LIABILITY INSURANCE COVERAGE WITH PER CLAIM
AND AGGREGATE AMOUNT EQUIVALENT TO AT LEAST US$ 1,000,000:
(E)
MAINTAIN TRUE AND CORRECT BOOKS, ACCOUNTS AND RECORDS OF
OPERATIONS HEREUNDER; AND
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(F)
REFRAIN FROM CONDUCTION OR ALLOWING TO BE
CONDUCTED ON THE CLAIMS ANY ACTIVITY CONSTITUTING EXPLOITATION PRIOR TO PAYMENT
IN FULL OF ALL AMOUNTS PAYABLE UNDER PARAGRAPH 2 (B) OF THIS AGREEMENT, WHETHER
OR NOT THE SAME MAY BE DUE AT THE TIME OF DETERMINATION OF WHETHER SUCH
EXPLOITATION ACTIVITY IS PERMITTED UNDER THIS PARAGRAPH.
NET SMELTER RETURY BUY-DOWN
9.
THE OPTIONEE IS HEREBY GRANTED BY THE
OPTIONOR THE RIGHT TO BUY UP TO A 100% INTEREST IN THE 2% NET SMELTER RETURN
("NSR") ROYALTY RESERVED UNTO THE OPTIONOR, BY MAKING A ONE TIME PAYMENT TO THE
OPTIONOR AT ANY TIME. THE AMOUNT OF THE PAYMENT REQUIRED TO PURCHASE THEE ENTIRE
NSR SHALL BE US $1,000,000.
IF A LESSER PERCENTAGE OF THE NSR IS TO BE
PURCHASED, THE US $1,000,000 PAYMENT SHALL BE PRO RATED ACCORDINGLY.
FOR
EXAMPLE, IF ONE HALF OF THE NSR IS INTENDED TO BE PURCHASED, THE REQUIRED
PURCHASE PRICE SHALL BE ONE HALF OF US $1,000,000.
9.1
ON EXERCISE OF THE BUY-DOWN GRANTED BY
SUBSECTION 9.1, THE PARTIES SHALL EXECUTE ALL SUCH DOCUMENTATION REASONABLY AS
MAY BE REQUIRED TO COMPLETE THE SAME.
INFORMATION
10.
OPTIONEE ACKNOWLEDGES THAT ALL DATA, REPORTS,
DRILL CORE, MAPS AND SIMILAR INFORMATION CONCERNING THE CLAIMS AVAILABLE TO THE
OPTIONOR IS IN THE POSSESSION OF WAYNE ROBERTS, VANCOUVER, BC, CANADA. TO THE
EXTENT SUCH INFORMATION HAS NOT BEEN MADE AVAILABLE TO THE OPTIONEE, THE
OPTIONOR UPON REQUEST BY THE OPTIONEE WILL USE ITS REASONABLE BEST EFFORTS TO
HAVE SUCH INFORMATION MADE AVAILABLE TO THE OPTIONEE BY MR. ROBERTS. IN THE
EVENT THAT THE OPTIONEE FAILS TO EXERCISE THE OPTION, ALL SUCH DATA, REPORTS,
DRILL CORE, MAPS AND OTHER INFORMATION PROVIDED TO THE OPTIONEE SHALL BE
RETURNED TO THE OPTIONOR.
TERMINATION
11.
IN THE EVENT OF DEFAULT IN THE PERFORMANCE OF
THE REQUIREMENTS OF SECTION 2, THEN SUBJECT TO THE PROVISIONS OF SECTION 12
HEREOF, THE OPTION AND THIS AGREEMENT SHALL TERMINATE.
11.2
THE OPTIONEE SHALL HAVE THE RIGHT TO TERMINATE THIS
AGREEMENT BY GIVING 30 DAYS` WRITTEN NOTICE OF SUCH TERMINATION TO THE OPTIONOR
AND UPON THE EFFECTIVE DATE OF SUCH TERMINATION THIS AGREEMENT SHALL BE OF NO
FURTHER FORCE AND EFFECT EXCEPT THE OPTIONEE SHALL BE REQUIRED TO SATISFY ANY
OBLIGATIONS WHICH HAVE ACCRUED UNDER THE PROVISIONS OF THIS AGREEMENT WHICH MAY
NOT HAVE THEN SATISFIED.
11.3
NOTWITHSTANDING, ANY OTHER PROVISIONS OF THIS
AGREEMENT, IN THE EVENT OF TERMINATION OF THIS AGREEMENT, THE OPTIONEE SHALL:
(A)
DELIVER TO THE OPTIONOR ANY AND ALL REPORTS,
SAMPLES, DRILL CORES, MAPS, AND ENGINEERING, GEOLOGICAL, METALLURGICAL AND OTHER
DATA OF ANY KIND WHATSOEVER PERTAINING TO THE CLAIMS WHICH HAVE NOT BEEN
PREVIOUSLY DELIVERED TO THE OPTIONEE;
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(B)
PERFORM OR SECURE THE PERFORMANCE OF ALL
RECLAMATION AND ENVIRONMENTAL REHABILITATION AS MAY BE REQUIRED BY ALL
APPLICABLE LEGISLATION.
(C)
UPON NOTICE FROM THE OPTIONOR, REMOVE ALL