<SEC-DOCUMENT>0001477932-18-004579.txt : 20180921
<SEC-HEADER>0001477932-18-004579.hdr.sgml : 20180921
<ACCEPTANCE-DATETIME>20180921060606
ACCESSION NUMBER:		0001477932-18-004579
CONFORMED SUBMISSION TYPE:	6-K
PUBLIC DOCUMENT COUNT:		6
CONFORMED PERIOD OF REPORT:	20180921
FILED AS OF DATE:		20180921
DATE AS OF CHANGE:		20180921

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			AVINO SILVER & GOLD MINES LTD
		CENTRAL INDEX KEY:			0000316888
		STANDARD INDUSTRIAL CLASSIFICATION:	METAL MINING [1000]
		IRS NUMBER:				000000000
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		6-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-35254
		FILM NUMBER:		181080492

	BUSINESS ADDRESS:	
		STREET 1:		570 GRANVILLE STREET
		STREET 2:		SUITE 900
		CITY:			VANCOUVER BC CANADA
		STATE:			A1
		ZIP:			V6C 3P1
		BUSINESS PHONE:		6046823701

	MAIL ADDRESS:	
		STREET 1:		570 GRANVILLE STREET
		STREET 2:		SUITE 900
		CITY:			VANCOUVER
		STATE:			A1
		ZIP:			V6C 3P1

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	INTERNATIONAL AVINO MINES LTD
		DATE OF NAME CHANGE:	19950607

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	AVINO MINES & RESOURCES LTD
		DATE OF NAME CHANGE:	19950607
</SEC-HEADER>
<DOCUMENT>
<TYPE>6-K
<SEQUENCE>1
<FILENAME>avino_6k.htm
<DESCRIPTION>FORM 6-K
<TEXT>
<html><head><title>avino_6k.htm</title><!--Document Created by EDGARMaster--></head><BODY spellcheck="true" style="text-align:justify;font:10pt TIMES NEW ROMAN;margin:0px 7%"><b> <table style="FONT-SIZE: 1px" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td> <div style="HEIGHT: 4px; WIDTH: 100%; BACKGROUND: #000000; MARGIN: 0px 0px 2px" name="hrule"></div> <div style="HEIGHT: 2px; WIDTH: 100%; BACKGROUND: #000000" name="hrule"></div></td></tr></table> <p style="MARGIN: 0px">&nbsp;</p></b> <p style="MARGIN: 0px" align="center"><b><font size="3">UNITED STATES</font></b></p> <p style="MARGIN: 0px" align="center"><b><font size="3">SECURITIES AND EXCHANGE COMMISSION</font></b></p> <p style="MARGIN: 0px" align="center"><b><font size="3">Washington, D.C. 20549</font></b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="center"><b><font size="5">FORM 6-K</font></b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="center"><b>REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16</b></p> <p style="MARGIN: 0px" align="center"><b>UNDER THE SECURITIES EXCHANGE ACT OF 1934</b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="center">For the Month of <b>September 2018</b></p> <p style="MARGIN: 0px" align="left">&nbsp;</p> <p style="MARGIN: 0px" align="center">Commission File Number: <b>001-35254</b></p><b>&nbsp; <p style="MARGIN: 0px" align="center"> <table style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cols="1" cellpadding="0" width="50%" align="center" border="0"> <tr> <td style="BORDER-BOTTOM: black 1px solid"> <p style="MARGIN: 0px" align="center"><b><font size="5">AVINO SILVER &amp; GOLD MINES LTD.</font></b></p></td></tr></table></p></b> <p style="MARGIN: 0px" align="left">&nbsp;</p> <p style="MARGIN: 0px" align="center"><b><u>Suite 900, 570 Granville Street, Vancouver, BC V6C 3P1</u></b></p> <p style="MARGIN: 0px" align="center">(Address of principal executive offices)</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px">Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F. <font style="FONT-FAMILY: Wingdings">x</font> Form 20-F &nbsp;&nbsp;&nbsp;<font style="FONT-FAMILY: Wingdings">&#168;</font> Form 40-F</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px">Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): <font style="FONT-FAMILY: Wingdings">&#168;</font></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px">Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): <font style="FONT-FAMILY: Wingdings">&#168;</font></p> <p style="MARGIN: 0px">&nbsp; <table style="FONT-SIZE: 1px" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td> <div style="HEIGHT: 2px; WIDTH: 100%; BACKGROUND: #000000; MARGIN: 0px 0px 2px" name="hrule"></div> <div style="HEIGHT: 4px; WIDTH: 100%; BACKGROUND: #000000" name="hrule"></div></td></tr></table></p> <p style="MARGIN: 0px"> <table class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">On September 21, 2018, Avino Silver &amp; Gold Mines, Ltd. (the &#8220;Company&#8221;) entered into an underwriting agreement (the &#8220;Underwriting Agreement&#8221;) with H.C. Wainwright &amp; Co., LLC, as representative of the underwriters named therein (&#8220;Underwriters&#8221;), relating to the Offering, issuance and sale (the &#8220;Offering&#8221;) of 6,239,867 of our common shares and warrants to purchase up to 6,239,867 common shares and the common shares that are issuable from time to time upon exercise of the warrants. The common shares and the warrants will be sold in fixed combination, with one warrant to purchase one common shares accompanying each common share sold. The combined purchase price per common share and warrant is $0.65 for an aggregate gross proceeds of $4,055,914. </p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">Each warrant will have an exercise price of $0.80 per common share, will be exercisable immediately by the holders upon issuance and has a term of five years from the initial exercise date. The common shares and the warrants are immediately separable and will be issued separately, but must be purchased together in this Offering. There is not expected to be any trading market for the warrants issued in the Offering.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">Pursuant to the Underwriting Agreement, the Underwriters have agreed to purchase the common shares and accompanying warrants from the Company at a price of $0.6045 per share and accompanying warrant, which will result in approximately $3,422,000 (excluding the purchase of any common shares or warrants pursuant to the overallotment option granted to the Underwriters) of net proceeds to the Company after deducting the underwriting discount and estimated offering expenses. The Offering is expected to close on or about September 25, 2018, subject to customary closing conditions including obtaining NYSE American and TSX approvals. The Company intends to allocate the net proceeds of the Offering for primarily advancing the development of the Avino mine and its operations and production, and to a lesser extent for the exploration and development of the Bralorne Mine Property, and for general working capital. All of the common shares and warrants in the Offering are being sold by the Company.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">In addition, the Company granted to the representative&nbsp;of the Underwriters an option, exercisable in whole or in part at any time for a period of 45 days following September 21, 2018, to have the Underwriters purchase up to an additional 935,979 common shares and warrants to purchase up to 935,979 common shares at a public offering price of $0.65 per share, less the underwriting discount, to cover overallotments, if any. </p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">The Offering is being made pursuant to the Company&#8217;s effective shelf registration statement on Form F-3 (Registration No. 333-226963) filed with the Securities and Exchange Commission (the &#8220;SEC&#8221;) on August 21, 2018, and declared effective on September 5, 2018. The Company has filed a final prospectus supplement, dated September 21, 2018, relating to the issuance and sale of the common shares and warrants with the SEC.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">H.C. Wainwright &amp; Co. is acting as the sole book-running manager for the Offering. Roth Capital Partners is acting as co-manager for the Offering. A.G.P./Alliance Global Partners is acting as a financial adviser for the Offering.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">The Underwriting Agreement contains customary representations, warranties and agreements by the Company, customary conditions to closing, indemnification obligations of the Company and the Underwriters, including for liabilities under the Securities Act of 1933, as amended, other obligations of the parties and termination provisions.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">In addition, pursuant to the terms of the Underwriting Agreement, each of the Company&#8217;s directors and executive officers have entered into &#8220;lock-up&#8221; agreements with the Underwriter that generally prohibit, without the prior written consent of the Underwriter, the sale, transfer or other disposition of securities of the Company for a period ending 90 days following September 21, 2018.</p> <p style="MARGIN: 0px" align="justify">&nbsp; <table id="pagebreak51d46599-281d-4d69-802d-7f284277af04" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">2</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">The representations, warranties and covenants contained in the Underwriting Agreement were made only for purposes of such agreement and as of specific dates, were solely for the benefit of the parties to such agreement and may be subject to limitations agreed upon by the contracting parties.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">The Underwriting Agreement is filed as Exhibit 1.1 hereto and a copy of the form of Common Share Purchase Warrant is filed as Exhibit 4.1 hereto. The foregoing description of the terms of the Underwriting Agreement is qualified in its entirety by reference to such exhibit. A copy of the opinion of Salley Bowes Harwardt Law Corp. relating to the legality of the issuance and sale of the common shares and accompanying warrants in the Offering is attached as Exhibit 5.1 hereto.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="justify"><b>Forward-Looking Statements</b></p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">The statements in this report related to the completion, timing and size of the Offering are &#8220;forward-looking&#8221; statements. These forward-looking statements are based upon the Company&#8217;s current expectations. Forward-looking statements involve risks and uncertainties. The Company&#8217;s actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of these risks and uncertainties, which include, without limitation, risks related to market conditions and the satisfaction of customary closing conditions related to the Offering. There can be no assurance that the Company will be able to complete the Offering on the anticipated terms, or at all.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">&nbsp;</p> <p style="MARGIN: 0px"><b>Incorporation by Reference </b></p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">The information set forth in this report on Form 6-K, including the exhibits hereto, is hereby incorporated by reference into the Company&#8217;s Registration Statement on Form F-3 as filed on August 21, 2018, and declared effective on September 5, 2018 (No. 333-226963). </p> <p style="MARGIN: 0px">&nbsp; <table id="pagebreak072de1a3-7f7c-46c5-9563-9c1edea1ddd4" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">3</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="center"><b>SIGNATURES</b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td>&nbsp;</td> <td colspan="2"> <p style="MARGIN: 0px"><b>Avino Silver &amp; Gold Mines, Ltd.</b></p></td> <td></td></tr> <tr> <td width="50%">&nbsp;</td> <td width="3%">&nbsp;</td> <td width="35%">&nbsp;</td> <td width="12%">&nbsp;</td></tr> <tr> <td>Date: September 21, 2018</td> <td>By:</td> <td style="BORDER-BOTTOM: black 1px solid"><em>/s/ Malcolm Davidson</em></td> <td></td></tr> <tr> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td>Malcolm Davidson</td> <td>&nbsp;</td></tr> <tr> <td>&nbsp;</td> <td>&nbsp;</td> <td>Chief Financial Officer</td> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak59e209d7-f1b0-45c1-bbca-b25e3e3a463a" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">4</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="center"><b>EXHIBIT INDEX </b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px">The following exhibits are filed as part of this Form 6-K: </p> <p style="MARGIN: 0px">&nbsp;</p> <table style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td style="BORDER-BOTTOM: black 1px solid" width="6%"> <p style="MARGIN: 0px" align="left"><b>Exhibit</b></p></td> <td width="2%"> <p style="MARGIN: 0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: black 1px solid"> <p style="MARGIN: 0px"><b>Description</b></p></td></tr> <tr> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr height="15" bgcolor="#cceeff"> <td valign="top"> <p style="MARGIN: 0px"><a href="avino_ex11.htm">1.1</a></p></td> <td valign="bottom"> <p style="MARGIN: 0px">&nbsp;</p></td> <td valign="top"> <p style="MARGIN: 0px"><a href="avino_ex11.htm">Underwriting Agreement dated September 21, 2018 by and between Avino Silver &amp; Gold Mines Ltd. and H.C. Wainwright &amp; Co., LLC</a></p></td></tr> <tr height="15" bgcolor="#ffffff"> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td></tr> <tr height="15" bgcolor="#cceeff"> <td valign="top"> <p style="MARGIN: 0px"><a href="avino_ex41.htm">4.1</a></p></td> <td valign="bottom"> <p style="MARGIN: 0px">&nbsp;</p></td> <td valign="top"> <p style="MARGIN: 0px"><a href="avino_ex41.htm">Form of Common Share Purchase Warrant of Avino Silver &amp; Gold Mines Ltd.</a></p></td></tr> <tr height="15" bgcolor="#ffffff"> <td>&nbsp;</td> <td>&nbsp;</td> <td>&nbsp;</td></tr> <tr height="15" bgcolor="#cceeff"> <td valign="top"> <p style="MARGIN: 0px"><a href="avino_ex51.htm">5.1</a></p></td> <td valign="bottom"> <p style="MARGIN: 0px">&nbsp;</p></td> <td valign="top"> <p style="MARGIN: 0px"><a href="avino_ex51.htm">Opinion of Salley Bowes Harwardt Law Corp.</a></p></td></tr> <tr height="15" bgcolor="#ffffff"> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr height="15" bgcolor="#cceeff"> <td valign="top"> <p style="MARGIN: 0px"><a href="avino_ex991.htm">99.1</a></p></td> <td valign="bottom"> <p style="MARGIN: 0px">&nbsp;</p></td> <td valign="top"> <p style="MARGIN: 0px"><a href="avino_ex991.htm">Press release of Avino Silver &amp; Gold Mines Ltd. issued September 21, 2018.</a></p></td></tr></table> <p style="MARGIN: 0px">&nbsp; <table class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">5</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p></BODY><!--Document Created by EDGARMaster--></html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-1.1
<SEQUENCE>2
<FILENAME>avino_ex11.htm
<DESCRIPTION>UNDERWRITING AGREEMENT
<TEXT>
<html><head><title>avino_ex11.htm</title><!--Document Created by EDGARMaster--></head><BODY spellcheck="true" style="text-align:justify;font:10pt TIMES NEW ROMAN;margin:0px 7%"><p style="MARGIN: 0px" align="right"><b>EXHIBIT 1.1</b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in" align="center"><b>UNDERWRITING AGREEMENT</b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in" align="center"><b>6,239,867 SHARES </b><b><b>OF COMMON SHARES AND </b></b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in" align="center"><b><b><b>6,239,867 </b>WARRANTS OF</b></b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in" align="center"><b>AVINO SILVER &amp; GOLD MINES LTD.</b></p> <p style="MARGIN: 0px 0px 0px 0in" align="left">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in" align="right">September 21, 2018</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in">H.C. WAINWRIGHT &amp; CO., LLC</p> <p style="MARGIN: 0px 0px 0px 0in">As the Representative of the</p> <p style="MARGIN: 0px 0px 0px 0in">Several underwriters, if any, named in <u>Schedule I</u> hereto</p> <p style="MARGIN: 0px 0px 0px 0in">c/o H.C. Wainwright &amp; Co., LLC</p> <p style="MARGIN: 0px 0px 0px 0in">430 Park Avenue</p> <p style="MARGIN: 0px 0px 0px 0in">New York, New York 10022</p> <p style="MARGIN: 0px 0px 0px 0in">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in">Ladies and Gentlemen:</p> <p style="MARGIN: 0px 0px 0px 0in">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0.5in" align="justify">The undersigned, Avino Silver &amp; Gold Mines Ltd., a company amalgamated under the laws of the Province of British Columbia, Canada (the &#8220;<u>Company</u>&#8221;), hereby confirms its agreement (this &#8220;<u>Agreement</u>&#8221;) with the several underwriters (such underwriters, including the Representative (as defined below), the &#8220;<u>Underwriters</u>&#8221; and each an &#8220;<u>Underwriter</u>&#8221;) named in <u>Schedule I</u> hereto for which H.C. Wainwright &amp; Co., LLC is acting as representative to the several Underwriters (the &#8220;<u>Representative</u>&#8221; and if there are no Underwriters other than the Representative, references to multiple Underwriters shall be disregarded and the term Representative as used herein shall have the same meaning as Underwriter) on the terms and conditions set forth herein.</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0.5in" align="justify">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0.5in" align="justify">It is understood that the several Underwriters are to make a public offering of the Public Securities as soon as the Representative deems it advisable to do so. The Public Securities are to be initially offered to the public outside of Canada at the initial public offering price set forth in the Prospectus. The Representative may from time to time thereafter change the public offering price and other selling terms. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 0.5in" align="justify">It is further understood that you will act as the Representative for the Underwriters in the offering and sale of the Closing Securities and, if any, the Option Securities in accordance with this Agreement.</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0in" align="justify">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 0in" align="center"><b>ARTICLE I.</b></p> <p style="MARGIN: 0px; TEXT-INDENT: 0in" align="center"><b>DEFINITIONS</b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">1.1 <u>Definitions</u>. In addition to the terms defined elsewhere in this Agreement, for all purposes of this Agreement, the following terms have the meanings set forth in this Section 1.1:</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Affiliate</u>&#8221; means with respect to any Person, any other Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with such Person as such terms are used in and construed under Rule 405 under the Securities Act.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak0f231a5b-0a85-4d31-b4fe-19656c49e4d0" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">1</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Applicable Prospectus</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(n).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Applicable Law</u>&#8221; means any and all laws, including all federal, provincial, state and local statutes, codes, ordinances, guidelines, decrees, rules, regulations and municipal by- laws and all judicial, arbitral, administrative, ministerial, departmental or regulatory judgments, orders, directives, decisions, rulings or awards or other requirements of any Governmental Authority, binding on or affecting the person referred to in the context in which the term is used.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>BC 72-503</u>&#8221; means British Columbia Instrument 72-503 <i>Distribution of Securities Outside of British Columbia</i>. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>BHCA</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(ggg).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Board of Directors</u>&#8221; means the board of directors of the Company.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Business Day</u>&#8221; means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or any day on which banking institutions in the State of New York are authorized or required by law or other governmental action to close.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Canadian Securities Laws</u>&#8221; means, collectively as applied and interpreted, the respective rules, regulations, blanket rulings, orders and notices made thereunder and the local, uniform, national and multilateral instruments and policies adopted by the Canadian Commissions in Canada applicable to the Company.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Closing</u>&#8221; means the closing of the purchase and sale of the Closing Securities pursuant to Section 2.1.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Closing Date</u>&#8221; means the hour and the date on the Trading Day on which all conditions precedent to (i) the Underwriters&#8217; obligations to pay the Closing Purchase Price and (ii) the Company&#8217;s obligations to deliver the Closing Securities, in each case, have been satisfied or waived, but in no event later than 10:00 a.m. (New York City time) on the second (2<sup>nd</sup>) Trading Day following the date hereof or at such earlier time as shall be agreed upon by the Representative and the Company.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Closing Purchase Price</u>&#8221; shall have the meaning ascribed to such term in Section 2.1(b), which aggregate purchase price shall be net of the underwriting discounts and commissions.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Closing Securities</u>&#8221; shall have the meaning ascribed to such term in Section 2.1(a)(ii).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreakb465990d-88bf-4afc-8dfd-18023c12bca6" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">2</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Closing Shares</u>&#8221; shall have the meaning ascribed to such term in Section 2.1(a)(i).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Closing Warrants</u>&#8221; shall have the meaning ascribed to such term in Section 2.1(a)(ii).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Code</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(rr).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Combined Purchase Price</u>&#8221; shall have the meaning ascribed to such term in Section 2.1(b).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Commission</u>&#8221; means the United States Securities and Exchange Commission.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Common Shares</u>&#8221; means the common shares of the Company, no par value per share, and any other class of securities into which such securities may hereafter be reclassified or changed. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Common Share Equivalents</u>&#8221; means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire at any time Common Shares, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Shares.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Company Auditor</u>&#8221; means Manning Elliott LLP, with offices located at 1050 West Pender Street, 11<sup>th</sup> Floor, Vancouver, British Columbia V6E 3S7 Canada.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Company Counsel</u>&#8221; means Lewis Brisbois Bisgaard &amp; Smith LLP with offices located at 333 Bush Street, Suite 1100, San Francisco, California 94104 and Salley Bowes Harwardt Law Corporation with offices located at Suite 1750, 1185 West Georgia Street, Vancouver, British Columbia V6E 4E6.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Controlling Person</u>&#8221; shall have the meaning ascribed to such term in Section 6.1.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Corporate Records</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(t).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>EDGAR</u>&#8221; means the Commission&#8217;s Electronic Data Gathering, Analysis and Retrieval system.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Effective Date</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(a).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>EGS</u>&#8221; means Ellenoff Grossman &amp; Schole LLP, with offices located at 1345 Avenue of the Americas, New York, New York 10105.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Entity</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(ccc).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Environmental Laws</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(ww)(i).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak6855ecd1-6bb1-48d9-8079-c11f0f2a615c" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">3</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Environmental Permits</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(ww)(ii).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Evaluation Date</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(v).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Exchange Act</u>&#8221; means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Execution Date</u>&#8221; shall mean the date on which the parties execute and enter into this Agreement.</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Exempt Issuance</u>&#8221; means the issuance of (a) Common Shares or options to employees, officers or directors of the Company pursuant to any stock or option plan duly adopted for such purpose by a majority of the non-employee members of the Board of Directors or a majority of the members of a committee of non-employee directors established for such purpose, (b) securities upon the exercise or exchange of or conversion of any Securities issued hereunder and/or other securities exercisable or exchangeable for or convertible into Common Shares issued and outstanding on the date of this Agreement, provided that such securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securities or to extend the term of such securities, and (c) securities issued pursuant to acquisitions or strategic transactions approved by a majority of the disinterested directors of the Company, provided that such securities are issued as &#8220;restricted securities&#8221; (as defined in Rule 144) and carry no registration rights that require or permit the filing of any registration statement in connection therewith within 90 days following the Closing Date, and provided that any such issuance shall only be to a Person (or to the equity holders of a Person) which is, itself or through its subsidiaries, an operating company or an owner of an asset in a business synergistic with the business of the Company and shall provide to the Company additional benefits in addition to the investment of funds, but shall not include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary business is investing in securities.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>FCPA</u>&#8221; means the Foreign Corrupt Practices Act of 1977, as amended.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Federal Reserve</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(ggg).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Financial Statements</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(p).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>FINRA</u>&#8221; means the Financial Industry Regulatory Authority.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>GAAP</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(b).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Governmental Authority</u>&#8221; means (i) any federal, provincial, state, local, municipal, national or international government or governmental authority, regulatory or administrative agency, governmental commission, department, board, bureau, agency or instrumentality, court, tribunal, arbitrator or arbitral body (public or private); (ii) any self-regulatory organization; or (iii) any political subdivision of any of the foregoing.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreakfbbc7fa4-2253-4e44-b88d-4db359757565" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">4</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Hazardous Substances</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(ww)(i).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>IFRS</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(p).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Liens</u>&#8221; means a lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Lock-Up Agreements</u>&#8221; means the lock-up agreements that are delivered on the date hereof by each of the Company&#8217;s officers and directors, in the form of <u>Exhibit E</u> attached hereto.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Material Adverse Effect</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(r).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Material Properties</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(mm)(i).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Material Subsidiaries</u>&#8221; shall have the meaning ascribed to such term in Section 3(s).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Member</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(ccc).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Money Laundering Laws</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(bbb).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Offering</u>&#8221; shall have the meaning ascribed to such term in Section 2.1(c).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Option Closing Date</u>&#8221; shall have the meaning ascribed to such term in Section 2.2(c).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Option Closing Purchase Price</u>&#8221; shall have the meaning ascribed to such term in Section 2.2(b), which aggregate purchase price shall be net of the underwriting discounts and commissions.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Option Securities</u>&#8221; shall have the meaning ascribed to such term in Section 2.2(a).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Option Shares</u>&#8221; shall have the meaning ascribed to such term in Section 2.2(a).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Option Warrants</u>&#8221; shall have the meaning ascribed to such term in Section 2.2(a).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Over-Allotment Option</u>&#8221; shall have the meaning ascribed to such term in Section 2.2(a).</p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="justify"> <table id="pagebreak6a64778a-72ab-4a55-9196-8d5820180744" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">5</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Permitted Free Writing Prospectus</u>&#8221; shall have the meaning ascribed to such term in Section 4.2(d).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Permits</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(mm)(iii).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Person</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(z).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>PFIC</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(eee).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Preliminary Prospectus</u>&#8221; means, if any, any preliminary prospectus relating to the Public Securities included in the Registration Statement or filed with the Commission pursuant to Rule 424(b).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Proceeding</u>&#8221; means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding, such as a deposition), whether commenced or threatened.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Project Rights</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(mm)(ii).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Prospectus</u>&#8221; means the final prospectus filed for the Registration Statement.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Prospectus Supplement</u>&#8221; means, if any, any supplement to the Prospectus complying with Rule 424(b) of the Securities Act that is filed with the Commission.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Public Securities</u>&#8221; means, collectively, the Closing Securities and, if any, the Option Securities.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Registration Statement</u>&#8221; means, collectively, the various parts of the registration statement prepared by the Company on Form F-3 (File No. 333- 226963) with respect to the Public Securities, each as amended as of the date hereof, including the Prospectus and Prospectus Supplement, if any, the Preliminary Prospectus, if any, and all exhibits filed with or incorporated by reference into such registration statement.