Common use of Acknowledgements of the Subscriber Clause in Contracts

Acknowledgements of the Subscriber. Subscriber acknowledges and agrees that: (a) It has not received an offering memorandum or similar document and that its decision to enter into this subscription agreement and to purchase the Purchased Units has not been made upon any verbal or written representation as to fact or otherwise made by the Corporation or any other person associated therewith and that its decision is based entirely upon publicly available information concerning the Corporation and the representations of the Corporation contained herein, including the documents delivered in connection herewith. (b) The distribution of the Purchased Units is being made on a private placement basis and has not been qualified pursuant to the securities laws of any province or territory of Canada, and any transaction involving the Purchased Units in any province or territory of Canada may constitute a violation of applicable Canadian provincial securities legislation unless carried out pursuant to an applicable exemption therefrom. (c) It has been independently advised or is otherwise aware that any resale of the Purchased Securities is subject to certain resale restrictions provided for in certain securities legislation of the provinces and territories of Canada. The Purchased Securities are subject to statutory "hold periods" during which they may not be resold, except pursuant to a further statutory exemption from the applicable prospectus and distribution requirements under securities legislation, or unless an appropriate discretionary order is obtained pursuant to applicable security laws. It has been advised and afforded the full opportunity to consult with its own legal and other professional advisors in connection with any applicable re-sale restrictions. (d) It has been independently advised that the Purchased Units are being offered for sale only on a "private placement" basis and that the sale and delivery of the Purchased Securities underlying the Purchased Units to the Subscriber is conditional upon such sale being exempt from the requirement to file a prospectus under any applicable law governing the sale of such securities or upon the issuance of such orders, consents or approvals as may be required to permit such sale without the requirement of filing a prospectus. (e) It has further been independently advised as to applicable resale restrictions in the jurisdiction in which it resides, confirms that no representation has been made to it by or on behalf of the Corporation with respect thereto, acknowledges that it is aware of the characteristics of the Purchased Securities underlying the Purchased Units, the risks relating to an investment therein and of the fact that it may not be able to resell the Purchased Securities underlying the Purchased Units except in accordance with exemptions under applicable securities legislation and regulatory policy. (f) The Subscriber acknowledges that the Purchased Units are subject to the terms, conditions and provisions of this subscription agreement. (g) A prospectus will not be filed by the Corporation to qualify the Purchased Securities or any of them. (h) The Purchased Securities shall be subject to a forty-one (41) day hold period in the U.S., pursuant to "Category 2" of Regulation S under the U.S. Securities Act of 1933, as amended, which period shall commence from the date of issuance, and the certificates representing the same shall be engrossed with the following legend, which shall be the only legend engrossed on such certificates relating to resale in the U.S.: "The securities represented by this certificate may not be sold, transferred, hypothecated or otherwise traded until July *, 2002, pursuant to "Category 2" of Regulation S under the U.S. Securities Act of 1933, as amended."

Acknowledgements of the Subscriber. The Subscriber acknowledges and agrees (on its own behalf and, if applicable, on behalf of each person on whose behalf the Subscriber is contracting) that: (a) It has not received an offering memorandum or similar document and that its decision to enter into this subscription agreement is subject to rejection or acceptance by the Corporation in whole or in part, and is effective only upon acceptance by the Corporation; (b) the Preferred Shares subscribed for by the Subscriber hereunder form part of a larger issue and sale by the Corporation of a maximum of 10,000,000 Preferred Shares (including Series F Preferred Shares of the Corporation) (the “Offering”) at a subscription price per Preferred Share equal to the net asset value per Preferred Share determined for each Preferred Share offered and issued under the Offering as at the relevant Closing Date; (c) no fees or commissions shall be payable to eligible persons seeking Subscribers for any of the Preferred Shares other than eligible persons seeking Subscribers for Series C Preferred Shares would be entitled to an annual trailing fee of 0.50% of every Series C Preferred Share that continues to be held by Subscribers introduced by such eligible persons and 0.50% of all additional Series C Preferred Shares acquired by such Subscribers under the Corporation’s DRIP. The trailing fee shall be payable monthly. No trailing fee shall be payable in connection with Series F Preferred Shares. In addition, eligible persons seeking Subscribers for any of the Preferred Shares may charge their clients additional fees or commissions to purchase or sell such Preferred Shares; (d) the Purchased Units has not been made upon Subscriber acknowledges and agrees that it shall be entitled to, among other things, at its option, certain retraction rights, as provided under the Corporation’s Articles and as further set forth in Section 5.1 of the Offering Memorandum under the heading “Retraction at the Option of the Holder”, which rights shall be subject to the limits and the rights of the Corporation to deny, suspend or delay retractions as described therein, including the restriction on the retraction of any verbal Series C Preferred Share for a period of four (4) months from the date of the issuance of any such Preferred Share pursuant to this Subscription Agreement; (e) in accordance with the terms of the Offering Memorandum, the Redemption Price (as such term is defined in the Offering Memorandum) in respect of any Preferred Shares subscribed hereunder shall mean the net asset value per Preferred Share for purposes of any redemption or written representation as to fact retraction of the Preferred Shares or otherwise made by in connection with the liquidation, dissolution or winding up of the Corporation or any other person associated therewith and that its decision is based entirely upon publicly available information concerning distribution of the Corporation and the representations assets of the Corporation contained hereinamong its shareholders for the purpose of winding up its affairs, including the documents delivered in connection herewith. (b) The distribution of the Purchased Units is being made on a private placement basis and has not been qualified pursuant to the securities laws of any province or territory of Canada, and any transaction involving the Purchased Units in any province or territory of Canada may constitute a violation of applicable Canadian provincial securities legislation unless carried out pursuant to an applicable exemption therefrom. (c) It has been independently advised or is otherwise aware that any resale of the Purchased Securities is subject to certain resale restrictions provided for in certain securities legislation of the provinces and territories of Canada. The Purchased Securities are subject to statutory "hold periods" during which they may not be resold, except pursuant to a further statutory exemption from as determined as at the