Common use of Covenants of Optionee Clause in Contracts

Covenants of Optionee. Optionee covenants and agrees with Optionor that so long as Optionee is the Operator of the exploration program on the Property: (a) It will maintain the Property in good standing and will pay all rentals, rates, duties, royalties, assessments, fees, taxes or other government charges levied with respect to the Property or Optionee’s operations thereon which shall fall due during the Term. Notwithstanding the forgoing, and in acknowledgement that record title of the Property shall remain in the name of Optionor until such time as exercise of the Option, Optionor shall cooperate with and assist Optionee with the preparation of documentation required for the payment of such rentals, rates, duties, royalties, assessments, fees, taxes or other government charges levied with respect to the Property or Optionee’s operation thereon which shall fall due during the Term. In the event that Optionor fails to cooperate with and assist Optionee with the preparation of documentation required for the payment of such rentals, rates, duties, royalties, assessments, fees, taxes or other government charges levied with respect to the Property or Optionee’s operation thereon which shall fall due during the Term, Optionor hereby grants Optionee the full power of attorney to make all such payments and take all actions necessary or prudent, in Optionee’s sole and absolute discretion, to preserve the property, and any such payments made as well any reasonable costs incurred by Optionee shall be deducted from any cash payments due Optionor pursuant to Section 3.2(a) hereunder; (b) It will carry out its operations on the Property in a careful and miner-like manner and in accordance with applicable laws and regulations of the State of Arizona; (c) It will properly pay all accounts of every nature and kind for wages, supplies, Workers’ Compensation Assessments, or the equivalent under Arizona law, income tax deductions, and all other accounts and indebtedness incurred by it so that no claim or lien arises thereon or upon the ore or minerals contained therein and it will indemnify Optionor and save them harmless from any and all loss, costs, actions, suits, damages or claims which may be made against Optionor in respect of the operations on the Property, provided however, that Optionee shall have the right to contest the validity of any such lien or claim of lien; (d) Upon termination of this Agreement, it will leave the Property in a safe condition in accordance with the applicable regulatory requirements; (e) It will at all times maintain and keep true and correct records of all production and the disposition thereof and of all costs and expenditures incurred as well as all other data necessary or proper for the settlement of accounts between the parties hereto in connection with their rights and obligations under this Agreement; (f) It will obtain all necessary environmental permits prior to commencing operations on the Property and it will be responsible for any environmental assessments made by the governmental bodies as a result of operations on the Property; and (g) It will indemnify and save harmless Optionor from any and all liability arising in relation to the Property including, but not limited to, any liability from environmental damage during the Term, unless such liability was caused by the fault of Optionor, or either of them, or their directors, officers, employees, agents or consultants.

Covenants of Optionee. 11.1 At the signing of this Agreement or as soon as possible thereafter, the Optionee covenants will provide the Optionors a Quitclaim Deed and agrees with Optionor that so long a Declaration of Value, in forms reasonably acceptable to the Optionors, which are to be held in trust by the lawyers for the Optionors, on commercially reasonable terms reasonably acceptable to the Optionee, and released as Optionee is the Operator of the exploration program on the Propertyfollows: (a) It to the Optionors in the event that the Option is terminated, in which case the Optionors may record the documents against the title to the Property; and (b) to the Optionee upon the exercise of the Option. 11.2 Further, this Agreement provides for the possibility of additional mining claims becoming subject to the Option in this Agreement and also the right of the Optionee to abandon some mining claims subject to the Option, in certain circumstances. As a result, the list of mining claims, at any time in the future, may be different from the list of mining claims as of the date of this Agreement. Therefore, the Optionee agrees that should the list of mining claims vary from the list of mining claims presently set out in this Agreement (which is also the same list in the current Quitclaim Deed), then as soon as the list of mining claims changes, the Optionee will maintain complete and have duly executed a further Quitclaim Deed and a further Declaration of Value and will immediately deliver that Quitclaim Deed and Declaration of Value to the lawyers for the Optionors to be held in trust pursuant to Section 11.1 and the Optionors will cause the previous unused Quitclaim Deed and Declaration of Value to be marked as void and then will deliver the voided Quitclaim Deed and Declaration of Value to the lawyers for the Optionee. 