Document:

American Petro-Hunter, Inc.: Exhibit 10.1 - Filed by newsfilecorp.com

PARTICIPATION AGREEMENT

     This Participation Agreement (the
“Agreement”) is entered into effective as of October 28, 2013, by, between, and
between Warpaint Kansas LP (“Owner”), and American Petro-Hunter, Inc., together
with its successors, subsidiaries, and any assignees, (“APH”) (together the
“Parties” and individually a “Party”).

RECITALS

     A. Owner owns interests as lessee
under certain oil and gas leases set forth on Exhibit A (collectively the
“Owner’s Leases,” which term shall also include all leases and oil and gas
interests hereafter acquired by or through Owner or APH and owned by Owner and
APH pursuant to the terms of the AMI Agreement provided for in Exhibit D,
below). As to each current Owner’s Lease, Exhibit A reflects the gross
and net acres to the Owner’s working interest believed to be covered by the
lease, the landowner royalty reserved therein, and any additional burdens to
which the interest of Owner is subject.

     B. APH intends to participate in
the development of the Owner’s Leases for the purposes of exploring for, and
producing, oil, gas and other hydrocarbons. To that end, APH will make available
FIVE MILLION FOUR HUNDRED THOUSAND DOLLARS ($5,400,000) towards Owner’s share of
the costs and expenses associated with the Drilling and Completion activities
provided below (the “Exploration Funds”).

     C. Owner agrees that APH may
acquire an interest in the Owner’s Leases under the terms and conditions set
forth herein.

     D. The “Lands” as used herein
refers to the land covered by the Owner’s Leases.

     E. The Parties agree that they
are not entering into any partnership, joint venture, or any other legal
business relationship under this Agreement. The rights, duties, and obligations
of the Parties are established solely by this Agreement.

     NOW THEREFORE in
consideration of the conditions and mutual benefits contained herein, the
Parties, intending to be legally bound, agree as follows:

ARTICLE 1

DEFINITIONS

     As used in this Agreement, the
following terms shall have the following meaning:

     AFE means an
Authority for Expenditure in the form customarily used in the oil and gas
industry setting forth the estimated costs of drilling, testing, logging, and,
if appropriate, perforating, fracing, and equipping to the Completion of such
Program Well, as well as required salt water disposal wells, gathering systems,
pipelines and other infrastructure.

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     AMI Agreement
has the meaning ascribed to it in Exhibit D.

     Business Day means
a day other than Saturday, Sunday or any other day that is a federally
recognized holiday.

     Complete, Completion, or
Completing means to attempt to finish work on a Program Well and attempt
to bring such wells to productive status (which may include the installation of
permanent wellhead and well location surface equipment for the production of oil
and gas, including salt water disposal wells and facilities (whether or not
located on the lease)) or to plug and abandon (including surface restoration and
reclamation in accordance with applicable Laws and contractual obligations) such
Program Well without production, if appropriate. For the purposes of this
Agreement productive status means first sales.

     Completion Costs
means, with respect to a Program Well, all costs and expenses relating
to the preparation for, Drilling, testing, logging, and, if appropriate,
perforating, fracing, and equipping, or plugging and abandonment, as the case
may be, to the point of Completion of such Program Well. Completion Costs also
include necessary lease facilities but do not include any off-lease facilities
such as gathering systems and pipelines. For the purposes of this Agreement,
salt water disposal wells, regardless of the location, are considered
Completions Costs; however, it is in APH’s discretion, as operator, to propose
and utilize third part disposal wells at a cost to the working interest
owners.

     Drill or Drilling
means, with respect to a Program Well, the actual drilling, testing, and
logging, as appropriate, of such Program Well.

     Existing Burdens
means as to each Owner’s Lease, the lease royalty and any overriding
royalties, payments from or out of production or the proceeds thereof and other
burdens or production affecting all or any portion of any of the Owner’s Leases
that are disclosed on Exhibit A.

     Exploration Funds
has the meaning ascribed to that term in Recital B.

     Governmental Authority
means (a) United States of America, (b) any state, county, municipality
or other governmental subdivision within the United States of America, and (c)
any court or any governmental department, commission, board, bureau, agency or
other instrumentality of the United States of America or of any state, county,
municipality or other governmental subdivision within the United States of
America.

     JOA has
the meaning ascribed to that term in Section 5.1.

     Lands has
the meaning ascribed to that term in Recital D.

     Laws means all
applicable statutes, laws, ordinances, regulations, rules, rulings, orders,
decrees or other official acts of any Governmental Authority.

     Operator
has the meaning ascribed to that term in the relevant JOA.

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     Owner has
the meaning ascribed to that term in Recital A.

     Owner’s Leases
has the meaning ascribed to that term in Recital A.

     Owner’s Lease Payments
has the meaning ascribed to that term in Section 6.3.

     Person means any
individual, firm, corporation, partnership, joint venture, trust, unincorporated
organization, Governmental Authority, or other entity or organization.

     Program Area
means all of the lands described in Exhibit B.

     Program Objections
has the meaning ascribed to that term in Section 3.2. 

     Program Well Assignment
has the meaning ascribed to that term in Section 5.2. 

     Program Well Unit
has the meaning ascribed to that tern in Section 2.1 

     Service or Served
has the meaning ascribed to that term in Section 9.2.

     Spud, Spudding or Spudded
a Program Well means the commencement of actual drilling operations (the
bit entering the ground) for that well with a rig capable of drilling to the
target formation.

     Termination
shall have the meaning specified in Section 4.2.

ARTICLE 2

EXPLORATION AND DEVELOPMENT PROGRAM

     2.1 Exploration and
Development. APH shall propose wells on the Lands or on lands with which
portions of the Lands will be pooled or unitized, each such well being a
“Program Well” and each such proposal being a “Proposal”. Each Proposal shall be
in writing delivered to Owner and shall include all engineering, geologic,
geophysical, and other information held by APH and relevant to such Proposal. As
currently anticipated, the target depth for each Program Well shall be
sufficient to test the Mississippian Formation, but future Program Wells may
test other formations, in accordance with Section 2.3 Each Proposal shall
specify a spacing unit as required by governmental regulation or order or, in
the absence of the same, on a spacing unit designated by APH, subject to the
approval of Owner, which approval shall not be unreasonably withheld. In the
event that the spacing unit requires the combination of separate tracts by
pooling or unitization, at least forty (40) net mineral acres covered by Owner’s
Leases shall be included in such pooled or unitized spacing unit and at least
fifty percent (50%) of the net mineral acres included in such pooled or unitized
spacing unit shall consist of Owner’s Leases. Each such spacing unit, whether or
not a pooled or unitized tract, shall be a “Program Well Unit.” A Proposal shall
include any necessary lease facilities, including saltwater disposal facilities,
but shall not include any off-lease facilities such as gathering systems or pipelines. Subject to regulatory
constraints, a Proposal may be made for the drilling of an additional Program
Well on an existing Program Well Unit.