applicable prospectus and distribution requirements under securities legislationredemption, retraction or unless an appropriate discretionary order is obtained pursuant to applicable security laws. It has been advised and afforded the full opportunity to consult with its own legal and other professional advisors in connection with any applicable re-sale restrictions. (d) It has been independently advised that the Purchased Units are being offered for sale only on a "private placement" basis and that the sale and delivery of the Purchased Securities underlying the Purchased Units to the Subscriber is conditional upon such sale being exempt from the requirement to file a prospectus under any applicable law governing the sale of such securities or upon the issuance of such orders, consents or approvals as may be required to permit such sale without the requirement of filing a prospectus. (e) It has further been independently advised as to applicable resale restrictions in the jurisdiction in which it resides, confirms that no representation has been made to it by or on behalf of the Corporation with respect thereto, acknowledges that it is aware of the characteristics of the Purchased Securities underlying the Purchased Units, the risks relating to an investment therein and of the fact that it may not be able to resell the Purchased Securities underlying the Purchased Units except in accordance with exemptions under applicable securities legislation and regulatory policy.liquidation date; (f) The the Subscriber acknowledges that is responsible for obtaining such legal advice as it considers appropriate in connection with the Purchased Units are subject to the termsexecution, conditions delivery and provisions performance by it of this subscription agreement.Subscription Agreement; and (g) A prospectus will not be filed by the Corporation to qualify the Purchased Securities or any of them. (h) The Purchased Securities shall be subject to a forty-one (41) day hold period investment in the U.S., pursuant to "Category 2" of Regulation S under the U.S. Securities Act of 1933Preferred Shares is a risky investment and, as amendeda result, which period shall commence from the date of issuance, and the certificates representing the same shall be engrossed with the following legend, which shall be the only legend engrossed on such certificates relating to resale in the U.S.: "The securities represented by this certificate Subscriber may not be sold, transferred, hypothecated or otherwise traded until July *, 2002, pursuant to "Category 2" of Regulation S under the U.S. Securities Act of 1933, as amendedlose its entire investment."

Acknowledgements of the Subscriber. The Subscriber acknowledges and agrees thatas follows: (a) It has not received an offering memorandum or similar document and that its decision to enter into this subscription agreement and to purchase If the Purchased Units has not been made upon any verbal or written representation Subscriber is acting as to fact or otherwise made by the Corporation or any other person associated therewith and that its decision is based entirely upon publicly available information concerning the Corporation agent for a principal, and the representations Subscriber is not a trust corporation or trust company described in paragraph (p), or a registered adviser described in paragraph (q), of the Corporation contained hereindefinition of “accredited investor” in section 1.1 of NI 45-106 that is purchasing the Units on behalf of an account fully managed by it, including then unless the documents delivered context requires otherwise, any acknowledgement, representation, warranty, or covenant of the Subscriber in connection herewiththis Subscription Agreement will be deemed to also be an acknowledgement, representation, warranty, or covenant of the principal. (b) The distribution Subscriber acknowledges that the Fund will pay an annual servicing fee equal to 1.00% per annum of the Purchased net asset value of the Units sold by a registered dealer in respect of the Units, payable quarterly in arrears. The amount of this fee will be deducted from distributions to holders of the Units. The Subscriber further acknowledges that the Manager is being made on a private placement basis and has not been qualified pursuant entitled to the securities laws of any province or territory of Canada, and any transaction involving the Purchased Units in any province or territory of Canada may constitute a violation of applicable Canadian provincial securities legislation unless carried out pursuant to an applicable exemption therefromcertain fees. (c) It This is an offering made on a private basis without a prospectus and no federal, state, provincial or other agency has made any finding or determination as to the merits of the investment nor made any recommendation or endorsement of the Units and that: (i) no prospectus or registration statement has been independently advised or is otherwise aware that filed with any resale of the Purchased Securities is subject to certain resale restrictions provided for in certain securities legislation of the provinces and territories of Canada. The Purchased Securities are subject to statutory "hold periods" during which they may not be resold, except pursuant to a further statutory exemption from the applicable prospectus and distribution requirements under securities legislation, or unless an appropriate discretionary order is obtained pursuant to applicable security laws. It has been advised and afforded the full opportunity to consult with its own legal and other professional advisors Regulators in connection with any this offering; (ii) no securities commission, agency, governmental authority, regulatory body, stock exchange or other regulatory body has reviewed or passed on the merits of an investment in or endorsement of the Units; (iii) the Subscriber may not receive information that would otherwise be required to be provided to the Subscriber under such securities legislation; and (iv) in addition to releases contained in this Subscription Agreement, the Fund is relieved from certain obligations that would otherwise apply under applicable re-sale restrictionssecurities legislation. (d) It has been independently advised The Fund is required to take measures to verify that the Purchased Units are being offered for sale only on a "private placement" basis and that the sale and delivery of the Purchased Securities underlying the Purchased Units to the Subscriber is conditional upon such sale being exempt eligible to purchase the Units pursuant to exemptions from Securities Law and the requirement to file a prospectus under any applicable law governing the sale of such securities or upon the issuance of such orders, consents or approvals as Subscriber may be required to permit provide to the Fund additional information to confirm the Subscriber’s status, including information that independently confirms the Subscriber’s status as an accredited investor, such sale without as provision of financial statements and tax returns or other evidence of eligibility, or the requirement Subscriber’s relationship with a director, officer, founder or control person of filing a prospectusthe Fund. (e) It A subscription of Units must be considered a high risk speculation and that no director, officer, founder, member, agent or employee of the Fund has further been independently advised as made any representations with regard to applicable resale restrictions the future value of the Units or any assets to be acquired or work to be done pursuant to his/her/its participation in the jurisdiction in which it resides, confirms that no representation has been made to it by or on behalf of the Corporation with respect thereto, acknowledges that it is aware of the characteristics of the Purchased Securities