5           Underwritten Demand
Registrations.  If the holders of Registrable Shares initiating
a Demand Registration hereunder (the “Initiating Holders”)
intend to distribute the Registrable Shares covered by their request by means of
an underwritten public offering, they shall so advise the Corporation as a part
of a request made pursuant to Sections 2.1 and
2.2 and the
Corporation shall include such information in its written notices referred to in
Sections 2.1
and 2.2.  The
holders of a majority of the Registrable Shares included in any Demand
Registration shall have the right to select the investment banker(s) and
manager(s) to administer the offering, subject to the Corporation’s approval,
which approval shall not be unreasonably withheld or delayed.  In such
event, the right of any holder of Registrable Shares to include such holder’s
Registrable Shares in such registration shall be conditioned upon such holder’s
participation in such underwriting and the inclusion of such holder’s
Registrable Shares in the underwriting to the extent provided
herein.  The Corporation and all holders of Registrable Shares
proposing to distribute their Registrable Shares through such underwriting shall
enter into an underwriting agreement in customary form with the underwriter or
underwriters selected for such underwriting.

       

      2.6           Deferral.  The
Corporation shall be entitled to postpone the filing of any Demand Registration
Statement otherwise required to be prepared and filed by the Corporation
pursuant to Section
2.1 or 2.2, delay a request
for effectiveness of any such Demand Registration Statement, or suspend the use
of any effective Demand Registration Statement filed with respect to any Demand
Registration, for a reasonable period of time, but not in excess of thirty (30)
days (a “Delay
Period”), if the board of directors of the Corporation determines that,
in its good faith judgment, the registration and distribution of the Registrable
Shares covered or to be covered by such Demand Registration Statement would
require the disclosure of material, non-public information by the Corporation in
the Demand Registration Statement with respect to which the board of directors
of the Corporation believes that the Corporation has a bona fide business
purpose for preserving confidentiality, and the Corporation promptly gives the
Initiating Holders a written certificate signed by an executive officer of the
Corporation notifying such Initiating Holders of such determination and an
approximation of the period of the anticipated delay; provided, however, that the
Corporation shall not have the right to initiate more than one (1) Delay Period
in any six (6) month period.  If the Corporation shall so postpone the
filing of a Demand Registration Statement, the Initiating Holders shall have the
right to withdraw such Initiating Holders’ request for the applicable Demand
Registration by giving written notice thereof to the Corporation within thirty
(30) days after receipt of the notice of postponement, and, in the event of such
withdrawal, such request shall not be counted for purposes of determining the
number of Demand Registrations which the Corporation is obligated to effect
pursuant to Sections
2.1 and 2.2.  The
time period for which the Corporation is required to maintain the effectiveness
of any Demand Registration Statement shall be extended by the aggregate number
of days of the applicable Delay Period during such registration.  The
Corporation shall not be entitled to initiate a Delay Period unless it shall
(i) to the extent permitted by agreements with other security holders of
the Corporation, concurrently prohibit sales by such other security holders
under registration statements covering securities held by such other security
holders, and (ii) in accordance with the Corporation’s policies from time
to time in effect, forbid purchases and sales in the open market by directors
and executive officers of the Corporation during such Delay Period.

       

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

       

      2.7           Limits.  The
Corporation shall not be obligated to prepare and file, and the Corporation
shall be permitted to delay or abandon, a registration statement with respect to
any Registrable Shares of any holder thereof if all such Registrable Shares of
such holder may then be sold pursuant to Rule 144 of the Securities Act without
restriction or limitation (including, without limitation, imposed by the volume
or manner of offering restrictions) and without public information requirements;
provided, however, that in no
event shall the registration rights granted under this Agreement terminate any
time prior to the second anniversary of the date of the Corporation’s initial
public offering of securities under the Securities Act.

       

      3.           Piggyback
Registration.

       

      3.1           Right to
Piggyback.  Whenever the Corporation proposes to register any
of its securities under the Securities Act (other than pursuant to a Demand
Registration hereunder) in connection with the public offering of such
securities, whether or not for sale for its own account (other than a
registration relating solely to the sale of securities issued to employees,
directors and consultants of the Corporation under an employee benefit plan on
Form S-8 or similar form which may be promulgated in the future, or a
registration relating solely to securities issued to effect a business
combination pursuant to Rule 145 promulgated under the Securities Act on Form
S-4 or similar form which may be promulgated in the future), and the
registration form to be used may be used for the registration of any Registrable
Shares (a “Piggyback
Registration”), the Corporation will give prompt written notice (and in
any event at least thirty (30) days prior to filing any registration statement
with respect to such Piggyback Registration or, in the case of any demand
registration other than a Demand Registration under this Agreement, within five
(5) Business Days after its receipt of notice of any exercise of such demand
registration rights) to all holders of the Registrable Shares of its intention
to effect such a registration and will include in such registration all
Registrable Shares (in accordance with the priorities set forth in Section 3.2 below)
with respect to which the Corporation has received written requests for
inclusion within thirty (30) days after the delivery of the Corporation’s
notice.  The Corporation shall use its commercially reasonable efforts
to maintain the effectiveness of a registration statement filed with respect to
any Piggyback Registration at all times during the Registration
Period.  No Piggyback Registration effected under this Section 3.1 shall
relieve the Corporation of its obligation to effect any Demand Registration
under Sections
2.1 and 2.2, nor shall any
Piggyback Registration be deemed to have been effected pursuant to Sections 2.1 and
2.2.  There
shall be no limit on the number of times the holders of Registrable Shares may
request Piggyback Registration of Registrable Shares under this Section
3.1.