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Regulation M</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(tt).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Reports</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(mm)(vii).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Rule 424</u>&#8221; means Rule 424 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Sanctions</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(ccc).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>SEC Reports</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(b).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Securities</u>&#8221; means the Closing Securities, the Option Securities and the Warrant Shares.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak55bd4fc3-62bf-47ae-872d-325d0bd4dc21" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">6</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Securities Act</u>&#8221; means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Share Purchase Price</u>&#8221; shall have the meaning ascribed to such term in Section 2.1(b).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Shares</u>&#8221; means, collectively, the Common Shares delivered to the Underwriters in accordance with Section 2.1(a)(i) and Section 2.2(a).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Subsidiary</u>&#8221; means any subsidiary of the Company and shall, where applicable, also include any direct or indirect subsidiary of the Company formed or acquired after the date hereof.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Time of Sale Prospectus</u>&#8221; means the U.S. Prospectus together with the information and the free writing prospectuses, if any, and each &#8220;road show&#8221; (as defined in Rule 433 under the Securities Act), if any, related to the offering of the Securities contemplated hereby that is a &#8220;written communication&#8221; (as defined in Rule 405 under the Securities Act).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Title and Corporate Opinions</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(mm)(x).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Trading Day</u>&#8221; means a day on which the principal Trading Market is open for trading.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Trading Market</u>s&#8221; means any of the following markets or exchanges on which the Common Shares are listed or quoted for trading on the date in question: the NYSE American and Toronto Stock Exchange or, if applicable, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market or the New York Stock Exchange (or any successors to any of the foregoing).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Transaction Documents</u>&#8221; means this Agreement, the Warrants, the Lock-Up Agreements, and any other documents or agreements executed in connection with the transactions contemplated hereunder.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Transfer Agent</u>&#8221; means Computershare, with offices located at 510 Burrard St, 3rd Floor, Vancouver British Columbia, V6C 3B9and any successor transfer agent of the Company.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>U.S. Securities Laws</u>&#8221; means all applicable securities laws in the United States, including without limitation, the Securities Act, the Exchange Act and the rules and regulations promulgated thereunder, and any applicable state securities laws.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Variable Rate Transaction</u>&#8221; shall have the meaning ascribed to such term in Section 4.20(b).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Warrant Certificates</u>&#8221; shall have the meaning ascribed to such term in Section 3.1(j).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak56db32ad-837d-4af3-8623-f75bd7dc2e53" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">7</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Warrant Purchase Price</u>&#8221; shall have the meaning ascribed to such term in Section 2.1(b).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Warrant Shares</u>&#8221; means the Common Shares issuable upon exercise of the Warrants.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Warrants</u>&#8221; means, collectively, the Common Share purchase warrants delivered to the Underwriters in accordance with Section 2.1(a)(ii) and Section 2.2, which Warrants shall be exercisable immediately and have a term of exercise equal to&nbsp;five (5) &nbsp;years, in the form of <u>Exhibit D</u> attached hereto.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0in" align="center"><b>ARTICLE II.</b></p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0in" align="center"><b>PURCHASE AND SALE</b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">2.1 <u>Closing</u>. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(a) Upon the terms and subject to the conditions set forth herein, the Company agrees to sell in the aggregate&nbsp;6,239,867 Common Shares and 6,239,867 Warrants, and each Underwriter agrees to purchase, severally and not jointly, at the Closing, the following securities of the Company:</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 0.5in" align="justify">(i) the number of Common Shares (the &#8220;<u>Closing Shares</u>&#8221;) set forth opposite the name of such Underwriter on <u>Schedule I</u> hereof; and</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 0.5in" align="justify">(ii) Warrants to purchase up to the number of Common Shares set forth opposite the name of such Underwriter on <u>Schedule I</u> hereof (the &#8220;<u>Closing Warrants</u>&#8221; and, collectively with the Closing Shares, the &#8220;<u>Closing Securities</u>&#8221;), which Warrants shall have an exercise price of $0.80, subject to adjustment as provided therein.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(b) The aggregate purchase price for the Closing Securities shall equal the amount set forth opposite the name of such Underwriter on <u>Schedule I</u> hereto (the &#8220;<u>Closing Purchase Price</u>&#8221;). The combined purchase price for one Share and a Warrant to purchase&nbsp;one Warrant Share shall be $0.6045 (the &#8220;<u>Combined Purchase Price</u>&#8221;) which shall be allocated as $0.5952 per Share (the &#8220;<u>Share Purchase Price</u>&#8221;) and $0.0093 per Warrant (the &#8220;<u>Warrant Purchase Price</u>&#8221;); and</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(c) On the Closing Date, each Underwriter shall deliver or cause to be delivered to the Company, via wire transfer, immediately available funds equal to such Underwriter&#8217;s Closing Purchase Price and the Company shall deliver to, or as directed by, such Underwriter its respective Closing Securities and the Company shall deliver the other items required pursuant to Section 2.3 deliverable at the Closing. Upon satisfaction of the covenants and conditions set forth in Sections 2.3 and 2.4, the Closing shall occur at the offices of EGS or such other location as the Company and Representative shall mutually agree. The Public Securities are to be offered initially to the public at the offering price set forth on the cover page of the Prospectus Supplement (the &#8220;<u>Offering</u>&#8221;). </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak1be160d4-5d4b-475c-a11b-dd20f1fbe6f1" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">8</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">2.2 <u>Over-Allotment Option</u>. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(a) For the purposes of covering any over-allotments in connection with the distribution and sale of the Closing Securities, the Representative is hereby granted an option (the &#8220;<u>Over-Allotment Option</u>&#8221;) to purchase, in the aggregate, up to 935,979 Common Shares (the &#8220;<u>Option Shares</u>&#8221;) and Warrants to purchase up to 935,979&nbsp;Common Shares (the &#8220;<u>Option Warrants</u>&#8221; and, collectively with the Option Shares, the &#8220;<u>Option Securities</u>&#8221;)<sup><sup>[1]</sup></sup> which may be purchased in any combination of Option Shares and/or Option Warrants at the Share Purchase Price and/or Warrant Purchase Price, respectively.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(b) In connection with an exercise of the Over-Allotment Option, (i) the purchase price to be paid for the Option Shares is equal to the product of the Share Purchase Price multiplied by the number of Option Shares to be purchased and (ii) the purchase price to be paid for the Option Warrants is equal to the product of the Warrant Purchase Price multiplied by the number of Option Warrants (the aggregate purchase price to be paid on an Option Closing Date, the &#8220;<u>Option Closing Purchase Price</u>&#8221;).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(c) The Over-Allotment Option granted pursuant to this Section 2.2 may be exercised by the Representative as to all (at any time) or any part (from time to time) of the Option Securities within&nbsp;45 days after the Execution Date. An Underwriter will not be under any obligation to purchase any Option Securities prior to the exercise of the Over-Allotment Option by the Representative. The Over-Allotment Option granted hereby may be exercised by the giving of oral notice to the Company from the Representative, which must be confirmed in writing by overnight mail or facsimile or other electronic transmission setting forth the number of Option Shares and/or Option Warrants to be purchased and the date and time for delivery of and payment for the Option Securities (each, an &#8220;<u>Option Closing Date</u>&#8221;), which will not be later than two (2) full Business Days after the date of the notice or such other time as shall be agreed upon by the Company and the Representative, at the offices of EGS or at such other place (including remotely by facsimile or other electronic transmission) as shall be agreed upon by the Company and the Representative. If such delivery and payment for the Option Securities does not occur on the Closing Date, each Option Closing Date will be as set forth in the notice. Upon exercise of the Over-Allotment Option, the Company will become obligated to convey to the Underwriters, and, subject to the terms and conditions set forth herein, the Underwriters will become obligated to purchase, the number of Option Shares and/or Option Warrants specified in such notice. The Representative may cancel the Over-Allotment Option at any time prior to the expiration of the Over-Allotment Option by written notice to the Company.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">2.3 <u>Deliveries</u>. The Company shall deliver or cause to be delivered to each Underwriter (if applicable) the following:</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(i) At the Closing Date, the Closing Shares and, as to each Option Closing Date, if any, the applicable Option Shares, which shares shall be delivered via The Depository Trust Company Deposit or Withdrawal at Custodian system for the accounts of the several Underwriters;</p> <p style="MARGIN: 0px">&nbsp;&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak3c88fbea-6801-42a1-8a12-29d5f39593e3" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">9</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(ii) At the Closing Date, the Closing Warrants and, as to each Option Closing Date, if any, the applicable Option Warrants in certificated form registered in the name or names and in such authorized denominations as the applicable Underwriter may request in writing at least two Business Day prior to the Closing Date and, if any, each Option Closing Date;</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(iii) The conditional acceptance of the Toronto Stock Exchange to the terms of the Offering;</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(iv) At the Closing Date, a legal opinion of Company Counsel addressed to the Underwriters, including, without limitation, a negative assurance letter, substantially in the form of <u>Exhibit A</u> attached hereto and as to the Closing Date and as to each Option Closing Date, if any, a bring-down opinion from Company Counsel in form and substance reasonably satisfactory to the Representative, including, without limitation, a negative assurance letter, addressed to the Underwriters and in form and substance satisfactory to the Representative;</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(v) Contemporaneously herewith, a cold comfort letter, addressed to the Underwriters and in form and substance satisfactory in all respects to the Representative from the Company Auditor dated, respectively, as of the date of this Agreement and a bring-down letter dated as of the Closing Date and each Option Closing Date, if any;</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(vi) On the Closing Date and on each Option Closing Date, the duly executed and delivered Officer&#8217;s Certificate, substantially in the form required by <u>Exhibit B</u> attached hereto;</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(vii) On the Closing Date and on each Option Closing Date, the duly executed and delivered Secretary&#8217;s Certificate, substantially in the form required by <u>Exhibit C</u> attached hereto; and</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(viii) Contemporaneously herewith, the duly executed and delivered Lock-Up Agreements.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">2.4 <u>Closing Conditions</u>. The respective obligations of each Underwriter hereunder in connection with the Closing and each Option Closing Date are subject to the following conditions being met:</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(i) the accuracy in all material respects when made and on the date in question (other than representations and warranties of the Company already qualified by materiality, which shall be true and correct in all respects) of the representations and warranties of the Company contained herein (unless as of a specific date therein);</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(ii) all obligations, covenants and agreements of the Company required to be performed at or prior to the date in question shall have been performed; </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreakc3f73167-30ca-4e3e-aca5-e48b6f2ab4c6" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">10</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(iii) the delivery by the Company of the items set forth in Section 2.3 of this Agreement; </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(iv) the Registration Statement shall be effective on the date of this Agreement and at each of the Closing Date and each Option Closing Date, if any, no stop order suspending the effectiveness of the Registration Statement shall have been issued and no proceedings for that purpose shall have been instituted or shall be pending or contemplated by the Commission and any request on the part of the Commission for additional information shall have been complied with to the reasonable satisfaction of the Representative;</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(v) by the Execution Date, if required by FINRA, the Underwriters shall have received clearance from FINRA as to the amount of compensation allowable or payable to the Underwriters as described in the Registration Statement;</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(vi) the Closing Shares, the Option Shares and the Warrant Shares shall have been approved for listing on the Trading Markets; and</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(vii) prior to and on each of the Closing Date and each Option Closing Date, if any: (i) there shall have been no material adverse change or development involving a prospective material adverse change in the condition or prospects or the business activities, financial or otherwise, of the Company from the latest dates as of which such condition is set forth in the Registration Statement and Prospectus; (ii) no action suit or proceeding, at law or in equity, shall have been pending or threatened against the Company or any Affiliate of the Company before or by any court or federal or state commission, board or other administrative agency wherein an unfavorable decision, ruling or finding may materially adversely affect the business, operations, prospects or financial condition or income of the Company, except as set forth in the Registration Statement and Prospectus; (iii) no stop order shall have been issued under the Securities Act and no proceedings therefor shall have been initiated or threatened by the Commission; and (iv) the Registration Statement and the Prospectus and any amendments or supplements thereto shall contain all material statements which are required to be stated therein in accordance with the Securities Act and the rules and regulations thereunder and shall conform in all material respects to the requirements of the Securities Act and the rules and regulations thereunder, and neither the Registration Statement nor the Prospectus nor any amendment or supplement thereto shall contain any untrue statement of a material fact or omit to state any 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.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreakec58bfff-f23f-432b-ba75-e0fde891f613" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">11</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0in" align="center"><b>ARTICLE III.</b></p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0in" align="center"><b>REPRESENTATIONS AND WARRANTIES</b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">3.1 <u>Representations and Warranties of the Company</u>. The Company represents and warrants to the Underwriters as of the Execution Date, as of the Closing Date and as of each Option Closing Date, if any, as follows:</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(a) <u>Registration Statement</u>. The Company was a &#8220;foreign private issuer&#8221; (as defined in Rule 405 under the Securities Act) when the Registration Statement was filed, and is eligible to use Form F-3 under the Securities Act to register the offering of the Public Securities under the Securities Act. The Company has filed with the Commission the Registration Statement under the Securities Act, which became effective on September 5, 2018 (the &#8220;<u>Effective Date</u>&#8221;), for the registration under the Securities Act of the Securities. At the time of such filing, the Company met the requirements of Form F-3 under the Securities Act. The Registration Statement meets the requirements set forth in Rule 415(a)(1)(x) under the Securities Act and complies with said Rule and the Prospectus Supplement will meet the requirements set forth in Rule 424(b). Any reference in this Agreement to the Registration Statement, the Prospectus or the Prospectus Supplement shall be deemed to refer to and include the documents incorporated by reference therein pursuant to Item 6 of Form F-3 which were filed under the Exchange Act, on or before the date of this Agreement, or the issue date of the Prospectus or the Prospectus Supplement, as the case may be; and any reference in this Agreement to the terms &#8220;amend,&#8221; &#8220;amendment&#8221; or &#8220;supplement&#8221; with respect to the Registration Statement, the Prospectus or the Prospectus Supplement shall be deemed to refer to and include the filing of any document under the Exchange Act after the date of this Agreement, or the issue date of the Prospectus or the Prospectus Supplement, as the case may be, deemed to be incorporated therein by reference. All references in this Agreement to financial statements and schedules and other information which is &#8220;contained,&#8221; &#8220;included,&#8221; &#8220;described,&#8221; &#8220;referenced,&#8221; &#8220;set forth&#8221; or &#8220;stated&#8221; in the Registration Statement, the Prospectus or the Prospectus Supplement (and all other references of like import) shall be deemed to mean and include all such financial statements and schedules and other information which is or is deemed to be incorporated by reference in the Registration Statement, the Prospectus or the Prospectus Supplement, as the case may be. No stop order suspending the effectiveness of the Registration Statement or the use of the Prospectus or the Prospectus Supplement has been issued, and no proceeding for any such purpose is pending or has been initiated or, to the Company&#8217;s knowledge, is threatened by the Commission. For purposes of this Agreement, &#8220;<u>free writing prospectus</u>&#8221; has the meaning set forth in Rule 405 under the Securities Act. The Company will not, without the prior notice of the Representative, prepare, use or refer to, any free writing prospectus. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(b) <u>SEC Reports; Financial Statements</u>. The Company has filed all reports, schedules, forms, statements and other documents required to be filed by the Company under the Securities Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the two years preceding the date hereof (or such shorter period as the Company was required by law or regulation to file such material) (the foregoing materials, including the exhibits thereto and documents incorporated by reference therein, together with the Prospectus and the Prospectus Supplement, being collectively referred to herein as the &#8220;<u>SEC Reports</u>&#8221;) on a timely basis or has received a valid extension of such time of filing and has filed any such SEC Reports prior to the expiration of any such extension. As of their respective dates, the SEC Reports complied in all material respects with the requirements of the Securities Act and the Exchange Act, as applicable, and none of the SEC Reports, when filed, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak58511889-3902-45fd-9067-379895f89ae0" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">12</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(c) <u>Listing and Maintenance Requirements</u>. The Common Shares are registered pursuant to Section 12(b) of the Exchange Act, and the Company has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the registration of the Common Shares under the Exchange Act nor has the Company received any notification that the Commission is contemplating terminating such registration. The Company has not, in the 12 months preceding the date hereof, received notice from any Trading Market on which the Common Shares are or have been listed or quoted to the effect that the Company is not in compliance with the listing or maintenance requirements of such Trading Market. The Company is, and has no reason to believe that it will not in the foreseeable future continue to be, in compliance with all such listing and maintenance requirements. The Common Shares are currently eligible for electronic transfer through the Depository Trust Company or another established clearing corporation and the Company is current in payment of the fees of the Depository Trust Company (or such other established clearing corporation) in connection with such electronic transfer.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(d) <u>Disclosure; 10b-5</u>. The Registration Statement (and any further documents to be filed with the Commission) contains all exhibits and schedules as required by the Securities Act. Each of the Registration Statement and any post-effective amendment thereto, if any, at the time it became effective, complied in all material respects with the Securities Act and the Exchange Act and the applicable rules and regulations under the Securities Act and did not and, as amended or supplemented, if applicable, will not, contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading. The Prospectus and the Prospectus Supplement, each as of its respective date, comply in all material respects with the Securities Act and the Exchange Act and the applicable rules and regulations. Each of the Prospectus and the Prospectus Supplement, as amended or supplemented, did not and will not contain as of the date thereof any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The SEC Reports, when they were filed with the Commission, conformed in all material respects to the requirements of the Exchange Act and the applicable rules and regulations, and none of such documents, when they were filed with the Commission, contained any untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein (with respect to the SEC Reports incorporated by reference in the Prospectus or Prospectus Supplement), in light of the circumstances under which they were made not misleading; and any further documents so filed and incorporated by reference in the Prospectus or Prospectus Supplement, when such documents are filed with the Commission, will conform in all material respects to the requirements of the Exchange Act and the applicable rules and regulations, as applicable, and will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made not misleading. No post-effective amendment to the Registration Statement reflecting any facts or events arising after the date thereof which represent, individually or in the aggregate, a fundamental change in the information set forth therein is required to be filed with the Commission. There are no documents required to be filed with the Commission in connection with the transaction contemplated hereby that (x) have not been filed as required pursuant to the Securities Act or (y) will not be filed within the requisite time period. There are no contracts or other documents required to be described in the Prospectus or Prospectus Supplement, or to be filed as exhibits or schedules to the Registration Statement, which have not been described or filed as required. The press releases disseminated by the Company during the twelve months preceding the date of this Agreement taken as a whole do not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made and when made, not misleading. The Company was not and is not an &#8220;ineligible issuer&#8221; as defined in Rule 405 under the Securities Act at the times specified in Rules 164 and 433 under the Securities Act in connection with the offering of the Securities.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak7d1c4686-4a61-4c8e-90a5-47444e5acdf4" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">13</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(e) <u>Compliance with Canadian Laws and Regulations </u>The Company is a reporting issuer in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Nova Scotia, New Brunswick, Prince Edward Island, and Newfoundland &amp; Labrador, and to the knowledge of the Company is in good standing under Canadian Securities Laws, is not in default in any material respect of any requirement of Canadian Securities Laws and is not included in a list of defaulting reporting issuers maintained by the applicable securities regulators in Canada. In particular, without limiting the foregoing, to the knowledge of the Company, the Company is in compliance at the date hereof with its obligations to make timely disclosure of all material changes to its business. The Company will rely upon section 4 of BCI 72-503 for the available exemption from registration and prospectus requirements in Canada in connection with the Offering of the Public Securities. To its knowledge, the Company is not a &#8220;related issuer&#8221; or &#8220;connected issuer&#8221; (as those terms are defined in National Instrument 33-105 - <i>Underwriting Conflicts</i> of the Canadian Securities Administrators) of any of the Underwriters.<u> </u></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(f) <u>No Conflicts</u>.<b> </b>Neither the execution of this Agreement, nor the issuance, offering or sale of the Public Securities, nor the consummation of any of the transactions contemplated herein and therein, nor the compliance by the Company with the terms and provisions hereof and thereof will conflict with, or will result in a breach of, any of the terms and provisions of, or has constituted or will constitute a default under, or has resulted in or will result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Company pursuant to the terms of any agreements, contracts, arrangements or understandings (written or oral) to which the Company may be bound or to which any of the property or assets of the Company is subject, except (i) such conflicts, breaches or defaults as may have been waived, and (ii) such conflicts, breaches and defaults that would not reasonably be expected to have a Material Adverse Effect (as defined below); nor will such action result (x) in any violation of the provisions of the organizational or governing documents of the Company, or (y) in any violation of the provisions of any statute or any order, rule or regulation applicable to the Company or of any Governmental Authority having jurisdiction over the Company, except such violations that would not reasonably be expected to have a Material Adverse Effect, either individually or in the aggregate.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreakb8728fdf-e9a3-400b-83a5-ba120eca325f" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">14</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(g) <u>Reports and Documents, etc.</u> There are no reports or information of the Company or, to the knowledge of the Company, of any third party, that in accordance with the requirements of the Canadian Securities Laws or U.S. Securities Laws must be made publicly available in connection with the offering of the Public Securities that have not been made publicly available as required. There are no documents of the Company or, to the knowledge of the Company, of any third party, required to be filed in Canada or with the Commission in the United States in connection with the Time of Sale Prospectus and the U.S. Prospectus that have not been filed as required pursuant to the Canadian Securities Laws or U.S. Securities Laws, as applicable. There are no agreements, contracts, arrangements or understandings (written or oral) or other documents of the Company or, to the knowledge of the Company, of any third party, required to be described in the Time of Sale Prospectus and the U.S. Prospectus which have not been described or filed as required pursuant to the Canadian Securities Laws or U.S. Securities Laws, as applicable.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(h) <u>Offering Materials Furnished to Underwriters</u><b><i>.</i></b> The Company has delivered or will deliver on the First Closing Date to the Representative (or with respect to the registration statement on Form F-3 and each amendment thereto, the Time of Sale Prospectus, the U.S. Prospectus, as amended or supplemented, and any free writing prospectus, made available on EDGAR) one complete manually signed copy of the registration statement on Form F-3, each amendment thereto and each consent and certificate of experts filed as a part thereof, and conformed copies (to the extent such documents contain signatures) of the registration statement on Form F-3 and each amendment thereto, the Preliminary Prospectuses, the Time of Sale Prospectus and the U.S. Prospectus, as amended or supplemented, and any free writing prospectus reviewed and consented to by the Representative, in such quantities and at such places as the Representative have reasonably requested for each of the Underwriters.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(i) <u>Warrants</u>. The Warrants will, as at the applicable closing, have been duly and validly created and the Warrant Shares have been authorized and allotted for issuance and upon the payment therefor and the issue thereof upon exercise of the Warrants in accordance with the terms thereunder, the Warrant Shares will be validly issued as fully paid and non-assessable Common Shares. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(j) <u>Corporate Action.