underlying the Purchased Units, the risks relating to an investment therein and of the fact that it may not be able to resell the Purchased Securities underlying the Purchased Units except in accordance with exemptions under applicable securities legislation and regulatory policyFund. (f) The Subscriber acknowledges that Fund may complete additional financings in the Purchased Units are subject to future, and such future financings may have a dilutive effect on current security holders of the termsFund, conditions and provisions of this subscription agreementincluding the Subscriber. (g) A prospectus The Units have not been and will not be filed by registered under the Corporation to qualify the Purchased U.S. Securities Act, or any state securities laws, and the Units may not be offered or sold in the United States or to a U.S. person except in compliance with the requirements of theman exemption from registration under the U.S. Securities Act and any applicable state securities laws. (h) The Purchased Subscriber’s ability to transfer the Units is limited by, among other things, the Securities shall Laws. The Units will be subject to statutory resale restrictions under the Securities Laws and under other applicable securities laws, and the Subscriber covenants that it will not resell the Units except in compliance with such laws and the Subscriber acknowledges that it is solely responsible (and the Fund is not in any way responsible) for such compliance. (i) The Subscriber is aware that the Units are being offered on a forty-one “private placement” basis. (41j) day hold period The Subscriber is aware that no market for the Units currently exists in the U.S.United States, pursuant to "Category 2" that the Units are being offered in a transaction not involving a public offering within the United States within the meaning of Regulation S the U.S. Securities Act, that the Securities have not been and will not be registered under the U.S. Securities Act or the securities laws of 1933, as amended, which period shall commence from the date of issuanceany state, and that the certificates representing the same shall be engrossed with the following legend, which shall be the only legend engrossed on such certificates relating to resale in the U.S.: "The securities represented by this certificate Units may not be offered or sold, transferreddirectly or indirectly, hypothecated or otherwise traded until July *, 2002, pursuant to "Category 2" of Regulation S in the United States without registration under the U.S. Securities Act or compliance with the requirements of an exemption from registration and it acknowledges that the Fund has no present intention of filing a registration statement under the U.S. Securities Act in respect of any of its securities. (k) The Subscriber undertakes and agrees that it will not offer or sell any of the Units 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 requirement is available to the Subscriber and the Subscriber has furnished an opinion of counsel of recognized standing in form and substance satisfactory to the Fund and/or the Manager to that effect. (l) If the Subscriber is a U.S. Person, or purchasing the Units for the account or benefit of a U.S. Person, or a person in the United States, then the Subscriber also acknowledges and understands that upon issuance thereof, and until such time as the same is no longer required under the applicable requirements of the U.S. Securities Act or applicable state securities laws or regulations, the certificates representing the Units or in substitution thereof will also be required to be stamped with the following legend (or substantially equivalent language) restricting transfer in the following manner in the United States: “THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, as amendedAS AMENDED (THE “U.S. SECURITIES ACT”). THE HOLDER HEREOF, BY PURCHASING SUCH SECURITIES AGREES FOR THE BENEFIT OF THE FUND THAT SUCH SECURITIES MAY BE OFFERED, SOLD PLEDGED OR OTHERWISE TRANSFERRED ONLY (A) TO THE FUND, (B) OUTSIDE THE UNITED STATES IN ACCORDANCE WITH RULE 904 OF REGULATION S UNDER THE U.S. SECURITIES ACT, IF APPLICABLE, (C) PURSUANT TO THE EXEMPTION FROM THE REGISTRATION REQUIREMENTS UNDER THE U.S. SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER, IF AVAILABLE, AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS OR (D) IN A TRANSACTION THAT DOES NOT REQUIRE REGISTRATION UNDER THE U.S.SECURITEIS ACT OR ANY APPLICABLE STATE LAWS AND REGULATIONS GOVERNING THE OFFER AND SALE OF SECURITIES, AND IN THE CASE OF (C) OR (D), THE HOLDER HAS PRIOR TO SUCH SALE FURNISHED TO THE FUND AN OPINION OF COUNSEL OR OTHER EVIDENCE OF EXEMPTION IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE FUND”; (m) There is no government or other insurance covering the Units."

Acknowledgements of the Subscriber. Subscriber The Subscriber, on its own behalf and, if applicable, on behalf of any Disclosed Principal, agrees and acknowledges and agrees that: (a) It has not received an offering memorandum or similar document the Securities subscribed for by it hereunder form part of a larger issuance and that its decision to enter into this subscription agreement and to purchase the Purchased Units has not been made upon any verbal or written representation as to fact or otherwise made sale by the Corporation or any other person associated therewith and that its decision is based entirely upon publicly available information concerning the Corporation and the representations of the Corporation contained herein, including the documents delivered in connection herewith.securities; (b) The distribution of this subscription is subject to rejection or acceptance by the Purchased Units Corporation in whole or in part and is being made on a private placement basis and has not been qualified pursuant to effective only upon acceptance by the securities laws of any province or territory of Canada, and any transaction involving the Purchased Units in any province or territory of Canada may constitute a violation of applicable Canadian provincial securities legislation unless carried out pursuant to an applicable exemption therefrom.Corporation; (c) It has been independently advised or is otherwise aware that any resale the net proceeds of the Purchased Securities is subject Offering will be released to certain resale restrictions provided for in certain securities legislation of the provinces Corporation at the Closing Date and territories of Canada. The Purchased Securities are subject to statutory "hold periods" during which they may not be resoldeach Specified Closing Date, except pursuant to a further statutory exemption from the applicable prospectus and distribution requirements under securities legislation, or unless an appropriate discretionary order is obtained pursuant to applicable security laws. It has been advised and afforded the full opportunity to consult with its own legal and other professional advisors in connection with any applicable re-sale restrictions.as applicable; (d) It has been independently advised that the Purchased Units are being offered for sale only on a "private placement" basis and that the sale and delivery of the Purchased Securities underlying the Purchased Units to the Subscriber Offering is conditional upon such sale being exempt from the prospectus filing or registration requirements and the requirement to file a prospectus deliver an offering memorandum in connection with the distribution of the Commitment Shares, the Debentures and Warrants under any applicable law governing the sale of such securities laws or upon the issuance of such orders, consents or approvals as may be required to permit such sale without the requirement of filing a prospectus.; (e) It there are risks associated with the purchase of the Securities and the Subscriber is solely