       

      3.2           Priority on Primary
Registrations.  If a Piggyback Registration is an underwritten
public offering (other than a secondary registration of securities held solely
by stockholders of the Corporation, as to which Section 3.3 shall
apply) and the managing underwriters advise the Corporation in writing that in
their opinion the number of securities requested to be included in the
registration creates a substantial risk of adversely affecting the marketability
of the offering, the Corporation will include in such registration such number
of securities that in the written opinion of such underwriters can be sold
without creating such a risk in the following order of
priority:  first, the securities that
the Corporation proposes to sell, if any, second, (i) the securities
requested to be included therein by the holders initiating such registration, if
any, (ii) the Registrable Shares requested to be included in such registration,
and (iii) the Previously Designated Registrable Shares requested to be included
in such registration, pro rata among the
holders of such securities on the basis of the number of shares of such
securities being so requested for inclusion in such registration which are owned
by such holders (and pro rata among the
respective holders of Registrable Shares on the basis of the number of
Registrable Shares owned by such holders, with further successive pro rata allocations
among the holders of Registrable Shares if any such holder of Registrable Shares
has requested the registration of less than all such Registrable Shares such
holder is entitled to register), and third, other securities
requested to be included in such registration; provided that,
notwithstanding the priority allocations set forth in this Section 3.2, the
amount of Registrable Shares included in a registered offering shall not be
reduced below twenty-five percent (25%) of the total amount of securities
included in such offering, unless (i) such offering is the initial public
offering of the Corporation’s securities, in which case all Registrable Shares
may be excluded if the underwriters make the determination described above and
no other stockholder’s securities are included, or (ii) the inclusion of
Previously Designated Registrable Shares in the offering as provided for in this
Section 3.2
causes the  amount of Registrable Shares included in a registered
offering to be reduced below twenty-five percent (25%) of the total amount of
securities included in such offering.

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

       

      3.3           Priority on Secondary
Registrations.  If a Piggyback Registration is an underwritten
secondary registration on behalf of holders of the Corporation’s securities, and
the managing underwriters advise the Corporation in writing that in their
opinion the number of securities requested to be included in such registration
exceeds the number which can be sold in such offering without adversely
affecting the marketability of the offering, the Corporation shall include in
such registration such number of securities that in the written opinion of such
underwriter can be sold without creating such a risk in the following order of
priority:  first, the securities
requested to be included therein by the holders requesting such registration and
the Registrable Shares requested to be included in such registration, and to the
extent required, the Previously Designated Registrable Shares requested to be
included in such registration, pro rata among the
holders of such securities on the basis of the number of securities so requested
to be included therein owned by each such holder, and second, other securities
requested to be included in such registration.

       

      3.4           Other
Registrations.  If the Corporation has previously filed a
registration statement with respect to Registrable Shares pursuant to Section 2 or pursuant
to this Section
3, and if such previous registration has not been withdrawn or abandoned,
the Corporation will not file or cause to be effected any other registration of
any of its equity securities or securities convertible or exchangeable into or
exercisable for its equity securities under the Securities Act (except on Form
S-8 or any successor form), whether on its own behalf or at the request of any
holder or holders of such securities, until a period of at least one hundred
twenty (120) days has elapsed from the effective date of such previous
registration.

       

      3.5           Underwritten Piggyback
Registrations.  If the securities registered in any Piggyback
Registration are to be distributed by means of an underwritten public offering,
the Corporation shall include such information in the written notice referred to
in Section
3.1.  If any holder of Registrable Shares elects to participate
in such underwritten Piggyback Registration, each such holder shall enter into
an underwriting agreement in customary form with the underwriter or underwriters
selected for such underwriting, which underwriting agreement shall also be
entered into by the Corporation and the holders initiating such Piggyback
Registration.  Any investment banker(s) and manager(s) selected to
administer the offering shall be subject to the prior approval of holders of a
majority of the Registrable Shares, which approval shall not be unreasonably
withheld or delayed.

       

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

       

      3.6           Limitations on
Registrations.

       

      (a)           The
Corporation shall not register any of its securities for sale for its own
account (other than securities issued to employees, directors and consultants of
the Corporation under an employee benefit plan registered on Form S-8 or similar
form which may be promulgated in the future, or securities issued to effect a
business combination pursuant to Rule 145 promulgated under the Securities Act
registered on Form S-4 or similar form which may be promulgated in the future
and other than a shelf registration on Form S-3 (but not including any sale of
securities “pulled down” from such shelf registration)) except as a firm
commitment underwriting.