</u> All necessary corporate action has been taken by the Company to authorize the issuance, sale and delivery of the Closing Shares, the Closing Warrants, the Warrant Shares, the Option Shares, the Option Warrants and the Option Warrant Shares, on the terms set forth in this Agreement, and each certificate representing the Warrants and the Option Warrants (the &#8220;<u>Warrant Certificates</u>&#8221;) will be, a valid and binding obligation of the Company enforceable against the Company in accordance with its terms, subject to bankruptcy, insolvency, moratorium or similar laws affecting creditors&#8217; rights generally and, except as limited by the application of equitable remedies, which may be granted in the discretion of a court of competent jurisdiction, and that enforcement of the rights to indemnity and contribution set out in this Agreement may be limited by Applicable Law.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreakb9afe582-928c-4863-90c5-26bb8d7b2225" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">15</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(k) <u>Distribution of Offering Material by the Company</u><b><i>.</i></b> The Company has not distributed and will not distribute, prior to the completion of the Underwriters&#8217; distribution of the Public Securities, any offering material in connection with the offering and sale of the Public Securities other than the Preliminary Prospectuses, the Time of Sale Prospectus, the U.S. Prospectus, and any free writing prospectus reviewed and consented to by the Representative on behalf of the Underwriters, or the Registration Statement.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(l) <u>Authorization; Enforceability</u><b><i>.</i></b> The Company has full corporate right, power and authority to enter into this Agreement and perform the transactions contemplated hereby. This Agreement has been duly authorized, executed and delivered by the Company and is a legal, valid and binding agreement of the Company enforceable in accordance with its terms, except to the extent that enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors&#8217; rights generally and by general equitable principles. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(m) <u>No Material Adverse Effect</u><b><i>.</i></b> Subsequent to the respective dates as of which information is given in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, if any (including any document deemed incorporated by reference therein), there has not been (i) any Material Adverse Effect, (ii) any transaction which is material to the Company and the Material Subsidiaries taken as a whole, (iii) any obligation or liability, direct or contingent (including any off-balance sheet obligations), incurred by the Company or any Material Subsidiary, which is material to the Company and the Material Subsidiaries taken as a whole, (iv) any material change in the capital stock or outstanding long-term indebtedness of the Company or any of the Material Subsidiaries or (v) any dividend or distribution of any kind declared, paid or made on the capital stock of the Company or any Material Subsidiary, other than in each case above in the ordinary course of business or as otherwise disclosed in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(n) <u>Independent Accountants</u><b><i>.</i></b> Manning Elliott LLP, who have delivered their report with respect to the audited Financial Statements (as defined below and which term as used in this Agreement includes the related notes thereto) filed with the Commission as a part of the Registration Statement and included in the Preliminary Prospectuses, the Time of Sale Prospectus and the U.S. Prospectus (each, an &#8220;<u>Applicable Prospectus</u>&#8221; and collectively, the &#8220;<u>Applicable Prospectuses</u>&#8221;), are independent public, certified public or chartered professional accountants as required by the Securities Act, the Exchange Act and applicable Canadian Securities Laws. There has not been any &#8220;reportable event&#8221; (as that term is defined in National Instrument 51-102 Continuous Disclosure Obligations of the Canadian Securities Administrators) with Manning Elliott LLP or any other prior auditor of the Company or any of its Material Subsidiaries. To the Company&#8217;s knowledge, after due and careful inquiry, Manning Elliott LLP is not in violation of the auditor independence requirements of the Sarbanes-Oxley Act of 2002.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak9d8a7950-c97e-47f4-b29f-edd40d29b09e" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">16</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(o) <u>Enforceability of Agreements</u>. All agreements between the Company and third parties expressly referenced in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses are legal, valid and binding obligations of the Company enforceable in accordance with their respective terms, except to the extent that (i) enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors&#8217; rights generally and by general equitable principles, and (ii) the indemnification provisions of certain agreements may be limited by Applicable Law or public policy considerations in respect thereof, and except for any other potentially unenforceable term that, individually or in the aggregate, would not reasonably be expected to be material to the Company. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(p) <u>Financial Information</u><b><i>.</i></b> The consolidated financial statements of the Company filed with the Commission as a part of the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, together with the related notes and schedules (the &#8220;<u>Financial Statements</u>&#8221;), present fairly, in all material respects, the consolidated financial position of the Company and the Material Subsidiaries as of the dates indicated and the consolidated statements of comprehensive income, shareholders&#8217; equity and cash flows of the Company for the periods specified. Such Financial Statements conform in all material respects with International Financial Reporting Standards as issued by the International Accounting Standards Board (&#8220;<u>IFRS</u>&#8221;), applied on a consistent basis during the periods involved. The other financial and statistical data with respect to the Company and the Material Subsidiaries contained or incorporated by reference in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, are accurately and fairly presented in all material respects and prepared on a basis consistent with the financial statements and books and records of the Company; there are no financial statements (historical or pro forma) that are required to be included or incorporated by reference in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses that are not included or incorporated by reference as required; the Company and the Material Subsidiaries do not have any material liabilities or obligations, direct or contingent (including any off-balance sheet obligations), not described in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses and all disclosures contained or incorporated by reference therein; and no other financial statements are required to be set forth or to be incorporated by reference in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(q) <u>Statistical, Industry-Related and Market-Related Data</u>. The statistical, industry-related and market-related data included in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, are based on or derived from sources that the Company reasonably believes are reliable and accurate.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak95c5af20-ac39-49a1-b40f-439aae6362d3" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">17</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(r) <u>Organization</u>. The Company and each of its Material Subsidiaries are, and will be, duly organized, validly existing as a corporation and in good standing (where such concept is recognized) under the laws of their respective jurisdictions of organization. The Company and each of the Material Subsidiaries are, and will be, duly licensed or qualified as a foreign corporation for transaction of business and in good standing under the laws of each other jurisdiction in which their respective ownership or lease of property or the conduct of their respective businesses requires such license or qualification, and have all corporate power and authority necessary to own or hold their respective properties and to conduct their respective businesses as described in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, except where the failure to be so qualified or in good standing or have such power or authority would not, individually or in the aggregate, have a material adverse effect or would reasonably be expected to have a material adverse effect on or affecting the assets, business, operations, earnings, properties, condition (financial or otherwise), shareholders&#8217; equity or results of operations of the Company and the Material Subsidiaries taken as a whole, or prevent or materially interfere with consummation of the transactions contemplated hereby (a &#8220;<u>Material Adverse Effect</u>&#8221;). </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(s) <u>Subsidiaries</u><u>.</u> The subsidiaries of the Company listed in <u>Schedule &#8220;A&#8221;</u> (individually a &#8220;<u>Material Subsidiary</u>&#8221; and collectively, the &#8220;<u>Material Subsidiaries</u>&#8221;), include all of the Company&#8217;s significant subsidiaries (as such term is defined in Rule 1-02 of Regulation S-X promulgated by the Commission). Except as set forth in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus, the Prospectuses, and with the exception that a portion of the share capital of each of the Company&#8217;s Mexican subsidiaries is held by a nominee for the benefit of the Company in order to comply with the laws of Mexico, the Company owns, directly or indirectly, all of the equity interests of the Material Subsidiaries free and clear of any lien, charge, security interest, encumbrance, right of first refusal or other restriction, and all the equity interests of the Material Subsidiaries are validly issued and are fully paid, non-assessable and free of preemptive and similar rights. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(t) <u>Minute Books</u>. Since January 1, 2017, all existing minute books of the Company and each of the Material Subsidiaries, including all existing records of all meetings and actions of the board of directors (including, the Audit, Compensation and Governance and Nominating Committees and other board committees) and securityholders of the Company (collectively, the &#8220;<u>Corporate Records</u>&#8221;) have been made available to the Underwriters and their counsel, and all such Corporate Records are complete in all material respects (except in respect of minutes for Board and Committee meetings since January 1, 2018 that are not yet available in draft form or otherwise, in which case agendas and handwritten notes of the business conducted at such meetings have been made available for review by the Underwriters). There are no transactions, agreements or other actions of the Company or any of the Material Subsidiaries that are required to be recorded in the Corporate Records that are not properly approved and/or recorded in the Corporate Records. All required filings have been made with the appropriate Governmental Authorities in the Province of British Columbia in a timely fashion under the<i> Business Corporations Act </i>(British Columbia), except for such filings where the failure to file would not have a Material Adverse Effect, either individually or in the aggregate.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak1664004b-9152-4ed7-b6f6-9a538042954b" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">18</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(u) <u>No Violation or Default</u>. Neither the Company nor any of the Material Subsidiaries is (i) in violation of its articles or similar organizational documents; (ii) except as are disclosed in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, in violation or default, and no event has occurred that, with notice or lapse of time or both, would constitute such a violation or default, in the due performance or observance of any term, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of the Material Subsidiaries is a party or by which the Company or any of the Material Subsidiaries is bound or to which any of the property or assets of the Company or any of the Material Subsidiaries are subject; or (iii) except as disclosed in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, in violation of any Applicable Law, except in the case of each of clauses (ii) and (iii) above, for any such violation or default that would not, individually or in the aggregate, have a Material Adverse Effect. To the Company&#8217;s knowledge, no other party under any material agreements, contracts, arrangements or understandings (written or oral) to which it or any of the Material Subsidiaries is a party is in violation or default in any respect thereunder where such violation or default would have a Material Adverse Effect.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(v) <u>Disclosure Controls</u>. The Company and each of the Material Subsidiaries (other than Material Subsidiaries acquired not more than 365 days prior to the Evaluation Date, as defined below) maintain systems of internal accounting controls applicable under IFRS in applicable periods, or sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management&#8217;s general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with IFRS and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management&#8217;s general or specific authorization; and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. Except as disclosed in the Company&#8217;s Form 20-F, the Company&#8217;s internal control over financial reporting is effective and the Company is not aware of any material weaknesses in its internal control over financial reporting. Since the date of the latest audited financial statements of the Company included or incorporated by reference in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, there has been no change in the Company&#8217;s internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company&#8217;s internal control over financial reporting. The Company has established disclosure controls and procedures (as defined in Exchange Act Rules 13a-15 and 15d-15) for the Company and designed such disclosure controls and procedures to ensure that material information relating to the Company and each of the Material Subsidiaries is made known to the certifying officers by others within those entities, particularly during the period in which the Company&#8217;s Annual Report on Form 20-F, or if applicable on Form 10-K, is being prepared or during the period in which financial statements will be filed or furnished with the Commission on Form 6-K. The Company&#8217;s certifying officers have evaluated the effectiveness of the Company&#8217;s controls and procedures as of a date within 90 days prior to the filing date of the Form 20-F, for the fiscal year most ended December 31, 2017 (such date, the <b>&#8220;</b><u>Evaluation Date</u>&#8221;). Since the Evaluation Date, the Company has taken steps to minimize the material weaknesses noted in the Form 20-Finternal controls (as such term is defined in Item 307(b) of Regulation S-K under the Securities Act) or, to the Company&#8217;s knowledge, in other factors that could significantly affect the Company&#8217;s internal controls, except that the Company has limited the scope of its disclosure controls and procedures and internal control over financial reporting for its quarter ended June 30, 2018 to exclude controls, policies and procedures of a business that the Company acquired not more than 365 days before the last day of the period covered by the interim filing.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreakb6ca0fd8-25a3-4870-a348-4279bcd9bd31" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">19</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(w) <u>Capitalization</u><b>.</b> The issued and outstanding common shares of the Company have been validly issued, are fully paid and non-assessable and are not subject to any preemptive rights, rights of first refusal or similar rights. The Company has an authorized, issued and outstanding capitalization as set forth in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses as of the dates referred to therein (other than the grant of additional options under the Company&#8217;s existing stock option plans, or changes in the number of outstanding Common Shares of the Company due to the issuance of shares upon the exercise or conversion of securities exercisable for, or convertible into, Common Shares outstanding on the date hereof) and such authorized capital stock conforms in all material respects to the description thereof set forth in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses. The description of the securities of the Company in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses is complete and accurate in all material respects. Except as disclosed in or contemplated by the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, as of the date referred to therein, the Company does not have outstanding any options to purchase, or any rights or warrants to subscribe for, or any securities or obligations convertible into, or exchangeable for, or any contracts or commitments to issue or sell, any Common Shares or other securities.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(x) <u>No Applicable Registration or Other Similar Rights</u><b><i>.</i></b> There are no persons with registration or other similar rights to have any equity or debt securities registered or qualified for sale under the Registration Statement or included in the offering contemplated by this Agreement who have not waived such rights in writing (including electronically) prior to the execution of this Agreement.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak5370e28a-4af0-4e63-99a3-1c6d96be362b" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">20</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(y) <u>No Consents Required</u><b><i>. </i></b>No consent, approval, authorization, order, registration or qualification of or with Governmental Authority is required for the execution, delivery and performance by the Company of this Agreement, the issuance and sale by the Company of the Public Securities, except for (i) the qualification of the Public Securities for distribution in the United States and in Canada by the filing with the British Columbia Securities Commission of the documents referred to in section 4 of BC 72-503; (ii) such consents, approvals, authorizations, orders and registrations or qualifications as may be required under applicable U.S. federal and state securities laws or by the bylaws and rules of FINRA or the Commission in connection with the sale of the Public Securities by the Underwriters; and (iii) the conditional acceptance of the Toronto Stock Exchange to the terms of the Offering. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(z) <u>No Preferential Rights</u><b><i>.</i></b> Except as set forth in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, (i) and except pursuant to options to purchase Common Shares pursuant to outstanding options, restricted stock units, warrants or convertible debentures, no person, as such term is defined in Rule 1-02 of Regulation S-X promulgated under the Securities Act (each, a &#8220;<u>Person</u>&#8221;), has the right, contractual or otherwise, to cause the Company to issue or sell to such Person any Common Shares or other securities of the Company, (ii) the Company has not granted to any Person any preemptive rights, resale rights, rights of first refusal, or any other rights (whether pursuant to a &#8220;poison pill&#8221; provision or otherwise) to purchase any Common Shares or other securities of the Company, (iii) no Person has the right to act as an underwriter or as a financial advisor to the Company in connection with the offer and sale of the Public Securities, and (iv) no Person has the right, contractual or otherwise, to require the Company to register under the Securities Act or qualify for distribution under Canadian Securities Laws any Common Shares or other securities of the Company, or to include any such Common Shares or other securities in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, whether as a result of the filing or effectiveness of the Registration Statement, the Prospectuses (or documents incorporated by reference therein) or the sale of the Public Securities as contemplated thereby or otherwise. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(aa) <u>Forward-Looking Information</u><b><i>.</i></b> No forward-looking statement (within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act and no forward-looking information within the meaning of Section 1(1) of the Ontario Securities Act) contained or incorporated by reference in the Registration Statement, the Prospectuses or the Time of Sale Prospectuses has been made or reaffirmed without a reasonable basis or has been disclosed other than in good faith. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(bb) <u>Certificates</u><b><i>.</i></b> The form of certificates representing the Public Securities, to the extent that physical certificates are issued for such securities, will be in due and proper form and conform to the requirements of the <i>Business Corporations Act </i>(British Columbia), the articles of incorporation of the Company and applicable requirements of Trading Markets or will have been otherwise approved by the Trading Markets, if required.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreakbc94de3e-10b4-427a-89fa-24063ed54807" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">21</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(cc) <u>Transfer Agent</u><b><i>.</i></b> Computershare Investor Services Inc. has been duly appointed as registrar and transfer agent for the Common Shares. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(dd) <u>No Litigation</u>. There are no legal, governmental or regulatory actions, suits or proceedings pending, nor, to the Company&#8217;s knowledge, any legal, governmental or regulatory audits or investigations, to which the Company or a Subsidiary is a party or to which any property of the Company or any of the Material Subsidiaries is the subject that, individually or in the aggregate, if determined adversely to the Company or any of the Material Subsidiaries, could reasonably be expected to have a Material Adverse Effect or materially and adversely affect the ability of the Company to perform its obligations under this Agreement; except as disclosed in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, to the Company&#8217;s knowledge, no such actions, suits or proceedings are threatened or contemplated by any Governmental Authority or threatened by others; and (i) there are no current or pending audits or investigations, actions, suits or proceedings by or before any Governmental Authority that are required under the Securities Act or Canadian Securities Laws to be described in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses that are not so described; and (ii) there are no agreements, contracts, arrangements or understandings (written or oral) or other documents that are required under the Securities Act to be filed as exhibits to the Registration Statement that are not so filed. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(ee) <u>Labor Disputes</u><b><i>. </i></b>No labor disturbance by or dispute with employees of the Company or any of the Material Subsidiaries exists or, to the knowledge of the Company, is threatened that could reasonably be expected to have a Material Adverse Effect.<b><i> </i></b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(ff) <u>Local Disputes</u><b><i>.</i></b> Except as set forth in the Registration Statement and the Prospectuses, no dispute between the Company and any local, native or indigenous group exists, or to the Company&#8217;s knowledge, is threatened or imminent with respect to any of the Company&#8217;s properties or exploration activities that could reasonably be expected to have a Material Adverse Effect.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(gg) <u>Proposed Acquisition</u>. Except as described in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, there are no material agreements, contracts, arrangements or understandings (written or oral) with any persons relating to the acquisition or proposed acquisition by the Company or its Material Subsidiaries of any material interest in any business (or part of a business) or corporation, nor are there any other specific contracts or agreements (written or oral) in respect of any such matters in contemplation. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak8be5c2fc-732f-4d74-a0e8-dd222acb2773" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">22</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(hh) <u>Intellectual Property Rights.</u> Except as disclosed in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, the Company and the Material Subsidiaries own, possess, license or have other rights to use all foreign and domestic patents, patent applications, trade and service marks, trade and service mark registrations, trade names, copyrights, licenses, inventions, trade secrets, technology, Internet domain names, know-how and other intellectual property (collectively, the &#8220;<u>Intellectual Property</u>&#8221;), necessary for the conduct of their respective businesses as now conducted except to the extent that the failure to own, possess, license or otherwise hold adequate rights to use such Intellectual Property would not, individually or in the aggregate, have a Material Adverse Effect. Except as disclosed in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses (a) there are no rights of third parties to any such Intellectual Property owned by the Company and the Material Subsidiaries; (b) to the Company&#8217;s knowledge, there is no infringement by third parties of any such Intellectual Property; (c) there is no pending or, to the Company&#8217;s knowledge, threatened action, suit, proceeding or claim by others challenging the Company&#8217;s and the Material Subsidiaries&#8217; rights in or to any such Intellectual Property, and the Company is unaware of any facts which could form a reasonable basis for any such action, suit, proceeding or claim; (d) there is no pending or, to the Company&#8217;s knowledge, threatened action, suit, proceeding or claim by others challenging the validity or scope of any such Intellectual Property; (e) there is no pending or, to the Company&#8217;s knowledge, threatened action, suit, proceeding or claim by others that the Company and the Material Subsidiaries infringe or otherwise violate any patent, trademark, copyright, trade secret or other proprietary rights of others; (f) to the Company&#8217;s knowledge, there is no third-party U.S. patent or published U.S. patent application which contains claims for which an Interference Proceeding (as defined in 35 U.S.C. &#167; 135) has been commenced against any patent or patent application described in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, as being owned by or licensed to the Company; and (g) the Company and the Material Subsidiaries have complied with the terms of each agreement pursuant to which Intellectual Property has been licensed to the Company or such Material Subsidiary, and all such agreements are in full force and effect, except, in the case of any of clauses (a)-(g) above, for any such infringement by third parties or any such pending or threatened suit, action, proceeding or claim as would not, individually or in the aggregate, result in a Material Adverse Effect.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(ii) <u>Market Capitalization.</u> At the time the Registration Statement was originally declared effective, and at the time the Company&#8217;s most recent Annual Report on Form 20-F was filed with the Commission, the Company met the then applicable requirements for the use of Form F-3 under the Securities Act.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(jj) <u>No Material Defaults</u><b><i>.</i></b> Neither the Company nor any of the Material Subsidiaries has defaulted on any installment on indebtedness for borrowed money or on any rental on one or more long-term leases, which defaults, individually or in the aggregate, would have a Material Adverse Effect. The Company has not filed a report pursuant to Section 13(a) or 15(d) of the Exchange Act since the filing of its last Annual Report on Form 20-F, indicating that it (i) has failed to pay any dividend or sinking fund installment on preferred stock or (ii) has defaulted on any installment on indebtedness for borrowed money or on any rental on one or more long-term leases, which defaults, individually or in the aggregate, would have a Material Adverse Effect.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak4a04a6bd-4c68-4ce7-b9ff-f7c9e2de001b" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">23</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(kk) <u>Certain Market Activities</u>. Neither the Company, nor any of the Material Subsidiaries, nor to the knowledge of the Company any of their respective directors or officers has taken, directly or indirectly, any action designed, or that has constituted or might reasonably be expected to cause or result in, under the Exchange Act, Canadian Securities Laws or otherwise, the stabilization, maintenance or manipulation of the price of any security of the Company to facilitate the sale or resale of the Public Securities. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(ll) <u>Title to Real and Personal Property</u>. Except as set forth in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, the Company and the Material Subsidiaries have good and marketable title in fee simple to all items of real property owned by them, good and valid title to all personal property described in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses as being owned by them that are material to the businesses of the Company or such Material Subsidiary, in each case free and clear of all liens, encumbrances and claims, except those that (i) do not materially interfere with the use made and proposed to be made of such property by the Company and any of the Material Subsidiaries or (ii) would not, individually or in the aggregate, have a Material Adverse Effect. Any real or personal property described in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses as being leased by the Company and any of the Material Subsidiaries is held by them under valid, existing and enforceable leases, except those that (A) do not materially interfere with the use made or proposed to be made of such property by the Company or any of the Material Subsidiaries or (B) would not, individually or in the aggregate, have a Material Adverse Effect. Each of the properties of the Company and the Material Subsidiaries complies with all applicable codes and Applicable Laws (including, without limitation, building and zoning codes, laws and regulations and laws relating to access to such properties), except if and to the extent disclosed in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses or except for such failures to comply that would not, individually or in the aggregate, interfere in any material respect with the use made and proposed to be made of such property by the Company and the Material Subsidiaries or otherwise have a Material Adverse Effect. None of the Company or the Material Subsidiaries has received from any Governmental Authorities any notice of any condemnation of, or zoning change affecting, the properties of the Company and the Material Subsidiaries, and the Company knows of no such condemnation or zoning change which is threatened, except for such that would not interfere in any material respect with the use made and proposed to be made of such property by the Company and the Material Subsidiaries or otherwise have a Material Adverse Effect, individually or in the aggregate.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreake2a5e304-9094-43de-8c92-2bc9e6274332" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">24</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(mm) <u>Mining Rights</u><b><i>.