NORTHERN SPIRIT RESOURCES INC.

NOTICE OF ANNUAL AND SPECIAL MEETING

AND

MANAGEMENT PROXY CIRCULAR

WITH RESPECT TO THE

ANNUAL AND SPECIAL MEETING OF SHAREHOLDERS

TO BE HELD ON JUNE 11, 2015

MANAGEMENT PROXY CIRCULAR DATED APRIL 30, 2015

The TSX Venture Exchange has not in any way passed upon the merits of the information contained herein and any representation to the contrary is an offence.

NORTHERN SPIRIT RESOURCES INC.

NOTICE OF ANNUAL AND SPECIAL MEETING OF SHAREHOLDERS TO BE HELD JUNE 11, 2015

TO THE HOLDERS OF COMMON SHARES

Notice is hereby given that an Annual and Special Meeting (the " Meeting ") of the holders of common shares (" Common Shares ") of Northern Spirit Resources Inc. (" Northern Spirit " or the " Corporation ") will be held at the offices of Burnet, Duckworth & Palmer, 2400, 525 – 8^th Avenue S.W., Calgary, Alberta on June 11, 2015 at 10:00 a.m. (Calgary time) for the following purposes:

1. to receive and consider the financial statements of the Corporation for the year ended December 31, 2014 and the auditors' reports thereon;

2. to fix the number of directors to be elected at the Meeting at six (6) members;

3. to consider and, if thought appropriate, to pass an ordinary resolution electing six (6) directors of the Corporation, all as more particularly described in the accompanying information circular - management proxy statement of the Corporation dated April 30, 2015 (the " Information Circular ");

4. to consider and, if thought appropriate, to pass an ordinary resolution appointing the auditors of the Corporation and authorizing the directors to fix their remuneration as such;

5. to consider and if thought appropriate, to pass, with or without variation, an ordinary resolution approving the Corporation's share option plan, all as more particularly described in the accompanying Information Circular; and

6. to transact such further and other business as may properly come before the Meeting or any adjournment or adjournments thereof.

The nature of the business to be transacted at the Meeting and the specific details of the matters proposed to be put to the Meeting are described in further detail in the accompanying Information Circular.

The record date for the determination of shareholders entitled to receive notice of and to vote at the Meeting is April 30, 2015 (the " Record Date "). Shareholders of Northern Spirit whose names have been entered in the register of shareholders at the close of business on that date will be entitled to receive notice of and vote at the Meeting, provided that, to the extent a shareholder transfers the ownership of any of his shares after such date and the transferee of those shares establishes that he owns the shares and requests, not later than 10 days before the Meeting, to be included in the list of shareholders eligible to vote at the Meeting, such transferee will be entitled to vote those shares at the Meeting.

A shareholder may attend the Meeting in person or may be represented by proxy. Shareholders who are unable to attend the Meeting or any adjournment thereof in person are requested to date, sign and return the accompanying form of proxy for use at the Meeting or any adjournment thereof. To be effective, the enclosed proxy must be mailed so as to reach or be deposited with the President and Chief Executive Officer of Northern Spirit c/o the Corporation's registrar and transfer agent, Valiant Trust Company, Suite 310, 606 – 4^th Street S.W., Calgary, Alberta T2P 1T1 or by fax at (403) 233-2857, not later than forty-eight (48) hours (excluding Saturdays, Sundays and statutory holidays in the Province of Alberta) prior to the time set for the Meeting or any adjournment thereof.

The instrument appointing a proxy shall be in writing and shall be executed by the shareholder or his attorney authorized in writing or, if the shareholder is a corporation, under its corporate seal by an officer or attorney thereof duly authorized.

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The persons named in the enclosed form of proxy are directors and/or officers of Northern Spirit. Each shareholder has the right to appoint a proxyholder other than such persons, who need not be a shareholder, to attend and to act for such shareholder and on such shareholder's behalf at the Meeting. To exercise such right, the names of the nominees of management should be crossed out and the name of the shareholder's appointee should be legibly printed in the blank space provided.

In the event of a strike, lockout or other work stoppage involving postal employees, all documents required to be delivered by a Northern Spirit shareholder should be delivered by facsimile to Valiant Trust Company of Canada at (403) 233-2857.

DATED at Calgary, Alberta this 30^th day of April, 2015.

BY ORDER OF THE BOARD OF DIRECTORS

(signed) "Kevin R. Baker" Kevin R. Baker, Q.C. President, Chief Executive Officer and a Director

NORTHERN SPIRIT RESOURCES INC.

INFORMATION CIRCULAR - MANAGEMENT PROXY STATEMENT

for the Annual and Special Meeting of Shareholders to be held June 11, 2015

INTRODUCTION AND GENERAL PROXY INFORMATION

Solicitation of Proxies

This Information Circular - Management Proxy Statement (the " Information Circular ") is furnished in connection with the solicitation of proxies by the management of Northern Spirit Resources Inc. (the " Corporation " or " Northern Spirit ") for use at the annual and special meeting of the holders (" Shareholders ") of common shares (the " Common Shares ") of the Corporation (the " Meeting ") to be held at the offices of Burnet, Duckworth & Palmer LLP, 2400, 525 – 8^th Avenue S.W., Calgary, Alberta on June 11, 2015 at 10:00 a.m. (Calgary time), and at any adjournment thereof, for the purposes set forth in the Notice of Annual and Special Meeting.

Unless otherwise stated, the information contained in this Information Circular is given as at April 30, 2015.

No person has been authorized by Northern Spirit to give any information or make any representations in connection with the transactions herein described other than those contained in this Information Circular and, if given or made, any such information or representation must not be relied upon as having been authorized by Northern Spirit.

Each outstanding Common Share is entitled to one vote on each resolution voted on at the Meeting. The Board of Directors of Northern Spirit (the " Board of Directors " or the " Board ") has fixed the record date for the Meeting at the close of business on April 30, 2015 (the " Record Date "). Northern Spirit will prepare, as of the Record Date, a list of Shareholders entitled to receive the Notice of Annual and Special Meeting and showing the number of Common Shares held by each such Shareholder. Each Shareholder named in the list is entitled to vote the Common Shares shown opposite such Shareholder's name at the Meeting except to the extent that such holder transfers ownership of the Common Shares after the Record Date, in which case the transferee shall be entitled to vote such Common Shares upon establishing ownership and requesting, by 4:30 p.m. (Calgary time) not later than 10 days before the Meeting, to be included in the list of Shareholders entitled to vote at the Meeting.

A quorum for the transaction of business at the Meeting shall be present if two Shareholders holding in the aggregate five percent (5%) of the Common Shares entitled to vote at the Meeting are present in person or represented by proxy.

