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THIS CONVERTIBLE LOAN AGREEMENT is made as of the day

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THIS CONVERTIBLE LOAN AGREEMENT is made as of the day Powered By Docstoc
					                               This is a redacted version of an Agreement




         THIS CONVERTIBLE LOAN AGREEMENT is made as of the 18 day of August, 2010.

BETWEEN:

                                   BELVEDERE RESOURCES LTD.
                                            as borrower
                                         (the “Borrower”)

                                                   - and -

                                          INVESTEC BANK plc
                                                as lender
                                             (the “Lender”)

        WHEREAS, the Borrower has requested a credit facility from the Lender and the Lender has
agreed to provide it to the Borrower on the following terms.

        NOW THEREFORE, in consideration of the premises and the mutual covenants herein
contained, the parties to this Agreement hereby agree as follows:

                                              ARTICLE I
                                            DEFINED TERMS

1.1      Defined Terms

         In this Agreement:

         “Agreement”, “hereof”, “herein”, “hereto”, “hereunder” or similar expressions mean this
         Agreement, as amended, supplemented, restated and replaced from time to time.

         “Applicable Laws” means, in relation to any Person, transaction or event:

         (a)     all applicable rules of common law and equity, and all applicable provisions of laws,
                 statutes, rules, policies and regulations of any Governmental Authority in effect from
                 time to time having force of law; and

         (b)     all judgments, orders, awards, decrees, official directives, writs and injunctions all having
                 force of law from time to time in effect of any Governmental Authority in an action,
                 proceeding or matter in which the Person is a party or by which it or its property is bound
                 or having application to the transaction or event

         “Applicable Margin” means [Redacted].

         “Belvedere Finland” means Belvedere Mining Oy, a corporation incorporated under the laws of
         Finland and its successors and permitted assigns.



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                                                     -2-


         “Belvedere BV” means Belvedere Resources BV, a corporation incorporated under the laws of
         the Netherlands and its successors and permitted assigns.

         “Belvedere Fin Gold” means Belvedere Resources Finland Oy, a corporation incorporated under
         the laws of the Finland and its successors and permitted assigns.

         “Belvedere UK” means Belvedere Resources (UK) Ltd., a corporation incorporated under the
         laws of the United Kingdom and its successors and permitted assigns.

         “Borrower” means Belvedere Resources Ltd., a corporation incorporated under the laws of the
         Province of British Columbia, and its successors and permitted assigns.

         “Break Costs” means the amount (if any) by which:

         (a)       the interest which the Lender should have received for the period from the date of receipt
                   of an Advance to the last day of the current Interest Period in respect of such Advance,
                   had the principal amount received been paid on the last day of that Interest Period,

         exceeds

         (b)       the amount which the Lender would be able to obtain by placing an amount equal to the
                   principal amount received by it on deposit with a leading bank as determined by the
                   Lender in the interbank Eurodollar market for a period starting on the Business Day
                   following receipt or recovery and ending on the last day of the current Interest Period.

         “Business Day” means (i) for all purposes other than as covered by clause (ii) below, a day of the
         year, other than Saturday or Sunday, or other day on which banks are required or authorized to
         close in Vancouver, New York or London and (ii) with respect to all notices and determinations
         in connection with, and payments of principal and interest on the Loan, a day on which the Trans-
         European Automated Real-Time Gross Settlement Express Transfer (TARGET) System is open.

         “Capital Lease” means any lease, license or similar transaction determined as a capital lease in
         accordance with GAAP, or any sale and lease back transaction or any other lease (whether a
         synthetic lease or otherwise) other than any lease that would in accordance with GAAP be
         determined to be an operating lease.

         “Change In Control” means (i) the acquisition of control or ownership, directly or indirectly,
         beneficially or of record, by any Persons or group of Persons (other than the Lender or any of its
         affiliates or associates) acting jointly or otherwise in concert, of any and all shares, interest,
         participations, rights in, or other equivalent in the capital of the Borrower (the “Equity
         Securities”) representing more than 40% of the aggregate ordinary voting power represented by
         the issued and outstanding Equity Securities of the Borrower, (ii) the occupation of a majority of
         the seats (other than vacant seats) on the board of directors of the Borrower by Persons (other
         than a related party to the Lender or any of its affiliates or associates) who were neither
         (a) nominated by the board of directors of the Borrower, nor (b) appointed by the directors so
         nominated, or (iii) the acquisition of direct or indirect Control of the Borrower by any Person or
         group of Persons (other than the Lender or any of its affiliates or associates) acting jointly or
         otherwise in concert.

         “Closing Date” means August 18, 2010 or such other date as shall be agreed upon by the Lender
         and the Borrower.



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         “Commercial Production” means the date upon which the Borrower has provided evidence
         satisfactory to the Lender that the Mine has achieved over a consecutive 30 day period an average
         production rate of 6.3t of Nickel in concentrates per day.

         “Common Shares” means the common shares in the capital of the Borrower and “Common
         Share” means any one of them.

         “Common Share Issue Price” means €0.104743377, subject to immediate adjustment from time
         to time to reflect any subdivisions or consolidations of the Common Shares after the date of this
         Agreement and the Common Share Issue Price shall simultaneously be adjusted upon the
         happening of each such event by multiplying the Common Share Issue Price in effect
         immediately prior to such event by the following fraction:

         (a)       the numerator of which is the number of Common Shares issued and outstanding
                   immediately prior to the event, and

         (b)       the denominator of which is the number of Common Shares issued and outstanding
                   immediately after completion of the event.

         and any such adjustments shall be successive and each resulting new Common Share Issue Price
         shall continue in effect until the next adjustment (if any) is made.

         “Conversion Notice” means the notice in writing delivered by the Lender to the Borrower under
         Section 5.1.

         “Converted Securities” means the Common Shares issuable upon the conversion of the
         outstanding principal amount of the Loan under Section 5.1.

         “Constating Documents” means, with respect to a corporation, its articles or notice of articles of
         incorporation, amalgamation or continuance or other similar document and its by-laws or articles
         and with respect to a partnership, its partnership agreement and its certificate of registration, or
         other similar document, all as amended from time to time.

         “Contracts” means agreements, supplier agreements, franchises or leases entered into with or
         licenses, privileges and other rights acquired from any Person.

         “Control” or “Controlled” means the possession, directly or indirectly, of the power to direct or
         cause the direction of the management or policies of a Person, whether directly or indirectly, or to
         elect a majority of the board of directors or the trustees of a Person, whether through the
         ownership of voting securities, ownership interests or by contract.

         “Credit Limit” means €2,000,000.

         “Credit Documents” means this Agreement, the Security and all other documents delivered
         pursuant to this Agreement.

         “Debt Service Cover Ratio” means over any given period, the ratio of (A) Monthly Operating
         Profit generated by Belvedere Finland (as calculated according to the Mine Plan) less any capital
         investments, bonding payments and general corporate and administrative costs of the Borrower or
         any of its Subsidiaries, to (B) the amount of any repayments of principal falling due and interest
         accrued during that period.



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                                                      -4-


         “Default” means an event which, but for the requirement of the giving of notice, lapse of time, or
         both would constitute an “Event of Default”.

         “Distribution” means:

         (a)       any declaration or payment of dividends, royalties, distributions, fees or management fees
                   of any kind directly or indirectly to any holder of Shares of any Person;

         (b)       any repurchase, retraction or redemption of Shares for cash or Property;

         (c)       any loan or advance that is made by a Person to or in favour of a holder of Shares in such
                   Person, to an affiliate of such holder or to an affiliate of such Person except to the extent
                   to which any such loan or advance is immediately used to subscribe for shares of such
                   Person; or

         (d)       the transfer by a Person of any of its property or assets for consideration of less than fair
                   market value thereof, to any holder of Shares in such Person, to an affiliate of such holder
                   or to any affiliate of such Person.

         For greater certainty, a Distribution does not include the conversion of a loan to a capital loan, as
         contemplated by Chapter 12 of the Finnish Companies Act (21.7.2006/624, as amended).

         “Encumbrance” means any mortgage, debenture, pledge, hypothec, lien, charge, assignment by
         way of security, title retention, consignment, lease, hypothecation, security interest or other
         security agreement or trust, right of set-off or other arrangement having the effect of security for
         the payment of any debt, liability or obligation, and “Encumbrances”, “Encumbrancer”,
         “Encumber” and “Encumbered” shall have corresponding meanings.

         “Euros” or the designation “€” means the currency introduced on January 1, 1999 at the third
         stage of the European economic and monetary union pursuant to the Treaty.

         “Event of Default” has the meaning defined in Section 9.1.

         “Financial Statements” means the financial statements of the Borrower and its Subsidiaries
         prepared on a consolidated and unconsolidated basis as at a specified date and for the period then
         ended and shall include a balance sheet, statement of income and retained earnings, statement of
         cash flows and application of funds, together with comparative figures in each case (where a
         comparative period on an earlier statement exists), all prepared, maintained and stated in
         accordance with GAAP applied consistently.

         “GAAP” means generally accepted accounting principles which are in effect from time to time in
         Canada, as published in the Handbook of the Canadian Institute of Chartered Accountants,
         applied on a consistent basis, and includes, for greater certainty, International Financial Reporting
         Standards when those are adopted by the Borrower.

         “Governmental Authority “ means:

         (a)       any government, parliament or legislature, any regulatory or administrative authority,
                   agency, commission or board and any other statute, rule or regulation making entity
                   having jurisdiction in the relevant circumstances,




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         (b)       any Person acting within and under the authority of any of the foregoing or under a
                   statute, rule or regulation thereof, and

         (c)       any judicial, administrative or arbitral court, authority, tribunal or commission having
                   jurisdiction in the relevant circumstances.

         “Hazardous Materials” means any hazardous substance or any pollutant or contaminant, toxic
         or dangerous waste, substance or material, as defined in or regulated by any Applicable Law,
         regulation or governmental authority from time to time, including, without limitation, asbestos
         and polychlorinated biphenyls.

         “Indebtedness” of any Person means, without duplication, (a) all obligations of such Person for
         borrowed money, (b) all obligations of such Person evidenced by bonds, debentures, notes or
         similar instruments, (c) all obligations of such Person upon which interest charges are customarily
         paid (other than trade payables), (d) all obligations of such Person under conditional sale or other
         title retention agreements relating to property acquired by such Person, (e) all obligations of such
         Person in respect of the deferred purchase price of property or services (excluding accrued and
         current accounts payable incurred in the ordinary course of business), (f) all Indebtedness of
         others secured by (or for which the holder of such Indebtedness has an existing right, contingent
         or otherwise, to be secured by) any lien on property owned or acquired by such Person, whether
         or not the Indebtedness secured thereby has been assumed, (g) all guarantees by such Person of
         Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i) all obligations,
         contingent or otherwise, of such Person as an account party in respect of letters of credit and
         letters of guarantee, (j) all obligations, contingent or otherwise, of such Person in respect of
         bankers’ acceptances, and (k) obligations under any liquidated earn-out. The Indebtedness of any
         Person shall include, without duplication, the Indebtedness of any other entity (including any
         partnership in which such Person is a general partner) to the extent such Person is liable therefor
         as a result of such Person’s ownership interest in or other relationship with such entity, except to
         the extent the terms of such Indebtedness provide that such Person is not liable therefor.

