PLEDGE
AGREEMENT


 


THIS PLEDGE
AGREEMENT (this “Agreement”), dated as of April 6, 2012 is entered into between Elkhorn Goldfields, LLC, a Delaware
limited liability company (“Pledgor”), and Gordon Snyder, as Administrative Agent, acting on behalf of the Lender
Parties (as hereinafter defined) (“Secured Party”), with reference to the following:


 


WHEREAS,
Pledgor is obligated to Secured Party in accordance with certain agreements including without limitation the following:


 


1.
those certain loan agreements, promissory notes, and other loan documents among Administrative Agent and Pledgor, dated December
8 and December 21, 2006 in the total original principal amount of $5,000,000.00 (the “2006 Loan”); and


 


2.
those certain loan agreements, promissory notes, and other loan documents among Administrative Agent and MFPI Partners, LLC (“MFPI”),
dated February 22, 2007 and modified May 14, 2007 in the total original principal amount of $8,050,000.00 (the “2007 Loan”),
made the joint and several obligation of Pledgor and MFPI by the Forbearance Agreement hereinafter described; and


 


3.
those certain loan agreements, promissory notes, and other loan documents among Administrative Agent and MFPI Partners, LLC, dated
January 22, 2008 in the total original principal amount of $5,000,000.00 (the “2008 Loan”) made the joint and several
obligation of Pledgor and MFPI by the Forbearance Agreement hereinafter described; and


 


4.
that certain Loan and Administrative Agency Agreement, and other loan documents (including without limitation the Mortgages hereinafter
defined) dated as of May 13, 2009 in the original principal amount of $1,000,000.00 (the “2009 Loan”); and


 


5.
that certain Forbearance Agreement dated as of April 30, 2010 by and between (among others) the Pledgor, MFPI and Administrative
Agent (the “Forbearance Agreement”); and


 


7.
that certain Loan Reinstatement and Modification Agreement between Pledgor, MFPI and Administrative Agent dated April 6, 2012
(the “2012 Agreement”)


 


all
as amended, restated, or otherwise modified from time to time, collectively, the “Loan Agreements”), pursuant to which
Secured Party has made certain financial accommodations to Pledgor;


 


WHEREAS,
Pledgor beneficially owns the Pledged Interests (as hereinafter defined) in the Issuer (as hereinafter defined);


 


WHEREAS,
to induce Secured Party to make certain additional financial accommodations provided to Pledgor pursuant to all of the Loan Agreements,
including the 2012 Agreement, Pledgor desires to pledge, grant, transfer, and assign to Secured Party a security interest in the
Collateral (as hereinafter defined) to secure the Secured Obligations (as hereinafter defined), as provided herein.


 



    	 



    	 



    

 


NOW,
THEREFORE, in consideration of the mutual promises, covenants, representations, and warranties set forth herein and for other
good and valuable consideration, the parties hereto agree as follows:


 


		1.	Definitions
                                                                and Construction



 


		(a)	Definitions.



 


All
initially capitalized terms used herein and not otherwise defined herein shall have the meaning ascribed thereto in the Loan Agreement.
As used in this Agreement:


 


“Bankruptcy
Code” means United States Bankruptcy Code (11 U.S.C. Section 101 et seq.), as in effect from time to time, and any successor
statute thereto.


 


“Business
Day” means any day that is not a Saturday, Sunday, or other day on which national banks are authorized or required to close.


 


“Code”
means the Uniform Commercial code as in effect in the State of Colorado from time to time.


 


“Loan
Agreement” shall have the meaning ascribed thereto in the recitals to this Agreement.


 


“Collateral”
shall mean the Pledged Interests and the Proceeds, collectively.


 


“Equity
Interests” means all securities, shares, units, options, warrants, interests, participations, or other equivalents (regardless
of how designated) of or in a corporation, partnership, limited liability company, or similar entity, whether voting or nonvoting,
certificated or uncertificated, including general partner partnership interests, limited partner partnership interests, common
stock, preferred stock, or any other “equity security” (as such term is defined in Rule 3a11-1 of the General Rules
and Regulations promulgated by the Securities and Exchange Commission under the Securities Exchange Act of 1934).


 


“Event
of Default” shall have the meaning ascribed thereto in the Loan Agreements.


 


“Holder”
and “Holders” shall have the meanings ascribed thereto in Section 3 of this Agreement.


 


“Issuer”
shall mean each of the Person identified as an Issuer on Schedule 1 attached hereto (or any addendum thereto), and any successors
thereto, whether by merger or otherwise.


 


“Lien”
shall mean any lien, mortgage, pledge, assignment (including any assignment of rights to receive payments of money), security
interest, charge, or encumbrance of any kind (including any conditional sale or other title retention agreement, any lease in
the nature thereof, or any agreement to give any security interest).


 



    	 



    	 



    

 


“Pledged
Interests” shall mean (a) all Equity Interests of the Issuers identified on Schedule 1; and (b) the certificates or instruments
representing such Equity Interests.