11.3 Following the signing of this Agreement, the Optionee will: (a) in addition to and not in substitution for the obligations to keep the Property in good standing as set forth elsewhere in this Agreement, keep the Property in good standing for a period of one year following the date of the termination or exercise of the Option; (b) keep the Property free and clear of all liens, charges and encumbrances arising from its operations hereunder during the term of the Option and then for a period of six years following the date of the termination or exercise of the Option; (c) in the event that the laws in the State of Nevada or the federal laws of the United States of America allow or require the filing of assessment reports, then from time to time, file all exploration work as assessment work against the Property to the maximum allowable extent; (d) subject to Section 11.3(c), the Optionee will file, as assessment work against each of the mining claims then forming the Property, all exploration expenses to the maximum amount allowable and will pay use its best efforts to ensure that the applicable government authority accepts all rentalsof those expenditures as assessment and the Optionee will ensure that the assessment work is credited to each of the mining claims then forming the Property; (e) permit the Optionors, ratesor their representatives duly authorized by it in writing, dutiesat its own risk and expense, royaltiesaccess to the Property at all reasonable times; (f) permit the Optionors, assessmentsor their representatives duly authorized by it in writing, feesaccess to all records pertaining to the Property, taxes including those prepared by the Optionee and those prepared by other people both before and after the date of this Agreement, in respect to the Property (or other government charges levied any Mining Tenure whether it is partially or wholly in the Area of Interest regardless of whether the Area of Interest Option was exercised) or work done on or with respect to the Property (or Optionee’s operations thereon which shall fall due during any Mining Tenure whether it is partially or wholly in the Term. Notwithstanding Area of Interest regardless of whether the forgoingArea of Interest Option was exercised), including, but not restricted to, all drill core, assay pulps, maps, drilling logs, assay results and in acknowledgement that record title other technical data acquired by the Optionee or compiled by or on behalf of the Property shall remain in the name of Optionor until such time as exercise of the Option, Optionor shall cooperate with and assist Optionee with the preparation of documentation required for the payment of such rentals, rates, duties, royalties, assessments, fees, taxes or other government charges levied with respect to the Property (or Optionee’s operation thereon which shall fall due during any Mining Tenure, whether it is partially or wholly in the Term. In Area of Interest Additional Property regardless of whether the event that Optionor fails Area of Interest Option was exercised), including any interpretive data or conclusions and copies of all books, accounts and records of operations conducted by or on behalf of the Optionee on the Property (or any Mining Tenure whether it is partially or wholly in the Area of Interest regardless of whether the Area of Interest Option was exercised) or by others on the Property (or any Mining Tenure whether it is partially or wholly in the Area of Interest regardless of whether the Area of Interest Option was exercised); (g) without demand from the Optionors, deliver to cooperate with and assist the Optionors, as soon as possible after receipt by the Optionee with the preparation of documentation required for the payment of such rentalsthereof, rates, duties, royalties, assessments, fees, taxes all documents referred to in Section 11.3(f); (h) conduct all work on or other government charges levied with respect to the Property or Optionee’s operation thereon which shall fall due during the Term, Optionor hereby grants Optionee the full power of attorney to make all such payments and take all actions necessary or prudent, in Optionee’s sole and absolute discretion, to preserve the property, and any such payments made as well any reasonable costs incurred by Optionee shall be deducted from any cash payments due Optionor pursuant to Section 3.2(a) hereunder; (b) It will carry out its operations on the Property in a careful and miner-like minerlike manner and in accordance compliance with all applicable laws Federal, Provincial and regulations of the State of Arizonalocal laws, rules, orders and regulations; (ci) It will properly pay all accounts of every nature not breach any Environmental Laws; (j) not do anything to incur Environmental Liabilities; (k) indemnify and kind for wages, supplies, Workers’ Compensation Assessments, or hold the equivalent under Arizona law, income tax deductions, and all other accounts and indebtedness incurred by it so that no claim or lien arises thereon or upon the ore or minerals contained therein and it will indemnify Optionor and save them Optionors harmless from and against any and all lossexpenses, costslosses, claims, actions, damages or liabilities, whether joint or several (including the aggregate amount paid in reasonable settlement of any actions, suits, damages proceedings or claims which claims), and the reasonable fees