McFarlane Lake Mining Limited — M&A Activity 2022

Jan 15, 2022

EXECUTION VERSION

BUSINESS COMBINATION AGREEMENT

BETWEEN

1287401 B.C. LTD.

AND

1000034047 ONTARIO INC.

AND

MCFARLANE LAKE MINING INCORPORATED

MADE AS OF JANUARY 12, 2022

ARTICLE	1 INTERPRETATION1
1.01	Defined Terms1
1.02	Headings10
1.03	Extended Meanings10
1.04	Statutory References10
1.05	Accounting Principles11
1.06	Currency11
1.07	Schedules11
ARTICLE	2 BUSINESS COMBINATION11
2.01	Business Combination11
2.02	Dissent Rights14
ARTICLE	3 REPRESENTATIONS AND WARRANTIES OF MCFARLANE15
3.01	Incorporation and Registration15
3.02	Subsidiaries15
3.03	Bankruptcy, etc.15
3.04	Due Authorization, etc15
3.05	[intentionally deleted]16
3.06	Absence of Conflict16
3.07	Capital Stock16
3.08	Options and Other Convertible Securities16
3.09	No Pre-Emptive Rights16
3.10	No Shareholders/Voting Agreement17
3.11	Financial Statements17
3.12	Absence of Changes17
3.13	Internal Controls Over Financial Reporting17
3.14	No Restrictions on Activities17
3.15	Mining Matters18
3.16	Extent of Liabilities20
3.17	Non-Arm's Length Transactions20
3.18	No Guarantees20
3.19	Owned Real Property20
3.20	McFarlane Material Contracts20
3.21	Other Contracts21
3.22	Taxes and Governmental Charges21
3.23	Environmental Matters22
3.24	Absence of Litigation, etc22
3.25	Compliance with Laws22
3.26	Authorizations and Consents23
3.27	Employment Matters and Employee Plans23
3.28	No Powers of Attorney24

4.01	Incorporation25
4.02	Subsidiaries26
4.03	Bankruptcy, etc.26
4.04	Due Authorization, etc26
4.05	Absence of Conflict26
4.06	Capital Stock27
4.07	Options and Other Convertible Securities27
4.08	Financial Statements27
4.09	Absence of Changes27
4.10	Internal Controls Over Financial Reporting27
4.11	Ordinary Course28
4.12	No Restrictions on Activities28
4.13	Liabilities28
4.14	Non-Arm's Length Transactions28
4.15	No Guarantees28
4.16	128 Material Contracts28
4.17	Other Contracts29
4.18	Title to Property and Assets29
4.19	Taxes and Governmental Charges29
4.20	Absence ofLitigation, etc30
4.21	Compliance with Laws30
4.22	Authorizations and Consents30
4.23	Employment Matters and Employee Plans30
4.24	No Powers of Attorney31
4.25	Insurance31
4.26	Authorizations31
4.27	Fees and Commissions32
4.28	Books and Records32
4.29	Restrictions on Business Combination32
4.30	Reporting Issuer Status32
4.31	Expenses and Obligations32
4.32	Share Issuance32
4.33	Public Disclosure Documents33
4.34	No Misrepresentation33
4.35	Information Supplied33

5.01	Survival of Covenants, Representations and Warranties33
ARTICLE	6 COVENANTS33
6.01	Access to McFarlane33
6.02	Access to 12834
6.03	Confidentiality34
6.04	Filings and Indemnification36
6.05	Conduct of McFarlane Prior to Closing36
6.06	Conduct of 128 Prior to Closing39
6.07	Standstill of McFarlane41
6.08	Standstill of 12842
6.09	Change to Directors and Officers of 12842
ARTICLE	7 CONDITIONS OF CLOSING43
7.01	Conditions in Favour of 12843
7.02	Conditions in Favour of McFarlane44
7.03	Filing Articles46
7.04	FurtherAssurances46
ARTICLE	8 TERMINATION46
8.01	Termination46
8.02	Effectof Termination47
8.03	Waivers and Extensions48
ARTICLE	9 MISCELLANEOUS48

9.01	Further Assurances48
9.02	Transaction Costs48
9.03	Time of the Essence48
9.04	Public Announcements48
9.05	Benefit of the Agreement48
9.06	Entire Agreement49
9.07	Amendments and Waivers49
9.08	Assignment49
9.09	Notices49
9.10	Remedies Cumulative50
9.11	Governing Law50
9.12	Attornment50
9.13	Counterparts50
9.14	Electronic Execution51

SCHEDULES

• Schedule "A" Amalgamation Agreement Schedule "B" – McFarlane Disclosure Schedule
• Schedule "C" 128 Disclosure Schedule

BUSINESS COMBINATION AGREEMENT

THIS AGREEMENT is made as of January 12, 2022

B E T W E E N:

1287401 B.C LTD., a corporation incorporated under the laws of the Province of British Columbia,

(hereinafter called "128"),

• and -

1000034047 ONTARIO INC., a corporation incorporated under the laws of the Province of Ontario,

(hereinafter called "Subco"),

• and -

MCFARLANE LAKE MINING INCORPORATED, a corporation incorporated under the laws of the Province of Ontario,

(hereinafter called "McFarlane"),

WHEREAS pursuant to the Letter of Intent (as defined herein), 128 and McFarlane propose to combine the business and assets of 128 with those of McFarlane and upon completion of such business combination, 128 will become the Resulting Issuer (as defined herein), a mineral exploration company with the name "McFarlane Lake Mining Limited" or such other similar name as may be accepted by the relevant regulatory authorities and approved by the board of directors of the Resulting Issuer;

AND WHEREAS the parties intend to carry out the proposed business combination whereby 128 will acquire all of the issued and outstanding shares of McFarlane by means of a three-cornered amalgamation among 128, McFarlane and Subco under the provisions of the OBCA (as defined herein) and related transaction steps;

NOW THEREFORE, in consideration of the covenants and agreements herein contained, the parties agree as follows:

ARTICLE 1 INTERPRETATION

1.01 Defined Terms

In this Agreement, unless something in the subject matter or context is inconsistent therewith:

"128" means 1287401 B.C. Ltd., a corporation incorporated under the BCBCA;

"128 Continuation Resolution" means the written resolution of all of the shareholders of 128 authorizing the continuation of 128 from British Columbia to Ontario;

"128 Disclosure Schedule" means the disclosure schedule attached as Schedule "C" to this Agreement;

"128 Financial Statements" means the audited financial statements of 128 from the period of incorporation on February 3, 2021 to June 30, 2021 and the unaudited condensed interim consolidated financial statements of 401 for three months ended September 30, 2021;

"128 Listing" means the listing of the Resulting Issuer Shares on the Exchange;

"128 Material Adverse Effect" means any fact or state of facts, circumstance, effect, occurrence or event that individually or in the aggregate is, or could reasonably be expected to, have a material adverse effect on (i) the business, assets, liabilities, condition (financial or otherwise), management, results of operations or shareholders' equity of 128, or (ii) the ability of Subco to complete the Amalgamation, or (iii) the ability of 128 to complete the Amalgamation and the Business Combination; provided, however, that this will not include any fact, circumstance, event, change, effect, or occurrence relating to: (A) the global economy or securities markets in general; (B) changes in general economic conditions in Canada or any country or region in the world, or changes in conditions in the global economy generally; (C) changes in conditions in the financial markets, credit markets or capital markets in Canada or any other country or region in the world; (D) changes in political conditions in Canada or any other country or region in the world; (E) acts of war, sabotage or terrorism (including any escalation or general worsening of any such acts of war, sabotage or terrorism) in Canada or any other country or region in the world; (F) earthquakes, hurricanes, tsunamis, tornadoes, floods, mudslides, wild fires or other natural disasters, weather conditions and other force majeure events in Canada or any other country or region in the world; (G) the announcement of this Agreement or the pendency of consummation of the transactions contemplated hereby; (H) compliance with the terms of, or the taking of any action required or contemplated by, this Agreement or the failure to take any action prohibited by this Agreement; (I) any actions or failure to take action, in each case, to which McFarlane has in writing expressly approved, consented to or requested; or (J) changes in Laws, Taxes, IFRS or other legal or regulatory conditions (or the interpretation thereof);

"128 Name Change" means the change of 128's name to "McFarlane Lake Mining Limited", orsuch other name as is acceptable to McFarlane and the Director;

"128 Ordinary Course" means, with respect to any actions taken by 128, that such action is consistent with past practices;

"128 Shareholder" means a registered holder of 128 Shares;

"128 Share Split" means the split of the outstanding securities of 128 on the basis of 1.20967742 post-split 128 Shares for each one pre-split 128 Share, completed on December 13, 2021;

"128 Shares" means common shares in the capital of 128;

"Accredited Investor" means an "accredited investor" within the meaning of Rule 501(a) of Regulation D under the U.S. Securities Act;

"Affiliate" of any Person means, at the time such determination is being made, any other Person who has control or who is controlled by or under common control with such first Person, where "control"

means the possession, directly or indirectly, of the power to direct the management and policies of a Person through the legal or beneficial ownership of voting securities, the right to appoint directors or management, by contract, voting trust, or otherwise; and the terms "controlling" and "controlled" have meanings correlative to the foregoing;

"Agreement" means this agreement, including its recitals and schedules, as amended from time to time;

"Amalco" has the meaning set out in Section 2.01(e);

"Amalco Shares" means common shares in the capital of Amalco;

"Amalgamation" means the amalgamation of McFarlane and Subco pursuant to section 174 of the OBCA as contemplated by this Agreement;

"Amalgamation Agreement" means the amalgamation agreementsubstantially in the form attached hereto as Schedule "A" to be entered into between 128, McFarlane and Subco pursuant to section 175 of the OBCA to effect the Amalgamation;

"Applicable Party" is defined in the definition of "Employee Plans";

"Articles of Amalgamation" means the articles of Amalgamation to be filed with the Director, in the form agreed to between 128 and McFarlane, each acting reasonably;

"Assets" means the assets, undertaking, property and rights of McFarlane of every kind and description and wheresoever situated, including the Contracts to which McFarlane is a party or has rights or obligations under and all other assets and property that McFarlane purports to own and all assets and property reflected as being owned by McFarlane in its respective financial books and records;

"Authorization" means any order, permit, approval, consent, waiver, license, certificates, registrations or similar authorization of any Governmental Authority having jurisdiction including, but not limited to, environmental permits;

"BCBCA" means the Business Corporations Act (British Columbia) as amended;

"Board Change" means the appointment of the new members to the board of directors of the Resulting Issuer;

"Business Combination" means the business combination among 128, Subco and McFarlane pursuant to which, among other things, McFarlane Common Shareholders will receive that number of 128 Shares equal to the number of McFarlane Common Shares held by such holder multiplied by the Exchange Ratio and pursuant to which 128 will become the parent company of Amalco and complete the 128 Listing;

"Business Day" means a day other than a Saturday, Sunday or statutory holiday in Toronto, Ontario;

"Canadian Jurisdictions" means each of the provinces of British Columbia and Alberta;

"Canadian Securities Laws" means all applicable securities Laws in each of the Canadian Jurisdictions and the respective rules and regulations made thereunder, together with applicable published policy statements, instruments, orders and rulings of the securities regulatory authorities in such provinces having the force of law;

"CSM" means Canadian Star Minerals Ltd.;

"CSM Consideration Shares" means the 5,625,000 McFarlane Shares or Resulting Issuer Shares, as the case may be, issuable to CSM in connection with the purchase of the McFarlane Mineral Properties;

"CSM Right of First Refusal" means the right of first refusal to purchase up to $1,687,500 of securities of the Resulting Issuer granted to CSM pursuant to terms and conditions set out in the Canadian Star Right of First Refusal Agreement;

"CSM Right of First Refusal Agreement" means the agreement dated effective December 30, 2021 pursuant to which the CSM Right of First Refusal was granted to CSM;

"Closing Date" means the closing date of the Business Combination, being January 14, 2022, or such other date as may be approved by both 128 and McFarlane;

"Compelled Disclosure" has the meaning set out in Section 6.03(d)(ii);

"Compensation Plan" means the stock and incentive compensation plan of the Resulting Issuer;

"Confidential Information" has the meaning set out in Section 6.03(a);

"Constating Documents" means, in respect of a body corporate, the articles and the by-laws, or other charter documents, together with any amendments thereto or replacements thereof;

"Contaminants" means any radioactive materials, asbestos materials, urea formaldehyde, hydrocarbon contaminants, underground or above-ground tanks, pollutants, contaminants, deleterious substances, dangerous substances or goods, hazardous, corrosive, or toxic substances, special waste or waste of any kind, or any other substance, the storage, manufacture, disposal, treatment, generation, use, transport, remediation, or Release into the environment which is prohibited, controlled, or regulated under Environmental Laws;

"Contract" means any agreement, contract, licence, undertaking, option, engagement, or commitment of any nature, written or oral, including any: (i) lease of personal property, (ii) unfilled purchase order, (iii) forward commitment for supplies or materials or other forward contract, (iv) derivative contract and (v) restrictive agreement or negative covenant agreement;

"Definitive Property Purchase Agreement" means the mineral property purchase agreement dated effective December 30, 2021 between Canadian Star Minerals Inc. and McFarlane providing for, among other things, the purchase by McFarlane of the McFarlane Mineral Properties;

"Director" means the Director appointed under the OBCA;

"Disclosing Party" has the meaning set out in Section 6.03(a);

"Dissent Rights" mean the rights of the McFarlane Dissenting Shareholders to dissent under section 185 of the OBCA with respect to the Amalgamation;

"Effective Date" means the effective date set forth in the certificate of amalgamation issued pursuant to the OBCA in respect of the Amalgamation;

"Effective Time" means the earliest moment on the Effective Date;

"Employee Plans" means, with respect to a party to this Agreement (the "Applicable Party"), all employee benefit, fringe benefit, supplemental unemployment benefit, bonus, incentive, profit sharing, termination, change of control, pension, retirement, stock option, stock purchase, stock appreciation, stock award, health, welfare, medical, dental, disability, life insurance and similar plans, programmes, arrangements or practices relating to the current or former directors, officers, or employees of the Applicable Party and its Subsidiaries, maintained, funded or sponsored or required to be contributed to by the Applicable Party or a Subsidiary thereof, whether written or oral, funded or unfunded, insured or self-insured, registered or unregistered, under which the Applicable Party or a Subsidiary thereof may have or would be reasonably expected to have any material Liability, contingent or otherwise, except for any statutory plans to which the Applicable Party or any of its Subsidiaries is obliged to contribute or comply with including the Canada/Québec Pension Plan, or plans administered pursuant to applicable federal or provincial health, worker's compensation or employment insurance legislation;

"Encumbrance" means any mortgage, charge, pledge, hypothecation, security interest, assignment, lien (statutory or otherwise), title retention agreement or arrangement, restrictive covenant or other encumbrance of any nature or any other arrangement or condition that, in substance secures payment or performance of an obligation;

"Environmental Laws" has the meaning set out in Section 3.23;

"Exchange" means the Aequitas NEO Exchange Inc. or any other recognized stock exchange on which the Resulting Issuer Shares are to be listed for trading;

"Exchange Ratio" means 1:1;

"Governmental Authority" means (i) any international, multinational, national, federal, provincial, state, municipal, local or other government or governmental or public ministry, department, court, commission, board, bureau, agency or instrumentality, domestic or foreign, (ii) any subdivision or authority of any of the foregoing, (iii) any quasi-governmental body exercising any regulatory, expropriation or taxing authority, or (iv) any stock exchange or securities market;

"Governmental Charges" means all Taxes, customs, duties, rates, levies, assessments, reassessments and other charges, unemployment insurance contributions, pension plan contributions and any deductions or other amounts which a Person is required by Law or Contract to pay, deduct, withhold, collect or remit to any Governmental Authority or other entities entitled to receive payment of such amounts, together with all penalties, interest and fines with respect thereto, payable to any Governmental Authority;

"IFRS" means International Financial Reporting Standards as issued by the International Accounting Standards Board and as adopted by the Chartered Professional Accounts of Canada;

"knowledge of 128" means the actual knowledge of the Chief Executive Officer of 128, after making due inquiries;

"knowledge of McFarlane" means the actual knowledge of the Chief Executive Officer or the Chief Financial Officer of McFarlane, after making due inquiries;

"Laws" means all laws, by-laws, rules, regulations, orders, ordinances, protocols, codes, instruments, policies, notices, directions and judgments or other requirements having the force of law of any Governmental Authority having jurisdiction over the matter or Person then being referred to;

"Leased Real Property" means lands or premises which are used by McFarlane and which are leased, subleased, licensed to or otherwise occupied by them;

"Letter of Intent" means the letter of intent dated August 13, 2021 between McFarlane and 128, as amended on October 14, 2021 and December 31, 2021, with respect to, among other things, the Business Combination;

"Liability" of any Person means (i) any right against such Person to payment, whether or not such right is reduced to judgment, and whether or not the amount is liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured; (ii) any right against such Person to an equitable remedy for breach of performance if such breach gives rise to a right to payment, whether or not such right to any equitable remedy is reduced to judgment, and whether or not the amount is fixed, contingent, matured, unmatured, disputed, undisputed, secured or unsecured; and (iii) any obligation of such Person for the performance of any covenant or agreement (whether for the payment of money or otherwise);

"Listing Statement" means the listing document to be prepared by 128 and McFarlane in accordance with Exchange listing requirements in respect of the Business Combination;

"Losses", in respect of any matter, means all claims, demands, proceedings, Losses, damages, liabilities, deficiencies, costs and expenses (including, without limitation, all legal and other professional fees and disbursements, interest, penalties and amounts paid in settlement) arising directly or indirectly as a consequence of such matter;

"McFarlane" means McFarlane Lake Mining Incorporated, a corporation incorporated under the OBCA;

"McFarlane Broker Warrants" means the broker warrants issued to certain brokers in connection with the McFarlane Private Placement;

"McFarlane Business" means the business of McFarlane, as more particularly described in the Listing Statement;

"McFarlane Common Shareholder" means a registered holder of McFarlane Common Shares;

"McFarlane Common Shareholder Approval" has the meaning set forth in Section 2.01;

"McFarlane Common Shares" means the common shares in the capital of McFarlane;

"McFarlane Disclosure Schedule" means the disclosure schedule attached as Schedule "B" to this Agreement;

"McFarlane Dissent Procedures" means the dissent procedures provided to McFarlane Common Shareholders pursuant to section 185 of the OBCA;

"McFarlane Dissenting Shareholder" means a registered McFarlane Common Shareholder who exercises Dissent Rights in respect of the Amalgamation in strict compliance with the McFarlane Dissent Procedures;

"McFarlane Financial Statements" means the audited consolidated financial statements of McFarlane for the annual period ended August 31, 2021 and for the period from the date of incorporation (August 20, 2020) to August 31, 2020;

"McFarlane Flow-Through Shares"means the McFarlane Common Shares issued as "flow-through shares" within the meaning of the Tax Act as part of the McFarlane Private Placement;

