(2014) SUBSCRIPTION FOR COMMON SHARES CARLISLE … · Carlisle Goldfields Limited Subscription Agreement for Common Shares Page 3 of 16 "Outside Date" means November 28, 2014 (or

TO:

SUBSCRIPTION FOR COMMON SHARES

CARLISLE GOLDFIELDS LIMITED (the "Corporation")

CANADA (2014)

Tlie undersigned (the "Subscriber") hereby subscribes for and agrees to purchase tlie number of common shares (each a "Common Share") of tlie Corporation for tlie aggregate subscription price set fortli below (tlie "Aggregate Subscription Price") at a price of $0.08 per Common Share, upon and subject to the terms and conditions set foith in "Terms and Conditions of Subscription for Common Shares of Carlisle Goldfields Limited" attached hereto (together widi this page and the attached Schedules, the "Subscription Agreemenf'). In addition to this face page, the Subscriber must also complete Schedule "A" attached hereto.

Full Legal Namejif^Siihscrihe.r (please print)

By: Authorized Signature

Official Title or Capacity (please print)

Name of Signatory (please print name of individual whose signature appears above if different than name of Subscriber)

W O \ U q I riber's Ad^^ess ^ Subscriber's Addiess (including postal code)

"Tri.i^-T^v'VrV-D . M tT•4'

Telephone Number (including area code)

P A / t @ ( l A L v i ubaM. (rfYVO Email Address L)

By executing this Subscription, you are consenting (on your behalf and, if applicable, on behalf of the beneficial purchaser for whom you are contracting), to the collection, use and disclosure of personal information in the manner described in the Privacy Notice on page 9 of this Subscription, as well as the indirect collection by the Ontario Securities Commission of the Information as described in Subsection 3(y). Register the Common Shares as follows

Name

Account reference, if applicable

Address (including postal code)

70.600.000 Common Shares at $0.08 each

Aggregate Subscription Price: Cdn $ 5.648.000

If the Subscriber is signing as agent for a principal and is not deemed to be purchasing as principal under National Instrument 45-106 - Prospectus and Registration Exemptions ("NI 45-106"), by virtue of being either (i) a trust company or trust corporation acting on behalf of a fully managed account managed by the trust company or trust corporation; or (ii) a person acting on behalf of a fully managed account managed by it, and in each such case satisfying the criteria set forth in NI 45-106, complete the following ("Disclosed Beneficial Purchaser"):

(Name of Principal)

(Principal's Address)

(Principal's Telephone Number)

(Principal's E-mail Address)

Deliver the Securities as follows:

Name

Account reference, if applicable

Contact Name

Address (including postal code)

Telephone Number (including area code)

ACCEPTANCE: The Coiporation hereby accepts the subscription as set forth above on the "Terms and Conditions of Subscription of Common Shares of Carlisle Goldfields Limited" contained in this Subscription Agreement and the Corporation represents, warrants and covenants to the Subscriber that the representations, warranties and covenants made by the Corporation herein are true and correct as of the Closing Date (as defined herein).

,1^ CARLI^l.E GOT.DjETEKOS LIMITED November, 2014

Per: Authorized Signing Officer

This is the first page of an agreement comprised of 16 pages.

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TERMS AND CONDITIONS OF THE SUBSCRIPTION FOR COMMON SHARES OF CARLISLE GOLDFIELDS LIMITED

1. Interpretation

In this Subscription Agreement:

"Aggregate Subscription Price" shall have the meaning ascribed thereto on the face page hereof;

"business day" means any day, other than a Saturday, a Sunday or a statutory holiday in the Province of Ontario;

"Closing" shall have the meaning ascribed thereto in Section 9 hereof;

"Closing Date" shall have the meaning ascribed thereto in Section 9 hereof;

"Closing Time" shall have the meaning ascribed thereto in Section 9 hereof;

"Common Share" means a common share in the capital of the Corporation, as constituted on the Closing Date;

"Control" means the possession, directly or indirectly, of the power to direct the management and policies of a person whether through the ownership of Voting Securities or otherwise, and the terms "Controlling" and "Controlled" have meanings correlative to the foregoing;

"Corporation" means Carlisle Goldfields Limited, a corporation existing under the OBCA;

"Effective Date" means the date on which this Subscription Agreement is entered into;

"Exchange" means the Toronto Stock Exchange or such other stock exchange on which the Common Shares are listed and posted for trading at the applicable time;

"Investor Rights Agreement" means the investor rights agreement dated November 10, 2014 between the Corporation and the Subscriber;

"Johnson & Johnson Option" means the option held by the Corporation to acquire a 100% interest in the Johnson & Johnson 1 Gold Project pui'suant to the letter agreement dated April 15, 2013 between Peter C. Dunlop and the Corporation;

"Joint Venture Agreement" means the joint venture agreement dated November 10, 2014 between the Corporation and the Subscriber;

"Last Hope Option" means the option held by the Corporation to acquire a 100% interest in the Last Hope Gold Project pursuant to the letter agreement dated October 21, 2009 between Peter C. Dunlop and 5918147 Manitoba Inc., as amended;

"LOI" means the document titled "AuRico/Carlisle Investment Tenu Sheet" executed by the Subscriber and the Corporation providing for among other things, exclusivity, as amended on October 8, 2014 (and agreed to and accepted on October 9, 2014) and as further amended (and agreed to and accepted) on October 29, 2014;

"OBCA" means the Business Corporations Act (Ontario), as amended fi'om time to time;

"Offering" has the meaning as defined in Section 2 below;

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"Outside Date" means November 28, 2014 (or such later date as the Subscriber and the Coiporation may agree);

