Document:

Exhibit

GUARANTY
This GUARANTY (the “Guaranty”) is made and entered into as of July 25, 2016, by and among COMSTOCK MINING INC., a Nevada corporation (“CMI”), COMSTOCK MINING LLC, a Nevada limited liability company and wholly-owned subsidiary of CMI (“CML”), COMSTOCK REAL ESTATE INC., a Nevada corporation and wholly-owned subsidiary of CMI (“CRE” and together with CMI and CML, the “Guarantors”), and GF COMSTOCK 1 LP, a Delaware limited partnership (“Lender”).
RECITALS
Comstock Industrial LLC, a Nevada limited liability company and wholly-owned subsidiary of CMI (“Borrower”) and Lender are parties to that certain Loan Agreement, dated as of July 25, 2016 (the “Loan Agreement”) providing for Borrower to obtain a loan (the “Loan”) from Lender in the original principal amount of $3,250,000 for the purpose of acquiring certain real property.
It is a condition of the consummation of the transactions contemplated by the Loan Agreement that the Guarantors enter into and deliver this Guaranty.
The transactions contemplated by the Loan Agreement are beneficial to the Guarantors and it is in consideration for such benefits that the Guarantors agree to enter into this Guaranty.  
NOW, THEREFORE, in consideration of the representations, warranties, covenants and agreements herein contained, and intending to be legally bound hereby, the parties hereto agree as follows:  
Defined terms used herein shall have the meaning set forth in the Loan Agreement if not defined herein.  
ARTICLE I
GUARANTEE
Section 1.1. The Guarantee. The Guarantors hereby jointly and severally guarantee as a primary obligor and not as a surety to Lender the prompt payment in full when due (whether at stated maturity, by acceleration or otherwise) of the principal of and interest (including any interest, fees, costs or charges that would accrue but for the provisions of the United States Federal Bankruptcy Code of 1978, as amended or supplemented from time to time (the “Bankruptcy Code”) after any bankruptcy or insolvency petition under the Bankruptcy Code) on the Loan from time to time owing to Lender by Borrower or otherwise owing under the Loan Agreement, in each case strictly in accordance with the terms thereof (such obligations being herein collectively called the “Guaranteed Obligations”). The Guarantors hereby jointly and severally agree that if Borrower shall fail to pay in full when due (whether at stated maturity, by acceleration or otherwise) any of the Guaranteed Obligations, the Guarantors will promptly pay the same, upon notice, and that in the case of any extension of time of payment or renewal of any of the Guaranteed Obligations, the same will be promptly paid in full when due (whether at extended maturity, by acceleration or otherwise) in 

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accordance with the terms of such extension or renewal. Subject to Section 1.3, the obligations of the Guarantors under this Section 1.1 shall terminate when all Guaranteed Obligations have been paid in full.
Section 1.2. Obligations Unconditional. The obligations of the Guarantors under Section 1.1 are absolute, irrevocable and unconditional, joint and several, irrespective of the value, genuineness, validity, regularity or enforceability of the obligations of Borrower under the Loan Agreement or any other Loan Document, or any substitution, release or exchange of any other guarantee of or security for any of the Guaranteed Obligations, and, to the fullest extent permitted by applicable law, irrespective of any other circumstance whatsoever that might otherwise constitute a legal or equitable discharge or defense of a surety or Guarantor (except for payment in full). Without limiting the generality of the foregoing, the occurrence of any one or more of the following shall not alter or impair the liability of the Guarantors hereunder, which shall remain absolute, irrevocable and unconditional under any and all circumstances as described above:
(i) at any time or from time to time, upon notice to the Guarantors, the time for any performance of or compliance with any of the Guaranteed Obligations shall be extended, or such performance or compliance shall be waived;  
(ii) any of the acts mentioned in any of the provisions of the Loan Agreement or any other Loan Document shall be done or omitted;
(iii) the maturity of any of the Guaranteed Obligations shall be accelerated, or any of the Guaranteed Obligations shall be amended in any respect, or any right under the Loan Agreement or any other Loan Document shall be amended or waived in any respect or any other guarantee of any of the Guaranteed Obligations or any security therefore shall be released or exchanged in whole or in part or otherwise dealt with;
(iv) any other Guarantor shall be released; or  
(v) any other Person shall become a guarantor of the Guaranteed Obligations.  
To the fullest extent permitted by applicable law, the Guarantors hereby expressly waive diligence, presentment, demand of payment, protest and any requirement that Lender thereof exhaust any right, power or remedy or proceed against Borrower under the Loan Agreement or any other Loan Document, or against any other Person under any other guarantee of, or security for, any of the Guaranteed Obligations.  To the fullest extent permitted by applicable law, the Guarantors waive any and all notice of the creation, renewal, extension, waiver, termination or accrual of any of the Guaranteed Obligations and notice of or proof of reliance by Lender upon this guarantee or acceptance of this guarantee, and the Guaranteed Obligations, and any of them, shall conclusively be deemed to have been created, contracted or incurred in reliance upon this Guaranty, and all dealings between Borrower and Lender, shall likewise be conclusively presumed to have been had or consummated in reliance upon this Guaranty. This Guaranty shall be construed as a continuing, absolute, irrevocable and unconditional guarantee of payment without regard to any right of offset with respect to the Guaranteed Obligations at any time or from time to time held by Lender, and the obligations and liabilities of the Guarantors hereunder shall not be conditioned or contingent 