Appointment of Proxies

Those Shareholders who desire to be represented at the Meeting by proxy must deposit their proxy with the President and Chief Executive Officer c/o the Corporation's registrar and transfer agent, Valiant Trust Company, Suite 310, 606 – 4^th Street S.W., Calgary, Alberta T2P 1T1 or by fax at (403) 233-2857, not later than 48 hours (excluding Saturdays, Sundays and holidays) before the day of the Meeting, or adjournment or adjournments thereof. A proxy must be executed by the Shareholder or his attorney authorized in writing, or if the Shareholder is a corporation, under its seal by an officer or attorney thereof duly authorized.

The persons named in the accompanying proxy are directors and officers of Northern Spirit. A Shareholder has the right to appoint a person (who need not be a Shareholder) to attend and act on such Shareholder's behalf at the Meeting other than the persons named in the proxy. To exercise this right, the Shareholder must strike out the name of the persons named in the proxy and insert the name of his or her nominee in the space provided or complete another appropriate form of proxy and, in either case, deposit the proxy with Northern Spirit at the place and within the time specified above for the deposit of proxies.

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Persons Making the Solicitation

The solicitation is made on behalf of the management of Northern Spirit. The costs incurred in the preparation and mailing of the Instrument of Proxy, Notice of Annual and Special Meeting and this Information Circular will be borne by Northern Spirit. In addition to solicitation by mail, proxies may be solicited by personal interviews, telephone or by other means of communication and by directors and officers of Northern Spirit, who will not be specifically remunerated therefor. While no arrangements have been made to date by Northern Spirit, Northern Spirit may contract for the distribution and solicitation of proxies for the Meeting. The costs incurred by Northern Spirit in soliciting proxies will be paid by Northern Spirit.

Exercise of Discretion by Proxy

The Common Shares represented by the Instrument of Proxy enclosed with this Notice of Annual and Special Meeting and this Information Circular will be voted for or against in accordance with the instructions of the Shareholder, but if no specification is made, they will be voted in favour of the matters set forth in the proxy. If any amendments or variations are proposed at the Meeting or any adjournment thereof to matters set forth in the proxy and described in the accompanying Notice of Annual and Special Meeting and this Information Circular, or if any other matters properly come before the Meeting or any adjournment thereof, the proxy confers upon the Shareholder's nominee discretionary authority to vote on such amendments or variations or such other matters according to the best judgment of the person voting the proxy at the Meeting. At the date of this Information Circular, management of Northern Spirit knows of no such amendments or variations or other matters to come before the Meeting.

Revocation of Proxies

A Shareholder who has given a proxy has the power to revoke it. If a person who has given a proxy attends personally at the Meeting at which the proxy is to be voted, such person may revoke the proxy and vote in person. In addition to revocation in any other manner permitted by law, a proxy may be revoked by an instrument in writing signed by the Shareholder or his attorney authorized in writing, or, if the Shareholder is a corporation, under its corporate seal and signed by a duly authorized officer or attorney for the corporation, and deposited at the registered office of Northern Spirit at any time up to and including the last day (other than Saturdays, Sundays and holidays) preceding the day of the Meeting at which the proxy is to be used, or any adjournment or adjournments thereof, or with the chairman of the Meeting on the day of the Meeting, or on the day of any adjournment thereof, prior to the commencement of the Meeting.

Advice to Beneficial Holders of Securities

The information set forth in this section is provided to beneficial holders of Common Shares who do not hold their Common Shares in their own name (" Beneficial Shareholders "). Beneficial Shareholders should note that only proxies deposited by Shareholders whose names appear on the records of the Corporation as the registered holders of shares can be recognized and acted upon at the Meeting. If shares are listed in an account statement provided to a Beneficial Shareholder by a broker, then in almost all cases those shares will not be registered in the Beneficial Shareholder's name on the records of the Corporation. Such shares will more likely be registered under the name of the Beneficial Shareholder's broker or an agent of that broker. In Canada, the vast majority of such shares are registered under the name of CDS & Co. (the registration name for CDS Clearing and Depository Services Inc., which acts as nominees for many Canadian brokerage firms). Shares held by brokers or their nominees can only be voted (for or against resolutions) upon the instructions of the Beneficial Shareholder. Without specific instructions, the broker/nominees are prohibited from voting shares for their clients. The Corporation does not know for whose benefit the shares registered in the name of CDS & Co. are held.

Applicable regulatory policy requires intermediaries/brokers to seek voting instructions from Beneficial Shareholders in advance of shareholders' meetings. Every intermediary/broker has its own mailing procedures and provides its own return instructions, which should be carefully followed by Beneficial Shareholders in order to ensure that their shares are voted at the Meeting. The majority of brokers now delegate responsibility for obtaining instructions from clients to Broadridge Financial Solutions, Inc. (" Broadridge "). Broadridge typically provides a scannable voting request form or applies a special sticker to the proxy forms, mails those forms to the Beneficial

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Shareholders and asks Beneficial Shareholders to return the voting request forms or proxy forms to Broadridge. Often Beneficial Shareholders are alternatively provided with a toll-free telephone number to vote their shares or website address where shares can be voted. Broadridge then tabulates the results of all instructions received and provides appropriate instructions respecting the voting of shares to be represented at the Meeting. A Beneficial Shareholder receiving a voting instruction request or a proxy with a Broadridge sticker on it cannot use that instruction request or proxy to vote Common Shares directly at the Meeting as the proxy must be returned as directed by Broadridge well in advance of the Meeting in order to have the shares voted. Accordingly, it is strongly suggested that Beneficial Shareholders return their completed instructions or proxies as directed by Broadridge well in advance of the Meeting.

This Information Circular and accompanying materials are being sent to both registered Shareholders and Beneficial Shareholders. The Corporation does not send proxy-related materials directly to Beneficial Shareholders and is not relying on the notice-and-access provisions of securities laws for delivery to either registered or Beneficial Shareholders. The Corporation will deliver proxy-related materials to nominees, custodians and fiduciaries and they will be asked to promptly forward them to Beneficial Shareholders. If you are a Beneficial Shareholder your nominee should send you a voting instruction form or proxy form along with this Information Circular - Proxy Statement. The Corporation has elected to pay for the delivery of our proxy-related materials to objecting Beneficial Shareholders.

Although a Beneficial Shareholder may not be recognized directly at the Meeting for the purposes of voting Common Shares registered in the name of his or her broker (or agent of the broker), a Beneficial Shareholder may attend at the Meeting as proxyholder for the registered Shareholder and vote Common Shares in that capacity. Beneficial Shareholders who wish to attend the Meeting and indirectly vote their Common Shares as proxyholder for the registered Shareholder should enter their own names in the blank space on the form of proxy provided to them and return the same to their broker (or the broker's agent) in accordance with the instructions provided by such broker (or agent), well in advance of the Meeting.