responsible for obtaining independent legal, tax and investment advice as it considers appropriate in connection with its subscription for the Securities and has further been independently had the opportunity to acquire an understanding of the meanings of all of the terms and definitions contained herein for the purposes of giving the acknowledgements, representations, warranties, undertakings and covenants contained in this Subscription Agreement and that the Corporation’s counsel is acting as counsel to the Corporation and not as counsel to the Subscriber; (f) no securities commission, stock exchange, governmental agency, regulatory body or similar authority has reviewed, made any finding or determination or passed on the merits of the Commitment Shares, the Debentures, the Warrants or the Common Shares issuable upon conversion or exercise thereof and that there is no government or other insurance covering the Commitment Shares, the Debentures, the Warrants or the Common Shares issuable upon conversion or exercise thereof; (g) the Corporation has advised the Subscriber that the Corporation is relying on an exemption from the requirements to provide the Subscriber with a prospectus and to sell securities through a Person or company registered to sell securities under the Securities Act (Alberta) and other applicable securities laws and, as a consequence of acquiring the Securities pursuant to this exemption: (i) the Subscriber (and, if applicable, any Disclosed Principal) may be restricted from using most of the civil remedies available under applicable resale restrictions securities law such as certain protections, rights and remedies provided by the Securities Act (Alberta) or other applicable securities law, including statutory rights of rescission or damages; (ii) the Corporation is not required to deliver to the Subscriber (and, if applicable, any Disclosed Principal) certain information that would otherwise be required to be provided to it under applicable securities law; (iii) the common law may not provide the Subscriber (and, if applicable, any Disclosed Principal) with an adequate remedy in the jurisdiction event that it suffers investment losses in which it residesconnection with the Commitment Shares, confirms the Debentures, the Warrants or the Common Shares issuable upon conversion or exercise thereof acquired pursuant to the Offering; and (iv) the Corporation is relieved from certain obligations that would otherwise apply under applicable securities law; (h) other than as specifically provided for in the Debentures, the Corporation has not made any representations (written or oral) to the Subscriber or, if applicable, any Disclosed Principal: (i) regarding the future price or value of the Commitment Shares, the Debentures, the Warrants or the Common Shares issuable upon conversion or exercise thereof; (ii) that any Person will resell or repurchase the Commitment Shares, the Debentures, the Warrants or the Common Shares issuable upon conversion or exercise thereof; or (iii) that any Person will refund the purchase price of the Commitment Shares, the Debentures, the Warrants or the Common Shares issuable upon conversion or exercise thereof other than as provided in this Subscription Agreement; (i) there are restrictions on the ability of the Subscriber to resell the Commitment Shares, the Debentures, the Warrants and the Common Shares issuable upon conversion or exercise thereof and the Subscriber may not be able to resell the Commitment Shares, the Debentures, the Warrants and the Common Shares issuable upon conversion or exercise thereof except in accordance with limited exemptions available under applicable securities law, regulatory policy and stock exchange rules, and that the Subscriber (and, if applicable, any Disclosed Principal) is solely responsible for (and the Corporation is in no way responsible for) determining such restrictions and for compliance with such resale restrictions; (j) the Commitment Shares, the Debentures, the Warrants and the Common Shares issuable upon conversion or exercise thereof are being offered and sold in reliance on Section 4(2) of the U.S. Securities Act and Rule 506 thereunder and the Commitment Shares, the Debentures, the Warrants and the Common Shares have not been registered under the U.S. Securities Act, or the securities laws of any state, and that the Commitment Shares, the Debentures, the Warrants and the Common Shares issuable upon conversion or exercise thereof may not be offered or sold, directly or indirectly, in transactions outside the United States without registration under the U.S. Securities Act or compliance with requirements of an exemption from registration, and that the Corporation has no present intention of filing a registration statement under the U.S. Securities Act in respect of the Commitment Shares, the Debentures or the Warrants, and that the Corporation has no obligation to file a registration statement under the U.S. Securities Act in respect of the Common Shares issuable upon conversion or exercise of the Debentures or the Warrants except as provided in the registration rights agreement in respect of the Common Shares referred to in Section 14(b) hereof. (k) the certificates representing the Commitment Shares, the Debentures, the Warrants and the Common Shares issuable upon conversion or exercise thereof will bear a legend indicating that the resale of such securities is restricted; (l) intentionally omitted; (m) subject to the terms and conditions of the Debentures, the Corporation may, in addition to the Offering, desire or be required to complete additional financings in the future to develop the business of the Corporation and to fund its ongoing development and there is no assurance that such additional financing will be available and, if available, on reasonable terms. If such future financings are not available, the Corporation may be unable to fund its ongoing development. Subject to the terms and conditions of the Debentures, any such future financings may have a dilutive effect on current shareholders, including the Subscriber (and, if applicable, any Disclosed Principal); (n) the Parent currently has equity securities listed on the TSX-V; (o) the Parent intends to consolidate the Common Shares and acknowledges notice of such consolidation as contemplated by the terms of the Warrants; and (p) there is no market for the the Debentures or Warrants and there is no assurance that a market will develop in the future and that no representation has been made to it by or on behalf of the Corporation with respect thereto, acknowledges that it is aware of the characteristics of the Purchased Securities underlying the Purchased Units, the risks relating to an investment therein and of the fact that it may not be able to resell the Purchased Securities underlying the Purchased Units except in accordance with exemptions under applicable securities legislation and regulatory policy. (f) The Subscriber acknowledges that the Purchased Units are subject to the terms, conditions and provisions of this subscription agreement. (g) A prospectus will not be filed by the Corporation to qualify the Purchased Securities or any of them. (h) The Purchased Securities shall be subject to a forty-one (41) day hold period in the U.S., pursuant to "Category 2" of Regulation S under the U.S. Securities Act of 1933, as amended, which period shall commence from the date of issuance, and the certificates representing the same shall be engrossed with the following legend, which shall be the only legend engrossed on such certificates relating to resale in the U.S.: "The securities represented by this certificate may not be sold, transferred, hypothecated or otherwise traded until July *, 2002, pursuant to "Category 2" of Regulation S under the U.S. Securities Act of 1933, as amended."