and expenses of its counsel that result from a breach of any term of this Agreement or may be incurred in advising with respect to and/or defending any claim that may be made against Optionor the Optionors, to which the Optionors may become subject or otherwise involved in any capacity under any statute or common law or otherwise insofar as such expenses, losses, claims, damages, liabilities or actions arise out of or are based, directly or indirectly, (i) any taxes, fees or other amounts owing to any governmental agency in respect of the operations Property and (ii) any work conducted on the PropertyProperty by the Optionee or its employees, provided howevercontractors or agents and including, that Optionee shall have the right to contest the validity but not restricted to, any breach or alleged breach of any such lien or claim of lienEnvironmental Laws; (dl) Upon deliver to the Optionors Technical Reports as follows: (i) by April 30, 2016 for the period ended December 31, 2015; and (ii) by April 30 of each successive year during the term of the Option for the period ended the previous December 31; (m) in the event that the Option is terminated, then within 45 days of such termination, the Optionee, at is sole cost, will have prepared and will deliver to the Optionors a Technical Report addressed to the Optionors with an effective date of not earlier than the date of such termination; (n) deliver to the Optionors Exploration Expense Reports as follows: (i) by April 30, 2015 for the period ended December 31, 2014 and by April 30 of each successive year during the term of the Option for the period ended the previous December 31 not previously reported upon; and (ii) within 60 days of the termination of this Agreementthe Option for the period up to the termination of the Option; (o) in the event that the Option is terminated, then for a period of one year from such termination, the Optionee, at its sole cost will permit the Optionors, or their representatives duly authorized by it in writing, access to all records listed in Section 11.3(f); (p) in the event that the Option is terminated, at the sole option of the Optionors the Optionee will leave remove within six months of such termination at its sole cost all equipment, buildings, structures, facilities and all other things brought onto the Property by the Optionee or its agents, failing which the Optionors may elect to either (i) remove such things at the sole cost of the Optionee, or (ii) retain such things on the Property in a safe condition which case the Optionee’s right, title and interest in accordance with those things will be automatically transferred to the applicable regulatory requirementsOptionors at no expense to the Optionors; (eq) It in the event that the Option is terminated, then within 15 days of such termination, the Optionee, at its sole cost, will at deliver to the Optionors all times maintain and keep true and correct records of all production those materials listed in Section 11.3(f); and the disposition thereof Optionee will have no further right to or interest in those materials; (r) make all filings and disclosures as required and within the time periods specified under all applicable securities legislation with respect to the issuance of all costs and expenditures incurred as well as all other data necessary or proper for the settlement of accounts between the parties hereto in connection with their rights and obligations any Shares under this Agreement; (fs) It will obtain from time to time, do all things required to ensure that the Optionee is authorized to carry on business in the State of Nevada; (t) upon oral or written request from the Underlying Royalty Holder or Optionor and subject to all applicable securities Laws, at the Optionee’s sole cost, immediately do all such things as may be necessary environmental permits prior in order to commencing operations on remove any restrictive legend all share certificates representing any Shares issued under this Agreement.; (u) ensure that at no time the Property and it will be responsible for trading in the shares of the Optionee become subject to: (i) a halt trade order; (ii) a stop trade order; (iii) a suspension; (iv) a cease trade order; or (v) any environmental assessments made by the governmental bodies as a result of operations on the Propertyother similar order or restriction; and (gv) It will indemnify provided that the Optionee first agrees in writing to pay the Optionors their reasonable fees and save harmless Optionor out-of-pocket expenses, the Optionee may, from any time to time, request assistance from the Optionors and all liability arising the Optionors may, but are not obligated to, elect to provide such assistance; (w) in relation the event that the Optionors have previously introduced to the Property Optionee or in the event that following the signing of this Agreement the Optionors introduce to the Optionee any personnel or consultants, including, but not limited restricted to, persons providing technical or geological services (together the “Optionors’ Service Providers”): (i) the Optionee will ensure that all agreements with the Optionors’ Service Providers are reduced to writing and contain the requirement set out in Section 11.3(w)(ii) of this Agreement; and (ii) upon the Option having terminated or upon the Optionee being in breach of any liability