       

      (b)           Without
limiting any provision contained in the Corporation’s articles of incorporation,
the Corporation shall not, without the separate prior written approval
of the holder or the holders of a majority of the Registrable Shares, grant
or award to any Person any registration rights with respect to, or otherwise
register on behalf of any Person (other than the Corporation), any securities of
the Corporation, except for (i) the registration rights granted hereunder,
(ii) registrations of Registrable Shares, securities issued to employees,
directors and consultants of the Corporation under an employee benefit plan
registered on Form S-8 or similar form which may be promulgated in the future,
and securities issued to effect a business combination pursuant to Rule 145
promulgated under the Securities Act registered on Form S-4 or similar form
which may be promulgated in the future, and (iii) such piggyback
registration rights as have been previously granted by the Corporation and
remain in effect as of the date hereof, which outstanding piggyback registration
rights are described in reasonable detail (including the name of the holder of
such rights, number of securities eligible for registration, grant and expiry
date of such rights, and general terms of such rights) on Schedule 3.6(b)
hereof (the “Previously Granted
Registration Rights”).

       

      4.           Holdback
Agreements.

       

      4.1           Holders’
Agreements.  Each holder of Registrable Shares agrees not to
effect any public sale or distribution (including pursuant to Rule 144) of
equity securities of the Corporation, or any securities convertible into or
exchangeable or exercisable for such securities, during the 180-day period
beginning on the effective date of any initial public offering of securities
pursuant to a firmly underwritten offering registered under the Securities Act
(the “Lock-Up
Period”), unless (a) the underwriters managing the registered public
offering otherwise agree, or (b) directors, officers and other senior
management of the Corporation (or any holder of Previously Granted Registration
Rights) do not agree to the same restrictions in this Section
4.1.  Nothing herein shall prevent a holder of Registrable
Shares, during the Lock-Up Period, (i) from exercising its Piggyback
Registration rights pursuant to Section 3.1,
(ii) from putting securities of the Corporation in a trust, gifting such
securities, or selling or distributing securities of the Corporation that were
acquired on the open market, (iii) that is a partnership from making a
distribution of securities of the Corporation to its partners, (iv) that is
a limited liability company from making a distribution of securities of the
Corporation to its members, (v) that is a trust from making a distribution
of securities of the Corporation to its beneficiaries, or (vi) that is a
corporation from making a distribution of securities of the Corporation to its
stockholders, provided that the
transferees of such securities of the Corporation agree to be bound by the
provisions of this Agreement to the extent the transferor would be so
bound.

       

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

       

      4.2           Corporation’s
Agreements.  The Corporation agrees not to file a registration
statement with respect to any public sale or distribution of its equity
securities, or any securities convertible into, or exchangeable or exercisable
for, such securities, during the seven (7) days prior to and during the 180-day
period beginning on the effective date of any underwritten Demand Registration
or any underwritten Piggyback Registration (except as part of such underwritten
registration or pursuant to registrations on Form S-8 or any successor form),
unless the underwriters managing the underwritten Demand Registration or
Piggyback Registration otherwise agree.

       

      5.           Registration Procedures,
etc.

       

      5.1           Registration Procedures
Generally.  Whenever the holders of Registrable Shares have
requested that any Registrable Shares be registered pursuant to this Agreement,
the Corporation will use its reasonable best efforts to effect the registration
and sale of such Registrable Shares in accordance with the intended method of
disposition thereof and, pursuant thereto, the Corporation will as expeditiously
as possible:

       

      (a)           prepare
and file with the Commission a registration statement on the applicable form in
accordance with the terms hereof with respect to such Registrable Shares and use
its reasonable best efforts to cause such registration statement to become
effective as soon as expeditiously possible thereafter (provided that before
filing a registration statement or prospectus, or any amendments or supplements
thereto, the Corporation will furnish copies of all such documents proposed to
be filed to the counsel or counsels for the sellers of the Registrable Shares
covered by such registration statement);

       

      (b)           prepare
and file with the Commission such amendments and supplements to such
registration statement and the prospectus(es) used in connection therewith as
may be necessary to keep such registration statement effective until the earlier
of (i) the date on which all remaining Registrable Shares covered by such
registration statement may be sold pursuant to Rule 144 without volume
restrictions or public information requirements and any and all restrictive
legends have been removed from such Registrable Shares and (ii) when all
Registrable Shares covered by such registration statement have been disposed of
pursuant to such registration statement or otherwise cease to be Registrable
Shares (the “Registration
Period”), and comply with the provisions of the Securities Act with
respect to the disposition of all securities covered by such registration
statement during such Registration Period in accordance with the intended
methods of disposition by the sellers thereof set forth in such registration
statement;

       

      (c)           furnish
to each seller of Registrable Shares such number of copies of such registration
statement, each amendment and supplement thereto, the prospectus(es) included in
such registration statement (including each preliminary prospectus) and such
other documents as such seller may reasonably request in order to facilitate the
disposition of the Registrable Shares owned by such seller;

       