Acknowledgements of the Subscriber. The Subscriber (for greater certainty, on its own behalf and, if applicable, on behalf of others for whom it is acting hereunder) acknowledges and agrees thatas follows: (a) It the Subscriber has not received an offering memorandum or similar document received, reviewed and that its decision to enter into this subscription agreement and to purchase the Purchased Units has not been made upon any verbal or written representation as to fact or otherwise made by the Corporation or any other person associated therewith and that its decision is based entirely upon publicly available information concerning the Corporation and the representations read a copy of the Corporation contained herein, including the documents delivered Offering Memorandum in connection herewith.its entirety; (b) The distribution no securities commission, agency, governmental authority, regulatory body, stock exchange or other regulatory body has reviewed or passed on the merits of the Purchased Units is being made on a private placement basis and has not been qualified pursuant to or the securities laws of any province or territory of Canada, and any transaction involving the Purchased Units in any province or territory of Canada may constitute a violation of applicable Canadian provincial securities legislation unless carried out pursuant to an applicable exemption therefrom.Offering Memorandum;‌ (c) It has been independently advised or is otherwise aware that any resale of the Purchased Securities is subject to certain resale restrictions provided for in certain securities legislation of the provinces and territories of Canada. The Purchased Securities are Units shall be subject to statutory "hold periods" during resale restrictions under the Securities Laws of the jurisdiction in which they may the Subscriber resides and under other applicable securities laws, and the Subscriber covenants that it will not be resoldresell the Units except in compliance with such laws and the Subscriber acknowledges that it is solely responsible (and the Issuer is in no way responsible) for such compliance, except pursuant and it is the responsibility of the Subscriber to a further statutory exemption from the applicable prospectus find out what those restrictions are and distribution requirements under securities legislation, or unless an appropriate discretionary order is obtained pursuant to applicable security laws. It has been advised and afforded the full opportunity to consult comply with its own legal and other professional advisors in connection with any applicable re-sale restrictions.them before selling such Units; (d) It has been independently advised that the Purchased Subscriber’s ability to transfer the Units are being offered for sale only is limited by, among other things, applicable Securities Laws and the restrictions on a "private placement" basis transfer set out in the Declaration of Trust; (e) the terms and that the sale and delivery conditions of the Purchased Declaration of Trust (including, for greater certainty, the representations, warranties, agreements and covenants therein) shall be binding upon the Subscriber as a Unitholder and such terms and conditions shall enure to the benefit of and be binding upon the Subscriber;‌ (f) the Issuer and the Agent are relying on the representations, warranties, covenants, agreements and acknowledgments contained herein to determine the Subscriber’s eligibility to subscribe for the Units under applicable Securities underlying Laws and the Purchased Units Subscriber agrees to indemnify the Indemnified Parties against all losses, claims, costs, expenses, damages or liabilities that any of them may suffer or incur as a result of or arising from reliance thereon. The Subscriber undertakes to immediately notify the Issuer of any change in any statement or other information relating to the Subscriber set forth in the applicable Schedules attached hereto that takes place prior to the Closing Time; (g) the Issuer is conditional upon such sale being exempt relying on an exemption from the requirement to file provide the Subscriber with a prospectus under any applicable the Securities Laws and, as a consequence of acquiring the Units under the Offering pursuant to such exemption, the Subscriber has significantly fewer rights and remedies available to it than investors who acquire securities offered by a prospectus and certain protections, rights and remedies provided by the Securities Laws shall not be available to the Subscriber. The Subscriber is also aware that the common law governing the sale of such securities or upon the issuance of such orders, consents or approvals as may be required to permit such sale without the requirement of filing a prospectus. (e) It has further been independently advised as to applicable resale restrictions not provide investors with an adequate remedy in the jurisdiction event that they suffer investment losses in which it resides, confirms that no representation has been made to it by or on behalf of connection with Units acquired in the Corporation with respect thereto, acknowledges that it is aware of the characteristics of the Purchased Securities underlying the Purchased Units, the risks relating to an investment therein and of the fact that it may not be able to resell the Purchased Securities underlying the Purchased Units except in accordance with exemptions under applicable securities legislation and regulatory policy. (f) The Subscriber acknowledges that the Purchased Units are subject to the terms, conditions and provisions of this subscription agreement. (g) A prospectus will not be filed by the Corporation to qualify the Purchased Securities or any of them.Offering; (h) the Subscriber, and each beneficial purchaser for whom it is contracting hereunder, is responsible for obtaining such legal, financial and tax advice as it considers appropriate in connection with the execution, delivery and performance of this Subscription Agreement and the transactions contemplated under this Subscription Agreement. The Purchased Securities Subscriber, and each beneficial purchaser, is not relying on the Issuer, the Asset Manager, the Agent, or their respective affiliates or counsel in this regard; (i) there is no government or other insurance covering the Units;‌ (j) there are significant risks associated with the purchase of the Units and the Subscriber and any beneficial purchaser for whom it is acting may lose his, her, their or its entire investment; (k) the Issuer may complete additional financings in the future in order to develop the business of the Issuer and to fund its ongoing development; there is no assurance that such financings will be available and, if available, on reasonable terms; any such future financings may have a dilutive effect on current securityholders, including the Subscriber; and if such future financings are not available, the Issuer may be unable to fund its ongoing development;‌ (l) the Units are highly speculative in nature and there are significant risks associated with the purchase of the Units and the Subscriber has such knowledge, sophistication and experience in business and financial matters as to be capable of evaluating the merits and risks of its investment in the Units, fully understands the speculative nature of the Units and is able to bear the economic risk of loss of its entire investment. All costs and expenses incurred by the Subscriber (including any fees and