CKR CARBON CORPORATION PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT (FLOW-THROUGH SHARES) INSTRUCTIONS TO SUBSCRIBER

Transcription

1 CKR CARBON CORPORATION PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT (FLOW-THROUGH SHARES) INSTRUCTIONS TO SUBSCRIBER Please read the entirety of the Subscription Agreement carefully. Please make sure that you include with your subscription: 1. You must complete all the information in the boxes on page 2 and sign where indicated. Accredited Investors (Canada) 2. If you are an "Accredited Investor" (as such term is defined under National Instrument Prospectus Exemptions ("NI ")), please complete and execute Schedule I - Certificate of Accredited Investors attached to this Subscription Agreement, including Appendix A thereto. 3. If you are purchasing under paragraphs (d), (f) or (g) set out in Appendix A to Schedule I, please complete and execute Appendix B to Schedule I. Family Members, Close Personal Friend and Close Business Associates 4. If you are a family member, close personal friend or close business associate of a director, executive officer, control person or founder of the Corporation or an affiliate of the Corporation (or a spouse of such person), please complete and execute: Schedule II attached to this Subscription Agreement; if you are resident in Saskatchewan, the risk acknowledgement form attached as Schedule III to this Subscription Agreement; if you are resident in Ontario, the risk acknowledgement form attached as Schedule IV to this Subscription Agreement. METHOD OF PAYMENT Provide payment in an amount equal to the Aggregate Subscription Price in Canadian dollars by delivering a certified cheque, money order or bank draft made payable to "Garfinkle Biderman LLP, in trust", or by wire to Garfinkle Biderman LLP at: Bank: TD Canada Trust Rexdale Commercial Banking Centre 2038 Kipling Avenue Etobicoke, Ontario, Canada, M9W 4K1 Institution #: 0004 Branch Transit #: Beneficiary Account #: Beneficiary s Account Name: Garfinkle Biderman LLP, in Trust File Reference #: Please return your completed Subscription Agreement together with the applicable exhibits to Anthony Durkacz and Song Lee of First Republic Capital Corporation at anthony@firstrepubliccapital.com and song@firstrepubliccapital.com along with your payment no later than 4:00 p.m. (Toronto time) on March 23, Full disclosure: The principals and employees of First Republic Capital Corporation own shares and warrants to purchase shares of CKR Carbon Corporation, which were purchased in a previous financing.

2 - 2 - SUBSCRIPTION AGREEMENT TO: AND TO: CKR CARBON CORPORATION (the Corporation ) FIRST REPUBLIC CAPITAL CORPORATION (the "Agent") The undersigned (the Subscriber ) hereby irrevocably subscribes for and agrees to purchase the number of flowthrough common shares of the Corporation (individually, a Flow-Through Share and collectively, the Flow-Through Shares ) set forth below for the aggregate subscription amount set forth below (the Aggregate Subscription Amount ), representing a subscription price of $0.10 per Flow-Through Share, upon and subject to the terms and conditions set forth in TERMS AND CONDITIONS OF SUBSCRIPTION attached hereto (together with the first two pages and the attached Schedules, the Subscription Agreement ). The Corporation and the Subscriber agree that the Flow-Through Shares will be flow through shares as defined in subsection 66(15) of the Income Tax Act (Canada) (the Tax Act ). The Corporation and the Subscriber agree that the subscription price of $0.10 per Flow-Through Share (in the aggregate, the Commitment Amount ) will be spent by the Corporation so that it incurs Canadian Exploration Expenses (as defined herein). The Corporation will incur Canadian Exploration Expenses in an amount equal to the Commitment Amount from the Closing (as defined herein) until December 31, 2018 (the Termination Date ) and renounce such Canadian Exploration Expenses with an effective date no later than December 31, The Flow-Through Shares are also referred to herein as the Securities. The Subscriber acknowledges that the Corporation and the Agent, and their respective counsel, are relying upon the representations, warranties and covenants of the Subscriber set forth in this Subscription Agreement. Number of Flow-Through Shares: (Name of Subscriber please print) By: (Authorized Signature) Aggregate Subscription Amount: (Official Capacity or Title - please print) (Please print name of individual whose signature appears above if different than the name of the Subscriber printed above.) (SIN, or other Tax Identification Number of the Subscriber) If the Subscriber is signing as agent for a principal and is not deemed to be acting as principal pursuant to National Instrument , complete the following and, if applicable, ensure that the applicable Schedules are completed on behalf of such principal: (Name of Principal) (Subscriber s Address) (Principal s Address) ( Address) (Telephone Number) ( Address) (Social Insurance Number or other Tax Identification Number) REGISTER the Flow Through Shares as set forth below: DELIVER the Flow Through Shares as set forth below: (Name) (Name) (Account reference, if applicable) (Account reference, if applicable) (Address) (Contact Name) (Address)

3 - 3 - ACCEPTANCE: The Corporation hereby accepts the subscription as set forth above on the terms and conditions contained in this Subscription Agreement this day of, CKR CARBON CORPORATION By: Name: Title:

4 INFORMATION REGARDING THE SUBSCRIBER Please check the appropriate box (and complete the required information, if applicable) in each section: 1. Security Holdings. Prior to giving effect to the Securities being subscribed for under this Subscription Agreement, the Subscriber and all persons acting jointly and in concert with the Subscriber currently own, directly or indirectly, or exercise control or direction over (provide additional detail as applicable): common shares of the Corporation and/or the following other kinds of shares and convertible securities (including but not limited to convertible debt, warrants and options) entitling the Subscriber to acquire additional common shares or other kinds of shares of the Corporation: No shares of the Corporation or securities convertible into shares of the Corporation. 2. Insider Status. The Subscriber either: is an Insider of the Corporation as defined in the Securities Act (Ontario) by virtue of being: (a) (c) (d) a director or executive officer of the Corporation; a director or executive officer of a company that is an Insider or subsidiary of the Corporation; a person that beneficially owns or controls, directly or indirectly, voting shares of the Corporation carrying more than 10% of the voting rights attached to all the Corporation s outstanding voting shares; or the Corporation itself if it holds any of its own securities. Is not an Insider of the Corporation. 3. Pro Group Status. The Subscriber either: is a Member of the Pro Group, which is defined in the Rules of the TSX Venture Exchange (the "Exchange") as either individually or as a group: (a) (c) (d) (e) (f) the member (i.e. a member of the Exchange under the Exchange requirements); employees of the member; partners, officers and directors of the member; affiliates of the member; such other persons as the Exchange may determine; and associates of any parties referred to in paragraphs (a) through (e) above. is not a member of the Pro Group.

5 TERMS AND CONDITIONS OF SUBSCRIPTION Definitions. 1. In this Agreement, the following terms shall have the meanings set out below and any reference in this Subscription Agreement to the Income Tax Act (Canada) or the Income Tax Regulations (Canada) (the Tax Regulations ) shall be deemed to include any specific proposals to amend the Income Tax Act (Canada) or the Income Tax Regulations (Canada) publicly announced by or on behalf of the Minister of Finance (Canada) prior to the date hereof, although there is no certainty that such proposals will be enacted in the form proposed, if at all: (a) Canadian Exploration Expense or CEE means an expense incurred in 2017 or 2018 as described in paragraph (f) of the definition of Canadian exploration expense in subsection 66.1(6) of the Tax Act other than amounts which are prescribed to be Canadian exploration and development overhead expense for purposes of paragraph 66(12.6) of the Tax Act, Canadian exploration expenses to the extent of the amount of any assistance described in paragraph 66(12.6)(a) of the Tax Act, the cost of acquiring or obtaining the use of seismic data described in paragraph 66(12.6)(b.1) of the Tax Act or any expenses for prepaid services or rent that do not qualify as outlays and expenses for the period as described in the definition of expense in subsection 66(15) of the Tax Act and any expenses deemed by subsection 66.1(9) of the Tax Act to be Canadian Exploration Expense. (c) CEE Incurred in Québec Eligible for an Additional Deduction means an expense described in sections , and of the Taxation Act (Québec). Flow-Through Mining Expenditure means a flow-through mining expenditure as defined in subsection 127(9) of the Tax Act. (d) Prescribed Forms means the forms prescribed from time to time under subsection 66(12.7) of the Tax Act and under the Taxation Act (Québec) filed or to be filed by the Corporation within the prescribed times renouncing to the Subscriber the Resource Expenses incurred pursuant to this Agreement and all parts or copies of such forms required by Canada Revenue Agency or under the Taxation Act (Québec) to be delivered to the Subscriber. (e) (f) (g) Prescribed Relationship means a relationship between the Corporation and the Subscriber where the Subscriber and the Corporation are related or otherwise do not deal at arm s length for the purposes of the Tax Act. Resource Expense means an expense which is CEE and a Flow-Through Mining Expenditure and which qualifies as CEE Incurred in Québec Eligible for an Additional Deduction and Surface Mining CEE Incurred in Québec Eligible for an Additional Deduction, which is incurred on or after the Closing (as defined below) and on or before the Termination Date which may be renounced by the Corporation pursuant to subsection 66(12.6) and/or 66(12.66) of the Tax Act with an effective date not later than December 31, 2017 and in respect of which, but for the renunciation, the Corporation would be entitled to a deduction from income for income tax purposes. Surface Mining CEE Incurred in Québec Eligible for an Additional Deduction means an expense described in sections , and of the Taxation Act (Québec).