"PCMLA" means the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada), as amended from time to time;

"Required Consents" means (i) the conditional approval for the listing of the Common Shares on the Toronto Stock Exchange upon the expiry of the hold periods required under applicable Canadian securities laws, such approval to be subject only to the filing of the required documents and payment of the required fees within the time stipulated by the Toronto Stock Exchange, and (ii) the consents identified as required to be obtained by the Corporation on Schedule E to the Joint Venture Agreement with respect to the performance by the Corporation of its obligations under the Joint Venture Agreement;

"Subscriber" means the person or company identified as the Subscriber on the face page of this Subscription Agreement;

"Subscription Agreement" means this subscription agreement, together with the face page hereof and the schedules attached hereto, duly and properly executed and delivered by a Subscriber and accepted by the Corporation;

"Take-Over Bid" shall have the meaning ascribed thereto in Section 11(d) hereof

"United States" means the United States of America, its territories, any state of the United States and the District of Columbia;

"U.S. Securities Act" means the United States Securities Act of 1933, as amended;

"Voting Securities" means securities which carry a right to vote in all circumstances and does not include securities which carry the right to vote only after a default or series of defaults in the payment of dividends; and

words importing the singular include the plural and vice versa and words importing gender include all genders.

2. The Offering. The Corporation is offering for sale that number of Common Shares being subscribed for by the Subscriber (the "Offering")

3. Representations, Warranties and Covenants of the Subscriber. By executing this Subscription Agreement, the Subscriber represents, warrants and covenants to the Corporation (and acknowledges that the Corporation and its counsel are relying thereon) both as of the date hereof and as of the Closing Date that:

(a) the Subscriber has the requisite power, authority, legal capacity and competence to execute and deliver this Subscription Agreement, the LOI, the Joint Venture Agreement and the Investor Rights Agreement, to perform all of the Subscriber's obligations hereunder and thereunder, and to undertake all actions required of the Subscriber hereunder and thereunder, and all necessaiy approvals of its directors, partners, shareholders, trustees or others with respect to such matters have been given or obtained;

(b) the Subscriber is duly incorporated and validly subsisting under the laws of its jurisdiction of formation and, other than being extra-provincially registered in Manitoba, is qualified to carry on business in each jurisdiction in respect of which the carrying on of the activities contemplated hereby and in the Joint Venture Agreement make such qualification necessary;

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(c) each of this Subscription Agreement, the Joint Venture Agreement and the Investor Rights Agreement has been duly and validly authorized, executed and delivered by, and constitutes a legal, valid, binding and enforceable obligation of, the Subscriber, subject to such limitations and prohibitions as may exist or may be enacted in applicable laws relating to bankruptcy, insolvency, liquidation, moratorium, reorganization, arrangement or winding-up and other laws, rules and regulations of general application affecting the rights, powers, privileges, remedies and/or interests of creditors generally; no approval, authorization, consent, license or registration of or with any governmental, judicial or other authority or other person is required in connection with the execution or performance by the Subscriber of this Subscription Agi-eement, the Joint Venture Agreement or the Investor Rights Agreement (other than extra-provincial registration in Manitoba);

(d) the execution, delivery and performance by the Subscriber of this Subscription Agreement, the Joint Venture Agreement and the Investor Rights Agreement and the completion of the transactions contemplated hereby and thereby do not and will not result in a violation of any law, regulation, order or ruling applicable to the Subscriber, and do not and will not constitute a breach of or default under any of the Subscriber's constating documents or any agreement to which the Subscriber is a party or by which it is bound;

(e) the Subscriber confirms that the Subscriber:

(i) has such knowledge in financial and business affaii's as to be capable of evaluating the merits and risks of its investment in the Common Shares;

(ii) is capable of assessing the proposed investment in the Common Shares as a result of the Subscriber's own experience or as a result of advice received from a person registered under applicable securities legislation;

(iii) is aware of the characteristics of the Common Shares and the risks relating to an investment therein; and

(iv) is able to bear the economic risk of loss of its investment in the Common Shares;

(f) the Subscriber understands that no securities commission, stock exchange, governmental agency, regulatory body or similar authority has made any finding or determination or expressed any opinion with respect to the merits of investing in the Common Shares and that there is no government or other insurance covering the Common Shares;

(g) the Subscriber acknowledges that no prospectus has been filed by the Corporation with any securities commission or similar regulatory authority in any jurisdiction in connection with the issuance of the Common Shares and the issuance is exempted from the prospectus requirements available under the provisions of applicable securities laws and as a result:

(i) the Subscriber may be restricted fi-om using some of the civil remedies otherwise available under applicable securities laws;

(ii) the Subscriber may not receive information that would otherwise be required to be provided to it under applicable securities laws; and

(iii) the Corporation is relieved fi-om certain obligations that would otherwise apply under applicable securities laws;

(h) the Subscriber confrnms that neither the Corporation nor any of its directors, employees, officers, agents, advisors or affiliates, has made any representations (written or oral) to the Subscriber:

(i) regarding the future value of the Common Shares;

(ii) that any person will resell or repurchase the Common Shares; or

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(iii) that any person will refund the purchase price of the Common Shares;

(i) the Subscriber confirms that it has been advised to consult its own legal and financial advisors with respect to the suitability of the Common Shares as an investment for the Subscriber and the resale resfrictions and "hold periods" to which the Common Shares are subject under applicable securities legislation, and the Subscriber has not relied upon any statements relating to suitability made by or purporting to have been made on behalf of the Corporation in deciding to subscribe for Common Shares hereunder;

(j) the Subscriber is resident in the jurisdiction indicated on the face page of this Subscription Agreement as the "Subscriber's Address" and the purchase by and sale to the Subscriber of the Common Shares;