disbursements of any special counsel or other advisors retained by the Subscriber) relating to the purchase of the Units shall be subject borne by the Subscriber; (m) pursuant to instructions from the Subscriber, the Issuer, the Agent or their appointees are authorized to correct any minor errors in or complete any minor information missing from the Schedules attached hereto;‌ (n) Issuer’s counsel is acting as counsel to the Issuer and not as counsel to the Subscriber; (o) Unitholders will not have any right or entitlement of any nature or kind whatsoever to provide services to or for the Issuer or any person related to the Issuer, or any right or entitlement of any nature or kind whatsoever to acquire goods or services from the Issuer or any person related to the Issuer or any right or entitlement of any nature or kind whatsoever to be provided services by the Issuer or any person related to the Issuer;‌ (p) the sole business of the Issuer is to invest in limited partnership units of the Partnership, which allows the Issuer and its subscribers to, through such investment, participate in a fortyreturn stream generated by the Partnership. The Issuer may also engage in other ancillary or incidental activities related to such purpose. The Issuer may not invest in the securities of any other issuer other than the Partnership; (q) the Issuer is not a reporting issuer in any jurisdiction in Canada and does not have any intention of becoming a reporting issuer or having any of its Units listed for trading on any recognized stock exchange; (r) in accordance with the Canada-one United States Enhanced Tax Information Exchange Agreement (41the “IGA”) day hold period and Part XVIII of the Income Tax Act (Canada) and related guidance issued in connection therewith (together, “FATCA”), the Issuer is required to report certain information with respect to Subscribers who are U.S. residents or U.S. citizens (including U.S. citizens who are residents or citizens of Canada), and certain other “U.S. Persons” as defined under the IGA, to the Canada Revenue Agency (“CRA”). The CRA may then exchange the information with the U.S. Internal Revenue Service (“IRS”) pursuant to the provisions of the IGA; (s) in accordance with Part XIX of the Income Tax Act (Canada), which implements the Organization for Economic Co-operation and Development Common Reporting Standard (“CRS”), the Issuer is required to report certain information with respect to Subscribers who are tax resident in jurisdictions other than Canada and the U.S., pursuant or who are controlled by one or more individuals who are tax resident in such jurisdictions. The CRA may then exchange the information with the tax authorities in the relevant participating foreign jurisdictions; (t) any information reported to "Category 2" the CRA by the Issuer or the Agent under FATCA or CRS in connection with the Subscriber’s investment in Units shall not be treated as a breach of Regulation S under any restriction upon the U.S. Securities Act disclosure of 1933information that may be imposed by Canadian law or otherwise; and (u) any information or documentation provided by such Subscriber and any disclosed principal with respect to FATCA or CRS, as amended, which period shall commence from to the date of issuance, Issuer and the certificates representing Agent may be disclosed to the same shall be engrossed with CRA, the following legend, which shall be the only legend engrossed on such certificates relating to resale in the U.S.: "The securities represented by this certificate may not be sold, transferred, hypothecated or otherwise traded until July *, 2002, pursuant to "Category 2" of Regulation S under the U.S. Securities Act of 1933, as amendedIRS and any other applicable governmental authority."

Acknowledgements of the Subscriber. The Subscriber acknowledges and agrees that: (a) It has not received an offering memorandum or similar document and there is no market for any Shares that its decision may be issued to enter into the Subscriber pursuant to acceptance of this subscription agreement (in whole or in part) and to purchase the Purchased Units has not been made upon any verbal or written representation as to fact or otherwise made by the Corporation or any other person associated therewith and that its decision is based entirely upon publicly available information concerning the Corporation and the representations of the Corporation contained herein, including the documents delivered in connection herewith.no market for such Shares may ever exist; (b) The distribution the Subscriber is acquiring the Subscription Shares pursuant to exemptions (the "Exemptions") from the registration and prospectus requirements of the Purchased Units is being made on a private placement basis and has not been qualified securities legislation (the "Legislation") in all jurisdictions relevant to this subscription, (c) in addition to any restrictions imposed pursuant to paragraph 6.1(b) above, any transfer, resale or other subsequent disposition of the securities laws Subscription Shares may be subject to restrictions contained in the Legislation applicable to the holder of any province the Subscription Shares or territory of Canadato the proposed transferee, including, but not limited to, resale restrictions under the Alberta Act, the Ontario Act and any transaction involving the Purchased Units PEI Act. The Corporation is not a reporting issuer in any province or territory of Canada and, accordingly, any applicable hold periods under the applicable Legislation may constitute a violation never expire. As such, the Subscription Shares may be subject to restrictions on resale for an indefinite period of applicable Canadian provincial securities legislation unless carried out pursuant time. In addition, the Corporation is not subject to an applicable exemption therefrom. (c) It has been independently advised or is otherwise aware that any resale the reporting requirements of the Purchased Securities is subject to certain resale restrictions provided for in certain securities legislation of the provinces and territories of Canada. The Purchased Securities are subject to statutory "hold periods" during which they may not be resold, except pursuant to a further statutory exemption from the applicable prospectus and distribution requirements under securities legislation, or unless an appropriate discretionary order is obtained pursuant to applicable security laws. It has been advised and afforded the full opportunity to consult with its own legal and other professional advisors in connection with any applicable re-sale restrictions1934 Act. (d) It the Subscriber has been independently advised by the Corporation that the Purchased Units are being offered for sale only on a "private placement" basis and Subscriber should consult his own legal adviser before disposing of all or any part of any Subscription Shares that the sale and delivery of the Purchased Securities underlying the Purchased Units may be issued to the Subscriber is conditional upon such sale being exempt from pursuant to this Subscription to avoid the requirement to file a prospectus under breach of any applicable law governing the sale of such securities or upon the issuance of such orders, consents or approvals as may be required to permit such sale without the requirement of filing a prospectus.Legislation; (e) It the Subscriber has further been independently advised given an adequate opportunity to ask questions