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     2.2 Drilling
Schedule. APH shall deliver a Proposal and file all required permit
applications for the first Program Well within thirty (30) days of the date of
this Agreement and shall Spud such well within ninety (90) days of receipt of
all required permits but not later than March 31, 2014. Thereafter, APH shall
Spud a Program Well at intervals of no longer than ninety (90) days from
Spudding the previous Program Well, without regard to the status of any prior
Program Well, until the expenditure of all Exploration Funds as provided below
or Termination as defined below. During such period, but after the Spudding of
the third Program Well, APH may extend one such ninety (90) day period by an
additional thirty (30) days, by written notice given before the end of such
ninety (90) day period and APH may request additional extensions, by written
request explaining the reasons therefor and submitted before the end of the
period sought to be extended. Owner shall consider each such request and may
grant or reject such requests in its discretion, reasonably exercised. In
exercising its discretion Owner may consider, in addition to the reasons
specified, the general conduct of operations by APH as well as its own interest
in the complete and orderly development of the Owner’s Leases. As to each
Program Well, once Spudded, APH shall conduct operations as a reasonable and
prudent operator, diligently and without unreasonable interruption (any
interruption of more than thirty (30) days being conclusively deemed
unreasonable), until Completion. APH shall continue to propose, Drill, and
Complete Program Wells on the schedule just provided until twenty percent (20%)
of its Completion Costs equals the amount of the Exploration Funds. This Section
2.2 shall be subject to availability of costs effective and competent oilfield
services at all times.

     2.3 Initial
Commitment. Notwithstanding any requests for extensions, APH shall Drill
and Complete as wells capable of production in paying quantities with first
sales of natural gas having occurred, three (3) Program Wells prior to December
31, 2014. Failure to do so shall result in the Termination, as defined in
Section 4.2, below, a subject only to Owner’s obligation to make any assignments
of interest due based on any Program Wells. It is the Parties mutual preference
that at least two (2) of the three (3) Program Wells, under the initial
commitment, shall test the Mississippian horizontally; alternatively, if only
one (1) well tests the Mississippian formation horizontally, APH is committed to
spending seven million five hundred thousand dollars ($7,500,000) drilling
wells, on an 8/8ths basis, or twenty percent (20%) on behalf of the owner,
before December 31, 2014; failure to do so shall result in Termination.

     2.4 Earning.
By Drilling and attempting to Completing a Program Well as a well
capable of production in paying quantities and commencing sales of gas therefrom
and paying one hundred percent (100%) of any Completion Cost thereof
attributable to Owner’s
Leases: 
          (a)
APH will earn an assignment from Owner
of:
               
(i) an undivided two percent (2%) working interest, on an eight-eights (8/8ths)
basis, in any Owner’s Lease (or portion thereof) in which APH has not already
received an assignment of a total of an eighty percent (80%) working interest
(in the event that Owner’s Leases comprise less than one hundred percent (100%)
of the interest in the Program Well Unit for such Program Well then the two
percent (2%) working interest shall be reduced proportionately to the extent
that the Program Well Unit contains working interests other than Owner’s
Leases); and

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               (ii)
a working interest in Owner’s Leases to the extent that they cover acreage
within the Program Well Unit for such Program Well equal to the difference
between all working interest in such leases to such extent previously assigned
to APH or assigned to APH pursuant to (i) above, and eighty percent (80%) (as a
result, if the Program Well in question is an additional well on an existing
Program Well Unit then no additional interest in such unit shall be earned),
provided
that, 
          (b)
(i) any assignment of each Owner’s Lease as just provided that is earned prior
to the Completion by APH of three Program Wells that are capable of production
in paying quantities and the commencement of sales from each such Program Well
shall be made at a Net Revenue Interest of seventy five percent (75%), with
Owner retaining an overriding royalty interest equal to the positive difference,
if any, between all existing burdens as to such Owner’s Lease and twenty five
percent (25%), provided, however, that Completion from the last of such three
Program Wells to commence such sales, such assignments shall automatically vest
in APH, prospectively, an additional net revenue interest such that APH shall
own the working interests conveyed at a net revenue interest of eighty one and
one quarter percent (81.25%) and any overriding royalty interest retained by
shall be reduced to the positive difference, if any, between all existing
burdens as to such Owner’s Lease and eighteen and three quarters percent
(18.75%); 
               (ii)
any assignment of each Owner’s Lease as just provided that is earned after the
Completion by APH of three Program Wells that are capable of production in
paying quantities and the commencement of natural gas sales from each such
Program Well shall be made at a Net Revenue Interest of eighty one and one
quarter percent (81.25%), with Owner retaining an overriding royalty interest
equal to the positive difference, if any, between all existing burdens as to
such Owner’s Lease and eighteen and three quarters percent (18.75%).

ARTICLE 3

EXPLORATION FUNDS AND PROCEDURES

     3.1 Exploration
Funds. The Exploration Funds will be committed to the payment of that
portion of the Completion Costs of Program Wells attributable to Owner’s
retained twenty percent (20%) interest. APH’s obligations regarding the
application of the Exploration Funds shall survive Termination; as such, even if
this Agreement is terminated, and APH can no longer earn additional acreage
under Section 2.4, APH will be obligated to pay twenty percent (20%) of the
Owner’s Completion Costs on any well proposed by APH under the JOA, including
additional wells in Program Well Units and additional pooled units.

     3.2 Adjustments to
Exploration Fund.

          (a)
If either party determines and provides written notice of such determination as
soon as identified, but no event later than February 28, 2014, following the
execution of this Agreement any of the Owner’s Leases listed on Exhibit A
is subject to a title defect or actually covers a different number of net
mineral acres than that shown on such exhibit as to such Owner’s Lease, then the
amount of the Exploration Funds shall be adjusted downward or upward by the
change in the number of net acres covered in such lease, as compared to the
number shown on Exhibit A, times eighty percent (80%) times four hundred
and fifty dollars ($450) per net mineral acre. If such Lease is subject to a
complete title defect then it shall no longer be considered an Owner’s Lease and the adjustment shall be based
on the entire number of net mineral acres shown on Exhibit A.

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          (b)
Any such notice shall specify the Owner’s Lease in question and shall specify
the basis for the adjustment of the net mineral acres attributable to such
lease. The absence of a document from Owner’s files does not establish the
existence of a title defect or otherwise provide the basis of an adjustment
hereunder. An Owner’s Lease shall be considered to be subject to a title defect
if: 
               (i)
is subject to any (x) security interest, lien, mortgage, pledge, hypothecation,
restriction on transfer, including any conditional sale or other title retention
contract or lease in the nature thereof; (y) any filing or agreement to file a
financing statement as debtor under the applicable Uniform Commercial Code or
any similar statute; and (z) any subordination arrangement in favor of another
person (including artificial persons), except for matters to be released at
Seller’s expense at or prior to
Closing; 
               (ii)
is subject to some matter such that Owner and Owner’s heirs, successors and
assigns will not be entitled to receive, throughout the life of such Lease, a
share of the hydrocarbons produced, saved from or attributable to such Lease,
after giving effect to all valid royalties, overriding royalties, production
payments, net profits interests, carried interests, reversionary interests, or
other similar interests constituting burdens upon, measured by, or payable out
of the hydrocarbons produced and saved from or attributable to such Lease of not
less than eighty-one and one quarter percent
(81.25%); 
               (iii)
such Lease does not grant to the oil and gas lessee all of the rights considered
usual and necessary to explore for and produce oil and gas;
and 
               (iv)
Is subject to, or will subject Buyer to, any area of mutual interest, preference
right, option or similar right, other than that created hereby.