"McFarlane Material Adverse Effect" means any fact or state of facts, circumstance, effect, occurrence or event that individually or in the aggregate is, or could reasonably be expected to, have a material adverse effect on (i) the business, assets, liabilities, condition (financial or otherwise), management, results of operations or shareholders' equity of McFarlane, or (ii) the ability of McFarlane to complete the Business Combination and the Amalgamation; provided, however, that this will not include any fact, circumstance, event, change, effect, or occurrence: (A) relating to the global economy or securities markets in general; (B) relating to or affecting the mining industry in general, including the promulgation of laws or regulations affecting mining, and which does not have a materially disproportionate effect on McFarlane; (C) relating to changes in general economic conditions in Canada or any country or region in the world, or changes in conditions in the global economy generally (to the extent that such effect has not had a disproportionate effect on McFarlane relative to other companies in the industries in which it carries on business); (D) relating to changes in conditions in the financial markets, credit markets or capital markets in Canada or any other country or region in the world; (E) relating to changes in political conditions in Canada or any other country or region in the world (to the extent that such effect has not had a disproportionate impact on McFarlane relative to other companies in the industries in which McFarlane carries on business); (F) relating to acts of war, sabotage or terrorism (including any escalation or general worsening of any such acts of war, sabotage or terrorism) in Canada or any other country or region in the world (to the extent such effect has not had a disproportionate impact on McFarlane relative to other companies in the industries in which McFarlane carries on business); (G) relating to earthquakes, hurricanes, tsunamis, tornadoes, floods, mudslides, wild fires or other natural disasters, weather conditions and other force majeure events in Canada or any other country or region in the world (to the extent such effect has not had a disproportionate impact on McFarlane relative to other companies in the industries in which McFarlane carries on business); (H) relating to the announcement of this Agreement or the pendency of consummation of the transactions contemplated hereby; (I) relating to compliance with the terms of, or the taking of any action required or contemplated by, this Agreement or the failure to take any action prohibited by this Agreement; (J) relating to any actions or failure to take action, in each case, to which 128 has in writing expressly approved, consented to or requested; or (K) relating to changes in Law, Taxes, IFRS or other legal or regulatory conditions (or the interpretation thereof) (to the extent such change has not had a disproportionate impact on McFarlane relative to other companies in the industries in which McFarlane carries on business);

"McFarlane Material Contracts" means (i) every Contract to which McFarlane is a party requiring payment by or to McFarlane of an amount in any one year in the aggregate of $50,000; (ii) every Contract to which McFarlane is a party that has or would reasonably be expected to have any material direct or indirect effect (by license, assignment or otherwise) on the Assets or the McFarlane Business; and (iii) every Contract to which McFarlane is a party with any directors, officers, shareholders, consultants or key employees of McFarlane, but excluding employment contracts;

"McFarlane Meeting" means the special meeting of the holders of McFarlaneCommon Shares to be held to obtain the McFarlane Common Shareholder Approval, and any and all adjournments or postponements of such meeting;

"McFarlane Mineral Properties" includes the High Lake Property, the West Hawk Lake Property and the McMillan Mine properties described in greater detail in the McFarlane Disclosure Schedule;

"McFarlane Notice" means the notice of special meeting of shareholders of McFarlane to be sent to the McFarlane Common Shareholders in respect of the McFarlane Meeting;

"McFarlane Options" means the 5,500,000 stock options outstanding as of the date hereof issued pursuant to McFarlane's stock option plan;

"McFarlane Ordinary Course" means, with respect to any actions taken by McFarlane that such action is consistent in carrying out the McFarlane Business;

"McFarlane Private Placement" means the brokered private placement of McFarlane Flow-Through Shares and McFarlane Units on December 9, 2021;

"McFarlane Unit" means a unit of McFarlane comprised of one McFarlane Common Share and one half of one McFarlane Warrant;

"McFarlane Warrants" means the warrantsto acquire McFarlaneCommon Shares outstanding as of the date hereof, as set out in Section 1.01 of the McFarlane Disclosure Schedule;

"North Consulting Agreement" means the consulting services agreement between 1873344 Ontario Limited, Christopher North and McFarlane dated effective December 30, 2021 providing for the provision of mineral exploration consulting services to McFarlane;

"OBCA" means the Business Corporations Act (Ontario), as amended;

"Owned Real Property" means real property owned by McFarlane and real property, other than Leased Real Property, in which McFarlane has an ownership interest;

"Permitted Acquisition" means the acquisition of mineral properties by McFarlane in accordance with currently outstanding letters of intent or property acquisition agreements, as disclosed in the McFarlane Disclosure Schedule;

"Permitted Encumbrances" means (i) Encumbrances for Taxes not yet due and delinquent; (ii) inchoate or statutory Encumbrances of contractors, subcontractors, mechanics, workers, suppliers, materialmen, carriers and others in respect of the construction, maintenance, repair or operation of the Assets, provided that such Encumbrances are related to obligations not due or delinquent and in respect of which adequate holdbacks are being maintained as required by Law; (iii) the right reserved to or vested in any Governmental Authority by any statutory provision or by the terms of any lease, licence, franchise, grant or permit of McFarlane, to terminate any such lease, licence, franchise, grant or permit, or to require annual or other payments as a condition of their continuance; and (iv) Encumbrances listed and described in Section 3.02 of the McFarlane Disclosure Schedule;

"Person" means any corporation, partnership, limited liability company or partnership, joint venture, trust, unincorporated association or organization, business, enterprise or other entity; any individual; and any government;

"Public Record" means all information filed or to be filed by or on behalf of 128 after February 3, 2021, and prior to the earlier of the Effective Date or the termination of this Agreement with any securities commission or regulatory authority in compliance, or intended compliance, with the continuous disclosure obligations applicable to a reporting issuer under applicable Laws;

"Recipient" has the meaning set out in Section 6.03(a);

"Release" includes any release, spill, leak, pumping, pouring, emission, emptying, discharge, injection, escape, leaching, migration, disposal or dumping;

"Representatives" has the meaning set out in Section 6.03(a);

"Resulting Issuer" means 128 at the Effective Date which, following completion of the Transactions, will be a mineral exploration company and renamed "McFarlane Lake Mining Limited" or such other similar name as may be acceptable to McFarlane and by the relevant regulatory authorities;

"Resulting Issuer Replacement Broker Warrants" means broker warrants of 128 to be issued to holders of McFarlane Broker Warrants pursuant to Section 2.01(j);

"Resulting Issuer Replacement Options" means the options to purchase Resulting Issuer Shares to be issued by the Resulting Issuer to holders of McFarlane Options pursuant to Section 2.01(i);

"Resulting Issuer Replacement Warrants" means the warrantsto purchase Resulting Issuer Shares to be issued by the Resulting Issuer to holders of McFarlane Warrants pursuant to Section 2.01(h);

"Resulting Issuer Shares" means common shares in the capital of the Resulting Issuer;

"Subco" means 1000034047 Ontario Inc., a corporation incorporated under the OBCA and, prior to completion of the Subco Private Placement, a wholly-owned subsidiary of 128;

"Subco Common Shares" means the common shares in the capital of Subco;

"Subco Private Placement" means the non-brokered private placement of 65,500 Subco Units at the Subco Unit Price completed on December 9, 2021;

"Subco Unit" means a unit of Subco comprised of one Subco Common Share and one half of one Subco Warrant;

"Subco Unit Price" means $0.40 per Subco Unit;

"Subco Warrants" means the warrants to acquire Subco Common Shares at a price of $0.60 per share for a period of 36 months from the date of issuance, issued pursuant to the Subco Private Placement;

"Subsidiary" means, with respect to a specified body corporate, any body corporate of which the specified body corporate is entitled to elect a majority of the directors thereof or over which the specified body corporate holds more than 50% of the votes for the directors thereof and will include any body corporate, partnership, joint venture or other Person (other than an individual) over which such specified body corporate exercises direction or control or which is in a like relation to such a body corporate;

"Tax" or "Taxes" means, in relation to any Person, any and all taxes, whether or not referred to as taxes, (including any and all fines, interest and penalties in respect thereof) of any nature imposed, levied, withheld or assessed on or with respect to the income, profits, gross receipts, sales, capital, assets, real property, personal property, production, employees, payroll, benefit payments, purchases, payments, receipts or gains of such Person (including, without limitation, any federal or state income, franchise or sales taxes, corporation capital tax, customs or excise duties or municipal license fees, withholding tax and any taxes and other deductions required to be paid or withheld from any payment made to any Person) by Canada or any province thereof, the United States of America or any political subdivision or taxing authority thereof or therein, or by any other country or any political subdivision or taxing authority thereof or therein;

"Tax Act" means the Income Tax Act (Canada), as amended;

"Tax Returns" means all returns, declarations, reports, information returns and statements filed or required to be filed by any taxing authority relating to Taxes;

"Transactions" means the transactions contemplated by, or in relation to, this Agreement including the McFarlane Private Placement, the Amalgamation and the Business Combination;

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

"U.S. Person" means a "U.S. person" as defined in Regulation S under the U.S. Securities Act; and

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

1.02 Headings

The division of this Agreement into Articles and Sections and the insertion of a table of contents and headings are for convenience of reference only and do not affect the construction or interpretation of this Agreement. The terms "hereof", "hereunder" and similar expressions refer to this Agreement and not to any particular Article, Section or other portion hereof. Unless something in the subject matter or context is inconsistent therewith, references herein to Articles, Sections and Schedules are to Articles and Sections of and Schedules to this Agreement.

1.03 Extended Meanings

In this Agreement, words importing the singular number include the plural and vice versa, words importing any gender include all genders and words importing persons include individuals, corporations, limited and unlimited liability companies, general and limited partnerships, associations, trusts, unincorporated organizations, joint ventures and Governmental Authorities. The term "including" means "including without limiting the generality of the foregoing".

1.04 Statutory References

In this Agreement, unless something in the subject matter or context is inconsistent therewith or unless otherwise herein provided, a reference to any statute is to that statute as now enacted or as the same may from time to time be amended, re-enacted or replaced and includes any regulations made thereunder.

1.05 Accounting Principles

Wherever in this Agreement reference is made to a calculation to be made or an action to be taken in accordance with generally accepted accounting principles, such reference will be deemed to be to the generally accepted accounting principles from time to time approved by the Chartered Professional Accountants of Canada, or any successor institute, applicable as at the date on which such calculation or action is made or taken or required to be made or taken.

1.06 Currency

All references to currency herein are to lawful money of Canada.

1.07 Schedules

The following are the Schedules to this Agreement:

Schedule"A"	-	AmalgamationAgreement
Schedule "B"	-	McFarlaneDisclosure Schedule
Schedule "C"	-	128Disclosure Schedule

ARTICLE 2 BUSINESS COMBINATION

2.01 Business Combination

(a) 128 and McFarlane agree to effect the combination of their respective businesses and assets by way of a "three-cornered amalgamation" among 128, Subco and McFarlane.

(b) McFarlane has called and has held a special meeting of McFarlane Common Shareholders on December 6, 2021 (the "Special Meeting") pursuant to the McFarlane Notice which it has mailed to the McFarlane Common Shareholders, at which Special Meeting McFarlane has obtained the approval of the McFarlane Common Shareholders (the "McFarlane Common Shareholder Approval") for, among other things, the Amalgamation, in accordance with McFarlane's articles and applicable Laws.

(c) The 128 Shareholders, by unanimous shareholder resolution dated December 7, 2021, have approved the 128 Continuation Resolution, Board Change and the Compensation Plan and that the directors of 128, by unanimous director resolution dated December 7, 2021, have approved the 128 Name Change, the 128 Share Split, the 128 Listing and the Compensation Plan. 128, as sole shareholder of Subco, has approved, by unanimous shareholder resolution dated December 7, 2021, the Amalgamation.

(d) Prior to the effectiveness of the transactions set out in 2.01(e) below, 128 shall implement the 128 Name Change and the 128 Share Split.

(e) On the Closing Date and subject to approval by the Exchange, McFarlane and Subco will amalgamate, pursuant to the provisions of the OBCA, by jointly completing and filing Articles of Amalgamation with the Director, and shall continue as one corporation ("Amalco") effective at the Effective Time, giving effect to the Amalgamation, subject to the terms of the Amalgamation Agreement.

(f) At the Effective Time and as a result of the Amalgamation:

• (i) each holder of McFarlane Common Shares (other than McFarlane Dissenting Shareholders described in Section 2.02) shall receive that many fully paid and nonassessable 128 Shares equal to the number of McFarlane Common Shares held by such holder multiplied by the Exchange Ratio (subject to Section 2.01(f)(vii) regarding fractional shares), following which all such McFarlane Common Shares shall be converted into Amalco Sharesin consideration for the issuance of such 128 Shares on the basis of one Amalco Share for each 128 Share issued;

• (ii) each holder of Subco Common Shares (other than 128) shall receive that many fully paid and non-assessable 128 Shares equal to the number of Subco Common Shares held by such holder multiplied by the Exchange Ratio (subject to Section 2.01(f)(vii) regarding fractional shares), following which all such Subco Common Shares shall be converted into Amalco Shares in consideration for the issuance of such 128 Shares on the basis of one Amalco Share for each 128 Share issued;

• (iii) all Subco Common Shares issued to and held by 128 shall be cancelled;

• (iv) 128 shall add to the stated capital maintained in respect of the 128 Shares an amount equal to the aggregate paid-up capital for purposes of the Tax Act of the McFarlane Common Shares and the Subco Common Shares immediately prior to the Effective Time (less the paid-up capital of any McFarlane Common Shares held by dissenting McFarlane Common Shareholders who do not exchange their McFarlane Common Shares for 128 Shares on the Amalgamation);

• (v) Amalco shall add to the stated capital maintained in respect of the Amalco Shares an amount such that the stated capital of the Amalco Shares shall be equal to the aggregate paid-up capital for purposes of the Tax Act of the Subco Shares and McFarlane Common Shares immediately prior to the Effective Time;

• (vi) no fractional 128 Shares will be issuable to shareholders of McFarlane or Subco pursuant to the Amalgamation and no cash payment or other form of consideration will be payable in lieu thereof. In the event that a former holder of McFarlane Common Shares or Subco Common Shares is entitled to receive a fractional 128 Share, any such fractional 128 Share interest to which a shareholder of McFarlane or Subco would otherwise be entitled to pursuant to the Amalgamation will be rounded down to the nearest whole 128 Share;

• (vii) 128 shall be entitled to deduct and withhold from any consideration otherwise payable pursuant to the transactions contemplated by this Agreement to any holder of McFarlane Common Shares or Subco Common Shares, as the case may be, such amounts as it determines are required or permitted to be deducted and withheld with respect to such payment under the Tax Act or any provision of provincial, state, local or foreign tax law, in each case as amended; to the extent that amounts are so withheld, such withheld amounts shall be treated for all purposes hereof as having been paid to the holder of the McFarlane Common Shares or Subco Common Shares, as the case may be, in respect of which such deduction and withholding was made, provided that such withheld amounts are actually remitted to the appropriate taxing authority; and

• (viii) Amalco will be a wholly-owned subsidiary of 128.

• (g) At the Effective Time:

  • (i) subject to subsection 2.01(f), the registered holders of McFarlane Common Shares and Subco Common Shares shall become the registered holders of the Resulting Issuer Sharesto which they are entitled, calculated in accordance with the provisions hereof, and the holders of share certificates representing such McFarlane Common Shares and Subco Common Shares may surrender such certificates to McFarlane's transfer agent and, upon such surrender, shall be entitled to receive and, as soon as reasonably practicable following the Effective Time, shall receive share certificates or direct registration advices representing the number of Resulting Issuer Shares to which they are so entitled;
  • (ii) 128 shall become the registered holder of the Amalco Shares to which it is entitled, calculated in accordance with the provisions hereof, and shall be entitled to receive a share certificate representing the number of Amalco Shares to which it is entitled, calculated in accordance with the provisions hereof; and
  • (iii) the 128 Board Change shall become effective.

(h) At the Effective Time, the McFarlane Warrants and the Subco Warrants shall be exchanged for Resulting Issuer Replacement Warrants exercisable to acquire, on the same terms and conditions as were applicable to such McFarlane Warrants and Subco Warrants immediately prior to the Effective Time, the number of 128 Shares (rounded down to the nearest whole number) equal to the product of: (A) the number of McFarlane Common Shares subject to such McFarlane Warrant (in the case of the McFarlane Warrants) and the number of Subco Common Shares subject to such Subco Warrant (in the case of the Subco Warrants), in each case immediately prior to the Effective Time; and (B) the Exchange Ratio. The exercise price per 128 Share subject to a Resulting Issuer Replacement Warrant shall be an amount (rounded up to the nearest tenth of a cent) equal to the quotient of: (A) the exercise price per McFarlane Common Share or Subco Common Share subject to such McFarlane Warrant or Subco Warrant (as applicable), immediately prior to the Effective Time divided by (B) the Exchange Ratio. Except as set out above, the term to expiry, conditions to and manner of exercise and other terms and conditions of each Resulting Issuer Replacement Warrant shall be the same terms and conditions of the McFarlane Warrant or Subco Warrant for which it was exchanged.

(i) At the Effective Time, the McFarlane Options shall be exchanged for Resulting Issuer Replacement Options exercisable to acquire, on the same terms and conditions as were applicable to such McFarlane Options immediately prior to the Effective Time, the number of 128 Shares (rounded down to the nearest whole number) equal to the product of: (A) the number of McFarlane Common Shares subject to such McFarlane Option immediately prior to the Effective Time; and (B) the Exchange Ratio. The exercise price per Resulting Issuer Share subject to a Resulting Issuer Replacement Option shall be an amount (rounded up to the nearest tenth of a cent) equal to the quotient of: (A) the exercise price per McFarlane Common Share subject to such McFarlane Option immediately prior to the Effective Time divided by (B) the Exchange Ratio. Except as set out above, the term to expiry, conditions to and manner of exercise and other terms and conditions of each Resulting Issuer Replacement Option shall be the same terms and conditions of the McFarlane Option for which it was exchanged.

(j) At the Effective Time, the McFarlane Broker Warrants shall be exchanged for McFarlane Broker Warrants shall receive Resulting Issuer Replacement Broker Warrants exercisable to acquire, on the same terms and conditions as were applicable to such McFarlane Broker Warrants immediately prior to the Effective Time, the number of 128 Shares (rounded down to the nearest whole number) equal to the product of: (A) the number of McFarlane Common Shares subject to such McFarlane Broker Warrants immediately prior to the Effective Time; and (B) the Exchange Ratio. The exercise price per 128 Share subject to a Resulting Issuer Replacement Broker Warrant shall be an amount (rounded up to the nearest tenth of a cent) equal to the quotient of: (A) the exercise price per McFarlane Common Share subject to such McFarlane Broker Warrant immediately prior to the Effective Time divided by (B) the Exchange Ratio. Except as set out above, the term to expiry, conditions to and manner of exercise and other terms and conditions of each Resulting Issuer Replacement Broker Warrant shall be the same terms and conditions of the McFarlane Broker Warrant for which it was exchanged.

(k) At the Effective Time, each McFarlane Common Share held by a McFarlane Dissenting Shareholder shall be deemed to be transferred by the holder thereof, without any further act or formality on its part, free and clear of any Encumbrance, to Amalco, and Amalco shall thereupon be obliged to pay the amount therefor determined and payable in accordance with Section 2.02 hereof, the name of such holder shall be removed from the central securities register as a holder of McFarlane Common Shares and such McFarlane Dissenting Shareholder will cease to have any rights as a McFarlane Common Shareholder, other than the right to be paid the fair value of its McFarlane Common Shares in accordance with Section 2.02.

(l) If a McFarlane Dissenting Shareholder fails to perfect or effectively withdraws its claim under section 185 of the OBCA or forfeits its right to make a claim under section 185 of the OBCA or if its rights as a McFarlane Common Shareholder are otherwise reinstated, such holder's McFarlane Common Shares shall thereupon be deemed to have been exchanged as of the Effective Time as prescribed by paragraph 2.01(f)(i).

(m) Upon the approval of the resolutions of the directors and shareholders of 128 authorizing the 128 Name Change in accordance with the requirements of the BCBCA and immediately prior to the Effective Time, 128 shall complete and file Articles of Amendment, in the prescribed form, giving effect to the 128 Name Change upon and subject to the terms of this Agreement.