 


“Pledgor”
shall have the meaning ascribed thereto in the preamble to this Agreement.


 


“Proceeds”
shall mean all proceeds (including proceeds of proceeds) of the Pledged Interests including all: (a) rights, benefits, distributions,
premiums, profits, dividends, interest, cash, instruments, documents of title, accounts, contract rights, inventory, equipment,
general intangibles, payment intangibles, deposit accounts, chattel paper, and other property from time to time received, receivable,
or otherwise distributed in respect of or in exchange for, or as a replacement of or a substitution for, any of the Pledged Interests
or proceeds thereof (including any cash, Equity Interests, or other securities or instruments issued after any recapitalization,
readjustment, reclassification, merger or consolidation with respect to the Issuers and any security entitlements, as defined
in Section 8-102(a)(17) of the Code, with respect thereto); (b) “proceeds,” as such term is defined in Section 9-102(a)(64)
of the Code; (c) proceeds of any insurance, indemnity, warranty, or guaranty (including guaranties of delivery) payable from time
to time with respect to any of the Pledged Interests or proceeds thereof; (d) payments (in any form whatsoever) made or due and
payable to Pledgor from time to time in connection with any requisition, confiscation, condemnation, seizure or forfeiture of
all or any part of the Pledged Interests or proceeds thereof; and (3) other amounts from time to time paid or payable under or
in connection with any of the Pledged Interests or proceeds thereof.


 


“Registered
Organization” shall have the meaning ascribed thereto in Section 9-102(a)(7) of the Code.


 


“Secured
Obligations” shall mean all liabilities, obligations, or undertakings owing by Pledgor to Secured Party of any kind or description
arising out of or outstanding under, advanced or issued pursuant to, or evidenced by the Loan Agreements, this Agreement, or the
other Transaction Documents, irrespective of whether for the payment of money, whether direct or indirect, absolute or continent,
due or to become due, voluntary or involuntary, whether now existing or hereafter arising, and including all interest (including
interest that accrues after the filing of a case under the Bankruptcy Code) and any and all costs, fees (including reasonable
attorneys' fees), Administrative Agency Fee and expenses which Pledgor is required to pay pursuant to any of the foregoing, by
law, or otherwise.


 


“Secured
party” shall have the meaning ascribed thereto in the preamble to this Agreement, together with its successors or assigns.


 


“Securities
Act” shall have the meaning ascribed thereto in Section 9(c) of this Agreement.


 


“Transaction
Documents” shall mean the Loan Agreements and all other agreements, instruments, or other documents entered into or executed
in connection therewith, in each case, as amended, restated, or otherwise modified from time to time.


 



    	 



    	 



    

 


		(b)	Construction.



 





(i)   Unless
the context of this Agreement clearly requires otherwise, references to the plural include the singular and to the singular include
the plural, the part includes the whole, the term “including” is not limiting, and the term “or” has,
except where otherwise indicated, the inclusive meaning represented by the phrase “and/or.” The words “hereof,”
“herein,” “hereby,” “hereunder,” and other similar terms in this Agreement refer to this Agreement
as a whole and not exclusively to any particular provision of this Agreement. Article, section, subsection, exhibit, and schedule
references are to this Agreement unless otherwise specified. All of the exhibits or schedules attached to this Agreement shall
be deemed incorporated herein by reference. Any reference to any of the following documents includes any and all alterations,
amendments, restatements, extensions, modifications, renewals, or supplements thereto or thereof, as applicable: this Agreement,
the Loan Agreements, or any of the other Transaction Documents.


 


(ii)   Neither
this Agreement nor any uncertainty or ambiguity herein shall be construed or resolved against Secured party or Pledgor, whether
under any rule of construction or otherwise. On the contrary, this Agreement has been reviewed by both of the parties and their
respective counsel and shall be construed and interpreted according to the ordinary meaning of the words used so as to fairly
accomplish the purposes and intentions of the parties hereto.


 


(iii)    In
the event of any direct conflict between the express terms and provisions of this Agreement and of any of the Loan Agreements,
the terms and provisions of the Loan Agreements shall control. Terms not otherwise defined herein shall have the meaning set forth
in the 2012 Agreement




 


		2.	Pledge.



 


As
security for the prompt payment and performance of the Secured Obligations in full by Pledgor when due, whether at stated maturity,
by acceleration or otherwise (including amounts that would become due but for the operation of the provisions of the Bankruptcy
Code), Pledgor hereby pledges, grants, transfers, and assigns to Secured Party a security interest in all of Pledgor’s right,
title, and interest in and to the Collateral.


 


		3.	Delivery
                                                                       and Registration of Collateral.



 


		(a)	All
                                                                certificates or instruments representing or evidencing the Collateral
                                                                shall be promptly delivered by Pledgor to Secured party or Secured
                                                                Party’s designee pursuant hereto at a location designated
                                                                by Secured Party and shall be held by or on behalf of Secured
                                                                Party pursuant hereto, and shall be in suitable form for transfer
                                                                by delivery, or shall be accompanied by duly executed Endorsement
                                                                Certificate in the form attached hereto as Exhibit A or other
                                                                instrument of transfer or assignment in blank, in form and substance
                                                                satisfactory to Secured Party.