6 - 2 - Terms of the Offering 2. The Subscriber acknowledges (on its own behalf and, if applicable, on behalf of each person on whose behalf the Subscriber is contracting) that this subscription is subject to rejection by the Corporation in whole or in part. The parties agree that this subscription and all money tendered by the Subscriber will be returned to the Subscriber, without interest or deduction, if this subscription is not accepted by the Corporation. 3. The Subscriber acknowledges (on its own behalf and, if applicable, on behalf of each person on whose behalf the Subscriber is contracting) that the offering (the "Offering"), of which this Subscription Agreement forms a part, is not subject to a minimum subscription and as such, upon acceptance of this Subscription Agreement by the Corporation and issuance of the Flow-Through Shares, the subscription funds received by the Corporation are immediately available for use by the Corporation. The Subscriber acknowledges that the Flow-Through Shares form part of a larger offering of up to 2,250,000 Flow-Through Shares of the Corporation and up to 13,333,334 units of the Corporation, on a private-placement basis. 4. The Subscriber acknowledges that the Corporation and the Agent have entered into, or will enter into on or prior to the Closing Date, an agency agreement (the "Agency Agreement") whereby the Agent, in connection with the Offering, will be entitled to receive on Closing from the Corporation a corporate finance fee equal to two percent (2%) of the gross proceeds of the Offering and a sale commission equal to eight percent (8%) of the gross proceeds of the Offering (the "Agent's Fee"). As additional consideration for the services of the Agent, the Corporation agrees to grant to the Agent such number of corporate finance warrants as is equal to two percent (2%) of the total number of Flow-Through Shares sold pursuant to the Offering and selling compensation warrants (collectively with the corporate finance warrants, the "Compensation Warrants") as is equal to eight percent (8%) of the total number of Flow- Through Shares sold under the Offering, at an exercise price of $0.10 per Compensation Warrant (as defined in the Agency Agreement), for a term of twenty four (24) months following the date of closing of the Offering. Other than the brokers or finders retained by the Corporation, the Subscriber warrants and represents that there are no other persons acting or purporting to act in connection with the transactions contemplated herein who is entitled to any brokerage or finder's fee and if any such person establishes a claim that any fee or other compensation is payable in connection with this subscription for Flow-Through Shares, the Subscriber covenants to indemnify and hold harmless the Corporation with respect thereto and with respect to all costs reasonably incurred in the defence thereof. 5. References in this Subscription Agreement (including attachments) to $ are to Canadian dollars. Acknowledgements, Representations, Warranties and Covenants of the Subscriber 6. The Subscriber acknowledges (on its own behalf and, if applicable, on behalf of each person on whose behalf the Subscriber is contracting) that the Offering will not in any way restrict the Corporation from issuing additional securities of the Corporation at prices, on terms and in amounts as may be determined by the Corporation, in its sole and absolute discretion. The Subscriber further acknowledges that the Corporation may complete additional financings in the future which may have a dilutive effect on existing shareholders at such time, including the Subscriber. 7. The Subscriber (on its own behalf and, if applicable, on behalf of each person on whose behalf the Subscriber is contracting) represents, warrants, covenants, acknowledges and declares to the Corporation and the Agent, and to their respective counsel (and acknowledges that the Corporation and the Agent, and their respective counsel are relying thereon) that: (a) if an individual, it is of the full age of majority and is legally competent to execute this Subscription Agreement and take all action pursuant hereto;

7 - 3 - (c) (d) (e) (f) (g) (h) (i) (j) if a corporation, partnership, unincorporated association or other entity, it has the legal capacity to enter into and be bound by this Subscription Agreement and further certifies that all necessary approvals of directors, shareholders, partners or otherwise have been given and obtained; this Subscription Agreement has been duly and validly authorized, executed and delivered by and constitutes a legal, valid, binding and enforceable obligation of the Subscriber enforceable in accordance with its terms; in the case of a subscription by it acting as agent for a disclosed principal, it is duly authorized to execute and deliver this Subscription Agreement and all other necessary documentation in connection with such subscription on behalf of such principal and this Subscription Agreement has been duly authorized, executed and delivered by or on behalf of, and constitutes a legal, valid and binding agreement of, such principal enforceable in accordance with its terms; the entering into of this Subscription Agreement and the transactions contemplated hereby will not result in a violation of any of the terms or provisions of any law applicable to the Subscriber, or if the Subscriber is not a natural person, any of the Subscriber s constating documents, or any agreement to which the Subscriber is a party or by which it is bound; it does not act jointly or in concert with any other subscriber under the Offering for the purposes of the acquisition contemplated hereunder; it has not received or been provided with, nor has it requested, nor does it have any need to receive, any prospectus or offering memorandum, or any other document (other than financial statements, interim financial statements or any other document, the content of which is prescribed by statute or regulation) describing the business and affairs of the Corporation which has been prepared for delivery to, and review by, prospective purchasers in order to assist it in making an investment decision in respect of the acquisition contemplated hereunder; it has not become aware of any advertisement in printed media of general and regular paid circulation (or other printed public media), radio, television or telecommunications or other form of advertisement (including electronic display) with respect to the distribution of the Flow-Through Shares; it has relied solely upon information publicly available on SEDAR relating to the Corporation (the "Information") and not upon any verbal or written representation as to fact or otherwise made by or on behalf of the Corporation or the Agent and it does not have knowledge of any material fact about the Corporation that has not been publicly disclosed; unless it is purchasing under subparagraph 7(k), (l) or (m), it is purchasing the Flow- Through Shares as principal for its own account, it is purchasing such Flow-Through Shares for investment only and not for the benefit of any other person and not with a view to the resale or distribution of all or any of the Flow-Through Shares, it is resident in the jurisdiction set out as the Subscriber s Address on the face page hereof and it fully complies with one or more of the criteria set forth below: (i) it is resident in a jurisdiction of Canada and it is an accredited investor, as such term is defined in National Instrument entitled Prospectus Exemptions ( NI ) or, if it is resident in Ontario, under the Securities Act (Ontario) (the "OSA"), other than a trust company or trust corporation registered under the laws of Prince Edward Island that is not registered or authorized under the Trust and Loan Companies Act (Canada) or under comparable legislation in another