         “Interest Period” means the interest period which shall, at the option of the Borrower, be a one,
         two or three month period; provided that (i) the initial Interest Period shall commence on the date
         of an Advance and each Interest Period occurring thereafter shall commence on the day on which
         the next preceding Interest Period applicable thereto expires; (ii) if any Interest Period begins on a
         day for which there is no numerically corresponding day in the calendar month at the end of such
         Interest Period, such Interest Period shall end on the last Business Day of such calendar month;
         (iii) if any Interest Period would otherwise expire on a day which is not a Business Day, such
         Interest Period shall expire on the next succeeding Business Day; provided, however, that if any
         Interest Period would otherwise expire on a day which is not a Business Day but is a day of the
         month after which no further Business Day occurs in such month, such Interest Period shall
         expire on the next preceding Business Day; and (iv) no Interest Period shall be selected which
         extends beyond the Maturity Date.

         “Investment” means (a) any loan or other extension of credit (including the delivery of
         guarantees, indemnities or other financial assistance) or capital contribution (including a transfer
         of property) to, or acquisition of any Shares, bonds, notes, debentures or other securities of, any
         Person, (b) any deposit accounts and certificates of deposit owned by a Person (other than deposit
         accounts and certificates of deposit maintained with the Lender), and (c) any purchase of any
         assets constituting all or part of a business unit from any Person; and “Invest” and “Invested”
         shall be construed accordingly.




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                                                     -6-


         [Redacted - definition]

         “Lender” means Investec Bank plc and its successors and assigns.

         [Redacted – definition]

         [Redacted – definition]

         “Loan” means the non-revolving loan more particularly described in Section 2.1.

         “Material Adverse Effect” means any such matter, event or circumstance that individually or in
         the aggregate could, acting reasonably, be expected to have a material adverse effect on:

         (a)       the business, financial condition, operations, property, assets or undertaking of the
                   Borrower or its Subsidiaries, taken as a whole, including without limitation the Mine;

         (b)       the ability of the Borrower or its Subsidiaries to pay and perform their Obligations in
                   accordance with this Agreement or any of the Security;

         (c)       the validity or enforceability of this Agreement or any other Credit Document;

         (d)       the rights and remedies of the Lender under the Credit Documents; or

         (e)       the priority ranking of any of the Encumbrances granted by the Security or the rights or
                   remedies intended or purported to be granted to the Lender under or pursuant to the
                   Security, other than Encumbrances that the Lender in its reasonable discretion, considers
                   immaterial or duplicative.

         “Maturity Date” means December 30, 2011.

         “Mine Plan” means the development, mining and processing plans for the Mine prepared by the
         Borrower and reviewed by the Lender as part of its due diligence and set out in the financial
         model “Hitura Production and Income Sheet 2010 - 2011 07072010.xls” or such other plans as
         may be approved by the Lender in accordance with Section 7.1.

         “Obligations” means all of the present and future indebtedness, liabilities and obligations, direct
         or indirect, absolute or contingent, matured or unmatured of the Borrower and its Subsidiaries
         owing to the Lender under, pursuant to or in connection with the Credit Documents, including
         without limitation all principal, interest, fees, indemnities, costs and expenses owing by the
         Borrower and its Subsidiaries thereunder, including all costs of realization.

         “Offtake Agreement” [Redacted – definition].

         “Permits” means governmental licenses, authorizations, consents, registrations, exemptions,
         permits and other approvals required by Applicable Law.

         “Permitted Encumbrances” means, with respect to any Person, the following:

         (a)       Encumbrances for taxes, rates, assessments or other governmental charges or levies not
                   yet due (or if overdue are being contested by such Person diligently and in good faith by
                   appropriate proceedings);



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                                                      -7-


         (b)       Purchase Money Security Interests and Capital Leases which in the aggregate do not at
                   any time secure obligations exceeding €100,000;

         (c)       inchoate Encumbrances imposed or permitted by laws such as garagemens’ liens,
                   carriers’ liens, builders’ liens, materialmens’ liens and other liens, privileges or other
                   charges of a similar nature which relate to obligations not due or delinquent or if due or
                   delinquent are being contested by such Person diligently and in good faith by appropriate
                   proceedings;

         (d)       Encumbrances to secure its assessments or current obligations which are not at the time
                   overdue or otherwise dischargeable by the payment of money, and which are incurred in
                   the ordinary course of its business under workers’ compensation laws, unemployment
                   insurance or other social security legislation or similar legislation, provided that such
                   Encumbrances are in amounts commensurate with such current obligations;

         (e)       Encumbrances or any rights of distress reserved in or exercisable under any lease or
                   sublease to which it is a lessee which secure the payment of rent or compliance with the
                   terms of such lease or sublease, provided that such rent is not then overdue and it is then
                   in compliance in all material respects with such terms;

         (f)       the right reserved to or vested in any Governmental Authority by the terms of any lease,
                   license, grant or Permit or by any statutory or regulatory provision to terminate any such
                   lease, license, grant or permit or to require annual or other periodic payments as a
                   condition of the continuance thereof;

         (g)       the Security;

         (h)       any Encumbrance over the elemental on-stream analyzer pursuant to the lease
                   arrangement between Belvedere Finland and [Redacted – name]; and

         (i)       other Encumbrances agreed to in writing by the Lender;

         provided that in each case where it is contesting any obligations, taxes or assessments as
         contemplated herein, such Encumbrances shall only be Permitted Encumbrances (A) if such
         Person establishes to the satisfaction of the Lender (acting reasonably) a sufficient reserve for, or
         if requested by the Lender after the Lender (acting reasonably) believes that a determination
         adverse to such Person could be reasonably expected, deposits with a court of competent
         jurisdiction or the assessing authority, or to such other Person as is acceptable to the Lender,
         acting reasonably, sufficient funds or a surety bond, for the total amount claimed to be secured by
         such Encumbrances, where the application of such reserve, funds or bond would result in their
         discharge, and (B) for so long as such contestation effectively postpones the enforcement of the
         rights of the holder thereof.

         “Person” means any individual, sole proprietorship, corporation, company, partnership,
         unincorporated association, association, institution, entity, party, trust, joint venture, estate or
         other judicial entity or any governmental body.

         “Primary Exchange” means the TSX Venture Exchange, any successor or associated exchange
         to such exchange, or another stock exchange where a majority of the trading value of the common
         shares of the Borrower occurs.




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                                                      -8-


         “Property” means, with respect to any Person, all or any portion of its property, assets and
         undertaking.

         “Purchase Money Obligations” means any indebtedness incurred, assumed or owed by the
         Borrower or any of its Subsidiaries as all or part of, or incurred or assumed by the Borrower or
         such Subsidiary to provide funds to pay all or part of the purchase price of any property or assets
         acquired by the Borrower or such Subsidiary provided that:

         (a)       the aggregate principal amount of all such indebtedness does not, at any time, exceed
                   €100,000; and

         (b)       none of the Borrower or any of its Subsidiaries or an affiliate thereof, immediately prior
                   to entering into an agreement for the acquisition of such property or assets, owns or has
                   any interest in, or any entitlement to own, or has any interest in, the property or assets or
                   a portion thereof being so acquired.

         “Purchase Money Security Interest” means an Encumbrance created by the Borrower or any of
         its Subsidiaries securing Purchase Money Obligations, provided that (i) such Encumbrance is
         created substantially simultaneously with the acquisition of such assets, (ii) such Encumbrance
         does not at any time encumber any property other than the property financed by such Purchase
         Money Obligations, (iii) the amount of Purchase Money Obligations secured thereby is not
         increased subsequent to such acquisition, and (iv) the principal amount of Purchase Money
         Obligations secured by any such Encumbrance at no time exceeds 100% of the original purchase
         price of such property at the time it was acquired, and in this definition, the term “acquisition”
         shall include, without limitation, a Capital Lease, and the term “acquire” shall have a
         corresponding meaning.

         “Receivable” means an account receivable owing from the provision of services by a Person to
         its customers.

         “Related Party” means, with respect to any Person, an affiliate of such Person, a shareholder of
         such Person (if applicable) or a Person related to such Person or shareholder of such Person.

         “Requirement of Law” means, as to any Person, any law, treaty, regulation, ordinance, decree,
         judgment, order or similar requirement made or issued under sovereign or statutory authority and
         applicable to or binding upon that Person, or to which that Person or any of its Property is subject.

         “Responsible Officer” means the chief executive officer, president, any executive vice-president,
         the chief financial officer, any vice-president, treasurer or other officer of the Borrower.

         “Section” means the designated section of this Agreement.

         “Security” means the security described in Section 6.1, which secures or intends to secure the
         payment and performance of the Obligations.

         “Settlement of Guarantee” [Redacted – definition]

         “Shares” means shares in the capital stock of any corporation or other ownership interests in a
         partnership or other Person including without limitation, shares, units or interests which carry a
         residual right to participate in the earnings of such corporation, partnership or other Person or,




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                                                      -9-


         upon the liquidation or winding up of such corporation, partnership or other Person, to share in its
         assets.

         “Specified Amount” means all or any part of the outstanding principal amount of the Loan as
         specified in a Conversion Notice delivered to the Borrower by the Lender under Section 5.1.

         “Specified Date” means the date for conversion specified in the Conversion Notice delivered
         under Section 5.1.

         “subsidiary” means, with respect to any Person (the “parent”) at any date, any corporation,
         limited liability company, partnership, association or other entity the accounts of which would be
         consolidated with those of the parent in the parent’s consolidated financial statements if such
         financial statements were prepared in accordance with GAAP as of such date, as well as any other
         corporation, limited liability company, partnership, association or other entity (a) of which
         securities or other ownership interests representing more than 50% of the equity or more than
         50% of the ordinary voting power or, in the case of a partnership, more than 50% of the general
         partnership interests are, as of such date, owned, controlled or held, or (b) that is, as of such date,
         otherwise controlled, by the parent or one or more subsidiaries of the parent or by the parent and
         one or more subsidiaries of the parent.

         “Subsidiary” means any direct or indirect subsidiary of the Borrower, including, without
         limitation Belvedere Finland and Belvedere BV.

         “Taxes” means all taxes, levies, imposts, stamp taxes, duties, deductions, withholdings and
         similar impositions payable, levied, collected, withheld or assessed as of the date of this
         Agreement or at any time in the future under the laws of Canada, any other jurisdiction or any
         political subdivision thereof, and “Tax” shall have a corresponding meaning.

                                                ARTICLE II
                                                THE LOAN

2.1      Amount and Availment Options

        Subject to the terms and conditions of this Agreement, the Lender agrees to provide a loan to the
Borrower in an amount up to the Credit Limit, advanced by way of multiple drawdowns (each an
“Advance”) commencing on the Closing Date and ending up to and including the date that is 3 months
from the date of Closing Date (such period being collectively, the “Availability Period”). An Advance
will be available to the Borrower by providing a duly completed drawdown notice to the Lender not less
than 3 Business Days prior to the drawdown date, in the form attached hereto as Schedule B. Each
Advance shall be available in a minimum amount of €500,000.

       From the end of the Availability Period to and including December 30, 2010, the Borrower may
have Advances to pay accrued and unpaid interest on the Loan, provided the amount outstanding under
the Loan and the amount of all Advances for the payment of interest, including the requested Advance, is
below €2,000,000.