 



    	 



    	 



    

 


		(b)	Upon
                                                                the occurrence and during the continuance of an Event of Default
                                                                and pursuant to the remedies provided in the 2012 Agreement, Secured
                                                                Party shall have the right, at any time in its discretion and
                                                                without notice to Pledgor, to transfer to or to register on the
                                                                books of the Issuer (or of any other Person maintaining records
                                                                with respect to the Collateral) in the name of Secured Party or
                                                                any of its nominees any or all of the Collateral.



 


		(c)	If,
                                                                at any time and from time to time, any Collateral (including any
                                                                certificate or instrument representing or evidencing any Collateral)
                                                                is in the possession of a Person other than Secured Party or Pledgor
                                                                (a “Holder”), then Pledgor shall immediately, at Secured
                                                                Party’s option, either cause such Collateral to be delivered
                                                                into Secured Party’s possession (which may include actual
                                                                physical possession by a fiduciary of Secured Party), or cause
                                                                such Holder to enter into a control agreement, in form and substance
                                                                satisfactory to Secured Party, and take all other steps deemed
                                                                necessary by Secured party to perfect the security interest of
                                                                Secured Party in such Collateral, all pursuant to Sections 9-106
                                                                & 9-313 of the Code or other applicable law governing the
                                                                perfection of Secured Party’s security interest in the Collateral
                                                                in the possession of such Holder.



 


		(d)	Any
                                                                and all Collateral (including dividends, interest, and other cash
                                                                distributions) at any time received or held by Pledgor shall be
                                                                so received or held in trust for Secured Party, shall be segregated
                                                                from other funds and property of Pledgor and shall be forthwith
                                                                delivered to Secured Party in the same form as so received or
                                                                held, with any necessary endorsements; provided that cash dividends
                                                                or distributions received by Pledgor, may be retained by Pledgor
                                                                in accordance with Section 4 and used in the ordinary course of
                                                                Pledgor’s business.



 


		(e)	If
                                                                at any time, and from time to time, any Collateral consists of
                                                                an uncertificated security or a security in book entry form, then
                                                                Pledgor shall immediately cause such Collateral to be registered
                                                                or entered, as the case may be, in the name of Secured Party,
                                                                or otherwise cause Secured Party’s security interest thereon
                                                                to be perfected in accordance with applicable law.



 


		4.	Voting
                                                                Rights and Dividends.



 


		(a)	So
                                                                long as no Event of Default shall have occurred and be continuing,
                                                                Pledgor shall be entitled to exercise any and all voting and other
                                                                consensual rights pertaining to the Collateral or any part thereof
                                                                for any purpose not inconsistent with the terms of the Transaction
                                                                Documents and shall be entitled to receive and retain any cash
                                                                dividends or distributions paid or distributed in respect of the
                                                                Collateral; provided, however, that it is understood that Pledgor
                                                                shall have no right to exercise any optional redemption rights
                                                                provided to any holder in respect of the Collateral for as long
                                                                as any amounts owed to Secured Party pursuant to any of the Transaction
                                                                Documents remains outstanding and unpaid or any obligation of
                                                                Pledgor or MFPI to Secured Party remains unperformed.



 



    	 



    	 



    

 


		(b)	Upon
                                                                the occurrence and during the continuance of an Event of Default,
                                                                all rights of Pledgor to exercise the voting and other consensual
                                                                rights or receive and retain cash dividends or distributions that
                                                                it would otherwise be entitled to exercise or receive and retain,
                                                                as applicable pursuant to Section 4(a), shall cease, and all such
                                                                rights shall thereupon become vested in Secured Party, who shall
                                                                thereupon have the sole right to exercise such voting or other
                                                                consensual rights, including without limitation any optional right
                                                                of redemption provided to the holder of the collateral and to
                                                                receive and retain such cash dividends and distributions. Pledgor
                                                                shall execute and deliver (or cause to be executed and delivered)
                                                                to Secured Party all such proxies and other instruments as Secured
                                                                Party may reasonably request for the purpose of enabling Secured
                                                                Party to exercise the voting and other rights, including without
                                                                limitation any redemption rights which it is entitled to exercise
                                                                and to receive the dividends and distributions that it is entitled
                                                                to receive and retain pursuant to the preceding sentence.



 


		5.	Representations
                                                                and Warranties. 



 


Pledgor
represents, warrants, and covenants as follows:


 


		(a)	Pledgor
                                                                has taken all steps it deems necessary or appropriate to be informed
                                                                on a continuing basis of changes or potential changes affecting
                                                                the Collateral (including rights of redemption, conversion and
                                                                exchange, rights to subscribe, payment of dividends, reorganizations
                                                                or recapitalization, tender offers and voting and registration
                                                                rights), and Pledgor agrees that Secured party shall have no responsibility
                                                                or liability for informing Pledgor of any such changes or potential
                                                                changes or for taking any action or omitting to take any action
                                                                with respect thereto.