8 - 4 - jurisdiction of Canada, and has concurrently executed and delivered: (A) a Certificate of Accredited Investor in the form attached as Schedule I to this Subscription Agreement; and (B) if required as described in Schedule I to this Subscription Agreement, a Risk Acknowledgement Form (Accredited Investor) attached as Appendix B to Schedule I; (ii) (iii) (iv) (v) it is resident in a jurisdiction of Canada and is qualified for the Family, Friends and Business Associates exemption under NI and has concurrently executed and delivered a Certificate of Family, Friends and Business Associates in the form attached as Schedule II to this Subscription Agreement, has initialled therein indicating that the Subscriber satisfies one of the categories of family, friends and business associates set forth in such exemption, and: (A) if resident in Saskatchewan, a risk acknowledgement form in the form attached as Schedule III to this Subscription Agreement; or (B) if resident in Ontario, it is not an investment fund, and it has completed a risk acknowledgment form in the form attached as Schedule IV to this Subscription Agreement; it is a director, executive officer or founder of the Corporation; it is not an individual, as such term is defined in the OSA, the aggregate acquisition cost of the Flow-Through Shares purchased by it is not less than $150,000 and it is not a company established or used solely to acquire the Flow- Through Shares; or if it is a resident of Canada but not purchasing under subparagraph 7(j)(i) through (iv) inclusive, it is purchasing pursuant to an exemption from prospectus and registration requirements (particulars of which are enclosed herewith) available to it under applicable securities legislation and shall deliver to the Corporation and the Agent such further particulars of the exemption(s) and the Subscriber s qualifications thereunder as the Corporation or the Agent may request; (k) (l) (m) if it is not purchasing as principal, it is duly authorized to enter into this Subscription Agreement and to execute all documentation in connection with the purchase on behalf of each beneficial purchaser, each of whom is purchasing as principal for its own account, not for the benefit of any other person, and not with a view to the resale or distribution of all or any of the Securities, it acknowledges that the Corporation and the Agent may be required by law to disclose to certain regulatory authorities, the identity of each beneficial purchaser of Flow-Through Shares for whom it may be acting, it and each beneficial purchaser is resident in the jurisdiction set out as the "Subscriber s Address"; if it is acting as agent for one or more disclosed principals, each of which principals is purchasing as a principal for its own account for investment only and not for the benefit of any other person and not with a view to the resale or distribution of all or any of the Securities and each of which principals complies with one or more of the criteria set forth in subparagraph 7(j); if it is not a resident of Canada, it is purchasing pursuant to an exemption from prospectus and registration requirements available to it under applicable securities legislation and shall deliver to the Corporation and the Agent such further particulars of the exemption(s), the Subscriber s qualifications thereunder and such evidence of compliance with all such matters as the Corporation or the Agent may request and the delivery of this Subscription Agreement, the acceptance hereof by the Corporation and the issuance of the Flow-Through Shares to the Subscriber complies with all applicable laws of the Subscriber's jurisdiction of residence and domicile and will not cause the Corporation or any of its officers or directors to become subject to or require any disclosure, prospectus or other reporting requirement;

9 - 5 - (n) it acknowledges that: (i) (ii) (iii) (iv) (v) no securities commission or similar regulatory authority has reviewed or passed on the merits of the Securities; there is no government or other insurance covering the Securities; there are risks associated with the purchase of the Securities; there are restrictions on the Subscriber s ability to resell the Securities and it is the responsibility of the Subscriber to find out what those restrictions are and to comply with them before selling any of the Securities; and the Corporation or its agent has advised the Subscriber that the Corporation is relying on an exemption from the requirements to provide the Subscriber with a prospectus and to sell the Securities through a person or company registered to sell securities under the Act and, as a consequence of acquiring the Securities pursuant to this exemption, certain protections, rights and remedies provided by the Act, including statutory rights of rescission or damages, will not be available to the Subscriber; (o) (p) it is aware that none of the Securities have been nor will be registered under the U.S. Securities Act and that these Securities may not be offered or sold in the United States without registration under the U.S. Securities Act or compliance with requirements of an exemption from registration; the Subscriber represents and warrants that: (i) (ii) (iii) (iv) (v) the Subscriber is not a "U.S. Person" (as defined in Regulation S, the definition of which includes, but is not limited to, a natural person resident in the United States and an estate or trust of which any executor or administrator or trustee, respectively, is a U.S. Person and any partnership or corporation organized or incorporated under the laws of the United States) and is not purchasing the Securities for the account or benefit of any U.S. Person or for offering, resale or delivery for the account or benefit of any U.S. Person or for the account or benefit of any person in any jurisdiction set out in the name and address of the Subscriber below; the Subscriber was outside the United States at the time of execution and delivery of this Subscription Agreement within the meaning of Regulation S; no offers to sell the Securities to the Subscriber were made by any person to the Subscriber while the Subscriber was in the United States; the Subscriber understands that the Corporation has no obligation or present intention of filing a registration statement under the U.S. Securities Act in respect of the Securities; the Subscriber will not engage in any directed selling efforts (as defined by Regulation S under the U.S. Securities Act) in the United States in respect of the Securities, which would include any activities undertaken for the purpose of, or that could reasonably be expected to have the effect of conditioning the market in the United States for the resale of the Securities; (q) it undertakes and agrees that it will not offer or sell any of the Securities in the United States unless such securities are registered under the U.S. Securities Act and the securities laws of all applicable states of the United States or an exemption from such