(k) the Subscriber understands that it may not be able to resell the Common Shares, except in accordance with limited exemptions available under applicable securities legislation and regulatory policy, and that the Subscriber is solely responsible for (and neither the Coiporation nor any other party is in any way responsible for) the Subscriber's compliance with applicable resale restrictions; the Subscriber will not resell any of the Common Shares except in accordance with the provisions of applicable securities legislation;

(1) the Subscriber understands that the sale of the Common Shares is conditional upon such sale being exempt from the requirements to file and obtain a receipt for a prospectus and from the requirement to sell securities through a registered dealer, or upon the issuance of such orders, consents or approvals as may be required to enable such sale to be made without complying with such requirements, and that as a consequence of acquiring the Common Shares pursuant to such exemptions, certain protections, rights and remedies provided by applicable securities legislation and the benefit of any protection that might have otherwise been available by having a dealer involved in the sale, may not be available to the Subscriber in connection with the purchase and sale of the Common Shares hereunder;

(m) the Subscriber imderstands that any certificates representing the Common Shares will bear a legend indicating that the resale of such securities is restricted, substantially as follows:

"UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY MUST NOT TRADE THE SECURITY BEFORE [four months and one day from the Closing Date],

THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE LISTED ON THE TORONTO STOCK EXCHANGE ("TSX"); HOWEVER, THE SAID SECURITIES CANNOT BE TRADED THROUGH THE FACILITIES OF THE TSX SINCE THEY ARE NOT FREELY TRANSFERABLE, AND CONSEQUENTLY, ANY CERTIFICATE REPRESENTING SUCH SECURITIES IS NOT "GOOD DELIVERY" IN SETTLEMENT OF TRANSACTIONS ON THE TSX."

(n) the Subscriber has relied solely upon this Subscription Agreement, the Joint Venture Agreement, the Investor Rights Agreement, the LOI and publicly available information relating to the Corporation filed by the Corporation on SEDAR and not upon any oral or other written representation as to fact or otherwise made by or on behalf of the Corporation or any advisors thereof, such publicly available information not having been subjected to independent investigation or verification by the Corporation or any advisors thereof and acknowledges that legal counsel to each of the Corporation and its advisors are acting as legal counsel to the Corporation and its advisors, respectively, and not as legal coimsel to the Subscriber;

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(o) the Subscriber is aware that the Common Shares have not been and will not be registered under the U.S. Securities Act or the securities legislation of any State in the United States and that the Securities may not be offered or sold directly or indirectly in the United States without registration under the U.S. Securities Act or compliance with requirements of an exemption from regisfration and the Subscriber acknowledges that the Corporation has no present intention of filing a registration statement under the U.S. Securities Act in respect of the Common Shares;

(p) the Subscriber is not a "U.S. Person" (as that term is defined by Regulation S under the U.S. Securities Act, which definition includes, but is not limited to, an individual resident in the United States, an estate or trust of which any executor or administrator or trustee, respectively, is a U.S. Person and any partnership or corporation organized or incorporated imder the laws of the United States) and the Subscriber is not acquiring the Securities for the account or benefit of a U.S. Person or a person in the United States;

(q) the Common Shares have not been offered to the Subscriber in the United States, and the individuals making the offer to purchase the Common Shares and executing and delivering this Subscription Agreement on behalf of the Subscriber were not in the United States when the offer was placed and this Subscription Agreement was executed and delivered;

(r) the Subscriber undertakes and agrees that it will not offer or sell any of the Common Shares in the United States unless such securities are registered under the U.S. Securities Act and the securities laws of all applicable states of the United States, or an exemption from such registration requirements is available;

(s) if required by applicable securities legislation or regulatory policy or by any securities commission, stock exchange or other regulatory authority, the Subscriber will execute, deliver, file and otherwise assist the Corporation in filing such reports, undertakings and other documents with respect to the issue of the Common Shares, as may be required or requested by the Corporation;

(t) the Subscriber is not acting jointly or in concert with any other person or company for the purposes of acquiring Common Shares of the Corporation pursuant to this Subscription Agreement;

(u) the Subscriber does not own any Common Shares or other securities of the Corporation and other than the securities subscribed for by it tmder this Subscription Agreement or as permitted to be acquired by it tmder the Investor Rights Agreement, and the Subscriber does not own or have the right to acquire any other securities of the Corporation;

(v) the funds representing the Aggregate Subscription Price which will be advanced by the Subscriber to the Corporation hereunder will not represent proceeds of crime for the purposes of the PCMLA and the Subscriber acknowledges that the Corporation may in the future be required by law to disclose the Subscriber's name and other information relating to this Subscription Agreement and the Subscriber's subscription hereunder, on a confidential basis, pursuant to the PCMLA. To the best of the knowledge of the Subscriber; (a) none of the subscription funds to be provided by the Subscriber: (i) have been or will be derived from or related to any activity that is deemed criminal under the laws of Canada, the United States or any other jurisdiction or (ii) are being tendered on behalf of a person or entity who has not been identified to the Subscriber; and (b) the Subscriber shall promptly notify the Corporation if the Subscriber discovers that any of such representations ceases to be untrue, and will provide the Corporation with appropriate information in cormection therewith;

(w) the Subscriber acknowledges that the Corporation may complete additional financings in the future in order to develop the business of the Corporation and to fund its ongoing development. There is no assurance that such financing will be available or, if available, available on reasonable

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terms. Any such future financings may have a dilutive effect on current or prospective shareholders, including the Subscriber. If such future financings are not available, the Corporation may be unable to fund its ongoing development and the lack of capital resources may result in the failure of its business venture; and