VOTING SECURITIES AND PRINCIPAL HOLDERS OF VOTING SECURITIES

The authorized share capital of the Corporation consists of an unlimited number of Common Shares and an unlimited number of preferred shares, issuable in series. As at April 30, 2015, there were 351,683,993 Common Shares issued and outstanding. The Common Shares are the only issued and outstanding voting securities of the Corporation and the holders thereof are entitled to one vote for each Common Share held.

To the knowledge of the directors and senior officers of the Corporation, as at the date hereof, no person or company beneficially owned or controlled or directed, directly or indirectly, voting securities of the Corporation carrying more than 10% of the voting rights attached to any class of voting securities of the Corporation other than as set forth below.

Note:

(1) Includes 3,600,000 Common Shares beneficially owned by Fidens Capital Corporation, a company controlled by Mr. Baker.

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RECEIPT OF THE FINANCIAL STATEMENTS AND AUDITORS' REPORT

At the Meeting, Shareholders will receive and consider the financial statements of the Corporation for the year ended December 31, 2014 and the auditors' report thereon. No formal action is required or proposed to be taken at the Meeting with respect to the financial statements.

FIXING NUMBER OF DIRECTORS

At the Meeting, it is proposed that the number of directors to be elected at the Meeting to hold office until the next annual general meeting of the Corporation or until their successors are elected or appointed, subject to the articles of incorporation or by-laws of the Corporation, be set at six (6). There are presently six (6) directors of Northern Spirit, each of whom will retire from office at the Meeting. Unless otherwise directed, it is the intention of management to vote proxies in the accompanying form in favour of setting the number of directors to be elected at the Meeting at six (6).

ELECTION OF DIRECTORS

Unless otherwise directed, it is the intention of management to vote proxies in the accompanying form in favour of the election as directors for the ensuing year the six (6) nominees hereinafter set forth:

Kevin R. Baker R. Bruce Allford Patrick G. Bell Robert G. Jennings Sheldon B. Kasper Paul Cheung

The names and provinces and countries of residence of the persons nominated for election as directors, the number of Common Shares beneficially owned, directly or indirectly, or over which each exercises control or direction, the period served as a director and the principal occupation during the last five years of each are as follows:

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Notes:

(1) Member of the Corporation's Audit Committee.

• (2) Member of the Corporation's Reserves Committee.

• (3) Member of the Corporation's Corporate Governance, Compensation and Compliance Committee.

(4) Includes 3,600,000 Common Shares beneficially owned by Fidens Capital Corporation, a company controlled by Mr. Baker.

(5) Includes 1,631,159 Common Shares beneficially owned by Ghost Mountain Energy Corporation, a company controlled by Mr. Kasper.

(6) Includes 3,000,000 Common Shares owned by companies controlled by Mr. Cheung.

The information as to Common Shares beneficially owned, directly or indirectly, or over which control or direction is exercised, is based upon the information furnished to Northern Spirit by the respective nominees. As at the date hereof, the directors and officers of the Corporation, and their associates and affiliates, as a group, own or control, directly or indirectly, 114,406,546 Common Shares or 32.5% of the issued and outstanding Common Shares.

Majority Voting for Directors

The Board has adopted a majority voting policy stipulating that if the votes in favour of the election of a director nominee at a Shareholders' meeting represent less than a majority of the Common Shares voted and withheld, the nominee will submit his resignation promptly after the meeting, for the Board's consideration. The Board's decision to accept or reject the resignation offer will be disclosed to the public within 90 days of the applicable Shareholders' meeting. The nominee will not participate in any Board deliberations on the resignation offer unless there are not at least three directors who did not receive a majority withheld vote. The policy does not apply in circumstances involving contested director elections.

Cease Trade Orders, Bankruptcies, Penalties or Sanctions

To the knowledge of the directors, no proposed director of the Corporation (nor any personal holding company of any such persons):

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• (a) is, as at the date of this Information Circular, or has been, within ten years before the date of this Information Circular, a director, chief executive officer or chief financial officer of any company, that:

• (i) was subject to a cease trade order (including a management cease trade order), an order similar to a cease trade order or an order that denied the relevant company access to any exemption under securities legislation, in each case that was in effect for a period of more than 30 consecutive days (collectively, an " Order ") that was issued while the proposed director was acting in the capacity as director, chief executive officer or chief financial officer; or

• (ii) was subject to an Order that was issued after the proposed director ceased to be a director, chief executive officer or chief financial officer and which resulted from an event that occurred while that person was acting in the capacity as director, chief executive officer or chief financial officer;

• (b) is, as at the date of this Information Circular, or has been, within ten years before the date of this Information Circular, a director or executive officer of any company that, while that person was acting in that capacity, or within a year of that person ceasing to act in that capacity, became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold its assets; or

• (c) has, within the ten years before the date of this Information Circular, become bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or become subject to or instituted any proceedings, arrangement or compromise with creditors, or had a receiver, receiver manager or trustee appointed to hold the assets of the proposed director.

In addition, no proposed director of the Company has been subject to: (i) any penalties or sanctions imposed by a court relating to securities legislation or by a securities regulatory authority or has entered into a settlement agreement with a securities regulatory authority; or (ii) any other penalties or sanctions imposed by a court or regulatory body that would likely be considered important to a reasonable securityholder in deciding whether to vote for a proposed director.

STATEMENT OF EXECUTIVE COMPENSATION

On August 26, 2013, the Board established a Corporate Governance, Compensation and Compliance Committee (the " Compensation Committee ") of the Board consisting of Robert Jennings, Bruce Allford and Patrick Bell. The Compensation Committee's mandate includes reviewing and making recommendations to the Board in respect of compensation matters relating to our executive officers, employees and directors. The members of the Compensation Committee are "independent" for the purposes of National Instrument 58-201 - Corporate Governance Guidelines . For a description of the relevant education and experience of each member of the Compensation Committee that enables such member to make decisions on the suitability of Northern Spirit's compensation policies and practice, refer to the applicable biographies under the headings " Election of Directors " and " Audit Committee Information – Relevant Education and Experience ".

The Compensation Committee's mandate includes reviewing and making recommendations to the Board in respect of compensation matters relating to our executive officers, employees and directors, including the named executive officers (as defined below) which are identified in the " Summary Compensation Table " below. Without limiting the generality of the foregoing, the Compensation Committee has the following duties:

• (a) to review the compensation philosophy and remuneration policy for employees of Northern Spirit and to recommend to the Board changes to improve Northern Spirit's ability to recruit, retain and motivate employees;

• (b) to review and recommend to the Board the retainer and fees to be paid to members of the Board;

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• (c) to review and approve corporate goals and objectives relevant to the compensation of the Chief Executive Officer (" CEO "), evaluate the CEO's performance in light of those corporate goals and objectives, and determine (or make recommendations to the Board with respect to) the CEO's compensation level based on such evaluation;

• (d) to recommend to the Board with respect to non-CEO officer and director compensation including to review management's recommendations for proposed share option or share purchase plans and other incentivecompensation plans and equity-based plans for non-CEO officer and director compensation and make recommendations in respect thereof to the Board;

• (e) to administer the Option Plan and any other equity incentive plan(s) approved by the Board in accordance with its terms including recommending the grants of stock options or awards in accordance with the terms thereof;

• (f) to determine and recommend for approval of the Board bonuses to be paid to officers and employees of Northern Spirit and its subsidiaries, as applicable, and to establish targets or criteria for the payment of such bonuses, if appropriate; and

• (g) to prepare and submit a report of the Compensation Committee for approval of the Board and inclusion of annual disclosure required by applicable securities laws to be made by Northern Spirit including the this –

• Statement of Executive Compensation required to be included in the information circular proxy statement of Northern Spirit and review other executive compensation disclosure before Northern Spirit publicly discloses such information.