(n) 128 Shares will only be issued to U.S. Persons that are Accredited Investors and shall be "restricted securities" as defined in Rule 144(a)(3) of the U.S. Securities Act and shall bear a legend in customary form restricting re-sale and transfer without registration under the U.S. Securities Act unless pursuant to an available exemption from registration under the U.S. Securities Act.

2.02 Dissent Rights

Registered McFarlane Common Shareholders may exercise rights of dissent ("Dissent Rights") from the Amalgamation pursuant to, and in the manner set forth under, section 185 of the OBCA, provided that holders who exercise such rights of dissent and who:

• (a) are ultimately entitled to be paid fair value for their McFarlane Common Shares, which fair value shall be the fair value of such shares as at the close of business on the day prior to the McFarlane Meeting, shall be paid an amount equal to such fair value by Amalco; and
• (b) are ultimately not entitled, for any reason, to be paid fair value for their McFarlaneCommon Shares shall be deemed to have participated in the Amalgamation, as of the Effective Time, on the same basis as a non-dissenting holder of McFarlane Common Shares and shall be entitled to receive only the consideration contemplated in subsection 2.01(f)(i) hereof that such holder would have received pursuant to the Amalgamation if such holder had not exercised Dissent Rights;

but in no case shall 128, Subco, McFarlane or any other Person be required to recognize holders of McFarlane Common Shares who exercise Dissent Rights as holders of McFarlane Common Shares after the time that is immediately prior to the Effective Time, and the names of such holders of McFarlane Common Shares who exercise Dissent Rights shall be deleted from the register of McFarlane Common Shareholders at the Effective Time. In no circumstances shall 128, Subco, McFarlane or any other Person be required to recognize a Person exercising Dissent Rights unless such Person is a registered holder of McFarlaneCommon Shares in respect of which such Dissent Rights are sought to be exercised. A registered holder of McFarlane Common Shares is not entitled to exercise Dissent Rights with respect to McFarlane Common Shares if such holder votes (or instructs, or is deemed, by submission of any incomplete proxy, to have instructed his, her or its proxyholder to vote) in favour of the resolution approving the Amalgamation at the McFarlane Meeting.

ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF MCFARLANE

McFarlane represents and warrants to 128 as follows except as set forth in the McFarlane Disclosure Schedule and acknowledges and confirms that McFarlane is relying on such representations and warranties in connection with its entering into this Agreement:

3.01 Incorporation and Registration

McFarlane is a corporation duly incorporated and validly existing under the Laws of its jurisdiction of incorporation and has all necessary corporate power, authority and capacity to own its property and assets and to carry on its business as currently conducted. Neither the nature of its activities or the McFarlane Business nor the location or character of the Assets owned, operated or leased by McFarlane requires McFarlane to be registered, licensed or otherwise qualified as a foreign corporation or to be in good standing in any jurisdiction other than the jurisdictions where it is so registered, licensed or qualified. No proceedings have been instituted or are pending for the dissolution or liquidation of McFarlane.

3.02 Subsidiaries

McFarlane does not have any interest in any body corporate, partnership, joint ventures or other entity or Person. McFarlane is not a party to any agreement, option or commitment to acquire any shares or securities of any body corporate, partnership, trust, joint venture or other entity or Person other than in connection with the Business Combination.

3.03 Bankruptcy, etc.

No bankruptcy, insolvency, commercial proposals, assignments to creditors or receivership proceedings have been instituted by McFarlane or, to the knowledge of McFarlane, are pending against McFarlane and McFarlane is, in the McFarlane Ordinary Course, able to pay its debts and other obligations as they become due

3.04 Due Authorization, etc.

Subject to the requisite shareholder approvals, (i) McFarlane has all necessary corporate power, capacity and authority to enter into this Agreement and to carry out its obligations under this Agreement and to undertake the Business Combination. This Agreement has been duly authorized, executed and delivered by McFarlane and constitutes a valid and binding obligation of McFarlane enforceable against it in accordance with its terms, subject to limitations with respect to enforcement imposed by Law in connection with bankruptcy or similar proceedings and to the extent that equitable remedies such as specific performance and injunctions are in the discretion of the court from which they are sought.

3.05 [intentionally deleted]

3.06 Absence of Conflict

The entering into, and the performance by McFarlane of the transactions contemplated in, this

Agreement:

• (a) do not and will not require any consent, permit, approval, Authorization or order of any Governmental Authority, except that which may be required under applicable securities legislation or the rules of the Exchange and any approval or authorization under the OBCA for the Business Combination and the Amalgamation;
• (b) do not and will not contravene any applicable Laws or any rule or regulation of any Governmental Authority which is binding on McFarlane, where such contravention would reasonably be expected to materially and adversely affect the business, operations or condition (financial or otherwise) of McFarlane; and
• (c) does not and will not violate, result in the breach of, or be in conflict with, or constitute a default under, or create a state of facts which, after notice or lapse of time, or both, would constitute a default under any term or provision of (i) the Constating Documents of McFarlane, or any resolution of the directors or shareholders of McFarlane, or (ii) any Contract to which McFarlane is a party or by which the Assets or the McFarlane Business is bound or affected, or (iii) any judgment, decree or order or any term or provision thereof applicable to McFarlane or any of the Assets or the McFarlane Business, which breach, conflict or default would reasonably be expected to materially and adversely affect the business, operations or condition (financial or otherwise) of McFarlane or result in the creation of any Encumbrance upon any of the Assets.

3.07 Capital Stock

The authorized capital of McFarlane consists of an unlimited number of common shares of which 75,582,313 McFarlane Common Shares are issued and outstanding as at the date hereof. All of the issued shares of McFarlane have been duly and validly issued in compliance with applicable Law and are outstanding as fully paid and non-assessable shares in the capital of McFarlane**.**

3.08 Options and Other Convertible Securities

Except for (i) the McFarlane Warrants, McFarlane Options and the McFarlane Broker Warrantsissued pursuant to the McFarlane Private Placement;(ii) theCSM Consideration Sharesto be issued pursuant to the acquisition of the McFarlane Mineral Properties; and (iii) the right to purchase Resulting Issuer Common Shares pursuant to the CSM Right of First Refusal, no Person has or will have any right, agreement, warrant or option, present or future, contingent or absolute, or any right capable of becoming a right, agreement or option, for the purchase from McFarlane of any interest in any of the outstanding shares or securities of McFarlane, or for the issue or allotment of any unissued shares in the capital of McFarlane or any other security directly or indirectly convertible into or exchangeable for such shares in the capital of McFarlane.

3.09 No Pre-Emptive Rights

No holder of securities of McFarlane, other than pursuant to the McFarlane Warrants, McFarlane Options and the McFarlane Broker Warrants, and other than the right of CSM to the CSM Consideration Shares and pursuant to the CSM Right of First Refusal, is entitled to any pre-emptive or similar right to subscribe for securities of McFarlane.

3.10 No Shareholders/Voting Agreement

There are no shareholders' agreements or other agreements to which McFarlane is a party governing the voting, holding or sale of McFarlane Common Shares or the management of the affairs of McFarlane, and McFarlane is not aware of any other such agreement to which McFarlane is not a party.

3.11 Financial Statements

The McFarlane Financial Statements have been prepared in accordance with IFRS applied on a basis consistent with that of preceding periods, and:

• (a) the consolidated statements of financial position included in such McFarlane Financial Statements fairly present, in all material respects, the assets, liabilities (whether accrued, absolute, contingent or otherwise) and financial condition of McFarlane on the respective dates thereof and do not omit to state any material fact that is required by IFRS or by applicable Laws to be stated or reflected therein or which is necessary to make the statements contained therein not misleading; and
• (b) the consolidated statements of loss and comprehensive loss and consolidated statements of cash flows included in the McFarlane Financial Statements fairly present, in all material respects, the results of operations of McFarlane for the fiscal periods then ended.

There are no material off-balance sheet transactions, arrangements or obligations (including contingent obligations) of McFarlane which are required to be disclosed and are not disclosed or reflected in the McFarlane Financial Statements and McFarlane does not have any material liabilities, obligations, indebtedness or commitments, whether accrued, absolute, contingent or otherwise, which are not disclosed or referred to in the McFarlane Financial Statements.

3.12 Absence of Changes

Since August 31, 2021, there has not been any material adverse change in the McFarlane Business and the results of operations, financial condition, assets, properties, capital, liabilities (contingent or otherwise), cash flow or business operations of McFarlane considered on a consolidated basis;

3.13 Internal Controls Over Financial Reporting

To the knowledge of McFarlane, prior to the date of this Agreement, there is no fraud, whether or not material, that involves management or other employees who have a significant role in McFarlane's internal control over financial reporting. Since December 31, 2019, and prior to the date of this Agreement, McFarlane has received no (x) material complaints from any source regarding accounting, internal accounting controls or auditing matters or (y) expressions of concern from employees of McFarlane regarding questionable accounting or auditing matters.

3.14 No Restrictions on Activities

Other than as otherwise disclosed in the McFarlane Financial Statements, none of McFarlane is a party to or bound or affected by any commitments, agreement or document containing any covenant which expressly limits the freedom of McFarlane to compete in any line of business, or to use, transfer or move any of its respective Assets or operations, or which materially or adversely affects the business practices, operations or condition of McFarlane.

3.15 Mining Matters

• (a) Other than as disclosed in the McFarlane Disclosure Schedule, McFarlane is the absolute legal and beneficial owner of and has good and marketable title to, all of the material property or assets thereof as described in the McFarlane Disclosure Schedule, and except as set forth in the McFarlane Disclosure Schedule, such material properties and assets are free of all mortgages, liens, charges, pledges, security interests, Encumbrances, claims or demands whatsoever, and no other property rights (including access rights) are necessary for the conduct of the business of McFarlane currently conducted; McFarlane knows of no claim or basis for any claim that might or could adversely affect the right of McFarlane to use, transfer or otherwise exploit such property rights; and, except as disclosed in the McFarlane Disclosure Schedule, McFarlane does not have any responsibility or obligation to pay any commission, royalty, licence fee or similar payment to any person with respect to the property rights thereof;
• (b) McFarlane holds either freehold title, mining leases, mining claims or other conventional property, proprietary or contractual interests or rights, recognized in the jurisdiction in which a particular property is located in respect of the ore bodies and minerals located in properties in which McFarlane has an interest as described in the McFarlane Disclosure Schedule under valid, subsisting and enforceable title documents or other recognized and enforceable agreements or instruments, sufficient to permit McFarlane to access the property and explore the minerals relating thereto; all such property, leases or claims and all property, leases or claims in which McFarlane has any interests or right have been, to the knowledge of McFarlane, validly located and recorded in accordance with all applicable Laws, and are valid and subsisting; McFarlane has all necessary surface rights, access rights and other necessary rights and interests relating to the properties in which McFarlane has an interest as described in the McFarlane Disclosure Schedule granting McFarlane the right and ability to access the property and explore for minerals for development purposes as are appropriate in view of their respective rights and interests therein, with only such exceptions as do not materially interfere with the access and use by McFarlane of the rights or interests so held and each of the proprietary interests or rights and each of the documents, agreements and instruments and obligations relating thereto referred to above are currently in good standing in the name of McFarlane;
• (c) any and all of the agreements and other documents and instruments pursuant to which McFarlane holds its material property and assets are valid and subsisting agreements, documents or instruments in full force and effect, enforceable in accordance with the terms thereof, neither McFarlane is in default of any of the material provisions of any such agreements, documents or instruments, nor has any such default been alleged. None of the properties of McFarlane are subject to any right of first refusal or purchase or acquisition rights;
• (d) there are no claims with respect to native rights currently threatened or, to the best knowledge of McFarlane, pending with respect to any of the material properties of McFarlane;
• (e) McFarlane is in compliance in all material respects with all applicable federal, provincial, state, municipal and local laws, statutes, ordinances, by-laws and regulations and orders,

directives and decisions rendered by any ministry, department or administrative or regulatory agency, domestic or foreign, including laws, ordinances, regulations or orders, 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 substances (the "Environmental Laws");

• (f) McFarlane has obtained all material licences, permits, approvals, consents, certificates, registrations and other authorizations under all applicable Environmental Laws (the "Environmental Permits") necessary as at the date hereof for the operation of the business carried by McFarlane, and each Environmental Permit is valid, subsisting and in good standing and McFarlane is not in default or breach of any Environmental Permit in any material respect and no proceeding has been threatened, or to the best knowledge of McFarlane, is pending to revoke or limit any Environmental Permit;

• (g) McFarlane has not used, except in compliance in all material respects with all Environmental Laws and Environmental Permits, 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;

• (h) McFarlane has not received any notice of, or been prosecuted for an offence alleging, noncompliance with any laws, ordinances, regulations and orders, including Environmental Laws, and McFarlane has not settled any allegation of non-compliance 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 McFarlane, nor has McFarlane received notice of any of the same;

• (i) there have been no past unresolved or threatened, and to the best of McFarlane's knowledge, there are no pending claims, complaints, notices or requests for information received by McFarlane with respect to any alleged material violation of any law, statute, order, regulation, ordinance or decree; and to the best of McFarlane's knowledge, no conditions exist at, on or under any property now or previously owned, operated or leased by McFarlane which, with the passage of time, or the giving of notice or both, would give rise to liability under any law, statute, order, regulation, ordinance or decree that, individually or in the aggregate, has or may reasonably be expected to have any materially adverse effect with respect to McFarlane, taken as a whole;

• (j) except as ordinarily or customarily required by applicable permit, McFarlane has not received any notice wherein it is alleged or stated that it is potentially responsible for a federal, provincial, state, municipal or local clean-up site or corrective action under any law including any Environmental Laws. McFarlane has not received any request for information in connection with any federal, state, municipal or local inquiries as to disposal sites;

• (k) all exploration and mining operations on the properties of McFarlane have been conducted in all respects in accordance with good mining and engineering practices and all applicable material workers' compensation and health and safety and workplace laws, regulations and policies have been complied with;

• (l) there are no environmental audits, evaluations, assessments, studies or tests relating to McFarlane except for ongoing assessments conducted by or on behalf of McFarlane in the ordinary course;

• (m) McFarlane is in compliance with the provisions of National Instrument 43-101 Standards of Disclosure for Mineral Projects;

• (o) McFarlane's mineral projects are comprised of the properties set forth in the McFarlane Disclosure Schedule, all of which are valid and in good standing.

3.16 Extent of Liabilities

Other than expenses incurred in connection with the Business Combination and in the McFarlane Ordinary Course, McFarlane has no Liabilities (accrued, absolute, contingent or otherwise), except as disclosed in the McFarlane Financial Statements.

3.17 Non-Arm's Length Transactions

Except as disclosed in the McFarlane Financial Statements:

(a) McFarlane has not engaged in any transaction with, made any payment or loan to, or borrowed any monies from or is otherwise indebted to, any director, officer, employee or shareholder of McFarlane or any other Person with whom McFarlane is not dealing at arm's length (within the meaning of the Tax Act) or any Affiliate of any of the foregoing, except for amounts due as normal compensation or reimbursement of ordinary business expenses; and

(b) McFarlane is not a party to any contract or agreement with any director, officer, employee or shareholder of McFarlane or any other Person with whom McFarlane is not dealing at arm's length (within the meaning of the Tax Act) or any Affiliate of any of the foregoing, other than employment agreements entered into in the McFarlane Ordinary Course.

3.18 No Guarantees

McFarlane is not bound by any Contract, assurance, bond, undertaking or guarantee under or pursuant to which it has guaranteed or endorsed the debts, obligations or Liabilities of any other Person, except as disclosed in the McFarlane Financial Statements.

3.19 Owned Real Property.

McFarlane does not own any real property.

3.20 McFarlane Material Contracts

As at the date of this Agreement, all of the McFarlane Material Contracts are set out in Schedule 3.25 of the McFarlane Disclosure Schedule, all such McFarlane Material Contracts are valid and subsisting agreements, enforceable in accordance with their terms, and can be fulfilled and performed in all material respects by McFarlane in the McFarlane Ordinary Course. Each such McFarlane Material Contract is unamended since being made available to 128, is in full force and effect, in good standing and no event of default has occurred and is continuing and no event has occurred which, with the giving of notice, the passing of time or both, would constitute an event of default by McFarlane under any McFarlane Material Contract. To the knowledge of McFarlane, no event has occurred which, with the giving of notice, the lapse of time or both, would constitute an event of default by any other party to any such McFarlane Material Contract, none of McFarlane is alleged to be in default of any of the provisions of such McFarlane Material Contracts, and McFarlane is not aware of any disputes with respect thereto.

3.21 Other Contracts

Other than the McFarlane Material Contracts, McFarlane is not a party to any Contract, the termination, expiry or non-renewal of which would reasonably be expected to have a McFarlane Material Adverse Effect.

3.22 Taxes and Governmental Charges

• (a) As of the date of this Agreement, McFarlane has:

  • (i) duly and in a timely manner filed all Tax Returns and reports required by Law to have been filed by it (except for such Tax Returns and reports with respect to which the failure to timely file would not reasonably be expected to have a McFarlane Material Adverse Effect), and all such Tax Returns and reports are true, correct and complete in all material respects;
  • (ii) duly kept all records which it is required to keep for Tax purposes or which would be needed to substantiate any claim made or position taken in relation to Tax by it, as applicable, and such records are available for inspection at the head office of McFarlane;
  • (iii) duly and correctly reported all income and other amounts required to be reported;
  • (iv) paid all Taxes to the extent that such Taxes have been assessed by the relevant taxation authority; and
  • (v) duly and in a timely manner paid, deducted, withheld, collected and remitted all Governmental Charges (other than Governmental Charges that are not yet due) and has made full provision for (including properly accruing and reflecting on its books and records) all Governmental Charges that are not yet due, that relate to periods (or portions thereof) ending prior to the date of this Agreement, except where the failure to pay any such Governmental Charges, or make any such remittance, deduction or contribution or other amount would not reasonably be expected to have a McFarlane Material Adverse Effect.

• (b) The McFarlane Financial Statements contain adequate provision for all Taxes, assessments and levies imposed on McFarlane, or their property or rights, arising out of operations on or before August 31, 2021, regardless of whether such amounts are payable before or after the Effective Date.

• (c) No deficiency in payment of any Taxes for any period has been asserted against McFarlane by any Governmental Authority and remains unsettled at the date hereof.

• (d) No Tax Return of McFarlane is being audited by the relevant taxing authority. There are no outstanding waivers, objections, extensions or comparable consentsregarding the application of the statute of limitations or period of reassessment with respect to any Taxes or Tax Returns that have been given or made by McFarlane (including the time for filing of Tax Returns or paying Taxes). To the knowledge of McFarlane, there are no pending requests for any such waivers, extensions or comparable consents. McFarlane has not received a ruling from any Governmental Authority or signed an agreement with any Governmental Authority that could reasonably be expected to have a McFarlane Material Adverse Effect.

• (e) There are no actions, suits, examinations, proceedings, investigations, audits or claims now pending or threatened or, to the knowledge of McFarlane, contemplated against McFarlane in respect of any Taxes and there are no matters under discussion with any Governmental Authority relating to any Taxes.

• (f) McFarlane has not been subject to or is currently subject to any investigation, audit or visit by any Governmental Authority relating to Tax which has been notified to McFarlane, and McFarlane is not aware of any such investigation, audit or visit planned for the next 12 months.