</i></b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 0.5in" align="justify">(i) <b><i></i></b>The Avino mine, San Gonzalo mine and Bralorne Gold mine, each as described in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses (collectively, the &#8220;<u>Material Properties</u>&#8221;) are the only resource properties currently material to the Company in which the Company or the Material Subsidiaries have an interest; the Company or through the Material Subsidiaries, hold either freehold title, mining leases, mining concessions, mining claims, exploration permits, prospecting permits or participant interests or other conventional property or proprietary interests or rights, recognized in the jurisdiction in which the Material Properties are located, in respect of the ore bodies and minerals located on the Material Properties in which the Company (through the applicable Material Subsidiary) has an interest under valid, subsisting and enforceable title documents or other recognized and enforceable agreements, contracts, arrangements or understandings, sufficient to permit the Company (through the applicable Material Subsidiary) to explore for and exploit the minerals relating thereto; all leases or claims and permits relating to the Material Properties in which the Company (through the applicable Material Subsidiary) has an interest or right have been validly located and recorded in accordance with all Applicable Laws and are valid and subsisting; except as disclosed in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, the Company (through the applicable Material Subsidiary) has all necessary surface rights, access rights and other necessary rights and interests relating to the Material Property in which the Company (through the applicable Material Subsidiary) has an interest granting the Company (through the applicable Material Subsidiary) the right and ability to explore for and exploit minerals, ore and metals for development and production purposes as are appropriate in view of the rights and interest therein of the Company or the applicable Material Subsidiary, with only such exceptions as do not materially interfere with the current use made by the Company or the applicable Material Subsidiary of the rights or interest so held, and each of the proprietary interests or rights and each of the agreements, contracts, arrangements or understandings and obligations relating thereto referred to above is currently in good standing in all respects in the name of the Company or the applicable Material Subsidiary; except as disclosed in the Prospectuses, the Company and the Material Subsidiaries do not have any responsibility or obligation to pay any commission, royalty, license, fee or similar payment to any person with respect to the property rights thereof, except where such fee or payment would not have a Material Adverse Effect, either individually<b><i> </i></b>or in the aggregate;</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 0.5in" align="justify">(ii) the Company or the applicable Material Subsidiary holds direct interests in the Material Properties, as described in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses (the &#8220;<u>Project Rights</u>&#8221;), under valid, subsisting and enforceable agreements or instruments, and all such agreements and instruments in connection with the Project Rights are valid and subsisting and enforceable in accordance with their terms;</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreaka645c771-7f6e-4e6c-9008-7a1e09647b0f" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">25</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 0.5in" align="justify">(iii) the Company and the Material Subsidiaries have identified all the material permits, certificates, and approvals (collectively, the &#8220;<u>Permits</u>&#8221;) which are or will be required for the exploration, development and eventual or actual operation of the Material Properties, which Permits include but are not limited to environmental assessment certificates, water licenses, land tenures, rezoning or zoning variances and other necessary local, provincial, state and federal approvals; and, except as disclosed in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, the appropriate Permits have either been received, applied for, or the processes to obtain such Permits have been or will in due course be initiated by the Company or the applicable Material Subsidiaries; and, except as disclosed in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, neither the Company nor the applicable Material Subsidiaries know of any issue or reason why the Permits should not be approved and obtained in the ordinary course;</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 0.5in" align="justify">(iv) all assessments or other work required to be performed in relation to the material mining claims and the mining rights of the Company and the applicable Material Subsidiary in order to maintain their respective interests therein, if any, have been performed to date and, except as disclosed in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, the Company and the applicable Material Subsidiary have complied in all material respects with all Applicable Laws in this regard as well as with regard to legal and contractual obligations to third parties in this regard except in respect of mining claims and mining rights that the Company and the applicable Material Subsidiary intend to abandon or relinquish and except for any non-compliance which would not either individually or in the aggregate have a Material Adverse Effect; all such mining claims and mining rights are in good standing in all respects as of the date of this Agreement;</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 0.5in" align="justify">(v) except as disclosed in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, all mining operations on the properties of the Company and the Material Subsidiaries (including, without limitation, the Material Properties) have been conducted in all respects in accordance with good mining and engineering practices and all applicable workers&#8217; compensation and health and safety and workplace<b><i> </i></b>laws, regulations and policies have been duly complied with; </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 0.5in" align="justify">(vi) except as disclosed in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, there are no environmental audits, evaluations, assessments, studies or tests relating to the Company or the Material Subsidiaries except for ongoing assessments conducted by or on behalf of the Company and the Material Subsidiaries in the ordinary course; </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak68f5ace7-e0b4-48c5-8d2f-7fab7f7a162c" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">26</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 0.5in" align="justify">(vii) the Company made available to the respective authors thereof prior to the issuance of all of the applicable technical reports filed by the Company on SEDAR relating to the Material Properties (the &#8220;<u>Reports</u>&#8221;), for the purpose of preparing the Reports, as applicable, all information requested, and no such information contained any material misrepresentation as at the relevant time the relevant information was made available;</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 0.5in" align="justify">(viii) the Reports complied in all material respects with the requirements of NI 43-101 &#8211; <i>Standards of Disclosure for Mineral Projects </i>(&#8220;<u>NI 43-101</u>&#8221;) as at the date of each such Report; </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 0.5in" align="justify">(ix) the Company is in compliance, in all material respects, with the provisions of NI 43-101 and has filed all technical reports required thereby and, at the time of filing, all such reports complied, in all material respects, with the requirements of NI 43-101; except as noted in the Prospectuses, all scientific and technical information disclosed in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses: (i) is based upon information prepared, reviewed and/or verified by or under the supervision of a &#8220;qualified person&#8221; (as such term is defined in NI 43-101), (ii) has been prepared and disclosed in accordance with Canadian industry standards set forth in NI 43- 101, and (iii) was true, complete and accurate in all material respects at the time of filing; and </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 0.5in" align="justify">(x) the title reports and corporate opinions with respect to the Material Properties listed on <u>Schedule B</u> attached hereto (the &#8220;<u>Title and Corporate Opinions</u>&#8221;), copies of which have been provided to the Representative, are to the knowledge of the Company, correct and complete in all respects with respect to all material operations on the Material Properties on the date hereof, except as in respect of matters or concessions which are not material. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(nn) <u>Taxes</u><b><i>.</i></b><b> </b>The Company and each of the Material Subsidiaries have filed all federal, state, provincial, local and foreign tax returns which have been required to be filed and paid all taxes shown thereon through the date hereof, to the extent that such taxes have become due and are not being contested in good faith, except where the failure to so file or pay would not have a Material Adverse Effect. Except as otherwise disclosed in or contemplated by the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, no tax deficiency has been determined adversely to the Company or any of the Material Subsidiaries which has had, individually or in the aggregate, a Material Adverse Effect. The Company has no knowledge of any federal, state, provincial or other governmental tax deficiency, penalty or assessment which has been or might be asserted or threatened against it which would have a Material<b><i> </i></b>Adverse Effect.<b><i></i></b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(oo) <u>No Reliance</u><b><i>.</i></b> The Company has not relied upon the Underwriters or legal counsel for the Underwriters for any legal, tax or accounting advice in connection with the offering and sale of the Public Securities. <b><i></i></b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreakc1dc926f-4fab-4bae-bf36-da01d9c363f8" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">27</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(pp) <u>Investment Company Act</u>. Neither the Company nor any of the Material Subsidiaries is or, after giving effect to the offering and sale of the Public Securities and the application of the proceeds thereof as described in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, will be an &#8220;investment company&#8221; or an entity &#8220;controlled&#8221; by an &#8220;investment company,&#8221; as such terms are defined in the Investment Company Act of 1940, as amended.<b><i></i></b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(qq) <u>ERISA</u>. The Company does not have a material employee benefit plan, within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended.<b><i></i></b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(rr) <u>Company is not a &#8220;Controlled Foreign Corporation&#8221;.</u><b><i> </i></b>As of the date hereof, the Company is not a &#8220;<i>controlled foreign corporation</i>,&#8221; as such term is defined in the Internal Revenue Code of 1986, as amended (the &#8220;<u>Code</u>&#8221;), and does not expect to become a controlled foreign corporation in the foreseeable future. <b><i></i></b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(ss) <u>Insurance.</u> The Company and each of the Material Subsidiaries carry, or are covered by, insurance in such amounts and covering such risks as the Company and each of the Material Subsidiaries reasonably believe are adequate for the conduct of their properties and as is customary for companies engaged in similar businesses in similar industries.<b><i></i></b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(tt) <u>No Price Stabilization or Manipulation; Compliance with Regulation M.</u> The Company has not taken, nor will the Company take, directly or indirectly, any action designed to or that might be reasonably expected to cause or result in stabilization or manipulation of the price of the Common Shares, as applicable, or any other &#8220;reference security&#8221; (as defined in Rule 100 of Regulation M under the Exchange Act (&#8220;<u>Regulation M</u>&#8221;)) whether to facilitate the sale or resale of the Public Securities, as applicable, or otherwise, and has taken no action which would directly or indirectly violate Regulation M.<b><i></i></b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(uu) <u>Working Capital</u>. To the Company&#8217;s knowledge and taking into account the available working capital and the net proceeds receivable by the Company following the sale of the Public Securities, the Company has sufficient working capital for its present requirements that is for a period of at least 12 months from the date of the Prospectus. <b><i></i></b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(vv) <u>FINRA Matters</u>. All of the information provided to the Underwriters or to counsel for the Underwriters by the Company and, to the knowledge of the Company, its officers and directors and the holders of any securities (debt or equity) or options to acquire any securities of the Company in connection with letters, filings or other supplemental information provided to FINRA pursuant to FINRA Conduct Rule 5110, 5121 or 5190 is true, complete and correct in all material aspects.<b><i></i></b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak09fbd7ae-b218-4ea7-a0b0-b40887cbf76d" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">28</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(ww) <u>Environmental Laws</u><b>.</b> Except as set forth in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses:<b><i></i></b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 0.5in" align="justify">(i) each of the Company and the Material Subsidiaries is in compliance in all material respects with all applicable federal, provincial, state, municipal and local laws, statutes, ordinances, bylaws and regulations and orders, directives and decisions rendered by any ministry, department or administrative or regulatory agency, domestic or foreign (the &#8220;<u>Environmental Laws</u>&#8221;) relating to the protection of the environment, occupational health and safety or the processing, use, treatment, storage, disposal, discharge, transport or handling of any pollutants, contaminants, chemicals or industrial, toxic or hazardous wastes or substance, including any uranium or derivatives thereof (the &#8220;<u>Hazardous Substances</u>&#8221;), except where such non-compliance would not have a Material Adverse Effect, either individually or in the aggregate;</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 0.5in" align="justify">(ii) each of the Company and the Material Subsidiaries has obtained all licenses, permits, approvals, consents, certificates, registrations and other authorizations under all applicable Environmental Laws (the &#8220;<u>Environmental Permits</u>&#8221;) necessary as at the date hereof for the operation of the businesses carried on or proposed to be commenced by the Company and the Material Subsidiaries and each Environmental Permit is valid, subsisting and in good standing and to the knowledge of the Company neither the Company nor the Material Subsidiaries is in default or breach of any Environmental Permit which would have a Material Adverse Effect, and no proceeding is pending or, to the knowledge of the Company or the Material Subsidiaries, threatened, to revoke or limit any Environmental Permit; </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 0.5in" align="justify">(iii) neither the Company nor the Material Subsidiaries has used, except in compliance with all Environmental Laws and Environmental Permits, and other than as may be incidental to mineral resource exploration, development, mining, recovery, processing or milling, any property or facility which it owns or leases or previously owned or leased, to generate, manufacture, process, distribute, use, treat, store, dispose of, transport or handle any Hazardous Substance; and</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 0.5in" align="justify">(iv) neither the Company nor the Material Subsidiaries (including, if applicable, any predecessor companies) has received any notice of, or been prosecuted for an offence alleging, non-compliance with any Environmental Law that would have a Material Adverse Effect, and neither the Company nor the Material Subsidiaries (including, if applicable, any predecessor companies) has settled any allegation of non-compliance that would have a Material Adverse Effect short of prosecution. There are no orders or directions relating to environmental matters requiring any material work, repairs, construction or capital expenditures to be made with respect to any of the assets of the Company or the Material Subsidiaries, nor has the Company or the Material Subsidiaries received notice of any of the same; and (v) neither the Company nor the Material Subsidiaries has received any notice wherein it is alleged or stated that the Company or the Material Subsidiaries is potentially responsible for a federal, provincial, state, municipal or local clean-up site or corrective action under any Environmental Laws. Neither the Company nor the Material Subsidiaries has received any request for information in connection with any federal, state, municipal or local inquiries as to disposal sites.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak8654d7d4-7dcb-41ea-9555-da7ec65623bb" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">29</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(xx) <u>Finder&#8217;s Fee&#8217;s.</u><b><i> </i></b>Neither the Company nor any of the Material Subsidiaries has incurred any liability for any finder&#8217;s fees, brokerage commissions or similar payments in connection with the transactions herein contemplated, except as may otherwise exist with respect to the Underwriters pursuant<b><i> </i></b>to this Agreement.<b><i></i></b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(yy) <u>Broker/Dealer Relationships</u>. Neither the Company nor any of the Material Subsidiaries or any related entities (i) is required to register as a &#8220;broker&#8221; or &#8220;dealer&#8221; in accordance with the provisions of the Exchange Act or (ii) directly or indirectly through one or more intermediaries, controls or is a &#8220;person associated with a member&#8221; or &#8220;associated person of a member&#8221; (within the meaning set forth in the FINRA Manual).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(zz) <u>Dividend Restrictions</u>. Except as may be restricted by Applicable Law, no Material Subsidiary is prohibited or restricted, directly or indirectly, from paying dividends to the Company, or from making any other distribution with respect to such Material Subsidiaries&#8217; equity securities or from repaying to the Company or any other Material Subsidiaries any amounts that may from time to time become due under any loans or advances to such Material Subsidiaries from the Company or from transferring any property or assets to the Company or to any other Material Subsidiaries. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(aaa) <u>No Improper Practices</u><b><i>. </i></b>(i) Neither the Company nor, to the Company&#8217;s knowledge, the Material Subsidiaries, nor to the Company&#8217;s knowledge, any of their respective directors or officers has, in the past five years, made any unlawful contributions to any candidate for any political office (or failed fully to disclose any contribution in violation of Applicable Law) or made any contribution or other payment to any official of, or candidate for, any federal, state, provincial, municipal, or foreign office or other person charged with similar public or quasi-public duty in violation of any Applicable Law or of the character required to be disclosed in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses; (ii) no relationship, direct or indirect, exists between or among the Company or, to the Company&#8217;s knowledge, any Material Subsidiary or any affiliate of any of them, on the one hand, and the directors, officers and shareholders of the Company or, to the Company&#8217;s knowledge, any Material Subsidiary, on the other hand, that is required by the Securities Act or Canadian Securities Laws to be described in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses that is not so described; (iii) no relationship, direct or indirect, exists between or among the Company or any Material Subsidiary or any affiliate of them, on the one hand, and the directors, officers, or shareholders of the Company or, to the Company&#8217;s knowledge, any Material Subsidiary, on the other hand, that is required by the rules of FINRA (or Canadian equivalent thereof) to be described in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses that is not so described; (iv) except as described in the Prospectuses, there are no material outstanding loans or advances or material guarantees of indebtedness by the Company or, to the Company&#8217;s knowledge, any Material Subsidiary to or for the benefit of any of their respective officers or directors or any of the members of the families of any of them; and (v) the Company has not offered, or caused any placement agent to offer, Common Shares or to make any payment of funds to any person with the intent to influence unlawfully (A) a customer or supplier of the Company or any Material Subsidiary to alter the customer&#8217;s or supplier&#8217;s level or type of business with the Company or any Material Subsidiary or (B) a trade journalist or publication to write or publish favorable information about the Company or any Material Subsidiary or any of their respective products or services, and, (vi) neither the Company nor any Material Subsidiary nor, to the Company&#8217;s knowledge, any director, officer, employee or agent of the Company or any Material Subsidiary has made any payment of funds of the Company or any Material Subsidiary or received or retained any funds in violation of any Applicable Law (including, without limitation, the Foreign Corrupt Practices Act of 1977 and the <i>Corruption of Foreign Public Officials Act </i>(Canada)).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreakf5374596-dcc2-46e9-9234-c2a5cd1de218" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">30</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(bbb) <u>Operations.</u> The operations of the Company and the Material Subsidiaries are and have been conducted at all times in compliance with applicable financial record keeping and reporting requirements of the <i>Proceeds of Crime (Money Laundering) and Terrorist Financing Act </i>(Canada), the <i>Corruption of Foreign Public Officials Act </i>(Canada) and applicable rules and regulations thereunder, and the money laundering statutes of all applicable jurisdictions, the rules and regulations thereunder and any related or similar applicable rules, regulations or guidelines, issued, administered or enforced by any Governmental Authority (collectively, the &#8220;<u>Money Laundering Laws</u>&#8221;); and no action, suit or proceeding by or before any court or Governmental Authority involving the Company or any of the Material Subsidiaries with respect to the Money Laundering Laws is pending or, to the knowledge of the Company, threatened. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(ccc) <u>Sanctions.</u><b><i> </i></b>(i) The Company represents that, neither the Company nor any of the Material Subsidiaries (collectively, the &#8220;<u>Entity</u>&#8221;) nor, to the Company&#8217;s knowledge, any director, officer, employee, agent, affiliate or representative of the Company, is a government, individual, or entity (in this paragraph (bbb), &#8220;<u>Member</u>&#8221;) that is, or is owned or controlled by a Member that is:</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 0in" align="justify">the subject of any sanctions administered or enforced by the U.S. Department of Treasury&#8217;s Office of Foreign Assets Control, the United Nations Security Council, the European Union, Her Majesty&#8217;s Treasury, the Office of the Superintendent of Financial Institutions (Canada), or pursuant to the <i>Special Economic Measures Act </i>(Canada) or other relevant sanctions authority or Applicable Law (collectively, &#8220;<u>Sanctions</u>&#8221;), nor</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 0in" align="justify">located, organized or resident in a country or territory that is the subject of Sanctions (including, without limitation, Burma/Myanmar, Cuba, Iran, Libya, North Korea, Russia, Sudan, Syria, Ukraine and Zimbabwe).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 0.5in" align="justify">(ii) The Company represents and covenants that it will not, directly or indirectly, use the proceeds of the offering, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other Member:</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 180px" align="justify">to fund or facilitate any activities or business of or with any Member or in any country or territory that, at the time of such funding or facilitation, is the subject of Sanctions; or</p> <p style="MARGIN: 0px 0px 0px 180px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 180px" align="justify">in any other manner that will result in a violation of Sanctions by any Member (including any Member participating in the offering, whether as underwriter, advisor, investor or otherwise).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreakf536705d-b984-43db-b4df-0dfd839f10cd" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">31</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 0.5in" align="justify">(iii) The Company represents and covenants that, except as detailed in the Registration Statement or included or incorporated by reference in the Preliminary Prospectuses, the Time of Sale Prospectus and the Prospectuses, for the past 5 years, it has not knowingly engaged in, is not now knowingly engaged in, and will not engage in, any dealings or transactions with any Member, or in any country or territory, that at the time of the dealing or transaction is or was the subject of Sanctions.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(ddd) <u>Certification of Disclosure</u>. There has been no failure on the part of the Company or any of the Company&#8217;s directors or officers, in their capacities as such, to comply in all material respects with any applicable provisions of the Sarbanes-Oxley Act, National Instrument 52-109 (<i>Certification of Disclosure in Issuers&#8217; Annual and Interim Filings</i>) (&#8220;<u>NI 52-109</u>&#8221;) and the rules and regulations promulgated thereunder. Each of the principal executive officer and the principal financial officer of the Company (or each former principal executive officer of the Company and each former principal financial officer of the Company as applicable) and each certifying officer of the Company (or each former certifying officer of the Company and each former certifying officer of the Company as applicable) has made all certifications required by Sections 302 and 906 of the Sarbanes-Oxley Act with respect to all reports, schedules, forms, statements and other documents required to be filed by it or furnished by it to the Commission and as required to be made and filed by NI 52-109. For purposes of the preceding sentence, &#8220;principal executive officer&#8221; and &#8220;principal financial officer&#8221; shall have the meanings given to such terms in the Sarbanes-Oxley Act and &#8220;certifying officer&#8221; shall have the meanings given to such term in NI 52-109.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(eee) <u>Passive Foreign Investment Company</u>. The Company believes that it was not a Passive Foreign Investment Company (&#8220;<u>PFIC</u>&#8221;) within the meaning of Section 1297 of the Code, during the prior tax year ended on December 31, 2017, and based on current business plans and financial expectations, the Company expects that it will not be a PFIC for the current tax year and expects that it will not be a PFIC for the foreseeable future. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(fff) <u>U.S. Real Property Holding Corporation</u>. The Company is not and has never been a U.S. real property holding corporation within the meaning of Section 897 of the Internal Revenue Code of 1986, as amended, and the Company shall so certify upon the Representative&#8217;s request.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak995364c9-73fa-4722-ac09-0aa09f09d588" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">32</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(ggg) <u>Bank Holding Company Act</u>. Neither the Company nor any of its Subsidiaries or Affiliates is subject to the Bank Holding Company Act of 1956, as amended (the &#8220;<u>BHCA</u>&#8221;) and to regulation by the Board of Governors of the Federal Reserve System (the &#8220;<u>Federal Reserve</u>&#8221;). Neither the Company nor any of its Subsidiaries or Affiliates owns or controls, directly or indirectly, five percent (5%) or more of the outstanding shares of any class of voting securities or twenty-five percent (25%) or more of the total equity of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve. Neither the Company nor any of its Subsidiaries or Affiliates exercises a controlling influence over the management or policies of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(hhh) <u>D&amp;O Questionnaires</u>. To the Company&#8217;s knowledge, all information contained in the questionnaires completed by each of the Company&#8217;s directors and officers immediately prior to the Offering as well as in the Lock-Up Agreement provided to the Underwriters is true and correct in all respects and the Company has not become aware of any information which would cause the information disclosed in such questionnaires become inaccurate and incorrect.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(iii) <u>Board of Directors</u>. The Board of Directors is comprised of the persons set forth under the heading of the Prospectus captioned &#8220;Management.&#8221; The qualifications of the persons serving as board members and the overall composition of the Board of Directors comply with the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder applicable to the Company and the rules of the Trading Markets. At least one member of the Board of Directors qualifies as a &#8220;financial expert&#8221; as such term is defined under the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder and the rules of the Trading Markets. In addition, at least a majority of the persons serving on the Board of Directors qualify as &#8220;independent&#8221; as defined under the rules of the Trading Markets.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 0.5in" align="justify">In this Agreement, a reference to &#8220;<i>knowledge</i>&#8221; of the Company means the knowledge of the President &amp; Chief Executive Officer, David Wolfin, the Chief Financial Officer, Malcolm Davidson, Carlos Rodriguez, Chief Operating Officer, Dorothy Chin, Secretary, and Jasman Yee, a director and qualified person for the Avino Mine, in each case, after reasonable inquiry within the scope of such person&#8217;s duties.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 0.5in" align="justify">Any certificate signed by any officer on behalf of the Company or any of the Material Subsidiaries and delivered to the Underwriters or counsel for the Underwriters in connection with the offering of the Public Securities shall be deemed to be a representation and warranty by the Company or Material Subsidiaries, as the case may be, as to matters covered thereby, to each Underwriter.