In addition to the usual matters to be presented at the AGM, including the appointment of auditors and election of directors, SHAREHOLDERS WILL BE ASKED TO CONSIDER AN ORDINARY RESOLUTION TO APPROVE THE STOCK OPTION PLAN (THE "SOP") AS AMENDED FOR 2014, AN ORDINARY RESOLUTION TO APPROVE AMENDMENTS TO BY-LAW NO. 1 (THE "BY-LAW AMENDMENT"), A SPECIAL RESOLUTION AUTHORIZING, SUBJECT TO REGULATORY APPROVAL, THE CONSOLIDATION OF THE COMPANY SHARES ON THE BASIS OF ONE NEW SHARE FOR A MAXIMUM OF EVERY FIVE PRE-CONSOLIDATION SHARES (THE "CONSOLIDATION"), AND AN ORDINARY RESOLUTION TO APPROVE A SHAREHOLDERS' RIGHTS PLAN (THE "SRP").

The SOP was amended to bring it in line with the current TSXV Policies, to increase the number of shares reserved (the "Fixed Number") under the SOP to 31,925,000 and to change the form of Option Agreement. The new Fixed Number represents about 20% of the current issued and outstanding shares of the Company and a net increase of 5,450,000 from the 2013 SOP. An aggregate of 481,250 shares were issued pursuant to option exercises under the SOP since the last AGM held on June 21, 2013.

THE PURPOSE OF THE BY-LAW AMENDMENT IS TO INCORPORATE CHANGES REQUIRED TO ALLOW THE COMPANY TO UTILIZE THE DIRECT REGISTRATION SYSTEM (DRS) FOR THE ISSUANCE OF SHARES OF THE COMPANY. THE POTENTIAL BENEFITS AND RISKS OF THE CONSOLIDATION ARE SET OUT IN THE INFORMATION CIRCULAR. THE SRP is designed to ensure fair treatment for all shareholders in the event of a take-over bid and to provide shareholders and the Directors with adequate time to evaluate any bid for the Company and the opportunity to maximize shareholder value in the event of any such bid. The details of the SRP are summarized in the Information Circular.

The Directors have approved these proposed changes as they believe they are in the best interests of the shareholders.

DIRECT REGISTRATION SYSTEM (DRS) OFFERS SIMPLICITY AND EFFICIENCY TO BOTH YOUR SECURITYHOLDERS AND YOUR ORGANIZATION. IT IS A SYSTEM THAT ALLOWS SECURITIES IN TO BE HELD IN "BOOK-ENTRY" FORM WITHOUT HAVING A PHYSICAL SECURITY CERTIFICATE ISSUED AS EVIDENCE OF OWNERSHIP. INSTEAD, REGISTERED SECURITIES ARE HELD AND REGISTERED ELECTRONICALLY IN OUR RECORDKEEPING SYSTEM.

Computershare at the forefront of DRS in Canada

Securityholder benefits

• It eliminates the need for securityholders to safeguard and store certificates.
• It avoids the significant cost of a surety bond for the replacement of and effort involved in replacing physical certificate(s) that might be lost, stolen or destroyed.
• It permits/enables electronic security transactions between your broker or dealer and Computershare as transfer agent.
• It provides a full audit trail of all DRS transactions.