3.23 Environmental Matters

To the knowledge of McFarlane after due inquiry, all the properties in which McFarlane has any freehold, leasehold, license or other interest are free and clear of any hazardous or toxic material, pollution or other adverse environmental conditions which may give rise to any and all claims, actions, causes of action, damages, Losses, Liabilities, obligations, penalties, judgments, amounts paid in settlement, assessments, costs, disbursement or expenses (including, without limitation, attorneys' fees and costs, experts' fees and costs and consultant's fees and costs) of any kind or of any nature whatsoever that are asserted against McFarlane, alleging liability (including, without limitation, liability for studies, testing or investigatory costs, cleanup costs, response costs, removal costs, remediation costs, contaminant costs, restoration costs, corrective action costs, closure costs, reclamation costs, natural resource damages, property damages, business Losses, personal injuries, penalties or fines) arising out of, based on or resulting from (i) the presence, Release, threatened Release, discharge or emission into the environment of any hazardous materials or substances existing or arising on, beneath or above properties or emanating or migrating or threatening to emanate or migrate from such properties to off-site properties; (ii) physical disturbance of the environment; and (iii) the violation or alleged violation of all applicable Laws aimed at reclamation or restoration of such properties; abatement of pollution; protection of the environment, protection of wildlife, including endangered species; ensuring public safety from environmental hazards; protection of cultural and historic resources; management, storage or control of hazardous materials and substances; Releases or threatened Releases of pollutants, Contaminants, chemicals or industrial, toxic or hazardous substances as wastes into the environment, including without limitation, ambient air, surface water and groundwater; and all other applicable Laws relating to the manufacturing, processing, distribution, use, treatment, storage, disposal, handling or transport of pollutants, Contaminants, chemicals or industrial, toxic or hazardous substances or wastes (collectively, "Environmental Laws"); and to the knowledge of McFarlane, after due inquiry, all environmental approvals required pursuant to Environmental Laws with respect to activities carried out on any part of the lands covered by such properties have been obtained, are valid and in full force and effect and have been complied with; and there are no proceedings commenced or threatened to revoke or amend any such environmental approvals.

3.24 Absence of Litigation, etc.

There is not now in progress, pending or, to McFarlane's knowledge, threatened or contemplated against or affecting McFarlane, or any of their assets or properties, or any officer or director thereof in their capacity as an officer or director thereof, any litigation, action, suit, investigation, claim, complaint or other proceeding, including appeals and applications for review, by or before any Governmental Authority**.**

3.25 Compliance with Laws

The McFarlane Business has been, and is now being, conducted and all of the Assets have been, and are now being, used in compliance with all applicable Laws other than such non-compliance which - 23 -

would not reasonably be expected to have a McFarlane Material Adverse Effect, and no written notices have been received by McFarlane that the McFarlane Business is not being conducted or that any of such Assets are not being used in compliance with all applicable Laws other than any non-compliance that would not reasonably be expected to have a McFarlane Material Adverse Effect.

3.26 Authorizations and Consents

• (a) Except for the approval of the Exchange contemplated in Section 7.02(i), no Authorization or declaration or filing with any Governmental Authority on the part of McFarlane is required for the valid execution, delivery and performance of its obligations under this Agreement or the completion of the Business Combination pursuant to this Agreement.
• (b) No consent, approval or waiver is required pursuant to the terms of any McFarlane Material Contract for the valid execution, delivery and performance of its obligations under this Agreement or the completion of the Business Combination pursuant to this Agreement.

3.27 Employment Matters and Employee Plans

• (a) There are no Contracts, written or oral, between McFarlane on one side, and any other party on the other side, relating to payment, remuneration or compensation for work performed or services provided (other than professional advisors engaged by McFarlane to provide services in connection with the Business Combination and the McFarlane Private Placement) or that would require any payment to be made as a result of the completion of the transactions contemplated in this Agreement.
• (b) Section 3.27(b) of the McFarlane Disclosure Schedule contains a complete list of all employment agreements or contracts for services between McFarlane on one side, and any other party on the other side, including, but not limited to any of its directors, officers, employees or consultants, who have an annual salary greater than **$**50,000, and copies of all such agreements have been provided by McFarlane to 128.
• (c) Section 3.27(c) of the McFarlane Disclosure Schedule sets out any Employee Plans of McFarlane.
• (d) McFarlane is not a party to a collective bargaining agreement.
• (e) McFarlane has operated and is currently operating in compliance with all Laws relating to employees, including employment standards, human rights, occupational health and safety, all pay equity and employment equity legislation other than such non-compliance which would not reasonably be expected to have a McFarlane Material Adverse Effect and there have been no employment-related complaints against McFarlane.
• (f) There are no complaints, and to the knowledge of McFarlane, threatened complaints, against McFarlane before any employment standards branch or tribunal or human rights commission or tribunal, nor any occurrence which might lead to a complaint under any human rights legislation, employment standards legislation, health and safety legislation, workers' compensation legislation or pay equity legislation.
• (g) There are no outstanding decisions or settlements or pending settlements under employment standards, human rights legislation, health and safety legislation, workers' compensation legislation, payment equity legislation or labour relations legislation which place any

obligation upon McFarlane to do or refrain from doing any act or place a material financial obligation on McFarlane.

• (h) There are no actions, suits or claims pending, threatened or reasonably anticipated (other than routine claims for benefits) against any Employee Plan or its assets, and there are no audits, inquiries or proceedings pending or, to the knowledge of McFarlane, threatened by any Governmental Authority with respect to any Employee Plan, which in either case reasonably could be expected to result in material Liability to McFarlane.
• (i) Neither the execution and delivery of this Agreement nor the performance of the obligations of McFarlane hereunder will entitle any current or former employee of McFarlane to any severance pay, bonus or other similar payment.

3.28 No Powers of Attorney

There are no outstanding powers of attorney or other authorizations granted by McFarlane to any third party to bind McFarlane to any Contract, Liability or obligation.

3.29 Insurance

McFarlane does not have (nor has it ever had) any insurance of any nature whatsoever relating to it, the Assets, the McFarlane Business other than directors and officers liability insurance maintained in respect of McFarlane's directors and officers.

3.30 Authorizations

McFarlane has all Authorizations necessary to conduct the McFarlane Business as presently conducted or for the ownership and use of the Assets in compliance with applicable Laws, except for any Authorizations the lack of which would not reasonably be expected to materially and adversely affect the business, operations or condition (financial or otherwise) of McFarlane. McFarlane is not in default under, nor have any of them received any notice of any claim or default with respect to, any such Authorization. No registrations, filings, applications, notices, transfers, consents, approvals, audits, qualifications, waivers or other action of any kind is required by virtue of the execution and delivery of this Agreement, or of the consummation of the transactions contemplated hereby: (a) to avoid the loss of any Authorization or any asset, property or right pursuant to the terms thereof, or the violation or breach of any Law applicable thereto, or (b) to enable McFarlane to hold and enjoy any such Authorization, asset, property or right immediately after the Effective Date in the conduct of the McFarlane Business in the same manner as conducted prior to the Effective Date.

3.31 Fees and Commissions

McFarlane is not a party to or bound by any Contract to pay any royalty, license fee or management fee, except for the McFarlane Material Contracts. Other than brokers' fees payable pursuant to the McFarlane Private Placement, no broker, finder or similar intermediary has acted for or on behalf of or is entitled to any broker's, finder's or similar fee or other commission from McFarlane or 128 in connection with this Agreement.

3.32 Books and Records

Complete and correct copies of the Constating Documents, and of all amendments thereto, of McFarlane have been previously delivered to 128. The corporate records and minute books of McFarlane

contain, in all material respects, complete and accurate minutes of all meetings of the directors and shareholders thereof, since the date of incorporation, together with the full text of all resolutions of directors and shareholders passed in lieu ofsuch meetings duly signed. Except as reflected in such minute books, there are no minutes of meetings or consents in lieu of meetings of the board of directors (or its committees) or of the shareholders of McFarlane.

3.01 Information Supplied

None of the information regarding McFarlane or its assets or business that was supplied by McFarlane specifically for inclusion or incorporation by reference into the Listing Statement will, at the time of initial submission of the Listing Statement to the Exchange, or at the time of any amendment or supplement thereof, as amended or supplemented at such date or time, contain any misrepresentation or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances under which they are made.

3.02 Restrictions on Business Combination

Except to the extent that McFarlane must comply with the policies of the Exchange and applicable Laws, McFarlane is not a party to or bound or affected by any commitment, agreement or document containing any covenant which expressly limitsthe freedom of McFarlane to compete in any line of business, or to transfer or move any of its Assets or operations or which materially or adversely affects the business practices, operations or condition of McFarlane or which would prohibit or restrict McFarlane from entering into and completing the Business Combination.

ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF 128 AND SUBCO

128 and Subco jointly and severally represent and warrant to McFarlane as follows except as set forth in the 128 Disclosure Schedule and acknowledge and confirm that McFarlane is relying on such representations and warranties in connection with its entering into this Agreement:

4.01 Incorporation

Each of 128 and Subco is a corporation duly incorporated and validly existing under the Laws of its jurisdiction of incorporation and has all necessary corporate power, authority and capacity to own its property and assets and to carry on its business as currently conducted, except where the failure to have such power, authority and capacity would not reasonably be expected to have a 128 Material Adverse Effect. Neither the nature of its activities or business nor the location or character of the assets owned, operated or leased by 128 require it to be registered, licensed or otherwise qualified as a foreign corporation or to be in good standing in any jurisdiction other than the jurisdictions where it is so registered, licensed or qualified, except where the failure to be so registered, licensed or qualified or remain in good standing would not reasonably be expected to have a 128 Material Adverse Effect. No proceedings have been instituted or are pending for the dissolution or liquidation of 128 or Subco.

4.02 Subsidiaries

Except for its ownership of outstanding shares of Subco, 128 does not have any interest in any body corporate, partnership, joint ventures or other entity or Person. Neither of 128 nor Subco is a party to any agreement, option or commitment to acquire any shares or securities of any body corporate, partnership, trust, joint venture or other entity or Person other than in connection with the Business Combination. All of the Subco Common Shares held by 128 are held, free and clear of all Encumbrances, claims or demands of any kind whatsoever other than Permitted Encumbrances. All of such shares and securities have been fully authorized and validly issued and in the case of shares are outstanding as fully paid and non-assessable shares. Other than securities issued pursuant to the Subco Private Placement, no other securities of Subco are issued and outstanding, and no other securities of Subco will be issued and outstanding at the Effective Date.

4.03 Bankruptcy, etc.

No bankruptcy, insolvency or receivership proceedings have been instituted by 128 or Subco or, to the knowledge of 128, are pending against 128 or Subco.

4.04 Due Authorization, etc.

Subject to requisite shareholder approvals, (i) each of 128 and Subco has all necessary corporate power, capacity and authority to enter into this Agreement and to carry out its obligations under this Agreement and to undertake the Business Combination, and (ii) this Agreement has been duly authorized, executed and delivered by each of 128 and Subco and constitutes a valid and binding obligation of each of 128 and Subco enforceable against it in accordance with its terms, subject, however, to limitations with respect to enforcement imposed by Law in connection with bankruptcy or similar proceedings and to the extent that equitable remedies such as specific performance and injunctions are in the discretion of the court from which they are sought.

4.05 Absence of Conflict

The entering into, and the performance by 128 and Subco of the transactions contemplated in, this Agreement:

• (a) do not and will not require any consent, permit, approval, Authorization or order of any Governmental Authority, except that which may be required under applicable securities legislation or the rules of the Exchange and any approval or authorization under the: (i) BCBCA that may be required for the 128 Name Change and 128 Share Split; and (ii) and OBCA that may be required for the Business Combination;
• (b) do not and will not contravene any applicable Laws or any rule or regulation of any Governmental Authority which is binding on 128, where such contravention would reasonably be expected to have an 128 Material Adverse Effect; and
• (c) does not and will not violate, result in the breach of, or be in conflict with, or constitute a default under, or create a state of facts which, after notice or lapse of time, or both, would constitute a default under any term or provision of (i) the Constating Documents of 128 or Subco, or any resolution of the directors or shareholders of 128 or Subco, or (ii) any Contract to which 128 or Subco is a party or by which the assets or the business of 128 is bound or affected, or (iii) any judgment, decree or order or any term or provision thereof applicable to 128 or Subco or any of the assets or the business of 128, which breach, conflict or default

would reasonably be expected to have a 128 Material Adverse Effect or to result in the creation of any Encumbrance upon any of the assets of 128.

4.06 Capital Stock

The authorized share capital of 128 consists of an unlimited number of common shares without nominal or par value, of which 3,750,000 Shares are issued and outstanding as fully paid and nonassessable shares in the capital of 128. The authorized capital of Subco consists of an unlimited number of common shares without nominal or par value, of which 65,600 common shares are outstanding. All of the issued shares of 128 and Subco have been duly and validly issued in compliance with applicable Law and are outstanding as fully paid and non-assessable shares in the capital of 128 and Subco, respectively**.**

4.07 Options and Other Convertible Securities

No Person has any agreement or option or any right or privilege (whether by law, pre-emptive or contractual) capable of becoming an agreement or option or right or privilege, for the purchase, subscription, allotment or issuance of any of the unissued shares in the capital of 128 or Subco or for the issue of any other securities of any nature or kind of 128 or Subco, other than in connection with the Subco Private Placement.

4.08 Financial Statements

The 128 Financial Statements have been prepared in accordance with IFRS applied on a basis consistent with that of preceding periods, and:

• (a) the balance sheets included in such 128 Financial Statements fairly present, in all material respects, the financial condition of 128 on the respective dates thereof; and
• (b) the statements of operations and deficit included in the 128 Financial Statements fairly present, in all material respects, the financial performance and its cash flows of 128 for the fiscal periods then ended.

4.09 Absence of Changes

Except as set out in the 128 Financial Statements, since incorporation, there has not been any material adverse change in the results of operations, financial condition, assets, properties, capital, liabilities (contingent or otherwise), cash flow or business operations of 128 that would reasonably be expected to have an 128 Material Adverse Effect.

4.10 Internal Controls Over Financial Reporting

To the knowledge of 128, prior to the date of this Agreement, there is no fraud, whether or not material, that involves management or other employees who have a significant role in 128's, internal control over financial reporting. Since incorporation and prior to the date of this Agreement, 128 has received no (x) material complaints from any source regarding accounting, internal accounting controls or auditing matters or (y) expressions of concern from employees of 128 regarding questionable accounting or auditing matters.

4.11 Ordinary Course

Since incorporation, 128 has carried on no business except as set out in the 128 Financial Statements and except for the transactions contemplated by this Agreement, 128 has carried on its business in the 128 Ordinary Course, and 128 has not carried on any business or entered into any Contract, commitment or agreement of any sort whatsoever other than as disclosed in the Public Record.

4.12 No Restrictions on Activities

128 is not a party to or bound or affected by any commitment, Contract or document containing any covenant which in any way expressly limits the freedom of 128 to compete in any line of business, or to use, transfer or move any of its assets or operations, or which materially or adversely affects the business practices, operations or condition of 128 or Subco, respectively, and taken as a whole.

4.13 Liabilities

Other than expenses incurred in connection with the Business Combination and in the 128 Ordinary Course, 128 has no outstanding Liabilities (accrued, absolute, contingent or otherwise), except as disclosed in the 128 Financial Statements.

4.14 Non-Arm's Length Transactions

Except as disclosed in the 128 Financial Statements:

(a) 128 has not engaged in any transaction with, made any payment or loan to, or borrowed any monies from or is otherwise indebted to, any director, officer, employee or shareholder of 128 or any other Person with whom 128 is not dealing at arm's length (within the meaning of the Tax Act) or any Affiliate of any of the foregoing, except for amounts due as normal compensation or reimbursement of ordinary business expenses; and

(b) 128 is not a party to any contract or agreement with any director, officer, employee or shareholder of 128 or any other Person with whom 128 is not dealing at arm's length (within the meaning of the Tax Act) or any Affiliate of any of the foregoing, other than employment agreements entered into in the 128 Ordinary Course.

4.15 No Guarantees

128 is not bound by any Contract, assurance, bond, undertaking or guarantee under or pursuant to which it has guaranteed or endorsed the debts, obligations or Liabilities of any other Person, except as disclosed in the 128 Financial Statements.

4.16 128 Material Contracts

Section 4.16 of the 128 Disclosure Schedule sets forth a true and complete list of all Contracts to which 128 is a party or by which 128 is bound which is material to 128. Each such Contract is a valid and subsisting agreement, enforceable in accordance with the terms thereof and can be fulfilled and performed in all material respects by 128 in the 128 Ordinary Course. Each such Contract is unamended, is in full force and effect, in good standing and no event of default has occurred and is continuing and no event has occurred which, with the giving of notice, the lapse of time or both, would constitute an event of default by 128 under any such Contract. To the knowledge of 128, no event has occurred which, with the giving of notice, the passing of time or both, would constitute an event of default by any other party to any such Contract, 128 is not alleged to be in default of any of the provisions of such Contracts, and 128 is not aware of any disputes with respect thereto.

4.17 Other Contracts

128 is not a party to any Contract, the termination, expiry or non-renewal of which would reasonably be expected to have a 128 Material Adverse Effect.

4.18 Title to Property and Assets

128 and Subco have no material property or assets except as set forth in the 128 Financial

Statements.

4.19 Taxes and Governmental Charges

• (a) As of the date of this Agreement, 128 has:
  • (i) duly and in a timely manner filed all Tax Returns and reports required by Law to have been filed by it (except for such Tax Returns and reports with respect to which the failure to timely file would not reasonably be expected to have a 128 Material Adverse Effect), and all such Tax Returns and reports are true, correct and complete in all material respects;
  • (ii) duly kept all records which it is required to keep for Tax purposes or which would be needed to substantiate any claim made or position taken in relation to Tax by it, as applicable, and such records are available for inspection at the head office of 128;
  • (iii) duly and correctly reported all income and other amounts required to be reported;
  • (iv) paid all Taxes to the extent that such Taxes have been assessed by the relevant taxation authority; and
  • (v) duly and in a timely manner paid, deducted, withheld, collected and remitted all Governmental Charges (other than Governmental Charges that are not yet due) and has made full provision for (including properly accruing and reflecting on its books and records) all Governmental Charges that are not yet due, that relate to periods (or portions thereof) ending prior to the date of this Agreement, except where the failure to pay any such Governmental Charges, or make any such remittance, deduction or contribution or other amount would not reasonably be expected to have a 128 Material Adverse Effect.
• (b) The 128 Financial Statements contain adequate provision for all Taxes, assessments and levies imposed on 128, or its property or rights, arising since incorporation, regardless of whether such amounts are payable before or after the Effective Date.
• (c) No deficiency in payment of any Taxes for any period has been asserted against 128 by any Governmental Authority and remains unsettled at the date hereof.
• (d) No Tax Return of 128 is being audited by the relevant taxing authority. There are no outstanding waivers, objections, extensions or comparable consentsregarding the application of the statute of limitations or period of reassessment with respect to any Taxes or Tax

Returns that have been given or made by 128 (including the time for filing of Tax Returns or paying Taxes). To the knowledge of 128, there are no pending requests for any such waivers, extensions, or comparable consents. 128 has not received a ruling from any Governmental Authority or signed an agreement with any Governmental Authority that could reasonably be expected to have a 128 Material Adverse Effect.

• (e) There are no actions, suits, examinations, proceedings, investigations, audits or claims now pending or threatened or, to the knowledge of 128, contemplated against 128 in respect of any Taxes and there are no matters under discussion with any Governmental Authority relating to any Taxes.
• (f) 128 has not been subject to or is currently subject to any investigation, audit or visit by any Governmental Authority relating to Tax which has been notified to 128, and 128 is not aware of any such investigation, audit or visit planned for the next twelve months.