       No undrawn amounts at the end of the Availability Period may be drawn, other than as set out
above and the Credit Limit shall be reduced accordingly.




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2.2      Use of the Advances

         The Loan will be used by the Borrower solely for capital requirements and general working
capital purposes at the Hitura Nickel Mine in Finland (the “Mine”) as set out in the Mine Plan, financing
studies on the feasibility of the gold deposit at the Kopsa gold property in Finland, and financing the
closing costs of the Borrower incurred in entering into this Loan and to pay accrued and unpaid interest
on the Loan, as contemplated by Section 2.1.

                                             ARTICLE III
                                  TERM, PREPAYMENT AND REPAYMENT

3.1      Term

        Subject to the Lender’s right to demand accelerated payment upon an Event of Default, all
outstanding Obligations shall be immediately due and payable by the Borrower on the Maturity Date.

3.2      Voluntary Prepayments

         The Borrower may upon five (5) Business Days’ written notice to the Lender, at any time prepay
all or any part of the Loan in a minimum amount of €100,000 without payment of any premium or other
amount, by paying to the Lender such principal amount which the Borrower wishes to prepay together
with accrued and unpaid interest on such amount being prepaid to the date of prepayment. Any such
prepayment, other than a repayment in full and subject to the satisfaction of all Obligations, shall not
result in the cancellation of the Security. Any such prepayment shall be applied in inverse order of
maturity and cannot be reborrowed.

3.3      [Intentionally Deleted]

3.4      [Intentionally Deleted]

3.5      Repayment

        The Borrower will pay to the Lender the unpaid principal amount of the Loan in installments in
the amounts and on the dates set forth below (in each case as reduced by the application of any
prepayment made pursuant to Section 3.2, 3.6 or by the Specified Amount of any conversion under
Article 5):

                              31/3/2011              €250,000

                              30/6/2011              €350,000

                              30/9/2011              €400,000

                              30/12/2011             €1,000,000




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3.6      Mandatory Prepayment

        The Borrower shall and shall procure that its Subsidiaries shall, pay to the Lender in prepayment
of the Loan:

         (a)       upon achieving Commercial Production, an amount equal to the lesser of (i) 75% of any
                   grants received by the Borrower or Belvedere Finland from any Governmental Authority
                   prior to such date, and (ii) the remaining amounts of such grants after any deductions
                   permitted under Section 9.2(w);

         (b)       after Commercial Production an amount equal to 75% of any grants received by the
                   Borrower or Belvedere Finland from any Governmental Authority after such date, within
                   10 Business Days of receipt of same; and

         (c)       in the event of an insured event which causes the suspension of operations (or a material
                   part thereof), the proceeds of any insurance claim in excess of €100,000, within 10
                   Business Days of receipt of same.

        Any such prepayment, other than a repayment in full and subject to the satisfaction of all
Obligations, shall not result in the cancellation of the Security. Any such prepayment shall be applied in
inverse order of maturity and cannot be reborrowed.

                                             ARTICLE IV
                                     PAYMENT OF INTEREST AND FEES

4.1      Interest

         [Redacted – rate of interest]

4.2      Default Interest Rate

         If the Borrower fails to pay any amount payable hereunder (including, without limitation,
principal, interest thereon or interest upon interest) on the due date therefor, the Borrower shall pay
interest on such overdue amount to the Lender from and including such due date up to and including the
date of actual payment, both before and after judgment, at the default rate of 2% more than the rate then
in effect pursuant to Section 4.1, calculated daily and compounded monthly and payable on demand by
the Lender.

4.3      Interest Payments

        If the date for payment of interest falls on a day which is not a Business Day, the due date for
payment of such interest shall instead be the next Business Day in that calendar month (if there is one) or
the preceding Business Day (if there is not).

4.4      Conversion

         In the event the Lender exercises its right to convert a Specified Amount into Common Shares as
set out in Article 5, the Borrower will pay to the Lender on the Specified Date the amount of unpaid
interest on the Specified Amount to the Specified Date.




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4.5      Break Costs

      Upon 3 Business Days prior notice by the Lender to the Borrower, the Borrower agrees to
compensate the Lender for any Break Costs.

                                                  ARTICLE V
                                                 CONVERSION

5.1      Conversion to Common Shares

         At any time after the date of this Agreement and on or before the date on which the outstanding
principal amount of the Loan and accrued interest are repaid in full, the Lender, at its sole option, shall be
entitled to deliver a Conversion Notice to the Borrower specifying that the automatic conversion of the
Specified Amount shall take place on the Specified Date and, if any such Conversion Notice is delivered
to the Borrower, the Specified Amount of the outstanding principal amount of the Loan shall be
automatically converted into Common Shares on the Specified Date in accordance with Sections 5.2, 5.3
and 5.4 at the Common Share Issue Price.

5.2      No Fractional Securities

         No fractional securities shall be issued and if the conversion provided for in Section 5.1 would
result in the Lender being entitled to receive a fraction of a security, the Borrower shall instead issue upon
the conversion the next lesser whole number of securities.

5.3      Mechanics of Conversion

         On the Specified Date:

         (a)       the Borrower shall deliver to the Lender:

                   (i)       a certificate(s) or other document(s) evidencing the Converted Securities;

                   (ii)      a certified cheque, bank draft or solicitors trust cheque in the amount of any
                             remaining interest accrued but unpaid under this Agreement with respect to the
                             Specified Amount as of the Specified Date; and

                   (iii)     such other documents as the Lender may reasonably require, including, but not
                             limited to, an opinion of counsel satisfactory to the Lender, acting reasonably, to
                             the effect that such Converted Securities are duly and validly issued, fully paid
                             and non-assessable, free from pre-emptive rights, and issued in compliance with
                             applicable securities laws.

        The Lender shall be treated for all purposes as the record holder of such Converted Securities as
of the Specified Date and upon delivery of the items listed in Subsection 5.3(a), above, the principal
amount of the Loan shall be reduced accordingly.

5.4      Duly and Validly Issued

        The Borrower covenants with the Lender that the Common Shares issued to the Lender upon
conversion of any of the outstanding principal amount of the Loan under this Article shall, when issued,
be duly and validly issued and fully paid and non-assessable.



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5.5      Adjustments with Changes to Common Shares

         If at any time and from time to time after the date of this Agreement, the Common Shares are
changed into a different class or classes of shares, whether by reclassification, recapitalization,
reorganization, arrangement, amalgamation or merger, then the Lender shall have the right thereafter to
convert the principal amount of the Loan in the manner set out in Section 5.1 into the kind and amount of
shares and other securities and property receivable upon such change by holders of the number of the
Common Shares into which the principal amount of the Loan could have been converted immediately
prior to such change.

                                                 ARTICLE VI
                                                  SECURITY

6.1      Security

        The Security to be provided to the Lender for the granting of the Loan will consist of the
following:

         (a)       a pledge of all issued and outstanding Shares of Belvedere Finland and Belvedere Fin
                   Gold;

         (b)       a general security agreement granted by the Borrower which includes, without limitation,
                   a pledge of the Shares in Belvedere BV;

         (c)       a warrant instrument granted by the Borrower (the “Warrant Instrument”);

         (d)       a guarantee from Belvedere Finland; and

         (e)       a general security agreement granted by Belvedere Finland, which includes, without
                   limitation, an assignment of receivables of the Offtake Agreement, a floating charge, a
                   pledge of mining rights and a pledge of bank account.

        The Security listed above shall be in form and substance satisfactory to the Lender, acting
reasonably. The Lender shall, at the Borrower’s expense, register, file or record the Security in all offices
where such registration, filing or recording is necessary or of advantage to the creation, perfection and
preserving of the charges and security interests created by the Security.

                                                ARTICLE VII
                                         DISBURSEMENT CONDITIONS

7.1      Conditions Precedent to the initial Advance

        The obligation of the Lender under this Agreement to make the initial Advance is subject to and
conditional upon the following (unless otherwise waived by the Lender, in its discretion):

         (a)       receipt by the Lender, of the following documents, each in full force and effect, and in
                   form and substance satisfactory to the Lender, acting reasonably:

                   (i)       this Agreement, duly executed and delivered by the Borrower;

                   (ii)      certified copies of the Constating Documents of the Borrower and each of its
                             Subsidiaries;


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                                                       - 14 -


                   (iii)     certificates of incumbency of the Borrower and each of its Subsidiaries;

                   (iv)      certified copies of the resolutions of the board of directors of the Borrower and
                             its Subsidiaries authorizing the execution, delivery and performance of their
                             respective obligation under the Credit Documents;

                   (v)       duly executed copies of the Security duly registered (except in the case of the
                             Security set out in Section 6.1(a) and (e), where it will have been duly submitted
                             for registration), where applicable;

                   (vi)      releases, discharges and postponements (in registrable form where appropriate)
                             covering all Encumbrances affecting the collateral Encumbered by the Security
                             which are not Permitted Encumbrances, if any, or undertakings satisfactory to the
                             Lender to provide such releases, discharges and postponements;

                   (vii)     letter of opinion of Edwards, Kenny & Bray LLP, addressed to the Lender
                             relating to, among other things, the subsistence of the Borrower and its
                             Subsidiaries, and the due authorization, execution, delivery and enforceability of
                             the Credit Documents to which the Borrower and its Subsidiaries are a party; and

                   (viii)    letter of opinion of [Redacted – name] addressed to the Lender;

         (b)       the Borrower shall have paid all fees, costs and expenses then due in respect of the Loan;

         (c)       the Lender shall be satisfied with its review of all material Contracts of the Borrower and
                   its Subsidiaries (including, without limitation, the Offtake Agreement) and with the
                   results of the Lender’s due diligence relating to the Borrower and its Subsidiaries
                   (including, without limitation, accounting, technical, business, environmental, regulatory,
                   tax and legal review and discussions with customers, suppliers and employees);

         (d)       the Lender shall be satisfied that all Permits required to operate and maintain the Mine
                   are in place in accordance with the Mine Plan;

         (e)       no event or circumstance shall have occurred that would reasonably be expected to have a
                   Material Adverse Effect;

         (f)       the Lender shall be satisfied with the corporate and capital structure of the Borrower, the
                   indebtedness owing to existing lenders and other related transactions;

         (g)       the Lender and its counsel shall be satisfied with the results of their review of all material
                   agreements, including, without limitation, in connection with any existing or proposed
                   borrowings and/or leases of the Borrower and its Subsidiaries;

         (h)       receipt of evidence, to the satisfaction of the Lender, that appropriate levels of insurance
                   are in place;

         (i)       receipt by the Lender of the Mine Plan, in form and substance satisfactory to the Lender;

         (j)       the Lender shall be satisfied with its review of a schedule of inter-company transactions
                   between the Borrower and each of its Subsidiaries;




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                                                       - 15 -


         (k)       receipt of an upfront fee (the “Upfront Fee”) in an amount equal to 5% of the Loan
                   payable in cash or by certified cheque or wire transfer by the Borrower to the Lender on
                   the date hereof; provided that the Borrower shall have the option to pay the Upfront Fee,
                   in whole or in part, by issuing to the Lender 1,000,000 common shares in the Borrower at
                   a price per share equal to the closing price of the commons shares on the Primary
                   Exchange on the previous trading day to the date hereof. The Borrower agrees that the
                   Upfront Fee may be deducted by the Lender from the initial Advance, if not previously
                   satisfied by the Borrower; and

         (l)       receipt of all regulatory, securities and/or third party consents and/or approvals in form,
                   and on terms, satisfactory to the Lender, including for the avoidance of doubt the
                   approval of the Warrant Instrument by the Primary Exchange.