of, and receive answers from, the officers of the Corporation concerning the purchase of the Subscription Shares and to obtain such additional information as the Subscriber deems necessary in order to evaluate an investment in the Corporation and the Corporation has provided all information requested by the Subscriber; (f) this offering has not been reviewed or approved by the United States Securities and Exchange Commission or any other government agency; (g) the certificate(s) representing the Subscription Shares will be endorsed with the following restrictive legend: “THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "ACT"), AND HAVE BEEN ISSUED IN RELIANCE UPON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE ACT PROVIDED BY REGULATION S PROMULGATED UNDER THE ACT. SUCH SECURITIES MAY NOT BE REOFFERED FOR SALE OR RESOLD OR OTHERWISE TRANSFERRED EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S, PURSUANT TO AN EFFECTIVE REGISTRATION UNDER THE ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM REGISTRATION UNDER THE ACT. HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE ACT” (h) the Subscriber will not engage in hedging transactions with regard to the Subscription Shares unless in compliance with the 1933 Act; (i) no person has made to the Subscriber any written or oral representations: (i) as to applicable resale restrictions in the jurisdiction in which it resides, confirms future price or value of the Subscription Shares; or (ii) that no representation the Subscription Shares will be listed and posted for trading on any stock exchange or that any application has been made to it by or list and post the Subscription Shares on behalf any stock exchange. (j) the business of the Corporation with respect thereto, acknowledges is in a development phase and that it there is aware no assurance that the Corporation will raise sufficient funds to adequately capitalise such business or that the business will be profitable in the future; (k) the Subscriber is not a U.S. Person and is not acquiring the Subscription Shares for the account or benefit of a U.S. Person; (l) none of the characteristics Subscription Shares may be offered or sold to a U.S. Person or for the account or benefit of a U.S. Person; (m) the Purchased Securities underlying the Purchased UnitsSubscriber has such knowledge and experience in finance, the risks relating securities, investments, including investments in non-listed and non-registered securities, and other business matters so as to an investment therein and of the fact that it may not be able to resell protect his interests in connection with the Purchased Securities underlying subscription; (n) the Purchased Units Subscriber will not transfer any of the Subscription Shares except in accordance with exemptions under the bylaws of the Corporation and any applicable securities legislation and regulatory policy.requirements of the Legislation; (fo) The Subscriber acknowledges that the Purchased Units are subject to Corporation is not a reporting issuer and the terms, conditions and provisions ability of this subscription agreement. (g) A prospectus will not be filed by the Corporation to qualify become a reporting issuer is dependent on factors beyond the Purchased Securities or any Corporation and its directors, which factors include the requirements of them.regulatory authorities having jurisdiction, the success of the Corporation’s business endeavours and the general state of the capital markets from time to time; and (hp) The Purchased Securities shall be subject to the Subscriber has been informed that the Corporation’s business is a fortystart-one (41) day hold period in the U.S., pursuant to "Category 2" up business which involves a high degree of Regulation S under the U.S. Securities Act of 1933, as amended, which period shall commence from the date of issuance, risk and the certificates representing purchase of the same shall Subscription Shares must be engrossed with considered a high risk speculation in which the following legend, which shall be the only legend engrossed on such certificates relating to resale in the U.S.: "The securities represented by this certificate Subscriber may not be sold, transferred, hypothecated or otherwise traded until July *, 2002, pursuant to "Category 2" of Regulation S under the U.S. Securities Act of 1933, as amendedlose his entire investment."

Acknowledgements of the Subscriber. The Subscriber acknowledges and agrees with the Corporation that: (a) It has not received an offering memorandum This subscription is subject to rejection or similar document and that its decision to enter into this subscription agreement and to purchase the Purchased Units has not been made upon any verbal or written representation as to fact or otherwise made allotment by the Corporation in whole or any other person associated therewith and that its decision is based entirely upon publicly available information concerning the Corporation and the representations of the Corporation contained herein, including the documents delivered in connection herewith.part; (b) The distribution of Corporation may complete additional financings in the Purchased Units is being made future which may have a dilutive effect on a private placement basis and has not been qualified pursuant existing stockholders at such time, including the Subscriber, subject to the securities laws of any province or territory of Canada, and any transaction involving additional purchase rights granted to the Purchased Units in any province or territory of Canada may constitute a violation of applicable Canadian provincial securities legislation unless carried out pursuant to an applicable exemption therefrom.Subscriber herein; (c) It No agency, governmental authority, regulatory body, stock exchange or other entity has been independently advised made any finding or is otherwise aware that determination as to the merit for investment of, nor has any resale of such agency, governmental authority, regulatory body, stock exchange or other entity made any recommendation or endorsement with respect to, the Purchased Securities is subject to certain resale restrictions provided for in certain securities legislation of the provinces and territories of Canada. The Purchased Securities are subject to statutory "hold periods" during which they may not be resold, except pursuant to a further statutory exemption from the applicable prospectus and distribution requirements under securities legislation, or unless an appropriate discretionary order is obtained pursuant to applicable security laws. It has been advised and afforded the full opportunity to consult with its own legal and other professional advisors in connection with any applicable re-sale restrictions.Securities; (d) It has been independently advised that the Purchased Units are being offered for sale only on a "private placement" basis and that the The sale and delivery of the Purchased Securities underlying the Purchased Units to the Subscriber is conditional upon such sale being exempt from the requirement to file a registration and prospectus filing requirements in connection with the distribution of the Units under any applicable law governing the sale of such securities Applicable Securities Laws or upon the issuance of such orders, consents or approvals as may be required to permit such sale without the requirement of filing a prospectus.; (e) It has further been independently advised as The Securities