      (d)           use
its reasonable best efforts to register or qualify such Registrable Shares under
such other securities or “blue sky” laws of such jurisdictions in the United
States of America as any seller of Registrable Shares reasonably requests and do
any and all other acts and things which may be reasonably necessary or advisable
to enable such seller to consummate the disposition in such jurisdictions of the
Registrable Shares owned by such seller (provided that the
Corporation will not be required to (i) qualify generally to do business in any
jurisdiction where it would not otherwise be required to qualify but for this
subparagraph or (ii) consent to general service of process in any such
jurisdiction);

       

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

       

      (e)           promptly
notify each seller of such Registrable Shares (i) when a registration
statement, prospectus or any supplement or amendment thereto has been filed,
and, with respect to such registration statement or any post-effective amendment
thereto, when the same has become effective, (ii) of any request by the
Commission for amendments or supplements to a registration statement or a
prospectus related thereto or for additional information, (iii) of the
issuance by the Commission of any stop order suspending the effectiveness of a
registration statement or the initiation of any proceedings by any Person for
such purpose, (iv) of the receipt by the Corporation of any notification
with respect to the suspension of the qualification of any Registrable Shares
for sale under the securities or “blue sky” laws of any jurisdiction or the
initiation of any proceedings for such purpose, and (v) of the happening of
any event as a result of which the prospectus included in any registration
statement related thereto contains an untrue statement of a material fact or
omits any fact necessary to make the statements therein not misleading, and the
Corporation will promptly prepare and file with the Commission a supplement or
amendment to such registration statement or such prospectus so that, as
thereafter delivered to the purchasers of such Registrable Shares, such
prospectus will not contain any untrue statement of a material fact or omit to
state any fact necessary to make the statements therein not
misleading;

       

      (f)           cause
all such Registrable Shares to be listed on each securities exchange or market
on which similar securities issued by the Corporation are then
listed;

       

      (g)           provide
a transfer agent and registrar for all such Registrable Shares not later than
the effective date of such registration statement;

       

      (h)           if
any Registrable Shares registered in any Demand Registration or Piggyback
Registration are to be distributed by means of an underwritten public offering,
enter into such customary agreements (including underwriting agreements in
customary form) and take all such other customary actions as the holders of a
majority of the Registrable Shares being sold or the underwriters, if any,
reasonably request in order to expedite or facilitate the disposition of such
Registrable Shares (including, but not limited to, providing marketing support,
including presentations by members of senior management, as is reasonably
requested by holders of Registrable Shares participating in the offering to
facilitate the success of the offering);

       

      (i)           make
available for inspection by any seller of Registrable Shares, any underwriter
participating in any disposition pursuant to such registration statement, and
any attorney, accountant or other agent retained by any such seller or
underwriter, all financial and other records, pertinent corporate documents and
properties of the Corporation, and cause the Corporation’s officers, directors,
employees and independent accountants to supply all information reasonably
requested by any such seller, underwriter, attorney, accountant or agent in
connection with such registration statement;

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

       

      (j)           advise
each seller of such Registrable Shares, promptly after it shall receive notice
or obtain knowledge thereof, of the issuance of any stop order by the Commission
suspending the effectiveness of such registration statement or the initiation or
threatening of any proceeding for such purpose and promptly use all reasonable
efforts to prevent the issuance of any stop order or to obtain its withdrawal if
such stop order should be issued;

       

      (k)           at
least forty-eight (48) hours prior to the filing of any registration statement
or prospectus, or any amendment or supplement to such registration statement or
prospectus, or any response to any Commission comment letter with respect to
such registration statement or prospectus, furnish a copy thereof to each seller
of such Registrable Shares and refrain from filing any such registration
statement, prospectus, amendment or supplement, and from transmitting any
response to a Commission comment letter, to which counsel selected by the
holders of a majority of the Registrable Shares being registered shall have
reasonably objected;

       

      (l)           if
requested by a holder of Registrable Shares, (i) incorporate in a
prospectus supplement or post-effective amendment such information as such
holder requests to be included therein relating to the sale and distribution of
Registrable Shares, including, without limitation, information with respect to
the number of Registrable Shares being offered or sold, the purchase price being
paid therefor, the Persons selling the Registrable Shares and any other terms of
the offering of the Registrable Shares, (ii) make all required filings of
such prospectus supplement or post-effective amendment as soon as notified of
the matters to be incorporated in such prospectus supplement or post-effective
amendment, and (iii) supplement or make amendments to any registration
statement related thereto if requested by a holder of such Registrable
Shares;

       

      (m)           make
generally available to its security holders as soon as practical, but not later
than ninety (90) days after the close of the period covered thereby, an earnings
statement (in form complying with the provisions of Rule 158 under the
Securities Act) covering a twelve-month period beginning not later than the
first day of the Corporation’s fiscal quarter next following the effective date
of any registration statement related to Registrable Shares; and

       

      at the
request of any seller of such Registrable Shares in connection with an
underwritten offering, furnish on the date or dates provided for in the
underwriting agreement:  (i) an opinion of counsel, addressed to
the underwriters and the sellers of Registrable Shares, covering such matters as
such counsel, underwriters and sellers may reasonably agree upon, including such
matters as are customarily furnished in connection with an underwritten
offering, and (ii) a letter or letters from the independent certified
public accountants of the Corporation addressed to the underwriters and the
sellers of Registrable Shares, covering such matters as such accountants,
underwriters and sellers may reasonably agree upon, in which letter(s) such
accountants shall state, without limiting the generality of the foregoing, that
they are independent certified public accountants within the meaning of the
Securities Act and that in their opinion the financial statements and other
financial data of the Corporation included in the registration statement, the
prospectus(es), or any amendment or supplement thereto, comply in all material
respects with the applicable accounting requirements of the Securities
Act.