          (c)
If the parties disagree on the validity of any such notice the matter shall be
resolved by submission to an attorney knowledgeable regarding oil and gas title
matters agreeable to both parties, with costs shared equally by the parties. No
adjustment shall be made to the amount of the Exploration Funds for any matter
not covered by a notice delivered within such thirty (30) day period.

     3.3 Exploration
Procedures. The following procedures shall be
used: 
          (a)
Each Proposal by APH shall
include:
               (i)
an AFE for each individual Program Well including any necessary lease facilities
providing the Program
Well; 
               (ii)
a description of the Program Well Unit, including a list of all Owner’s Leases
affected by same and a list of all other oil and gas leases affected thereby,
including as to each a list of all working interests owners therein, to APH’s
knowledge; 
               (iii)
detail regarding the well design and specifications regarding the Program Well;
the description of the nature, function, design, and justification for any such
other
undertaking; 

               (iv)
if available at the time of Proposal, a drilling title opinion from an attorney
satisfactory to Owner covering all tracts in the Program Well Unit for such
Program Well, together with curative satisfactory to Owner regarding any
requirements contained in such opinion, and if not provided at the time of Proposal, a
drilling title opinion must be provided to Owner prior to Spudding a Program
Well and 

                (v) the proposed timing for the Drilling and Completion of the Program
Well.

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          (b)
The Owner shall have twenty (20) days from Service of the Proposal to object to
the same, which objections shall be limited to engineering, geological, well
design, the necessity for and design of lease facilities, well location, Program
Well Unit size or configuration, title, and permitting issues (the “Program
Objections”). The Program Objections shall be in writing and shall include a
detailed explanation of the objections, and shall be Served on APH within the
aforementioned twenty-day period

          (c)
Within ten (10) days of timely Service of the Program Objections, the Parties
shall meet in a good faith effort to resolve the Program Objections or to
establish an alternate Program Well. In the event the Parties are unable to
resolve a Program Objection within ten (10) days after the forgoing meeting,
then if any Program Objection is based on (i) the Program Well, the proposed
Program Well Unit or the Proposal not being in conformity with the requirements
of this Agreement then the AFE shall be deemed withdrawn and no operations
pursuant thereto shall be conducted, or (ii) other matters, then APH shall be
entitled to proceed under the applicable AFE, notwithstanding the unresolved
Program Objections, provided , however, that no portion of any costs in excess
of AFE shall be chargeable against Exploration Funds.

     3.4 Proposals by
Owner. Owner shall have the right to propose the Drilling of wells on
Owner’s Leases or on pooled units, whether voluntary or imposed by regulatory
authority, including Lands. The following provisions shall apply to any such
proposal made prior to the complete expenditure of the Exploration Funds in
regard to Program Wells or upon payment to Owner directly as provided in Section
4.1, below. Any such proposal by Owner shall be in the form set forth in Section
3.3, above (each an “Owner Proposal”). APH shall notify Owner within twenty (20)
days of its receipt of an Owner Proposal if it elects to participate in the
Drilling of such well. Absent such a notice, APH shall be deemed to have
declined to participate. If APH declines to participate in the Drilling of such
well then APH shall reassign to Owner all interests Owner’s Leases to the extent
that they cover Lands within the Program Well Unit specified in the Owner’s
Proposal (less and except the wellbore of any Program Well located within such
Program Well Unit), and APH will not be liable for Exploration Funds in the
proposed well. If APH elects to participate in the Drilling of such well then
such Well shall be a Program Well and will be treated for all purposes hereunder
as such.

     3.5 Expenditure of
Exploration Funds.

          (a)
In connection with any Program Well or other AFE which APH is authorized to
implement pursuant to the foregoing, APH shall bill the Owner pursuant to the
JOA, as the case may be, in connection with the expenditures in connection with
such Project Well or other AFE, provided that any such bills, to the extent
attributable to the interest of such Owner based on its interest in an Owner’s
Lease shall be chargeable, when due, against the Exploration Funds to the extent
of those funds and paid by APH and, therefore, APH shall to the extent of the
Exploration Funds shall pay such amounts.

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          (b)
Owner’s right to charge its share of Completion Costs, or of any other AFE as
referenced above, against Exploration Funds and, therefore, to have them paid by
APH shall continue without regard to whether additional interests in Owner’s
Leases will be earned by APH pursuant hereto as a result of the Drilling of such
Program Well or the accomplishment of the work contemplated by such other AFE
and, specifically, will not be affected by the termination of APH's right to
earn additional assignments of Owner’s Leases hereunder.

          (c)
For the avoidance of doubt, Owner’s right to have its Completion Costs
attributable to its interest in any well drilled on Owner’s Leases, or on lands
pooled therewith, in which APH participates, without regard for who proposes
such well, shall continue until the complete expenditure of the Exploration
Funds in regard to such wells or until payment to Owner directly as provided in
Section 4.1, below. Owner directly as provided in Section 4.1, below. If APH
elects to sell any interest in Owner’s Leases prior thereto, then it shall pay
the proceeds of any such sale to Owner to the extent of the remaining balance of
the Exploration Funds as a credit against such funds.

ARTICLE 4

Payoff/Termination

     4.1 Payoff.
At any time prior to Termination APH may pay to Owner the outstanding
balance of the Exploration Funds. Unless Termination has occurred prior to such
payment, upon the complete expenditure of the Exploration Funds in regard to
Program Wells or upon payment to Owner directly as just provided, APH shall earn
an undivided eighty percent (80%) working interest in all of Owner’s Leases at
an eighty-one and one quarter percent (81.25%) net revenue interest (with Owner
retaining a twenty Percent (20%) working interest and an overriding royalty
interest as to APH’s working interest equal to the positive difference between
eighteen and three quarters percent (18.75%) and existing burdens) and Owner
shall assign to APH such interest in Owner’s Leases that when combined with
previous assignments shall vest such interest in APH. Thereafter, APH shall have
no obligation to pay Owner’s share of any of the costs incurred in connection
with the ownership or operation of the Owner’s Leases.

     4.2 Termination.
If APH fails to maintain the Drilling schedule provided for above or
otherwise breaches its obligations hereunder Owner may terminate APH’s right to
earn additional assignments under this Agreement, to earn assignments of
additional interests by making payments under Section 6.3, and to participate in
the acquisition of leases under the AMI (“Termination”), unless Termination is
waiver by Owner. Termination shall be effective immediately upon Owner’s
delivery to APH of notice thereof.

     4.5 Effect of
Termination. Termination shall not release any of the Parties from any
obligations arising hereunder prior to such termination. Termination does not
preclude Owner from exercising other remedies that are provided in this
Agreement or that are available at law or in equity. Except as otherwise set
forth in this Agreement, all remedies are cumulative, and the exercise of, or
failure to exercise, one or more of them by a Party shall not, to the extent
provided by law, limit or preclude the exercise of, or constitute a
waiver of, other remedies by such Party. In the event of a Termination each JOA
shall remain in full force and effect.