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upon the pursuit by Lender or any other Person at any time of any right or remedy against Borrower or against any other Person which may be or become liable in respect of all or any part of the Guaranteed Obligations or against any collateral security or guarantee therefore or right of offset with respect thereto. This Guaranty shall remain in full force and effect and be binding in accordance with and to the extent of its terms upon the Guarantors and the successors and assigns thereof, and shall inure to the benefit of Lender, and its successors and assigns. 
Section 1.3. Reinstatement. The obligations of the Guarantors under this Guaranty shall be automatically reinstated if and to the extent that for any reason any payment by or on behalf of Borrower in respect of the Guaranteed Obligations is rescinded or must be otherwise restored by any holder of any of the Guaranteed Obligations, whether as a result of any proceedings in bankruptcy or reorganization or otherwise. The Guarantors jointly and severally agree that they will indemnify Lender on demand for all reasonable costs and expenses (including reasonable fees of counsel) incurred by Lender in connection with such rescission or restoration, including any such costs and expenses incurred in defending against any claim alleging that such payment constituted a preference, fraudulent transfer or similar payment under any bankruptcy, insolvency or similar law, other than any costs or expenses resulting from the gross negligence or bad faith of Lender.
Section 1.4. Subrogation; Subordination. Each Guarantor hereby agrees that until the indefeasible payment and satisfaction in full in cash of all Guaranteed Obligations and the expiration and termination of the obligations of Borrower under the Loan Agreement it shall not exercise any right or remedy arising by reason of any performance by it of its guarantee in Section 1.1, whether by subrogation or otherwise, against Borrower or any other Guarantor of any of the Guaranteed Obligations or any security for any of the Guaranteed Obligations. The payment of any amounts due with respect to any indebtedness of Borrower or any other Guarantor now or hereafter owing to any Guarantor by reason of any payment by such Guarantor under this Guaranty is hereby subordinated to the prior indefeasible payment in full in cash of the Guaranteed Obligations. Each Guarantor agrees that it will not demand, sue for or otherwise attempt to collect any such indebtedness of Borrower to such Guarantor until the Guaranteed Obligations shall have been indefeasibly paid in full in cash.  
Section 1.5. Acceleration. The Guarantors jointly and severally agree that, as between the Guarantors and Lender, the obligations of Borrower under the Loan Agreement may be declared to be forthwith due and payable as provided in Article 8 of the Loan Agreement (and shall be deemed to have become automatically due and payable in the circumstances provided therein) for purposes of Section 1.1, notwithstanding any stay, injunction or other prohibition preventing such declaration (or such obligations from becoming automatically due and payable) as against Borrower and that, in the event of such declaration (or such obligations being deemed to have become automatically due and payable), such obligations (whether or not due and payable by Borrower) shall forthwith become due and payable by the Guarantors for purposes of Section 1.1.  
Section 1.6. Instrument for the Payment of Money. Each Guarantor hereby acknowledges that the guarantee in this Guaranty constitutes an instrument for the payment of money, and consents and agrees that Lender, at its sole option, in the event of a dispute by such Guarantor in the payment 

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of any moneys due hereunder, shall have the right to bring a motion-action or other like proceeding or action under applicable Nevada law.