       

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

       

      (n)           Cooperation of Selling Stock
Holders.  Whenever under the preceding Sections of this
Agreement the holders of Registrable Shares are registering such shares pursuant
to any registration statement, each such holder agrees to (i) timely provide in
writing to the Corporation, at its request, such information and materials as
the Corporation may reasonably request in order to effect the registration of
such Registrable Shares in compliance with federal and applicable state
securities laws, and (ii) provide the Corporation with appropriate
representations with respect to the accuracy of such information provided by
such parties.

       

      6.           Registration
Expenses.

       

      6.1           Corporation’s
Expenses.  All expenses incident to the Corporation’s
performance of or compliance with this Agreement, including, but not limited to,
all registration and filing fees, fees and expenses of compliance with
securities or “blue sky” laws, printing expenses, messenger and delivery
expenses, fees and disbursements of custodians and fees and disbursements of
counsel for the Corporation and all independent certified public accountants,
underwriters (excluding discounts and commissions) and other Persons retained by
the Corporation (all such expenses being herein called “Registration
Expenses”), will be borne by the Corporation (including any Registration
Expenses in connection with any registration initiated as a Demand Registration
which is not deemed to be effected pursuant to Section
2.3).  In addition, the Corporation will pay its internal
expenses (including, but not limited to, all salaries and expenses of its
officers and employees performing legal or accounting duties), the expense of
any annual audit or quarterly review, the expense of any liability insurance
obtained by the Corporation and the expenses and fees for listing the securities
to be registered on each securities exchange or market.

       

      6.2           Holder’s
Expenses.  In connection with any registration statement in
which Registrable Shares are included, the Corporation will reimburse the
holders of Registrable Shares covered by such registration for the reasonable
cost and expenses incurred by such holders in connection with such registration,
including, but not limited to, reasonable fees and disbursements of one counsel
chosen by the holders of a majority of such Registrable Shares.

       

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

         

      

      7.           Indemnification.

       

      7.1           By the
Corporation.  The Corporation agrees to indemnify, defend and
hold harmless, to the fullest extent permitted by law, each holder of
Registrable Shares, its officers, directors, partners and members, and each
Person who controls such holder (within the meaning of the Securities Act or
Exchange Act) against all losses, claims, damages, liabilities, amounts paid in
settlement and expenses (including, but not limited to, attorney’s fees and
expenses) (joint or several) caused by (a) any untrue or alleged untrue
statement of material fact contained or incorporated by reference in any
registration statement, prospectus or preliminary prospectus, or any amendment
thereof or supplement thereto, (b) any omission or alleged omission to
state in any registration statement or any amendment thereto (including, without
limitation, through incorporation by reference) a material fact required to be
stated therein or necessary to make the statements therein not misleading, or by
any omission or alleged omission to state in any prospectus, preliminary
prospectus or amendment or supplement thereto (including, without limitation,
through incorporation by reference) a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, or (c) any
violation or alleged violation by the Corporation of the Securities Act, the
Exchange Act, any state securities law or any other law relating to the offering
covered by such registration statement or any rule or regulation promulgated
thereunder, except insofar as any losses, claims, damages, liabilities, amounts
paid in settlement or expenses relating to (x) clauses (a) or (b) above are
caused by any untrue statement or omission or alleged untrue statement or
omission based upon written information related to such holder furnished to the
Corporation by, or on behalf of, such holder specifically for use therein, or
(y) any defect in a prospectus if (i) the final prospectus was amended
or supplemented by the Corporation, (ii) the Corporation furnished such
amendment or supplement to the holder (or any Person controlling such holder)
from which the Person asserting such loss, claim, damage or liability acquired
Registrable Shares, (iii) the final prospectus (as so amended or
supplemented) would have cured the defect giving rise to such loss, claim,
damage or liability, and (iv) the final prospectus was not sent by, or
delivered on behalf of, such holder to such Person at or prior to the written
confirmation of the sale of the Registrable Shares to such Person; and the
Corporation will promptly reimburse each such indemnified person for any legal
or other expenses reasonably incurred by them, as incurred, in connection with
investigating or defending any such loss, claim, damage, liability, settlement
or expenses, provided such indemnified person shall agree to remit such payments
to the Corporation if it is finally determined by a court of competent
jurisdiction that such person was not entitled to indemnification
hereunder.  The payments required by this Section 7.1 will be
made periodically during the course of the investigation or defense, as and when
bills are received or expenses incurred.