 


		(b)	Pledgor
                                                                is a limited liability company in good standing organized under
                                                                the laws of the state of Delaware. Pledgor is a limited liability
                                                                company.



 


		(c)	All
                                                                information herein or hereafter supplied to Secured party by or
                                                                on behalf of Pledgor in writing with respect to the Collateral
                                                                is, or in the case of information hereafter supplied will be,
                                                                accurate and complete in all material respects.



 


		(d)	Pledgor
                                                                is and will be the sole legal and beneficial owner of the Collateral
                                                                (including the Pledged Interests and all other Collateral acquired
                                                                by Pledgor after the date hereof) free and clear of any adverse
                                                                claim, Lien, or other right, title, or interest of any party,
                                                                other than the Liens in favor of Secured Party.



 



    	 



    	 



    

 


		(e)	This
                                                                Agreement, and the delivery to Secured Party of the Pledged Interests
                                                                representing Collateral (or the control agreements referred to
                                                                in Section 3 of this Agreement), creates a valid, perfected, and
                                                                first priority security interest in one hundred percent (100%)
                                                                of the Pledged Interests in favor of Secured Party securing payment
                                                                of the Secured Obligations, and all actions necessary to achieve
                                                                such perfection have been duly taken.



 


		(f)	Schedule
                                                                1 to this Agreement is true and correct and complete in all material
                                                                respects. Without limiting the generality of the foregoing, except
                                                                as set forth on Schedule 1, all the Pledged Interests are in certificated
                                                                form, and, except to the extent registered in the name of Secured
                                                                Party or its nominee pursuant to the provisions of this Agreement,
                                                                are registered in the name of Pledgor.



 


		(g)	There
                                                                are no presently existing Proceeds owned by Pledgor.



 


		(h)	The
                                                                Pledged Interests have been duly authorized and validly issued
                                                                and are fully paid and nonassessable.



 


		(i)	Neither
                                                                the pledge of the Collateral pursuant to this Agreement nor the
                                                                extensions of credit represented by the Secured obligations violates
                                                                Regulation T, U, or X of the Board of Governors of the Federal
                                                                Reserve System.



 


		6.	Further
                                                      Assurances.



 


		(a)	Pledgor
                                                                agrees that from time to time, at the expense of Pledgor, Pledgor
                                                                will promptly execute and deliver all further instruments and
                                                                documents, and take all further action that may be necessary or
                                                                reasonably desirable, or that Secured Party may request, in order
                                                                to perfect and protect any security interest granted or purported
                                                                to be granted hereby or to enable Secured party to exercise and
                                                                enforce its rights and remedies hereunder with respect to any
                                                                Collateral. Without limiting the generality of the foregoing,
                                                                Pledgor will: (i) at the request of Secured party, mark conspicuously
                                                                each of its records pertaining to the Collateral with a legend,
                                                                in form and substance reasonably satisfactory to Secured Party,
                                                                indicating that such Collateral is subject to the security interest
                                                                granted hereby; (ii) execute any such instruments or notices,
                                                                as may be necessary and reasonably desirable, or as Secured Party
                                                                may reasonably request, in order to perfect and preserve the first
                                                                priority security interests granted or purported to be granted
                                                                hereby; (iii) allow inspection of the Collateral by Secured Party
                                                                or Persons designated by Secured Party; and (iv) appear in and
                                                                defend any action or proceeding that may affect Pledgor’s
                                                                title to or Secured party’s security interest in the Collateral.



 


		(b)	Pledgor
                                                                hereby authorizes Secured Party to file one or more financing
                                                                or continuation statements, and amendments thereto, relative to
                                                                all or any part of the Collateral. A carbon, photographic, or
                                                                other reproduction of this Agreement or any financing statement
                                                                covering the Collateral or any part thereof shall be sufficient
                                                                as a financing statement where permitted by law.



 



    	 



    	 



    

 


		(c)	Pledgor
                                                                will furnish to Secured Party, upon the request of Secured Party:
                                                                (i) a certificate executed by an authorized officer of Pledgor,
                                                                and dated as of the date of delivery to Secured Party, itemizing
                                                                in such detail as Secured Party may request, the Collateral which,
                                                                as of the date of such certificate, has been delivered to Secured
                                                                Party by Pledgor pursuant to the provisions of this Agreement;
                                                                and (ii) such statements and schedules further identifying and
                                                                describing the Collateral and such other reports in connection
                                                                with the Collateral as Secured Party may reasonably request.