Section 1.7. Continuing Guarantee. The guarantee in this Guaranty is a continuing guarantee, and shall apply to all Guaranteed Obligations whenever arising.  
Section 1.8. General Limitation on Guarantee Obligations. In any action or proceeding involving any state corporate law, or any state, federal or foreign bankruptcy, insolvency, reorganization or other law affecting the rights of creditors generally, if the obligations of any Guarantor under Section 1.1 would otherwise be held or determined to be void, voidable, invalid or unenforceable, or subordinated to the claims of any other creditors on account of the amount of its liability under Section 1.1, then, notwithstanding any other provision to the contrary, the amount of such liability shall, without any further action by such Guarantor, Lender or any other Person, be automatically limited and reduced to the highest amount that is valid and enforceable and not subordinated to the claims of other creditors as determined in such action or proceeding.  
Section 1.9. Limitation on Guaranty Amount. The obligations of the Guarantor hereunder shall be limited to an aggregate amount that is equal to the largest amount that would not render the obligations of the Guarantor hereunder subject to avoidance under Section 548 of the United States Bankruptcy Code or any comparable provisions of applicable law.  
Section 1.10. Additional Guarantors. Upon Borrower creating or acquiring any subsidiary after the date hereof, each such subsidiary shall become a Guarantor by executing a counterpart signature page to this Agreement. At such time, Borrower shall revise Schedule A accordingly and such subsidiary shall have the rights and obligations of a Guarantor hereunder.  
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE GUARANTORS
Each Guarantor hereby severally, and not jointly, represents and warrants to Lender, as of the date hereof as follows:  
Section 2.1. Organization; Authorization; Enforceability. Such Guarantor is duly organized, validly existing and in good standing under the laws of the State of Nevada and has all requisite power and authority to own, lease and operate its  properties and assets and to carry on its business as it is now being conducted and as currently proposed to be conducted. Such Guarantor has all the necessary power and authority to execute, deliver and perform its obligations under this Guaranty and has taken all action necessary to authorize the execution, delivery and performance by it of this Guaranty and to consummate the transactions contemplated hereby and in the Loan Agreement. No other proceedings on the part of such Guarantor are necessary for such authorization, execution, delivery and consummation. Such Guarantor has duly executed and delivered this Guaranty. The execution, delivery and performance of the transactions contemplated by this Guaranty and compliance with their provisions by the such Guarantor will not violate any provision of law and 

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will not conflict with or result in any breach of any of the terms, conditions or provisions of, or constitute a default under, or require a consent or waiver under, the governing and/or organizational documents of the Guarantor, or any indenture, lease, agreement or other instrument to which the Guarantor is a party or by which it or any of its properties is bound. This Guaranty constitutes a legal, valid and binding obligation of such Guarantor, except to the extent that its enforceability may be subject to applicable bankruptcy, insolvency, reorganization or similar laws affecting the enforcement of creditors’ rights generally and to general equitable principles.
ARTICLE III
COVENANTS
Section 3.1. Covenants. Each Guarantor covenants and agrees not to take any action that would cause Borrower to take any action prohibited by the covenants set forth in Article 5 of the Loan Agreement. 
ARTICLE IV
MISCELLANEOUS
Section 4.1. Termination. This Guaranty shall terminate upon the satisfaction in full by Borrower or the Guarantors of all of the Guaranteed Obligations.  
Section 4.2. Governing Law. This Agreement shall be governed by, interpreted under, and construed in accordance with the laws of the state where the Property is located (without giving effect to rules regarding conflict of laws)..  
Section 4.3. Modifications and Amendments. No amendment, modification or termination of this Guaranty shall be binding unless executed in writing by each Guarantor and Lender.  
Section 4.4. Waivers and Extensions. Lender may waive any condition, right, breach or default under this Guaranty, provided that such waiver will not be effective against Lender unless it is in writing, is signed by Lender, and specifically refers to this Guaranty. Waivers may be made in advance or after the right waived has arisen or the breach or default waived has occurred. Any waiver may be conditional. No waiver of any breach of any agreement or provision herein contained shall be deemed a waiver of any preceding or succeeding breach thereof nor of any other agreement or provision herein contained. No waiver or extension of time for performance of any obligations or acts shall be deemed a waiver or extension of the time for performance of any other obligations or acts.  
Section 4.5. Severability. This Guaranty shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall not affect the validity or enforceability of this Guaranty or of any other term or provision hereof. Furthermore, in lieu of any such invalid or unenforceable term or provision, the parties hereto intend that there shall be added as a part of this Guaranty a provision as similar in terms to such invalid or unenforceable provision as may be possible and be valid and enforceable.  