10 - 6 - registration requirements is available, and further that it will not resell any of the Securities in any jurisdiction, except in accordance with the provisions of applicable securities legislation, regulations, rules, policies and orders and stock exchange rules; (r) it acknowledges that no representation (written or oral) has been made to it by the Corporation or the Agent nor any of their respective directors, employees, officers or affiliates: (i) (ii) (iii) as to the future value or price of the Flow-Through Shares; that any person will resell or repurchase the Flow-Through Shares; or; that any person will refund the purchase price of the Flow-Through Shares; (s) (t) (u) (v) (w) (x) the Corporation may complete additional financings in the future in order to develop the business of the Corporation and to fund its ongoing development; that there is no assurance that such financings will be available and, if available, on reasonable terms; any such future financings may have a dilutive effect on current security holders, including the Subscriber; and that if such future financings are not available, the Corporation may be unable to fund its ongoing development and the lack of capital resources may result in the failure of its business venture; it has such knowledge in financial and business affairs as to be capable of evaluating the merits and risks of its investment and it, or, where it is not purchasing as principal, each beneficial purchaser, is able to bear the economic risk of loss of its investment and the Subscriber is capable of assessing the proposed investment as a result of the Subscriber s financial experience or as a result of advice received from a registered person other than the Corporation or the Agent or any affiliates hereof; it understands that the Flow-Through Shares are being offered for sale only on a private placement basis and that the sale and delivery of the Flow-Through Shares is conditional upon such sale being exempt from the requirements as to the filing of a prospectus or the preparation of an offering memorandum in prescribed form or upon the issuance of such orders, consents or approvals as may be required to permit such sale without the requirement of filing a prospectus or delivering an offering memorandum in prescribed form and that certain protections, rights and remedies provided by applicable securities legislation, in connection with the filing of a prospectus may not be available to the Subscriber; if required by applicable securities legislation, regulations, rules, policies or orders or by any securities commission, stock exchange or other regulatory authority, the Subscriber will execute, deliver, file and otherwise assist the Corporation in filing, such reports, undertakings and other documents with respect to the issue of the Flow-Through Shares as may be required, including, without limitation, in the case of a Subscriber who is not an individual, a duly completed Corporate Placee Registration Form in the form required by the TSX Venture Exchange (the "Exchange") and attached as Schedule V to this Subscription Agreement; it will not resell the Securities or any of them, except in accordance with the provisions of applicable securities legislation and stock exchange rules, if applicable, in the future; it has been independently advised as to the restrictions with respect to trading in the Securities imposed by applicable securities legislation, confirms that no representation has been made to it by or on behalf of the Corporation or the Agent with respect thereto, acknowledges that it is aware of the characteristics of the Securities, the risks relating to an investment therein and of the fact that it may not be able to resell the Securities except in accordance with limited exemptions under applicable securities legislation and

11 - 7 - regulatory policy until expiry of the applicable restriction period and compliance with the other requirements of applicable law, and it agrees that any certificates representing the Securities may bear such legends as are required under applicable securities law and/or the policies of the Exchange indicating that the resale of such securities is restricted; (y) (z) (aa) (bb) (cc) the Subscriber acknowledges that it has been encouraged to and should obtain independent legal, income tax and investment advice with respect to its hereunder and accordingly, has been independently advised as to the meanings of all terms contained herein relevant to the Subscriber for the purposes of giving representations, warranties and covenants under this Subscription Agreement; the information provided by the Subscriber under the heading INFORMATION REGARDING THE SUBSCRIBER is true and correct in all material respects and will be true and correct as of the Closing Time; it acknowledges that the Corporation's counsel and the Agent's counsel are acting as counsel to the Corporation and the Agent, respectively, and not as counsel to the Subscriber; Arm s Length. The Subscriber and the Corporation are dealing, and will at all times prior to the Termination Date deal, with each other at arm s length and the Purchaser does not and will not have, prior to the Termination Date, a Prescribed Relationship with the Corporation; and Not Prescribed Shares. Neither the Subscriber, nor any person for whom it is contracting hereunder, as the case may be, has or will knowingly enter into any agreement or arrangement which will cause the Flow-Through Shares to be or become prescribed shares for the purpose of the Tax Act. Representations, Warranties and Covenants of the Corporation 8. The Corporation hereby represents, warrants and covenants to the Subscriber and the Agent (and acknowledges that the Subscriber and the Agent is relying thereon) that: (a) (c) the Corporation is a duly incorporated and validly subsisting corporation under the laws of its jurisdiction of incorporation and has full corporate power and authority to execute and deliver this Subscription Agreement, to issue each of the Securities to the Subscriber and to perform each of its obligations as herein contemplated; this Subscription Agreement, when accepted by the Corporation, will constitute a binding obligation of the Corporation enforceable in accordance with its terms; the execution and delivery of, and the performance of the terms of this Subscription Agreement by the Corporation, including the issue of the Securities, does not and will not constitute a breach of or default under the constating documents of the Corporation or any law, regulation, order or ruling applicable to the Corporation or any agreement, contract or indenture to which the Corporation is a party or by which it is bound. 9. Canadian Exploration Expense. (a) Incurring and Renouncing of CEE: The Corporation hereby agrees to and shall incur Resource Expenses in an aggregate amount equal to the Commitment Amount on or before the Termination Date in accordance with this Agreement and shall renounce to the Subscriber, with an effective date no later than December 31, 2017, pursuant to either or both of subsection 66(12.6) of the Tax Act, and, in respect of Resource Expenses incurred by the Corporation in 2017 or in 2018, pursuant to subsections 66(12.66) and