are subject to applicable resale restrictions in under Applicable Securities Laws and the jurisdiction in which it resides, confirms that no representation has been made to it by or on behalf Subscriber will comply with all applicable Laws concerning any resale of the Corporation Securities and the Subscriber will consult with its legal advisors with respect thereto, acknowledges that it is aware of the characteristics of the Purchased Securities underlying the Purchased Units, the risks relating to an investment therein and of the fact that it may not be able complying with any restrictions applying to resell the Purchased Securities underlying the Purchased Units except in accordance with exemptions under applicable securities legislation and regulatory policy.such resale; (f) The None of the Securities have been registered under the U.S. Securities Act or the Applicable Securities Laws of any State in the United States, and the Subscriber acknowledges that may not offer, sell or otherwise transfer the Purchased Units are subject Securities, directly or indirectly, within the United States or to, or for the account or benefit of, a U.S. Person, unless (i) the offer and sale of the Securities is registered under the U.S. Securities Act and the Applicable Securities Laws of all applicable States or (ii) an exemption from such registration requirements is available and the Subscriber, prior to such sale or transfer, has furnished to the termsCorporation an opinion of counsel, conditions and provisions of this subscription agreement.recognized standing reasonably satisfactory to the Corporation, or other certifications reasonably satisfactory to the Corporation, to that effect; (g) A prospectus will Hedging transactions involving the Securities may not be filed by conducted unless such transactions are in compliance with the Corporation to qualify provisions of the Purchased U.S. Securities or any of them.Act and in each case only in accordance with Applicable Securities Laws; (h) The Purchased Securities shall Units are being offered for sale on a “private placement” basis; (i) A finder’s fee or commission, payable in Warrants, will be paid to Southern Arc Minerals Inc. who introduced the Subscriber to the Offering. Additionally, finder’s fees or commissions, payable in cash or securities of the Corporation, may be paid to eligible individuals or entities who introduce investors who participate in the balance of the Current Offering. All finder’s fees or commissions are subject to compliance with CSE policies and Applicable Securities Laws; (j) The Units subscribed for by the Subscriber form part of a forty-larger offering of Units being made by the Corporation (the “Current Financing”), of up to 25,000,000 Units for gross proceeds of up to $2,500,000, with closings to occur, subject to regulatory approval, in one or multiple tranches; (41k) day hold period The Subscriber is solely responsible for obtaining such tax and legal advice from its own advisors as it considers appropriate in connection with the execution, delivery and performance by it of this Agreement and the transactions contemplated hereunder (including the resale and transfer restrictions referred to herein); (l) The Subscriber understands and agrees that there may be material tax consequences as a result of acquiring, holding or disposing of the Securities. The Corporation gives no opinion and makes no representation with respect to the tax consequences under United States, Canadian, state, provincial, local or foreign tax Law as a result of the Subscriber acquiring, holding or disposing of the Securities, and the Subscriber acknowledges that it is solely its responsibility for determining the tax consequences of an investment in the U.S.Units; (m) In accepting this Agreement, the Corporation is relying upon the representations, warranties, covenants and acknowledgements of the Subscriber set out herein including, without limitation, in connection with determining the eligibility of the Subscriber to purchase the Units under Applicable Securities Laws. The Subscriber hereby agrees to notify the Corporation immediately of any change in any representation, warranty, covenant, acknowledgement or other information relating to the Subscriber contained in this Agreement that takes place prior to the Closing; (n) The Subscriber consents to the Corporation making a notation on its records or giving instructions to any registrar or transfer agent of the Corporation in order to implement the restrictions on transfer set forth and described in this Agreement, and the Corporation will refuse to register any transfer of the Securities not made in accordance with Regulation S, pursuant to "Category 2" of Regulation S an effective registration statement under the U.S. Securities Act of 1933, as amended, which period shall commence or pursuant to an exemption from the date registration requirements of issuance, and the certificates representing the same shall be engrossed with the following legend, which shall be the only legend engrossed on such certificates relating to resale in the U.S.: "The securities represented by this certificate may not be sold, transferred, hypothecated or otherwise traded until July *, 2002, pursuant to "Category 2" of Regulation S under the U.S. Securities Act and in accordance with Applicable Securities Laws of the applicable state; (o) The Subscriber is solely responsible for all costs relating to lost Unit Share, Warrant or Warrant Share certificates issued with respect to this Agreement delivered to the address for delivery noted on page 1 hereof, and all costs relating to any future permitted removal of any legends affixed to Unit Share, Warrant and Warrant Share certificates issued pursuant to this Agreement; (p) The Corporation has advised the Subscriber that the Corporation is relying on an exemption from the requirements to provide the Subscriber with a prospectus under Applicable Securities Laws and, as a consequence of acquiring the Units pursuant to this exemption, certain protections, rights and remedies provided by such Laws, including statutory rights of rescission or damages, will not be available to the Subscriber; (q) No person has made to the Subscriber any written or oral representations: (i) That any person will resell or repurchase the Unit Shares, Warrants or Warrant Shares; (ii) That any person will refund the purchase price of the Units; or (iii) As to the future price or value of any of the Unit Shares, Warrants or Warrant Shares; and (r) Upon the issuance thereof, and until such time as the same is no longer required under Applicable Securities Laws, any certificates representing the Unit Shares and Warrants (and the Warrant Shares, if applicable), and all securities issued in exchange therefor or in substitution thereof, will bear legends in substantially the following form: THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, as amendedAS AMENDED (THE “U.S. SECURITIES ACT”), OR ANY U.S. STATE SECURITIES LAWS, AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE U.S. SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE U.S. SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. HEDGING TRANSACTIONS INVOLVING THESE SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE U.S. SECURITIES ACT. UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THIS SECURITY MUST NOT TRADE THE SECURITY BEFORE [INSERT THE DATE THAT IS 4 MONTHS AND A DAY AFTER THE DISTRIBUTION DATE]."