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Section 4.6. Counterparts. This Guaranty may be executed in counterparts, each of which shall be deemed an original, but all of which taken together shall constitute one and the same instrument. Any signature page delivered by facsimile or .pdf or other electronic means shall be binding to the same extent as an original signature page, with regard to any agreement subject to the terms hereof or any amendment thereto. Any party who delivers such a signature page agrees to later deliver an original counterpart to any party which requests it.  
Section 4.7. Further Assurances. As between the Guarantors and Lender, each party hereto, upon the request of any other party hereto, shall do all such further acts and execute, acknowledge and deliver all such further instruments and documents as may be necessary or desirable to carry out the transactions contemplated by this Guaranty.  
Section 4.8. Notices. All notices, consents, approvals and requests required or permitted hereunder shall be given in writing and shall be effective for all purposes if sent by (a) hand delivery, with proof of attempted delivery, (b) certified or registered United States mail, return receipt requested, postage prepaid, or (c) expedited prepaid delivery service, either commercial or United States Postal Service, with proof of attempted delivery, addressed to the parties as follows:
		
	If to Lender:
	GF Comstock 1 LP 
c/o Withers Bergman LLP 
430 Park Avenue, 10th Floor 
New York, New York 10022-3505 
Attention:  Clyde W. Tinnen

		
	If to the Guarantors:
	Comstock Mining Inc. 
1200 American Flat Road, P.O. Box 1118 
Virginia City, Nevada 89440 
Attention:  Corrado DeGasperis

A party receiving a notice which does not comply with the technical requirements for notice under this Section 4.8 may elect to waive any deficiencies and treat the notice as having been properly given.  A notice shall be deemed to have been given:  (a) in the case of hand delivery, at the time of delivery; (b) in the case of registered or certified mail, when delivered or the first attempted delivery on a Business Day; or (c) in the case of expedited prepaid delivery, upon the first attempted delivery on a Business Day.  Communications between Borrower and Lender as to routine servicing matters, including any consents granted by Lender, may be made by email provided that the recipient acknowledges having received such email (with an automatic “read receipt” not constituting acknowledgment of an email for purposes hereof).  Notice for any party may be given by its respective counsel.  Borrower acknowledges and agrees that the failure to provide a courtesy copy of any notice herein shall not void the effectiveness of such notice to Borrower.
[Signature on the following page]

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IN WITNESS WHEREOF, the parties hereto have caused this Guaranty to be duly executed by their duly authorized representatives, all as of the day and year first above written.
LENDER:
GF COMSTOCK 1 LP
 
By:   /s/ John Clark Gillam     
Name: John Clark Gillam     
Title: Co-Manager    
By:  /s/ Daniel Freuman     
Name: Daniel Freuman     
Title: Co-Manager    
GUARANTORS:
COMSTOCK MINING INC. 
		
	By:
	/s/ Corrado DeGasperis     
Name: Corrado DeGasperis     
Title:    CEO and President

COMSTOCK MINING LLC 
		
	By:
	/s/ Corrado DeGasperis     
Name: Corrado DeGasperis     
Title:    Manager

[Signature page to Guaranty]

    

COMSTOCK REAL ESTATE INC. 
		