 


		7.	Covenants
                                                                of Pledgor.



 


Pledgor
shall:


 


		(a)	Perform
                                                                each and every covenant in the Transaction Documents applicable
                                                                to Pledgor;



 


		(b)	Neither
                                                                change its jurisdiction of organization nor cease to be in good
                                                                standing, in each case, without giving Secured party at least
                                                                thirty (30) days prior written notice thereof;



 


		(c)	To
                                                                the extent it may lawfully do so, use its best efforts to prevent
                                                                the Issuer from issuing Proceeds, except for cash dividends and
                                                                other distributions to be paid by the Issuer to Pledgor; and



 


		(d)	Upon
                                                                receipt by Pledgor of any material notice, report, or other communication
                                                                from the Issuer or any Holder relating to all or any part of the
                                                                Collateral, deliver such notice, report or other communication
                                                                to Secured Party as soon as possible, but in no event later than
                                                                five (5) days following the receipt thereof by Pledgor. Notwithstanding
                                                                the foregoing, if such notice, report, or other communication
                                                                from the Issuer or any Holder is filed pursuant to Issuer or Holder’s
                                                                reporting obligations set forth in the Securities Exchange Act
                                                                of 1934, as amended, Pledgor shall have no obligation to deliver
                                                                such notice, report or other communication to Secured Party.



 


		8.	Secured
                                                                Party as Pledgor’s Attorney-in-Fact.



 


		(a)	Pledgor
                                                                hereby irrevocably appoints Secured Party as Pledgor’s agent
                                                                and attorney-in-fact, in Secured Party’s sole good faith
                                                                and commercially reasonable discretion, to make, execute and deliver
                                                                any and all documents and writings which may be necessary or appropriate
                                                                for approval of, or be required by, any regulatory authority located
                                                                in any city, county, state or country where Pledgor or any of
                                                                the Issuers engage in business, in order to transfer or to more
                                                                effectively transfer any of the Pledged Interests or otherwise
                                                                enforce Secured Party’s rights hereunder.



 



    	 



    	 



    

 


		9.	Remedies
                                                                upon Default.



 


Upon
the occurrence and during the continuance of an Event of Default:


 


		(a)	Secured
                                                                Party shall notify Issuer as attorney-in-fact of Pledgor that
                                                                Pledgor is exercising the put rights of Pledgor as set forth in
                                                                the Certificate and shall direct the payment of the proceeds for
                                                                the benefit of the Holders in the total aggregate amount of $60
                                                                million of the exercise of the put rights as provided for in the
                                                                Certificate into a control account (the “Control Account”)
                                                                to be held for the benefit of Borrower Parties and Administrative
                                                                Agent in accordance with the terms of a customary control account
                                                                agreement by and among Borrower Parties, Administrative Agent
                                                                and a nationally recognized bank or securities intermediary firm.,
                                                                to be held for the benefit of Borrower Parties and Administrative
                                                                Agent. Upon disbursement by Issuer of all of the put proceeds
                                                                into the Control Account, Secured Party shall promptly tender
                                                                the Preferred Shares, provided that all sums due, together with
                                                                accrued interest, Administrative Agent’s Fee, reasonable
                                                                costs and fees of the holder of the Control Account and the reasonable
                                                                attorney’s fees of Secured Party are paid to Secured Party
                                                                in full, to Issuer and shall release the Pledged Shares. Upon
                                                                completion of Secured Party’s foreclosure of the Pledged
                                                                Shares of Secured Party, the proceeds of the Pledged Account shall
                                                                be distributed to Secured Party in the amount of the debt plus
                                                                interest, costs, Administrative Agent’s Fee and reasonable
                                                                attorney’s fees of Secured Party, and all sums prospectively
                                                                due under the Collar Option. Following any distribution whatsoever
                                                                to Secured Party of the proceeds in the Control Account (either
                                                                in part or in full), Administrative Agent shall with reasonable
                                                                promptness provide to Pledgor a statement showing the following:
                                                                (a) the disbursement requested from the Pledged Account; (b) a
                                                                breakdown of the anticipated application of the disbursement to
                                                                debt, interest, costs, fees, etc.; and (c) the balance owed to
                                                                Secured Party after the anticipated application of the disbursement.
                                                                In the event that such statement shall indicate that no balance
                                                                would remain due to Secured Party after the disbursement, the
                                                                remaining balance of the Control Account shall be paid to Pledgor,
                                                                less the fees of the holder of the Control Account and its reasonable
                                                                attorney’s fees, and the Control Account closed. If there
                                                                is a balance remaining due to Secured Party after the anticipated
                                                                application of the disbursement from the Control Account, Pledgor
                                                                shall be entitled to request a disbursement of proceeds from the
                                                                Control Account so long as the funds remaining in the Control
                                                                Account after such disbursement to Pledgor equal the balance owed
                                                                to Administrative Agent/Holder plus $100,000.00.