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 0.5in" align="justify">The Company acknowledges that the Underwriters and, for purposes of the opinions to be delivered pursuant to this Agreement, counsel to the Company and counsel to the Underwriters will rely upon the accuracy and truthfulness of the foregoing representations and hereby consents to such reliance.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak859f12e1-af10-4eed-a0cc-c5042edf5acf" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">33</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0in" align="center"><b>ARTICLE IV.</b></p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0in" align="center"><b>OTHER AGREEMENTS OF THE PARTIES</b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">4.1 <u>Delivery of Registration Statement</u>. The Company has delivered, or will as promptly as practicable deliver, to the Underwriters complete conformed copies of the Registration Statement and of each consent and certificate of experts, as applicable, filed as a part thereof, and conformed copies of the Registration Statement (without exhibits), the Prospectus and the Prospectus Supplement, as amended or supplemented, in such quantities and at such places as an Underwriter reasonably requests. Neither the Company nor any of its directors and officers has distributed and none of them will distribute, prior to the Closing Date, any offering material in connection with the offering and sale of the Public Securities other than the Prospectus, the Prospectus Supplement, the Registration Statement, and copies of the documents incorporated by reference therein. The Company shall not file any such amendment or supplement to which the Representative shall reasonably object in writing.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">4.2 <u>Federal Securities Laws</u>.</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0.5in">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(a) <u>Compliance</u>. During the time when a Prospectus is required to be delivered under the Securities Act, the Company will use its commercially reasonable efforts to comply with all requirements imposed upon it by the Securities Act and the rules and regulations thereunder and the Exchange Act and the rules and regulations thereunder, as from time to time in force, so far as necessary to permit the continuance of sales of or dealings in the Public Securities in accordance with the provisions hereof and the Prospectus. If at any time when a Prospectus relating to the Public Securities is required to be delivered under the Securities Act, any event shall have occurred as a result of which, in the opinion of counsel for the Company or counsel for the Underwriters, the Prospectus, as then amended or supplemented, includes an untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, or if it is necessary at any time to amend the Prospectus to comply with the Securities Act, the Company will notify the Underwriters promptly and prepare and file with the Commission, subject to Section 4.1 hereof, an appropriate amendment or supplement in accordance with Section 10 of the Securities Act.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(b) <u>Filing of Final Prospectus Supplement</u>. The Company will file the Prospectus Supplement (in form and substance satisfactory to the Representative) with the Commission pursuant to the requirements of Rule 424.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(c) <u>Exchange Act Registration</u>. For a period of two years from the Execution Date, the Company will use its commercially reasonable efforts to maintain the registration of the Common Shares under the Exchange Act. The Company will not deregister the Common Shares under the Exchange Act without the prior written consent of the Representative.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(d) <u>Free Writing Prospectuses</u>. The Company represents and agrees that it has not made and will not make any offer relating to the Public Securities that would constitute an issuer free writing prospectus, as defined in Rule 433 of the rules and regulations under the Securities Act, without the prior written consent of the Representative. Any such free writing prospectus consented to by the Representative is herein referred to as a <b>&#8220;</b><u>Permitted Free Writing Prospectus</u>.&#8221; The Company represents that it will treat each Permitted Free Writing Prospectus as an &#8220;issuer free writing prospectus&#8221; as defined in rule and regulations under the Securities Act, and has complied and will comply with the applicable requirements of Rule 433 of the Securities Act, including timely Commission filing where required, legending and record keeping.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak5b9f8ed3-938f-4b26-a8fd-86de84b8c9f4" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">34</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">4.3 <u>Delivery to the Underwriters of Prospectuses</u>. The Company will deliver to the Underwriters, without charge, from time to time during the period when the Prospectus is required to be delivered under the Securities Act or the Exchange Act such number of copies of each Prospectus as the Underwriters may reasonably request and, as soon as the Registration Statement or any amendment or supplement thereto becomes effective, deliver to you two original executed Registration Statements, including exhibits, and all post-effective amendments thereto and copies of all exhibits filed therewith or incorporated therein by reference and all original executed consents of certified experts.</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">4.4 <u>Effectiveness and Events Requiring Notice to the Underwriters</u>. The Company will use its commercially reasonable efforts to cause the Registration Statement to remain effective with a current prospectus until the later of nine (9) months from the Execution Date and the date on which the Warrants are no longer outstanding, and will notify the Underwriters and holders of the Warrants immediately and confirm the notice in writing: (i) of the effectiveness of the Registration Statement and any amendment thereto; (ii) of the issuance by the Commission of any stop order or of the initiation, or the threatening, of any proceeding for that purpose; (iii) of the issuance by any state securities commission of any proceedings for the suspension of the qualification of the Public Securities for offering or sale in any jurisdiction or of the initiation, or the threatening, of any proceeding for that purpose; (iv) of the mailing and delivery to the Commission for filing of any amendment or supplement to the Registration Statement or Prospectus; (v) of the receipt of any comments or request for any additional information from the Commission; and (vi) of the happening of any event during the period described in this Section 4.4 that, in the judgment of the Company, makes any statement of a material fact made in the Registration Statement or the Prospectus untrue or that requires the making of any changes in the Registration Statement or the Prospectus in order to make the statements therein, in light of the circumstances under which they were made, not misleading. If the Commission or any state securities commission shall enter a stop order or suspend such qualification at any time, the Company will make every reasonable effort to obtain promptly the lifting of such order.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">4.5 <u>Review of Financial Statements</u>. For a period of three (3) years from the Execution Date, the Company, at its expense, shall cause its regularly engaged independent registered public accountants to review (but not audit) the Company&#8217;s financial statements for each of the first three fiscal quarters prior to the announcement of quarterly financial information.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak67af95d1-5ac5-429a-ba38-422dbba2f8a0" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">35</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">4.6 <u>Expenses of the Offering</u>.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(a) <u>General Expenses Related to the Offering</u>. The Company hereby agrees to pay on each of the Closing Date and each Option Closing Date, if any, to the extent not paid at the Closing Date, all expenses incident to the performance of the obligations of the Company under this Agreement, including, but not limited to: (a) all filing fees and communication expenses relating to the registration of the Public Securities to be sold in the Offering (including the Option Securities) with the Commission; (b) all FINRA Public Offering Filing System fees associated with the review of the Offering by FINRA; all fees and expenses relating to the listing of such Closing Shares, Option Shares and Warrant Shares on the Trading Markets and such other stock exchanges as the Company and the Representative together determine; (c) all fees, expenses and disbursements relating to the registration or qualification of such Public Securities under the &#8220;blue sky&#8221; securities laws of such states and other foreign jurisdictions as the Representative may reasonably designate (including, without limitation, all filing and registration fees, and the fees and expenses of Blue Sky counsel); (d) the costs of all mailing and printing of the underwriting documents (including, without limitation, the Underwriting Agreement, any Blue Sky Surveys and, if appropriate, any Agreement Among Underwriters, Underwriters&#8217; Questionnaire and Power of Attorney), Registration Statements, Prospectuses and all amendments, supplements and exhibits thereto and as many preliminary and final Prospectuses as the Representative may reasonably deem necessary; (e) the costs and expenses of the Company&#8217;s public relations firm; (f) the costs of preparing, printing and delivering the Public Securities; (g) fees and expenses of the Transfer Agent for the Public Securities (including, without limitation, any fees required for same-day processing of any instruction letter delivered by the Company); (h) stock transfer and/or stamp taxes, if any, payable upon the transfer of securities from the Company to the Underwriters; (i) the fees and expenses of the Company&#8217;s accountants; (j) the fees and expenses of the Company&#8217;s legal counsel and other agents and representatives; (k) the Underwriters&#8217; reasonable costs of mailing prospectuses to prospective investors; (l) the costs associated with advertising the Offering in the national editions of the Wall Street Journal and New York Times after the Closing Date; (n) all fees, expenses and disbursements relating to background checks of the Company&#8217;s officers and directors; (o) reasonable costs associated with bound volumes of the public offering materials as well as commemorative mementos and lucite tombstones, each of which the Company or its designee will provide within a reasonable time after the Closing in such quantities as the Underwriters may reasonably request; (p) the Underwriters&#8217; use of i-Deal&#8217;s book-building, prospectus tracking and compliance software (or other similar software) for the Offering; and (q) Underwriters&#8217; actual &#8220;road show&#8221; expenses for the Offering. The Underwriters may also deduct from the net proceeds of the Offering payable to the Company on the Closing Date, or each Option Closing Date, if any, the expenses set forth herein to be paid by the Company to the Underwriters.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(b) <u>Non-accountable Expenses</u>. The Company further agrees that, in addition to the expenses payable pursuant to Section 4.6(b), on the Closing Date it will pay to the Representative a non-accountable expense allowance equal to $175,000 from the sale of the Public Securities by deduction from the proceeds of the Offering contemplated herein.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">4.7 <u>Application of Net Proceeds</u>. The Company will apply the net proceeds from the Offering received by it in a manner consistent with the application described under the caption &#8220;Use Of Proceeds&#8221; in the Prospectus Supplement.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreakd41b1214-4ecb-40c5-be05-bdcde667056b" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">36</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">4.8 <u>Delivery of Earnings Statements to Security Holders</u>. The Company will make generally available to its security holders as soon as practicable, but not later than the first day of the fifteenth full calendar month following the Execution Date, an earnings statement (which need not be certified by independent public or independent certified public accountants unless required by the Securities Act or the Rules and Regulations under the Securities Act, but which shall satisfy the provisions of Rule 158(a) under Section 11(a) of the Securities Act) covering a period of at least twelve consecutive months beginning after the Execution Date.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">4.9 <u>Stabilization</u>. Neither the Company, nor, to its knowledge, any of its employees, directors or shareholders (without the consent of the Representative) has taken or will take, directly or indirectly, any action designed to or that has constituted or that might reasonably be expected to cause or result in, under the Exchange Act, or otherwise, stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Public Securities.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">4.10 <u>Internal Controls</u>. The Company will maintain a system of internal accounting controls sufficient to provide reasonable assurances that: (i) transactions are executed in accordance with management&#8217;s general or specific authorization; (ii) transactions are recorded as necessary in order to permit preparation of financial statements in accordance with IFRS and to maintain accountability for assets; (iii) access to assets is permitted only in accordance with management&#8217;s general or specific authorization; and (iv) the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">4.11 <u>Accountants</u>. The Company shall continue to retain an independent certified public accounting firm for a period of at least three years after the Execution Date. The Underwriters acknowledge that the Company Auditor is acceptable to the Underwriters.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">4.12 <u>FINRA</u>. The Company shall advise the Underwriters (who shall make an appropriate filing with FINRA) if it is aware that any 5% or greater shareholder of the Company becomes an affiliate or associated person of an Underwriter.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">4.13 <u>No Fiduciary Duties</u>. The Company acknowledges and agrees that the Underwriters&#8217; responsibility to the Company is solely contractual and commercial in nature, based on arms-length negotiations and that neither the Underwriters nor their affiliates or any selected dealer shall be deemed to be acting in a fiduciary capacity, or otherwise owes any fiduciary duty to the Company or any of its affiliates in connection with the Offering and the other transactions contemplated by this Agreement. Notwithstanding anything in this Agreement to the contrary, the Company acknowledges that the Underwriters may have financial interests in the success of the Offering that are not limited to the difference between the price to the public and the purchase price paid to the Company by the Underwriters for the shares and the Underwriters have no obligation to disclose, or account to the Company for, any of such additional financial interests. The Company hereby waives and releases, to the fullest extent permitted by law, any claims that the Company may have against the Underwriters with respect to any breach or alleged breach of fiduciary duty.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak1c02bcac-a756-45e7-87a2-f06b1fc667ec" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">37</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">4.14 <u>Warrant Shares</u>. If all or any portion of a Warrant is exercised at a time when there is an effective registration statement to cover the issuance of the Warrant Shares or if the Warrant is exercised via cashless exercise at a time when such Warrant Shares would be eligible for resale under Rule 144 by a non-affiliate of the Company, the Warrant Shares issued pursuant to any such exercise shall be issued free of all restrictive legends. If at any time following the date hereof the Registration Statement (or any subsequent registration statement registering the sale or resale of the Warrant Shares) is not effective or is not otherwise available for the sale of the Warrant Shares, the Company shall immediately notify the holders of the Warrants in writing that such registration statement is not then effective and thereafter shall promptly notify such holders when the registration statement is effective again and available for the sale of the Warrant Shares (it being understood and agreed that the foregoing shall not limit the ability of the Company to issue, or any holder thereof to sell, any of the Warrant Shares in compliance with applicable federal and state securities laws). </p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">4.15 <u>Board Composition and Board Designations</u>. The Company shall ensure that: (i) the qualifications of the persons serving as board members and the overall composition of the Board of Directors comply with the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder and with the listing requirements of the Trading Markets and (ii) if applicable, at least one member of the Board of Directors qualifies as a &#8220;financial expert&#8221; as such term is defined under the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">4.16 <u>Securities Laws Disclosure; Publicity</u>. At the request of the Representative, by 8:00 a.m. (New York City time) on the date hereof, the Company shall issue a press release disclosing the material terms of the Offering. The Company and the Representative shall consult with each other in issuing any other press releases with respect to the Offering, and neither the Company nor any Underwriter shall issue any such press release nor otherwise make any such public statement without the prior consent of the Company, with respect to any press release of such Underwriter, or without the prior consent of such Underwriter, with respect to any press release of the Company, which consent shall not unreasonably be withheld or delayed, except if such disclosure is required by law, in which case the disclosing party shall promptly provide the other party with prior notice of such public statement or communication. The Company will not issue press releases or engage in any other publicity, without the Representative&#8217;s prior written consent, for a period ending at 5:00 p.m. (New York City time) on the first business day following the 40th day following the Closing Date, other than normal and customary releases issued in the ordinary course of the Company&#8217;s business.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">4.17 <u>Shareholder Rights Plan</u>. No claim will be made or enforced by the Company or, with the consent of the Company, any other Person, that any Underwriter of the Public Securities is an &#8220;Acquiring Person&#8221; under any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or similar anti-takeover plan or arrangement in effect or hereafter adopted by the Company, or that any Underwriter of Public Securities could be deemed to trigger the provisions of any such plan or arrangement, by virtue of receiving Public Securities.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak6f180fd8-4f85-4703-9106-41677eb7bc7c" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">38</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">4.18 <u>Reservation of Common Shares</u>. As of the date hereof, the Company has reserved and the Company shall continue to reserve and keep available at all times, free of preemptive rights, a sufficient number of Common Shares for the purpose of enabling the Company to issue Option Shares pursuant to the Over-Allotment Option and Warrant Shares pursuant to any exercise of the Warrants.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">4.19 <u>Listing of Common Shares</u>. The Company hereby agrees to use commercially reasonable efforts to maintain the listing or quotation of the Common Shares on the Trading Markets on which it is currently listed, and concurrently with the Closing, the Company shall apply to list or quote all of the Closing Shares, Option Shares and Warrant Shares on such Trading Markets and promptly secure the listing of all of the Closing Shares, Option Shares and Warrant Shares on such Trading Markets. The Company further agrees, if the Company applies to have the Common Shares traded on any other Trading Markets, it will then include in such application all of the Closing Shares, Option Shares and Warrant Shares, and will take such other action as is necessary to cause all of the Closing Shares, Option Shares and Warrant Shares to be listed or quoted on such other Trading Market as promptly as possible. The Company will then take all action reasonably necessary to continue the listing and trading of its Common Shares on a Trading Market and will comply in all respects with the Company&#8217;s reporting, filing and other obligations under the bylaws or rules of the Trading Markets. The Company agrees to maintain the eligibility of the Common Shares for electronic transfer through the Depository Trust Company or another established clearing corporation, including, without limitation, by timely payment of fees to the Depository Trust Company or such other established clearing corporation in connection with such electronic transfer.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">4.20 <u>Subsequent Equity Sales</u>. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(a) From the date hereof until the 90<sup>th</sup> day following the Closing Date, neither the Company nor any Subsidiary shall issue, enter into any agreement to issue or announce the issuance or proposed issuance of any Common Shares or Common Shares Equivalents.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(b) From the date hereof until no Warrants are outstanding, the Company shall be prohibited from effecting or entering into an agreement to effect any issuance by the Company or any of its Subsidiaries of Common Shares or Common Share Equivalents (or a combination of units thereof) involving a Variable Rate Transaction. &#8220;<u>Variable Rate Transaction</u>&#8221; means a transaction in which the Company (i) issues or sells any debt or equity securities that are convertible into, exchangeable or exercisable for, or include the right to receive, additional Common Shares either (A) at a conversion price, exercise price or exchange rate or other price that is based upon, and/or varies with, the trading prices of or quotations for the Common Shares at any time after the initial issuance of such debt or equity securities or (B) with a conversion, exercise or exchange price that is subject to being reset at some future date after the initial issuance of such debt or equity security or upon the occurrence of specified or contingent events directly or indirectly related to the business of the Company or the market for the Common Shares or (ii) enters into, or effects a transaction under, any agreement, including, but not limited to, an equity line of credit, whereby the Company may issue securities at a future determined price. Any Underwriter shall be entitled to obtain injunctive relief against the Company to preclude any such issuance, which remedy shall be in addition to any right to collect damages. Notwithstanding the foregoing, following the 90<sup>th</sup> day after the Closing Date, any sales made pursuant to the sales agreement between the Company and Cantor Fitzgerald &amp; Co., dated as of August 4, 2017, as amended on or prior to the date hereof, shall not be deemed a Variable Rate Transaction.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreakd64c65ab-db6b-45e5-a9b9-778c6b4acc02" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">39</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(c) Notwithstanding the foregoing, this Section 4.20 shall not apply in respect of an Exempt Issuance, except that no Variable Rate Transaction shall be an Exempt Issuance. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">4.21 <u>Research Independence</u>. The Company acknowledges that each Underwriter&#8217;s research analysts and research departments, if any, are required to be independent from their respective investment banking divisions and are subject to certain regulations and internal policies, and that such Underwriter&#8217;s research analysts may hold and make statements or investment recommendations and/or publish research reports with respect to the Company and/or the offering that differ from the views of its investment bankers. The Company hereby waives and releases, to the fullest extent permitted by law, any claims that the Company may have against such Underwriter with respect to any conflict of interest that may arise from the fact that the views expressed by their independent research analysts and research departments may be different from or inconsistent with the views or advice communicated to the Company by such Underwriter&#8217;s investment banking divisions. The Company acknowledges that the Representative is a full service securities firm and as such from time to time, subject to applicable securities laws, may effect transactions for its own account or the account of its customers and hold long or short position in debt or equity securities of the Company.</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0.5in">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 0in" align="center"><b>ARTICLE V.</b></p> <p style="MARGIN: 0px; TEXT-INDENT: 0in" align="center"><b>DEFAULT BY UNDERWRITERS</b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0.5in" align="justify">If on the Closing Date or any Option Closing Date, if any Underwriter shall fail to purchase and pay for the portion of the Closing Securities or Option Securities, as the case may be, which such Underwriter has agreed to purchase and pay for on such date (otherwise than by reason of any default on the part of the Company), the Representative, or if the Representative is the defaulting Underwriter, the non-defaulting Underwriters, shall use their reasonable efforts to procure within 36 hours thereafter one or more of the other Underwriters, or any others, to purchase from the Company such amounts as may be agreed upon and upon the terms set forth herein, the Closing Securities or Option Securities, as the case may be, which the defaulting Underwriter or Underwriters failed to purchase. If during such 36 hours the Representative shall not have procured such other Underwriters, or any others, to purchase the Closing Securities or Option Securities, as the case may be, agreed to be purchased by the defaulting Underwriter or Underwriters, then (a) if the aggregate number of Closing Securities or Option Securities, as the case may be, with respect to which such default shall occur does not exceed 10% of the Closing Securities or Option Securities, as the case may be, covered hereby, the other Underwriters shall be obligated, severally, in proportion to the respective numbers of Closing Securities or Option Securities, as the case may be, which they are obligated to purchase hereunder, to purchase the Closing Securities or Option Securities, as the case may be, which such defaulting Underwriter or Underwriters failed to purchase, or (b) if the aggregate number of Closing Securities or Option Securities, as the case may be, with respect to which such default shall occur exceeds 10% of the Closing Securities or Option Securities, as the case may be, covered hereby, the Company or the Representative will have the right to terminate this Agreement without liability on the part of the non-defaulting Underwriters or of the Company except to the extent provided in Article VI hereof. In the event of a default by any Underwriter or Underwriters, as set forth in this Article V, the applicable Closing Date may be postponed for such period, not exceeding seven days, as the Representative, or if the Representative is the defaulting Underwriter, the non-defaulting Underwriters, may determine in order that the required changes in the Prospectus or in any other documents or arrangements may be effected. The term &#8220;Underwriter&#8221; includes any person substituted for a defaulting Underwriter. Any action taken under this Section shall not relieve any defaulting Underwriter from liability in respect of any default of such Underwriter under this Agreement.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak9fa3ba26-98f7-4b30-89af-fcbc7721ac3c" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">40</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 0in" align="center"><b>ARTICLE VI.</b></p> <p style="MARGIN: 0px; TEXT-INDENT: 0in" align="center"><b>INDEMNIFICATION</b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">6.1 <u>Indemnification of the Underwriters</u>. Subject to the conditions set forth below, the Company agrees to indemnify and hold harmless each of the Underwriters, and each of their respective directors, officers and employees and each Person, if any, who controls such Underwriter (&#8220;<u>Controlling Person</u>&#8221;) within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, against any and all loss, liability, claim, damage and expense whatsoever (including but not limited to any and all legal or other expenses reasonably incurred in investigating, preparing or defending against any litigation, commenced or threatened, or any claim whatsoever, whether arising out of any action between such Underwriter and the Company or between such Underwriter and any third party or otherwise) to which they or any of them may become subject under the Securities Act, the Exchange Act or any other statute or at common law or otherwise or under the laws of foreign countries, arising out of or based upon any untrue statement or alleged untrue statement of a material fact contained in (i) any Preliminary Prospectus, if any, the Registration Statement or the Prospectus (as from time to time each may be amended and supplemented); (ii) any materials or information provided to investors by, or with the prior written approval of, the Company in connection with the marketing of the offering of the Public Securities, including any &#8220;road show&#8221; or investor presentations made to investors by the Company (whether in person or electronically); or (iii) any application or other document or written communication (in this Article VI, collectively called &#8220;<u>application</u>&#8221;) executed by the Company or based upon written information furnished by the Company in any jurisdiction in order to qualify the Public Securities under the securities laws thereof or filed with the Commission, any state securities commission or agency, Trading Market or any securities exchange; or the omission or alleged omission therefrom of 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, unless such statement or omission was made in reliance upon and in conformity with written information furnished to the Company with respect to the applicable Underwriter by or on behalf of such Underwriter expressly for use in any Preliminary Prospectus, if any, the Registration Statement or Prospectus, or any amendment or supplement thereto, or in any application, as the case may be. With respect to any untrue statement or omission or alleged untrue statement or omission made in the Preliminary Prospectus, if any, the indemnity agreement contained in this Section 6.1 shall not inure to the benefit of an Underwriter to the extent that any loss, liability, claim, damage or expense of such Underwriter results from the fact that a copy of the Prospectus was not given or sent to the Person asserting any such loss, liability, claim or damage at or prior to the written confirmation of sale of the Public Securities to such Person as required by the Securities Act and the rules and regulations thereunder, and if the untrue statement or omission has been corrected in the Prospectus, unless such failure to deliver the Prospectus was a result of non-compliance by the Company with its obligations under this Agreement. The Company agrees promptly to notify each Underwriter of the commencement of any litigation or proceedings against the Company or any of its officers, directors or Controlling Persons in connection with the issue and sale of the Public Securities or in connection with the Registration Statement or Prospectus.