       

      7.2           By Each
Holder.  In connection with any registration statement in which
a holder of Registrable Shares is participating, each such holder agrees to,
severally and not jointly, indemnify the Corporation, its directors and officers
who sign the registration statement and accountants and each Person who controls
the Corporation (within the meaning of the Securities Act or Exchange Act)
against any losses, claims, damages, liabilities and expenses resulting from any
untrue or alleged untrue statement of material fact contained or incorporated by
reference in the registration statement, prospectus or preliminary prospectus,
or any amendment thereof or supplement thereto, or any omission or alleged
omission to state in any registration statement or any amendment thereto
(including, without limitation, through incorporation by reference) a material
fact required to be stated therein or necessary to make the statements therein
not misleading, or any omission or alleged omission to state in any prospectus,
preliminary prospectus or amendment or supplement thereto (including, without
limitation, through incorporation by reference) a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, but only to the extent
that such untrue statement or omission is contained in or omitted from any
written information related to such holder furnished to the Corporation by, or
on behalf of, such holder specifically for use therein; provided that the
liability of each such holder of Registrable Shares will be in proportion to and
limited in all events to the net amount received by such holder from the sale of
Registrable Shares pursuant to such registration statement.

       

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

         

      

      7.3           Procedure.  Any
Person entitled to indemnification hereunder will (i) give prompt written
notice to the indemnifying Person of any claim with respect to which it seeks
indemnification, and (ii) unless in such indemnified Person’s reasonable
judgment an actual or potential conflict of interest between such indemnified
and indemnifying parties may exist with respect to such claim, permit such
indemnifying Person to assume the defense of such claim with counsel reasonably
satisfactory to the indemnified Person provided the indemnifying Person has
acknowledged in writing to the indemnified Person such indemnifying Person’s
obligation to so indemnify the indemnified Person hereunder.  If such
defense is assumed, the indemnified Person will not be subject to any liability
for any settlement made by the indemnifying Person without its consent (which
consent will not be unreasonably withheld, delayed or conditioned), unless such
settlement is solely for monetary damages and includes an unconditional release
of such indemnified Person from all liability on claims that are the subject
matter of such proceeding.  An indemnifying Person who is not entitled
to, or elects not to, assume the defense of a claim will not be obligated to pay
the fees and expenses of more than one counsel for all parties indemnified by
such indemnifying Person with respect to such claim, unless in the reasonable
judgment of any indemnified Person a conflict of interest may exist between such
indemnified Person and any other of such indemnified parties with respect to
such claim.  An indemnifying Person who is not entitled to, or elects
not to, assume the defense of a claim shall not be liable for any settlement of
any proceeding effected without its written consent (which consent will not be
unreasonably withheld, delayed or conditioned) but, if settled with such consent
or if there be a final judgment for the plaintiff, the indemnifying Person
agrees to indemnify the indemnified Person from and against any loss or
liability by reason of such settlement or judgment.

       

      7.4           Contribution.  If
the indemnification provided for in this Section 7 is held by
a court of competent jurisdiction to be unavailable to an indemnified Person
with respect to any loss, liability, claim, damage or expense referred to
herein, then the indemnifying Person, in lieu of indemnifying such indemnified
Person hereunder, shall contribute to the amount paid or payable by such
indemnified Person as a result of such loss, liability, claim, damage or expense
in such proportion as is appropriate to reflect the relative fault of the
indemnifying Person on the one hand, and of the indemnified Person on the other
hand, in connection with the statements or omissions or violations of the
Securities Act, the Exchange Act, any state securities law or any other law,
rule or regulation relating to the applicable offering that resulted in such
loss, liability, claim, damage or expense, as well as any other relevant
equitable considerations.  The relative fault of the indemnifying
Person and of the indemnified Person shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission to state a material fact relates to information supplied by the
indemnifying Person or by the indemnified Person and the parties’ relative
intent, knowledge, access to information, and opportunity to correct or prevent
such statement or omission; provided that the
liability of each holder of Registrable Shares under this Section 7.4 will be
in proportion to and limited in all events to the net amount received by such
holder from the sale of Registrable Shares pursuant to such registration
statement.

       

      The
Corporation and each holder of Registrable Shares agree that it would not be
just or equitable if contribution pursuant to this Section 7.4 were
determined by pro rata allocation or by
any other method of allocation that does not take account of the equitable
considerations referred to in the foregoing paragraph.  The amount
paid or payable by an indemnified Person as a result of the losses, claims,
damages and liabilities referred to in the foregoing paragraph shall be deemed
to include, subject to the limitations set forth above, any legal or other
expenses reasonably incurred by such indemnified Person in connection with
investigating or defending any such action or claim.  No person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any Person who was not
guilty of such fraudulent misrepresentation.

       

      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

       

      7.5           Survival and
Remedies.  The indemnification provided for under this
Agreement will remain in full force and effect regardless of any investigation
made by or on behalf of the indemnified Person or any officer, director or
controlling Person of such indemnified Person and will survive the transfer of
Registrable Shares.  The Corporation also agrees to make such
provisions as are reasonably requested by any indemnified Person for
contribution to such Person in the event the Corporation’s indemnification is
unavailable for any reason.  The remedies provided for in Section 7 are not
exclusive and shall not limit any rights or remedies which may otherwise be
available to any indemnified party at law, in equity or otherwise.