	By:
	By:    /s/ Corrado DeGasperis     
Name: Corrado DeGasperis     
Title:    President

 
 
 
 
[Signature page to Guaranty]

    

Schedule A
Guarantors
Comstock Mining Inc.
Comstock Mining LLC
Comstock Real Estate Inc.Lexaria Bioscience Corp.: Exhibit 10.1 - Filed by newsfilecorp.com

LOAN AGREEMENT 

THIS AGREEMENT made the 25nd day of July, 2016 

AMONG: 

C.A.B. Financial Services Ltd

156 Valleyview Road 
Kelowna BC V1X 3M4 

(herein called the “Lender”) 

OF THE FIRST PART

AND: 

LEXARIA BIOSCIENCE CORP., of

950 – 1130 West Pender Street, 
Vancouver BC V6E 4A4, 
Fax 604 602
1625 

(herein called the “Company”) 

OF THE SECOND PART 

WHEREAS: 

A.          
This Loan Agreement (the “Loan Agreement”) is entered into this date by and
between the Lender and the Company on a fifteen month term, the first 3 of which
are interest free and payment free. 

B.          
The purpose of this Loan Agreement is to set out terms of the arrangement by
which Lender agrees to make a loan of US$50,000.00 (“Loan”) available to the
Company.

1.          
DEFINITIONS 

1.1         
“Collateral” means the collateral in which the Lender is granted a security
interest by this Agreement proportionate to the loan extended by the Lender and
which shall include the property listed in Schedule “B”, and all proceeds,
products and accounts thereof, including, without limitation, all proceeds from
the sale or transfer of the Collateral and of insurance covering the same and of
any tort claims in connection therewith, and all dividends, interest, cash,
notes, securities, equity interest or other property at any time and from time
to time acquired, receivable or otherwise distributed in respect of, or in
exchange for the Collateral, subject only to any preferred interest in this
Collateral previously granted prior to the date of this Agreement. 

1.2         
“Indebtedness” means all loans and advances made or which may be made by the
Lender to the Company and Interest thereon and all costs, charges and expenses
of or incurred by the Lender in connection with any Securities and in connection
with any property covered by or comprised in the Securities, whether in protecting, preserving,
realizing or collecting any Securities or property aforesaid or attempting so to
do or otherwise and all other obligations and liabilities, present or future,
direct or indirect, absolute or contingent, mature or not, of the Company to the
Lender arising under or by virtue of this Agreement, the Securities or otherwise
howsoever. 

- 2 -

1.3         
  “Interest” will be simple interest at 8% per annum with a 3-month
interest-free period at the beginning of the Loan Agreement. 

1.4         
“Principal” means the aggregate principal amount of money loaned to the Company
by the Lender of US$50,000.00 dollars. 

1.5         
“Securities” means the securities referred to in Article 3 or any renewal
thereof or substitution therefore. 

2.          
TERMS OF THE LOAN 

2.1          The
Lender will lend to the Company, and the Company will borrow from the Lender by
way of one advance to be evidenced by a promissory note in the form attached
hereto as Schedule “A”, the Principal sum of fifty thousand dollars (USD)
subject to the terms and conditions of this Agreement and the Securities. 

2.2          For
value received, Company promises to pay to Lender beginning on the
15th day of the fourth month and continuing through to the
15th day of the fifteenth month, twelve equal monthly payments of
$4,500.00 to be applied against the principal and interest amount outstanding
from the date of the Loan Agreement; interest understood to be calculated simply
at the rate of 8% on the outstanding principal balance. If not repaid before
maturity, a total of $4,000.00 in interest will be paid. The Company will use
best efforts to repay the Loan in full as quickly as possible, if in the sole
judgement of the Company it is able to do so without creating financing hardship
for itself. 

2.3         
Notwithstanding the above the Company may repay at any time any or all of the
Principal then outstanding and accrued and unpaid Interest on giving 20 days
notice to the Lender. In this event the Company may elect to repay the Principal
at any time in advance of the Maturity Date. 

2.4          In
the event the Company sells, pledges, or hypothecates more than 20% of its
assets (measured by book value on the Company’s quarterly financial statements)
at any time while any principal balance remains unpaid, the entire principal
balance is then due and payable immediately. 

3.          
SECURITY FOR THE LOAN 

3.1          As an
inducement for the Lender to extend the loans as evidenced herein and to secure
their complete and timely payment, performance and discharge in full, as the
case may be, the Debtor hereby unconditionally and irrevocably pledges, grants
and hypothecates to the Lender a continuing and perfected security interest in
and to, a lien upon and a right of set-off against all of their respective right, title and interest of
whatsoever kind and nature in and to, the Collateral (the “Security Interest”)
as shown in Schedule “B”.