4.20 Absence of Litigation, etc.

There is not now in progress, pending or, to 128's knowledge, threatened or contemplated against or affecting 128, or any of its assets or properties, or any officer or director thereof in their capacity as an officer or director thereof, any litigation, action, suit, investigation, claim, complaint or other proceeding, including appeals and applications for review, by or before any Governmental Authority, which if determined adversely to 128, individually or in the aggregate, would reasonably be expected to have an 128 Material Adverse Effect.

4.21 Compliance with Laws

The business of 128 has been, and is now being, conducted and all of its assets have been, and are now being, used in compliance with all applicable Laws other than such non-compliance which would not reasonably be expected to have an 128 Material Adverse Effect, and no written notices have been received by 128 that the business of 128 is not being conducted or that any of such assets are not being used in compliance with all applicable Laws other than any non-compliance that would not reasonably be expected to have a 128 Material Adverse Effect.

4.22 Authorizations and Consents

• (a) Except for the approval of the Exchange contemplated in Section 7.01(c), no Authorization or declaration or filing with any Governmental Authority on the part of 128 is required for the valid execution, delivery and performance of its obligations under this Agreement or the completion of the Business Combination pursuant to this Agreement.
• (b) No consent, approval or waiver is required pursuant to the terms of any material Contract to which 128 is a party for the valid execution, delivery and performance of its obligations under this Agreement or the completion of the Business Combination pursuant to this Agreement.

4.23 Employment Matters and Employee Plans

(a) 128 does not have any employees or independent contractors (other than professional advisors engaged by 128 to provide services in connection with the Business Combination and for bookkeeping and accounting services).

• (c) 128 does not have any Employee Plans of any nature whatsoever nor has it ever had any such plans.
• (d) 128 is operating in full compliance with all Laws relating to employees, including employment standards, human rights, occupational health and safety, all pay equity and employment equity legislation other than such non-compliance which would not reasonably be expected to have a 128 Material Adverse Effect and there have been no employmentrelated complaints against 128.
• (e) To the knowledge of 128, there are no complaints or threatened complaints against 128 before any employment standards branch or tribunal or human rights commission or tribunal, nor any occurrence which might lead to a complaint under any human rights legislation, employment standards legislation, health and safety legislation, workers' compensation legislation or pay equity legislation.
• (f) There are no outstanding decisions or settlements or pending settlements under employment standards, human rights legislation, health and safety legislation, workers' compensation legislation, payment equity legislation or labour relations legislation which place any obligation upon 128 to do or refrain from doing any act or place a material financial obligation on 128.
• (g) There are no actions, suits or claims pending, threatened or reasonably anticipated (other than routine claims for benefits) against any Employee Plan or its assets, and there are no audits, inquiries or proceedings pending or, to the knowledge of 128, threatened by any Governmental Authority with respect to any Employee Plan, which in either case reasonably could be expected to result in material Liability to 128.
• (h) Neither the execution and delivery of this Agreement nor the performance of the obligations of 128 hereunder will entitle any current or former employee of 128 to any severance pay, bonus or other similar payment.

4.24 No Powers of Attorney

There are no outstanding powers of attorney or other authorizations granted by 128 to any third party to bind 128 to any Contract, Liability or obligation.

4.25 Insurance

128 does not have any insurance of any nature whatsoever relating to it, its assets, its business, or its directors or officers.

4.26 Authorizations

128 has all Authorizations necessary to conduct its business as presently conducted or for the ownership and use of the Assets in compliance with applicable Laws, except for any Authorizations the lack of which would not reasonably be expected to have a 128 Material Adverse Effect. 128 is not in default under, nor have it received any notice of any claim or default with respect to, any such Authorization. No registrations, filings, applications, notices, transfers, consents, approvals, audits, qualifications, waivers or other action of any kind is required by virtue of the execution and delivery of this Agreement, or of the consummation of the transactions contemplated hereby: (a) to avoid the loss of any Authorization or any asset, property or right pursuant to the terms thereof, or the violation or breach of any Law applicable thereto, or (b) to enable 128 to hold and enjoy any such Authorization, asset, property or right immediately after the Effective Date in the conduct of its business in the same manner as conducted prior to the Effective Date.

4.27 Fees and Commissions

128 is not a party to or bound by any Contract to pay any royalty, license fee or management fee. No broker, finder or similar intermediary has acted for or on behalf of or is entitled to any broker's, finder's or similar fee or other commission from 128 in connection with this Agreement.

4.28 Books and Records

The corporate records and minute books of 128 contain or, at or prior to the Business Combination will contain, in all material respects, complete and accurate minutes of all meetings of the directors and shareholders since its date of incorporation, together with the full text of all resolutions of directors and shareholders passed in lieu of such meetings, duly signed.

4.29 Restrictions on Business Combination

Except to the extent that 128 must comply with the policies of the Exchange and applicable Laws, 128 is not a party to or bound or affected by any commitment, agreement or document which would prohibit or restrict 128 from entering into and completing the Business Combination.

4.30 Reporting Issuer Status

128 is a "reporting issuer" in each of the Canadian Jurisdictions within the meaning of the Canadian Securities Laws, is in material compliance with its obligations as a reporting issuer, and none of the British Columbia Securities Commission or the Alberta Securities Commission, the Exchange or other Governmental Authority has issued any order preventing the Business Combination or the trading of any securities of 128.

4.31 Expenses and Obligations

128 has no obligations or commitments to incur any expenses of any sort whatsoever from the date hereof until completion of the Business Combination, other than general administrative expenses consistent with past practice and expenses relating to the completion of the Business Combination.

4.32 Share Issuance

Subject to applicable Canadian Securities Laws and the rules and policies of the Exchange, 128 has the full and lawful right and authority to issue 128 Shares to the McFarlane Common Shareholders, in connection with the Business Combination, and upon issuance such shares will be validly issued asfully paid and non-assessable common shares in the capital of 128 free and clear of all Encumbrances.

4.33 Public Disclosure Documents

128 is current in the filing of all public disclosure documents required to be filed by 128 under applicable Canadian Securities Laws (including all Contracts required by Canadian Securities Laws to be filed by 128), there are no filings that have been made thereunder on a confidential basis and all of such filings comply with the requirements of all applicable Canadian Securities Laws except where such noncompliance has not and would not reasonably be expected to have a 128 Material Adverse Effect.

4.34 No Misrepresentation

No portion of the Public Record contained a misrepresentation (as such term is defined in the Securities Act (Ontario)) as at its date of public dissemination or as at the date hereof.

4.35 Information Supplied

None of the information regarding 128 or its assets or business that was supplied by 128 specifically for inclusion or incorporation by reference into the Listing Statement will, at the time of initial submission of the Listing Statement to the Exchange, or at the time of any amendment or supplement thereof, as amended or supplemented at such date or time, contain any misrepresentation or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances under which they are made.

ARTICLE 5 SURVIVAL OF COVENANTS, REPRESENTATIONS AND WARRANTIES

5.01 Survival of Covenants, Representations and Warranties

No investigation by or on behalf of any party prior to the execution of this Agreement will mitigate, diminish or affect the representations and warranties made by the other parties. The representations and warranties of the parties contained in this Agreement will not survive the completion of the Business Combination and will expire and be terminated on the earlier of the Effective Time and the date on which this Agreement is terminated in accordance with its terms. This Section 5.01 will not limit any covenant or agreement of any of the parties, which, by its terms, contemplates performance after the Effective Time or the date on which this Agreement is terminated, as the case may be.

ARTICLE 6 COVENANTS

6.01 Access to McFarlane

McFarlane s will forthwith make available to 128 and its authorized representatives and, if requested by 128, provide a copy to 128 of all title documents, Contracts, financial statements, Constating Documents, minute books, share certificate books, share registers, plans, reports, licences, orders, permits, books of account, accounting records and all other documents, information or data relating to McFarlane and the McFarlane Business. McFarlane will afford 128 and its authorized representatives every reasonable opportunity to have access during normal business hoursto the McFarlane Business and the property, assets, undertaking, records and documents of McFarlane. At the request of 128, McFarlane will execute or cause to be executed such consents, authorizations and directions as may be necessary to permit any inspection of the McFarlane Business and any property of McFarlane or to enable 128 or its authorized representatives to obtain full access to all files and records relating to McFarlane and any of the assets of McFarlanemaintained by Governmental Authorities. At 128's request, McFarlane will co-operate with 128 in arranging any such meetings as 128 should reasonably request with:

• (a) employees, directors and officers of McFarlane;
• (b) persons who have or have had a business relationship with McFarlane and
• (c) auditors, solicitors or any other persons engaged or previously engaged to provide services to McFarlane who have knowledge of matters relating to McFarlane and the McFarlane Business.

6.02 Access to 128

128 will forthwith make available to McFarlane and its authorized representatives and, if requested by McFarlane, provide a copy to McFarlane of all title documents, Contracts, financial statements, Constating Documents, minute books, share certificate books, share registers, plans, reports, licences, orders, permits, books of account, accounting records and all other documents, information or data relating to 128 and its business. 128 will afford McFarlane and its authorized representatives every reasonable opportunity to have access, during normal business hours, to its business and the property, assets, undertaking, records and documents of 128. At the request of McFarlane, 128 will execute or cause to be executed such consents, authorizations and directions as may be necessary to permit any inspection of its business and any property of 128 or any of its subsidiaries or to enable McFarlane or its authorized representatives to obtain full access to all files and records relating to 128 or any of its subsidiaries and any of the assets of 128 or any of its subsidiaries maintained by Governmental Authorities. At McFarlane's request, 128 will co-operate with McFarlane in arranging any such meetings as McFarlane should reasonably request with:

• (a) employees, directors and officers of 128;
• (b) persons who have or have had a business relationship with 128; and
• (c) auditors, solicitors or any other persons engaged or previously engaged to provide services to 128 who have knowledge of matters relating to 128 and its business.

6.03 Confidentiality

• (a) Each party hereto agrees that it shall keep strictly confidential and shall not disclose, copy, reproduce or distribute, or cause or permit to be disclosed, copied, reproduced or distributed any information concerning another party hereto (the "Disclosing Party"), its business, operations, assets and liabilities, that was obtained from another party hereto (or such party's Representatives (as defined below)) including pursuant to Sections 6.01 and 6.02 hereof, respectively (the "Confidential Information") to anyone except (i) the receiving party's (the "Recipient") directors, officers, employees, Affiliates and advisors (the "Representatives") to whom disclosure is reasonably necessary for the purposes of, or in connection with, the transactions contemplated herein and who have agreed to be bound by the terms of this Agreement, or (ii) as otherwise consented to in writing by the Disclosing Party. Each Recipient shall use its best efforts to ensure that the Confidential Information remains strictly confidential and is not disclosed to or seen, used or obtained by any Person or entity except in accordance with the terms of this Agreement.
• (b) Prior to the Effective Date, each Recipient and its Representatives shall not use or cause to be used any Confidential Information for any purpose other than in connection with

evaluating, negotiating or advising in connection with the transactions contemplated herein, and at no time shall a Recipient or its Representatives otherwise use or cause to be used any Confidential Information for the benefit of itself or any other third party or in any manner adverse to, or to the detriment of, the Disclosing Party or its shareholders.

• (c) Each Recipient shall instruct its Representatives to whom it makes disclosure that the disclosure is made in confidence and shall be kept in confidence and used only in accordance with this Agreement. The Recipient is liable for any breach of the obligations under this Agreement committed by its Representatives.
• (d) Notwithstanding the foregoing,
  • (i) the obligations of the Recipient under this Section 6.03 shall not apply to any information that (A) is publicly available or becomes publicly available through no action or fault of the Recipient, (B) was already in the Recipient's possession or known to the Recipient prior to being disclosed or provided to the Recipient by or on behalf of the Disclosing Party, provided that the source of such information or material was not bound by a contractual, legal or fiduciary obligation of confidentiality to the Disclosing Party or any other party with respect thereto, (C) is obtained by the Recipient from a third party, provided that such third party has the lawful right to disclose the Confidential Information, or (D) is independently developed by the Recipient without reference to the Confidential Information; and
  • (ii) a Recipient may disclose Confidential Information if and to the extent legally required or compelled to do so by applicable Law or in any governmental, administrative or judicial process (the "Compelled Disclosure"). The Recipient shall provide the Disclosing Party with prompt written notice of any request or requirement for Compelled Disclosure and shall co-operate with the Disclosing Party as the latter may reasonably and lawfully request with respect to the form, timing and nature of any Compelled Disclosure or seeking a protective order or other appropriate remedy. The Recipient may disclose only such Confidential Information as is specifically required or compelled to be disclosed and shall continue to use its best efforts to preserve the confidentiality of the Confidential Information.
• (e) Upon the termination or rescission of this Agreement, each Recipient will promptly, if requested to do so by the Disclosing Party, destroy, or return to the Disclosing Party, all Confidential Information (including notes, writings and other material developed therefrom by Recipient) and all copies thereof and retain none for its files. The requirements of confidentiality set forth herein shall survive the return or destruction of such Confidential Information.
• (f) Each Recipient hereby agrees that itsfailure or threat of failure to perform any obligation or duty which it has agreed to perform under this Agreement may cause irreparable harm to the Disclosing Party, which harm cannot be adequately compensated for by monetary damages. It is further agreed by each Recipient that an order of specific performance, injunctive relief or other equitable relief (or any combination thereof) against the Recipient in the event of a breach or default, or the threat of a breach or default, under the terms of this Agreement would be equitable and would not work a hardship on the Recipient and accordingly, in such event the Disclosing Party, without any bond or other security being required and in addition to whatever other remedies are or might be available at law or in equity, shall have the right

to commence an action against the Recipient either to compel specific performance by, or to obtain injunctive relief or other equitable relief (or any combination thereof) against, the Recipient with respect to any such event.

(g) Each Recipient acknowledges that the Recipient is aware, and shall advise its Representatives, that Canadian Securities Laws prohibit any Person who has received material non-public information from an issuer from purchasing or selling securities ofsuch issuer or from communicating such information to any other Person.

6.04 Filings and Indemnification

• (a) 128 and McFarlane shall prepare and file, or cause to be filed, any filings required under any applicable Laws, or the rules and policies of the Exchange or other Governmental Authorities relating to the Business Combination and the Amalgamation, and shall provide on a timely basis such information to each other as is necessary to complete such filings.
• (b) 128 covenants and agrees: (i) to take, in a timely manner, all commercially reasonable actions and steps necessary in order that, effective as at the Effective Date, the 128 Shares, including for greater certainty, the 128 Shares issuable pursuant to the Business Combination, be listed and posted for trading on the Exchange; (ii) that, when received, 128 shall provide McFarlane with copies of the conditional and final approval of the Exchange respecting the Business Combination and the listing and posting for trading of the additional Resulting Issuer Shares to be issued pursuant to the Business Combination; and (iii) that, the distribution of Resulting Issuer Shares to the shareholders of McFarlane upon the completion of the Business Combination is exempt from the prospectus and registration requirements of the Canadian Securities Laws.
• (c) 128 shall indemnify and save McFarlane harmless from and against any and all liabilities, losses (except for loss of profits or consequential losses), claims, judgments, damages, expenses and costs (including, without limitation, reasonable legal fees and costs and expenses incurred in connection therewith) (collectively, the "Indemnifiable Damages") suffered or incurred by McFarlane as a result of any misrepresentation contained in the Listing Statement that arises from information specifically provided by 128 for inclusion in the Listing Statement in writing.
• (d) McFarlane shall indemnify and save 128 harmless from and against any Indemnifiable Damages suffered or incurred by 128 as a result of any misrepresentation contained in the Listing Statement that arises from information specifically provided by McFarlane for inclusion in the Listing Statement in writing.

6.05 Conduct of McFarlane Prior to Closing

Without in any way limiting any other obligations of McFarlane hereunder, during the period from the date hereof until the earlier of the Effective Date or the date this Agreement is terminated in accordance with its terms, McFarlane will use its commercially reasonable efforts to take, or cause to be taken, all action and to do, or cause to be done, all things necessary, proper or advisable (i) to consummate and make effective as promptly as practicable the transactions contemplated by this Agreement, (ii) to comply with all provisions of this Agreement and (iii) to cooperate with 128 in connection with the foregoing, including, without limitation, the following actions:

• (a) Conduct Business in the Ordinary Course. Other than as permitted under this Agreement including in connection with a Permitted Acquisition, McFarlane will conduct the McFarlane Business and its operations and affairs only in the McFarlane Ordinary Course and in a manner consistent with past practice and McFarlane will not, without the prior written consent of 128, take any action or enter into any transaction that, if effected before the date of this Agreement, would constitute a breach of any representation, warranty, covenant or other obligation of McFarlane contained herein, or which may interfere with or be inconsistent with the successful completion of the transactions contemplated herein.

• (b) Material Adverse Effects. McFarlane shall notify 128 of any McFarlane Material Adverse Effect.

• (c) Corporate Action. McFarlane will use its commercially reasonable efforts to take all necessary corporate action, steps and proceedings to approve or authorize, validly and effectively, the execution, delivery and performance of this Agreement and the other agreements and documents contemplated hereby and to complete the Business Combination and the transactions contemplated thereby, and to cause all necessary meetings of directors and shareholders of McFarlane to be held for such purpose. In particular, McFarlane will obtain the McFarlane Common Shareholder Approval as soon as practicable upon execution of this Agreement. McFarlane will not, in connection with the McFarlane Common Shareholder Approval, mail or otherwise transmit any information circular or form of proxy or other solicitation material to any Person in the United States except to McFarlane Common Shareholders resident in the United States.

• (d) Regulatory Consents. McFarlane will use its commercially reasonable efforts to obtain, prior to the completion of the Business Combination, from all appropriate Governmental Authorities, all Authorizations required as a condition of the lawful consummation of the Business Combination, including, without limitation, federal, departmental or municipal approvals under the Laws of the Canada and the provision of reasonable assistance to 128 to obtain the approval of the Exchange, and will affect all necessary registrations and other filings and submissions of information requested by Governmental Authorities in connection with the same.