       

      8.             Compliance with Rule
144.  In the event that the Corporation (a) registers a
class of securities under Section 12 of the Exchange Act, (b) issues an
offering circular meeting the requirements of Regulation A under the Securities
Act or (c) commences to file reports under Section 13 or 15(d) of the
Exchange Act, then at the reasonable request of any holder of Registrable Shares
who proposes to sell securities in compliance with Rule 144 of the Commission,
the Corporation will (i) make and keep public information available (as
those terms are understood and defined in Rule 144) so as to enable the holders
of Registrable Shares to make sales pursuant to Rule 144, (ii) file with
the Commission in a timely manner all reports and other documents required of
the Corporation under the Securities Act and the Exchange Act so long as the
Corporation remains subject to such requirements and the filing of such reports
and other documents is required for the applicable provisions of Rule 144, and
(iii) forthwith furnish to such holder (x) a written statement by the
Corporation that it has complied with the reporting requirements of Rule 144,
the Securities Act and the Exchange Act, (y) a copy of the most recent
annual or quarterly report of the Corporation and such other reports and
documents so filed by the Corporation, and (z) such other information as
may be reasonably requested to permit such holder to sell such Registrable
Shares pursuant to Rule 144 without registration.  In addition and
without limitation of any other provision contained herein, as soon as
practicable (but in any event not later than sixty (60) calendar days) following
the written request of the Investor or holders of at least one-third of the
Registrable Shares, the Corporation shall file with the Commission current “Form
10 information” as contemplated by and in accordance with Rule
144(i).

       

      9.           Participation in
Underwritten Registrations.  No Person may participate in any
registration hereunder which is underwritten unless such Person (a) agrees
to sell its securities on the basis provided in any underwriting arrangements
approved by such Person or Persons entitled hereunder to approve such
arrangements and (b) completes and executes all questionnaires, powers of
attorney, custody agreements, indemnities, underwriting agreements and other
documents reasonably required under the terms of such underwriting
arrangements.

       

      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

       

      10.           Miscellaneous.

       

      10.1        No Inconsistent
Agreements.  The Corporation will not hereafter enter into any
agreement with respect to its securities which is inconsistent with the rights
granted to the holders of Registrable Shares in this Agreement.

       

      10.2        Adjustments Affecting
Registrable Shares.  The Corporation will not take any action,
or permit any change to occur, with respect to its articles of incorporation or
bylaws which would prevent the holders of Registrable Shares from including such
Registrable Shares in a registration undertaken pursuant to, or otherwise
prevent the holders from exercising their rights under, this Agreement or which
would prohibit the Corporation from granting the holders the registration rights
set forth in this Agreement.

       

      10.3        Other Registration
Rights.  The Corporation will not hereafter grant to any Person
or Persons the right to request the Corporation to register any equity
securities of the Corporation, or any securities convertible or exchangeable
into or exercisable for such securities, or to participate in any registration,
which right conflicts or interferes with any of the rights granted hereunder or
to the extent such participation rights provide for the inclusion of securities
on a parity with or prior to the inclusion of Registrable Shares.  The
Corporation will not include in any Demand Registration any securities which are
not Registrable Shares (for the purposes of Section 2) unless and
until all Registrable Shares requested to be registered have first been so
included, except with respect to Previously Designated Registrable Shares which
may be included as otherwise expressly provided herein.

       

      10.4        Remedies.  Any
Person having rights under any provision of this Agreement will be entitled to
enforce such rights specifically, to recover damages caused by reason of any
breach of any provision of this Agreement and to exercise all other rights
granted by law; provided that no
Person having rights under any provision of this Agreement shall have any right
to obtain or seek an injunction restraining or otherwise delaying any such
registration as the result of any controversy that might arise with respect to
the interpretation or implementation of this Agreement.

       

      10.5        Amendments and
Waivers.  Except as otherwise expressly provided herein, the
provisions of this Agreement may be amended at any time only by the written
agreement of the Corporation and the holders of a majority of the Registrable
Shares.  Any waiver, permit, consent or approval of any kind or
character on the part of any such holders of any provision or condition of this
Agreement must be made in writing and shall be effective only to the extent
specifically set forth in writing.  Any amendment or waiver effected
in accordance with this Section 10.5 shall be
binding upon each holder of Registrable Shares and the Corporation.

       

      10.6        Successors and
Assigns.  Except as otherwise expressly provided herein, all
covenants and agreements contained in this Agreement by or on behalf of either
of the parties hereto will bind and inure to the benefit of the respective
successors and assigns of the parties hereto, whether so expressed or
not.  In addition, and whether or not any express assignment has been
made, the provisions of this Agreement which are for the benefit of the
purchasers or holders of Registrable Shares are also for the benefit of, and
enforceable by, any subsequent holders of such Registrable Shares.

       

      
        
          
          

        

        
          16

          
            

          

        

        
          
          

        

      

       

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

       

      10.8        Descriptive
Headings.  The descriptive headings of this Agreement are
inserted for convenience of reference only and do not constitute a part of and
shall not be utilized in interpreting this Agreement.