(x) this Subscription Agreement and the schedules hereto require the Subscriber to provide certain personal information to the Corporation and its legal counsel. Such information is being collected by the Corporation and its legal counsel for the purposes of completing the Offering described herein, which includes, without limitation, determining the Subscriber's eligibility to purchase the Common Shares under applicable securities legislation, preparing and registering certificates representing the Common Shares to be issued to the Subscriber and completing filings required by any stock exchange, securities commission, securities regulatory authority or taxation authority. Certain securities commissions have been granted the authority to indirectly collect this personal information pursuant to securities legislation and this personal information is also being collected for the purpose of administration and enforcement of securities legislation. In Ontario, the Administrative Support Clerk, Suite 1903, Box 55, 20 Queen Street West, Toronto Ontario, M5H 3S8, Telephone (416) 593-3684, Facsimile: (416) 593-8252 is the public official who can answer questions about the indirect collection of personal information. The Subscriber's personal information may be disclosed by the Corporation or its respective counsel to: (a) stock exchanges, secmities commissions or securities regulatory authorities; (b) the Corporation's registrar and transfer agent; (c) taxation authorities; (d) any of the other parties involved in the Offering, including legal counsel. In addition, the Corporation will be providing the following information to the Ontario Securities Commission and other regulatory authorities: (a) the full name, residential address and telephone number of the Subscriber; (b) the number and type of Securities purchased by the Subscriber; (c) the total purchase price for the Common Shares; (d) the statutory exemption relied upon by the Corporation; and (e) the date of distribution of the Common Shares (collectively, such information is hereinafter referred to as the "Information"). By executing this Subscription Agreement, the Subscriber is deemed to be authorizing and consenting to the foregoing collection (including the indirect collection of personal information), use and disclosure of the Subscriber's personal information and the Information as set forth above. The Subscriber also consents to the filing of copies or originals of any of the Subscriber's documents described in this Subscription Agreement, as well as the Information, as may be required to be filed with any stock exchange, securities commission or securities regulatoiy authority in connection with the transaction contemplated hereby.

4. Timeliness of Representations, etc. The Subscriber and the Corporation agree that the representations, warranties and covenants contained herein (or incorporated by reference herein) will be true and correct both on execution of this Subscription Agreement and as of the Closing Time and the representations and warranties in the Joint Venture Agreement and Investor Rights Agreement will be true and correct as of the Closing Time and will survive the completion of the issuance of the Common Shares and any subsequent disposition by the Subscriber of any such Common Shares; provided that nothing herein shall be interpreted to extend the survival periods of the representations and wamanties agreed to in the Joint Venture Agreement and the Investor Rights Agreement.

5. Indemnity. The Subscriber acknowledges that the Corporation and its legal counsel are relying upon the representations, warranties and covenants of the Subscriber set forth herein in determining the eligibility (from a securities law perspective) of the Subscriber (or, if applicable, the eligibility of another on whose behalf the Subscriber is contracting hereunder to subscribe for Common Shares) to purchase Common Shares under the Offering, and hereby agrees to indemnify the Corporation and its directors, officers, employees, advisers, affiliates and agents (including their respective legal counsel), and each of them, against all losses (other than loss of profits), claims, costs, expenses, damages or liabilities that they or any of them may suffer or incur as a result of or in connection with their reliance on such representations, warranties and covenants. The Subscriber undertakes to immediately notify the Corporation of any change in any statement or other information relating to the Subscriber set forth herein that occurs prior to the Closing Time and to send any such notice to the Corporation at 401 Bay Street, Suite 2702, Toronto,

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Ontario, M5H 2Y4. The Corporation acknowledges that the Subscriber is relying upon the representations, warranties and covenants of the Corporation set forth in this Subscription Agreement (or incorporated by reference in this Subscription Agreement), in the Joint Venture Agreement, the LOI and the Investor Rights Agreement in its decision to subscribe for and piu'chase the Common Shares and the Corporation hereby agrees to indemnify the Subscriber and its directors, officers, employees, advisers, affiliates and agents (including their respective legal counsel), and each of them, against all losses (other than loss of profits), claims, costs, expenses, damages or liabilities that they or any of them may suffer or incur as a result of or in connection with their reliance on such representations, warranties and covenants.

6. Representations of the Corporation. The Corporation (i) hereby represents, warrants and covenants to the Subscriber, and acknowledges that the Subscriber is relying thereon that the representations and warranties made by it under the Joint Venture Agreement and the Investor Rights Agreement will be true and correct on the Closing Date and (ii) hereby represents, warrants and covenants to the Subscriber, both as of the date hereof and as of the Closing Date, and acknowledges that the Subscriber is relying thereon, that:

(a) the Corporation is validly subsisting under the laws of the Province of Ontario and is qualified to carry on business in the Province of Ontario and in each other jurisdiction, including Manitoba, in respect of which the carrying on of the activities contemplated hereby make such qualification necessary;

(b) the Corporation has complied or will prior to the Closing Time comply with all applicable corporate and securities laws required to be complied with on/or prior to the Closing Time and which are applicable to it in connection with the offer, sale and issuance of the Common Shares to be purchased hereunder;

(c) no order preventing, ceasing or suspending trading in any securities of the Corporation or prohibiting the issue and sale of securities by the Corporation has been issued and remains outstanding and no proceedings for any such purposes have been instituted or, to the best of the knowledge of the Corporation, are pending, contemplated or threatened;