12 - 8-66(12.6) of the Tax Act, Resource Expenses in an amount equal to the Commitment Amount. Additional Deductions: Notwithstanding any other provisions of this Agreement, the Corporation hereby agrees that the Commitment Amount will be incurred on CEE that qualifies as CEE Incurred in Québec Eligible for an Additional Deduction and Surface Mining CEE Incurred in Québec Eligible for an Additional Deduction. (c) Renunciation: The Corporation shall deliver to the Subscriber, on or before March 1, 2018, the relevant Prescribed Forms, fully completed and executed, renouncing to the Subscriber Resource Expenses in an amount equal to the Commitment Amount with an effective date of no later than December 31, 2017, such delivery constituting the authorization of the Corporation to the Subscriber to file such Prescribed Forms with the relevant taxation authorities. (d) (e) (f) (g) (h) Commitment Amount: The Corporation has no reason to believe that it will not be able to incur, on or after the Closing and on or before the Termination Date, or that it will be unable to renounce to the Subscriber effective on or before December 31, 2017, Resource Expenses in an aggregate amount equal to the Commitment Amount and it has no reason to expect any reduction of such amount by virtue of subsection 66(12.73) of the Tax Act. Filing: The Corporation shall file with Canada Revenue Agency within the time prescribed by subsection 66(12.68) of the Tax Act the prescribed forms together with a copy of this Agreement and any selling instrument contemplated by the Tax Act. Flow-Through Shares: The Flow-Through Shares will qualify as flow-through shares as defined in subsection 66(15) of the Tax Act and in particular will not be prescribed shares as defined in section of the Tax Regulations. Principal Business Corporation: The Corporation is and shall maintain its status as a principal business corporation as defined in subsection 66(15) of the Tax Act and as a development corporation as such term is defined in section 363 of the Taxation Act (Québec) until such time as all of the Resource Expenses required to be renounced under this Agreement have been incurred and validly renounced pursuant to the Tax Act and the Taxation Act (Québec). Resource Expenses: The Resource Expenses to be renounced by the Corporation to the Subscriber: (i) (ii) (iii) (iv) will constitute CEE on the effective date of the renunciation and will qualify as Flow-Through Mining Expenditures and CEE Incurred in Québec Eligible for an Additional Deduction and Surface Mining CEE Incurred in Québec Eligible for an Additional Deduction; will not include any amount that has previously been renounced by the Corporation to the Subscriber or to any other person; would be deductible by the Corporation in computing its income for the purposes of Part I of the Tax Act but for the renunciation to the Subscriber; and will not be subject to any reduction under subsection 66(12.73) of the Tax Act. (i) Reduction in Resource Expense: The Corporation shall not reduce the amount renounced to the Subscriber pursuant to subsection 66(12.6) or 66(12.66) of the Tax Act.

13 - 9 - (j) (k) Valid Renunciation: The Corporation shall not be subject to the provisions of subsection 66(12.67) of the Tax Act in a manner which impairs its ability to renounce Resource Expenses to the Subscriber in an amount equal to the Commitment Amount. Applications for Prescribed Grants: If the Corporation receives, or becomes entitled to receive, any government assistance which is described in paragraph (a) of the definition of excluded obligation in subsection (5) of the Tax Regulations and the receipt or entitlement to receive such government assistance has or will have the effect of reducing the amount of CEE validly renounced to the Subscriber hereunder to less than the Commitment Amount, the Corporation shall incur additional CEE so that it renounce Resources Expenses in an amount no less that the Commitment Amount to the Subscriber. 10. Taxation Act (Québec). In this Agreement, any reference to: (a) (c) a word or term defined under the Tax Act includes, for purposes of Québec income taxation, a reference to the equivalent term, if any, defined under the Taxation Act (Québec) as such Act may be amended, re-enacted or replaced from time to time; the Tax Act or a provision thereof includes, for purposes of Québec income taxation, a reference to the Taxation Act (Québec) or the equivalent provision thereof as such Act may be amended, re-enacted or replaced from time to time; or a filing or similar requirement imposed under the Tax Act includes, for purposes of Québec income taxation, a reference to the equivalent filing or similar requirement, where applicable, under the Taxation Act (Québec) as such Act may be amended, re-enacted or replaced from time to time; provided that, if no filing or similar requirement is provided under the Taxation Act (Québec), a copy of any material filed under the Tax Act shall be filed with Revenu Québec. Closing 11. The Subscriber agrees to deliver to the Agent, not later than 5:00 p.m. (Toronto time) on the day that is two business days before the Closing Date: (a) this duly completed and executed Subscription Agreement, including all applicable Schedules hereto and Appendices thereto; and a wire, transfer, certified cheque or bank draft payable to "Garfinkle Biderman LLP, in trust", or to the account of Garfinkle Biderman LLP for the Aggregate Subscription Amount, unless the Agent agrees that the Aggregate Subscription Amount may be delivered on the Closing Date against delivery of the certificates representing the Flow- Through Shares. 12. The sale of the Flow-Through Shares pursuant to this Subscription Agreement will be completed (the "Closing") at the office of Garfinkle Biderman LLP, counsel to the Agent, at 1 Adelaide Street East, Suite 801, Toronto, Ontario, M5C 2V9 on or before March 27, 2017 or such other date (the Closing Date ) and at such time (the Closing Time ) as the Corporation and the Agent may agree. The Subscriber acknowledges that the certificates representing the Flow-Through Shares subscribed for hereunder will be available for delivery at the Closing provided that the Subscriber has satisfied the requirements of Section 9 hereof and the Corporation has accepted this Subscription Agreement. The Subscriber hereby authorizes the delivery of such certificates by the transfer agent of the Corporation to the Agent or its solicitor. 13. The Corporation and the Agent shall be entitled to rely on delivery of a PDF or facsimile copy of executed subscriptions, and acceptance by the Corporation of such PDF or facsimile subscriptions shall be legally effective to create a valid and binding agreement between the