 



    	 



    	 



    

 


		(b)	In
                                                                the event that (i) Issuer shall fail within thirty (30) business
                                                                days following receipt of Secured Party’s notice of exercise
                                                                of the put rights of Pledgor to pay the proceeds of the put rights
                                                                into the Control Account as provided in this Section 9(a) and
                                                                in the Certificate or (ii) the amount of the proceeds of the put
                                                                rights is insufficient to pay the remaining sums then due under
                                                                this Agreement, including all accrued interest, reasonable costs
                                                                and fees and Administrative Agency Fee, then, Secured Party shall
                                                                be free sell the Collateral or any part thereof in one or more
                                                                parcels at public or private sale, at any exchange, broker’s
                                                                board or at any of Secured Party’s offices or elsewhere,
                                                                for cash, on credit or for future delivery, at such time or times
                                                                and at such price or prices and upon such other terms as Secured
                                                                Party may deem commercially reasonable, irrespective of the impact
                                                                of any such sales on the market price of the Collateral; provided,
                                                                however, that Administrative Agent’s pursuit of the sale
                                                                of the Collateral after the failure of Issuer to pay the put proceeds
                                                                into the Control Account within the time provided shall not constitute
                                                                an election by Secured Party to withdraw the put notice and Secured
                                                                Party shall have the right to pursue all remedies it may have
                                                                under the Credit Documents, the Loan Agreements and the Forbearance
                                                                Agreement singly in sequence or together simultaneously, successively
                                                                and cumulatively.



 


		i.	To
                                                             the maximum extent permitted by applicable law, Secured Party may
                                                             be the purchaser of any or all of the Collateral at any such sale
                                                             and shall be entitled, for the purpose of bidding and making settlement
                                                             or payment of the purchase price for all or any portion of the Collateral
                                                             sold at any such public sale, to use and apply all or any part of
                                                             the Secured Obligations as a credit on account of the purchase price
                                                             of any Collateral payable at such sale. Each purchaser at any such
                                                             sale shall hold the property sold absolutely free from any claim
                                                             or right on the part of Pledgor, and Pledgor hereby waives (to the
                                                             extent permitted by law) all rights of redemption, stay, or appraisal
                                                             that it now has or may at any time in the future have under any rule
                                                             of law or statute now existing or hereafter enacted. Pledgor agrees
                                                             that, to the extent notice of sale shall be required by law, at least
                                                             ten (10) calendar days’ notice to Pledgor of the time and place
                                                             of any public sale or the time after which a private sale is to be
                                                             made shall constitute reasonable notification. Secured Party shall
                                                             not be obligated to make any sale of Collateral regardless of notice
                                                             of sale having been given. Secured Party may adjourn any public or
                                                             private sale from time to time by announcement at the time and place
                                                             fixed therefor, and such sale may, without further notice, be made
                                                             at the time and place to which it was so adjourned. To the maximum
                                                             extent permitted by law, Pledgor hereby waives any claims against
                                                             Secured Party arising because the price at which any Collateral may
                                                             have been sold at such a private sale was less than the price that
                                                             might have been obtained at a public sale, even if Secured Party
                                                             accepts the first offer received and does not offer such Collateral
                                                             to more than one offeree.



 


		ii.	In
                                                              connection with this Section 9(b), Pledgor hereby agrees that any
                                                              sale or other disposition of the Collateral conducted in conformity
                                                              with reasonable commercial practices of banks, insurance companies,
                                                              or other financial institutions in the city and state where Secured
                                                              Party is located in disposing of property similar to the Collateral
                                                              shall be deemed to be commercially reasonable.



 



    	 



    	 



    

 


		10.	Application
                                                                 of Proceeds.



 


Upon
the occurrence and during the continuance of an Event of Default, any cash held by Secured Party as Collateral and all cash Proceeds
received by Secured Party in respect of any sale of, collection from, or other realization upon all or any part of the Collateral
pursuant to the exercise by Secured Party of its remedies as a secured creditor as provided in Section 9 shall be applied from
time to time to any part or portion of the indebtedness of Pledgor to Secured Party by Secured Party in Secured Party’s
sole discretion, as provided in the Loan Agreements.


 


		11.	Expenses.



 


To pay and reimburse Secured Party upon demand for all reasonable costs
and expenses (including, without limitation, reasonable attorneys’ fees and expenses) that Secured Party may incur in connection
with (i) the custody, use or preservation of, or the sale of, collection from or other realization upon, any of the Collateral,
including the reasonable expenses of re-taking, holding, preparing for sale or lease, selling or otherwise disposing of or realizing
on the Collateral, (ii) the exercise or enforcement of any rights or remedies granted hereunder, under the Loan Agreement, or
under any of the other Credit Documents or otherwise available to it (whether at law, in equity or otherwise), or (iii) the failure
by Pledgor to perform or observe any of the provisions hereof. The provisions of this Section shall survive the execution and
delivery of this Agreement, the repayment of any of the Secured Obligations, the termination of the commitments of Secured Party
under the Loan Agreement and the termination of this agreement or any other Credit Document.


 


		12.	Duties
                                                                 of Secured Party.



 


The
powers conferred on Secured Party hereunder are solely to protect its interests in the Collateral and shall not impose on it any
duty to exercise such powers. Except as provided in Section 9-207 of the Code, Secured Party shall have no duty with respect to
the Collateral or any responsibility for taking any necessary steps to preserve rights against any Person with respect to any
Collateral.