(d) each of this Subscription Agreement, the LOI, the Joint Venture Agreement and the Investor Rights Agreement constitute a legal, valid and binding obligation of the Corporation enforceable in accordance with its terms, subject to such limitations and prohibitions as may exist or may be enacted in applicable laws relating to bankruptcy, insolvency, liquidation, moratorium, reorganization, ainangement or winding-up and other laws, rules and regulations of general application affecting the rights, powers, privileges, remedies and/or interests of creditors generally;

(e) the execution, delivery and performance of each of this Subscription Agreement, the LOI, the Joint Venture Agreement and the Investor Rights Agreement by the Corporation, and the issue of the Common Shares do not and will not constitute a breach of or default under the constating documents of the Corporation, or any law, regulation, order or ruling applicable to the Corporation, or, except for the Required Consents, any agreement to which the Corporation is a party or by which it is bound;

(f) except for the Required Consents, no approval, authorization, consent, license or registration of or with any governmental, judicial or other authority or other person is required in connection with the execution or performance by the Corporation of this Subscription Agreement, the LOI, the Joint Venture Agreement or the Investor Rights Agreement;

(g) the Corporation will use its best efforts to obtain the Required Consents of the Exchange by the Closing Date and the remaining Required Consents as soon as practicable following the Closing Date and shall provide to the Subscriber all correspondence given by the Corporation or received

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by the Corporation in connection with such Required Consents promptly after such correspondence is given or received;

(h) the Corporation has the full corporate right, power and authority to enter into each of this Subscription Agreement, the LOI, the Joint Venture Agreement and the Investor Rights Agreement and to perform its obligations hereunder and thereunder, including, without limitation, to issue the Common Shares pursuant to the terms of this Subscription Agreement;

(i) this Subscription Agreement, the LOI, the Joint Venture Agreement and the Investor Rights Agreement and the performance by the Corporation of its obligations hereunder and thereunder have been duly authorized by all necessary corporate action on the part of the Corporation;

(j) there is no litigation existing or, to the knowledge of the Corporation, pending or threatened against the Corporation which would materially adversely affect the operations, prospects or financial condition of the Corporation;

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

(I) there is no action, proceeding or investigation pending or, to the knowledge of the Corporation, threatened against or affecting the Corporation, at law or in equity or before or by any federal, provincial, state, municipal or other governmental department, commission, board or agency, domestic or foreign, which in any way materially adversely affects the Corporation or the condition (financial or otherwise) of the Corporation;

(m) it has filed all documents or information required to be filed by it under applicable securities laws and applicable Exchange rules. Each such document or item of information filed by the Corporation under such laws and rules, as of its date, did not contain any unti'ue statement of a material fact or omit to state 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 at the time at which it was filed with applicable securities regulators subject to subsequent filings made prior to the date hereof to update, correct or clarify such statements. The Corporation has not filed any confidential material change report with any securities regulatory authority or regulator or the TSX that at the date hereof remains confidential;

(n) the authorized capital of the Corporation consists of an unlimited number of Common Shares of which 284,171,860 Common Shares are issued and outstanding as fully paid and non-assessable and no person has any right, agreement or option, present or future, contingent or absolute, or any right capable of becoming such a right, agreement or option, for the issue or allotment of any unissued shares in the capital of the Corporation or any other security convertible into or exchangeable for any such shares other than outstanding warrants for the purchase of 78,850,860 Common Shares and incentive stock options entitling holders to purchase 25,700,000 Common Shares;

(o) the Common Shares are listed and traded on the Toronto Stock Exchange and the Common Shares are not registered under the U.S. Securities Act. The Corporation is a "reporting issuer" within the meaning of applicable securities laws and is not in default of any of the requirements of applicable securities laws or any of the administrative policies or notices of any regulatory or governmental authority and the Corporation is not included on a list of defaulting reporting issuers maintained by any of the applicable securities commissions or similar regulatory authorities in Canada;

(p) the information set forth under the Corporation's profile on SEDAR relating to the estimates by the Corporation of the mineral resources and reserves has been reviewed and verified by the Corporation or independent consultants to the Corporation as disclosed on SEDAR and the

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mineral resource and reserve information has been prepared in accordance with Canadian industry standards set forth in National Instrument 43-101 - Standards of Disclosure for Mineral Projects of the Canadian Securities Administrators, and the method of estimating the mineral resources and reserves has been verified by mining experience and the information upon which the estimates of resources and reserves were based, was, at the time of delivery thereof, complete and accurate in all material respects and there have been no material changes (as such term is defined under applicable securities laws) to such information since the date of delivery or preparation thereof except as disclosed prior to the date hereof by the Corporation under its profile on SEDAR;

(q) neither the Corporation nor, to the Corporation's knowledge, any employee or agent of the Corporation, has made any unlawful contribution or other payment to any official of, or candidate for, any federal, provincial, territorial or foreign office, or failed to disclose fully any contribution, in violation of any law, or made any payment to any foreign or Canadian or state governmental officer or official, or other person charged with similar public or quasi-public duties, other than payments required or permitted by applicable law;

(r) the Corporation acknowledges and agrees that the Subscriber would not purchase the Common Shares or incur any of the obligations incurred by it under this Subscription Agreement without the Corporation executing and delivering the LOI, the Joint Venture Agreement and the Investor Rights Agreement and performing its obligations hereunder and thereunder and that the Corporation shall comply with all its obligations hereunder and thereunder; and

(s) upon issuance, the Common Shares shall be validly issued as fully paid and non-assessable shares of the Corporation.

7. Issuance of Common Shares. Following receipt by the Corporation from the Subscriber of the Aggregate Subscription Price, the Corporation will:

(a) issue to the Subscriber the number of Common Shares which the Subscriber purchased;

(b) deliver to the Subscriber certificates representing the Common Shares which the Subscriber purchased; and

(c) file such forms and documents as may be required to be filed under applicable securities laws relating to the offering and issuance of the Common Shares.