The Compensation Committee is required to be comprised of at least three directors, or such greater number as the Board may determine from time to time. The majority of the members of the Compensation Committee are required to be independent; as such term is defined for this purpose under applicable securities requirements. Pursuant to the mandate of the Compensation Committee, meetings of the Compensation Committee are to take place at least one time per year.

Compensation Discussion and Analysis

Executive Compensation Principles

Northern Spirit's current compensation program is based on a "pay-for-performance" philosophy which supports Northern Spirit's objective of the successful exploration and development of its oil and natural gas properties. Our compensation policies are founded on the principle that compensation should be aligned with shareholders' interests, while also recognizing that Northern Spirit's corporate performance is dependent upon the retainment of highly trained, experienced and committed directors, executive officers and employees who have the necessary skill sets, education, experience and personal qualities required to manage our business. Our program also recognizes that the various components thereof must be sufficiently flexible to adapt to unexpected developments in the technology industry and the impact of internal and market-related occurrences from time to time.

Our executive compensation program is comprised of the following principal components: (a) base salary; (b) shortterm incentive compensation comprised of discretionary cash bonuses; and (c) long-term incentive compensation comprised of share options. See " Incentive Plans ". Together, these components support our long-term growth strategy and are designed to address the following key objectives of our compensation program:

• align executive compensation with shareholders' interests;

• attract and retain highly qualified management;

• focus performance by linking incentive compensation to the achievement of business objectives and financial and operational results; and

• encourage retention of key executives for leadership succession.

The aggregate value of these principal components and related benefits, is used as a basis for assessing the overall competiveness of Northern Spirit's executive compensation package. When determining executive compensation, including the assessment of the competiveness of the Corporation's compensation program, the Board of Directors reviews the compensation practices of companies in its selected peer group. These companies compete with

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Northern Spirit for executive talent, operate in a similar business environment and are of similar size, scope and complexity.

In establishing our executive compensation program, the Board of Directors also considers the implication of the risks associated with our compensation program, including:

• The risk of executives taking inappropriate or excessive risks.

• The risk of inappropriate focus on achieving short term goals at the expense of long term return to shareholders.

• The risk of encouraging aggressive accounting practices.

• The risk of excessive focus on financial returns and operational goals at the expense of regulatory, environmental and health and safety.

While no program can fully mitigate these risks we believe that many of these risks are mitigated by:

• Weighting our long term incentives towards share ownership and vesting our long term incentives over a number of years.

• Establishing a uniform incentive programs for all executive officers and employees.

• Avoiding narrowly focused performance goals which may encourage loss of focus on providing long term shareholder return and retaining adequate discretion to insure that the Board of Directors retain their business judgment in assessing actual performance.

• Establishing a strong "tone at the top" for accounting, regulatory, environmental and health and safety compliance.

The Corporation's compensation program is primarily designed to reward performance and, accordingly, the performance of both the Corporation, as well as the individual performance of executive officers during the year in question, are examined by the Board in conjunction with setting executive compensation packages. The Board does not set specific performance objectives in assessing the performance of the Chief Executive Officer and other executive officers; rather the Board of Directors uses its experience and judgment in determining an overall compensation package for the Chief Executive Officer and other executive officers.

Elements of our Executive Compensation Program

Base Salaries

The base salary component is intended to provide a fixed level of pay that reflects each executive officer's primary duties and responsibilities. It also provides a foundation upon which performance based incentive compensation elements are assessed and established. The Corporation intends to pay base salaries to its executive officers, including the Chief Executive Officer, that are competitive within the lower to mid-range for similar positions within its selected peer group. In contrast to much of the peer group, Northern Spirit has an extremely small management team, demanding each of the officers carry additional workload. At start-up, executive officers' base salaries were set at modest levels, on both a comparative and absolute basis, reflective of the early stage of development of the Corporation.

Short-Term Incentive Compensation - Cash Bonuses

In addition to base salaries, the Corporation has a discretionary bonus plan pursuant to which the Board of Directors may award annual cash bonuses to executive officers and employees. The annual cash bonus element of the executive compensation program is structured to drive and reward current year results. It is the Board of Director's philosophy that an individual bonus should be tied primarily to that individual's contribution to achieving corporate goals.

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– Long Term Incentive Compensation Stock Options

Executive officers, along with all of Northern Spirit's officers, directors, employees, contractors and other service providers, are eligible to participate in the Corporation's share option plan (the " Option Plan "). The Option Plan and the Common Shares reserved thereunder have been approved by Northern Spirit's shareholders. The Option Plan promotes an ownership perspective among executives, encourages the retention of key executives and provides an incentive to enhance shareholder value by furthering Northern Spirit's growth and profitably. As with most companies in the Corporation's peer group, Options form an integral component of the total compensation package provided to the Corporation's executive officers. Participation in the Option Plan rewards overall corporate performance, as measured through the price of the Corporation's Common Shares. In addition, the Option Plan enables executives to develop and maintain a significant ownership position in the Corporation.

Options are normally awarded by the Board upon the commencement of an individual's employment with the Corporation based on the level of responsibility within the Corporation. Additional grants may be made periodically to ensure that the number of Options granted to any particular individual is commensurate with the individual's level of ongoing responsibility within the Corporation. In considering additional grants, we evaluate the number of Options an individual has been granted, the exercise price and value of the Options and the term remaining on those Options. Generally, all employees, officers and directors are eligible for an annual award of options. In addition, the Corporation periodically grants additional options to employees and officers in lieu of base salary increases. See " Incentive Plans – Share Option Plan " for a description of the detailed terms of our Option Plan.

Summary

The Corporation's compensation policies have allowed the Corporation to attract and retain a team of motivated professionals and support staff working towards the common goal of enhancing shareholder value. The Board of Northern Spirit will continue to review compensation policies to ensure that they are competitive within the oil and natural gas industry and consistent with the performance of the Corporation.