• (e) Restrictive Covenants. McFarlane shall not, directly or indirectly, other than as permitted under this Agreement including in connection with the McFarlane Private Placement and a Permitted Acquisition:

  • (i) amend its Constating Documents;
  • (ii) issue, sell, pledge, hypothecate, lease, dispose of or encumber any of its shares or other securities, or any right, option or warrant with respect thereto;
  • (iii) split, combine or reclassify any of its securities or declare, pay or make any dividend or other distribution on the McFarlane Common Shares, or distribute any of its properties or Assets to any Person;
  • (iv) other than as disclosed to 128, enter into or amend any employment agreements with any director, officer or key employee, create or amend any Employee Plan, make any increases in the base compensation, bonuses, paid vacation time allowed or benefits for its directors, officers, employees or consultants;

• (v) hire or dismiss any employees whose total annual compensation exceeds $50,000 without the prior written consent of 128;

• (vi) other than in the McFarlane Ordinary Course, acquire or agree to acquire (by tender offer, exchange offer, merger, amalgamation, acquisition of shares or assets or otherwise) any Person, partnership, joint venture or other business organization or division or acquire or agree to acquire any material assets;

• (vii) create any stock option or bonus plan, pay any bonuses, deferred or otherwise, or defer any compensation to any of its directors, officers or employees;

• (viii) make any material change in accounting procedures or practices;

• (ix) mortgage, pledge or hypothecate any of its Assets, or subject them to any Encumbrance, other than a Permitted Encumbrance;

• (x) borrow any money or incur any indebtedness in an aggregate amount in excess of $50,000 (other than trade payables incurred in the McFarlane Ordinary Course), without the prior written consent of 128, not to be unreasonably withheld;

• (xi) make loans, advances or other similar payments to any party, excluding routine advances to employees for expenses incurred in the McFarlane Ordinary Course or as is reasonable agreed to by 128 in writing;

• (xii) make any capital expenditures in an amount exceeding $50,000 the aggregate without the prior written consent of 128, not to be unreasonably withheld;

• (xiii) enter into any Contract or arrangement granting any rights to purchase or lease any of its Assets or requiring the consent of any Person to the transfer, assignment or lease of any of its Assets;

• (xiv) enter into any transaction or material Contract not in the McFarlane Ordinary Course or engage in any business enterprise or activity different than the McFarlane Business, without the prior written consent of 128, not to be unreasonably withheld;

• (xv) sell, lease, sublease, assign or transfer (by tender offer, exchange offer, merger, amalgamation, sale of shares or assets or otherwise) any of its Assets;

• (xvi) cancel, waive or compromise any debts or claims, including accounts payable to and receivable from Affiliates;

• (xvii) enter into any other material transaction or any amendment of any Contract or Authorization which is material to the McFarlane Business;

• (xviii) settle any outstanding claim, dispute, litigation matter, or tax dispute;

• (xix) transfer any Assets to any of its shareholders or any of their subsidiaries or Affiliates or assume any indebtedness or Liability from a shareholder or any of their subsidiaries or Affiliates or enter into any other related party transactions;

• (xx) enter into any material Contract regarding its business operations, including any joint venture, partnership or other arrangement; or

• (xxi) enter into any agreement or understanding to do any of the foregoing.

• (f) Contractual Consents. McFarlane will give all notices and use its commercially reasonable efforts to obtain all waivers, consents and approvals required under any Contract to which McFarlane is a party or by which it is bound to consummate the transactions contemplated in this Agreement.

• (g) Preserve Goodwill. McFarlane will use its commercially reasonable efforts to preserve intact the McFarlane Business and the property, Assets, operations and affairs of McFarlane and to carry on the McFarlane Business and the affairs of McFarlane in the McFarlane Ordinary Course, and to maintain and preserve its business relationships and the goodwill of all persons having business relations with McFarlane.

6.06 Conduct of 128 Prior to Closing

Without in any way limiting any other obligations of 128 hereunder, during the period from the date hereof until the earlier of the Effective Date or the date this Agreement is terminated in accordance with its terms, 128 will use its commercially reasonable efforts to take, or cause to be taken, all action and to do, or cause to be done, all things necessary, proper or advisable (i) to consummate and make effective as promptly as practicable the transactions contemplated by this Agreement, (ii) to comply with all provisions of this Agreement and (iii) to cooperate with McFarlane in connection with the foregoing, including, without limitation, the following actions:

• (a) Conduct Business in the Ordinary Course. 128 will not carry on any business other than to pursue the Business Combination, and, other than with respect to the Subco Private Placement, 128 will not, without the prior written consent of McFarlane, take any action, enter into any transaction that, if effected before the date of this Agreement, would constitute a breach of any representation, warranty, covenant or other obligation of 128 contained herein, or which may interfere with or be inconsistent with the successful completion of the transactions contemplated herein.

• (b) Material Adverse Effects. 128 shall notify McFarlane of any 128 Material Adverse Effect.

• (c) Corporate Action. 128 will use its commercially reasonable efforts to take all necessary corporate action, steps and proceedings to approve or authorize, validly and effectively, the execution, delivery and performance of this Agreement and the other agreements and documents contemplated hereby and to complete the Business Combination and to cause all necessary meetings of directors and shareholders of 128 and Subco to be held for such purpose.

• (d) Name Change. 128 will use its commercially reasonable efforts to complete the 128 Name Change immediately prior to the completion of the Business Combination.

• (e) Restrictive Covenants. 128 shall not, directly or indirectly, other than in connection with the 128 Name Change, the 128 Share Split and the 128 Recapitalization:

  • (i) amend its Constating Documents;

• (ii) issue, sell, pledge, hypothecate, lease, dispose of or encumber any of its shares or other securities, or any right, option or warrant with respect thereto;

• (iii) split, combine or reclassify any of its securities or declare, pay or make any dividend or other distribution on the 128 Shares, or distribute any of its properties or assets to any Person;

• (iv) enter into or amend any employment agreements with any director, officer or key employee, create or amend any Employee Plan, make any increases in the base compensation, bonuses, paid vacation time allowed or benefits for its directors, officers, employees or consultants;

• (v) hire or dismiss any employees;

• (vi) acquire or agree to acquire (by tender offer, exchange offer, merger, amalgamation, acquisition of shares or assets or otherwise) any Person, partnership, joint venture or other business organization or division or acquire or agree to acquire any material assets;

• (vii) create any stock option or bonus plan, pay any bonuses, deferred or otherwise, or defer any compensation to any of its directors, officers or employees;

• (viii) make any material change in accounting procedures or practices;

• (ix) mortgage, pledge or hypothecate any of its assets, or subject them to any Encumbrance, other than a Permitted Encumbrance;

• (x) borrow any material sums of money or incur any indebtedness (other than in the ordinary course) in excess of $5,000 which shall exclude any expenses incurred in connection with the transactions contemplated by this Agreement or in connection with 128's annual financial statement audit, nor make loans, advances or similar payments to any party (excluding routine advances to employees of 128 for expenses incurred in the ordinary course), nor make any capital expenditures;

• (xi) enter into any Contract requiring the consent of any Person to the transfer, assignment or lease of any of its assets;

• (xii) enter into any other material transaction or any amendment of any Contract or Authorization which is material to its business, other than any transaction pursuant to which 128 settles outstanding Liabilitiesin consideration for cash or other assets;

• (xiii) settle any outstanding claim, dispute, litigation matter or tax dispute;

• (xiv) enter into any material Contract regarding its business operations, including any joint venture, partnership or other arrangement, other than any transaction pursuant to which 128 settles outstanding Liabilities in consideration for cash or other assets; or

• (xv) enter into any agreement or understanding to do any of the foregoing.

• (f) Regulatory Consents. 128 will use its commercially reasonable efforts to obtain, prior to the Business Combination, from all appropriate Governmental Authorities, the Authorizations required as a condition of the lawful consummation of the transactions contemplated by this Agreement, including the approval of the NEO, and will effect all necessary registrations and other filings and submissions of information requested by Governmental Authorities in connection with the same.

• (g) Contractual Consents. 128 will give any notices and use its commercially reasonable efforts to obtain any consents and approvals required under any Contract to which 128 is a party or by which it is bound to consummate the transactions contemplated hereby.

• (h) Contracts. 128 will not, without the prior written consent of McFarlane (such consent not to be unreasonably withheld or delayed), enter into any new Contract or amend the terms of any existing Contract to which it is a party except for the Contracts necessary to carry out the transactions contemplated in this Agreement, including the 128 Recapitalization.

• (i) Subco Private Placement. 128 will provide McFarlane with satisfactory evidence that it has completed the Subco Private Placement.

6.07 Standstill of McFarlane

Unless and until this Agreement is terminated pursuant to the terms hereof, McFarlane agrees not to solicit, initiate, knowingly encourage, cooperate with or facilitate (including by way of furnishing any Confidential Information or entering into any form of agreement, arrangement or understanding) the submission, initiation or continuation of any oral or written inquiries or proposals or expressions of interest regarding, constituting or that may reasonably be expected to lead to any activity, arrangement or transaction or propose any activities or solicitations in opposition to or in competition with the Business Combination, and without limiting the generality of the foregoing, not to induce or attempt to induce any other Person to initiate any offer, shareholder proposal, "business combination", "takeover bid,", "qualifying transaction", exempt or otherwise, within the meaning of the Canadian Securities Laws, for securities or Assets of McFarlane (other than pursuant to the McFarlane Private Placement or in connection with a Permitted Acquisition), nor to undertake any transaction or negotiate any transaction which would be or potentially could reasonably be in conflict with the Business Combination, including, without limitation, allowing access to any third party to conduct due diligence, nor to permit any of its officers or directors to do so, except as required by statutory obligations and in connection with a Permitted Acquisition, provided however McFarlane may enter into discussions or negotiations with a third party who (without any solicitation, initiation or encouragement, directly or indirectly, after the date of this Agreement, by McFarlane or any of its officers, directors or employees or any financial advisor, expert or other representative retained by it) seeks to initiate such discussions or negotiations and, subject to execution of a confidentiality and standstill (provided that such confidentiality agreement shall provide for disclosure thereof (along with all information provided thereunder) to 128) may furnish to such third party information concerning such party and McFarlane's business, properties and assets, in each case if, and only to the extent that the board of directors of McFarlane determines in good faith that engaging in such discussions or negotiations is necessary for the board of directors to discharge its fiduciary duties under applicable Laws. In the event McFarlane, including any of its officers or directors, receives any form of offer that it wishes to pursue, McFarlane shall forthwith (and in any event within one Business Day following receipt) notify 128 of such offer or inquiry and provide 128 with such details as it may request (the "McFarlane Offer").

6.08 Standstill of 128

(a) Unless and until this Agreement is terminated pursuant to the terms hereof, 128 agrees not to solicit, initiate, knowingly encourage, cooperate with or facilitate (including by way of furnishing any Confidential Information or entering into any form of agreement, arrangement or understanding) the submission, initiation or continuation of any oral or written inquiries or proposals or expressions of interest regarding, constituting or that may reasonably be expected to lead to any activity, arrangement or transaction or propose any activities or solicitations in opposition to or in competition with the Business Combination, and without limiting the generality of the foregoing, not to induce or attempt to induce any other Person to initiate any offer, shareholder proposal, "business combination", "takeover bid," or "qualifying transaction", exempt or otherwise, within the meaning of the Canadian Securities Laws or the policies of the Exchange, as applicable, for securities or assets of 128, nor to undertake any transaction or negotiate any transaction which would be or potentially could reasonably be in conflict with the Business Combination, including, without limitation, allowing access to any third party to conduct due diligence, nor to permit any of its officers or directors to do so, except as required by statutory obligations provided however 128 may enter into discussions or negotiations with a third party who (without any solicitation, initiation or encouragement, directly or indirectly, after the date of this Agreement, by 128 or any of its officers, directors or employees or any financial advisor, expert or other representative retained by it) seeks to initiate such discussions or negotiations and, subject to execution of a confidentiality and standstill (provided that such confidentiality agreement shall provide for disclosure thereof (along with all information provided thereunder) to McFarlane) may furnish to such third party information concerning such party and 128's business, properties and assets, in each case if, and only to the extent that the board of directors of 128 determines in good faith that engaging in such discussions or negotiations is necessary for the board of directors to discharge its fiduciary duties under applicable Laws. In the event 128, including any of its officers or directors, receives any form of offer that it wishes to pursue, 128 shall forthwith (and in any event within one Business Day following receipt) notify McFarlane of such offer or inquiry and provide McFarlane with such details as it may request (the "128 Offer").

6.09 Change to Directors and Officers of 128

Upon the completion of the Business Combination:

• (a) all of the directors of 128 will resign and there will be appointed in their place as directors of 128 such persons as McFarlane shall designate; and
• (b) all of the officers of 128 will resign and there will be appointed in their place as officers of 128 such persons as McFarlane shall designate.

ARTICLE 7 CONDITIONS OF CLOSING

7.01 Conditions in Favour of 128

The consummation of the Business Combination is subject to the following terms and conditions for the exclusive benefit of 128, to be fulfilled or performed at or prior to the Effective Time:

• (a) Constating Documents and Certificate of Corporate Existence. 128 shall have received from McFarlane: (i) a copy of the Constating Documents of McFarlane, certified by a duly authorized officer of McFarlane to be true and complete as of the Effective Date; and (ii) a certificate or the equivalent, dated not more than three days prior to the Effective Date, of the jurisdiction of incorporation of McFarlane as to the corporate good standing thereof.

• (b) Exchange Listing. The Exchange shall have conditionally approved the listing of the Resulting Issuer Shares, and all conditions shall been satisfied or are capable of being satisfied or waived in connection therewith.

• (c) Required Approvals. McFarlane shall have obtained the approval of its board of directors and shareholders, in accordance with the OBCA, for this Agreement and the Transactions contemplated hereby.

• (d) Proof of Corporate Action. 128 shall have received from McFarlane a copy, certified by a duly authorized officer thereof to be true and complete as of the Effective Date, of the records of all corporate action taken to authorize the execution, delivery and performance of this Agreement and the transactions contemplated hereby.

• (a) Representations and Warranties. The representations and warranties of McFarlane contained in this Agreement will be true and correct at the Effective Time with the same force and effect as if such representations and warranties were made at and as of such date (except the representations and warranties of McFarlane qualified by materiality or McFarlane Material Adverse Effect qualifications shall be true and correct in all respects and all other representations and warranties of McFarlane shall be true and correct in all material respects, in each case as of the Effective Time as if made on and as of such date except to the extent that such representations and warranties speak as of an earlier date, in which event such representations and warranties shall be accordingly true and correct as of such earlier date), and certificates of the Chief Executive Officer and the Chief Financial Officer of McFarlane dated the Effective Date will have been delivered to 128 confirming the foregoing.

• (b) Covenants. All of the terms, covenants and conditions of this Agreement to be complied with or performed by McFarlane at or before the Effective Time will have been complied with or performed in all material respects, and certificates of the Chief Executive Officer and the Chief Financial Officer of McFarlane dated the Effective Date will have been delivered to 128 confirming the foregoing.

• (c) Regulatory Consents. There will have been obtained, from all relevant Governmental Authorities, such Authorizations as are required to be obtained by McFarlane and 128 to consummate the Business Combination, including the approval of the Exchange for the listing on the Exchange of the Resulting Issuer Shares issuable pursuant to the Business Combination pursuant to the terms of this Agreement.

• (d) Exchange Escrow. On completion of the Business Combination, each of the parties as required by the Exchange shall have entered into an escrow agreement upon the terms and conditions imposed pursuant to the policies of the Exchange.

• (e) Contractual Consents. McFarlane will have given or obtained the notices, consents and approvals referred to in subsection 6.05(e), as applicable, in each case in form and substance satisfactory to 128, acting reasonably.

• (f) No Action or Proceeding. No bona fide legal or regulatory action or proceeding will be pending or threatened by any Person to enjoin, restrict or prohibit the Business Combination or any other of the transactions contemplated hereby, or the right of 128, Subco or McFarlane to conduct, expand, and develop their business.

• (g) No Material Adverse Effect. There will have been no McFarlane Material Adverse Effect since the date hereof and a certificate of the Chief Executive Officer and the Chief Financial Officer of McFarlane dated the Effective Date to that effect will have been delivered to 128.

• (h) Capitalization. Before giving effect to the securities issuable in connection with the McFarlane Private Placement or pursuant to a Permitted Acquisition, McFarlane shall have no securities issued and outstanding other than 74,747,500 McFarlane Common Shares, the McFarlane Warrants and the McFarlane Options.

• (i) Dissent Rights. Dissent Rights will not have been exercised in respect of a total number of McFarlane Common Shares which would, if such shares were converted into 128 Shares pursuant to the Business Combination, exceed 5% of the 128 Shares outstanding upon completion of the Business Combination.

If any of the conditions contained in this Section 7.01 have not been performed or fulfilled at or prior to the Effective Time to the satisfaction of 128, acting reasonably, 128 may, by notice to McFarlane, terminate this Agreement and the obligations of McFarlane and 128 under this Agreement. Any such condition may be waived in whole or in part by 128 without prejudice to any claimsit may have for breach of covenant, representation or warranty or otherwise.

7.02 Conditions in Favour of McFarlane

The consummation of the Business Combination is subject to the following terms and conditions for the exclusive benefit of McFarlane, to be fulfilled or performed at or prior to the Effective Time:

• (a) Constating Documents and Certificate of Corporate Existence. McFarlane shall have received: (i) a copy of the Constating Documents of each of 128 and Subco, certified by a duly authorized officer of 128 and Subco, as the case may be, to be true and complete as of the Effective Date; and (ii) a certificate or the equivalent, dated not more than three days prior to the Effective Date, of the jurisdiction of incorporation of each of 128 and Subco as to the corporate good standing thereof.

• (b) Exchange Listing. The Exchange shall have conditionally approved the listing of the Resulting Issuer Shares, together with any Resulting Issuer Shares issuable upon the conversion of securities of the Resulting Issuer outstanding on the Effective Date, and all conditions shall been satisfied or are capable of being satisfied or waived in connection therewith.

• (c) Required Approvals. Each of 128 and Subco shall have obtained the approval of its board of directors, and if required or permitted by the BCBCA and OBCA, as applicable, its shareholders, for this Agreement and the transactions contemplated hereby.

• (d) Proof of Corporate Action. McFarlane shall have received from each of 128 and Subco a copy, certified by a duly authorized officer thereof to be true and complete as of the Effective Date, of the records of all corporate action taken to authorize the execution, delivery and performance of this Agreement and the transactions contemplated hereby.

• (e) Name Change. The 128 Name Change and 128 Share Split will have been completed, and the 128 Continuation Resolution will have been approved.

• (f) Capitalization. There shall be no more than 3,750,000 128 Shares outstanding and no securities convertible into 128 Shares, and no more than 65,600 Subco Shares and 32,750 Subco Warrants outstanding.

• (g) Representations and Warranties. The representations and warranties of 128 contained in this Agreement will be true and correct at the Effective Time with the same force and effect as if such representations and warranties were made at and as of such date (except the representations and warranties of 128 qualified by materiality or 128 Material Adverse Effect qualifications shall be true and correct in all respects and all other representations and warranties of 128 shall be true and correct in all material respects, in each case as of the Effective Time as if made on and as of such date except to the extent that such representations and warranties speak as of an earlier date, in which event such representations and warranties shall be accordingly true and correct as of such earlier date), and certificates of the Chief Executive Officer and the Chief Financial Officer of 128 dated the Effective Date will have been delivered to McFarlane confirming the foregoing.

• (h) Covenants. All of the terms, covenants and conditions of this Agreement to be complied with or performed by 128 at or before the Effective Time will have been complied with or performed in all material respects, and a certificate of the Chief Executive Officer and the Chief Financial Officer of 128 dated the Effective Date will have been delivered to McFarlane confirming the foregoing.

• (i) Regulatory Consents. There will have been obtained, from all relevant Governmental Authorities, such Authorizations as are required to be obtained by McFarlane and 128 to consummate the Business Combination, including the approval of the Exchange for the listing on the Exchange of the Resulting Issuer Shares issuable pursuant to the Business Combination (including the exercise of the Resulting Issuer Replacement Broker Warrants issued in replacement for or in lieu of the McFarlane Broker Warrants pursuant to the terms of this Agreement), in each case in form and substance satisfactory to McFarlane, acting reasonably.

• (j) Contractual Consents. 128 will have given or obtained the notices, consents and approvals referred to in subsection 6.06(g), in each case in form and substance satisfactory to McFarlane, acting reasonably.

• (k) No Action or Proceeding. No bona fide legal or regulatory action or proceeding will be pending or threatened by any Person to enjoin, restrict or prohibit the Business Combination or any other of the transactions contemplated thereby, or the right of 128, Subco or McFarlane to conduct, expand and develop their business.

• (l) 128 Material Adverse Effect. There will have been no 128 Material Adverse Effect and a certificate of the Chief Executive Officer and the Chief Financial Officer of 128 dated the Effective Date to that effect will have been delivered to McFarlane.