7.2      Conditions Precedent to each Advance

         The obligation of the Lender under this Agreement to make an Advance is subject to and
         conditional upon the following (unless otherwise waived by the Lender, in its discretion):

         (a)       no Default is continuing or would result from the proposed Advance; and

         (b)       the representations and warranties as set out in Article 8 are true in all material respects.

7.3      Waiver

       The conditions in Sections 7.1 and 7.2 are inserted for the sole benefit of the Lender and may be
waived by the Lender, in whole or in part (with or without terms or conditions).

                                           ARTICLE VIII
                                  REPRESENTATIONS AND WARRANTIES

8.1      Representations and Warranties

         The Borrower represents and warrants to the Lender that:

         (a)       each of the Borrower and its Subsidiaries are duly organized, validly existing and in good
                   standing under the laws of the jurisdiction of its organization, has all requisite power and
                   authority to carry on its business as now conducted and is qualified to do business in, and
                   is in good standing in, every jurisdiction where such qualification is required;

         (b)       the Borrower and each of its Subsidiaries have the corporate power and authority to own
                   or lease their Property, including with respect to Belvedere Finland, the Mine, to carry on
                   and conduct their business as presently conducted and to borrow money hereunder and to
                   perform their obligations under each Credit Document to which each is a party;

         (c)       the Borrower and each of its Subsidiaries have obtained and maintained all Permits and
                   licenses necessary for the ownership of their Property, including, with respect to
                   Belvedere Finland, all Permits required for the operation and maintenance of the Mine in
                   accordance with the Mine Plan, and the conduct of their business in each jurisdiction
                   where it carries on material business or owns material Property, and each such Permit or
                   license is in full force and effect;




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                                                        - 16 -


         (d)       the Borrower is a reporting issuer in the Provinces of British Columbia and Alberta and
                   as of the date hereof will have been a reporting issuer in such Provinces for a period of at
                   least 4 months;

         (e)       the Borrower and each Subsidiary are duly authorized to execute and deliver the Credit
                   Documents to which they are a party and to perform their obligations thereunder; and all
                   corporate and other steps and proceedings necessary for the due execution and delivery
                   by it of the Credit Documents to which the Borrower and each of its Subsidiaries are a
                   party and the performance of their obligations thereunder have been taken;

         (f)       the Credit Documents have been duly executed and delivered by the Borrower and each
                   Subsidiary, and constitute legal, valid and binding obligations, enforceable in accordance
                   with their respective terms, subject to the rights of creditors generally and rules of equity
                   of general application;

         (g)       the execution and delivery by the Borrower and each of its Subsidiaries of the Credit
                   Documents and the performance by them of their obligations thereunder, do not and will
                   not:

                   (i)       contravene, violate or result in a breach of their Constating Documents or any
                             shareholders’ agreement (or other similar agreement) relating to it;

                   (ii)      contravene, violate or result in a breach of any Applicable Law;

                   (iii)     contravene, violate or result in a breach of any material Contract to which they
                             are a party or to which their Property is bound, including, without limitation,
                             under the Offtake Agreement;

                   (iv)      contravene, violate or result in a breach of any resolution of its directors, officers
                             or partners or any committee thereof;

                   (v)       result in the creation or imposition of any Encumbrance on any of their Property
                             other than in favour of the Lender; or

                   (vi)      result in any requirement on it to grant any Encumbrance or result in any Person
                             becoming entitled to call for any Encumbrance from them other than in favour of
                             the Lender;

         (h)       no consent, authorization, approval or other action by, and no publication, notice to or
                   filing or registration with, any Governmental Authority is required for the due execution
                   and delivery by the Borrower or any Subsidiary of the Credit Documents, and the
                   performance by them of their Obligations thereunder or to ensure the validity or
                   enforceability thereof other than filings and registrations necessary to perfect and protect
                   the Encumbrances constituted by the Security and the acceptance of the Primary
                   Exchange;

         (i)       there are no actions, suits, claims or proceedings (including counterclaims or third party
                   proceedings) existing or, threatened against the Borrower or any of its Subsidiaries or
                   affecting any of their Property before any Governmental Authority which could
                   reasonably be expected to have a Material Adverse Effect;




50723836.550723836-Convertible Loan Agreement
                                                      - 17 -


         (j)       in respect of each material Contract to which the Borrower or any of its Subsidiaries is a
                   party, and each material Governmental Authority license, franchise, approval or permit of
                   which the Borrower or a Subsidiary is a holder:

                   (i)       neither the Borrower nor any Subsidiary has defaulted in any material respect in
                             the performance or observance of any of the terms or conditions contained or
                             referenced therein, other than the failure to comply with the closure obligations
                             under the environmental permit as referred to in the minutes of the meeting with
                             the applicable Governmental Authority dated January 12, 2010 (the
                             “Environmental Permit”); and

                   (ii)      to the knowledge of the Borrower, no other party thereto is in default thereunder
                             in any material respect, nor has any such party taken any action to terminate the
                             same;

         (k)       the Borrower and each of its Subsidiaries is in compliance in all material respects with all
                   Applicable Laws and all material Contracts to which each is a party or by which each is
                   bound;

         (l)       no Event of Default and no Default has occurred and is continuing hereunder or under
                   any of the other Credit Documents;

         (m)       the authorized capital of the Borrower consists of an unlimited number of Common
                   Shares of which 119,218,005 are issued and outstanding as of the date hereof (the
                   “Issued Shares”) and an unlimited number of Class A Series 1 Preferred Shares, of
                   which 7,675,705 are issued and outstanding as of the date hereof;

         (n)       the Issued Shares are listed and posted for trading on the Primary Exchange and the
                   Borrower is not in material default of any of the listing requirements of such exchange;

         (o)       except for any options, warrants, agreements and convertible notes described in Schedule
                   A, no person has or will have any right, agreement or option for the purchase or other
                   acquisition of any of the common shares of the Borrower or any other security
                   convertible into or exchangeable for common shares of the Borrower;

         (p)       any common shares of the Borrower issued in satisfaction of payment of any portion of
                   the Upfront Fee will be validly issued and outstanding as fully paid and non-assessable
                   shares in the capital of the Borrower;

         (q)       the authorized capital of Belvedere BV consists of 900 Ordinary Shares of which 180 are
                   issued and outstanding as of the date hereof and the Borrower is the registered owner
                   thereof;

         (r)        the authorized capital of Belvedere Finland consists of 2.500 shares of which 2.500
                   shares are issued and outstanding as of the date hereof and Belvedere BV is the registered
                   owner thereof;

         (s)       the authorized capital of Belvedere Fin Gold consists of 100 shares of which 100 shares
                   are issued and outstanding as of the date hereof and Belvedere BV is the registered owner
                   thereof;




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                                                      - 18 -


         (t)       the authorized capital of Belvedere UK consists of 100 Ordinary Shares of which 100 are
                   issued and outstanding as of the date hereof and the Borrower is the registered owner
                   thereof;

         (u)       the Borrower and each of its Subsidiaries have in full force and effect such policies of
                   insurance in such amounts issued by such insurers of recognized standing covering their
                   property, assets and undertaking, including, replacement cost and environmental damage
                   insurance, as are customarily maintained by Persons engaged in the same or similar
                   business in the locations where their properties and assets are located;

         (v)       all of the financial statements (the “Financial Statements”) and financial information
                   which has been furnished to the Lender in connection with this Agreement are complete
                   in all material respects and, to the knowledge of the Responsible Officers of the
                   Borrower, after reasonable inquiry, fairly present their respective financial positions as of
                   the dates referred to therein and have been prepared in accordance with GAAP;

         (w)       neither the Borrower nor any of its Subsidiaries are in default in any material respect
                   under any of the Permitted Encumbrances relating to them;

         (x)       the Borrower and each of its Subsidiaries have good and marketable title to their
                   Properties, free and clear of all Encumbrances and adverse claims, other than Permitted
                   Encumbrances, save for (i) the registration to title to the Properties transferred to
                   Belvedere Finland under the Agreement on Asset Purchase, dated February 15, 2010,
                   between Belvedere Finland and the estate of bankruptcy of Finn Nickel Oy, which
                   registration in the Finnish Title and Mortgage Register may be left in abeyance by a
                   decision of the registration authority in accordance with the Finnish Code of Real Estate
                   (12.4.1995/540; as amended); and (ii) the real estate mortgage note with certificate detail
                   7.2.2001/391 amounting to €16,800 and the real estate mortgage note with certificate
                   detail 7.2.2001/392 amounting to €8,400 registered in respect of the Property with
                   Finnish Land Register number 535-401-16-50;

         (y)       the Borrower and each of its Subsidiaries have duly filed on a timely basis all tax returns
                   required to be filed by them, and have paid all taxes and remittances which are due and
                   payable by them, and have paid all assessments and reassessments, and all other taxes,
                   governmental charges, governmental royalties, penalties, interest and fines claimed
                   against them (except where it is contesting the payment of same in good faith, and it has
                   established to the satisfaction of the Lender a sufficient reserve or, if requested by the
                   Lender (acting reasonably) deposited with a court of competent jurisdiction or assessing
                   authority (or with such other Person as is acceptable to the Lender) sufficient funds or a
                   surety bond, for the total amount claimed, where the application of such reserve, funds or
                   bond would result in the discharge of such claim and the contestation thereof postpones
                   the rights of the applicable Governmental Authority to enforce its collection remedies in
                   respect thereof); each of the Borrower and its Subsidiaries have made adequate provision
                   for, and all required installment payments have been made in respect of, taxes and
                   remittances payable for the current period for which returns are not yet required to be
                   filed; there are no agreements, waivers or other arrangements providing for an extension
                   of time with respect to the filing of any tax return or the payment of any taxes or
                   remittances described above; there are no actions or proceedings being taken by Canada
                   Revenue Agency or any other Governmental Authority to enforce the payment of any
                   taxes or remittances described above and it has no knowledge of any such actions or
                   proceedings being contemplated by such authorities;


50723836.550723836-Convertible Loan Agreement
                                                     - 19 -


         (z)       neither the Borrower nor its Subsidiaries are required to make any deduction for or on
                   account of Tax from any payment it may make to the Lender under any Credit
                   Document;

         (aa)      the Borrower and its Subsidiaries 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 they have an interest under valid, subsisting
                   and enforceable title documents or other recognized and enforceable agreements or
                   instruments, sufficient to permit it to explore the minerals relating thereto, all such
                   property, leases or claims and all property, leases or claims in which they have any
                   interest or right have been validly located and recorded in accordance with all Applicable
                   Laws and are valid and subsisting, they have all necessary surface rights, access rights
                   and other necessary rights and interests relating to the properties in which they have an
                   interest granting them the right and ability to explore for minerals, ore and metals for
                   development purposes as are appropriate in view of the rights and interest therein of it
                   (and in respect of the Mine, in accordance with the Mine Plan), with only such exceptions
                   as do not materially interfere with the use made by them 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 is currently in good
                   standing in its name and free and clear of all liens, charges and encumbrances, except for
                   Permitted Encumbrances;