Summary Compensation Table

The following table sets forth, for the years ended December 31, 2014, 2013 and 2012 information concerning the compensation paid to our CEO, Chief Financial Officer (" CFO ") and the most highly compensated executive officers (or the most highly compensated individual acting in a similar capacity), other than the CEO and CFO, at the end of such years whose total compensation was more than $150,000 (each a " Named Executive Officer " or " NEO " and collectively, the " Named Executive Officers " or " NEOs ").

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Notes:

• (1) Reflects Options issued under the Option Plan. Based on the grant date fair value of the applicable awards. The grant date fair value for compensation purposes is calculated using Black-Scholes Option pricing methodology. Key assumptions used in the pricing model for 2012 were: dividend yield: nil; expected volatility: 79.5%; risk-free interest rate: 1.11% and weighted average life: 5.0 years. No Options were issued to NEO's during the years ended December 31, 2014 and December 31, 2013.

• (2) Reflects the cash amounts awarded to the NEO under the Corporation's cash bonus plan. (3) The value of perquisites received by each of the NEOs, including property or other personal benefits provided to the NEOs that are not generally available to all employees, were not in the aggregate greater than $50,000 or 10% of the Named Executive Officer's total salary for the financial year.

• (4) Represents fees paid to a corporation controlled by Mr. Baker. (5) Represents fees paid to a corporation controlled by Mr. Kasper.

Incentive Plans

Share Option Plan

The Corporation has an Option Plan which permits the granting of options (" Options ") to purchase Common Shares to directors, officers, employees, consultants and other service providers (" Optionees ") of the Corporation and its subsidiaries. The Option Plan is intended to afford persons who provide services to Northern Spirit an opportunity to obtain an increased proprietary interest in Northern Spirit by permitting them to purchase Common Shares and to aid in attracting as well as retaining and encouraging the continued involvement of such persons with Northern Spirit. The Option Plan is administered by the Board of Directors of the Corporation or a Committee of the Board of Directors appointed from time to time by the Board to administer the Option Plan (the Board of Directors or, if appointed, such Committee, is referred to as the " Committee ").

The Option Plan currently limits the number of Common Shares that may be issued on exercise of Options to a number not exceeding 10% of the number of Common Shares which are outstanding from time to time. Options that are cancelled, terminated or expired prior to exercise of all or a portion thereof shall result in the Common Shares that were reserved for issuance thereunder being available for a subsequent grant of Options pursuant to the Option Plan. As the Option Plan is a "rolling" plan, the issuance of additional Common Shares by the Corporation or the exercise of Options will also give rise to additional availability under the Option Plan.

The exercise price of the Options granted pursuant to the Option Plan is determined by the Committee at the time of grant, provided that the exercise price shall not be less than the discounted market price (as determined in accordance with the rules of the TSX Venture Exchange (the " TSXV ")) of the Common Shares on the day preceding the date of grant.

The policies of the TSXV require that the Option Plan be approved every year by Shareholders. The Option Plan was last approved by Shareholders at our last annual and special meeting held on December 4, 2014.

Annual Incentive Plan

The Corporation has established a discretionary cash bonus plan for its executive officers and employees based and dependent upon, among other things, the performance of both the Corporation and the individual for the applicable period. The amount of any cash bonus awarded is not set in relation to any formula or specific criteria but is the result of a subjective determination of both the Corporation's and the individual's performance by the Board of – Directors based upon the recommendations of the Board of Directors. See " Statement of Executive Compensation Elements of our Executive Compensation Program Short-Term Incentive Compensation - Cash Bonuses ".

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Incentive Plan Awards

Outstanding Share-Based Awards and Option-based Awards

The Corporation did not have any share-based awards outstanding at the end of the most recently completed financial year.

Options are normally recommended by the Corporation's management and approved by the Board of Directors upon the commencement of employment with the Corporation based on the level of responsibility within the Corporation. Additional grants may be made periodically, generally on an annual basis, to ensure that the number of options granted to any particular individual is commensurate with the individual's level of ongoing responsibility within the Corporation. When determining Options to be allocated to eligible participants, a number of factors are considered including the number of outstanding Options held by such individual, the value of such Options and the total number of available Options for grant.

The following table sets forth for each Named Executive Officer all option-based awards outstanding at the end of the year ended December 31, 2014.

Note:

(1) Calculated based on the difference between the market price of the Common Shares on December 31, 2014 and the exercise price of the Options.

Incentive Plan Awards – Value Vested or Earned During the Year

The following table sets forth for each Named Executive Officer, the value of option-based awards which vested during the year ended December, 2014 and the value of non-equity incentive plan compensation earned during the year ended December 31, 2014. The Corporation did not have any share-based awards outstanding at the end of the most recently completed financial year.

Notes:

(1) Calculated based on the difference between the market price of the Common Shares underlying the Option on the vesting date and the exercise price of the Options.

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• (2) Reflects the cash bonus earned by the NEO in respect of the last completed financial year.

Pension Plan Benefits, Termination of Employment, Change in Responsibilities and Employment Contracts

There are no pension plan benefits or employment contracts between the Corporation and the Named Executive Officers. There are no compensatory plans, contracts or arrangements with the Named Executive Officers (including payments to be received from the Corporation or any subsidiary), which result or will result from the resignation, retirement or any other termination of employment of such Named Executive Officers or from a change of control of the Corporation or any subsidiary thereof or any change in such Named Executive Officers' responsibilities following a change in control.

Compensation of Directors

During the year ended December 31, 2014, Northern Spirit did not pay any fees to its directors. Directors may be reimbursed for out-of-pocket expenses incurred in carrying out their duties as directors. Each of the nonmanagement directors also participate in the Option Plan.

Directors' Summary Compensation Table

The following table sets forth for the year ended December 31, 2014, information concerning the compensation paid to our directors other than directors who are also Named Executive Officers.

Note: (1) No Options were issued during the year ended December 31, 2014 under the Option Plan.

Directors' Outstanding Option-Based Awards and Share-Based Awards

The following table sets forth for each of our directors other than directors who are also Named Executive Officers, all option-based awards outstanding at the end of the year ended December 31, 2014. The Corporation does not have any outstanding share-based awards.

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Note:

(1) Calculated based on the difference between the market price of the Common Shares underlying the Options on December 31, 2014 and the exercise price of the Options.

Directors' Incentive Plan Awards – Value Vested or Earned During the Year

The following table sets forth for each of our directors other than directors who are not also Named Executive Officers, the value of option-based awards which vested during the year ended December 31, 2014 and the value of non-equity incentive plan compensation earned during the year ended December 31, 2014. The Corporation does not have any share-based awards outstanding.

Note:

(1) Calculated based on the difference between the market price of the Common Shares underlying the Options on the vesting date and the exercise price of the Options on the vesting date.

Securities Authorized for Issuance Under Equity Compensation Plans

The following sets forth information in respect of securities authorized for issuance under our equity compensation plans (being the Option Plan) as at December 31, 2014.