- 3 -

4.          
AFFIRMATIVE COVENANTS OF THE COMPANY 

4.1          At
all times while any Principal or Interest on the Loan is outstanding, the
Company will: 

	 	(a) 	
      maintain the assets being the subject of the Securities
      in good repair;

	 	 	 
	 	(b) 	
      keep true records and books of account in which full,
      true and correct entries will be made in accordance with generally
      accepted accounting principles consistently applied throughout the period
      involved, and maintain adequate accounts and reserves for all taxes,
      including taxes on income and profits, all depreciation and amortization
      of his properties and assets and all such other reserves for contingencies
      as would normally be required in accordance with generally accepted
      accounting principles;

	 	 	 
	 	(c) 	
      permit any representative of the Lender to visit and
      inspect the properties charged by the Securities and to examine the
      Company’s books, records, leases and other documents relating thereto and
      to enquire from time to time as to particulars of any of the foregoing,
      all at such times and so often as may reasonably be requested;
  and

	 	 	 
	 	(d) 	
      forthwith upon request of the Lender execute and deliver
      to the Lender all such further and other mortgages, deeds, documents,
      matters, acts, things and insurances in law (collectively, the “Ancillary
      Items”) for the purpose of record or otherwise which the Lender may
      reasonably require to perfect the intentions and provisions of this
      Agreement; provided that the Company will not be obligated to execute and
      deliver any Ancillary Items where the execution and delivery of such
      Ancillary Items would breach the terms and conditions of any lease of real
      property existing on the date hereof to which the Company is a
    party.

5.          
DEFAULT 

5.1         
Default by the Company. The occurrence of one or more of the following
events shall constitute an “event of default”, namely: 

	 	(a) 	
      if the Company fails to make payment of the Indebtedness
      or any part thereof as and when the same comes due and payable;

	 	 	 
	 	(b) 	
      if any representation or warranty contained herein or
      otherwise made in writing to the Lender in connection with any of the
      transactions contemplated by this Agreement is found to be false or
      misleading or incorrect in any material respect on the date which it was
      made;

	 	 	 
	 	(c) 	
      if the Company defaults in the performance of or
      compliance with any term, covenant or agreement contained in this
      Agreement or in any of the Securities and the default is not remedied within twenty (20) days after
notice thereof has been given to the Company; 

- 4 -

	 	(d) 	
      the entry of a decree or order for relief by a court
      having jurisdiction in respect of the Company in an involuntary case under
      the federal bankruptcy laws, as now or hereafter constituted, or any other
      applicable federal or state bankruptcy, insolvency or other similar
      laws;

	 	 	 
	 	(e) 	
      the commencement by the Company of a voluntary case under
      the federal bankruptcy laws, as now or hereafter constituted, or any other
      applicable federal or state bankruptcy, insolvency or other similar
      laws;

	 	 	 
	 	(f) 	
      the appointment of a receiver, liquidator, assignee,
      custodian, trustee, sequestrator (or similar official) of the Company or
      for any material part of the Company’s property;

	 	 	 
	 	(g) 	
      the consent by the Company to the appointment of, or
      taking possession by, a receiver, liquidator, assignee, custodian,
      trustee, sequestrator (or similar official) of the Company or for any
      material part of the Company’s property;

	 	 	 
	 	(h) 	
      the issuance of an order for the winding up or
      liquidation of the affairs of the Company and the continuance of such
      decree, order or appointment unstayed and in effect for a period of sixty
      (60) consecutive days;

	 	 	 
	 	(i) 	
      the making by the Company of an assignment for the
      benefit of its creditors;

	 	 	 
	 	(j) 	
      the institution by or against the Company of any formal
      or informal proceeding for the dissolution or liquidation of, settlement
      of claims against or winding-up of the affairs of the Company;

	 	 	 
	 	(k) 	
      the threat by the Company of ceasing to carry on business
      or the Company ceasing to carry on business;

	 	 	 
	 	(l) 	
      the entry of a decree or order or an effective resolution
      passed for winding-up the Company;

	 	 	 
	 	(m) 	
      the entry by the Company into any reconstruction,
      reorganization, amalgamation, merger or other similar arrangement with any
      other person; or

	 	 	 
	 	(n) 	
      if any encumbrancer takes possession of the properties
      being the subject of the Securities or being financed with the Loan,
      unless the Company in good faith disputes the encumbrancer’s claim and
      non-payment does not jeopardize the title of the Company to any such
      property or any way impairs any of the Securities;
or

5.2          Upon
the occurrence of any one of these events of default, the entire amount of the
Principal and Interest then outstanding shall immediately become due and
payable. 