         (bb)      the Borrower and its Subsidiaries are current with all material filings required to be made
                   in all jurisdictions in which they exist or carry on any material business, and the
                   Borrower and its Subsidiaries are not in default of any filings required to be made under
                   applicable securities laws, if applicable;

         (cc)      all management discussion and analysis, technical reports, press releases and other
                   disclosure documents of the Borrower, including all publicly filed financial statements,
                   contain no untrue statement of a material fact as at the date thereof nor do they omit to
                   state a material fact which, at the date thereof, was required to have been stated or was
                   necessary to prevent a statement that was made from being false or misleading in the
                   circumstances in which it was made and were prepared in accordance with and complied
                   with applicable securities laws;

         (dd)      there are no material liabilities of the Borrower, whether direct, indirect, absolute,
                   contingent or otherwise which are not disclosed or reflected in the Borrower’s Financial
                   Statements except those incurred in the ordinary course of business of the Borrower since
                   December 31, 2009 which are recorded in the books and records of the Borrower;

         (ee)      since December 31, 2009 there has not been any Material Adverse Effect on the right or
                   capacity of the Borrower or its Subsidiaries to carry on their business, except as disclosed
                   in the public record of the Borrower;

         (ff)      the Borrower has sufficient funds available (i) after taking into account the Loan, (ii)
                   available cash and (iii) forecasted expenditures, to fund the bonding requirement required
                   under the Environmental Permit;




50723836.550723836-Convertible Loan Agreement
                                                         - 20 -


         (gg)      no order ceasing or suspending trading in securities of the Borrower nor prohibiting the
                   sale of such securities has been issued to and is outstanding against the Borrower and no
                   investigations or proceedings for such purposes are pending or threatened;

         (hh)      to the best of the knowledge of the Borrower, no action has been taken by any persons
                   which would in any way limit, restrict or cause interference with (A) any mineral
                   exploration and development work which the Borrower or its Subsidiaries currently
                   propose to carry out on their mineral properties, or (B) the implementation of the Mine
                   Plan in all material respects;

         (ii)      except to the extent that any violation or other matter referred to in this subsection would
                   not reasonably be expected to result in a Material Adverse Effect:

                             (A)       neither the Borrower nor any of its Subsidiaries are in violation of, and
                                       each has operated their business at all times in compliance with, in all
                                       material respects, any applicable federal, provincial, municipal or local
                                       laws, regulations, orders, government decrees or ordinances with respect
                                       to environmental, health or safety matters (collectively, “Environmental
                                       Laws”);

                             (B)       no orders, directions or notices have been issued and remain outstanding
                                       pursuant to any Environmental Laws relating to the business or assets of
                                       the Borrower or any of its Subsidiaries;

                             (C)       neither the Borrower nor any of its Subsidiaries has failed to report to the
                                       proper federal, provincial, municipal or other political subdivision,
                                       government, department, commission, board, bureau, agency or
                                       instrumentality (domestic or foreign) the occurrence of any event which
                                       is required to be so reported by any Environmental Law; and

                             (D)       the Borrower and its Subsidiaries hold all material licenses, permits and
                                       approvals required under any Environmental Laws in connection with
                                       the operation of their business, the implementation of the Mine Plan and
                                       the ownership and use of their assets, all such licenses, permits and
                                       approvals are in full force and effect, and except for notifications and
                                       conditions of general application to assets of the type owned by the
                                       Borrower and its Subsidiaries, to the best of the knowledge of the
                                       Borrower neither it nor any of its Subsidiaries have received any
                                       notification pursuant to any Environmental Laws that any work, repairs,
                                       constructions or capital expenditures are required to be made by it as a
                                       condition of continued compliance with any Environmental Laws, or any
                                       license, permit or approval issued pursuant thereto, or that any license,
                                       permit or approval referred to above is about to be reviewed, made
                                       subject to limitation or conditions, revoke, withdrawn or terminated.

8.2      Survival of Representations and Warranties

        Unless expressly stated to be made as of a specific date, the representations and warranties made
in this Agreement shall survive the execution of this Agreement and all other Credit Documents. The
Lender shall be deemed to have relied upon such representations and warranties on the Closing Date as a
condition of making the initial Advance and all subsequent Advances hereunder.


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                                                     - 21 -


                                         ARTICLE IX
                            COVENANTS AND REPORTING REQUIREMENTS

9.1      Positive Covenants

         During the term of this Agreement, the Borrower covenants and agrees with the Lender that it
shall, and shall procure that Belvedere Finland shall:

         (a)       duly and punctually pay the Obligations due and payable at the times and places and in
                   the manner required by the terms thereof;

         (b)       use the Loan for the purposes set out in Section 2.2 and in accordance with the Mine
                   Plan;

         (c)       promptly provide the Lender with all information reasonably requested by the Lender
                   from time to time concerning the financial condition, business and Property of the
                   Borrower and its Subsidiaries and at all reasonable times and from time to time upon
                   reasonable notice, permit representatives of the Lender to inspect any of the Property of
                   the Borrower and its Subsidiaries, and to examine and take extracts from their financial
                   books, accounts and records, including but not limited to accounts and records stored in
                   computer data banks and computer software systems, and to discuss their financial
                   condition with their respective senior officers and (in the presence of such of their
                   representatives as they may designate) their auditors, the reasonable expense of all of
                   which shall be paid by the Borrower and its Subsidiaries, provided that the exercise of the
                   rights of the Lender under this paragraph is not more frequent than is reasonably
                   necessary;

         (d)       maintain insurance on all its, and its Subsidiaries’ Property with financially sound and
                   reputable insurance companies or associations including all-risk property insurance, and
                   comprehensive general liability insurance, in amounts and against risks that are
                   determined to be appropriate by the Borrower, acting prudently, furnish to the Lender, on
                   written request, but in any event annually, satisfactory evidence of the insurance carried
                   and notify the Lender of any claims they have made under the foregoing insurance
                   policies in excess of €100,000;

         (e)       maintain and preserve the existence, organization and status of the Borrower and its
                   Subsidiaries in each jurisdiction of organization and in each other jurisdiction in which
                   they carry on a business or own assets and make all corporate, partnership and other
                   filings and registrations necessary in connection therewith;

         (f)       continue to carry on the business currently being carried on and maintain all of the
                   Property of the Borrower and its Subsidiaries in good repair and working condition and
                   carry on and continuously conduct their business currently being conducted in an
                   efficient, diligent and businesslike manner and in accordance with standard industry
                   practices;

         (g)       except with the prior written approval of the Lender, cause Belvedere Finland to
                   implement the Mine Plan in all material respects; provided that Belvedere Finland may
                   switch to a continuous production model if, in the opinion of the Lender acting
                   reasonably, such change does not have an adverse effect on the ability of the Borrower or




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                                                     - 22 -


                   any of its Subsidiaries to pay and perform their Obligations in accordance with this
                   Agreement and the other Credit Documents;

         (h)       provide the Lender, within 5 Business Days of the end of each month, monthly
                   management, construction, operation and progress reports in relation to its assets in
                   general and including specific reports in relation to the Mine;

         (i)       promptly notify the Lender of any event which causes an unscheduled stoppage in the
                   mining, processing or shipment of ore for a period of more than 3 days;

         (j)       comply and cause its Subsidiaries to comply with Applicable Laws and obtain and
                   maintain all Permits necessary for the ownership of the Property of the Borrower and its
                   Subsidiaries and to the conduct of their business in each jurisdiction where the Borrower
                   and its Subsidiaries carry on business or own material Property, including but not limited
                   to those issued or granted by Governmental Authorities;

         (k)       duly file on a timely basis all tax returns required to be filed by the Borrower and its
                   Subsidiaries, and duly and punctually pay all business, goods and services, income,
                   capital and/or profits taxes and other governmental charges levied or assessed against
                   them or their Property;

         (l)       ensure that the Security granted by each of the Borrower and its Subsidiaries to the
                   Lender remains legal, valid, binding and enforceable, in accordance with its terms
                   (subject to Applicable Laws affecting the rights of creditors generally and rules of equity
                   of general application);

         (m)       cooperate with the Lender to permit the Lender to forthwith register, file and record the
                   Security (or notices, financing statements or other registrations in respect thereof) in all
                   proper offices where such registration, filing or recording may be reasonably necessary or
                   advantageous to perfect or protect the security interests constituted by the Security and
                   maintain all such registrations in full force and effect;

         (n)       promptly notify the Lender of any Event of Default, or any Default of which it becomes
                   aware;

         (o)       promptly notify the Lender on becoming aware of the occurrence of any litigation,
                   arbitration or other proceeding against or affecting the Borrower and its Subsidiaries
                   which could reasonably be expected to have a Material Adverse Effect and from time to
                   time provide the Lender with all reasonable information requested by the Lender
                   concerning the status thereof;

         (p)       promptly notify the Lender upon (i) learning of the existence of Hazardous Materials
                   located on, above or below the surface of any land which it or any of its Subsidiaries
                   controls or contained in the soil or water constituting such land (except those Hazardous
                   Materials being stored, used or otherwise handled in substantial compliance with
                   applicable Requirements of Law), and (ii) the occurrence of any material reportable
                   release, spill, leak, emission, discharge, leaching, dumping or disposal of Hazardous
                   Materials that has occurred on or from such land;




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         (q)       provide the Lender with such other documents, opinions, consents, acknowledgments and
                   agreements as are reasonably necessary to implement this Agreement and the Security
                   from time to time;

         (r)       promptly notify the Lender of any material notifications, orders, or claims received by it
                   or any of its Subsidiaries from contractual counterparties or Governmental Authorities;

         (s)       promptly provide the Lender with notice of any change (financial or otherwise) in the
                   business, affairs, operations, assets, liabilities (contingent or otherwise) or capital of the
                   Borrower or its Subsidiaries that has or could reasonably be expected to have a Material
                   Adverse Effect;

         (t)       promptly provide the Lender with such other information as the Lender may request from
                   time to time;

         (u)       establish a reserve account (the “Reserve Account”) with a depository institution
                   satisfactory to the Lender and over which the Lender has a first priority security interest,
                   for the purpose of receiving (i) any proceeds derived from the Offtake Agreement, (ii) a
                   draw under any letters of credit, and (iii) prior to Commercial Production, grants from
                   any Governmental Authority; and

         (v)       to amend or otherwise obtain a waiver of, before December 31, 2010, the June 30, 2011
                   redemption obligation (the “June Redemption Obligation”) set out in the Settlement of
                   Guarantee to a date following the Maturity Date (such amendment shall be in form and
                   substance satisfactory to the Lender) provided that the failure to obtain an amendment or
                   a waiver shall only constitute an Event of Default if the Borrower is unable to
                   demonstrate to the satisfaction of the Lender by February 28, 2011, that (i) it has or will
                   have sufficient funds available to satisfy the June Redemption Obligation and (ii) it will
                   be able to maintain a Debt Service Cover Ratio through to the Maturity Date of not less
                   than 1.5:1.