Note:

(1) The Option Plan authorizes the issuance of Options entitling the holders to acquire, in the aggregate, up to 10% of the Common Shares from time to time. See " Incentive Plans – Share Option Plan ".

APPOINTMENT OF AUDITORS

Unless otherwise directed, it is management's intention to vote the proxies in favour of an ordinary resolution to appoint the firm of KPMG LLP, Chartered Accountants, of Calgary, Alberta, to serve as auditors of the Corporation until the next annual meeting of shareholders and to authorize the directors to fix their remuneration as such. KPMG LLP has served as independent auditors for the Corporation since October 16, 2013.

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AUDIT COMMITTEE INFORMATION

Audit Committee Mandate and Terms of Reference

The mandate and responsibilities of the audit committee (the " Mandate ") of the Corporation (the " Audit Committee ") of the Board of Directors is attached hereto as Schedule "A".

Composition of the Audit Committee

The members of the Audit Committee being Messrs. R. Bruce Allford, Patrick Bell and Robert Jennings, are – financially literate and Messrs. Bell and Jennings are independent in accordance with National Instrument 52-110 Audit Committees . Mr. Allford is not independent as he is a partner of Burnet, Duckworth & Palmer LLP, which firm provides legal services to the Corporation.

Relevant Education and Experience

The members of the Corporation's Audit Committee and each of their respective backgrounds and qualifications are listed below:

Mr. Allford is a securities lawyer and has a Bachelor of Commerce (Finance) degree. Mr. Allford is a director of several public and private companies and serves as an audit committee member on several of these boards.

Mr. Bell has been the President of Kamarata Holdings Ltd., a private investment company, since 1994. Additionally, Mr. Bell has been a director and the President of ConleyMax Inc., an oilfield service company, since November 2011. Mr. Bell was Vice President of Century Oilfield Services Inc. from 2005 to 2009.

Mr. Jennings received a Certified Financial Analyst designation from the University of Virginia in 1974 and maintains the designation with the Chartered Financial Analyst Institute. He has over 40 years investment banking and executive management experience in both the national and international marketplace. Currently Mr. Jennings is on the board of another publicly traded company.

Pre-Approval of Policies and Procedures

The Audit Committee shall review and pre-approve all non-audit services to be provided to Northern Spirit by its external auditors.

External Auditor Service Fees

The following table discloses fees billed to the Corporation for the last two fiscal years by the Corporation's independent auditors:

Notes:

(1) Aggregate fees billed in each of the last fiscal year for assurance related services by the Corporation's external auditors that are reasonably related to the performance of the audit or review of the Corporation's financial statements that are not reported under "Audit Fees".

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• (2) Aggregate fees billed in each of the last two fiscal years for professional services rendered by the Corporation's external auditors for tax return preparation.

• (3) Aggregate fees billed in each of the last two fiscal years for professional services rendered by the Corporation's external auditors for other fees.

Exemption

As the Corporation is listed on the Exchange, it is exempt from the requirements of Part 3 (Composition of the Audit Committee) and Part 5 (Reporting Obligations) of National Instrument 52-110 – Audit Committees and relies on the exemptions therein.

APPROVAL OF OPTION PLAN

Pursuant to TSXV Policy 4.4 (the " Option Policy "), the Corporation is permitted to maintain a "rolling" stock option plan reserving a maximum of 10% of the issued and outstanding Common Shares for issuance pursuant to stock options. In accordance with the Option Policy, rolling option plans must receive shareholder approval yearly at the Corporation's annual meeting.

Shareholders will therefore be asked at the Meeting to consider and, if thought advisable, to ratify and approve the Option Plan (the " Option Plan Resolution "), to provide for the reservation of a maximum of 10% of the issued and outstanding Common Shares. As of April 30, 2015, the Corporation has 15,100,000 outstanding Options to purchase Common Shares, at an exercise price of $0.10 and 15,500,000 outstanding Options to purchase Common Shares, at an exercise price of $0.05.

The Option Plan provides for the granting of Options to directors, officers, employees and consultants (as permitted by applicable law). The Option Plan is administered by the Board of Directors, or a committee of the Board of Directors appointed from time to time for such purpose. Options may be granted at the discretion of the Board of Directors or a committee thereof, in such number that may be determined at the time of grant, subject to the limits set out in the Option Plan. The number of Common Shares issuable upon exercise of the options granted under the Option Plan is not more than 10% of the number of Common Shares that are issued and outstanding. The number of Common Shares issuable upon the exercise of the Options granted to any one individual, within a one-year period, cannot exceed 5% of the number of Common Shares issued and outstanding.

The exercise price of options granted under the Option Plan will be fixed by the Board of Directors, or a committee thereof, at the time of grant, provided that such exercise price may not be less than the Discounted Market Price of the Common Shares, or such other prices as may be determined under the applicable rules and regulations of all regulatory authorities to which the Corporation is subject, including the Exchange. The options granted under the Option Plan will vest on a basis, and will be exercisable for a period not exceeding five years, as determined by the Board of Directors, or a committee thereof, at the time of grant. In the absence of any determination by the Board of Directors as to vesting, vesting shall be as to one third on the date of grant and one third on each of the second and third anniversaries of the date of grant.

The foregoing summary is subject to the specific provisions of the Option Plan.

Accordingly, at the Meeting, Shareholders will be asked to consider and, if thought fit, approve an ordinary resolution in the following form:

• "BE IT RESOLVED as an ordinary resolution of the shareholders (the

• " Shareholders )" of Northern Spirit Resources Inc. (the " Corporation "), that:

• the option plan (the " Option Plan ") of the Corporation, on the terms described in the accompanying information circular - management proxy statement of the Corporation dated April 30, 2015 be and the same is hereby ratified, confirmed and approved;

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1. any one director or officer of the Corporation be and is hereby authorized and directed to do all things and to execute and deliver all documents and instruments as may be necessary or desirable to carry out the terms of this resolution; and

2. notwithstanding that this resolution has been passed by the Shareholders, the re-approval of the proposed Option Plan is conditional upon receipt of final approval from the TSX Venture Exchange and the directors of the Corporation are hereby authorized and empowered to revoke this resolution, without any further approval of the Shareholders, at any time if such revocation is considered necessary or desirable by the directors."

It is the intention of management to vote the proxies in the accompanying form in favour of the Option Plan resolution .

CORPORATE GOVERNANCE DISCLOSURE

Set forth below is a description of the Corporation's current corporate governance practices, as prescribed by Form 58-101F2, which is attached to National Instrument 58-101 – Disclosure of Corporate Governance Practices . The requirements of Form 58-101F2 are set out below in italics:

1. Board of Directors

Disclose the identity of directors who are independent.

The Board of Directors of the Corporation has determined that the following four (4) directors of the Corporation are independent:

Patrick G. Bell Robert G. Jennings R. Bruce Allford Paul Cheung

Disclose the identity of directors who are not independent, and describe the basis for that determination.

