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Subscription Agreement

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Title:

Subscription Agreement

Entities:

Mcewen Robert Ross

Date:

2006

Size:

60KB total

Price:

$42

ID:

#2854606

► Securities ► Subscription Agreements

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SUBSCRIPTION AGREEMENT

(FIRST TRANCHE)

TO:	Robert R. McEwen

c/o 3^rd Floor

99 George Street

Toronto, ON M5A 2N4

Dear Sirs:

Re: Sale of Units

This subscription agreement is to confirm the agreement between the Subscriber (as hereinafter defined) and Minera Andes Inc. (the Corporation), subject to the terms and conditions set forth herein, whereby the Subscriber will subscribe for 15,414,740 Units (as hereinafter defined) from treasury of the Corporation at the price of $0.35 per Unit, with each Unit comprised of one (1) Unit Share (as hereinafter defined) and one-half of one (¹/₂) Warrant (as hereinafter defined), each whole Warrant being exercisable to acquire one (1) Common Share (as hereinafter defined) at a price of $0.55 at any time prior to the earlier of: (i) the 15^th trading day after receiving notice from the Corporation that the weighted-average price of the Common Shares on the Stock Exchange (as hereinafter defined) has been equal to or greater than $1.00 for a period of 20 consecutive trading days commencing 120 days after the date of issuance of the Warrants; and (ii) two (2) years from the Closing Date, subject to adjustment.

The Subscriber agrees to be bound by the terms and conditions set forth in this Agreement (as hereinafter defined), including without limitation, the representations, warranties and covenants set forth in this Agreement. The Subscriber further agrees, without limitation, that the Corporation may rely upon the Subscribers representations, warranties and covenants contained in this Agreement.

1.	Definitions

(a)

In this Agreement, unless the context otherwise requires:

(i)

Agreement means this subscription agreement as the same may be amended, supplemented or restated from time to time;

(ii)

Agreements in Default means, collectively, the agreements listed in Schedule C attached hereto;

(iii)

Business Day means a day on which Canadian chartered banks are open for the transaction of regular business in the City of Toronto, Ontario;

(iv)

Closing means the closing of the purchase and sale of the Purchased Units;

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(v)

Closing Date means December 20, 2005 or such other date as the Corporation and the Subscriber may mutually agree upon in writing;

(vi)

Common Shares means the common shares of the Corporation as constituted on the date hereof;

(vii)

Corporation means Minera Andes Inc., a corporation governed by the laws of the Governing Jurisdiction and includes any successor corporation thereto;

(viii)

Dollar or $ means a dollar of lawful money of Canada;

(ix)

Favourable Shareholder Consent means the approval by the shareholders of the Corporation (i) pursuant to the requirements of the Stock Exchange, of the closing of the purchase of Units by the Subscriber pursuant to the Second Tranche Subscription Agreement, and (ii) of the termination of the Shareholder Rights Plan and the redemption of all rights issued thereunder;

(x)

Governing Jurisdiction means the Province of Alberta;

(xi)

Information means all information that is, or has been, filed by the Corporation under the Securities Laws or with the Stock Exchange, and includes, but is not limited to, all of the documents filed by the Corporation on the System for Electronic Document Analysis and Retrieval (SEDAR);

(xii)

NI 45-106 means National Instrument 45-106 Prospectus and Registration Exemptions;

(xiii)

Person means an individual, a firm, a corporation, a syndicate, a partnership, a trust, an association, an unincorporated organization, a joint venture, an investment club, a government or an agency or political subdivision thereof and every other form of legal or business entity of whatsoever nature or kind;

(xiv)

Purchased Units means 15,414,740 Units purchased by the Subscriber;

(xv)

Reporting Jurisdictions means, collectively, the Provinces of British Columbia, Alberta, Saskatchewan, Ontario and Nova Scotia;

(xvi)

Second Tranche Subscription Agreement means the subscription agreement dated December 20, 2005 between the Corporation and the Subscriber whereby the Subscriber has subscribed to purchase 13,156,689 Units;

(xvii)

Securities Laws means the securities legislation and regulations of, and the instruments, policies, rules, orders, codes, notices and interpretation

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notes of the applicable securities regulatory authority or applicable securities regulatory authorities of, the applicable jurisdiction or jurisdictions collectively;

(xviii)

Shareholder Rights Plan means the shareholder rights plan of the Corporation dated as of June 23, 2005, as amended by an agreement dated as of October 5, 2005;

(xix)

Stock Exchange means the TSX Venture Exchange;

(xx)

Subject Shares means, collectively, the Unit Shares and the Warrant Shares;

(xxi)

Subscriber means Robert R. McEwen or any Person designated by Robert R. McEwen;

(xxii)

Subsidiary or Subsidiaries means the subsidiaries of the Corporation;

(xxiii)

Unit Purchase Price means $0.35 per Purchased Unit;

(xxiv)

Unit Shares means the Common Shares comprising part of the Units;

(xxv)

Units means the 15,414,740 units of the Corporation being sold by the Corporation, each unit being comprised of one (1) Common Share one-half of one (¹/₂) Warrant;

(xxvi)

Warrant Certificates means the certificates representing the Warrants;

(xxvii)

Warrant Shares means the Common Shares issuable upon the exercise of the Warrants; and

(xxviii)

Warrants means the warrants of the Corporation comprising part of the Units, each whole Warrant being exercisable to acquire one (1) Common Share at an exercise price of $0.55 per Warrant Share at any time prior to the earlier of: (i) the 15^th trading day after receiving notice from the Corporation that the weighted-average price of the Common Shares on the Stock Exchange has been equal to or greater than $1.00 for a period of 20 consecutive trading days commencing 120 days after the date of issuance of the Warrants, and (ii) two (2) years from the Closing Date, subject to adjustment.

2.	Conditions of Sale in favour of the Corporation

In connection with the purchase of the Purchased Units, the Subscriber shall, after the Closing, complete, sign as indicated and return to the Corporation any applicable documents required by the Stock Exchange.

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The obligation of the Corporation to sell the Purchased Units to the Subscriber is subject to the conditions that:

(a)

the Subscriber executes and returns all documents required by the Securities Laws and the policies of the Stock Exchange, including the forms set out in schedules attached hereto, as applicable, to the Corporation as the sale of the Purchased Units by the Corporation will not be qualified by a prospectus;

(b)

the representations and warranties made by the Subscriber herein are true and correct when made and are true and correct on the Closing Date with the same force and effect as if they had been made on and as of such date;

(c)

all covenants, agreements and conditions contained in this Agreement to be performed by the Subscriber on or prior to the Closing Date shall have been performed or complied with in all material respects; and

(d)

all necessary corporate and regulatory approvals being obtained prior to the Closing Date.

By signing and returning this Agreement to the Corporation, the Subscriber consents to the filing by the Corporation of all documents required by the Securities Laws and the policies of the Stock Exchange.

The Subscriber agrees to comply with all Securities Laws and with the policies of the Stock Exchange concerning the purchase of, the holding of, and the resale restrictions applicable to, the Purchased Units.

3.	Conditions of Purchase in favour of the Subscriber

The obligation of the Subscriber to purchase the Purchased Units from the Corporation is subject to the conditions that:

(a)

the Corporation executes and returns all documents required by the Securities Laws and the policies of the Stock Exchange, including the forms set out in schedules attached hereto, as applicable;

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