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ARTICLE 5

JOA AND ASSIGNMENT OF OWNER’S LEASES

     5.1 JOA. The
Parties shall enter into a model form A.A.P.L. FORM 610 – 1989 Joint Operating
Agreement in the form attached hereto as Exhibit E for each Program Well
covering the Program Well Unit. APH shall be appointed as the Operator under the
JOA. After Completion, all further costs and expenses concerning the Program
Well will be shared proportionately by the parties to the JOA pursuant thereto.
If any Program Well Unit will include any third party working interests Owner
then the Parties agree to seek to negotiate a joint operating agreement with
such third parties as near in its terms to the JOA as may be and upon concluding
such negotiation on terms acceptable to each of the Parties such joint operating
agreement shall be executed.

     5.2
Assignment. The assignments of working interest provided for
in this Agreement shall be made on the form attached hereto as Exhibit
C.

ARTICLE 6

OPERATIONS; PAYMENT OF EXPENSES

     6.1 Drilling and
Completion. APH shall use reasonable efforts to cause each Program Well
to be drilled to their respective depth as provided in the Proposal for such
Program Well, in accordance with the terms of this Agreement and the JOA.

     6.2 Application of
JOA; Conflicts. All operations conducted with respect to any Program
Well shall be governed by and conducted in accordance with the provisions of
this Agreement and the applicable JOA. In the event of any conflict or
discrepancy between the terms of this Agreement and a JOA, the terms and
provisions of this Agreement shall control, regardless of any other provision to
the contrary herein, and in the case this Agreement is terminated.

     6.3 Payment of Lease
Rentals and Other Payments. From the effective date of this Agreement
until termination of the same, the Parties will be responsible for their
proportionate share (80% APH and 20% Owner, without regard for the actual
ownership at the time such payment becomes due) of all rentals, minimum royalty,
bonuses due on extensions and all other payments related to the maintenance of
the Owner’s Leases in effect (but not including any bonus or other payment due
in connection with the acquisition of any Owner’s Lease) (the “Owner’s Lease
Payments”). Unless otherwise agreed to by the Parties, Owner shall notify APH in
writing twenty (20) days before each payment is due which notice shall identify
such Owner’s Lease and the amount of the Owner’s Lease Payment that is due and
shall inform APH whether Owner is willing to make its twenty percent (20%) share
of such payment. If Owner is not willing to make its twenty percent (20%) share
of such payment then APH may make such Owner’s Lease Payment. Upon receipt of written confirmation
that such payment has been made by APH, Owner shall assign to APH all of Owner’s
interest in such Owner’s Lease to the extent that such lease would have
terminated but for such payment, such conveyance being made at an eighty-one and
one quarter percent (81.25%) net revenue interest (with Owner retaining an
overriding royalty interest equal to the positive difference between eighteen
and three quarters percent (18.75%) and existing burdens). Such leases to such
extent shall no longer be considered Owner’s Leases. If Owner’s notice to APH
indicates Owner’s willingness to fund its twenty percent (20%) share of such
Owner’s Lease Payment then APH shall pay such Owner’s Lease Payment and Owner
shall reimburse the APH for Owner’s share of the same. Upon receipt of written
confirmation that such payment has been made by APH, Owner shall assign to APH
any additional interest in such Owner’s Lease, to the extent that such lease
would have terminated but for such payment, which when combined with any
interest in such Owner’s Lease previously assigned to APH equals an eighty
percent (80%) working interest at an eighty-one and one quarter percent (81.25%)
net revenue interest. No portion of the Owner’s Lease Payments shall be a part
of the Exploration Funds.

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ARTICLE 7

WELL INFORMATION AND DATA; CONFIDENTIALITY

     7.1 Seismic,
Geologic and Engineering Information. Each Party shall furnish to the
other Parties, copies of all geologic and geophysical data, engineering reserve
reports, electric and other logs pertaining to the Program Wells owned by or
under the control of the disclosing Party (whether currently owned or
subsequently acquired), which the disclosing Party may disclose without
violating any contractual or other restriction and without the incurrence of a
fee. Subject to applicable contractual restrictions, the Parties shall make
copies of any seismic information covering the Program Area owned by or under
their individual control (whether currently owned or subsequently acquired)
available for review by the other Parties at the offices of such disclosing
Party during normal business hours. Upon request, each Party shall provide the
requesting Party with all cores, cuttings, and other geological, geophysical
well and production data and maps secured from, or prepared in connection with,
operations on a Program Well; provided, however, that all reasonable costs
associated with providing any of the forgoing items shall be promptly paid by
the requesting party.

     7.2 Title
Information. Each Party shall furnish the other Parties with any title
opinions and other title information in the disclosing Party’s possession or
control relating to any Program Well.

ARTICLE 8

RELATIONSHIP OF PARTIES

     8.1 Independent
Owner. The Parties expressly do not intend to create, and no provision
hereof shall be construed as creating a partnership, joint venture, mining
partnership, corporation, association or other relationship whereby any Party
shall ever be held liable for the acts, either by omission or commission, of the
other. Each Party shall be individually responsible for its own obligations as set out in this
Agreement and in the JOA, and no Party shall be a fiduciary of the other Parties
under this Agreement.

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     8.2 Third
Parties. Nothing in this Agreement (express or implied) is intended or
shall be construed to confer upon any person or entity not a Party any right,
remedy or claim under, or by reason of, this Agreement.

     8.3 Several
Obligations. All obligations of the Parties shall be several and not
joint and several, and all rights of the Parties shall be separate and
independent.

ARTICLE 9

NOTICES

     9.1 Notices.
Unless this Agreement specifically requires otherwise, any notice, demand,
consent or request provided for in this Agreement (including but not limited to
Program Objections, Termination Notice, and AFEs), or served, given or made in
connection with it, shall be in writing and shall be deemed properly served,
given or made if delivered in person or sent by fax or sent by registered or
certified mail, postage prepaid, or by a nationally recognized overnight courier
service that provides a receipt of delivery, or by electronic mail (with a copy
of the notice given no later than the next Business Day in one of the other
forms described in this Section 9.1), in each case, to the Parties at the
addresses specified below:

	 	If to Owner: 
	 	 	Warpaint Kansas, LP 
	 	 	Attn: Robert O. Dow 
	 	 	1925 Cedar Springs Road, Suite #103 
	 	 	Dallas, Texas 75201-1783 
	 	 	Phone: (469) 250-7555 
	 	 	Fax: (469) 250-7588 
	 	 	Email: dow@warpaintresources.com 
	 	 	 
	 	If to APH: 
	 	 	American Petro-Hunter, Inc. 
	 	 	Attn: Robert B. McIntosh 
	 	 	250 N. Rock Rd. Suite 365 
	 	 	Wichita, Kansas 67206 
	 	 	Phone: (316) 201-1853 
	 	 	Fax: (316) 201-1862 
	 	 	Email: rmcintosh@americanpetrohunter.com
  

     9.2 Effective Date
of Notice. The effective date of notice shall be as follows (“Service”
or “Served”): (a) notice given by personal delivery, mail, or overnight courier
pursuant to this Section 9.1 shall be effective upon physical receipt; (b)
notice given by fax pursuant to Section 9.1 shall be effective as of (i) the
date of confirmed delivery if delivered before 5:00 p.m. Central time on any
Business Day; or (ii) the next succeeding Business Day if confirmed delivery is after 5:00 p.m. Central time on any
Business Day or during any non-Business Day; (c) notice given by electronic mail
pursuant to this Section 9.1 shall be effective as of (i) the date sent if sent
before 5:00 p.m. Central time on any Business Day; or (ii) the next succeeding
Business Day if sent after 5:00 p.m. Central time on any Business Day or during
any non-Business Day, provided that a copy of the notice given is sent no
later than the next Business Day following the date on which the electronic mail
was sent in one of the other forms described in Section 9.1.