Kevin Baker and Sheldon Kasper, current directors of the Corporation, are not independent as Messrs. Baker and Kasper are officers of the Corporation.

2. Directorships

If a director is presently a director of any other issuer that is a reporting issuer (or the equivalent) in a jurisdiction or a foreign jurisdiction, identify both the director and the other issuer.

The following current directors are presently directors of other issuers that are reporting issuers (or the equivalent):

Name of Director Names of Other Issuers R. Bruce Allford Yoho Resources Inc. Indo Pacific Resources Ltd. Kevin. R. Baker Calfrac Well Services Ltd. Robert G. Jennings TransGlobe Energy Corporation

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3. Orientation and Continuing Education

Briefly describe what measures the board takes to orient new directors and briefly describe what measures, if any, the board takes to provide continuing education for its directors.

Due to the size of the Board of Directors, no formal program currently exists for the orientation of new directors and existing directors provide orientation and education to new members on an informal and ad hoc basis. In addition, new directors of the Corporation will be given a copy of the mandate of each of the Board of Directors and each of the Audit Committee, Compensation Committee and Reserves Committee and a presentation will be made by management to new directors respecting the nature and operations of the Corporation's business.

No formal continuing education program currently exists for the directors of the Corporation; however, the Corporation encourages directors to attend, enrol or participate in courses and/or seminars dealing with financial literacy, corporate governance and related matters and has agreed to pay the cost of such courses and seminars. Each director of the Corporation has the responsibility for ensuring that he maintains the skill and knowledge necessary to meet his obligations as a director.

4. Ethical Business Conduct

Describe what steps the board takes to encourage and promote a culture of ethical business conduct.

The Board of Directors has adopted a code of ethics applicable to all members of the Corporation, including directors, officers and employees. Each director, officer and employee of the Corporation has been provided with a copy of the code of ethics.

The Board of Directors has also adopted a "Whistleblower Policy" wherein employees, consultants and external stakeholders of the Corporation are provided with a mechanism by which they can raise concerns in a confidential, anonymous process.

5. Nomination of Directors

Describe the process by which the board identifies new candidates for board nomination.

Pursuant to the mandate of the Board of Directors, the Board of Directors has responsibility for selecting nominees for election to the Board. At present, the Board of Directors does not have a process by which the Board identifies new candidates for Board nomination but rather the identification of new candidates is done on an informal and ad hoc basis.

6. Compensation

Describe the process by which the board determines the compensation for the issuer's directors and officers.

See compensation discussion above.

7. Other Board Committees

If the board has standing committees other than the audit, compensation and nominating committees, identify the committees and describe their function.

In addition to the Audit Committee, the Corporation also has a Reserves Committee of the Board of Directors to which the Board of Directors has delegated the responsibility for the following matters:

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• (i) reviewing the Corporation's procedures relating to the disclosure of information with respect to oil and gas activities including reviewing its procedures for complying with its disclosure requirements and restrictions set forth under applicable securities requirements;

• (ii) reviewing the Corporation's procedures for providing information to the independent evaluator;

• (iii) meeting, as considered necessary, with management and the independent evaluator to determine whether any restrictions placed by management affect the ability of the evaluator to report without reservation on the Reserves Data (as defined in National Instrument 51-101) (the " Reserves Data ") and to review the Reserves Data and the report of the independent evaluator thereon (if such report is provided);

• (iv) reviewing the appointment of the independent evaluator and, in the case of any proposed change to such independent evaluator, determining the reason therefor and whether there have been any disputes with management;

• (v) providing a recommendation to the Board of Directors as to whether to approve the content or filing of the statement of the Reserves Data and other information that may be prescribed by applicable securities requirements including any reports of the independent engineer and of management in connection therewith;

• (vi) reviewing the Corporation's procedures for reporting other information associated with oil and gas producing activities; and

• (vii) generally reviewing all matters relating to the preparation and public disclosure of estimates of the Corporation's reserves.

8. Assessments

Disclose what steps, if any, the board takes to satisfy itself that the board, its committees, and its individual directors are performing effectively.

As part of its mandate, the Board of Directors is responsible for reviewing annually the composition of the board and its committees and assessing the performance of the directors on an ongoing basis.

INDEBTEDNESS OF DIRECTORS AND EXECUTIVE OFFICERS

None of the directors and officers of the Corporation or the proposed directors of the Corporation, nor any of their associates or affiliates is now or has been indebted to the Corporation since incorporation, other than for routine indebtedness, nor is, or at any time since the beginning of the most recently completed financial year of the Corporation has, any indebtedness of any such person been the subject of a guarantee, support agreement, letter of credit or other similar arrangement or understanding provided by the Corporation.

INTERESTS OF INSIDERS AND OTHERS IN MATERIAL TRANSACTIONS

There are no material interests, direct or indirect, of directors and senior officers of Northern Spirit, nominees for director, any shareholder who beneficially owns more than 10% of the Common Shares of Northern Spirit, or any known associate or affiliate of such persons in any transactions since the commencement of Northern Spirit's last completed financial year (being the year ended December 31, 2014) or in any proposed transaction which has materially affected or would materially affect the Corporation.

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OTHER MATTERS

Management knows of no amendment, variation or other matter to come before the Meeting other than the matters referred to in the Notice of Annual and Special Meeting. However, if any other matter properly comes before the Meeting, the accompanying proxy will be voted on such matter in accordance with the best judgment of the person or persons voting the proxy.

ADDITIONAL INFORMATION

Additional information regarding Northern Spirit is available on SEDAR at www.sedar.com. In addition, securityholders may contact Northern Spirit directly to request copies of Northern Spirit's financial statements and management's discussion and analysis from Northern Spirit's head office at 850, 396 – 11^th Avenue SW Calgary, Alberta T2P 0C5.

SCHEDULE "A" TO THE INFORMATION CIRCULAR - MANAGEMENT PROXY STATEMENT OF NORTHERN SPIRIT RESOURCES INC.

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NORTHERN SPIRIT RESOURCES INC.

(the "Corporation" ) Audit Committe e of the Board of Directors (the "Committee" )

CHARTER

1. Purpose

The primary function of the Committee is to assist the Board of Directors (the " Board ") in fulfilling its oversight responsibilities by reviewing:

• (a) the financial information that will be provided to the shareholders and others;

• (b) the systems of internal controls and accounting policies that management and the Board have established; and

• (c) all audit processes.

Primary responsibility for the financial reporting, information systems, risk management and internal controls of the Corporation is vested in management and is overseen by the Board. Consistent with this function, the Committee should encourage continuous improvement of, and should foster adherence to, the Corporation's policies, procedures and practices at all levels. The Committee's primary duties and responsibilities are to:

• (a) Serve as an independent and objective party to monitor the Corporation's financial reporting process and the system of internal controls.

• (b) Monitor the independence and performance of the Corporation's external auditors.