       

      10.9        Notices.  All
notices and other communications provided for hereunder shall be in writing
(including telecopy communication confirmed by mail or delivery) and mailed,
telecopied, e-mailed or delivered:

       

      (a)           if
to the Investor, to it at:

       

      DMRJ
Group I, LLC

      Carnegie
Hall Tower

      152 West
57th
Street

      New York,
New York  10019

      Attention:

      Telephone:
(212) 582-2222

      Telecopier:  (212)
582-2424

      E-mail
Address:  dlevy@platinumlp.com

      

      (b)           if
to the Corporation, to it at:

       

      Desert
Hawk Gold Corp.

      Attention:  Robert
E. Jorgensen, Chairman

      8921 N.
Indian Trail Road, #288

      Spokane,
WA   99208

      Telephone:  (509)
434-8161

      Telecopier:

      E-mail
Address: bjorg53@yahoo.com

       

      with a
copy (with shall not constitute notice) to:

       

      Ronald N.
Vance

      Attorney
at Law

      1656
Reunion Avenue

      Suite
250

      South
Jordan, UT 84095

      Telephone:  (801)
446-8802

      Telecopier:  (801)
446-8803

      E-mail
Address:  ron@vancelaw.us

       

      
        
          
          

        

        
          17

          
            

          

        

        
          
          

        

      

       

      or, as to
any party or any other holder of Registrable Shares, at such other telecopy
number or address as shall be designated by such party or holder in a written
notice to the other parties.  All such notices and other
communications shall, when mailed, telecopied, e-mailed or delivered, be
effective when received or, in the case of delivery by mail, on the fourth
(4th)
Business Day after such notice or other communication shall have been deposited
in the mail, postage prepaid, return receipt requested or, in the case of
delivery by overnight express courier, on the Business Day following the
Business Day such notice or communication shall have been deposited with such
courier service.  Delivery by telecopier of an executed counterpart of
any amendment or waiver of any provision of this Agreement or the Note or of any
other Loan Document shall be effective as delivery of an original executed
counterpart thereof.

       

      10.10     
Jurisdiction,
Etc.

       

      (a)           Each
of the parties hereto hereby irrevocably and unconditionally submits, for itself
and its property, to the nonexclusive jurisdiction of any New York State court
or Federal court of the United States of America sitting in New York
County, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to this Agreement, or for recognition or enforcement
of any judgment, and each of the parties hereto hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in any such New York State court or, to
the fullest extent permitted by law, in such Federal court.  Each of
the parties hereto agrees that a final judgment in any such action or
proceeding, to the extent permitted by law, shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.  Nothing in this Agreement shall affect any right
that any party may otherwise have to bring any action or proceeding relating to
this Agreement in the courts of any jurisdiction.

       

      (b)           Each
of the parties hereto irrevocably and unconditionally waives, to the fullest
extent it may legally and effectively do so, any objection that it may now or
hereafter have to the laying of venue of any suit, action or proceeding arising
out of or relating to this Agreement in any New York State or Federal
court.  Each of the parties hereto hereby irrevocably waives, to the
fullest extent permitted by law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.

       

      10.11      Governing
Law.  This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York applicable to contracts made
and to be performed in such State.

       

      10.12      WAIVER OF JURY
TRIAL.  THE PARTIES HERETO IRREVOCABLY WAIVE ALL RIGHT TO TRIAL
BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT,
TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT.

       

      11.           Final
Agreement.  This Agreement, together with the Investment
Agreement and all other agreements entered into by the parties hereto pursuant
to the Investment Agreement, constitute the complete and final agreement of the
parties concerning the matters referred to herein, and supersedes all prior
agreements and understandings.

       

      
        
          
          

        

        
          18

          
            

          

        

        
          
          

        

      

       

      12.           Execution in
Counterparts.  This Agreement may be executed in multiple
counterparts, each of which when so executed and delivered shall be deemed an
original, and all of which together shall constitute one
instrument.

       

      13.           No Strict
Construction.  The language used in this Agreement will be
deemed to be the language chosen by the parties hereto to express their mutual
intent, and no rule of strict construction will be used against any
Person.

       

      [Remainder
of Page Intentionally Left Blank]

       

      [Signature
Page Follows]

      
        
           

        

        
          19

          
            

          

        

        
           

        

      

      

      IN
WITNESS WHEREOF, the parties hereto have executed this Registration Rights
Agreement as of the date first set forth above.

       

    

    
      
        	 
      	
                CORPORATION:

              
	 
      	 
      
	 
      	
                DESERT
      HAWK GOLD CORP.

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Robert E. Jorgensen

              
	 
      	 
      	
                Name:   Robert
      E. Jorgensen

              
	 
      	 
      	
                Title:     Chief
      Executive Officer

              

      

    

    

    
      
        	 
      	
                INVESTOR:

              
	 
      	 
      
	 
      	
                DMRJ
      GROUP I, LLC

              
	 
      	 
      
	 
      	
                By:

              	
                /s/ Daniel Small

              
	 
      	 
      	
                Name:   Daniel
      Small

              
	 
      	 
      	
                Title:     Portfolio
      Manager

              

      

    

    
       

      [Signature
Page to Registration Rights Agreement]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00178-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00178-of-00352.parquet"}]]