Exhibit 10.6

Conditional Agreement Not To Exercise Stock Options
Under Stock Option Agreement Dated January 20, 1999
Pursuant to Non-Qualified Stock Option and Stock
Grant Plan

This Agreement is made effective as of December 6,
2002 by and between U.S. Gold Corporation (the
"Corporation") and David C. Reid ("Option
Holder").

WHEREAS, Option Holder and Corporation entered into
that certain Stock Option Agreement dated January
20, 1999 (the "SOA") under Corporation's Non-
Qualified Stock Option and Stock Grant Plan (the
"Plan") covering an aggregate of 665,000 shares
of Common Stock of Corporation at an exercise price
of $0.16 per share and with expiration date
thereunder of January 21, 2004, and

WHEREAS, Corporation had previously reserved
sufficient numbers of shares of authorized but
unissued Common Stock of the Corporation under the
Plan to provide for the exercise of the shares of
Common Stock under the SOA as well as other
outstanding stock option agreements, and

WHEREAS, Corporation required funding critical to
its operations and for the near-term protection of
its assets and therefore negotiated for the sale
and has closed certain private transactions with
third parties (the "Purchasers") covering the
sale of Common Stock of the Corporation, and

WHEREAS, in order for the Corporation to have
sufficient numbers of authorized and unissued
shares of Common Stock not otherwise reserved for
use under the Plan to sell to such Purchasers, the
Option Holder agreed to temporarily and
conditionally forgo the right to exercise a portion
of the options to purchase Common Stock under his
SOA in consideration for the commitments and
representations of the Corporation contained
herein, in order that the Corporation could remove
those number of shares of Common Stock from the
classification of "reserved shares" under the
Plan and for the Corporation to then be able to
sell such number of shares of Common Stock to
Purchasers, all as subject to the terms of this
Agreement.

        NOW THEREFORE the Corporation and Option
Holder agree as follows:

A.  Option Holder commits and agrees to Corporation
as follows:

1.  Option Holder agrees not to exercise an
aggregate of 302,500 shares of Common Stock under
his SOA until and unless the Corporation reserves
sufficient number of shares of Common Stock from
its authorized but unissued numbers of shares of
Common Stock, in whole or in part, to allow such
exercise by Option Holder of the full number or any
lesser number of shares of Common Stock, if the
Corporation is able to reserve some but not all of
the required by and subject to such SOA.

2.  This agreement in no way limits the ability of
Option Holder to exercise any or all of his option
shares under his SOA which are currently or in the
future become covered by reserved numbers of shares
of Common Stock of the Corporation under the Plan
and under the SOA.

B.  In consideration for the agreement of Option
Holder hereunder, the Corporation agrees and
commits to Option Holder as follows:

1.  The Corporation will use its best efforts to
make available and to reserve sufficient numbers of
authorized but unissued shares of Common Stock of
the Corporation under the Plan to allow exercise of
all shares of Common Stock subject to outstanding
stock option agreements including the SOA with
Option Holder.  This includes, but is not limited
to, the approval by the shareholders of the
Corporation of any increase to the authorized
number of Common Stock equity of the Corporation as
well as the acquisition of treasury shares by the
Corporation which could otherwise be used for
reservation of Common Stock under the Plan and the
SOA.

2.  If the Corporation is unable to reserve
sufficient numbers of authorized but unissued
shares of Common Stock under the Plan for all
outstanding stock option agreements including the
SOA to the Option Holder, then the Corporation
commits to otherwise keep the Option Holder whole
in terms the intrinsic economic value of in-the-
money stock option shares subject to the limitation
on exercise contained in this Agreement as that
number may be reduced from time to time by
additional reserved shares being replaced thereby
making a portion of the option shares under the SOA
exercisable.

This Agreement shall be governed by and construed
in accordance with the laws of the State of
Colorado.

This Agreement supersedes any and all other
agreements, whether oral or in writing, between the
parties with respect to the subject matter.  Each
party to this Agreement acknowledges that no
representations, inducements, promises, or
agreements, orally or otherwise, have been made by
the other party, or anyone acting on behalf of any
party, that are not embodied in this Agreement, and
that no agreement, statement, or promise not
contained in this Agreement shall be valid or
binding.

IN WITNESS WHEREOF, the parties hereto have
executed this Agreement effective as of December 6,
2002.

Option Holder:

/S/ David C. Reid
David C. Reid

Corporation:

/S/ John W. Goth
John W. Goth, Director and Chairman of Compensation
Committee