8. Rejection of Subscription. The Subscriber acknowledges and agrees that the acceptance of this Subscription Agreement will be conditional upon the Subscriber complying with its covenants and obligations under this Subscription Agreement and the sale of the Common Shares to the Subscriber being exempt hum any prospectus, dealer registration and offering memorandum requirements of applicable securities laws.

The Corporation acknowledges that the Subscriber may terminate its obligations hereunder if the conditions precedent in Section 11 are not satisfied by the Closing Date or if prior to the Closing Date a person makes a Take-Over Bid or if the Closing Date does not occur by the Outside Date (provided that the Subscriber is not in breach of its representations, warranties or covenants in this Subscription Agreement).

The Subscriber acknowledges that the Corporation may terminate its obligations hereunder if the conditions precedent in Section 12 are not satisfied or the Subscriber is in breach of its representations, warranties or covenants under this Agreement or if the Closing Date does not occur by the Outside Date (provided that the Corporation is not in breach of its representations, warranties or covenants in this Subscription Agreement).

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If this Subscription Agreement is terminated as provided herein, any certified cheque(s), bank drafl(s) or other funds delivered by the Subscriber on account of the Aggregate Subscription Amount for the Common Shares subscribed for, or a replacement cheque therefor, will be promptly returned to the Subscriber without interest or deduction.

9. Time and Place of Closing. The sale of the 70,600,000 Common Shares by the Corporation to the Subscriber will be completed (the "Closing") at the offices of the Corporation's legal counsel in Toronto, Ontario at 10:00 a.m. (Toronto time) or such other place or time as the Corporation and Subscriber may agree (the "Closing Time") on November 13, 2014 or such date as the Subscriber and the Corporation may agree in writing (the "Closing Date"), such date to occur not later than the Outside Date.

10. Deliveries at Closing. At or prior to the Closing Time, the Subscriber shall deliver to the Corporation, the Aggregate Subscription Price by wire transfer or bank draft in freely negotiable Canadian funds. At or promptly following the Closing Time, the Corporation shall deliver to the Subscriber certificates representing the Common Shares and such other documentation as may be required under this Subscription Agreement.

11. Conditions Precedent In favour of the Subscriber. The Corporation acknowledges and agrees that the obligations of the Subscriber hereunder are conditional on the below:

(a) the representations and warranties of the Corporation contained in (A) this Subscription Ag-eement being true and correct as of the date of this Subscription Ageement and as of the Closing Date, (B) the Joint Venture Ageement and the Investor Rights Agreement being true and correct as of the Closing Date, and the Subscriber shall have received an officer's certificate of the Corporation, addressed to the Subscriber and dated the Closing Date, signed by two of its senior executive officers (without personal liability), confirming the same as at the Closing Date;

(b) the performance by the Corporation of all covenants and obligations required to be performed by it at or prior to the Closing Time;

(c) the Corporation having signed and delivered this Subscription Ageement and the Joint Venture Agreement and Investor Rights Ageement and the Corporation not being in breach of any such ageements or the LOI;

(d) no person shall have commenced or publicly armoimced its intention to commence a take-over bid, tender offer or exchange offer that, if consummated, would result in such person beneficially owning, directly or indirectly, 20% or more (as calculated and determined pursuant to Section 90 of the Securities Act (Ontario)) of any class of Voting Securities (and/or securities convertible into, or exchangeable or exercisable for Voting Securities) of the Corporation or any of its subsidiaries as a result of which such person will acquire Confrol of the Coiporation or any of its subsidiaries (a "Take-Over Bid");

(e) the Corporation issuing and delivering to the Subscriber at Closing the certificate(s) representing the Common Shares subscribed for by the Subscriber hereunder, against payment of the Aggngate Subscription Price, in the names and denominations reasonably requested by the Subscriber;

(f) prior to the Closing Date the Corporation having obtained the Required Consent of the Exchange, in form and substance satisfactory to the Subscriber;

(g) the Subscriber receiving on the Closing Date the following opinions addressed to the Subscriber in form and substance satisfactory to the Subscriber and its counsel acting reasonably:

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(i) a title opinion fi-om Pitblado LLP., in form and substance satisfactory to the Subscriber, with respect to the ownership by the Corporation of the Property (as such term is defined in the Joint Venture Agreement); and

(ii) a legal opinion from Dickinson Wright LLP, subject to standard and customary qualifications, assumptions and reliances, including as to certain matters of fact, an officer's certificate, that:

(A) the Corporation is a corporation existing under the laws of the Province of Ontario and has not been dissolved;

(B) the Corporation has the corporate power and capacity to own its properties (including, without limitation, the Property) and assets, to carry on its business as it is currently being conducted and to execute and deliver this Subscription Agreement, the Joint Venture Agreement and the Investor Rights Agreement and to perform its obligations hereunder and thereunder;

(C) the execution and delivery of this Subscription Agreement, the Joint Venture Agreement and the Investor Rights Agreement and the perfoiTnance of the transactions contemplated hereby and thereby do not and will not result in a breach of, and do not create a state of facts which, after notice or lapse of time or both, will result in a breach of and do not and will not conflict with, any of the terms, conditions or provisions of the articles of the Corporation, the Johnson & Johnson Option or the Last Hope Option, or conflict with or result in any breach of any applicable laws of general application of the Province of Ontario or of Canada applicable therein or conflict with or result in any breach or violation of any order of any stock exchange or securities regulatory authority in Ontario to which the Corporation is subject;