• (m) Release by Directors and Officers. Each of the directors and officers of 128 who resigns as contemplated in Section 6.09 will have executed and delivered releases in favour of 128 in form and substance satisfactory to McFarlane, acting reasonably.

• (n) Dissent Rights. Dissent Rights will not have been exercised in respect of a total number of McFarlane Common Shares which would, if such shares were converted into 128 Shares pursuant to the Business Combination, exceed 5% of the 128 Shares outstanding upon completion of the Business Combination.

If any of the conditions in this Section 7.02 have not been performed or fulfilled at or prior to the Effective Time to the satisfaction of McFarlane, acting reasonably, McFarlane may, by notice to 128, terminate this Agreement and the obligations of McFarlane and 128 under this Agreement. Any such condition may be waived in whole or in part by McFarlane without prejudice to any claims it may have for breach of covenant, representation or warranty or otherwise.

7.03 Filing Articles

McFarlane and 128 will jointly file with the Director Articles of Amalgamation and such other documents as may be required to complete the Business Combination and effect the 128 Name Change as soon as practical and in any event within one Business Day after all conditions set out in Sections 7.01 and 7.02 have been satisfied or waived.

7.04 Further Assurances

Each party to this Agreement covenants and agrees that, from time to time prior to and subsequent to the Business Combination, it will execute and deliver all such documents, including all such additional conveyances, transfers, consents and other assurances and do all such other acts and things as the other party hereto, acting reasonably, may from time to time request be executed or done in order to better evidence or perfect or effectuate any provision of this Agreement or of any agreement or other document executed pursuant to this Agreement or any of the respective obligations intended to be created hereby or thereby.

ARTICLE 8 TERMINATION

8.01 Termination

This Agreement may be terminated at any time before the Effective Time:

• (a) by the mutual agreement of 128 and McFarlane;
• (b) by either of McFarlane or 128 by notice to the other party if a Governmental Authority has notified either party in writing that it will not permit the Business Combination to proceed;
• (c) by either of McFarlane or 128 by notice to the other party if there has been a misrepresentation, breach or non-performance by the breaching party of any representation, warranty, covenant or obligation contained in this Agreement, which could reasonably be

expected to have a 128 Material Adverse Effect or McFarlane Material Adverse Effective, as applicable, on the terminating party or the ability of either party to complete the Business Combination in accordance with the terms of this Agreement, provided the breaching party has been given notice of and ten (10) days to cure any such misrepresentation, breach or nonperformance;

• (d) by McFarlane if it delivers to 128 a McFarlane Offer pursuant to Section 6.07, in which case McFarlane shall pay to 128 $50,000 plus 128's reasonable out-of-pocket expenses incurred in connection with the negotiation of the transactions contemplated by this Agreement including the Letter of Intent by wire transfer of immediately available funds within five (5) Business Days from the date that 128 provides McFarlane with the quantum of the latter amount;
• (e) by McFarlane pursuant to Section 7.02;
• (f) by 128 if it delivers to McFarlane a 128 Offer pursuant to Section 6.08, in which case 128 shall pay to McFarlane the reasonable out-of-pocket expenses incurred by McFarlane in connection with the negotiation of the transactions contemplated by this Agreement including the Letter of Intent, by wire transfer of immediately available funds within five (5) Business Days from the date that McFarlane provides 128 with the quantum of such amount;
• (g) by 128 pursuant to Section 7.01;
• (h) by either McFarlane or 128, if the Business Combination has not been completed on or before March 31, 2022, or such later date as may be agreed to by McFarlane and 128 (provided, that the right to terminate this Agreement under this Section 8.01(h) shall not be available to any party whose failure to fulfill any of its obligations under this Agreement has been the cause of or resulted in the failure to consummate the transactions contemplated hereby by such date), in which case McFarlane shall pay to 128 $75,000 by wire transfer of immediately available funds within five (5) Business Days from the date a notice of termination is delivered pursuant to this Section 8.01(i);

provided that the right to terminate this Agreement and the right to receive any fee payable under this Agreement is not available to a party if it is in material breach of any representation, warranty or covenant hereof.

8.02 Effect of Termination

If this Agreement is terminated in accordance with Section 8.01:

• (a) this Agreement shall forthwith have no further force or effect and there shall be no obligation on the part of the parties hereunder except with respect to (i) Section 6.03, any fee payable under Section 8.01, Section 9.02, Section 9.06, Section 9.09, Section 9.11 and Section 9.12, which will survive such termination, and (ii) a breach arising from the fraud or wilful misconduct of any party; and
• (b) neither 128 nor McFarlane will have any further liability to the other party except as expressly contemplated hereby, provided that the termination of this Agreement (i) will not relieve either 128 nor McFarlane from any liability for breach by it of this Agreement prior to such termination or (ii) preclude a party from seeking injunctive relief to restrain any

breach or threatened breach of this Agreement or otherwise to obtain specific performance of any provision of this Agreement.

8.03 Waivers and Extensions

At any time prior to the earlier of the Effective Time or the termination of this Agreement in accordance with the provisions thereof, each of the parties hereto may (a) extend the time for the performance of any of the obligations or other acts of another party hereto, (b) waive any inaccuracies in the representations and warranties contained herein or in any document delivered pursuant hereto or (c) waive compliance with any of the agreements or conditions contained herein. Any such extension or waiver shall be valid if set forth in an instrument in writing signed by the party to be bound thereby.

ARTICLE 9 MISCELLANEOUS

9.01 Further Assurances

Each of the parties hereto will from time to time execute and deliver all such further documents and instruments and do all acts and things as the other party hereto may, either before or after the Business Combination, reasonably require to effectively carry out or better evidence or perfect the full intent and meaning of this Agreement.

9.02 Transaction Costs

Each party hereto will pay its respective costs and expenses (including but not limited to its legal and accounting costs) incurred in connection with the preparation, execution, delivery and performance of this Agreement and all documents and instruments executed pursuant to this Agreement and all transactions contemplated by this Agreement, and any other costs and expenses whatsoever and howsoever incurred. Notwithstanding the foregoing, McFarlane shall also be responsible for the reasonable fees (not to exceed $100,000 without written approval of McFarlane), disbursements and taxes of 128's legal counsel incurred in connection with the Business Combination.

9.03 Time of the Essence

Time is of the essence of this Agreement.

9.04 Public Announcements

The parties hereto shall not make any public announcement or press release concerning this Agreement or the matters contemplated herein, their discussions or any other memoranda, letters or agreements between the parties relating to the matters contemplated herein without the prior consent of each other, which consent shall not be unreasonably withheld, provided that no party shall be prevented from making any disclosure which is required to be made by Law or any rules of a stock exchange or similar organization by which it is bound.

9.05 Benefit of the Agreement

This Agreement will enure to the benefit of and be binding upon the respective successors and permitted assigns of the parties hereto.

9.06 Entire Agreement

This Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and cancels and supersedes any prior understandings and agreements between the parties hereto with respect thereto, including for greater certainty the Letter of Intent. The parties agree that the Letter of Intent is terminated upon the execution hereof. There are no representations, warranties, terms, conditions, undertakings or collateral agreements, express, implied or statutory, between the parties other than as expressly set forth in this Agreement.

9.07 Amendments and Waivers

No amendment to this Agreement will be valid or binding unless set forth in writing and duly executed by both of the parties hereto. No waiver of any provision of this Agreement will be effective or binding unless made in writing and signed by the party purporting to give the same and, unless otherwise provided, will be limited to the specific provision waived.

9.08 Assignment

This Agreement may not be assigned by a party hereto without the written consent of the other parties hereto, such consent not to be unreasonably withheld or delayed.

9.09 Notices

Any demand, notice or communication to be made or given under or pursuant to this Agreement isto be in writing, except as otherwise expressly permitted or required under this Agreement, and may be made or given by personal delivery, by registered mail or by transmittal by electronic mail addressed to the respective parties as follows:

(a) If to 128, then to the following address:

162 Lascelles Blvd. Toronto, Ontario M5P 2E6

Attention: Patrick McBride, Director and Chief Executive Officer Email: pat@hicksongroup.com

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

Borden Ladner Gervais LLP 520-3rd Avenue S.W., Suite 1900

Attention: Robb McNaughton@blg.com Email: rmcnaughton@blg.com

(b) If to McFarlane, then to the following address:

41 Field Street Lively, Ontario P3Y 1B5

Attention: Roger Emdin

Email: remdin@mcfarlanelakemining.com

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

Wildeboer Dellelce LLP Wildeboer Dellelce Place 365 Bay Street, Suite 800 Toronto, Ontario M5H 2V1

Attention: Al Wiens Email: awiens@wildlaw.ca

or to such other mailing or electronic mail address as any party may from time notify the others of in accordance with this paragraph. Any demand, notice or communication made or given by personal delivery is conclusively deemed to have been given on the day of actual delivery thereof or, if made or given by registered mail, on the fifth (5th) business day following the deposit thereof in the mail or, if made or given by electronic mail, on the day of transmittal thereof if given during the normal business hours of the recipient and on the business day during which such normal business hours next occur if not given during such hours on any day. If the party making or giving such demand, notice or communication knows, or ought reasonably to know, of difficulties with the postal system which might affect the delivery of mail, any such demand, notice or communication is not to be mailed but is to be made or given by personal delivery or by electronic mail transmission.

9.10 Remedies Cumulative

The right and remedies of the parties under this Agreement are cumulative and are in addition to, and not in substitution for, any other rights and remedies available at law or in equity or otherwise. No single or partial exercise by a party of any right or remedy precludes or otherwise affects the exercise of any other right or remedy to which that party may be entitled.

9.11 Governing Law

This Agreement is governed by and will be construed in accordance with the laws of the Province of Ontario and the federal laws of Canada applicable therein, without giving effect to any choice or conflict of law provision or rule that would cause the application of the domestic substantive laws of any other jurisdiction.

9.12 Attornment

For the purpose of all legal proceedings, this Agreement will be deemed to have been performed in the Province of Ontario and the courts of the Province of Ontario will have jurisdiction to entertain any action arising under this Agreement. Each party hereto hereby attorns to the jurisdiction of the courts of the Province of Ontario.

9.13 Counterparts

This Agreement may be executed in any number of counterparts, each of which will be deemed to be an original and all of which taken together will be deemed to constitute one and the same instrument.

Delivery of an executed signature page to this Agreement by either party by electronic transmission will be as effective as delivery of a manually executed copy of this Agreement by such party.

[The remainder of this page has been left intentionally blank. Signature page follows.]

IN WITNESS WHEREOF the parties have executed this Agreement as of the date first written above.

1287401 B.C. LTD.

By: (signed) James Ward Name: James Ward Title: Chief Executive Officer

1000034047 ONTARIO INC.

By: (signed) James Ward Name: James Ward Title: President

MCARLANE LAKE MINING INCOPORPRATED

By: (signed) Mark Trevisiol Name: Mark Trevisiol Title: Chief Executive Officer and President

SCHEDULE A AMALGAMATION AGREEMENT

THIS AGREEMENT made as of the 14th day of January, 2022.

B E T W E N:

MCFARLANE LAKE MINING INCORPORATED

existing under the Business Corporations Act (Ontario)

(hereinafter referred to as "McFarlane")

• and -

1000034047 ONTARIO INC. existing under the Business Corporations Act (Ontario)

(hereinafter referred to as "Subco")

• and -

1287401 B.C. LTD. existing under the Business Corporations Act (British Columbia)

(hereinafter referred to as "128")

WHEREAS:

• 1. The parties hereto have entered into a business combination agreement dated as of January 12, 2022 pursuant to which the parties thereto have agreed that the business and assets of McFarlane will be combined with those of Subco (the "Business Combination Agreement").
• 1. The authorized capital of Subco consists of an unlimited number of common shares of which 65,600 are issued and outstanding as fully paid and non-assessable common shares in the capital of Subco.

The authorized capital of McFarlane consists of an unlimited number of common shares ("McFarlane Common Shares") of which 74,747,500 are issued and outstanding as fully paid and non-assessable common shares in the capital of McFarlane.

• 1. Subco and McFarlane have agreed to amalgamate under the OBCA (as hereinafter defined) upon the terms and conditions hereinafter set out.
• 1. Effective upon the Amalgamation (as hereinafter defined), 128 shall issue to each McFarlane Common Shareholder (as hereinafter defined) one common share in its capital for each one McFarlane Common Share (as hereinafter defined).

NOW THEREFORE, in consideration of the mutual covenants and agreements contained herein and other good and valuable consideration (the receipt and sufficiency of which are hereby acknowledged), the parties hereto do hereby agree as follows:

1. Interpretation

In this Agreement, including the recitals:

"128 Shares" means common shares in the capital of 128;

"Agreement" means this amalgamation agreement, as it may be amended or supplemented at any time and from time to time after the date hereof;

"Amalco" means the corporation resulting from the amalgamation of Subco and McFarlane pursuant to the Amalgamation;

"Amalco Shares" means the common shares in the capital of Amalco;

"Amalgamating Corporation" means either of Subco or McFarlane and "Amalgamating Corporations" means both of them;

"Amalgamation" means the amalgamation of the Amalgamating Corporations under Section 174 of the OBCA on the terms and subject to the conditions set out in this Agreement;

"Business Combination" means the business combination among 128, Subco and McFarlane pursuant to which McFarlane Common Shareholders and Subco Shareholders will receive one 128 Shares for each McFarlane Common Share and Subco Share held and 128 will become the parent company of Amalco;

"Business Combination Agreement" has the meaning ascribed thereto in the preamble to this Agreement;

"Certificate of Amalgamation" means the certificate of amalgamation to be issued by the Director in respect of the Amalgamation;

"Director" means the director appointed under Section 278 of the OBCA;

"Dissenting McFarlane Common Shareholder" means a McFarlane Common Shareholder who dissents from the McFarlane Amalgamation Special Resolution in compliance with the OBCA;

"Effective Date" means the date shown on the Certificate of Amalgamation;

"Effective Time" has the meaning ascribed to it in Section 12;

"Exchange" means the Aequitas NEO Exchange Inc. or any other recognized stock exchange on which the Resulting Issuer Shares are to be listed for trading;

"Government Authority" means and includes, without limitation, any foreign, national, provincial, local or state government, or political subdivision of any government, judicial, public or statutory instrumentality, court, tribunal, commission, board, agency (including those pertaining to health, safety or the environment), authority, body or entity, or other regulatory bureau, authority, body or entity having legal jurisdiction over the activity or Person in question and, for greater certainty, includes the Exchange;

"McFarlane Amalgamation Special Resolution" means the special resolution of the shareholders of McFarlane approving the Amalgamation;

"McFarlane Common Shareholder" means a registered holder of McFarlane Common Shares, from time to time, and "McFarlane Common Shareholders" means all of such holders;

"McFarlane Common Shares" means common shares in the capital of McFarlane;

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

"Parties" means Subco and McFarlane;

"Person" includes any individual, sole proprietorship, firm, partnership, joint venture, venture capital fund, limited liability company, unlimited liability company, association, trust, trustee, executor, administrator, legal personal representative, estate, group, body corporate, corporation, unincorporated association or organization, union, Government Authority, syndicate or other entity, whether or not having legal status;

"Subco Shareholder" means the holders of Subco Shares;

"Subco Shares" means common shares in the capital of Subco; and

"Transfer Agent" means the registrar and transfer agent of 128.

2. Paramountcy

In the event of any conflict between the provisions of this Agreement and the provisions of the Business Combination Agreement, the provisions of the Business Combination Agreement shall prevail.

3. Agreement to Amalgamate

Each of the Parties hereby agrees to the Amalgamation. The Amalgamating Corporations shall amalgamate to create Amalco on the terms and conditions set out in this Agreement.

4. Amalgamation Events

Under the Amalgamation, at the Effective Time:

• (a) the Amalgamating Corporations shall be amalgamated and shall continue as one corporation effective on the date of the Certificate of Amalgamation under the terms and conditions prescribed in this Agreement;
• (b) the Amalgamating Corporations shall cease to exist as entities separate from Amalco;
• (c) Amalco shall possess all the property, rights, privileges and franchises and be subject to all the liabilities, including civil, criminal and quasi-criminal, and all the contracts, disabilities and debts of each of the Amalgamating Corporations;
• (d) a conviction against, or ruling, order or judgment in favour of or against an Amalgamating Corporation may be enforced by or against Amalco;
• (e) the Articles of Amalgamation of Amalco shall be deemed to be the articles of incorporation of Amalco, and the Certificate of Amalgamation, except for purposes of subsection 117(1) of the OBCA, shall be deemed to be the certificate of incorporation of Amalco; and

(f) Amalco shall be deemed to be the party plaintiff or the party defendant, as the case may be, in any civil action commenced by or against an Amalgamating Corporation before the Amalgamation has become effective.

All rights of creditors against the property, rights and assets of the Amalgamating Corporations and all liens upon their property, rights and assets shall be unimpaired by such amalgamation and all debts, contracts, liabilities and duties of the Amalgamating Corporations shall attach to Amalco and may be enforced against it. No action or proceeding by or against any of the Amalgamating Corporations shall abate or be affected by the Amalgamation.

5. Issuance of Shares

At the Effective Time, the authorized but unissued shares and the issued and outstanding shares in the capital of the Amalgamating Corporations shall be respectively converted into issued shares in the capital of Amalco or 128 as follows:

• (a) each one McFarlane Common Share (other than McFarlane Common Shares held by a Dissenting McFarlane Common Shareholder) shall be exchanged for one fully-paid and nonassessable 128 Share;
• (b) each one Subco Share (other than Subco Shares held by 128) shall be exchanged for one fully paid and non-assessable 128 Share;
• (c) each Subco Share held by 128 shall be cancelled;
• (d) as consideration for the issuance of the 128 Shares to effect the Amalgamation, 128 will receive one Amalco Share for each one 128 Share issued to holders of McFarlane Common Shares and Subco Shares; and
• (e) Amalco will be a wholly-owned subsidiary of 128.

6. Delivery of Securities Following Amalgamation

In accordance with normal commercial practice, as soon as practicable but in any event within three business days following the Effective Date, 128, directly or through the Transfer Agent, shall issue certificates, or direct registration system ("DRS") advices, representing the appropriate number of 128 Shares to the former McFarlane Common Shareholders (other than Dissenting McFarlane Common Shareholders) and Subco Shareholders by delivering such certificates, or DRS advices, to the address set out in the minute books of McFarlane in exchange for certificates (if issued, representing such McFarlane Common Shares). Certificates formerly representing McFarlane Common Shares and Subco Shares shall cease to represent any claim upon or interest in McFarlane or Subco, respectively, other than the right of the registered holder to receive the number of 128 Shares to which it is entitled pursuant to the terms hereof.

7. Lost Certificates

In the event any certificate which immediately prior to the Effective Date represented one or more outstanding McFarlane Common Shares or Subco Shares, as the case may be, that are to be exchanged pursuant to Section 5 hereof shall have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the holder thereof, as applicable, claiming such certificate to be lost, stolen or destroyed, the Transfer Agent will issue in exchange for such lost, stolen or destroyed certificate, one or more certificates representing one or more of 128 Shares to which they are entitled and, in each case, deliverable pursuant to Section 6 hereof. In exchange for any lost, stolen or destroyed certificate, the holder to whom such certificates representing such securities are to be issued shall, as a condition precedent to the issuance thereof, give a bond or fee,satisfactory to the Transfer Agent in such sum as 128 may direct or otherwise indemnify 128 in a manner satisfactory to 128 against any claim that may be made against 128 with respect to the certificate alleged to have been lost, stolen or destroyed.