11

ARTICLE 10

REPRESENTATIONS AND WARRANTIES

     10.1 APH
Representations and Warranties. APH represents and warrants to the other
Parties, as of the effective date hereof, as
follows: 
          (a)
Existence of APH. APH is a corporation duly formed and validly existing
under the laws of the State of Nevada and has all requisite power and authority
to conduct its business as it is now being conducted. APH is qualified to do
business in the State of Kansas and to own or operate real and personal property
in the State of
Kansas.
          (b)
Authority. APH has all requisite power and authority to execute and
deliver this Agreement, to perform its obligations hereunder and to consummate
the transactions contemplated hereby. The execution and delivery by APH of this
Agreement, and the performance by APH of its obligations hereunder, have been
duly and validly authorized by all necessary action on the part of APH, no other
action on the part of APH being
necessary.
          (c)
Enforceability. This Agreement has been duly and validly executed and
delivered by APH and constitutes, and upon the execution and delivery by APH of
this Agreement, such Agreement shall constitute, legal, valid and binding
obligations of APH enforceable against APH in accordance with its terms, except
as the same may be limited by bankruptcy, insolvency, reorganization,
arrangement, moratorium or other similar Laws relating to or affecting the
enforcement of the rights of creditors generally, or by general equitable
principles.
          (d)
No Conflicts. The execution and delivery by APH of this Agreement, the
performance by APH of its obligations under this Agreement and the consummation
of the transactions contemplated hereby will
not: 
               (i)
conflict with or result in a violation or breach of any of terms, conditions or
provisions of APH’s organizational
documents; 
               (ii)
require any consent, approval, authorization or permit, or filing with or
notification to, any Person;
or 
               (iii)
conflict with or result in a violation or breach of any term or provision of any
Law applicable to APH or its assets and properties, except for such violations
or breaches which would not, individually or in the aggregate, reasonably be
expected to materially and adversely affect the ability of APH to perform its
obligations under this
Agreement.

          (e)
Governmental Approvals and Filings. No consent, approval or action of,
filing with or notice to any Governmental Authority on the part of APH is
required in connection with the execution, delivery and performance of this
Agreement or the consummation of the transactions contemplated hereby, with the
exception of permits and approvals required by any Governmental Authority relating to a Program Well and
associated activities or any securities laws or other regulatory requirements
related to being a public company.

12

          (f)
Legal Proceedings. There are no actions or proceedings pending (service
of process against APH having been made) or, to APH’s knowledge, specifically
threatened in writing against APH that would, in the aggregate, reasonably be
expected to result in the issuance of any order restraining, enjoining or
otherwise prohibiting or making illegal the consummation of any of the
transactions contemplated by this Agreement.

          (g)
Bankruptcy. There are no bankruptcy, reorganization, or insolvency
proceedings pending with respect to, or being contemplated by, or, to APH’s
knowledge, threatened against, APH.

          (h)
Due Diligence. APH has independently performed its own due diligence on
the Program Area and is not relying upon representations, whether expressed or
implied, made by Owner, including but not limited to production rates, reserves
(if any), prices, drilling or recompletion opportunities and the costs to be
incurred for developing or operating the Owner’s Leases. Further, APH has
performed its own independent geologic, engineering, regulatory and economic
assessment of the Program Area and in signing this Agreement is relying solely
on its own assessment and conclusions.

          (i)
Capital Raising. APH understands and agrees that APH’s capital raising
efforts, whether via equity, debt, retail syndication and/or other means, are
paramount to APH’s ability to perform under the terms of this Agreement. As
such, APH will raise at least its initial commitment under Section 2.3, or seven
million five hundred thousand dollars ($7,500,000), before January 31, 2014, as
evidenced by signed agreements to fund, monies held in escrow, and/or available
cash.

     10.2 Owner
Representations and Warranties. Owner represents and warrants to the
other Parties, as of the date hereof, as follows: 

          (a)
Existence of Owner. Owner is a corporation duly formed and validly
existing under the laws of the State of Texas and has all requisite power and
authority to conduct its business as it is now being conducted. Owner is
qualified to do business in the State of Kansas and to own or operate real and
personal property in the State of Kansas.

          (b)
Authority. Owner has all requisite power and authority to execute and
deliver this Agreement, to perform its obligations hereunder and to consummate
the transactions contemplated hereby. The execution and delivery by Owner of
this Agreement, and the performance by Owner of its obligations hereunder, have
been duly and validly authorized by all necessary action on the part of Owner,
no other action on the part of Owner being necessary.

          (c)
Enforceability. This Agreement has been duly and validly executed and
delivered by Owner and constitutes, and upon the execution and delivery by Owner
of this Agreement, such Agreement shall constitute, legal, valid and binding
obligations of Owner enforceable against APH in accordance with its terms,
except as the same may be limited by bankruptcy, insolvency, reorganization,
arrangement, moratorium or other similar Laws relating to or affecting the
enforcement of the rights of creditors generally, or by general equitable
principles.

          (d)
No Conflicts. The execution and delivery by Owner of this Agreement, the
performance by Owner of its obligations under this Agreement and the
consummation of the transactions contemplated hereby will not:

13

               (i)
conflict with or result in a violation or breach of any of terms, conditions or
provisions of Owner’s organizational
documents; 
               (ii)
require any consent, approval, authorization or permit, or filing with or
notification to, any Person;
or 
               (iii)
conflict with or result in a violation or breach of any term or provision of any
Law applicable to Owner or its assets and properties, except for such violations
or breaches which would not, individually or in the aggregate, reasonably be
expected to materially and adversely affect the ability of Owner to perform its
obligations under this Agreement.

          E)
Governmental Approvals and Filings. No consent, approval or action of,
filing with or notice to any Governmental Authority on the part of Owner is
required in connection with the execution, delivery and performance of this
Agreement or the consummation of the transactions contemplated hereby, with the
exception of permits and approvals required by any Governmental Authority
relating to a Program Well and associated activities.

          (f)
Legal Proceedings. There are no actions or proceedings pending (service
of process against Owner having been made) or, to Owner’s knowledge,
specifically threatened in writing against Owner that would, in the aggregate,
reasonably be expected to result in the issuance of any order restraining,
enjoining or otherwise prohibiting or making illegal the consummation of any of
the transactions contemplated by this Agreement.

          (g)
Bankruptcy. There are no bankruptcy, reorganization, or insolvency
proceedings pending with respect to, or being contemplated by, or, to Owner’s
knowledge, threatened against, Owner.