9.2      Negative Covenants

        During the term of this Agreement, the Borrower covenants and agrees with the Lender that
without the prior written consent of the Lender, it will not:

         (a)       other than as set out in Section 9.1(v), make any material change in the nature of the
                   business and operations of, or conduct any businesses or operations which are materially
                   different from those conducted by the Borrower and its Subsidiaries on the date hereof;

         (b)       make any change to the capital structure of the Borrower or any of its Subsidiaries;

         (c)       and will not permit any of its Subsidiaries, to consolidate, amalgamate or merge with any
                   other Person, enter into any joint venture, partnership, corporate reorganization or other
                   transaction intended to effect a consolidation, amalgamation or merger or liquidate, wind-
                   up or dissolve itself, or permit any liquidation, winding-up or dissolution;

         (d)       and will not permit its Subsidiaries, to enter into any transaction which is (a) a rate swap
                   transaction, basis swap, forward rate transaction, commodity swap, commodity option,
                   equity or equity index swap, equity or equity index option, bond option, interest rate
                   option, foreign exchange transaction, forward commodity transaction, credit derivative



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                                                       - 24 -


                   transaction, repurchase or reverse repurchase transaction, securities lending transaction,
                   cap transaction, floor transaction, collar transaction, currency swap transaction, cross-
                   currency rate swap transaction, currency option or any other similar transaction
                   (including any option with respect to any of these transactions) or (b) any combination of
                   these transactions. Notwithstanding the foregoing, the Borrower and its Subsidiaries may
                   enter into foreign exchange transaction in the ordinary course of business on a spot
                   market basis;

         (e)       do or permit anything to adversely affect the ranking or validity of the Security except by
                   incurring a Permitted Encumbrance;

         (f)       change its name or any of its Subsidiaries, change its or their principal or registered office
                   or do any act which may result in a change of its or their name or use or carry on business
                   under any name or style other than their legal name, without providing the Lender with
                   prior written notice thereof and promptly taking other steps, if any, as the Lender may, in
                   its discretion reasonably request to permit the Lender to maintain the perfection of the
                   Security with respect to the change in name or location;

         (g)       and will not permit its Subsidiaries, to create, incur, assume or permit any Indebtedness
                   other than (i) for the Obligations under this Agreement, (ii) as permitted by Section 9.2(p)
                   (iii) any Indebtedness resulting from any intercompany loans from the Borrower or
                   Belvedere BV to any of their Subsidiaries, (iv) in connection with any conversion of a
                   loan to a capital loan, as contemplated by Chapter 12 of the Finnish Companies Act
                   (21.7.2006/624, as amended) and (v) unsecured trade debt and other Indebtedness not
                   exceeding €100,000 in aggregate;

         (h)       and will not permit its Subsidiaries, to reduce their interest in the Mine or any assets
                   related thereto;

         (i)       and will not permit its Subsidiaries, to provide any guarantee, loans or other financial
                   assistance to any Person, other than (i) as permitted by Section 9.2(p), (ii) intercompany
                   loans from the Borrower or Belvedere BV to any of their Subsidiaries, (iii) in connection
                   with any conversion of a loan to a capital loan, as contemplated by Chapter 12 of the
                   Finnish Companies Act (21.7.2006/624, as amended) or (iv) the unsecured guarantee
                   granted by the Borrower to and in favour of [Redacted – name] in an amount not to
                   exceed €297,268 (the “[Redacted – name] Guarantee”);

         (j)       incorporate or acquire any Subsidiary not existing as at the date hereof or make any other
                   Investment;

         (k)       create, incur, assume or permit to exist any Encumbrance upon any of the Property of the
                   Borrower or any of its Subsidiaries, except Permitted Encumbrances;

         (l)       and will not permit any of its Subsidiaries, to sell, lease, assign, transfer, convey or
                   otherwise dispose of any of their Property (including, without limitation, the Mine), other
                   than the sale of inventory in the ordinary course of business, the rental of inventory held
                   for sale and the disposal of obsolete equipment or redundant assets;

         (m)       permit the sale or transfer by it or any of its Subsidiaries of any of their Shares;




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                                                      - 25 -


         (n)       and will not permit any of its Subsidiaries, to establish or materially amend benefit plans,
                   profit sharing plans or other such contracts with shareholders, directors, officers, senior
                   management or employees, other than the repricing of certain options to be considered by
                   the Borrower’s shareholders at its 2010 annual general meeting and other than entering
                   into contracts with, and making payments of bonuses to, those employees (other than
                   senior management) consistent with standard industry practice;

         (o)       and will not permit any of its Subsidiaries, to engage in any Related Party transaction
                   except in the ordinary course of business on terms and conditions no less favourable to
                   the Borrower or any Subsidiary than could be obtained on an arm’s length basis from
                   unrelated third parties;

         (p)       permit Belvedere Finland to make any Distributions, except (i) as may be required in
                   order to meets the Borrower’s obligations under this Agreement or (ii) in order to provide
                   funding to the Borrower and/or Belvedere Fin Gold in order to maintain day-to-day
                   operations in the ordinary course of business, and subject to an aggregate limit of
                   €100,000 prior to Commercial Production and €250,000 thereafter;

         (q)       cause any Distributions permitted under paragraph (p) above made by Belvedere Finland
                   to Belvedere BV to be paid over to the Borrower as a Distribution;

         (r)       make any Distributions, other than payment of the June Redemption Obligation if no
                   Event of Default has occurred pursuant to Section 9.1(v), and other than scheduled
                   dividend payments to [Redacted – name] in accordance with the Settlement of
                   Guarantee if, on the date of any such scheduled dividend payment, (i) the Borrower has
                   maintained a Debt Service Coverage Ratio over the trailing 3 month period of not less
                   than 1.5:1 and (ii) no Event of Default has occurred and is continuing;

         (s)       and will not permit any of its Subsidiaries, to engage directly or indirectly in any other
                   business activity or acquire assets unrelated or unnecessary to its and their present
                   businesses;

         (t)       and will not permit any of its Subsidiaries, to enter into any new credit facilities with any
                   other lenders;

         (u)       make any payments of principal or interest on any indebtedness subordinated and
                   postponed behind the Lender, other than scheduled dividend payments to [Redacted –
                   name] in accordance with the Settlement of Guarantee, if, on the date of any such
                   scheduled dividend payment, (i) the Borrower has maintained a Debt Service Cover Ratio
                   over the trailing 3 month period of not less than 1.5:1 and (ii) no Event of Default has
                   occurred and is continuing;

         (v)       subject to an aggregate limit of €100,000 prior to Commercial Production and €250,000
                   thereafter, materially increase the Remuneration paid to senior management of the
                   Borrower and its Subsidiaries (for the purpose hereof “Remuneration” means any
                   payment by way of salary, bonus, management fees, dividends, repayment of shareholder
                   loans and any other benefit, including but not limited to a vehicle allowances); and

         (w)       (i) make any changes to the Reserve Account or (ii) withdraw funds received in respect
                   of grants from the Reserve Account except in order to fund a working capital shortfall in




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                                                       - 26 -


                   connection with (A) the operation of the Mine or (B) any Obligations owing to the
                   Lender.

                                                   ARTICLE X
                                                    DEFAULT

10.1     Events of Default

         Each of the following events shall constitute an Event of Default:

         (a)       default in payment of any principal, interest, fees or other amounts payable by the
                   Borrower or any of its Subsidiaries to the Lender;

         (b)       the Borrower grants security to [Redacted – name] in connection with the [Redacted-
                   name] Guarantee;

         (c)       the Borrower or any Subsidiary does not observe or perform any covenant or obligation
                   contained herein or in any other Credit Document to which it is a party in any material
                   respect (not otherwise specifically dealt with in this Section 10.1) and such breach or
                   omission, if capable of remedy, shall continue unremedied for more than ten (10)
                   Business Days after the earlier of a Responsible Officer having knowledge of the breach
                   or omission or the Borrower or Subsidiary receiving written notice from the Lender of
                   such breach or omission;

         (d)       any one or more of the Borrower and its Subsidiaries shall:

                   (i)       become insolvent, or generally not pay its debts or meet its liabilities as the same
                             become due, or suspend or threaten to suspend the conduct of its business, or
                             admit in writing its inability to pay its debts generally, or declare any general
                             moratorium on payment of its indebtedness or interest thereon, or propose a
                             compromise or arrangement between it and any of its creditors;

                   (ii)      make an assignment of its Property for the general benefit of its creditors whether
                             or not under the Bankruptcy and Insolvency Act (Canada), or any other
                             application legislation in any other jurisdiction, or make a proposal (or file a
                             notice of its intention to do so) whether or not under such Act;

                   (iii)     institute any proceeding seeking to adjudicate it an insolvent, or seeking
                             liquidation, dissolution, winding-up, reorganization, administration, compromise,
                             arrangement, adjustment, protection, moratorium, relief, stay of proceedings of
                             creditors generally (or any class of creditors), or composition of it or its debts
                             under any other statute, rule or regulation relating to bankruptcy, winding-up,
                             insolvency, reorganization, administration, plans of arrangement, relief or
                             protection of debtors (including, without limitation, under the Bankruptcy and
                             Insolvency Act (Canada), the Companies’ Creditors Arrangement Act (Canada)
                             and any applicable Business Corporations Act or Company Act);

                   (iv)      apply for the appointment of, or the taking of possession by, a receiver, interim
                             receiver, administrative receiver, receiver/manager, custodian, administrator,
                             trustee, liquidator or other similar official for it or any material part of their
                             Property; or



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                                                       - 27 -


                   (v)       take any overt action to approve, consent to or authorize any of the actions
                             described in this paragraph (c) or in paragraph (d) below;

         (e)       if any petition shall be filed, application made or other proceeding instituted by a third
                   party against or in respect of the Borrower or any one of its Subsidiaries:

                   (i)       seeking to adjudicate it an insolvent, or seeking a declaration that an act of
                             bankruptcy has occurred;

                   (ii)      seeking a receiving order against it including under the Bankruptcy and
                             Insolvency Act (Canada) or any other application legislation in any other
                             jurisdiction;

                   (iii)     seeking liquidation, dissolution, winding-up, reorganization, administration,
                             compromise, arrangement, adjustment, protection, moratorium, relief, stay of
                             proceedings of creditors generally (or any class of creditors), or composition of it
                             or its debts under any statute, rule or regulation relating to bankruptcy, winding-
                             up, insolvency, reorganization, administration, plans of arrangement, relief or
                             protection of debtors (including, without limitation, under the Bankruptcy and
                             Insolvency Act (Canada), the Companies’ Creditors Arrangement Act (Canada)
                             and any applicable Business Corporations Act or Company Act); or

                   (iv)      seeking the entry of an order for relief or the appointment of a receiver, interim
                             receiver, administrative receiver, receiver/manager, custodian, administrator,
                             trustee, liquidator or other similar official for it or any material part of its
                             Property,

                   and such petition, application or proceeding shall continue undismissed, or unstayed and
                   in effect, for a period of 10 days after the institution thereof, provided that if an order,
                   decree or judgment which is not stayed has been granted (whether or not entered or
                   subject to appeal) against the Borrower or any of its Subsidiaries thereunder in the
                   interim, such grace period shall cease to apply;

         (f)       if any material provision of any Credit Document shall at any time cease to be in full
                   force and effect, be declared to be void or voidable or shall be repudiated, or the validity
                   or enforceability thereof shall at any time be contested by the Borrower or any of its
                   Subsidiaries, or the Borrower or any of its Subsidiaries shall deny that it has any or any
                   further liability or obligation thereunder;

