Rob gets a great deal at $.48 with half warrant:

Under the terms of the agreement in principle, Rob McEwen will invest$5 million in the combined company by way of private placement of10,416,667 common shares at
.48 per share plus, for each common sharepurchased in the private placement, a two-year half-warrant, with eachfull warrant exercise price of $1.00. After completion of the Plan ofArrangement and private placement, Mr. McEwen will personally ownapproximately 28% of the combined company's outstanding shares and 30%on a partially diluted basis assuming exercise of the warrants.

The following table illustrates on a pro-forma basis, the sharestructure of the combined company after giving effect to the proposedtransaction and Mr. McEwen's private placement:

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VG Gold common shares outstanding                                180,378,727
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Shares issuable in exchange for Lexam common shares (+)          101,848,503
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Shares of VG Gold owned by Lexam to be cancelled (-)            (75,000,000)
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Shares issued to Rob McEwen in $5 million private placement (+)   10,416,667
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Pro-forma common shares outstanding                              217,643,897
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VG Gold warrants outstanding                                       5,340,750
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VG Gold options outstanding                                        4,325,000
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VG Gold warrants to Rob McEwen in $5 million private placement     5,208,333
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Lexam options converted into VG Gold options                         525,000
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Pro-Forma fully diluted shares                                   233,042,980