(D) as to the authorized and issued share capital of the Corporation;

(E) all necessary corporate action having been taken by the Corporation to authorize the execution and delivery by it of this Subscription Agi'eement, the Joint Venture Agreement and the Investor Rights Agreement and that this Subscription Agreement, the Joint Venture Agreement and the Investor Rights Agreement have been duly and validly authorized, executed and delivered by the Corporation and constitute a legal, valid and binding obligation of the Corporation enforceable against the Corporation in accordance with its terms, subject to bankruptcy, insolvency or other laws affecting creditors' rights generally, general equitable principles and the qualification that rights to indemnity, contribution and waiver of contribution contained therein may be limited by applicable law and other customary qualifications;

(F) the Common Shares issuable hereunder having been validly issued as fully paid and non-assessable Common Shares of the Corporation;

(G) the issuance and sale of the Common Shares as contemplated hereunder being exempt from the prospectus requirements of applicable Ontario securities laws;

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(H) there is no consent, approval, authorization, filing, registration, order or qualification of or with any securities regulatory authority having jurisdiction over the Corporation which, under the laws of the Province of Ontario or the laws of Canada applicable therein or the rules of the Exchange is required for the execution, delivery and performance by the Corporation of this Subscription Agreement, the Joint Venture Agreement and the Investor Rights Agreement, except such as have been obtained or are to be filed following the Closing within the prescribed time;

(I) the Common Shares issuable hereunder have been conditionally approved for listing on the TSX on the expiry of all required hold periods under Ontario securities laws, subject to the filing of the required documents and payment of the required fees within the time period stipulated by the Exchange; and

(J) such other legal matters reasonably requested by the Subscriber and/or its counsel.

(h) Neither the execution, delivery and performance by the Corporation of its obligations under this Subscription Agreement, the Joint Venture Agreement and the Investor Rights Agreement will require the Corporation to obtain the approval of its shareholders.

12. Conditions Precedent in favour of the Corporation. The Subscriber acknowledges and agrees that the obligations of the Corporation hereunder are conditional on the below:

(a) the representations and warranties of the Subscriber contained in (A) this Subscription Agreement being true and correct as of the date of this Subscription Agreement and as of the Closing Date, (B) the Joint Venture Agreement and the Investor Rights Agreement being true and correct as of the Closing Date, and the Corporation shall have received an officer's certificate of the Subscriber, addressed to the Corporation and dated the Closing Date, signed by two of its senior executive officers (without personal liability), confirming the same as at the Closing Date;

(b) the performance by the Subscriber of all covenants and obligations required to be perfonned by it at or prior to the Closing Time;

(c) the Subscriber having signed and delivered this Subscription Agreement and the Joint Venture Agreement and Investor Rights Agreement and the Subscriber not being in breach of any such agreements;

(d) receipt by the Corporation of the Required Consent of the Toronto Stock Exchange; and

(e) delivery of a legal opinion from Fasken Martineau DuMoulin LLP, subject to standard and customary qualifications, assmnptions and reliances, including as to certain matters of fact, an officer's certificate, that:

(A) the Subscriber is a corporation existing under the laws of the Province of Ontario and has not been dissolved;

(B) the Subscriber has the corporate power and capacity to own its properties and assets, to carry on its business as it is currently being

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conducted and to execute and deliver this Subscription Agi-eement, the Joint Venture Agreement and the Investor Rights Agreement and to perform its obligations hereunder and thereunder;

(C) the execution and delivery of this Subscription Agreement, the Joint Venture Agreement and the Investor Rights Agreement and the performance of the transactions contemplated hereby and thereby do not and will not result in a breach of, and do not create a state of facts which, after notice or lapse of time or both, will result in a breach of and do not and will not conflict with, any of the terms, conditions or provisions of the articles of the Subscriber, or conflict with or result in any breach of any applicable laws of general application of the Province of Ontario or of Canada applicable therein or conflict with or result in any breach or violation of any order of any stock exchange or securities regulatory authority in Ontario to which the Subscriber is subject;

(D) all necessary corporate action having been taken by the Subscriber to authorize the execution and delivery by it of this Subscription Agreement, the Joint Venture Agreement and the Investor Rights Agreement and that this Subscription Agreement, the Joint Venture Agreement and the Investor Rights Agreement have been duly and validly authorized, executed and delivered by the Subscriber and constitute a legal, valid and binding obligation of the Subscriber enforceable against the Subscriber in accordance with its terms, subject to bankruptcy, insolvency or other laws affecting creditors' rights generally, general equitable principles and the qualification that rights to indemnity, contribution and waiver of contribution contained therein may be limited by applicable law and other customary qualifications;

(E) there is no consent, approval, authorization, filing, registration, order or qualification of or with any securities regulatory authority having jurisdiction over the Subscriber which, under the laws of the Province of Ontario or the laws of Canada applicable therein or the rules of the Toronto Stock Exchange is required for the execution, delivery and performance by the Subscriber of this Subscription Agreement, the Joint Venture Agreement and the Investor Rights Agreement; and

(F) such other legal matters reasonably requested by the Corporation and/or its counsel.

13. No Partnership. Nothing herein shall constitute or be construed to constitute a partnership of any kind whatsoever between the Subscriber and the Corporation.

14. Governing Law. The contract arising out of the execution and delivery of this Subscription Agreement by the Subscriber and the execution thereof by the Corporation shall be governed by and construed in accordance with the laws of the Province of Ontario and the federal laws of Canada applicable therein. The parties irrevocably attorn to the non-exclusive jurisdiction of the courts of the Province of Ontario.