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak5d532dd3-ff49-42cb-ba49-8bd9fb35e6e3" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">41</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">6.2 <u>Procedure</u>. If any action is brought against an Underwriter or a Controlling Person in respect of which indemnity may be sought against the Company pursuant to Section 6.1, such Underwriter, such Controlling Person, as the case may be, shall promptly notify the Company in writing of the institution of such action and the Company shall assume the defense of such action, including the employment and fees of counsel (subject to the reasonable approval of such Underwriter) and payment of actual expenses. Such Underwriter, or Controlling Person shall have the right to employ its or their own counsel in any such case, but the fees and expenses of such counsel shall be at the expense of such Underwriter or Controlling Person unless (i) the employment of such counsel at the expense of the Company shall have been authorized in writing by the Company in connection with the defense of such action, or (ii) the Company shall not have employed counsel to have charge of the defense of such action, or (iii) such indemnified party or parties shall have reasonably concluded that there may be defenses available to it or them which are different from or additional to those available to the Company (in which case the Company shall not have the right to direct the defense of such action on behalf of the indemnified party or parties), in any of which events the reasonable fees and expenses of not more than one additional firm of attorneys selected by such Underwriter (in addition to local counsel), and/or Controlling Person shall be borne by the Company. Notwithstanding anything to the contrary contained herein, if any Underwriter Controlling Person shall assume the defense of such action as provided above, the Company shall have the right to approve the terms of any settlement of such action which approval shall not be unreasonably withheld.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">6.3 <u>Indemnification of the Company</u>. Each Underwriter severally and not jointly agrees to indemnify and hold harmless the Company, its directors, officers and employees and agents who control the Company within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act against any and all loss, liability, claim, damage and expense described in the foregoing indemnity from the Company to such Underwriter, as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions made in any Preliminary Prospectus, if any, the Registration Statement or Prospectus or any amendment or supplement thereto or in any application, in reliance upon, and in strict conformity with, written information furnished to the Company with respect to such Underwriter by or on behalf of such Underwriter expressly for use in such Preliminary Prospectus, if any, the Registration Statement or Prospectus or any amendment or supplement thereto or in any such application. In case any action shall be brought against the Company or any other Person so indemnified based on any Preliminary Prospectus, if any, the Registration Statement or Prospectus or any amendment or supplement thereto or any application, and in respect of which indemnity may be sought against such Underwriter, such Underwriter shall have the rights and duties given to the Company, and the Company and each other Person so indemnified shall have the rights and duties given to such Underwriter by the provisions of this Article VI. Notwithstanding the provisions of this Section 6.3, no Underwriter shall be required to indemnify the Company for any amount in excess of the underwriting discounts and commissions applicable to the Public Securities purchased by such Underwriter. The Underwriters&#8217; obligations in this Section 6.3 to indemnify the Company are several in proportion to their respective underwriting obligations and not joint.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak49045a70-cf11-4c94-943e-301e26147416" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">42</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">6.4 <u>Contribution</u>.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(a) <u>Contribution Rights</u>. In order to provide for just and equitable contribution under the Securities Act in any case in which (i) any Person entitled to indemnification under this Article VI makes a claim for indemnification pursuant hereto but it is judicially determined (by the entry of a final judgment or decree by a court of competent jurisdiction and the expiration of time to appeal or the denial of the last right of appeal) that such indemnification may not be enforced in such case notwithstanding the fact that this Article VI provides for indemnification in such case, or (ii) contribution under the Securities Act, the Exchange Act or otherwise may be required on the part of any such Person in circumstances for which indemnification is provided under this Article VI, then, and in each such case, the Company and each Underwriter, severally and not jointly, shall contribute to the aggregate losses, liabilities, claims, damages and expenses of the nature contemplated by said indemnity agreement incurred by the Company and such Underwriter, as incurred, in such proportions that such Underwriter is responsible for that portion represented by the percentage that the underwriting discount appearing on the cover page of the Prospectus bears to the initial offering price appearing thereon and the Company is responsible for the balance; provided, that, no Person guilty of a fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation. For purposes of this Section, each director, officer and employee of such Underwriter or the Company, as applicable, and each Person, if any, who controls such Underwriter or the Company, as applicable, within the meaning of Section 15 of the Securities Act shall have the same rights to contribution as such Underwriter or the Company, as applicable. Notwithstanding the provisions of this Section 6.4, no Underwriter shall be required to contribute any amount in excess of the underwriting discounts and commissions applicable to the Public Securities purchased by such Underwriter. The Underwriters&#8217; obligations in this Section 6.4 to contribute are several in proportion to their respective underwriting obligations and not joint.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(b) <u>Contribution Procedure</u>. Within fifteen days after receipt by any party to this Agreement (or its representative) of notice of the commencement of any action, suit or proceeding, such party will, if a claim for contribution in respect thereof is to be made against another party (&#8220;<u>contributing party</u>&#8221;), notify the contributing party of the commencement thereof, but the failure to so notify the contributing party will not relieve it from any liability which it may have to any other party other than for contribution hereunder. In case any such action, suit or proceeding is brought against any party, and such party notifies a contributing party or its representative of the commencement thereof within the aforesaid fifteen days, the contributing party will be entitled to participate therein with the notifying party and any other contributing party similarly notified. Any such contributing party shall not be liable to any party seeking contribution on account of any settlement of any claim, action or proceeding affected by such party seeking contribution without the written consent of such contributing party. The contribution provisions contained in this Section 6.4 are intended to supersede, to the extent permitted by law, any right to contribution under the Securities Act, the Exchange Act or otherwise available.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak1c72bf15-c950-49e8-be7a-70110129f234" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">43</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 0in" align="center"><b>ARTICLE VII.</b></p> <p style="MARGIN: 0px; TEXT-INDENT: 0in" align="center"><b>MISCELLANEOUS</b></p> <p style="MARGIN: 0px" align="center">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">7.1 <u>Termination</u>.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(a) <u>Termination Right</u>. The Representative shall have the right to terminate this Agreement at any time prior to any Closing Date, (i) if any domestic or international event or act or occurrence has materially disrupted, or in its opinion will in the immediate future materially disrupt, general securities markets in the United States; or (ii) if trading on any Trading Market shall have been suspended or materially limited, or minimum or maximum prices for trading shall have been fixed, or maximum ranges for prices for securities shall have been required by FINRA or by order of the Commission or any other government authority having jurisdiction, or (iii) if the United States shall have become involved in a new war or an increase in major hostilities, or (iv) if a banking moratorium has been declared by a New York State or federal authority, or (v) if a moratorium on foreign exchange trading has been declared which materially adversely impacts the United States securities markets, or (vi) if the Company shall have sustained a material loss by fire, flood, accident, hurricane, earthquake, theft, sabotage or other calamity or malicious act which, whether or not such loss shall have been insured, will, in the Representative&#8217;s opinion, make it inadvisable to proceed with the delivery of the Public Securities, or (vii) if the Company is in material breach of any of its representations, warranties or covenants hereunder, or (viii) if the Representative shall have become aware after the date hereof of such a material adverse change in the conditions or prospects of the Company, or such adverse material change in general market conditions as in the Representative&#8217;s judgment would make it impracticable to proceed with the offering, sale and/or delivery of the Public Securities or to enforce contracts made by the Underwriters for the sale of the Public Securities.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(b) <u>Expenses</u>. In the event this Agreement shall be terminated pursuant to Sections 7.1(a)(ii) or 7.1.(a)(vii), within the time specified herein or any extensions thereof pursuant to the terms herein, the Company shall be obligated to pay to the Representative its actual and accountable out of pocket expenses related to the transactions contemplated herein then due and payable, including the fees and disbursements of Representatives U.S. and Canadian legal counsels of $175,000.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">(c) <u>Indemnification</u>. Notwithstanding any contrary provision contained in this Agreement, any election hereunder or any termination of this Agreement, and whether or not this Agreement is otherwise carried out, the provisions of Article VI shall not be in any way effected by such election or termination or failure to carry out the terms of this Agreement or any part hereof.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">7.2 <u>Entire Agreement</u>. The Transaction Documents, together with the exhibits and schedules thereto, the Prospectus and the Prospectus Supplement, contain the entire understanding of the parties with respect to the subject matter hereof and thereof and supersede all prior agreements and understandings, oral or written, with respect to such matters, which the parties acknowledge have been merged into such documents, exhibits and schedules.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak6f2096ac-4aef-4e0b-9237-934b6ac70fce" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">44</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">7.3 <u>Notices</u>. Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and shall be deemed given and effective on the earliest of: (a) the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number or e-mail attachment at the email address set forth on the signature pages attached hereto at or prior to 5:30 p.m. (New York City time) on a Trading Day, (b) the next Trading Day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number or e-mail attachment at the e-mail address as set forth on the signature pages attached hereto on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (c) the second (2<sup>nd</sup>) Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service or (d) upon actual receipt by the party to whom such notice is required to be given. The address for such notices and communications shall be as set forth on the signature pages attached hereto.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">7.4 <u>Amendments; Waivers</u>. No provision of this Agreement may be waived, modified, supplemented or amended except in a written instrument signed, in the case of an amendment, by the Company and the Representative. No waiver of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">7.5 <u>Headings</u>. The headings herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed to limit or affect any of the provisions hereof.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">7.6 <u>Successors and Assigns</u>. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and permitted assigns.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">7.7 <u>Governing Law</u>. All questions concerning the construction, validity, enforcement and interpretation of the Transaction Documents shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof. Each party agrees that all legal proceedings concerning the interpretations, enforcement and defense of the transactions contemplated by this Agreement and any other Transaction Documents (whether brought against a party hereto or its respective affiliates, directors, officers, shareholders, partners, members, employees or agents) shall be commenced exclusively in the state and federal courts sitting in the City of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the City of New York, Borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction Documents), and hereby irrevocably waives, and agrees not to assert in any action, suit or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is improper or is an inconvenient venue for such proceeding. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law. If either party shall commence an action or proceeding to enforce any provisions of the Transaction Documents, then, in addition to the obligations of the Company under Article VI, the prevailing party in such action, suit or proceeding shall be reimbursed by the other party for its reasonable attorneys&#8217; fees and other costs and expenses incurred with the investigation, preparation and prosecution of such action or proceeding.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak7317f9df-0375-43b4-949f-08a56799986b" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">45</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">7.8 <u>Survival</u>. The representations and warranties contained herein shall survive the Closing and the Option Closing, if any, and the delivery of the Public Securities.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">7.9 <u>Execution</u>. This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to each other party, it being understood that the parties need not sign the same counterpart. In the event that any signature is delivered by facsimile transmission or by e-mail delivery of a &#8220;.pdf&#8221; format data file, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such facsimile or &#8220;.pdf&#8221; signature page were an original thereof.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">7.10 <u>Severability</u>. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or unenforceable.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">7.11 <u>Remedies</u>. In addition to being entitled to exercise all rights provided herein or granted by law, including recovery of damages, the Underwriters and the Company will be entitled to specific performance under the Transaction Documents. The parties agree that monetary damages may not be adequate compensation for any loss incurred by reason of any breach of obligations contained in the Transaction Documents and hereby agree to waive and not to assert in any action for specific performance of any such obligation the defense that a remedy at law would be adequate.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">7.12 <u>Saturdays, Sundays, Holidays, etc</u>. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised on the next succeeding Business Day.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak2a3303d6-3ccc-421d-8720-2bf238f1f25f" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">46</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">7.13 <u>Construction</u>. The parties agree that each of them and/or their respective counsel have reviewed and had an opportunity to revise the Transaction Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of the Transaction Documents or any amendments thereto. In addition, each and every reference to share prices and Common Shares in any Transaction Document shall be subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions of the Common Shares that occur after the date of this Agreement.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 45px" align="justify">7.14 <b><u>WAIVER OF JURY TRIAL</u></b><b>. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVE FOREVER ANY RIGHT TO TRIAL BY JURY. </b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 0in" align="center"><i>(Signature Pages Follow)</i></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak0cadd56e-c3dc-44b3-a571-89bc51bdd865" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">47</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">If the foregoing correctly sets forth the understanding between the Underwriters and the Company, please so indicate in the space provided below for that purpose, whereupon this letter shall constitute a binding agreement among the Company and the several Underwriters in accordance with its terms.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td colspan="2"> <p style="MARGIN: 0px">Very truly yours,</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td colspan="2"> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr> <td>&nbsp;</td> <td colspan="2"> <p style="MARGIN: 0px"><b>AVINO SILVER &amp; GOLD MINES LTD.</b></p></td> <td></td></tr> <tr> <td width="50%">&nbsp;</td> <td width="5%">&nbsp;</td> <td width="35%">&nbsp;</td> <td width="10%">&nbsp;</td></tr> <tr> <td></td> <td>By:</td> <td style="BORDER-BOTTOM: black 1px solid"><em>/s/ David Wolfin</em></td> <td></td></tr> <tr> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">Name:</p></td> <td>David Wolfin</td> <td>&nbsp;</td></tr> <tr> <td>&nbsp;</td> <td>Title:</td> <td>President and Chief Executive Officer</td> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px">Address for Notice:</p> <p style="MARGIN: 0px 0px 0px 0in">&nbsp;</p> <p style="MARGIN: 0px" align="justify">Avino Silver &amp; Gold Mines Ltd.</p> <p style="MARGIN: 0px" align="justify">Suite 900, 570 Granville Street</p> <p style="MARGIN: 0px" align="justify">Vancouver, BC V6C 3P1</p> <p style="MARGIN: 0px">Attention: David Wolfin</p> <p style="MARGIN: 0px" align="justify">Facsimile: (604) 682-3600</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="justify">and with a copy to:</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="justify">Lewis Brisbois Bisgaard &amp; Smith LLP </p> <p style="MARGIN: 0px" align="justify">333 Bush Street, Suite 1100</p> <p style="MARGIN: 0px" align="justify">San Francisco, CA 94104 </p> <p style="MARGIN: 0px" align="justify">Attention: Daniel B. Eng</p> <p style="MARGIN: 0px" align="justify">Facsimile: (415) 434-0882</p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="justify">and:</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="justify">Salley Bowes Harwardt Law Corp.</p> <p style="MARGIN: 0px" align="justify">1750-1185 West Georgia Street</p> <p style="MARGIN: 0px" align="justify">Vancouver, BC V6E 4E6</p> <p style="MARGIN: 0px" align="justify">Attention: Paul Bowes</p> <p style="MARGIN: 0px" align="justify">Facsimile: (604) 688-0778</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreake265c0e8-f7f9-4e17-85b2-356288774c57" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid"> <p style="MARGIN: 0px" align="center">48</p></td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in">Accepted on the date first above written.</p> <p style="MARGIN: 0px 0px 0px 0in"><b>H.C. WAINWRIGHT &amp; CO., LLC</b></p> <p style="MARGIN: 0px 0px 0px 0in">As the Representative of the several </p> <p style="MARGIN: 0px 0px 0px 0in">Underwriters listed on Schedule I</p> <p style="MARGIN: 0px 0px 0px 0in">By: H.C. Wainwright &amp; Co., LLC</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in">By: <em><u>/s/ Mark W. Viklund&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u></em></p> <p style="MARGIN: 0px">Name: Mark W. Viklund&nbsp;&nbsp;&nbsp;</p> <p style="MARGIN: 0px">Title: Chief Executive Officer </p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="justify">Address for Notice:</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in">430 Park Avenue</p> <p style="MARGIN: 0px 0px 0px 0in">New York, New York 10022</p> <p style="MARGIN: 0px 0px 0px 0in">Attention: Mark W. Viklund&nbsp;&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in">Email: mviklund@hcwco.com</p> <p style="MARGIN: 0px 0px 0px 0in">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0in" align="justify">Copy to:</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0in" align="justify">Ellenoff Grossman &amp; Schole LLP </p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0in" align="justify">1345 Avenue of the Americas, 11th Floor</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0in" align="justify">New York, New York 10105</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0in" align="justify">Attention: Robert Charron</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0in" align="justify">Facsimile: (212) 401-4741</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0in" align="justify">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0in" align="justify"> <table id="pagebreakb918cb8e-a6e7-43e9-b4c9-b3a78fc582aa" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid"> <p style="MARGIN: 0px" align="center">49</p></td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 0in" align="center"><b>SCHEDULE I</b></p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="center">SCHEDULE OF UNDERWRITERS</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="justify"> <table style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cols="7" cellpadding="0" width="100%" align="center" border="0"> <tr> <td style="BORDER-BOTTOM: black 1px solid" width="23%"> <p style="MARGIN: 0px">&nbsp;</p></td> <td width="2%"> <p style="MARGIN: 0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: black 1px solid" valign="bottom" width="23%"> <p style="MARGIN: 0px" align="center">Closing Shares </p></td> <td width="2%"> <p style="MARGIN: 0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: black 1px solid" valign="bottom" width="24%"> <p style="MARGIN: 0px" align="center">Closing Warrants&nbsp; </p></td> <td width="2%"> <p style="MARGIN: 0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: black 1px solid" valign="bottom" width="24%"> <p style="MARGIN: 0px" align="center">Closing&nbsp;Purchase </p> <p style="MARGIN: 0px" align="center">Price </p></td></tr> <tr height="15"> <td> <p style="MARGIN: 0px" align="center">H.C Wainwright &amp; Co., LLC</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px" align="center">5,303,887</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px" align="center">&nbsp;5,303,887</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px" align="center">&nbsp;$3,206,199.69</p></td></tr> <tr height="15"> <td> <p style="MARGIN: 0px" align="center">ROTH Capital Partners, LLC</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px" align="center">935,980</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px" align="center">935,980</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px" align="center">&nbsp;$565,799.91</p></td></tr> <tr height="15"> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr height="15"> <td> <p style="MARGIN: 0px" align="center">&nbsp;Total</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px" align="center">&nbsp;6,239,867</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px" align="center">&nbsp;6,239,867</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px" align="center">$3,771,999.60</p></td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="justify"> <table id="pagebreakd5f1b77f-fc5f-41cb-8eaa-338ee7a126fc" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid">&nbsp;</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="center"><b>SCHEDULE A</b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="center">__________________________</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="center"><b>Material Subsidiaries</b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="center">__________________________</p> <p style="MARGIN: 0px">&nbsp;</p> <table style="BORDER-RIGHT: black 1px solid; BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="3" width="100%" align="center" border="0"> <tr height="15"> <td style="BORDER-TOP: black 1px solid; BORDER-LEFT: black 1px solid" valign="top" width="55%"> <p style="MARGIN: 0px">Oniva Silver and Gold Mines S.A. de C.V.</p></td> <td style="BORDER-TOP: black 1px solid; BORDER-LEFT: black 1px solid" valign="top" width="25%"> <p style="MARGIN: 0px 0px 0px 0in">Mexico</p></td> <td style="BORDER-TOP: black 1px solid; BORDER-LEFT: black 1px solid" valign="top" width="25%"> <p style="MARGIN: 0px 0px 0px 0in">100%</p></td></tr> <tr height="15"> <td style="BORDER-TOP: black 1px solid; BORDER-LEFT: black 1px solid" valign="top"> <p style="MARGIN: 0px 0px 0px 0in">Promotora Avino, S.A. de C.V.</p></td> <td style="BORDER-TOP: black 1px solid; BORDER-LEFT: black 1px solid" valign="top"> <p style="MARGIN: 0px 0px 0px 0in">Mexico</p></td> <td style="BORDER-TOP: black 1px solid; BORDER-LEFT: black 1px solid" valign="top"> <p style="MARGIN: 0px 0px 0px 0in">79.09%</p></td></tr> <tr height="15"> <td style="BORDER-TOP: black 1px solid; BORDER-LEFT: black 1px solid" valign="top"> <p style="MARGIN: 0px">Compa&#241;&#237;a Minera Mexicana de Avino, S.A. de C.V.</p></td> <td style="BORDER-TOP: black 1px solid; BORDER-LEFT: black 1px solid" valign="top"> <p style="MARGIN: 0px 0px 0px 0in">Mexico</p></td> <td style="BORDER-TOP: black 1px solid; BORDER-LEFT: black 1px solid" valign="top"> <p style="MARGIN: 0px 0px 0px 0in">98.45% direct</p> <p style="MARGIN: 0px">1.22% indirect </p> <p style="MARGIN: 0px">(Promotora)</p> <p style="MARGIN: 0px 0px 0px 0in">99.67% effective</p></td></tr> <tr height="15"> <td style="BORDER-TOP: black 1px solid; BORDER-LEFT: black 1px solid" valign="top"> <p style="MARGIN: 0px 0px 0px 0in">Bralorne Gold Mines Ltd.</p></td> <td style="BORDER-TOP: black 1px solid; BORDER-LEFT: black 1px solid" valign="top"> <p style="MARGIN: 0px 0px 0px 0in">British Columbia</p></td> <td style="BORDER-TOP: black 1px solid; BORDER-LEFT: black 1px solid" valign="top"> <p style="MARGIN: 0px 0px 0px 0in">100%</p></td></tr></table> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak6c3451b4-f27c-4bc0-9c4c-6f27816e7fc2" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid">&nbsp;</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="center"><b>SCHEDULE B</b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 90px">Title reports and corporate opinions with respect to the Material Properties</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td valign="top" width="4%"> <p style="MARGIN: 0px">&nbsp;</p></td> <td valign="top" width="4%">1.</td> <td valign="top">Avino Mineral Properties title opinion letter dated February 1, 2018 issued by Bufete Gonzalez Olguin, S.C.</td></tr> <tr> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <tr> <td valign="top"> <p style="MARGIN: 0px">&nbsp;</p></td> <td valign="top">2.</td> <td valign="top">Updated Title Opinion on the Bralorne Mine properties dated April 27, 2018 (the &#8220;Title Opinion Letter&#8221;) issued by Salley Bowes Harwardt Law Corp</td></tr></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td style="BORDER-BOTTOM: black 1px solid">&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p></BODY><!--Document Created by EDGARMaster--></html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4.1
<SEQUENCE>3
<FILENAME>avino_ex41.htm
<DESCRIPTION>COMMON SHARE PURCHASE WARRANT
<TEXT>