8. Extinguishment of Rights

Any certificate which immediately prior to the Effective Time represented outstanding McFarlane Common Shares that are not held by a Dissenting McFarlane Common Shareholder who is ultimately entitled to be paid fair value of the McFarlane Common Shares held by such Dissenting McFarlane Common Shareholder but was exchanged or was deemed to have been exchange pursuant to Section 5 hereof, that has not been deposited with all other instruments required by the Transfer Agent on or prior to the second anniversary of the Effective Date shall cease to represent a claim or interest of any kind or nature as a holder of 128 Shares. On such date, 128 Shares (and any dividends or distributions with respect thereto) to which the former holder of the certificate referred to in the preceding sentence was ultimately entitled shall be deemed to have been surrendered for no consideration to 128, together with all entitlements to dividends, distributions and interest in respect thereof held for such former holder. None of McFarlane, 128 or the Transfer Agent shall be liable to any Person in respect of any 128 Shares (or dividends or distributions) delivered to a public official pursuant to and in compliance with any applicable abandoned property, escheat or similar applicable law.

9. Dissent Rights

Registered McFarlane Common Shareholders may exercise rights of dissent ("Dissent Rights") from the special resolution adopting this Agreement pursuant to and in the manner set forth in Section 185 of the OBCA, provided that holders who exercise such rights of dissent and who:

• (a) are ultimately entitled to be paid fair value for their McFarlane Common Shares, which fair value shall be the fair value of such shares as at the date specified in Section 185 of the OBCA; and
• (b) are ultimately not entitled, for any reason, to be paid fair value for their McFarlaneCommon Shares shall be deemed to have participated in the Amalgamation, as of the Effective Time, on the same basis as a non-dissenting holder of McFarlane Common Shares and shall be entitled to receive only the consideration contemplated in Section 5 hereof that such holder would have received pursuant to the Amalgamation if such holder had not exercised dissent rights,

but in no case shall 128, McFarlane or Subco or any other Person be required to recognize holders of McFarlane Common Shares who exercise Dissent Rights as holders of 128 Shares after the time specified in the OBCA, and the names of such holders of McFarlane Common Shares who exercise Dissent Rights shall be deleted from the register of McFarlane Common Shareholders at the Effective Time.

10. Fractional Shares

No fractional 128 Shares will be issuable to McFarlane Common Shareholders or Subco Shareholders pursuant to the Amalgamation, and no cash payment or other form of consideration will be payable in lieu thereof. In the event that the former holder of McFarlane Common Shares or Subco Shareholder is entitled to receive a fractional 128 Share, any such fractional 128 Share interest to which a McFarlane Common Shareholder or Subco Shareholder would otherwise be entitled pursuant to the Amalgamation will be rounded down to the nearest whole 128 Share.

11. Filing of Articles of Amalgamation

If this Agreement is adopted by each Amalgamating Corporation as required by the OBCA, the Amalgamating Corporations agree that they will, jointly and together, file with the Director, agreed upon Articles of Amalgamation in the form prescribed under the OBCA.

12. Effective Time

The Amalgamation shall take effect and go into operation at 12:01 a.m. on the Effective Date, if this Agreement has been adopted as required by law and all necessary filings have been made with the Director before that time, or at such later time, or time and date, as may be determined by the directors or by special resolutions of the Amalgamating Corporations when this Agreement shall have been adopted as required by law; provided, however, that if this Agreement isterminated under Section 20 hereof, the Amalgamation shall not take place notwithstanding the fact that this Agreement may have been adopted by the shareholders of the Amalgamating Corporations.

13. Amalco Name

The name of Amalco shall be "McFarlane Lake Mining Incorporated".

14. Registered Office

The registered office of Amalco shall be in the City of Sudbury in the Province of Ontario. The address of the first registered office of Amalco shall be: 15 Kincora Court, Sudbury, Ontario, P3E 2B9.

15. Activities

• (a) Restrictions on Share Transfer. The right to transfer shares of Amalco shall be restricted in that no shareholder shall be entitled to transfer any share or shares without either:

  • (i) the approval of the directors of Amalco expressed by a resolution passed at a meeting of the board of directors or by a resolution in writing signed by all of the directors entitled to vote on that resolution at a meeting of directors; or
  • (ii) the approval of the holders of shares of Amalco carrying at least a majority of the votes entitled to be cast at a meeting of shareholders, expressed by a resolution passed at a meeting of the holders of such shares or by an instrument or instruments in writing signed by the holders of a majority of such shares.

• (b) Restrictions on Business. There shall be no restrictions on the business that Amalco may carry on.

• (c) Fiscal Year. The fiscal year end of Amalco shall be December 31 of each year.

• (d) By-laws. The by-laws of Amalco shall be in the form of the by-laws of Subco.

• (e) Special Provisions. Subject to the provisions of the OBCA, the following provisions shall apply to Amalco:

• A. borrow money upon the credit of Amalco;

• B. issue, re-issue, sell or pledge debt obligations of Amalco;

• C. subject to the provisions of the OBCA, as now enacted or as the same may from time to time be amended, re-enacted or replaced, give a guarantee on behalf of Amalco to secure performance of an obligation of any Person; and

• D. mortgage, hypothecate, pledge or otherwise create a security interest in all or any property of Amalco owned or subsequently acquired, to secure any obligation of Amalco; and

• (ii) The board of directors may from time to time delegate to a director, a committee of directors or an officer of Amalco any or all of the powers conferred on the board as set out above, to such extent and in such manner as the board shall determine at the time of such delegation.

16. Authorized Capital

The authorized capital of Amalco shall consist of an unlimited number of common shares without nominal or par value.

17. Capital

The amount to be added to the stated capital in respect of the Amalco Shares issuable by Amalco pursuant to Sections 4(e) and 4(f) of this Agreement shall be the aggregate of: (i) the paid-up capital for purposes of the Income Tax Act (Canada), determined before the Effective Time, of the Subco Shares converted into Amalco Shares pursuant to Section 4(e); and (ii) the paid-up capital for purposes of the Income Tax Act (Canada), determined before the Effective Time, of all of the issued and outstanding McFarlane Common Shares immediately before the Effective Time (other than any McFarlane Common Shares held by Subco, if any).

18. Number of Directors

The board of directors of Amalco shall consist of a minimum of 1 director and a maximum of 10 directors, until changed in accordance with the OBCA. Until changed by special resolution of the shareholders of Amalco, or if the directors of Amalco are so authorized by special resolution of the shareholders of Amalco, by resolution of the said directors, the board of directors of Amalco shall consist of one director.

19. Initial Directors

The first director of Amalco shall be the person whose names and residential addresses appear below:

Name	Prescribed Address
Mark Trevisiol	15 Kincora Court, Sudbury, Ontario, P3E 2B9

The above director will hold office from the Effective Date until the first annual meeting of shareholders of Amalco or until his successor is elected or appointed.

20. Termination

This Agreement may be terminated by the board of directors of each of the Amalgamating Corporations, notwithstanding the approval of this Agreement by the shareholders of the Amalgamating Corporations, at any time prior to the issuance of the Certificate of Amalgamation and following the termination of the Business Combination Agreement, without, except as provided in the Business Combination Agreement, any recourse by any Party hereto or any of their shareholders or other Persons.

21. Governing Law

This Agreement shall be governed by, and construed in accordance with, the laws of the Province of Ontario and the federal laws of Canada applicable therein. Each Party hereby irrevocably attorns to the jurisdiction of the courts of the Province of Ontario in respect of all matters arising under or in relation to this Agreement.

22. Further Assurances

Each of the Parties agrees to execute and deliver such further instruments and to do such further reasonable acts and things as may be necessary or appropriate to carry out the intent of this Agreement.

23. Time of the Essence

Time shall be of the essence of this Agreement.

24. Amendments

This Agreement may only be amended or otherwise modified by written agreement executed by the Parties.

25. Counterparts

This Agreement may be signed in counterparts (including counterparts by facsimile, PDF or other electronic means), and all such signed counterparts, when taken together, shall constitute one and the same agreement, effective on this date.

IN WITNESS WHEREOF the parties have executed this Agreement as of the date first written above.

1287401 B.C. LTD.

By: (signed) James Ward Name: James Ward Title: Chief Executive Officer

1000034047 ONTARIO INC.

By: (signed) James Ward Name: James Ward Title: President

MCARLANE LAKE MINING INCOPORPRATED

By: (signed) Mark Trevisiol Name: Mark Trevisiol Title: Chief Executive Officer and President

SCHEDULE B MCFARLANE DISCLOSURE SCHEDULE

Section 1.01: McFarlane Warrants

• Warrants underlying Units: 3,977,500
• Warrants underlying Broker and Advisory Warrants: 548,537
• Warrant underlying corporate finance fee: 195,906

Total = 4,721,943 Warrants I/O

Section 3.02: Encumbrances

The Mineral Properties are subject to certain existing royalties, as follows:

Date ofRoyaltyAgreement	SubjectClaims	Term	OriginalPayor	OriginalHolder	CurrentHolder	Royalty %andDetails	BuydownProvisions(Y/N)	Notes
May 12,2019	AllMcMillanMineClaims	Inperpetuity	Canadian StarMinerals Ltd.	QMX GoldCorporation	QMX GoldCorporation	2% NSR	No
June 15,2006	High LakeClaims	Inperpetuity	InternationalMillenniumMining Corp.	CeylnnAlcock	CeylnnAlcock	2% NSR	Yes – right topurchase 50%of the NSRfor a one timepayment of$1,250,000.	Ifcommercialproductionhas notcommencedby June 14,2010, theRoyaltyHolder isentitled to a$10,000payment onJune 15 ofevery year

Section 3.15(a):

Pursuant to the Definitive Property Purchase Agreement, McFarlane has purchased and acquired all of CSM's right, title and interest in and to the McFarlane Mineral Properties. McFarlane has agreed to, among other thing, pay $2,750,000 in cash and issue the Consideration Sharesto CSM in consideration for the McFarlane Mineral Properties, of which McFarlane has paid $750,000 upon transfer of the claims representing the McMillan Mine Property. The remainder of the cash consideration and the issuance of the Consideration Shares will occur upon transfer of legal title to the leases comprising the High Lake Property and the West Hawk Lake Property to McFarlane in the relevant land titles or similar office.

McFarlane material properties

McMillan Mine, Ontario, Canada (all Unpatented Mining Claims)

Claim#	Type	Status	Issue	Anniversary	Owner Client#	Area /# of	Due Date
			Date	Date		Cells
106636	Claim	Active	2018-04-	2021-09-02	(405870) CANADIAN	1	2021-09-
			10		STARMINERALS		02
					LTD.
144179	Claim	Active	2018-04-	2021-06-03	(405870) CANADIAN	1	2021-06-
			10		STARMINERALS		03
					LTD.
148095	Claim	Active	2018-04-	2021-09-02	(405870) CANADIAN	1	2021-09-
			10		STARMINERALS		02
					LTD.
165931	Claim	Active	2018-04-	2021-09-02	(405870) CANADIAN	1	2021-09-
			10		STARMINERALS		02
					LTD.
181970	Claim	Active	2018-04-	2021-09-02	(405870) CANADIAN	1	2021-09-
			10		STARMINERALS		02
					LTD.
184120	Claim	Active	2018-04-	2021-06-03	(405870) CANADIAN	1	2021-06-
			10		STARMINERALS		03
					LTD.
237414	Claim	Active	2018-04-	2021-09-02	(405870) CANADIAN	1	2021-09-
			10		STARMINERALSLTD.		02
246043	Claim	Active	2018-04-	2021-09-02	(405870) CANADIAN	1	2021-09-
			10		STARMINERALS		02
					LTD.
246044	Claim	Active	2018-04-	2021-06-03	(405870) CANADIAN	1	2021-06-
			10		STARMINERALS		03
					LTD.
289949	Claim	Active	2018-04-	2021-06-03	(405870) CANADIAN	1	2021-06-
			10		STARMINERALS		03
					LTD.
301403	Claim	Active	2018-04-	2021-09-02	(405870)CANADIAN	1	2021-09-
			10		STARMINERALS		02
					LTD.
306223	Claim	Active	2018-04-	2021-09-02	(405870) CANADIAN	1	2021-09-
			10		STARMINERALS		02
					LTD.

High Lake, Ontario, Canada

Lease #	Township	UnderlyingClaims	Parcel #	Lease ExpiryDate	Hectares	LeaseTerm	PIN	Title Holder
107822(original LeaseNo. 2476)	Ewart	K20694	2402LK	31-Dec-2026	12.3	21 year	42149-0060(LT)	Celynn Kathleen Roberta AlcockNote:there is an assignment of Leasehold Interest toCanadian Star Minerals Ltd. registered on title –LR'sOrder should be registered to reflect new owner as"Canadian Star Minerals Ltd."
107823(original LeaseNo. 2477)	Ewart	K20695	2403DKL	31-Dec-2026	16.2	21year	42149-0054(LT)	Celynn Kathleen Roberta AlcockNote:there is an assignment of Leasehold Interest toCanadian Star Minerals Ltd. registered on title –LR'sOrder should be registered to reflect new owner as"Canadian Star Minerals Ltd."
107819(original LeaseNo. 2478)	Ewart	K20696	2404DKL	31-Dec-2026	13.6	21 year	42149-0049(LT)	Celynn Kathleen Roberta Alcockthere is an assignment of Leasehold Interest toNote:Canadian Star Minerals Ltd.registered on title –LR'sOrder shouldbe registered to reflect new owneras"Canadian Star Minerals Ltd."
107820(original LeaseNo. 2479)	Ewart	K20697	2405DKL	31-Dec-2026	19.8	21 year	42149-0050(LT)	Celynn Kathleen Roberta AlcockNote:there is an assignment of Leasehold Interest toCanadianStar MineralsLtd. registered on title –LR'sOrder should be registered to reflect new owner as"Canadian Star Minerals Ltd."
107821(original LeaseNo. 2480)	Ewart	K21479	2406DKL	31-Dec-2026	21.0	21 year	42149-0048(LT)	Celynn Kathleen Roberta AlcockNote:there is an assignment of Leasehold Interest toCanadian Star Minerals Ltd. registered on title –LR'sOrder shouldbe registered to reflect new owner as"Canadian Star Minerals Ltd."
108321(original LeaseNo. 2733)	Ewart	K23980	2426DKL	30-Sep-2029	16.5	21 year	42149-0061(LT)	Canadian Star Minerals Ltd.

-	13	-
---	----	---

108320(original LeaseNo. 2732)	Ewart	K24136	2425DKL	30-Sep-2029	19.3	21 year	42149-0062(LT)	Canadian Star Minerals Ltd.
108328(original LeaseNo. 2731)	Ewart	K24137	2424DKL	30-Sep-2029	17.7	21year	42149-0068(LT)	Canadian Star Minerals Ltd.
108018(original LeaseNo. 2514)	Ewart	K25128	2411DKL	29-Feb-2028	13.6	21 year	42149-0075(LT)	Celynn Kathleen Roberta AlcockNote:there is an assignment of Leasehold Interest toCanadian Star Minerals Ltd. registered on title –LR'sOrder should be registered to reflect new owner as"Canadian Star Minerals Ltd."
108019(original LeaseNo. 2513)	Ewart	K25129	2410DKL	29-Feb-2028	22.2	21 year	42149-0076(LT)	Celynn Kathleen Roberta AlcockNote:there is an assignment of Leasehold Interest toCanadian Star Minerals Ltd. registered on title –LR'sOrder should be registered toreflect new owner as"Canadian Star Minerals Ltd."
107824(original LeaseNo. 2472)	Ewart	K25130	2398DKL	31-Dec-2026	18.0	21 year	42149-0124(LT)	Celynn Kathleen Roberta AlcockNote:there is an assignment of Leasehold Interest toCanadian Star Minerals Ltd. registered on title –LR'sOrder should be registered to reflect new owner as"Canadian Star Minerals Ltd."
107825(originalLeaseNo. 2473)	Ewart	K25131	2399DKL	31-Dec-2026	15.1	21 year	42149-0125(LT)	Celynn Kathleen Roberta AlcockNote:thereis an assignment of Leasehold Interest toCanadian Star Minerals Ltd. registered on title–LR'sOrder should be registered to reflect new owner as"Canadian Star Minerals Ltd."
108314(original LeaseNo. 2754)	Ewart	K25132	2427DKL	30-Nov-2029	16.9	21year	42149-0070(LT)	Celynn Kathleen Roberta AlcockNote:there is an assignment of Leasehold Interest toCanadian Star Minerals Ltd. registered on title –LR'sOrder should be registered to reflect new owner as"Canadian Star Minerals Ltd."

108316(original LeaseNo. 2755)	Ewart	K25133	2428DKL	30-Nov-2029	8.7	21 year	42149-0071(LT)	Celynn Kathleen Roberta Alcockthere is an assignment of Leasehold Interest toNote:Canadian Star Minerals Ltd. registered on title –LR'sOrder should be registered to reflect new owner as"Canadian Star Minerals Ltd."
108315(original LeaseNo. 2755)	Ewart	K25134	2429DKL	30-Nov-2029	18.3	21 year	42149-0069(LT)	Celynn Kathleen Roberta AlcockNote:there is an assignment of Leasehold Interest toCanadian Star Minerals Ltd. registered ontitle –LR'sOrder should be registered to reflect new owner as"CanadianStar Minerals Ltd."
108318(original LeaseNo. 2728)	Ewart	K28661	2421DKL	30-Sep-2029	18.2	21 year	42149-0064(LT)	Canadian Star Minerals Ltd.
108322(original LeaseNo. 2729)	Ewart	K28663	2422DKL	30-Sep-2029	24.7	21 year	42149-0047(LT)	Canadian Star Minerals Ltd.
108317(originalLease No.2727)	Ewart	K32306	2420DKL	30-Sep-2029	20.3	21 year	42149-0055(LT)	Canadian Star Minerals Ltd.
108324(original LeaseNo. 2730)	Ewart	K32307	2423DKL	30-Sep-2029	16.1	21 year	42149-0059(LT)	Canadian Star Minerals Ltd.
108319(original LeaseNo. 2726)	Ewart	K32574	2419DKL	30-Sep-2029	12.2	21 year	42149-0056(LT)	Canadian Star Minerals Ltd.
	Total	20 Leases			340.7

Map of High Lake Property:

West Hawk Lake, Manitoba, Canada

LeaseNumber	Township	Parcel #	LeaseExpiryDate	Hectares	Lease Term	PIN	Title Holder
ML-018	WestHawkLake(FalconLakeDistrict)	Lots 152 to 158 and Lots 217 to 232 in Group74, which lots are shown on Director ofSurveys Plans 3566 to 3572, 4843, 4851,4855, 4845, 4841, 4842, 4846, 4853, 4852,4849, 4848, 4850, 4854, 4844, 4847 and4846.	April 1,2034	318.68	21 yearscommencingApril 1,2034		Canadian StarMinerals Ltd.

Map of West Hawk Lake Property

commissions, royalties, licence fees or similar payments

-$10,000 annual payment due to International Millennium Mining Corp. on June 15 of each year until commercial production begins.

Section 3.20: McFarlane material contracts

-Definitive Property Purchase Agreement

-North Consulting Agreement

-CSM Right of First Refusal Agreement

-Business Combination Agreement

-Agency Agreement

-Transition Metals Option Agreement

-Michaud Option Agreement

-Warrant Indenture

Section 3.27(b): employment agreements and contracts for services

-none

Section 3.27(c): Employee Plans

-none

SCHEDULE C 128 DISCLOSURE SCHEDULE

Section 4.16: Contracts

• the Service Agreement with TSX Trust Company dated March 22, 2021, providing for the appointment of TSX Trust Company as the registrar and transfer agent for the 128 Shares; and
• the Business Combination Agreement.