          (h)
Foreign Person. Owner is not a “foreign person” within the meaning of
Code Section 1445 (See Exhibit F).

          (i)
Leases. To the Owner’s knowledge, the Owner’s Leases listed on Exhibit A
are materially accurate and in good standing. However, Owner is not warranting
title.

          (j)
Net Revenue Interest. The revenue interest for the Owner’s Leases will be
greater or equal to eighty one and one quarter percent (81.25%), after any and
all overriding royalty interests to all parties, inclusive of Owner and its
affiliates.

     10.3 Disclaimer of
Representations and Warranties. THE PARTIES HERETO MAKE NO, AND HEREBY
DISCLAIM ANY, REPRESENTATION OR WARRANTY, WHETHER EXPRESS OR IMPLIED, AND
WHETHER BY COMMON LAW, STATUTE, OR OTHERWISE EXCEPT AS EXPRESSLY SET FORTH IN
THIS ARTICLE 10.

ARTICLE 11

MISCELLANEOUS

     11.1
Assignment. Any Party may assign its interest under this
Agreement provided that such Party remains liable for or guarantees the
performance of its assignee and provided that such Party gives the other Parties
appropriate documentation evidencing such assignment. Any assignment made will
be subject to the terms and provisions of this Agreement. In addition, said
assignee will be required to ratify this Agreement.

14

     11.2 Governing
Law. This Agreement and other instruments executed in accordance
with it, except for assignments of lands, or the execution hereof shall be
governed by and interpreted according to the laws of the State of Texas. As to
assignments of the Owner’s Leases shall be governed by the laws of the State of
Kansas. The Parties agree to the jurisdiction of the courts of the State Kansas
and that venue for any action hereunder shall lie in state or federal courts
sitting in Sedgwick County, Kansas.

     11.4 Entire
Agreement. This Agreement, the documents to be executed hereunder, and
the exhibits attached hereto constitute the entire agreement between the
Parties, supersedes all prior agreements, understandings, negotiations and
discussions, whether oral or written, of the Parties, and there are no
warranties, representations or other agreements between the Parties except as
specifically set forth herein. No supplement, amendment, alteration,
modification, waiver or termination of the Agreement shall be binding unless
executed in writing by the Parties hereto. Notwithstanding anything contained
herein or therein to the contrary, this Agreement specifically supersedes,
replaces, and terminates the Term Sheet executed by the Parties dated July 26,
2013 and the “Drill to Earn” letter agreement dated October 1, 2013.

     11.5 Waiver.
No delay or omission by a Party in the exercise of any right, power or remedy
under this Agreement will impair any such right, power or remedy or operate as a
waiver thereof or of any other right, power or remedy then or thereafter
existing. No waiver of any of the provisions of the Agreement shall be deemed or
shall constitute a waiver of any other provisions hereof (whether or not
similar), nor shall such waiver constitute a continuing waiver unless otherwise
expressly provided.

     11.6 Captions;
Definition of “Including”. The captions in this Agreement are for
convenience only and shall not be considered a part of or affect the
construction or interpretation of any provision of this Agreement. The term
“including” or “includes”, as used herein, shall mean “including, without
limitation,” and “includes, without limitation”.

     11.7 Binding.
This Agreement shall be binding upon and inure to the benefit of the
Parties and their respective permitted successors, assigns and legal
representatives.

     11.8 Expenses.
Except as otherwise provided herein, each Party shall be solely
responsible for all expenses incurred by it in connection with this transaction
(including fees and expenses of its own counsel and accountants).

     11.9 Execution.
This Agreement may be executed in multiple original counterparts, all of
which shall together constitute a single agreement and each of which, when
executed, shall be binding for all purposes thereof on the executed Party, its
successors, legal representatives and assigns.

     11.10
Severability. If any term or other provision of this Agreement
is invalid, illegal or incapable of being enforced by any rule of law, all other
conditions and provisions of this Agreement shall nevertheless remain in full
force and effect so long as the economic or legal substance of the transactions
contemplated hereby is not affected in any materially adverse manner to any
Party.

15

     11.11 Further
Assurances. During the time in which this Agreement is in effect, the
Parties shall, at any time and from time to time, and without further
consideration, execute and deliver or use reasonable efforts to cause to be
executed and delivered such other instruments of conveyance and contract, and to
take such other actions as either party may reasonably request that effect the
intent of this Agreement.

     11.12 Not to be
Construed Against Drafter. The Parties acknowledge that they have had an
adequate opportunity to review each and every provision contained in this
Agreement, that they have participated equally in the drafting hereof and that
they have had adequate time to submit same to legal counsel for review and
comment. Based on said review and consultation, the Parties agree with each and
every term contained in this Agreement. Based on the foregoing, the Parties
agree that the rule of construction that a contract be construed against the
drafter, if any, shall not be applied in the interpretation and construction of
this Agreement.

     11.13 Third-Party
Beneficiaries. This Agreement is not intended to confer any rights or
remedies upon any Person other than the Parties and their respective successors,
legal representatives and permitted assigns.

     11.14 Subject to
Existing Agreements. This Agreement, any and all JOA’s, the Assigned
Properties and the Program Well Assignments shall be subject to all existing
agreements and obligations of the Owner that relate to or affect any of the
forgoing, including but not limited to any and all Existing Burdens.

     11.15 Attorneys’
Fees and Costs. If any action is commenced to recover any damages or
enforce any rights or obligations under this Agreement, then the prevailing
Party or Parties shall recover and the losing Party or Parties shall pay the
reasonable attorneys’ fees, costs and expenses incurred by the prevailing Party
or Parties at the trial and upon any appeals therefrom (including in any
bankruptcy proceeding), as determined by the respective courts.

     11.16 Time is of the
Essence. Time is of the essence of this Agreement.

16

     11.17 Investment
Representations. APH understands (a) that the interests evidenced by
this Agreement have not been registered under the United States Securities Act
of 1933, or any state securities laws (the “Securities Acts”), (b) that the
Owner have relied upon the fact that the interests are to be held by APH for
investment, (c) that exemption from registration under the Securities Acts may
not be available if the interests were acquired by APH with a view to
distribution, and (d) APH is an “accredited investor” as defined in Regulation D
adopted by the Securities and Exchange Commission. Accordingly, APH hereby
confirms to the Owner that it is acquiring the interests for its own account,
for investment and not with a view to the resale or distribution thereof. APH
agrees not to transfer, sell or offer for sale any or any portion of the
interests unless there is an effective registration or other qualification
relating thereto under the Securities Act of 1933 and under any applicable state
securities laws or unless APH delivers to the Owner, if any of the Owner
request, an opinion of counsel, that such registration or other qualification
under such Act and applicable state securities laws is not required in
connection with such transfer, offer or sale. APH understands that the Owner are
under no obligation to register the interests or to assist APH in complying with any
exemption from registration under the Securities Acts if APH should at a later
date, wish to dispose of the interests. Prior to acquiring the interests, APH
has made an investigation of the Owner and their respective businesses and has
had made available to it all information with respect thereto which it needed to
make an informed decision to acquire the interests contemplated herein. APH
considers itself to be an entity possessing experience and sophistication as an
investor which are adequate for the evaluation of the merits and risks of its
investment in the interests and transaction contemplated herein.