         (g)       there is, in the opinion of the Lender, acting reasonably, an event or circumstance with
                   respect to the Borrower or any Subsidiary which would reasonably be expected to have a
                   Material Adverse Effect;

         (h)       there is a material breach of any of the representations and warranties given by the
                   Borrower or any Subsidiary herein or in any other Credit Document;

         (i)       if the Lender has not received evidence satisfactory to the Lender that the Security set out
                   in Section 6.1(a) and (e) has, within 30 days from the date of this Agreement, been
                   registered with the appropriate Governmental Authority;

         (j)       without the prior consent of the Lender, there is a Change In Control;



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                                                       - 28 -


         (k)       if, measured against the Mine Plan on a monthly basis, over 2 consecutive months from
                   January 1, 2011:

                   (i)       the operating costs of production at the Mine exceed 120% of budget when
                             determined on a cost per ton basis;

                   (ii)       the ore grade processed through the plant falls below 85% of forecast grade; or

                   (iii)     the total mine production of Nickel in concentrate falls below 85% of forecast
                             production;

         (l)       if there is a default or other failure to perform obligations of the Borrower or its
                   Subsidiaries under any agreement to which the Borrower or such Subsidiary is a party or
                   which it is bound in an amount in excess of €50,000 and such default or other failure is
                   not waived by such third party or remedied within 3 Business Days of such default or
                   other failure or the expiry of any applicable grace period, which ever is later; or

         (m)       if there is a loss or Material Adverse Effect to any mining licence, permit or authorization
                   to which the Borrower or any of its Subsidiaries is a party which is material to its
                   business or operations; or

         (n)       if there is a breach, suspension or termination of the Offtake Agreement; or

         (o)       in the event that (A) any Governmental Authority, including, without limitation, the
                   Northern Finland Regional State Administrative Agency (Pohjois-Suomen
                   Aluehallintovirasto), requires additional bonding to be placed in respect of the
                   reclamation liabilities of Belvedere Finland or the Mine, and (B) there is insufficient cash
                   reserves to fund such bonding, the Borrower fails to raise additional funds through
                   issuing equity in order to satisfy those obligations on their due date.

10.2     Remedies

        Upon the occurrence of an Event of Default, all Obligations shall at the option of the Lender be
accelerated and become immediately due and payable and the Security shall become immediately
enforceable and the Lender may take such action or proceedings as the Lender in its sole discretion deems
expedient to enforce the same, all without any additional notice, presentment, demand, protest or other
formality, all of which are hereby expressly waived by the Borrower and its Subsidiaries.

10.3     Saving

         The Lender shall not be under any obligation to the Borrower or its Subsidiaries or any other
Person to realize any collateral or enforce the Security or any part thereof or to allow any collateral to be
sold, dealt with or otherwise disposed of. The Lender shall not be responsible or liable to the Borrower or
its Subsidiaries nor any other Person for any loss or damage upon the realization or enforcement of, the
failure to realize or enforce any collateral or any part thereof or the failure to allow any collateral to be
sold, dealt with or otherwise disposed of or for any act or omission on their respective parts or on the part
of any director, officer, agent, servant or adviser in connection with any of the foregoing, except that the
Lender will be responsible or liable for any loss or damage arising from the willful misconduct or gross
negligence of the Lender.




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                                                   - 29 -


10.4     Perform Obligations

         If the Borrower or any of its Subsidiaries has failed to perform any of its covenants or agreements
in the Credit Documents within the cure period, the Lender, may, but shall be under no obligation to
perform any such covenants or agreements in any manner deemed fit by the Lender without thereby
waiving any rights to enforce the Credit Documents. The reasonable expenses (including any legal costs)
paid by the Lender in respect of the foregoing shall be added to and become part of the Obligations and
shall be secured by the Security.

10.5     Third Parties

         No Person dealing with the Lender or any agent of the Lender shall be concerned to inquire
whether the Security has become enforceable, or whether the powers which the Lender is purporting to
exercise have been exercisable, or whether any Obligations remain outstanding upon the security thereof,
or as to the necessity or expediency of the stipulations and conditions subject to which any sale shall be
made, or otherwise as to the propriety or regularity of any sale or other disposition or any other dealing
with the collateral charged by such Security or any part thereof.

10.6     Remedies Cumulative

         The rights and remedies of the Lender under the Credit Documents are cumulative and are in
addition to and not in substitution for any rights or remedies provided by law. Any single or partial
exercise by the Lender of any right or remedy for a default or breach of any term, covenant, condition or
agreement herein contained shall not be deemed to be a waiver of or to alter, affect, or prejudice any other
right or remedy or other rights or remedies to which the Lender may be lawfully entitled for the same
default or breach. Any waiver by the Lender of the strict observance, performance or compliance with
any term, covenant, condition or agreement herein contained, and any indulgence granted by the Lender
shall be deemed not to be a waiver of any subsequent default.

10.7     Set-Off or Compensation

        In addition to and not in limitation of any rights now or hereafter granted under Applicable Law,
the Lender may at any time and from time to time without notice to the Borrower or its Subsidiaries or
any other Person, any notice being expressly waived by the Borrower and its Subsidiaries, set-off,
combine accounts and compensate and apply any and all deposits, general or special, time or demand,
provisional or final, matured or unmatured, in any currency, and any other indebtedness at any time
owing by the Lender to or for the credit of or the account of the Borrower and its Subsidiaries, against and
on account of the Obligations notwithstanding that any of them are contingent or unmatured. When
applying a deposit or other amount owing to the Lender in a currency that is different than the currency of
the Obligations, the Lender will convert the deposit or other amount using the exchange rate in effect at
the time of such conversion.

                                               ARTICLE XI
                                        MISCELLANEOUS PROVISIONS

11.1     Headings and Table of Contents

         The headings of the Articles and Sections and the Table of Contents are inserted for convenience
of reference only and shall not affect the construction or interpretation of this Agreement.




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                                                   - 30 -


11.2     Accounting Terms

        Each accounting term used in this Agreement, unless otherwise defined herein, has the meaning
assigned to it under GAAP.

11.3     Capitalized Terms

        All capitalized terms used in any of the Credit Documents (other than this Agreement) which are
defined in this Agreement shall have the meaning defined herein unless otherwise defined in the other
document.

11.4     Severability

         Any provision of this Agreement which is or becomes prohibited or unenforceable in any relevant
jurisdiction shall not invalidate or impair the remaining provisions hereof which shall be deemed
severable from such prohibited or unenforceable provision and any such prohibition or unenforceability in
any such jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.
Should this Agreement fail to provide for any relevant matter, the validity, legality or enforceability of
this Agreement shall not hereby be affected.

11.5     Number and Gender

        Unless the context otherwise requires, words importing the singular number shall include the
plural and vice versa, words importing any gender include all genders and references to agreements and
other contractual instruments shall be deemed to include all present or future amendments, supplements,
restatements or replacements thereof or thereto.

11.6     Amendment, Supplement or Waiver

        No amendment, supplement or waiver of any provision of the Credit Documents, nor any consent
to any departure by the Borrower or any of its Subsidiaries therefrom, shall in any event be effective
unless it is in writing, makes express reference to the provision affected thereby and is signed by the
Lender and then such waiver or consent shall be effective only in the specific instance and for the specific
purpose for which given. No waiver or act or omission of the Lender shall extend to or be taken in any
manner whatsoever to affect any subsequent breach by the Borrower or any of its Subsidiaries of any
provision of the Credit Documents or the rights resulting therefrom.

11.7     Governing Law

        This Agreement shall be conclusively deemed to be a contract made under, and shall for all
purposes be governed by and construed in accordance with, the laws of the Province of British Columbia
and the laws of Canada applicable in British Columbia. Each party to this Agreement hereby irrevocably
and unconditionally attorns to the non-exclusive jurisdiction of the courts of British Columbia and all
courts competent to hear appeals therefrom.

11.8     This Agreement to Govern

        In the event of any conflict between the terms of this Agreement and the terms of any other Credit
Document, the provisions of this Agreement shall govern to the extent necessary to remove the conflict.
However, a conflict or inconsistency shall not be deemed to occur if one Credit Document provides for a
matter and another Credit Document does not.



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                                                    - 31 -


11.9     Permitted Encumbrances

         The designation of an Encumbrance as a Permitted Encumbrance is not, and shall not be deemed
to be, an acknowledgment by the Lender that the Encumbrance shall have priority over the Security.

11.10    Currency

        All payments made hereunder shall be made in the currency in respect of which the obligation
requiring such payment arose. Unless the context otherwise requires, all amounts expressed in this
Agreement in terms of money shall refer to Euros.

11.11    Judgment Currency

         If, for the purposes of obtaining judgment in any court in any jurisdiction with respect to this
Agreement or any other Credit Document, it becomes necessary to convert into a particular currency (the
“Judgment Currency”) any amount due under this Agreement or under any other Credit Document in
any currency other than the Judgment Currency (the “Currency Due”), then conversion shall be made at
the rate of exchange prevailing on the Business Day before the day on which judgment is given. For this
purpose “rate of exchange” means the rate at which the Lender is able, on the relevant date, to purchase
the Currency Due with the Judgment Currency in accordance with its normal practices. In the event that
there is a change in the rate of exchange prevailing between the Business Day before the day on which the
judgment is given and the date of receipt by the Lender of the amount due, the Borrower will, on the date
of receipt by the Lender, pay such additional amounts, if any, or be entitled to receive reimbursement of
such amount, if any, as may be necessary to ensure that the amount received by the Lender on such date is
the amount in the Judgment Currency which when converted at the rate of exchange prevailing on the
date of receipt by the Lender is the amount then due under this Agreement or such other Credit Document
in the Currency Due. If the amount of the Currency Due which the Lender is so able to purchase is less
than the amount of the Currency Due originally due to it, the Borrower shall indemnify and save the
Lender harmless from and against all loss or damage arising as a result of such deficiency. This
indemnity shall constitute an obligation separate and independent from the other obligations contained in
this Agreement and the other Credit Documents, shall give rise to a separate and independent cause of
action, shall apply irrespective of any indulgence granted by the Lender from time to time and shall
continue in full force and effect notwithstanding any judgment or order for a liquidated sum in respect of
an amount due under this Agreement or any other Credit Document or under any judgment or order.

11.12    Expenses and Indemnity

        All statements, reports, certificates, opinions, appraisals and other documents or information
required to be furnished to the Lender by the Borrower and its Subsidiaries under this Agreement shall be
supplied without cost to the Lender. The Borrower shall pay on demand all reasonable out of pocket
costs and expenses of the Lender (including, without limitation, reasonable fees and expenses of counsel
and professional advisors or consultants for the Lender), incurred in connection with (i) the preparation,
execution, delivery, administration, periodic review, modification or amendment of the Credit
Documents; (ii) any enforcement of the Credit Documents; (iii) obtaining advice as to its rights and
responsibilities in connection with the Loan and the Credit Documents; (iv) reviewing, inspecting and
appraising the collateral that is the subject of the Security in connection with the enforcement of its rights
under the Security; and (v) any other matters relating to the Loan. Such costs and expenses shall be
payable whether or not an Advance is made under this Agreement.