14 Subscriber and the Corporation in accordance with the terms hereof. The Subscriber acknowledges and agrees that if less than a complete copy of this Subscription Agreement is delivered to the Agent at closing, the Subscriber will be deemed to have agreed to all terms and conditions of the pages not delivered at closing unaltered. 14. The Subscriber acknowledges and agrees that such documents, when executed and delivered by the Subscriber, will form part of and will be incorporated into this Subscription Agreement with the same effect as if each constituted a representation, warranty or covenant of the Subscriber hereunder in favour of the Corporation and the Agent. The Subscriber acknowledges and agrees that this offer, the Aggregate Subscription Price and any other documents delivered in connection herewith will be held by the Agent until such time as the conditions set out in the Agency Agreement are satisfied by the Corporation or waived by the Agent. Agency Agreement 15. The Subscriber acknowledges that the Flow-Through Shares are offered on a "private placement" basis and, in connection therewith, the Corporation and the Agent have entered into, or will enter into prior to the Closing Date, the Agency Agreement pursuant to which the Agent, in connection with the issue and sale of the Flow-Through Shares, will receive the Agent's Fee from the Corporation and the Compensation Warrants. The Subscriber hereby irrevocably authorizes the Agent, in their sole discretion: (i) (ii) (iii) (iv) to negotiate and settle the form of any certificates to be delivered and any agreement to be entered into in connection with the Offering including the Subscription Agreement, and to vary, amend, alter or waive, on its own behalf and on behalf of the purchasers of Flow-Through Shares, in whole or in part, or extend the time for compliance with, any of the conditions for completing the sale of the Flow-Through Shares in such manner and on such terms and conditions as the Agent may determine, acting reasonably, without in any way affecting the Subscriber's obligations or the obligations of such others hereunder; provided, however, that the Agent shall not vary, amend, alter or waive any such condition where to do so would, in the opinion of the Agent, result in a material adverse change to any of the material attributes of the Flow-Through Shares; to allocate the Flow-Through Shares being offered pursuant to the Offering and in accordance with the terms of the Agency Agreement; to act as its representative at the closing of the Offering with full power of substitution, as its true and lawful attorneys and agents with the full power and authority in its place and stead to swear, execute, file and record any document necessary, to approve any opinions, certificates or other documents addressed to the Subscriber, to accept delivery of any certificates representing the Flow- Through Shares on the Closing Date, to terminate this subscription on its behalf in the event that any condition precedent to the Offering has not been satisfied and to execute a receipt for any such certificates and all other documentation; and to complete or correct any errors or omissions in any form or document provided by the Subscriber, including this Subscription Agreement. 16. The Subscriber agrees that this power of attorney is irrevocable, is coupled with an interest and has been given for valuable consideration, the receipt and adequacy of which are acknowledged. This power of attorney and other rights and privileges granted under this section will survive any legal or mental incapacity, dissolution, bankruptcy or death of the Subscriber. This power of attorney extends to the heirs, executors, administrators, other legal representatives and successors, transferees and assigns of the Subscriber. Any person dealing with the Agent may conclusively presume and rely upon the fact that any document, instrument or agreement

15 executed by an Agent pursuant to this power of attorney is authorized and binding on the Subscriber, without further inquiry. The Subscriber agrees to be bound by any representations or actions made or taken by the Agent pursuant to this power of attorney, and waives any and all defences that may be available to contest, negate or disaffirm any action of the Agent taken in good faith under this power of attorney. Use of Personal Information 17. The Subscriber acknowledges and consents to the fact that the Corporation is collecting the Subscriber s (and any beneficial purchaser for which the Subscriber is contracting hereunder) personal information (as that term is defined under applicable privacy legislation, including, without limitation, the Personal Information Protection and Electronic Documents Act and any other applicable similar replacement or supplemental provincial or federal legislation or laws in effect from time to time) for the purpose of completing the Subscriber s subscription. The Subscriber acknowledges and consents to the Corporation retaining the personal information for so long as permitted or required by applicable law or business practices. The Subscriber further acknowledges and consents to the fact that the Corporation may be required by applicable securities laws, stock exchange rules and/or Investment Dealers Association of Canada rules to provide regulatory authorities any personal information provided by the Subscriber respecting itself (and any beneficial purchaser for which the Subscriber is contracting hereunder). The Subscriber represents and warrants that it has the authority to provide the consents and acknowledgements set out in this paragraph on behalf of all beneficial purchasers for which the Subscriber is contracting. 18. In addition, the Subscriber agrees and acknowledges that: (a) (c) (d) (e) (f) (g) the Corporation will deliver certain personal information, including information regarding the name, address, telephone number, address and amount subscribed for, to the securities regulatory authorities, including the Ontario Securities Commission (the "OSC") and the Exchange; the information is being collected indirectly by the securities regulatory authorities under authority granted to them in securities legislation; the information is being collected for the purposes of the administration and enforcement of such securities legislation; the Subscriber may contact the Administrative Assistant to the Director of Corporate Finance at the British Columbia Securities Commission (the BCSC ) at the 12 th Floor, 701 West Georgia Street, Box 10142, Vancouver, British Columbia, V7Y 1L2 ( ) for information regarding the collection and use of this personal information by the BCSC; the Subscriber may contact the Administrative Assistant to the Director of Corporate Finance at the OSC at Suite 1903, Box 5520, Queen Street West, Toronto, Ontario, M5H 3S8 ( ) for information regarding the collection and use of this personal information by the Ontario Securities Commission; the Subscriber hereby authorizes the indirect collection of the information by the OSC and the BCSC; and the Exchange collects personal information in forms submitted by the Corporation, which will include personal information regarding the Subscriber and may use this information in the manner provided for in Appendix 6A to the TSX Venture Exchange Corporate Finance Policy Manual, a copy of which is reproduced as Schedule VI to this Subscription Agreement.