[Intentionally Left Blank]

17

     IN WITNESS WHEREOF, this
Participation Agreement, effective as of the date and year first written above,
has been duly executed and delivered by the duly authorized representative of
each Party as of the date written below each such Party’s name.

WARPAINT KANSAS, LP

By: Oklaunion Management, LP, its General Partner 
By:
Warpaint Resources, LLC, its General Partner

18Enertopia Corp.: Exhibit 10.1 - Filed by newsfilecorp.com

STOCK OPTION AGREEMENT 

ENERTOPIA CORP. 

THIS AGREEMENT is entered into as of the 5th day of
November, 2013 (the “Date of Grant”) 

BETWEEN: 

  
    
      
        ENERTOPIA CORP., a company incorporated pursuant to the
          laws of the State of Nevada, of Suite 950 1130 West Pender, Vancouver, BC V6E
          4A4 

        (the “Company”) 

      

    

  

AND: 

  
    
      
        (the “Optionee”) 

      

    

  

WHEREAS: 

A.                
The Board of Directors of the Company (the “Board”) has approved and adopted the
2011 Stock Option Plan (the “Plan”), pursuant to which the Board is authorized
to grant to employees and other selected persons stock options to purchase
common shares of the Company (the “Common Stock”); 

B.                
The Plan provides for the granting of stock options that either (i) are intended
to qualify as “Incentive Stock Options” within the meaning of Section 422 of the
Internal Revenue Code of 1986, as amended (the “Code”), or (ii) do not qualify
under Section 422 of the Code (“Non-Qualified Stock Options”); and 

C.                
The Board has authorized the grant to the Optionee of options to purchase a
total of 250,000 shares of Common Stock (the “Options”), which Options
are intended to be (select one): 

[   
 ]      Incentive Stock Options; 

[ X ]     
Qualified Stock Options 

NOW THEREFORE, the Company agrees to offer to the Optionee the
option to purchase, upon the terms and conditions set forth herein and in the
Plan, XXX shares of Common Stock. Capitalized terms not otherwise defined
herein shall have the meanings ascribed thereto in the Plan. 

ITEM
1           Exercise price.
The exercise price of the options shall be us $0.09 per share. 

ITEM
2           Limitation on the
number of shares. If the options granted hereby are incentive stock options, the
number of shares which may be acquired upon exercise thereof is subject to the
limitations set forth in section 5.1 of the plan. 

- 2 – 

ITEM 3          
Vesting schedule. The options shall vest in accordance with exhibit a. 

ITEM 4          
Options not transferable. The options may not be transferred, assigned, pledged
or hypothecated in any manner (whether by operation of law or otherwise) other
than by will, by applicable laws of descent and distribution or, in the case of
a non-qualified stock option, pursuant to a qualified domestic relations order,
and shall not be subject to execution, attachment or similar process;
provided, however, that if the options represent a non-qualified stock
option, such option is transferable without payment of consideration to
immediate family members of the optionee or to trusts or partnerships
established exclusively for the benefit of the optionee and optionee’s immediate
family members. Upon any attempt to transfer, pledge, hypothecate or otherwise
dispose of any option or of any right or privilege conferred by the plan
contrary to the provisions thereof, or upon the sale, levy or attachment or
similar process upon the rights and privileges conferred by the plan, such
option shall thereupon terminate and become null and void. 

ITEM 5          
Investment intent. By accepting the options, the optionee represents and agrees
that none of the shares of common stock purchased upon exercise of the options
will be distributed in violation of applicable federal and state laws and
regulations. In addition, the company may require, as a condition of exercising
the options, that the optionee execute an undertaking, in such a form as the
company shall reasonably specify, that the stock is being purchased only for
investment and without any then-present intention to sell or distribute such
shares. 

ITEM 6          
Termination of employment and options. Vested options shall terminate, to the
extent not previously exercised, upon the occurrence of the first of the
following events: 

	 	(A) 	
      Expiration. Five (5) years from the date of
  grant.

	 	 	 
	 	(B) 	
      Termination for cause. The date of the first discovery by
      the company of any reason for the termination of an optionee’s employment
      or contractual relationship with the company or any related company for
      cause (as determined in the sole discretion of the plan administrator),
      and, if an optionee’s employment is suspended pending any investigation by
      the company as to whether the optionee’s employment should be terminated
      for cause, the optionee’s rights under this agreement and the plan shall
      likewise be suspended during the period of any such
  investigation.

	 	 	 
	 	(C) 	
      Termination due to death or disability. The expiration of
      one (1) year from the date of the death of the optionee or cessation of an
      optionee’s employment or contractual relationship by reason of disability
      (as defined in section 5.1(g) of the plan). If an optionee’s employment or
      contractual relationship is terminated by death, any option held by the
      optionee shall be exercisable only by the person or persons to whom such
      optionee’s rights under such option shall pass by the optionee’s will or
      by the laws of descent and distribution.

	 	 	 
	 	(D) 	
      Termination for any other reason. The expiration of
      ninety (90) days from the date of an optionee’s termination of employment
      or contractual relationship with the company or any related corporation
for any reason whatsoever other than termination of service as a director,
cause, death or disability (as defined in section 5.1(g) of the plan). 

- 3 – 

Each unvested Option granted pursuant hereto shall terminate
immediately upon termination of the Optionee’s employment or contractual
relationship with the Company for any reason whatsoever, including Disability
unless vesting is accelerated in accordance with Section 5.1(f) of the Plan.

ITEM 7          
Stock. In the case of any stock split, stock dividend or like change in
the nature of shares of stock covered by this agreement, the number of shares
and exercise price shall be proportionately adjusted as set forth in section
5.1(m) of the plan. 

ITEM 8          
Exercise of option. Options shall be exercisable, in full or in part, at
any time after vesting, until termination; provided, however, that any
optionee who is subject to the reporting and liability provisions of section 16
of the securities exchange act of 1934 with respect to the common stock
shall be precluded from selling or transferring any common stock or other
security underlying an option during the six (6) months immediately following
the grant of that option. If less than all of the shares included in the vested
portion of any option are purchased, the remainder may be purchased at any
subsequent time prior to the expiration of the option term. No portion of any
option for less than fifty (50) shares (as adjusted pursuant to section 5.1(m)
of the plan) may be exercised; provided, that if the vested portion of any
option is less than fifty (50) shares, it may be exercised with respect to all
shares for which it is vested. Only whole shares may be issued pursuant to an
option, and to the extent that an option covers less than one (1) share, it is
unexercisable. 