 


		13.	Choice
                                                                 of Law and Venue; Submission to Jurisdiction; Service of Process.



 


		(a)	THE
                                                                VALIDITY OF THIS AGREEMENT, ITS CONSTRUCTION, INTERPRETATION,
                                                                AND ENFORCEMENT, AND THE RIGHTS OF THE PARTIES HERETO SHALL BE
                                                                DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH
                                                                THE LAWS OF THE STATE OF COLORADO (WITHOUT REFERENCE TO THE CHOICE
                                                                OF LAW PRINCIPLES THEREOF). THE PARTIES AGREE THAT ALL ACTIONS
                                                                OR PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT SHALL
                                                                BE TRIED AND LITIGATED ONLY IN THE STATE AND FEDERAL COURTS LOCATED
                                                                IN THE COUNTY OF DENVER, STATE OF COLORADO OR, AT THE SOLE OPTION
                                                                OF SECURED PARTY, IN ANY OTHER COURT IN WHICH SECURED PARTY SHALL
                                                                INITIATE LEGAL OR EQUITABLE PROCEEDINGS AND WHICH HAS SUBJECT
                                                                MATTER JURISDICTION OVER THE MATTER IN CONTROVERSY.



 



    	 



    	 



    

 


		(b)	PLEDGOR
                                                                HEREBY SUBMITS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY
                                                                AND UNCONDITIONALLY, TO THE JURISDICTION OF THE AFORESAID COURTS
                                                                AND WAIVES, TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, ANY
                                                                RIGHT IT MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS
                                                                OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT
                                                                IN ACCORDANCE WITH THIS SECTION.



 


		(c)	NOTHING
                                                                IN THIS AGREEMENT SHALL BE DEEMED OR OPERATE TO AFFECT THE RIGHT
                                                                OF SECURED PARTY TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED
                                                                BY LAW, OR TO PRECLUDE THE ENFORCEMENT BY SECURED PARTY OF ANY
                                                                JUDGMENT OR ORDER OBTAINED IN SUCH FORUM OR THE TAKING OF ANY
                                                                ACTION UNDER THIS AGREEMENT TO ENFORCE SAME IN ANY OTHER APPROPRIATE
                                                                FORUM OR JURISDICTION.



 


		14.	Amendments;
                                                                 etc.



 


No
amendment or waiver of any provision of this Agreement nor consent to any departure by Pledgor herefrom shall in any event be
effective unless the same shall be in writing and signed by Secured Party, and then such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given. No failure on the part of Secured Party to exercise,
and no delay in exercising any right under this Agreement, any other Credit Document, or otherwise with respect to any of the
secured Obligations, shall operate as a waiver thereof; nor shall any single or partial exercise of any right under this Agreement,
any other Credit Document, or otherwise with respect to any of the Secured Obligations preclude any other or further exercise
thereof or the exercise of any other right. The remedies provided for in this Agreement or otherwise with respect to any of the
Secured Obligations are cumulative and not exclusive of any remedies provided by law.


 


		15.	Notices.



 


Unless
otherwise specifically provided herein, all notices shall be in writing addressed to the respective party as set forth below;
and may be personally served, faxed, emailed, or sent by overnight courier service or United States mail:


 


	 	If to Pledgor:	Patrick Imeson
	 	 	Elkhorn Goldfields LLC
	 	 	1610 Wynkoop Street, Suite 400
	 	 	Denver, Colorado 80202
	 	 	Patrick.imeson@bdfin.com


 



    	 



    	 



    

 


	 	With copies to:	Steven N. Levine, Esq.
	 	 	Messner & Reeves, LLC 
	 	 	1430 Wynkoop Street, Suite300
	 	 	Denver, CO  80202
	 	 	slevine@messner.com
	 	 	 
	 	If to Secured Party:	Gordon Snyder
	 	 	28 Middle Street, Suite 100
	 	 	Keene, NH 03431
	 	 	 
	 	With copies to:	Barrie Cowan, Attorney and Counselor
	 	 	595 Laidley Street
	 	 	San Francisco, CA 94131
	 	 	cowan@barriecowan.com


 


Any
notice given pursuant to this section shall be deemed to have been given: (a) if delivered in person, when delivered; (b) if delivered
by fax, on the date of transmission if transmitted on a Business Day before 4:00 p.m. at the place of receipt, or, if not, on
the next succeeding Business Day; (c) if delivered by overnight courier, two (2) days after delivery to such courier properly
addressed; or (d) if by United States mail, four (4) Business Days after depositing in the United States mail, with postage prepaid
and properly addressed. Any party hereto may change the address or fax number at which it is to receive notices hereunder by notice
to the other party in writing in the foregoing manner.