15. Time of Essence. Time shall be of the essence of this Subscription Agreement.

16. Entire Agreement. This Subscription Agreement, the Joint Venture Agreement and the Investor Rights Agreement represents the entire agreement of the parties hereto relating to the subject matter hereof, and there are no representations, covenants or other agreements relating to the subject matter hereof except as

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stated or referred to herein or therein. For certainty, the binding provisions of the LOI respecting exclusivity and confidentiality shall terminate on the Closing Date, and if the Closing Date does not occur before the Outside Date, on the Outside Date.

17. Facsimile and Electronic Copies. The Corporation shall be entitled to rely on delivery of a facsimile or electronic copy of executed subscriptions, and acceptance by the Corporation of such facsimile or electronic subscriptions shall be legally effective to create a valid and binding agreement between the Subscriber and the Corporation in accordance with the terms hereof. In addition, this Subscription Agreement may be executed in counterparts, each of which shall be deemed to be an original and all of which shall constitute one and the same document.

18. Severability. The invalidity, illegality or tmenforceability of any provision of this Subscription Agreement shall not affect the validity, legality or enforceability of any other provision hereof or of the remainder of this Subscription Agreement.

19. Survival. The covenants, representations and warranties contained in this Subscription Agreement shall survive the closing of the transactions contemplated hereby, and shall be binding upon and enure to the benefit of the parties hereto and their respective heirs, executors, administrators, successors and permitted assigns.

20. Interpretation. The headings used in this Subscription Agreement have been inserted for convenience of reference only and shall not affect the meaning or interpretation of this Subscription Agreement or any provision hereof. In this Subscription Agreement, all references to money amounts are to Canadian dollars.

21. Amendment. Except as otherwise provided herein, this Subscription Agreement may only be amended by the parties hereto in writing.

22. Assignment. Neither party may assign all or part of its interest in or to this Subscription Agreement without the consent of the other party in writing.

23. Language. The Subscriber acknowledges that it has consented to and hereby requests that all documents evidencing or relating in any way to the sale of the Common Shares be drawn up in the English language only.

PRIVACY NOTICE

This Subscription Agreement and the Schedules hereto require the Subscriber to provide certain personal information (respecting the Subscriber and, if applicable, the beneficial pui^chaser for whom the Subscriber is contracting) to the Corporation. Such information is being collected by the Corporation for the purposes of completing the Offering, which includes, without limitation, determining the eligibility of the Subscriber or, if applicable, the beneficial purchaser for whom the Subscriber is contracting, to purchase the Common Shares under applicable securities laws, preparing and registering certificates representing the Common Shares to be issued hereunder and completing filings required under applicable securities legislation, regulations, rules, policies or orders of any stock exchange or securities regulatory authority.

In addition, such personal information may be used or disclosed by the Corporation for the purpose of administering the Corporation's relationship with the Subscriber or, if applicable, the beneficial purchaser for whom the Subscriber is contracting. For example, such personal information may be used by the Corporation to communicate with the Subscriber or, if applicable, the beneficial purchaser for whom the Subscriber is contracting (such as by providing annual or quarterly reports, sending notices of shareholder meetings etc.), to prepare tax filings and forms or to comply with its obligations under taxation, securities and other laws (such as maintaining a list of holders of Common Shares).

In connection with the foregoing, the personal information of the Subscriber or, if applicable, the beneficial

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purchaser for whom the Subscriber is contracting, may be disclosed by the Corporation to: (i) any stock exchanges or securities regulatory or taxation authorities, (ii) the Corporation's registrar and transfer agent, and (iii) any of the other parties involved in the Offering, including legal counsel, and may be included in record books prepared in respect of the Offering.

By executing this Subscription Agreement, the Subscriber (on its own behalf and, if applicable, on behalf of the beneficial purchaser for whom it is contracting) hereby consents to the collection, use and disclosure of such personal information. The Subscriber (on its own behalf and, if applicable, on behalf of the beneficial purchaser for whom it is contracting) also consents to the filing of copies or originals of any of the documents provided to the Corporation by or on behalf of the Subscriber with any taxation or securities regulatory authority in relation to the transactions contemplated by this Subscription Agreement.

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SCHEDULE"A"

PARTICULARS OF THE SUBSCRIBER

Present Ownership of Shares

The Subscriber either [CHECK APPROPRIATE ITEM):

owns directly or indirectly, or exercises control or direction over Common Shares in the capital stock of the Corporation or securities convertible into Common Shares in the capital stock of the Corporation (excluding the securities subscribed for herein); or

X does not own, directly or indirectly, or exercise control or direction over anv Common Shares in the capital stock of the Corporation or convertible sectirities entitling the Subscriber to acquire any Common Shares in the capital stock of the Corporation (excluding the securities subscribed for herein).

Insider Status

The Subscriber either [CHECK APPROPRIATE ITEM[:

is an "Insider" of the Corporation as defined in the Securities Act (Ontario). More specifically, "insider" means:

(a) every director or senior officer of the Corporation;

(b) every director or senior officer of a person that is itself an insider or subsidiary of the Corporation;

(c) every subsidiary of the Corporation;

(d) any person or company that:

(i) beneficially owns, directly or indirectly, voting securities of the Corporation;

(ii) exercises control or direction over voting securities of the Corporation;

(iii) beneficially owns, directly or indirectly certain voting securities of the Corporation and exercises control or direction over certain other voting securities of the Corporation,

carrying more than 10% of the voting rights attached to all the Corporation's outstanding voting securities; or

(e) the Corporation itself, if it has purchased, redeemed or otherwise acquired any securities of its own issue, for so long as it continues to hold those securities.

X is not an Insider of the Corporation

Schedule A-1 DM TOR/234927.00050/7474078.4