Each exercise of the Option shall be by means of delivery of a
notice of election to exercise (which may be in the form attached hereto as
Exhibit B) to the President of the Company at its principal executive
office, specifying the number of shares of Common Stock to be purchased and
accompanied by payment in cash by certified check or cashier’s check in the
amount of the full exercise price for the Common Stock to be purchased. In
addition to payment in cash by certified check or cashier’s check, an Optionee
or transferee of an Option may pay for all or any portion of the aggregate
exercise price by complying with one or more of the following alternatives: 

	 	(A) 	
      By delivering to the company shares of common stock
      previously held by such person, duly endorsed for transfer to the company,
      or by the company withholding shares of common stock otherwise deliverable
      pursuant to exercise of the option, which shares of common stock received
      or withheld shall have a fair market value at the date of exercise (as
      determined by the plan administrator) equal to the aggregate purchase
      price to be paid by the optionee upon such exercise; or

	 	 	 
	 	(B) 	
      By complying with any other payment mechanism approved by
      the plan administrator at the time of
exercise.

- 4 – 

It is a condition precedent to the issuance of shares of Common
Stock that the Optionee execute and/or deliver to the Company all documents and
withholding taxes required in accordance with Section 5.1 of the Plan. 

ITEM 9          
Holding period for incentive stock options. In order to obtain the tax
treatment provided for incentive stock options by section 422 of the code, the
shares of common stock received upon exercising any incentive stock options
received pursuant to this agreement must be sold, if at all, after a date which
is later of two (2) years from the date of this agreement is entered into or one
(1) year from the date upon which the options are exercised. The optionee agrees
to report sales of shares prior to the above determined date to the company
within one (1) business day after such sale is concluded. The optionee also
agrees to pay to the company, within five (5) business days after such sale is
concluded, the amount necessary for the company to satisfy its withholding
requirement required by the code in the manner specified in section 5.1(l) of
the plan. Nothing in this section 9 is intended as a representation that common
stock may be sold without registration under state and federal securities laws
or an exemption therefrom or that such registration or exemption will be
available at any specified time. 

ITEM 10         Resale
restrictions may apply. Any resale of the shares of common stock received
upon exercising any options will be subject to resale restrictions contained in
the securities legislation applicable to the optionee. The optionee acknowledges
and agrees that the optionee is solely responsible (and the company is not in
any way responsible) for compliance with applicable resale restrictions. 

ITEM 11         Subject
to 2011 stock option plan. The terms of the options are subject to the
provisions of the plan, as the same may from time to time be amended, and any
inconsistencies between this agreement and the plan, as the same may be from
time to time amended, shall be governed by the provisions of the plan, a copy of
which has been delivered to the optionee, and which is available for inspection
at the principal offices of the company. 

ITEM 12      
  Professional advice. The acceptance of the options and the
sale of common stock issued pursuant to the exercise of options may have
consequences under federal and state tax and securities laws which may vary
depending upon the individual circumstances of the optionee. Accordingly, the
optionee acknowledges that he or she has been advised to consult his or her
personal legal and tax advisor in connection with this agreement and his or her
dealings with respect to options. Without limiting other matters to be
considered with the assistance of the optionee’s professional advisors, the
optionee should consider: (a) whether upon the exercise of options, the optionee
will file an election with the internal revenue service pursuant to section
83(b) of the code and the implications of alternative minimum tax pursuant to
the code; (b) the merits and risks of an investment in the underlying shares of
common stock; and (c) any resale restrictions that might apply under applicable
securities laws. 

ITEM 13         No
employment relationship. Whether or not any options are to be granted under
this plan shall be exclusively within the discretion of the plan administrator,
and nothing contained in this plan shall be construed as giving any person any
right to participate under this plan. The grant of an option shall in no way
constitute any form of agreement or understanding binding on the company or any
related company, express or implied, that the company or any related company
will employ or contract with an optionee, for any length of time, nor shall it
interfere in any way with the company’s or, where applicable, a
related company’s right to terminate optionee’s employment at any time, which
right is hereby reserved. 

- 5 – 

ITEM 14         Entire
agreement. This agreement is the only agreement between the optionee and the
company with respect to the options, and this agreement and the plan supersede
all prior and contemporaneous oral and written statements and representations
and contain the entire agreement between the parties with respect to the
options. 

ITEM 15         Notices.
Any notice required or permitted to be made or given hereunder shall be
mailed or delivered personally to the addresses set forth below, or as changed
from time to time by written notice to the other: 

	 	The Company: 
	 	  
	 	                                                          
      Enertopia Corp. 
	 	           
                         
                         
             Suite 950 1130 West Pender Street 
	 	           
                         
                         
             Vancouver, BC V6E 4A4 
	 	           
                         
                         
             Attention: President 
	 	  
	 	With a copy to: 
	 	  
	 	           
                         
                         
             W.L. Macdonald Law Corporation 
	 	           
                         
                         
             400 – 570 Granville Street 
	 	           
                         
                         
             Vancouver, British Columbia V6C 3P1 
	 	           
                         
                         
             Attention: William Macdonald 
	 	
	 	The Optionee: 
	 	 
	 	                                                           
      _______________________________________
	 	                                                           
      _______________________________________
	 	                                                           
      _______________________________________
	 	                                                           
      _______________________________________

ENERTOPIA CORP. 

 

	Per: 	 	 
	 	Authorized Signatory 	 
	 	  	 
	 	  	 
	 	  	 
	 	[  ] 	 

- 6 – 

EXHIBIT A

TERMS OF THE OPTION 

Name of the Optionee:

	Date of Grant: 	November 18, 2013 
	 	 
	 	 
	Designation: 	Qualified Stock Options 
	 	 
	 	 
	1.        Number of
      Options granted: 	XXX stock options 
	 	 
	 	 
	2.        Purchase
      Price: 	$0.09 per share 
	 	 
	 	 
	3.        Vesting Date:
    	XXX options on November 18, 2013; 
	 	  
	 	 
	4.        Expiration
      Date: 	November 18, 2018 

- 7 – 

EXHIBIT B

To: 

Enertopia Corp. 
Suite 950
1130 West Pender 
Vancouver, BC V6E 4A4 
Attention: President 

Notice of Election to Exercise

This Notice of Election to Exercise shall constitute proper
notice pursuant to Section 5.1(h) of Enertopia Corp.’s (the “Company”) 2011
Stock Option Plan (the “Plan”) and Section 8 of that certain Stock Option
Agreement (the “Agreement”) dated as of the _______ day of __________________,
20___, between the Company and the undersigned. 

The undersigned hereby elects to exercise Optionee’s option to
purchase __________________ shares of the common stock of the Company at a price
of US$0.08 per share, for aggregate consideration of US$__________, on the terms
and conditions set forth in the Agreement and the Plan. Such aggregate
consideration, in the form specified in Section 8 of the Agreement, accompanies
this notice. 

The Optionee hereby directs the Company to issue, register and
deliver the certificates representing the shares as follows: 

	 	 	 
	  Registration
      Information: 	 	Delivery Instructions: 
	 	 	 
	 	 	 
	  Name to
      appear on certificates 	 	Name
  
	 	 	 
	 	 	 
	  Address 	 	Address
    
	  	 	  
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	  	 	Telephone Number 
	 	 	 

- 8 – 

DATED at ____________________________________, the _______ day
of ________________________, 20___. 

 

	 	 
	 	(Name of Optionee – Please type or print)

	 	 
	 	 
	 	(Signature and, if applicable, Office) 
	 	 
	 	 
	 	(Address of Optionee) 
	 	 
	 	 
	 	(City, State, and Zip Code of Optionee)

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