<html><head><title>avino_ex41.htm</title><!--Document Created by EDGARMaster--></head><BODY spellcheck="true" style="text-align:justify;font:10pt TIMES NEW ROMAN;margin:0px 7%"><p style="MARGIN: 0px" align="right"><b>EXHIBIT 4.1</b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="center"><b>COMMON SHARE PURCHASE WARRANT</b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in" align="center"><b>AVINO SILVER &amp; GOLD MINES LTD.</b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cols="3" cellpadding="0" width="100%" align="center" border="0"> <tr> <td width="50%"> <p style="MARGIN: 0px">Warrant Shares: _______</p></td> <td width="50%"> <p style="MARGIN: 0px" align="right">Initial Exercise Date: September __, 2018</p></td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 1in" align="justify">THIS COMMON SHARE PURCHASE WARRANT (the &#8220;<u>Warrant</u>&#8221;) certifies that, for value received, _____________ or its assigns (the &#8220;<u>Holder</u>&#8221;) is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after the date hereof (the &#8220;<u>Initial Exercise Date</u>&#8221;) and on or prior to 5:00 p.m. (New York City time) on ______________ (the &#8220;<u>Termination Date</u>&#8221;) but not thereafter, to subscribe for and purchase from Avino Silver &amp; Gold Mines Ltd., a company amalgamated under the laws of the Province of British Columbia, Canada (the &#8220;<u>Company</u>&#8221;), up to ______ shares (as subject to adjustment hereunder, the &#8220;<u>Warrant Shares</u>&#8221;) of Common Shares. The purchase price of one Common Share under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b). </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0.5in" align="justify"><u>Section 1</u>. <u>Definitions</u>. In addition to the terms defined elsewhere in this Warrant, the following terms have the meanings indicated in this Section 1:</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Affiliate</u>&#8221; means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Bid Price</u>&#8221; means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Shares are then listed or quoted on a Trading Market, the bid price of the Common Shares for the time in question (or the nearest preceding date) on the Trading Market on which the Common Shares are then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume weighted average price of the Common Shares for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Common Shares are not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Shares are then reported in the &#8220;Pink Sheets&#8221; published by OTC Markets Group, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per Common Share so reported, or (d) in all other cases, the fair market value of a Common Share as determined by an independent appraiser selected in good faith by the Holders of a majority in interest of the Warrants then outstanding and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Board of Directors</u>&#8221; means the board of directors of the Company.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Business Day</u>&#8221; means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or any day on which banking institutions in the State of New York are authorized or required by law or other governmental action to close.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak81b31334-c8fa-4eab-b21e-76e6a9327074" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">1</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Commission</u>&#8221; means the United States Securities and Exchange Commission.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Common Shares</u>&#8221; means the common shares of the Company, no par value per share, and any other class of securities into which such securities may hereafter be reclassified or changed.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Common Shares Equivalents</u>&#8221; means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire at any time Common Shares, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Shares..</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Exchange Act</u>&#8221; means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Person</u>&#8221; means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Registration Statement</u>&#8221; means the Company&#8217;s registration statement on Form F-3 (File No. 333-226963).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Securities Act</u>&#8221; means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Trading Day</u>&#8221; means a day on which the Common Shares are traded on a Trading Market.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Trading Market</u>&#8221; means any of the following markets or exchanges on which the Common Shares are listed or quoted for trading on the date in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market or the New York Stock Exchange (or any successors to any of the foregoing.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Transfer Agent</u>&#8221; means Computershare Investor Services Inc., the current transfer agent of the Company and any successor transfer agent of the Company.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak081c7587-821a-4aaa-adce-88d8eeb299f9" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">2</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>VWAP</u>&#8221; means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Shares are then listed or quoted on a Trading Market, the daily volume weighted average price of the Common Shares for such date (or the nearest preceding date) on the Trading Market on which the Common Shares are then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume weighted average price of the Common Shares for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Common Shares are not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Shares are then reported in the &#8220;Pink Sheets&#8221; published by OTC Markets Group, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per Common Share so reported, or (d) in all other cases, the fair market value of a Common Share as determined by an independent appraiser selected in good faith by the holders of a majority in interest of the Warrants then outstanding and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">&#8220;<u>Warrants</u>&#8221; means this Warrant and other Common Shares purchase warrants issued by the Company pursuant to the Registration Statement.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0.5in" align="justify"><u>Section 2</u>. <u>Exercise</u>.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">a) <u>Exercise of Warrant</u>. Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Initial Exercise Date and on or before the Termination Date by delivery to the Company of a duly executed facsimile copy (or e-mail attachment) of the Notice of Exercise in the form annexed hereto (the &#8220;<u>Notice of Exercise</u>&#8221;). Within the earlier of (i) two (2) Trading Days and (ii) the number of Trading Days comprising the Standard Settlement Period (as defined in Section 2(d)(i) herein) following the date of exercise as aforesaid, the Holder shall deliver the aggregate Exercise Price for the shares specified in the applicable Notice of Exercise by wire transfer or cashier&#8217;s check drawn on a United States bank unless the cashless exercise procedure specified in Section 2(c) below is specified in the applicable Notice of Exercise. No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise be required. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender this Warrant to the Company for cancellation within three (3) Trading Days of the date on which the final Notice of Exercise is delivered to the Company. Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased. The Holder and the Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company shall deliver any objection to any Notice of Exercise within one (1) Business Day of receipt of such notice. <b>The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time may be less than the amount stated on the face hereof.</b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">b) <u>Exercise Price</u>. The exercise price per Common Share under this Warrant shall be $_____, subject to adjustment hereunder (the &#8220;<u>Exercise Price</u>&#8221;). </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak6bd7136c-2705-4096-9729-be525f7a5826" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">3</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">c) <u>Cashless Exercise</u>. If at the time of exercise hereof there is no effective registration statement registering, or the prospectus contained therein is not available for the issuance of the Warrant Shares to the Holder, then this Warrant may also be exercised, in whole or in part, at such time by means of a &#8220;cashless exercise&#8221; in which the Holder shall be entitled to receive a number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="justify"> <table style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td valign="top" width="8%"> <p style="MARGIN: 0px">&nbsp;</p></td> <td valign="top" width="4%">(A)</td> <td valign="top">= as applicable: (i) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise if such Notice of Exercise is (1) both executed and delivered pursuant to Section 2(a) hereof on a day that is not a Trading Day or (2) both executed and delivered pursuant to Section 2(a) hereof on a Trading Day prior to the opening of &#8220;regular trading hours&#8221; (as defined in Rule 600(b)(64) of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii) at the option of the Holder, either (y) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise or (z) the Bid Price of the Common Shares on the principal Trading Market as reported by Bloomberg L.P. as of the time of the Holder&#8217;s execution of the applicable Notice of Exercise if such Notice of Exercise is executed during &#8220;regular trading hours&#8221; on a Trading Day and is delivered within two (2) hours thereafter (including until two (2) hours after the close of &#8220;regular trading hours&#8221; on a Trading Day) pursuant to Section 2(a) hereof or (iii) the VWAP on the date of the applicable Notice of Exercise if the date of such Notice of Exercise is a Trading Day and such Notice of Exercise is both executed and delivered pursuant to Section 2(a) hereof after the close of &#8220;regular trading hours&#8221; on such Trading Day;</td></tr> <tr> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <tr> <td valign="top"> <p style="MARGIN: 0px">&nbsp;</p></td> <td valign="top">(B)</td> <td valign="top">= the Exercise Price of this Warrant, as adjusted hereunder; and</td></tr> <tr> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <tr> <td valign="top"> <p style="MARGIN: 0px">&nbsp;</p></td> <td valign="top">(X)</td> <td valign="top">= the number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise.</td></tr></tr></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">If Warrant Shares are issued in such a cashless exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9) of the Securities Act, the Warrant Shares shall take on the registered characteristics of the Warrants being exercised. The Company agrees not to take any position contrary to this Section 2(c).</p> <p style="MARGIN: 0px 0px 0px 103.5pt; TEXT-INDENT: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">Notwithstanding anything herein to the contrary, on the Termination Date, this Warrant shall be automatically exercised via cashless exercise pursuant to this Section 2(c).</p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="justify"> <table id="pagebreak2d6bd5a6-67e3-4581-bbbd-8a65f19628f1" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">4</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">d) <u>Mechanics of Exercise</u>. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1.5in; TEXT-INDENT: 45px" align="justify">i. <u>Delivery of Warrant Shares Upon Exercise</u>. The Company shall cause the Warrant Shares purchased hereunder to be transmitted by the Transfer Agent to the Holder by crediting the account of the Holder&#8217;s or its designee&#8217;s balance account with The Depository Trust Company through its Deposit or Withdrawal at Custodian system (&#8220;<u>DWAC</u>&#8221;) if the Company is then a participant in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale of the Warrant Shares by Holder or (B) this Warrant is being exercised via cashless exercise, and otherwise by physical delivery of a certificate, registered in the Company&#8217;s share register in the name of the Holder or its designee, for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the address specified by the Holder in the Notice of Exercise by the date that is the earliest of (i) two (2) Trading Days after the delivery to the Company of the Notice of Exercise, (ii) one (1) Trading Day after delivery of the aggregate Exercise Price to the Company and (iii) the number of Trading Days comprising the Standard Settlement Period after the delivery to the Company of the Notice of Exercise (such date, the &#8220;<u>Warrant Share Delivery Date</u>&#8221;). Upon delivery of the Notice of Exercise, the Holder shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date of delivery of the Warrant Shares, provided that payment of the aggregate Exercise Price (other than in the case of a cashless exercise) is received within the earlier of (i) two (2) Trading Days and (ii) the number of Trading Days comprising the Standard Settlement Period following delivery of the Notice of Exercise. If the Company fails for any reason to deliver to the Holder the Warrant Shares subject to a Notice of Exercise by the Warrant Share Delivery Date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the VWAP of the Common Shares on the date of the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading Day on the fifth Trading Day after such liquidated damages begin to accrue) for each Trading Day after such Warrant Share Delivery Date until such Warrant Shares are delivered or Holder rescinds such exercise. The Company agrees to maintain a transfer agent that is a participant in the FAST program so long as this Warrant remains outstanding and exercisable. As used herein, &#8220;<u>Standard Settlement Period</u>&#8221; means the standard settlement period, expressed in a number of Trading Days, on the Company&#8217;s primary Trading Market with respect to the Common Shares as in effect on the date of delivery of the Notice of Exercise. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1.5in; TEXT-INDENT: 45px" align="justify">ii. <u>Delivery of New Warrants Upon Exercise</u>. If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder and upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in all other respects be identical with this Warrant.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreakb12429a2-ef31-4370-ada5-1a9a9c2634ae" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">5</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1.5in; TEXT-INDENT: 45px" align="justify">iii. <u>Rescission Rights</u>. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section 2(d)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1.5in; TEXT-INDENT: 45px" align="justify">iv. <u>Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise</u>. In addition to any other rights available to the Holder, if the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with the provisions of Section 2(d)(i) above pursuant to an exercise on or before the Warrant Share Delivery Date, and if after such date the Holder is required by its broker to purchase (in an open market transaction or otherwise) or the Holder&#8217;s brokerage firm otherwise purchases, Common Shares to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a &#8220;<u>Buy-In</u>&#8221;), then the Company shall (A) pay in cash to the Holder the amount, if any, by which (x) the Holder&#8217;s total purchase price (including brokerage commissions, if any) for the Common Shares so purchased exceeds (y) the amount obtained by multiplying (1) the number of Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise at issue times (2) the price at which the sell order giving rise to such purchase obligation was executed, and (B) at the option of the Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in which case such exercise shall be deemed rescinded) or deliver to the Holder the number of Common Shares that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases Common Shares having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise of Common Shares with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (A) of the immediately preceding sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall limit a Holder&#8217;s right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company&#8217;s failure to timely deliver Common Shares upon exercise of the Warrant as required pursuant to the terms hereof.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1.5in; TEXT-INDENT: 45px" align="justify">v. <u>No Fractional Shares or Scrip</u>. No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Exercise Price or round up to the next whole share.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak85be3a6f-414d-404c-bcf2-2e05a51030cc" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">6</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1.5in; TEXT-INDENT: 45px" align="justify">vi. <u>Charges, Taxes and Expenses</u>. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid by the Company, and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; <u>provided</u>, <u>however</u>, that in the event that Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto. The Company shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise and all fees to the Depository Trust Company (or another established clearing corporation performing similar functions) required for same-day electronic delivery of the Warrant Shares.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1.5in; TEXT-INDENT: 45px" align="justify">vii. <u>Closing of Books</u>. The Company will not close its stockholder books or records in any manner which prevents the timely exercise of this Warrant, pursuant to the terms hereof.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">e) <u>Holder&#8217;s Exercise Limitations</u>. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to exercise any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance after exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder&#8217;s Affiliates, and any other Persons acting as a group together with the Holder or any of the Holder&#8217;s Affiliates (such Persons, &#8220;Attribution Parties&#8221;)), would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the number of Common Shares beneficially owned by the Holder and its Affiliates and Attribution Parties shall include the number of Common Shares issuable upon exercise of this Warrant with respect to which such determination is being made, but shall exclude the number of Common Shares which would be issuable upon (i) exercise of the remaining, nonexercised portion of this Warrant beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation, any other Common Share Equivalents) subject to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its Affiliates or Attribution Parties. Except as set forth in the preceding sentence, for purposes of this Section 2(e), beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being acknowledged by the Holder that the Company is not representing to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible for any schedules required to be filed in accordance therewith. To the extent that the limitation contained in this Section 2(e) applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable shall be in the sole discretion of the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder&#8217;s determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation to verify or confirm the accuracy of such determination. In addition, a determination as to any group status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Section 2(e), in determining the number of outstanding Common Shares, a Holder may rely on the number of outstanding s Common Shares as reflected in (A) the Company&#8217;s most recent periodic or annual report filed with the Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a more recent written notice by the Company or the Transfer Agent setting forth the number of Common Shares outstanding. Upon the written or oral request of a Holder, the Company shall within one Trading Day confirm orally and in writing to the Holder the number of Common Shares then outstanding. In any case, the number of outstanding Common Shares shall be determined after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by the Holder or its Affiliates or Attribution Parties since the date as of which such number of outstanding Common Shares was reported. The &#8220;<u>Beneficial Ownership Limitation</u>&#8221; shall be 4.99% (or, upon election by a Holder prior to the issuance of any Warrants, 9.99%) of the number of Common Shares outstanding immediately after giving effect to the issuance of Common Shares issuable upon exercise of this Warrant. The Holder, upon notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 2(e), provided that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of Common Shares outstanding immediately after giving effect to the issuance of Common Shares upon exercise of this Warrant held by the Holder and the provisions of this Section 2(e) shall continue to apply. Any increase in the Beneficial Ownership Limitation will not be effective until the 61<sup>st</sup> day after such notice is delivered to the Company. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section 2(e) to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Warrant. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreake0a14d00-ac35-4465-82f5-28664d4d9cdd" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">7</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0.5in" align="justify"><u>Section 3</u>. <u>Certain </u><u>Adjustments</u>.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">a) <u>Stock Dividends and Splits</u>. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or otherwise makes a distribution or distributions on Common Shares or any other equity or equity equivalent securities payable in Common Shares (which, for avoidance of doubt, shall not include any Common Shares issued by the Company upon exercise of this Warrant), (ii) subdivides outstanding Common Shares into a larger number of shares, (iii) combines (including by way of reverse stock split) outstanding Common Shares into a smaller number of shares, or (iv) issues by reclassification of Common Shares any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of Common Shares (excluding treasury shares, if any) outstanding immediately before such event and of which the denominator shall be the number of Common Shares outstanding immediately after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Exercise Price of this Warrant shall remain unchanged. Any adjustment made pursuant to this Section 3(a) shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re&#8209;classification.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">b) <u>Subsequent Rights Offerings</u>. In addition to any adjustments pursuant to Section 3(a) above, if at any time the Company grants, issues or sells any Common Share Equivalents or rights to purchase stock, warrants, securities or other property pro rata to the record holders of any class of Common Shares (the &#8220;<u>Purchase Rights</u>&#8221;), then the Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of Common Shares acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of Common Shares are to be determined for the grant, issue or sale of such Purchase Rights (provided, however, to the extent that the Holder&#8217;s right to participate in any such Purchase Right would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial ownership of such Common Shares as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall be held in abeyance for the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation). </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak0ab322d3-b98e-4883-a518-325065b89bad" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">8</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">c) <u>Pro Rata Distributions</u>. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or other distribution of its assets (or rights to acquire its assets) to holders of Common Shares, by way of return of capital or otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a &#8220;<u>Distribution</u>&#8221;), at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution to the same extent that the Holder would have participated therein if the Holder had held the number of Common Shares acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the date as of which the record holders of Common Shares are to be determined for the participation in such Distribution (<u>provided</u>, <u>however</u>, to the extent that the Holder&#8217;s right to participate in any such Distribution would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Distribution to such extent (or in the beneficial ownership of any Common Shares as a result of such Distribution to such extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation). </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak4a2e5bb5-284f-4140-9d3f-b60894dd556c" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">9</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">d) <u>Fundamental Transaction</u>. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company, directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which holders of Common Shares are permitted to sell, tender or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding Common Shares, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization or recapitalization of the Common Shares or any compulsory share exchange pursuant to which the Common Shares are effectively converted into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactions consummates a stock or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with another Person or group of Persons whereby such other Person or group acquires more than 50% of the outstanding Common Shares (not including any Common Shares held by the other Person or other Persons making or party to, or associated or affiliated with the other Persons making or party to, such stock or share purchase agreement or other business combination) (each a &#8220;<u>Fundamental Transaction</u>&#8221;), then, upon any subsequent exercise of this Warrant, the Holder shall have the right to receive, for each Warrant Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option of the Holder (without regard to any limitation in Section 2(e) on the exercise of this Warrant), the number of Common Shares of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional consideration (the &#8220;<u>Alternate Consideration</u>&#8221;) receivable as a result of such Fundamental Transaction by a holder of the number of Common Shares for which this Warrant is exercisable immediately prior to such Fundamental Transaction (without regard to any limitation in Section 2(e) on the exercise of this Warrant). For purposes of any such exercise, the determination of the Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one Common Share in such Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If holders of Common Shares are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such Fundamental Transaction. The Company shall cause any successor entity in a Fundamental Transaction in which the Company is not the survivor (the &#8220;<u>Successor Entity</u>&#8221;) to assume in writing all of the obligations of the Company under this Warrant in accordance with the provisions of this Section 3(e) pursuant to written agreements in form and substance reasonably satisfactory to the Holder and approved by the Holder (without unreasonable delay) prior to such Fundamental Transaction and shall, at the option of the Holder, deliver to the Holder in exchange for this Warrant a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this Warrant which is exercisable for a corresponding number of shares of capital stock of such Successor Entity (or its parent entity) equivalent to the Common Shares acquirable and receivable upon exercise of this Warrant (without regard to any limitations on the exercise of this Warrant) prior to such Fundamental Transaction, and with an exercise price which applies the exercise price hereunder to such shares of capital stock (but taking into account the relative value of the Common Shares pursuant to such Fundamental Transaction and the value of such shares of capital stock, such number of shares of capital stock and such exercise price being for the purpose of protecting the economic value of this Warrant immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory in form and substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall succeed to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Warrant referring to the &#8220;Company&#8221; shall refer instead to the Successor Entity), and may exercise every right and power of the Company and shall assume all of the obligations of the Company under this Warrant with the same effect as if such Successor Entity had been named as the Company herein.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak4d24c721-32f8-4bfa-9861-1c079214b808" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">10</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">e) <u>Calculations</u>. All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be. For purposes of this Section 3, the number of Common Shares deemed to be issued and outstanding as of a given date shall be the sum of the number of Common Shares (excluding treasury shares, if any) issued and outstanding.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">f) <u>Notice to Holder</u>. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1.5in; TEXT-INDENT: 45px" align="justify">i. <u>Adjustment to Exercise Price</u>. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company shall promptly deliver to the Holder by facsimile or email a notice setting forth the Exercise Price after such adjustment and any resulting adjustment to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment. </p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1.5in; TEXT-INDENT: 45px" align="justify">ii. <u>Notice to Allow Exercise by Holder</u>. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on the Common Shares, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Shares, (C) the Company shall authorize the granting to all holders of the Common Shares rights or warrants to subscribe for or purchase any shares of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required in connection with any reclassification of the Common Shares, any consolidation or merger to which the Company is a party, any sale or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Shares are converted into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be delivered by facsimile or email to the Holder at its last facsimile number or email address as it shall appear upon the Warrant Register of the Company, at least 20 calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Common Shares of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Common Shares of record shall be entitled to exchange their Common Shares for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to be specified in such notice. To the extent that any notice provided in this Warrant constitutes, or contains, material, non-public information regarding the Company or any of the Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 6-K. The Holder shall remain entitled to exercise this Warrant during the period commencing on the date of such notice to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreakcae55dbe-8e0a-4a4f-bb30-fa856ad5cfcd" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">11</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0.5in" align="justify"><u>Section 4</u>. <u>Transfer of Warrant</u>.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">a) <u>Transferability</u>. This Warrant and all rights hereunder (including, without limitation, any registration rights) are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company or its designated agent, together with a written assignment of this Warrant substantially in the form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees, as applicable, and in the denomination or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this Warrant to the Company within three (3) Trading Days of the date on which the Holder delivers an assignment form to the Company assigning this Warrant in full. The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">b) <u>New Warrants</u>. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the initial issuance date of this Warrant and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak8cd262b5-0e95-44f8-b7bc-ffc215ae78eb" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">12</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">c) <u>Warrant Register</u>. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the &#8220;<u>Warrant Register</u>&#8221;), in the name of the record Holder hereof from time to time. The Company may deem and treat the registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for all other purposes, absent actual notice to the contrary.<u></u></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 0.5in" align="justify"><u>Section 5</u>. <u>Miscellaneous</u>.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">a) <u>No Rights as Stockholder Until Exercise</u>. This Warrant does not entitle the Holder to any voting rights, dividends or other rights as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except as expressly set forth in Section 3. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">b) <u>Loss, Theft, Destruction or Mutilation of Warrant</u>. The Company covenants that upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or stock certificate.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">c) <u>Saturdays, Sundays, Holidays, etc</u>. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Business Day, then, such action may be taken or such right may be exercised on the next succeeding Business Day.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak85e895f3-c09a-4438-ba7b-b20f3830e54f" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">13</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">d) <u>Authorized Shares</u>. </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 1in" align="justify">The Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Shares a sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant. The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged with the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any applicable law or regulation, or of any requirements of the Trading Market upon which the Common Shares may be listed. The Company covenants that all Warrant Shares which may be issued upon the exercise of the purchase rights represented by this Warrant will, upon exercise of the purchase rights represented by this Warrant and payment for such Warrant Shares in accordance herewith, be duly authorized, validly issued, fully paid and nonassessable and free from all taxes, liens and charges created by the Company in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously with such issue). </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 0.5in" align="justify">Except and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting the generality of the foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount payable therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this Warrant.