         The Borrower and its Subsidiaries shall indemnify the Lender against any liability, obligation,
loss or expense which it may sustain or incur as a consequence of (i) any representation or warranty made



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                                                   - 32 -


by the Borrower or any Subsidiary which was incorrect at the time it was made or deemed to have been
made, (ii) a default by the Borrower or any Subsidiary in the payment of any sum due from it, including,
but not limited to, all sums (whether in respect of principal, interest or any other amount) paid or payable
to lenders of funds borrowed by the Lender in order to fund the amount of any such unpaid amount to the
extent the Lender is not reimbursed pursuant to any other provisions of this Agreement, (iii) the failure of
the Borrower to complete an Advance or make any payment after notice therefore has been given under
this Agreement, and (iv) any other default by the Borrower or any Subsidiary under any Credit Document.
A certificate of the Lender as to the amount of any such loss or expense shall be prima facie evidence as
to the amount thereof, in the absence of manifest error.

         In addition, the Borrower and its Subsidiaries shall indemnify the Lender and its directors,
officers, employees and representatives (the “Indemnified Parties”) from and against any and all actions,
proceedings, claims, losses, damages, liabilities, expenses and obligations of any kind that may be
incurred by or asserted against any of them as a result of or in connection with the making of an Advance
hereunder and the Lender taking, holding and enforcing the Security, other than arising from the gross
negligence or willful misconduct of the Lender or any other Indemnified Party. Whenever any such claim
shall arise, the Indemnified Party shall promptly notify the Borrower of the claim and, when known, the
facts constituting the basis for such claim, and if known, the amount or an estimate of the amount of the
claim. The failure of an Indemnified Party to give notice of a claim promptly shall not adversely affect
the Indemnified Party’s rights to indemnity hereunder unless such failure adversely effects the Borrower’s
position in respect of such claim.

        The Agreements in this Section shall survive the termination of this Agreement and repayment of
the Obligations.

11.13    Manner of Payment and Taxes

         All payments to be made by the Borrower and its Subsidiaries pursuant to the Credit Documents
are to be made without set-off, compensation or counterclaim, free and clear of and without deduction for
or on account of any Tax, including but not limited to withholding taxes, except for Taxes on the overall
net income of the Lender (such taxes applicable to the overall net income of the Lender are herein
referred to as “Excluded Taxes”). If any Tax, other than Excluded Taxes, is deducted or withheld from
any payments under the Credit Documents, the Borrower shall promptly remit to the Lender in the
currency in which such payment was made, the equivalent of the amount of Tax so deducted or withheld
together with the relevant receipt addressed to the Lender. If the Borrower is prevented by operation of
law or otherwise from paying, causing to be paid or remitting such Tax, the interest or other amount
payable under the Credit Documents will be increased to such rates as are necessary to yield and remit to
the Lender the principal sum advanced or made available together with interest at the rates specified in
the Credit Documents after provision for payment of such Tax. If following the making of any payment
by the Borrower under this Section 11.13, the Lender is granted a credit against or refund in respect of
any Tax payable by it in respect of such Taxes to which such payment by the Borrower relates that the
Lender would not have received had the Borrower not made the payment, the Lender shall (subject to the
Borrower having paid the relevant amount) to the extent that it is satisfied that it can do so without
prejudice to the retention of the amount of such credit or refund, reimburse the Borrower such amount as
the Lender shall certify to be the proportion of such credit or refund as will leave the Lender, after such
reimbursement in no worse or better position than it would have been in if the relevant Taxes had not
been imposed, or the relevant Taxes had not been deducted or withheld in respect of the payment by the
Borrower as aforesaid. The Lender shall, at the Borrower’s request and cost, file such documentation and
do such commercially reasonably things as may be necessary to obtain such credit or refund, but the
Lender shall not be obligated to disclose any information to the Borrower or any other Person concerning
its income or taxes that is not otherwise publicly available.


50723836.550723836-Convertible Loan Agreement
                                                   - 33 -


         If the Borrower makes any payment under this Section for the account of the Lender, the Lender
shall take reasonable steps to minimize the net amount payable by such Borrower under this Section, but
the Lender shall not be obliged to disclose any information to the Borrower concerning its income or
taxes that is not otherwise publicly available.

11.14    Increased Costs

         If the introduction of or change in or in the interpretation of, or any change in its application to
the Borrower of, any law or any regulation or guideline from any central bank or other governmental
authority (whether or not having the force of law), including but not limited to any reserve or special
deposit requirement or any Tax (other than Excluded Taxes) or exemption from any tax or any capital
requirement, has due to the compliance by the Lender therewith the effect, directly or indirectly, of
(i) increasing the cost to the Lender of performing its obligations hereunder; (ii) reducing any amount
received or receivable by the Lender hereunder or its effective return hereunder or on its capital; or
(iii) causing the Lender to make any payment or to forego any return based on any amount received or
receivable by the Lender hereunder, then upon demand from time to time the Borrower shall pay such
amount as shall compensate the Lender for any such cost, reduction, payment or foregone return that is
not fully offset by an increase in the applicable interest rate or rates or fees hereunder (collectively, the
“Additional Compensation”); provided however, the Lender shall not be entitled to Additional
Compensation, to the extent that such increase in costs or reduction in amounts received or receivable or
reduction in return is in respect of any period greater than 180 days prior to the delivery of notice thereof
to the Borrower (unless the relevant change, request or directive is retroactive in effect). Any certificate
of the Lender in respect of the foregoing will be prima facie evidence of the foregoing, except for
manifest error, provided that the Lender determines the amounts owing to it in good faith using any
reasonable averaging and attribution methods and provides a reasonably detailed description of its
calculation of the amounts owing to it. The Lender shall use reasonable commercial efforts to minimize
any and all increased costs contemplated by this Section 11.14.

11.15    Address for Notice

         Notice to be given under the Credit Documents shall, except as otherwise specifically provided,
be in writing addressed to the party for whom it is intended and, unless the law deems a particular notice
to be received earlier, a notice shall not be deemed received until actual receipt by the other party of an
original of such notice or a facsimile thereof if sent by facsimile transmission. The addresses of the
parties hereto for the purposes hereof shall be the addresses specified beside their respective signatures to
this Agreement, or such other mailing or facsimile addresses as each party from to time may notify the
other as aforesaid.

11.16    Time of the Essence

         Time shall be of the essence in this Agreement.

11.17    Further Assurances

        The Borrower and its Subsidiaries shall, at the request of the Lender do all such further acts and
execute and deliver all such further documents as may, in the reasonable opinion of the Lender, be
necessary or desirable in order to fully perform and carry out the purpose and intent of the Credit
Documents.




50723836.550723836-Convertible Loan Agreement
                                                  - 34 -


11.18    Term of Agreement

      Except as otherwise provided herein, this Agreement shall remain in full force and effect until the
payment and performance in full of all of the Obligations and the termination of this Agreement.

11.19    Payments on Business Day

        Whenever any payment or performance under the Credit Documents would otherwise be due on a
day other than a Business Day, such payment shall be made on the following Business Day.

11.20    Interest Act Equivalent

          In this Agreement, each rate of interest which is calculated with reference to a period (the
“deemed interest period”) that is less than the actual number of days in the calendar year of calculation
is, for the purposes of the Interest Act (Canada), equivalent to a rate based on a calendar year calculated
by multiplying such rate of interest by the actual number of days in the calendar year of calculation and
dividing by the number of days in the deemed interest period.

11.21    Maximum Rate Permitted by Law

         No interest or fee to be paid hereunder shall be paid at a rate exceeding the maximum rate
permitted by Applicable Law. In the event any such interest or fee exceeds such maximum rate, such
interest or fee shall be reduced or refunded, as the case may be, so as to be payable at the highest rate
recoverable under Applicable Law.

11.22    Successors and Assigns

        The Credit Documents shall be binding upon and enure to the benefit of the Lender, the Borrower
and its Subsidiaries and their heirs, estate trustees, personal and legal representatives, successors and
assigns, except that the Borrower and its Subsidiaries shall not assign any rights or obligations with
respect to this Agreement or any of the other Credit Documents without the prior written consent of the
Lender in its sole discretion.

11.23    Non-Merger

         The Borrower and its Subsidiaries covenant and agree with the Lender that, in the case of any
judicial or other proceeding to enforce the rights and remedies of the Lender under the Credit Documents
(or any part thereof), judgment may be rendered against the Borrower and its Subsidiaries in favour of the
Lender, for any amount owing by them under the Credit Documents (or for which the Borrower and its
Subsidiaries may be liable thereunder after the application to the payment thereof of the proceeds of any
sale of any of the property, assets or undertaking of the Borrower and its Subsidiaries).

11.24    Counterparts and Facsimile

        This Agreement may be executed in any number of counterparts, each of which when executed
and delivered shall be deemed to be an original, and such counterparts together shall constitute one and
the same agreement. For the purposes of this Section, the delivery of a facsimile or email copy of an
executed counterpart of this Agreement shall be deemed to be valid execution and delivery of this
Agreement, but the party delivering a facsimile copy shall deliver an original copy of this Agreement as
soon as possible after delivering the facsimile copy.




50723836.550723836-Convertible Loan Agreement
                                                - 35 -


11.25    Entire Agreement

        This Agreement constitutes the entire agreement between the parties hereto concerning the
matters addressed in this Agreement, and cancel and supersede any prior agreements, undertakings,
declarations or representations, written or verbal, in respect thereof.




50723836.550723836-Convertible Loan Agreement
                                                - 36 -


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



Address for Notice                                  BELVEDERE RESOURCES LTD., as Borrower
Suite 404-999 Canada Place
Vancouver, BC
V6C 3E2                                             By:   Signed

Attention:
Facsimile:                                          By:


Address for Notice                                  INVESTEC BANK plc, as Lender
[Redacted - address]

Attention: [Redacted – position]                    By:   Signed
Facsimile: [Redacted – number]

                                                    By:   Signed




50723836.550723836-Convertible Loan Agreement
                                          SCHEDULE A



There are currently 7,250,000 options outstanding. The option holders are: David Pym, Toby Strauss,
John Thomson, Steven Cuthill and [Redacted – name].




50723836.5
                            SCHEDULE B – DRAWDOWN NOTICE


From: Belvedere Resources Ltd.

To:      Investec Bank plc, Loans Administration and Transaction Management



Dated: **

Dear Sirs

Belvedere Resources Ltd. – €2,000,000 Credit Facility dated **                            (the
Agreement)

We refer to the Agreement. This is a Drawdown Notice. Terms defined in the Agreement have the same
meaning in this Drawdown Notice unless given a different meaning in this Drawdown Notice.

We wish to draw an Advance on the following terms:

         Proposed drawdown date:         [**                  ] (or, if that is not a Business Day, the next
                                         Business Day)

         Amount:                         €[**             ]

The Advance will have an Interest Period of [1, 2 or 3 months] commencing on _____________.

We confirm that each condition specified in Article 7 is satisfied on the date of this Drawdown Notice.

The proceeds of this Advance should be credited to the following account:

         Account Name

         Account Number

         SWIFT:

         Bank:

This Drawdown Notice is irrevocable.

Yours faithfully

…………………………………

authorised signatory for
Belvedere Resources Ltd.




50723836.5                                                                                       Lib2:180931.2

				
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