Common use of Back-In Right Clause in Contracts

Back-In Right. Upon the Triggering Event, TIL and MAS shall have the right to acquire a total additional 15% Carried Interest in the Monterde Project for an amount equal to the lesser of 22.5% of the total exploration and development costs (including the costs of carrying out a feasibility study) incurred since the Effective Date on the Monterde Project or US$168,750 (herein called the "Back-In Right Fee"). Of the additional 15% Carried Interest TIL shall have the right to acquire a 3% Carried Interest under this section for a price equal to the lesser of 4.5% of the total exploration and development costs incurred since the Effective Date or US$33,750 and MAS shall have the right to acquire a 12% Carried Interest under this section for a price equal to the lesser of 18% of the total exploration and development costs incurred since the Effective Date or US$135,000. The total exploration and development costs incurred by KRI shall be determined at the time the Triggering Event occurs and shall be included in a notice of the Triggering Event which shall be given by KRI to the Developers forthwith after the occurrence of the Triggering Event. The Developers shall have the right to exercise their Back-In Right by paying the Back-In Right Fee in full for a period of sixty (60) days following notice from KRI of the Triggering Event. Each of the Developers shall provide notice to the other and to KRI within 45 days following receipt of the Triggering Event notice from KRI if it intends to exercise its Back-In Right and failing such notice a Developer who has given notice of its election to exercise its Back-In Right shall be entitled to the Back-In Right of the non-electing Developer and may exercise the Back-In Right with respect to the non-electing Developers percentage in accordance with the terms and conditions presented to the non-electing Developer. The Developers shall maintain at all times the right to immediately accelerate their Back-in Right by giving notice to KRI of such decision and submitting payment in the amount of $168,750. The Developers shall only have the right to accelerate their Back-in Right for the entire 15% Carried Interest. The Parties acknowledge and agree that in the case of any sale, transfer or joint venture of an interest in the Monterde Project Properties by KRI that the Developers shall have the prior right of consultation and review with KRI regarding the terms and conditions of such sale or joint venture. KRI acknowledges that it shall act in the best interest of all the shareholders and the Developers regarding any sale, transfer or joint venture of any of the Monterde Project Properties. Moreover, in the case of a sale or transfer of an interest greater than 50% pursuant to Section 1.1(c), the Developers' Back-in Right shall be exercisable by the Developers prior to said sale or transfer. The Developers shall also have immediate access to all technical, financial and business data of KRI upon the occurrence of a Triggering Event within seven (7) days of the Triggering Event. The Parties acknowledge and agree that upon the exercise of the Back-in Right the additional Carried Interest shall be forthwith converted to a corresponding equity interest in the outstanding shares of KRI.