 


		16.	Continuing
                                                                 Security Interest.



 


This
Agreement shall create a continuing security interest in the Collateral and shall: (a) remain in full force and effect until the
indefeasible payment in full of the Secured Obligations, including the cash collateralization, expiration, or cancellation of
all Secured Obligations, if any, consisting of letters of credit, and the full and final termination of any commitment to extend
any financial accommodations under the Loan Agreement; (b) be binding upon Pledgor and its successors and assigns; and (c) inure
to the benefit of Secured Party and its successors, transferees, and assigns. Upon the indefeasible payment in full of the Secured
Obligations, including the cash collateralization, expiration, or cancellation of all Secured Obligations, if any, consisting
of letters of credit, and the full and final termination of any commitment to extend any financial accommodations under the Loan
Agreement, the security interests granted herein shall automatically terminate and all rights to the Collateral shall revert to
Pledgor. Upon any such termination, Secured Party will, at Pledgor’s expense, execute and deliver to Pledgor such documents
as Pledgor shall reasonably request to evidence such termination. Such documents shall be prepared by Pledgor and shall be in
form and substance reasonably satisfactory to Secured Party.


 



    	 



    	 



    

 


		17.	Security
                                                                 Interest Absolute.



 


To
the maximum extent permitted by law, all rights of Secured Party, all security interests hereunder, and all obligations of Pledgor
hereunder, shall be absolute and unconditional irrespective of:


 


		(a)	Any
                                                                lack of validity or enforceability of any of the Secured Obligations
                                                                or any other agreement or instrument relating thereto, including
                                                                any of the Transaction Documents;



 


		(b)	Any
                                                                change in the time, manner, or place of payment of, or in any
                                                                other term of, all or any of the Secured Obligations, or any other
                                                                amendment or waiver of or any consent to any departure from any
                                                                of the Credit Documents, or any other agreement or instrument
                                                                relating thereto;



 


		(c)	Any
                                                                exchange, release, or non-perfection of any other collateral,
                                                                or any release or amendment or waiver of or consent to departure
                                                                from any guaranty for all or any of the Secured Obligations; or



 


		(d)	Any
                                                                other circumstances that might otherwise constitute a defense
                                                                available to, or a discharge of, Pledgor.



 


		18.	Headings.



 


Section
and subsection headings in this Agreement are included herein for convenience of reference only and shall not constitute a part
of this Agreement or be given any substantive effect.


 


		19.	Severability.



 


In
case any provision in or obligation under this Agreement shall be invalid, illegal or unenforceable in any jurisdiction, the validity,
legality and enforceability of the remaining provision or obligations, or of such provision or obligation in any other jurisdiction,
shall not in any way be affected or impaired thereby.


 


		20.	Counterparts;
                                                                 Facsimile Execution.



 


This
Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall
constitute one and the same Agreement. Delivery of an executed counterpart of this Agreement by facsimile shall be equally as
effective as delivery of an original executed counterpart of this Agreement. Any party delivering an executed counterpart of this
Agreement by facsimile also shall deliver an original executed counterpart of this Agreement but the failure to deliver an original
executed counterpart shall not affect the validity, enforceability, or binding effect hereof.


 



    	 



    	 



    

 


		21.	Waiver
                                                                 of Marshaling. 



 


Each
of Pledgor and Secured Party acknowledges and agrees that in exercising any rights under or with respect of the Collateral: (a)
Secured Party is under no obligation to marshal any Collateral; (b) it may, in its absolute discretion, realize upon the Collateral
in any order and in any manner it so elects; and (c) may, in its absolute discretion, apply the proceeds of any or all of the
Collateral to the Secured Obligations in any order and in any manner it so elects. Pledgor and Secured Party waive any right to
require the marshaling of any of the Collateral.


 


		22.	Waiver
                                                                 of Jury Trial.



 


PLEDGOR
AND SECURED PARTY HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT
OF THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS,
AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. PLEDGOR AND SECURED PARTY REPRESENT THAT EACH HAS REVIEWED THIS WAIVER AND EACH
KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION,
A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.


 


[SIGNATURES
ON FOLLOWING PAGE(S)]


 



    	 



    	 



    

 


IN
WITNESS WHEREOF, Pledgor and Secured party have caused this Agreement to be duly executed and delivered by their officers thereunto
duly authorized as of the date first written above.


 


PLEDGOR:


Elkhorn Goldfields,
LLC


 


	/s/ Robert Trenaman	 
	By: Robert Trenaman	 
	Title: President	 


 


SECURED
PARTY:


 


Gordon
Snyder, as Administrative Agent


 


	By:	/s/ Gordon Snyder	 
	Title:	Administrative Agent	 


 



    	 



    	 



    

 


Schedule
1


 


Pledged
Interests


 


		 		 	 		 	Number of	 	 	Certificate
	Name of	 	Jurisdiction of	 	 		 	Shares/Units	 	 	Number(s) 
	Issuer	 	Organization	 	 	Type of Interest	 	(if applicable)	 	 	(if any) 
	Eastern Resources, Inc. 	 	Delaware 	 	 	Series A Preferred Shares 	 	10,000,000 	 	 	TO COME