term of this Agreement (which breach has not been rectified in accordance with Section 23 of the Agreement): A. the Optionee will terminate the term of all agreements with the Optionors’ Service Providers; B. the Optionee will pay in full all amounts then owed to the Optionors’ Service Providers; C. the Optionors will be free to deal with the Optionors’ Service Providers; and D. the Optionee will not interfere with or hinder the Optionors’ Service Providers; and E. the Optionee will not enter into any further agreements that the Optionors’ Service Providers for their services; (x) in the event that the Optionee does not renew all of the mining claims forming the Property at least 60 days prior the scheduled expiry date of such mining claims, pay the Optionors in full, within 10 days of receipt of an invoice from environmental damage the Optionors setting out the commercially reasonable costs incurred by the Optionors in ensuring that the mining claims are renewed, it being agreed that there is no obligation upon the Optionors to renew the mining claims and such obligations always remains with the Optionee; and (y) maintain during the Termcurrency of the Option and for a period of two years thereafter its reporting issuer status under the United States Securities Exchange Act of 1934 and, unless such liability was caused by without restricting the fault foregoing, it will continue to file in a timely manner all materials required to be filed under all applicable United States securities laws, including the Securities Exchange Act of Optionor, or either of them, or their directors, officers, employees, agents or consultants1934.

Covenants of Optionee. The Optionee covenants and agrees with Optionor that so long as Optionee is the Operator of the exploration program on the Propertyshall: (a) It will make the annual lease payments in respect of the Property as such payments become due and to such party as set out in Lease No. ML 038; (b) maintain the Property in good standing and will pay all rentals, rates, duties, royalties, assessments, fees, taxes or other government charges levied submit assessment work with respect to the Property or Optionee’s operations thereon which shall fall due during the Term. Notwithstanding the forgoing, Expenditures set out in Section 5 hereof according to applicable laws and in acknowledgement that record title of regulations; (c) maintain the Property shall remain in the name of Optionor until such time as exercise of the Option, Optionor shall cooperate with and assist Optionee with the preparation of documentation required for good standing by the payment of such rentalstaxes, ratesassessments and rentals and the performance of all other actions which may be reasonably necessary in that regard; (d) permit the Optionor or its authorized representatives, dutiesat their own risk, royaltieswith five (5) days prior notice to the Optionee, assessments, fees, taxes or other government charges levied with respect access to the Property at all reasonable times, provided that the Optionor agrees to indemnify the Optionee against and to save it harmless from all costs, claims, liabilities and expenses that the Optionee may incur or Optionee’s operation thereon which shall fall due during the Term. In the event that Optionor fails to cooperate with and assist Optionee with the preparation suffer as a result of documentation required for the payment of such rentals, rates, duties, royalties, assessments, fees, taxes any property or other government charges levied with respect damage or injury (including injury causing death) to the Property Optionor or Optionee’s operation thereon which shall fall due during its authorized representatives while on the TermProperty, Optionor hereby grants except for any costs, claims, liabilities and expenses incurred as a result of any negligent act or omission of the Optionee or its employees and agents; (e) permit the full power of attorney to make all such payments and take all actions necessary or prudentOptionor, in Optionee’s at its sole and absolute discretion, to preserve participate in any management reviews of the property, and any such payments made as well any reasonable costs incurred by Optionee shall be deducted from any cash payments due Optionor pursuant exploration programs relating to Section 3.2(a) hereunderthe Property; (bf) It will do all work on the Property in a good and workmanlike fashion in accordance with all applicable laws, regulations, orders and ordinances of any governmental authority; (g) indemnify and save the Optionor harmless in respect of any and all costs claims, liabilities and expenses that the Optionor may incur or suffer, including those pursuant to applicable Environmental Laws, arising out of the Optionee's activities on the Property and, without limiting the generality of the foregoing shall, during the Option Period carry out third party liability insurance of not less than Five Million ($5,000,000) Dollars in respect of its operations on the Property in a careful and miner-like manner and in accordance with applicable laws and regulations for the benefit of the State of ArizonaOptionee and the Optionor as their interests may appear; (ch) It will properly pay all accounts not make any agreement whereby any third party may acquire any portion of every nature and kind for wages, supplies, Workers’ Compensation