• (c) Provide an open avenue of communication among the auditors, management and the Board.

• Composition and Process

• (a) The Committee shall be composed of such number of directors as may be required by applicable law and regulatory policy, such required number of whom shall be "independent" as that term is defined in National Instrument 52-110 – Audit Committees .

• (b) Members shall be appointed by the Board on an annual basis, shall serve one-year terms and may serve consecutive terms, which are encouraged to ensure continuity of experience.

• (c) The Chair of the Committee shall be appointed by the Board for a one-year term, and may serve any number of consecutive terms.

• (d) All members of the Committee shall be financially literate and at least one member of the Committee shall be a "financial expert". Financial literacy is the ability to read and understand a balance sheet, income statement and cash flow statement that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of the issues that can reasonably be expected to be raised by the Corporation's financial statements.

• (e) The Chair shall, in consultation with management and the external auditor and internal auditor (if any), establish the agenda for the meetings and ensure that properly prepared agenda materials are

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circulated to the members with sufficient time for study prior to the meeting. The external auditor will also receive notice of all meetings of the Committee. The Committee may employ a list of prepared questions and considerations as a portion of its review and assessment process.

• (f) The Committee shall endeavour to meet at least four times per year and may call additional meetings as required. A quorum at meetings of the Committee shall be a majority of its members. The Committee may hold its meetings, and members of the Committee may attend meetings, by telephone conference if this is deemed appropriate or make written resolutions which must be signed by all members of the Committee.

• (g) The Chair shall appoint a secretary to keep all minutes of Committee meetings, which secretary does not have to be a member of the Committee or a director.

• (h) The minutes of the Committee meetings shall accurately record the decisions reached and shall be distributed to Committee members with copies to the Board, the Chief Executive Officer, the Chief Financial Officer (or persons performing similar functions) and the external auditor.

• (i) The Committee reviews, prior to their presentation to the Board and their release, all material financial information required by securities regulations.

• (j) The Committee enquires about potential claims, assessments and other contingent liabilities.

• (k) The Committee periodically reviews with management, depreciation and amortization policies, loss provisions and other accounting policies for appropriateness and consistency.

3. Authority

• (a) The Committee is appointed by the Board pursuant to provisions of the Business Corporations Act (Alberta) and the bylaws of the Corporation.

• (b) Primary responsibility for the Corporation's financial reporting, accounting systems and internal controls is vested in senior management and is overseen by the Board. The Committee is a standing committee of the Board established to assist it in fulfilling its responsibilities in this regard. The Committee shall have responsibility for overseeing management reporting on internal controls. While it is management's responsibility to design and implement an effective system of internal control, it is the responsibility of the Committee to ensure that management has done so.

• (c) The Committee shall have unrestricted access to the Corporation's personnel and documents and will be provided with the resources necessary to carry out its responsibilities.

• (d) The Committee shall have direct communication channels with the internal auditors (if any) and the external auditors to discuss and review specific issues as appropriate.

• (e) The Committee shall have the sole authority to retain (or terminate) independent counsel, advisors or consultants as it determines necessary to assist the Committee in discharging its functions hereunder. The Committee shall be provided with the necessary funding to compensate the independent counsel, advisors or consultants retained by the Committee.

• Relationship with External Auditors

• (a) An external auditor must report directly to the Committee.

• (b) The Committee is directly responsible for overseeing the work of the external auditor engaged for the purpose of preparing or issuing an auditors' report or performing other audit, review or attest services for the issuer, including the resolution of disagreements between management and the external auditor regarding financial reporting.

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• (c) The Committee shall implement structures and procedures to ensure that it meets with the external auditor at least once annually in the absence of management.

• Accounting Systems, Internal Controls and Procedures

• (a) The Committee shall obtain reasonable assurance from discussions with and/or reports from management, and reports from external auditors that accounting systems are reliable and that the prescribed internal controls are operating effectively for the Corporation and its subsidiaries and affiliates.

• (b) The Committee shall review to ensure to its satisfaction that adequate procedures are in place for the review of the Corporation's disclosure of financial information extracted or derived from the Corporation's financial statements and will periodically assess the adequacy of those procedures.

• (c) The Committee shall review with the external auditor the quality and not just the acceptability of the Corporation's accounting principles and direct the external auditors' examinations to particular areas.

• (d) The Committee will review control weaknesses identified by the external auditors, together with management's response and review with external auditors their view of the qualifications and performance of the key financial and accounting executives.

• (e) In order to preserve the independence of the external auditor, the Committee will:

  • (i) recommend to the Board the external auditor to be nominated for the purpose of preparing or issuing an auditor's report or performing other audit, review or attest services for the Corporation;

  • (ii) recommend to the Board the compensation of the external auditor's engagement; and

  • (iii) review and pre-approve any engagements for non-audit services to be provided by the external auditors or its affiliates, together with estimated fees, and consider the impact, if any, on the independence of the external auditor.

• (f) The Committee will review with management and with the external auditor any proposed changes in major accounting policies, the presentation and impact of significant risks and uncertainties, and key estimates and judgments of management that may be material to financial reporting.

• (g) The Committee shall establish procedures for the receipt, retention and treatment of complaints received by the Corporation regarding accounting, internal accounting controls or auditing matters and the confidential anonymous submission by employees of the Corporation of concerns regarding questionable accounting or auditing matters.

• (h) The Committee shall establish a periodic review procedure to ensure that the external auditor complies with the Canadian Public Accountability Regime under Multilateral Instrument 52-108, Auditor Oversight.

• (i) The Committee shall review and approve the Corporation's hiring policies regarding partners, employees and former partners and employees of the present and former external auditor of the Corporation.

• Statutory and Regulatory Responsibilities

• (a) Annual Financial Information - review the annual audited financial statements, annual management's discussion and analysis ("MD&A") and related press releases and recommend their approval to the Board, after discussing matters such as the selection of accounting policies (and

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changes thereto), major accounting judgments, accruals and estimates with management and the external auditor.

• (b) Interim Financial Statements - review the quarterly interim financial statements, interim MD&A and recommend their approval to the Board.

• (c) Earnings Guidance/Forecasts - review any forecasted financial information and forward looking statements regarding forecasted financial information, if any.

• (d) In addition, the Committee must review the Corporation's press releases pertaining to the financial statements, MD&A and earnings updates, if any, before the Corporation publicly discloses this information.

• Reporting

• (a) The Committee will report, through the Chair of the Committee, to the Board following each meeting on the major discussions and decisions made by the Committee, and report annually to the Board on the Committee's responsibilities and how it has discharged them.

• (b) In addition, the Committee will review and reassess this Charter annually and recommended any proposed changes to the Board.

• Other Responsibilities

• (a) Investigating fraud, illegal acts or conflicts of interest.

• (b) Discussing selected issues with counsel or the outside auditor or management.