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1in; TEXT-INDENT: 0.5in" align="justify">Before taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or bodies having jurisdiction thereof.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreakbe30b118-6a53-49ae-956c-37d75a86fdd3" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">14</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">e) <u>Governing Law</u>. All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof. Each party agrees that all legal proceedings concerning the interpretations, enforcement and defense of the transactions contemplated by this Warrant (whether brought against a party hereto or their respective affiliates, directors, officers, shareholders, partners, members, employees or agents) shall be commenced exclusively in the state and federal courts sitting in the City of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the City of New York, Borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is improper or is an inconvenient venue for such proceeding. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Warrant and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law. If either party shall commence an action, suit or proceeding to enforce any provisions of this Warrant, the prevailing party in such action, suit or proceeding shall be reimbursed by the other party for their reasonable attorneys&#8217; fees and other costs and expenses incurred with the investigation, preparation and prosecution of such action or proceeding.<u></u></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">f) <u>Restrictions</u>. The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, and the Holder does not utilize cashless exercise, will have restrictions upon resale imposed by state and federal securities laws.<u></u></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">g) <u>Nonwaiver and Expenses</u>. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as a waiver of such right or otherwise prejudice the Holder&#8217;s rights, powers or remedies. Without limiting any other provision of this Warrant, if the Company willfully and knowingly fails to comply with any provision of this Warrant, which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys&#8217; fees, including those of appellate proceedings, incurred by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.<u></u></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">h) <u>Notices</u>. Any and all notices or other communications or deliveries to be provided by the Holders hereunder including, without limitation, any Notice of Exercise, shall be in writing and delivered personally, by facsimile or e-mail, or sent by a nationally recognized overnight courier service, addressed to the Company, at Suite 900 &#8211; 570 Granville Street, Vancouver, BC, V6C 3P1, Attention: David Wolfin, President, facsimile number: (604) 682-3600, email address: dwolfin@avino.com, or such other facsimile number, email address or address as the Company may specify for such purposes by notice to the Holders. Any and all notices or other communications or deliveries to be provided by the Company hereunder shall be in writing and delivered personally, by facsimile or e-mail, or sent by a nationally recognized overnight courier service addressed to each Holder at the facsimile number, e-mail address or address of such Holder appearing on the books of the Company. Any notice or other communication or deliveries hereunder shall be deemed given and effective on the earliest of (i) the time of transmission, if such notice or communication is delivered via facsimile at the facsimile number or via e-mail at the e-mail address set forth in this Section prior to 5:30 p.m. (New York City time) on any date, (ii) the next Trading Day after the time of transmission, if such notice or communication is delivered via facsimile at the facsimile number or via e-mail at the e-mail address set forth in this Section on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (iii) the second Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service, or (iv) upon actual receipt by the party to whom such notice is required to be given. To the extent that any notice provided hereunder constitutes, or contains, material, non-public information regarding the Company or any subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 6-K.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak0a1c3010-efd5-41a1-933a-34fc4470d776" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">15</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">i) <u>Limitation of Liability</u>. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder for the purchase price of any Common Shares or as a stockholder of the Company, whether such liability is asserted by the Company or by creditors of the Company.<u></u></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">j) <u>Remedies</u>. The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert the defense in any action for specific performance that a remedy at law would be adequate.<u></u></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">k) <u>Successors and Assigns</u>. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall be enforceable by the Holder or holder of Warrant Shares.<u></u></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">l) <u>Amendment</u>. This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company, on the one hand, and the Holder, on the other hand.<u></u></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">m) <u>Severability</u>. Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant.<u></u></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0.5in; TEXT-INDENT: 0.5in" align="justify">n) <u>Headings</u>. The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.<u></u></p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="center">********************</p> <p style="MARGIN: 0px" align="center">&nbsp;</p> <p style="MARGIN: 0px" align="center"><i>(Signature Page Follows)</i></p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="justify"> <table id="pagebreak77fae3a4-6dc9-422a-a6cf-e395eaa13124" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">16</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 1in" align="justify">IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above indicated.</p> <p style="MARGIN: 0px">&nbsp;</p> <table style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr height="15"> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td colspan="2"> <p style="MARGIN: 0px"><b><b>AVINO SILVER &amp; GOLD MINES LTD.</b></b></p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr height="15"> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td colspan="2"> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr height="15"> <td width="50%"> <p style="MARGIN: 0px">&nbsp;</p></td> <td width="5%"> <p style="MARGIN: 0px">By:</p></td> <td style="BORDER-BOTTOM: black 1px solid" valign="top" width="35%"> <p style="MARGIN: 0px">&nbsp;</p></td> <td width="10%"> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr height="15"> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">Name:</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr height="15"> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">Title:</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr></table> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreak1113efb2-8085-497a-ad8b-af912119935e" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">17</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="center"><b>NOTICE OF EXERCISE</b></p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="justify"> <table style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td valign="top" width="4%">TO:</td> <td valign="top">AVINO SILVER &amp; GOLD MINES LTD.</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 1in" align="justify">(1) The undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 1in" align="justify">(2) Payment shall take the form of (check applicable box):</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1.5in; TEXT-INDENT: 0in" align="justify">[ ] in lawful money of the United States; or</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 1.5in; TEXT-INDENT: 0in" align="justify">[ ] if permitted the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 2(c), to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in subsection 2(c).</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in; TEXT-INDENT: 1in" align="justify">(3) Please issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="center">_______________________________</p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="justify">The Warrant Shares shall be delivered to the following DWAC Account Number:</p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="center">_______________________________</p> <p style="MARGIN: 0px" align="center">&nbsp;</p> <p style="MARGIN: 0px" align="center">_______________________________</p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="center">_______________________________</p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="justify">[SIGNATURE OF HOLDER]</p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="justify">Name of Investing Entity: ________________________________________________________________________</p> <p style="MARGIN: 0px" align="justify"><i>Signature of Authorized Signatory of Investing Entity</i>: _________________________________________________</p> <p style="MARGIN: 0px" align="justify">Name of Authorized Signatory: ___________________________________________________________________</p> <p style="MARGIN: 0px" align="justify">Title of Authorized Signatory: ____________________________________________________________________</p> <p style="MARGIN: 0px" align="justify">Date: ________________________________________________________________________________________</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table id="pagebreakca88b331-a650-4e0b-9593-60c4d73134f2" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid">&nbsp;</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="center"><b>ASSIGNMENT FORM</b></p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify"><i>(To assign the foregoing Warrant, execute this form and supply required information. Do not use this form to purchase shares.)</i></p> <p style="MARGIN: 0px; TEXT-INDENT: 45px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to</p> <p style="MARGIN: 0px">&nbsp;</p> <table style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr height="15"> <td valign="top" width="45%"> <p style="MARGIN: 0px" align="justify">Name:</p></td> <td style="BORDER-BOTTOM: black 1px solid" valign="top" width="35%">&nbsp;</td> <td width="20%"> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr height="15"> <td valign="top"> <p style="MARGIN: 0px">&nbsp;</p></td> <td valign="top"> <p style="MARGIN: 0px" align="justify">(Please Print)</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr height="15"> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr height="15"> <td valign="top"> <p style="MARGIN: 0px" align="justify">Address:</p></td> <td style="BORDER-BOTTOM: black 1px solid" valign="top"></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr height="15"> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">(Please Print)</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr height="15"> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr height="15"> <td> <p style="MARGIN: 0px">Phone Number:</p></td> <td style="BORDER-BOTTOM: black 1px solid"> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr height="15"> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr height="15"> <td> <p style="MARGIN: 0px">Email Address:</p></td> <td style="BORDER-BOTTOM: black 1px solid"> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr height="15"> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr height="15"> <td valign="top"> <p style="MARGIN: 0px" align="justify">Dated: _______________ ___, _______</p></td> <td valign="top"> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr height="15"> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr height="15"> <td valign="top"> <p style="MARGIN: 0px" align="justify">Holder&#8217;s Signature: ______________________________</p></td> <td valign="top"> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr height="15"> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr height="15"> <td valign="top"> <p style="MARGIN: 0px" align="justify">Holder&#8217;s Address: _______________________________</p></td> <td valign="top"></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr></table> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cols="1" cellpadding="0" width="100%" align="center" border="0"> <tr> <td style="BORDER-BOTTOM: black 1px solid"> <p style="MARGIN: 0px" align="center">&nbsp;</p></td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p></BODY><!--Document Created by EDGARMaster--></html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-5.1
<SEQUENCE>4
<FILENAME>avino_ex51.htm
<DESCRIPTION>OPINION OF SALLEY BOWES HARWARDT LAW CORP
<TEXT>
<html><head><title>avino_ex51.htm</title><!--Document Created by EDGARMaster--></head><BODY spellcheck="true" style="text-align:justify;font:10pt TIMES NEW ROMAN;margin:0px 7%"><p style="MARGIN: 0px" align="right"><b>EXHIBIT 5.1</b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="center"><font size="3"><font size="6">S</font>ALLEY <font size="6">B</font>OWES <font size="6">H</font>ARWARDT <font size="5">L</font>AW <font size="5">C</font>ORP.</font></p> <p style="MARGIN: 0px" align="center">BARRISTERS AND SOLICITORS</p> <p style="MARGIN: 0px" align="center">Suite 1750 - 1185 West Georgia Street</p> <p style="MARGIN: 0px" align="center">Vancouver, B.C., Canada</p> <p style="MARGIN: 0px" align="center">V6E 4E6</p> <p style="MARGIN: 0px" align="left">&nbsp;</p> <p style="MARGIN: 0px" align="center">Telephone: (604) 688-0788</p> <p style="MARGIN: 0px" align="center">Fax: (604) 688-0778</p> <p style="MARGIN: 0px" align="center">Website: www.sbh.bc.ca</p> <p style="MARGIN: 0px" align="left">&nbsp;</p> <p style="MARGIN: 0px">September 21, 2018</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px">Board of Directors</p> <p style="MARGIN: 0px">Avino Silver &amp; Gold Mines Ltd.</p> <p style="MARGIN: 0px">Suite 900 &#8211; 570 Granville Street</p> <p style="MARGIN: 0px">Vancouver, British Columbia</p> <p style="MARGIN: 0px">V6C 3P1</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px">Dear Sirs:</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"> <table style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cols="2" cellpadding="0" width="100%" align="center" border="0"> <tr> <td valign="top" width="4%"> <p style="MARGIN: 0px">Re:</p></td> <td> <p style="MARGIN: 0px"><b>Avino Silver &amp; Gold Mines Ltd.</b> (the &#8220;Company&#8221;)</p></td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">We have acted as British Columbia counsel for the Company, a British Columbia company. We are furnishing this opinion in connection with a prospectus supplement dated September 21, 2018 (the &#8220;Prospectus Supplement&#8221;), for the issuance of 7,175,846 common shares (&#8220;Common Shares&#8221;), warrants to purchase up to 7,175,846 common shares (the &#8220;Warrants&#8221;), which includes any over-allotment, and the common shares that are issuable from time to time upon exercise of the Warrants (the &#8220;Warrant Shares&#8221;, and together with the Common Shares and Warrants &#8220;the Units&#8221;). The Common Shares and the Warrants will be sold in fixed combination, and the combined purchase price per Common Share and a Warrant is $0.65. Each whole Warrant is exercisable to purchase one additional Common Share at an exercise price of $0.80 per Common Share for a period of five years from the date of closing. The offering will be distributed pursuant to the Underwriting Agreement dated September 21, 2018 (the &#8220;Underwriting Agreement&#8221;) by and between the Company and H.C. Wainwright &amp; Co., LLC, a registration statement on Form F-3, Registration No. 333-226963 (the &#8220;Registration Statement&#8221;), filed by the Company with the Securities and Exchange Commission, including a base prospectus (the &#8220;Base Prospectus&#8221;), and the Prospectus Supplement (together with the Base Prospectus being the &#8220;Prospectus&#8221;).</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">In connection with this opinion, we have examined the Registration Statement and the Prospectus, and such matters of fact and questions of law as we have considered appropriate for purposes of this letter. As to certain factual matters, we have relied upon a Certificate of Officers of even date (the &#8220;Officers&#8217; Certificate&#8221;) executed by the President &amp; Chief Executive Officer, and Secretary of the Company, respectively.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">We are qualified to carry on the practice of law in the Province of British Columbia. Our opinion below is expressed only with respect to the laws of the Province of British Columbia and the federal laws of Canada applicable therein. We express no opinion with respect to the laws of any other jurisdiction.</p> <p style="MARGIN: 0px" align="justify">&nbsp; <table id="pagebreak8be75a3b-3c10-4340-839a-7294c03f2beb" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">1</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">Our opinion is expressed with respect to the laws of the Province of British Columbia in effect on the date of this opinion. We have no responsibility or obligation to (i) update this opinion, (ii) take into account, or inform the addressee or any other person, of any changes in law, facts or other developments subsequent to this date that do or may affect the opinions we express, or (iii) advise the addressee or any other person of any other change in any matter addressed in this opinion. Nor do we have any responsibility or obligation to consider the applicability or correctness of this opinion to any person other than the addressee.</p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">Our opinions expressed herein are based on the following assumptions:</p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="justify"> <table style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td valign="top" width="4%"> <p style="MARGIN: 0px">&nbsp;</p></td> <td valign="top" width="4%">(a)</td> <td valign="top">at or prior to the time of the delivery of the Units, the Registration Statement has become effective under the <i>Securities Act</i> of 1933, as amended (the &#8220;Act&#8221;), and such effectiveness will not have been terminated or rescinded;</td></tr> <tr> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <tr> <td valign="top"> <p style="MARGIN: 0px">&nbsp;</p></td> <td valign="top">(b)</td> <td valign="top">the Units will be offered, issued and sold in compliance with applicable United States Federal and State securities laws and in the manner stated in the Registration Statement and Prospectus; and</td></tr> <tr> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <tr> <td valign="top"> <p style="MARGIN: 0px">&nbsp;</p></td> <td valign="top">(c)</td> <td valign="top">the Company will have received the agreed upon consideration for the issuance of the Units and such Units will have been delivered by or on behalf of the Company against payment therefor.</td></tr></tr></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">Subject to the foregoing and the other matters set forth herein, we are of the opinion that, as of the date hereof:</p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="justify"> <table style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td valign="top" width="4%"> <p style="MARGIN: 0px">&nbsp;</p></td> <td valign="top" width="4%">(a)</td> <td valign="top">each Common Share, when issued, sold and delivered in the manner and for the consideration stated in the Underwriting Agreement upon payment of the consideration provided therein to the Company, will be validly issued, fully paid and non-assessable; and</td></tr> <tr> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <tr> <td valign="top"> <p style="MARGIN: 0px">&nbsp;</p></td> <td valign="top">(b)</td> <td valign="top">each Warrant Share, when issued, sold and delivered in the manner and for the consideration stated in the Warrants upon payment of the consideration provided therein to the Company, will be validly issued, fully paid and non-assessable.</td></tr></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">This opinion letter has been prepared for your use in connection with the Registration Statement and Prospectus contained therein and is expressed as of the date hereof. Our opinion is expressly limited to the matters set forth above and we render no opinion, whether by implication or otherwise, as to any other matters relating to the Company.</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">&nbsp;</p> <p style="MARGIN: 0px; TEXT-INDENT: 45px" align="justify">We hereby consent to the filing of this opinion letter as an exhibit to the Form 6-K which is incorporated by reference to the Registration Statement, and to the reference to this firm on the cover page and under the caption &#8220;Legal Matters&#8221; in the Prospectus. In giving this consent, we do not hereby admit that we are within the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the Commission promulgated thereunder.</p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="justify"> <table style="TEXT-ALIGN: justify; FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cols="3" cellpadding="0" width="100%" align="center" border="0"> <tr> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td width="35%"> <p style="MARGIN: 0px">Yours truly,</p></td> <td width="15%"> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr> <tr> <td> <p style="MARGIN: 0px">&nbsp;</p></td> <td style="BORDER-BOTTOM: black 1px solid"> <p style="MARGIN: 0px"><em>/s/ Salley Bowes Harwardt Law Corp.</em></p></td> <td> <p style="MARGIN: 0px">&nbsp;</p></td></tr></table></p> <p style="MARGIN: 0px">&nbsp; <table class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid; TEXT-ALIGN: center">2</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p></BODY><!--Document Created by EDGARMaster--></html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>5
<FILENAME>avino_ex991.htm
<DESCRIPTION>PRESS RELEASE
<TEXT>
<html><head><title>avino_ex991.htm</title><!--Document Created by EDGARMaster--></head><BODY spellcheck="true" style="text-align:justify;font:10pt TIMES NEW ROMAN;margin:0px 7%"><p style="MARGIN: 0px" align="right"><b>EXHIBIT 99.1</b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="center"><img src="avino_ex991img1.jpg"></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="justify">September 21, 2018 </p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px 0px 0px 0in" align="center"><b>AVINO ANNOUNCES PRICING OF US$4 MILLION UNDERWRITTEN PUBLIC OFFERING</b></p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="justify"><b>Avino Silver &amp; Gold Mines Ltd. (ASM:TSX/NYSE American; FSE:GV6, "Avino" or "the Company")</b> today announced that it has priced an underwritten public offering of an aggregate of 6,239,867 common shares of the Company, together with warrants to purchase up to 6,239,867 common shares of the Company, at a public offering price of US$0.65 per share and associated warrant to purchase one common share. Each warrant will have an exercise price of US$0.80 and will expire five years from the date of issuance.</p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="justify">H.C. Wainwright &amp; Co. is acting as the sole book-running manager for the offering. Roth Capital Partners is acting as co-manager for the offering.</p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="justify">Avino has also granted the underwriters a 45-day option to purchase up to 935,979 additional common shares and/or additional warrants to purchase up to 935,979 common shares, at the public offering price, less underwriting discounts and commissions. The gross proceeds to the Company from this offering are expected to be US$4 million, before deducting the underwriting discounts and commissions and other estimated offering expenses payable by Avino, assuming no exercise of the underwriters&#8217; option to purchase additional securities and none of the warrants issued in this offering are exercised. The offering is expected to close on or about on September 25, 2018, subject to the satisfaction of customary closing conditions, including acceptance of the listing of the common shares by the NYSE American and the Toronto Stock Exchange. </p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="justify">The Company intends to use the net proceeds from the offering primarily for advancing the development of the Avino mine and its operations and production, and to a lesser extent for the exploration and development of the Bralorne Mine Property, and for general working capital.</p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="justify">The shares and warrants are being offered pursuant to an effective shelf registration statement on&nbsp;Form&nbsp;F-3 (File No.&nbsp;333-226963), that was previously filed with the Securities and Exchange Commission (&#8220;SEC&#8221;) and declared effective on September 5, 2018. The securities may be offered only by means of a prospectus. A preliminary prospectus supplement relating to and describing the terms of the offering has been filed with the SEC. A final prospectus supplement and the accompanying prospectus will be filed with the SEC and once filed, will be available on the SEC&#8217;s website at www.sec.gov and may also be obtained from H.C. Wainwright &amp; Co., LLC, 430 Park Avenue, 3<sup>rd</sup> Floor, New York, NY 10022, by calling (646) 975-6996 or emailing placements@hcwco.com. In connection with the offering, the Company intends to rely on the exemptions in Section 602.1 of the Toronto Stock Exchange Company Manual, and the offering is subject to the acceptance of the Toronto Stock Exchange. The Company has also filed a Form 6-K with the SEC describing this offering.</p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="justify">This press release shall not constitute an offer to sell, or the solicitation of an offer to buy, nor may there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.</p> <p style="MARGIN: 0px">&nbsp; <table id="pagebreak4559d655-2a42-4def-9351-253cd0b5779b" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid">&nbsp;</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px" align="center">Page 2</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px"><b>About Avino: </b></p> <p style="MARGIN: 0px" align="justify">Avino is a silver and gold producer with a diversified pipeline of gold, silver and base metals properties in Mexico and Canada employing close to 600 people. Avino produces from its wholly owned Avino and San Gonzalo Mines near Durango, Mexico, and is currently planning for future production at the Bralorne Gold Mine in British Columbia, Canada. The Company&#8217;s gold and silver production remains unhedged. The Company&#8217;s mission and strategy is to create shareholder value through its focus on profitable organic growth at the historic Avino Property near Durango, Mexico, and the strategic acquisition of mineral exploration and mining properties. We are committed to managing all business activities in an environmentally responsible and cost-effective manner, while contributing to the well-being of the communities in which we operate.</p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="justify">On Behalf of the Board</p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="justify"><u><em>&#8220;David Wolfin&#8221;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</em></u></p> <p style="MARGIN: 0px" align="justify">David Wolfin</p> <p style="MARGIN: 0px" align="justify">President &amp; CEO</p> <p style="MARGIN: 0px" align="justify">Avino Silver &amp; Gold Mines Ltd.</p> <p style="MARGIN: 0px" align="justify">&nbsp; <table id="pagebreak4dd3ba71-e563-4600-899a-d39024333471" class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid">&nbsp;</td></tr> <tr> <td> <div style="WIDTH: 100%; PAGE-BREAK-AFTER: always; LINE-HEIGHT: 0px"></div>&nbsp;</td></tr> <tr> <td>&nbsp;</td></tr></table></p> <p style="MARGIN: 0px" align="center">Page 3</p> <p style="MARGIN: 0px">&nbsp;</p> <p style="MARGIN: 0px" align="justify">This news release contains &#8220;forward-looking information&#8221; and &#8220;forward-looking statements&#8221; (together, the &#8220;forward looking statements&#8221;) within the meaning of applicable securities laws and the United States Private Securities Litigation Reform Act of 1995. These forward-looking statements are made as of the date of this news release and include, but is not limited to, that the offering will close. . Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the future circumstances, outcomes or results anticipated in or implied by such forward-looking statements will occur or that plans, intentions or expectations upon which the forward-looking statements are based will occur. While we have based these forward-looking statements on our expectations about future events as at the date that such statements were prepared, the statements are not a guarantee that such future events will occur and are subject to risks, uncertainties, assumptions and other factors which could cause events or outcomes to differ materially from those expressed or implied by such forward-looking statements.</p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="justify">Such factors and assumptions include, among others, the effects of general economic conditions; the price of gold, silver and copper; changing foreign exchange rates and actions by government authorities; uncertainties associated with legal proceedings and negotiations; and misjudgments in the course of preparing forward-looking information. In addition, there are known and unknown risk factors which could cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by the forward-looking statements. Known risk factors include risks associated with project development; the need for additional financing; operational risks associated with mining and mineral processing; fluctuations in metal prices; title matters; uncertainties and risks related to carrying on business in foreign countries; environmental liability claims and insurance; reliance on key personnel; the potential for conflicts of interest among certain of our officers, directors or promoters with certain other projects; the absence of dividends; currency fluctuations; competition; dilution; the volatility of the our common share price and volume; and other risks and uncertainties. Although we have attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. We are under no obligation to update or alter any forward-looking statements except as required under applicable securities laws.</p> <p style="MARGIN: 0px" align="justify">&nbsp;</p> <p style="MARGIN: 0px" align="justify">Neither the TSX nor its Regulation Services Provider (as that term is defined in the policies of the TSX) accepts responsibility for the adequacy or accuracy of this release.</p> <p style="MARGIN: 0px" align="justify">&nbsp; <table class="pagebreak" style="FONT: 10pt TIMES NEW ROMAN" cellspacing="0" cellpadding="0" width="100%" border="0"> <tr> <td class="hpbhr">&nbsp;</td></tr> <tr> <td style="BORDER-BOTTOM: black 1px solid">&nbsp;</td></tr></table></p> <p style="MARGIN: 0px">&nbsp;</p></BODY><!--Document Created by EDGARMaster--></html>
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</DOCUMENT>
</SEC-DOCUMENT>