16 General 19. The Subscriber agrees that the representations, warranties and covenants of the Subscriber herein will be true and correct both as of the execution of this Subscription Agreement and as of the Closing Time and will survive the completion of the issuance of the Flow-Through Shares, and in the case of sections 7(z), 7(bb) and 7(cc), until the Termination Date. The representations, warranties and covenants of the Subscriber herein are made with the intent that they be relied upon by the Corporation and the Agent in determining the eligibility of a purchaser of Flow- Through Shares and the Subscriber agrees to indemnify the Corporation and the Agent against all losses, claims, costs, expenses and damages or liabilities which they may suffer or incur which are caused or arise from an inaccuracy or breach thereof and reliance thereon. The Subscriber acknowledges and agrees that all costs incurred by the Subscriber (including any fees and disbursements of any special counsel retained by the Subscriber) relating to the sale contemplated hereunder shall be borne by the Subscriber. 20. The terms and provisions of this Subscription Agreement shall be binding upon and enure to the benefit of the Subscriber and the Corporation and their respective heirs, executors, administrators, successors and assigns; provided that, except for the assignment by a Subscriber who is acting as nominee or agent to the beneficial owner and as otherwise herein provided, this Subscription Agreement shall not be assignable by any party without prior written consent of the other party or parties. 21. The contract arising out of this Subscription Agreement and all documents relating thereto shall be governed by and construed in accordance with the laws of the Province of British Columbia and the federal laws of Canada applicable therein. The parties irrevocably attorn to the exclusive jurisdiction of the courts of the Province of British Columbia. 22. Time shall be of the essence hereof. 23. This Subscription Agreement represents the entire agreement of the parties hereto relating to the subject matter hereof and there are no representations, covenants or other agreements relating to the subject matter hereof except as stated or referred to herein. Neither this Subscription Agreement nor any provision hereof shall be modified, changed, discharged or terminated except by an instrument in writing signed by the party against whom any waiver, change, discharge or termination is sought.

17 SCHEDULE I CERTIFICATE OF ACCREDITED INVESTORS (For residents of Canada) TO: AND TO: CKR CARBON CORPORATION (the "Corporation") FIRST REPUBLIC CAPITAL CORPORATION (the "Agent") In connection with the purchase of flow-through common shares in the capital of the Corporation ( Flow-Through Shares ) by the undersigned subscriber or, if applicable, the principal on whose behalf the undersigned is purchasing as agent (the Subscriber for the purposes of this Schedule I), the Subscriber hereby represents, warrants, covenants and certifies to the Corporation and the Agent that: 1. The Subscriber is purchasing the Flow-Through Shares as principal for its own account or is deemed to be acting as principal pursuant to National Instrument Prospectus Exemptions ( NI ); 2. The Subscriber is an accredited investor within: (A) for subscribers resident in Canada other than residents of Ontario, the meaning of NI , or (B) for subscribers resident in Ontario, the meaning under the Securities Act (Ontario) (the "OSA") by virtue of satisfying the indicated criterion as set out in Appendix A to this Schedule I; 3. If the Subscriber is an "accredited investor" under the criterion described in (d), (f) or (g) set out in Appendix A to this Schedule I, the Subscriber has also completed and executed two original copies of the risk acknowledgement form attached as Appendix B to this Schedule I; and 4. Upon execution of this Schedule I by the Subscriber, the initialling of the applicable category set forth in Appendix A hereto, and, if applicable, the completion and execution of the risk acknowledgement form set forth in Appendix B to this Schedule I, Schedule I and its appendices shall be incorporated into and form a part of the Subscription Agreement. Dated:, Print name of Subscriber By: Signature Print name of Signatory (if different from Subscriber) IMPORTANT: (1) PLEASE INITIAL OR PLACE A CHECK MARK BESIDE THE APPLICABLE CATEGORY IN APPENDIX A ATTACHED HERETO. (2) IF YOU HAVE INITIALLED CRITERION (D), (F) OR (G) IN APPENDIX A ATTACHED HERETO, COMPLETE AND EXECUTE TWO ORIGINALS OF THE RISK ACKNOWLEDGMENT FORM ATTACHED AS APPENDIX B ATTACHED HERETO. Title