AND ERECT THEREON SUCH
MINING FACILITIES AS THEY MAY CONSIDER ADVISABLE;
(D)
REMOVE FROM THE CLAIMS ORE OR MINERAL PRODUCTS
FOR THE PURPOSE OF BULK SAMPLING, PILOT PLANT OR TEST OPERATIONS, THE BENEFIT OF
WHICH SHALL ACCRUE TO THE OPTIONEE SUBJECT TO PAYMENT OF THE NSR; AND
(E)
DO EVERYTHING NECESSARY OR DESIRABLE TO CARRY
OUT AN EXPLORATION PROGRAM ON THE CLAIMS AND TO DETERMINE THE MANNER OF
EXPLORATION AND DEVELOPMENT OF THE CLAIMS AND, WITHOUT LIMITING THE GENERALITY
OF THE FOREGOING, THE RIGHT, POWER AND AUTHORITY TO:
6
I)
REGULATE ACCESS TO THE CLAIMS, SUBJECT
ONLY TO THE RIGHT OF THE OPTIONOR AND THEIR REPRESENTATIVES TO HAVE ACCESS TO
THE CLAIMS AT ALL REASONABLE TIMES FOR THE PURPOSE OF INSPECTING WORK BEING DONE
THEREON BUT AT THEIR OWN RISK AND EXPENSE.
II)
EMPLOY AND ENGAGE SUCH EMPLOYEES, AGENTS
AND INDEPENDENT CONTRACTORS AS THEY MAY CONSIDER NECESSARY OR ADVISABLE TO CARRY
OUT ITS DUTIES AND OBLIGATIONS HEREUNDER; AND
III)
CONDUCT SUCH TITLE EXAMINATIONS AND CURE
SUCH TITLE DEFECTS AS MAY BE ADVISABLE IN THE REASONABLE JUDGMENT OF THE
OPTIONEE.
DUTIES AND OBLIGATIONS
8.
THE OPTIONEE SHALL HAVE THE DUTIES AND
OBLIGATIONS TO:
(A)
KEEP THE CLAIMS FREE AND CLEAR OF ALL LIENS AND ENCUMBRANCES
ARISING FROM ITS OPERATIONS HEREUNDER (EXCEPT LIENS CONTESTED IN GOOD FAITH BY
THE OPTIONEE) AND IN GOOD STANDING BY THE DOING AND FILING, OR PAYMENT IN LIEU
THEREOF, OF ALL NECESSARY ASSESSMENT WORK AND PAYMENT OF ALL TAXES REQUIRED TO
BE PAID AND BY THE DOING OF ALL OTHER ACTS AND THINGS AND THE MAKING ALL OTHER
PAYMENTS REQUIRED TO BE MADE WHICH MAY BE NECESSARY IN THAT REGARD, AND ON A
TIMELY BASIS AS REQUIRED BY LAW TO MAINTAIN OWNERSHIP, DO ALL SUCH ACTS AND
THINGS NECESSARY TO CONVERT THE EXPLORATION CLAIMS TO EXPLOITATION CLAIMS:
(B)
CONDUCT ALL EXPLORATION ON THE CLAIMS IN ACCORDANCE WITH CANADIAN
MINING INDUSTRY GENERALLY ACCEPTED EXPLORATION PRACTICES AND ALL APPLICABLE
LAWS, RULES AND REGULATIONS, INCLUDING WITHOUT LIMITATION THE MEXICAN MINING
CODE (LEY MINERA), AND IN SUCH MANNER AS WILL NOT RESULT IN ANY ENVIRONMENTAL
DEGRADATION OF THE CLAIMS OR ANY OF THEM OR IN ANY IMPEDIMENT TO THE FUTURE
DEVELOPMENT AND EXPLOITATION OF THE MINERAL RESOURCES IN, ON OR UNDER THE CLAIMS
OR ANY OF THEM;
(C)
PERMIT THE OPTIONOR AND THEIR REPRESENTATIVES, DULY AUTHORIZED BY
THEM, IN WRITING, AT THEIR OWN RISK AND EXPENSE, ACCESS TO THE CLAIMS AT ALL
REASONABLE TIMES AND TO ALL RECORDS PREPARED BY THE OPTIONEE IN CONNECTION WITH
EXPLORATION OF THE CLAIMS, MINING ACTIVITY ON THE CLAIMS AND CALCULATION OF THE
NSR. THE OPTIONEE SHALL PREPARE AND DELIVER TO THE OPTIONOR AT REASONABLE
INTERVALS, BUT IN ANY EVENT NOT LESS FREQUENTLY THEN ONCE EACH CALENDAR YEAR, A
WRITTEN REPORT (INCLUDING COPIES OF ANY TECHNICAL REPORTS) ON ALL EXPLORATION
AND MINING ACTIVITIES CONDUCTED ON THE CLAIMS BY THE OPTIONEE;
(D)
ARRANGE FOR AND MAINTAIN WORKER'S COMPENSATION OR EQUIVALENT
COVERAGE FOR ALL ELIGIBLE EMPLOYEES ENGAGED BY OPTIONEE IN ACCORDANCE WITH LOCAL
STATUTORV REQUIREMENTS, AND GENERAL