Assessments, or the equivalent under Arizona law, income tax deductions, and all other accounts and indebtedness incurred by it so that no claim or lien arises thereon or upon the ore or minerals contained therein and it will indemnify Optionor and save them harmless from any and all loss, costs, actions, suits, damages or claims which may be made against Optionor its interest in respect of the operations on the Property, provided however, that Optionee shall have the right to contest the validity of any such lien or claim of lien; (d) Upon termination of this Agreement, it will leave the Property in a safe condition or under this Agreement otherwise than in accordance with the applicable regulatory requirements; (e) It will at all times maintain and keep true and correct records provisions of all production and the disposition thereof and of all costs and expenditures incurred as well as all other data necessary or proper for the settlement of accounts between the parties hereto in connection with their rights and obligations under this Agreement; (f) It will obtain all necessary environmental permits prior to commencing operations on the Property and it will be responsible for any environmental assessments made by the governmental bodies as a result of operations on the Property; and (gi) It will indemnify and save harmless Optionor from not act or fail to do any and all liability arising act which it is required to do under this Agreement or otherwise which would result in relation to the Property includingor any part thereof, but not limited tobeing free and clear of all liens, any liability from environmental damage during the Termcharges, unless such liability was caused by the fault of Optionorencumbrances, obligations or either of themliabilities, or their directors, officers, employees, agents or consultantsincluding those pursuant to applicable Environmental Laws.

Covenants of Optionee. Optionee covenants and agrees with Optionor that so long as Optionee is the Operator of the exploration program work carried out on the Property: (a) It will maintain the Property in good standing and will pay all rentals, rates, duties, royalties, assessments, fees, taxes or other government charges levied with respect to the Property or Optionee’s operations thereon which shall fall due during the Term. Notwithstanding the forgoing, and in acknowledgement that record title of the Property shall remain in the name of Optionor until such time as exercise of the Option, Optionor shall cooperate with and assist Optionee with the preparation of documentation required for the payment of such rentals, rates, duties, royalties, assessments, fees, taxes or other government charges levied with respect to the Property or Optionee’s operation thereon which shall fall due during the Term. In the event that Optionor fails to cooperate with and assist Optionee with the preparation of documentation required for the payment of such rentals, rates, duties, royalties, assessments, fees, taxes or other government charges levied with respect to the Property or Optionee’s operation thereon which shall fall due during the Term, Optionor hereby grants Optionee the full power of attorney to make all such payments and take all actions necessary or prudent, in Optionee’s sole and absolute discretion, to preserve the property, and any such payments made as well any reasonable costs incurred by Optionee shall be deducted from any cash payments due Optionor pursuant to Section 3.2(a) hereunder; (b) It will carry out its operations on the Property in a careful and miner-like manner and in accordance with applicable laws and regulations of the State of ArizonaNevada; (c) It will properly pay all accounts of every nature and kind for wages, supplies, Workers’ Compensation Assessments, or the equivalent under Arizona Nevada law, income tax deductions, and all other accounts and indebtedness incurred by it so that no claim or lien arises thereon or upon the ore or minerals contained therein and it will indemnify Optionor and save them harmless from any and all loss, costs, actions, suits, damages or claims which may be made against Optionor in respect of the operations on the Property, provided however, that Optionee shall have the right to contest the validity of any such lien or claim of lien; (d) Upon termination of this Agreement, it will leave the Property in a safe condition in accordance with the applicable regulatory requirements; (e) It will at all times maintain and keep true and correct records of all production and the disposition thereof and of all costs and expenditures incurred as well as all other data necessary or proper for the settlement of accounts between the parties hereto in connection with their rights and obligations under this Agreement; (f) It will obtain all necessary environmental permits prior to commencing operations on the Property and it will be responsible for any environmental assessments made by the governmental bodies as a result of operations on the Property; and (g) It will indemnify and save harmless Optionor from any and all liability arising in relation to the Property including, but not limited to, any liability from environmental damage during the Term, unless such liability was caused by the fault of Optionor, or either of them, or their directors, officers, employees, agents or consultants.