- 5 - 

5.3         
Lender’s delay or failure to insist upon the strict performance of the Company’s
obligations under this Loan Agreement or the Securities shall not be construed
as a waiver of Lender’s right to later require strict performance nor as a
waiver of any of Lender’s legal and equitable remedies. 

6.          
PAYMENT ON MATURITY 

6.1          On
the Maturity Date, the Company will deliver the Principal then outstanding and
any earned Interest due Lender by wire transfer to Lender’s nominated bank
account or in cash or certified cheque delivered to the address of Lender. 

7.          
NOTICES 

7.1          Any
notice, request, demand, claim, instruction, or other document to be given to
any party pursuant to this Loan Agreement shall be in writing delivered
personally or sent by mail, registered or certified, postage fully prepaid, as
follows: 

	 	(a) 	
      If to, Lender to the address set forth on the first page
      of this Loan Agreement.

	 	 	 
	 	(b) 	
      If to Company, to the addresses set forth on the first
      page of this Loan Agreement, with a copy to:

Madonald Tuskey, Corporate and
Securities Lawyers 
400-570 Granville Street 
Vancouver, BC V6C 3P1

Attention: William L. Macdonald 
Fax: 604 681 4760 

7.2          Any
party may give any notice, request, demand, claim, instruction, or other
document under this section using any other means (including expedited courier,
messenger service, telecopy, facsimile, telex, ordinary mail, or electronic
mail), but no such notice, request, demand, claim, instruction, or other
document shall be deemed to have been duly given unless and until it actually is
received by the individual for whom it is intended. Any party may change its
address for purposes of this section by giving notice of the change of address
to the other party in the manner provided in this section. 

8.          
TERMINATION 

8.1          This
Loan Agreement may, by written notice, be terminated as follows: 

	 	(a) 	
      by either the Company or the Lender if a material breach
      of any provision of this Loan Agreement has been committed by the other
      party and such breach has not been waived; or

	 	 	 
	 	(b) 	
      by mutual written consent of the Company and
    Lender.

- 6 - 

8.2          Each
Party’s right of termination is in addition to any other rights it may have
under this Loan Agreement or otherwise, and the exercise of a right of
termination will not be an election of remedies; provided, however, that if this
Loan Agreement is terminated by a party because of a breach of the Loan
Agreement by the other party or because one or more of the conditions to the
terminating party’s obligations under this Loan Agreement is not satisfied as a
result of the other party’s failure to comply with its obligations under this
Loan Agreement, the terminating party’s right to pursue all legal remedies will
survive such termination unimpaired. For greater certainty, termination of this
Loan Agreement does not release the Company from its obligations hereunder in
respect of any Principal then outstanding. 

9.          
INDEMNIFICATION 

9.1          All
representations, warranties, covenants, and obligations in this Loan Agreement,
and any other certificate or document delivered pursuant to this Loan Agreement
will survive the Loan Agreement. The right to indemnification, payment of
damages or other remedy based on such representations, warranties, covenants,
and obligations will not be affected by any investigation conducted with respect
to, or any knowledge acquired (or capable of being acquired) at any time,
whether before or after the execution and delivery of this Loan Agreement, with
respect to the accuracy or inaccuracy of or compliance with, any such
representation, warranty, covenant, or obligation. The waiver of any condition
based on the accuracy of any representation or warranty, or on the performance
of or compliance with any covenant or obligation, will not affect the right to
indemnification, payment of damages, or other remedy based on such
representations, warranties, covenants, and obligations. 

9.2          The
Company and the Lender mutually agree to indemnify and hold each other harmless
along with their respective representatives, stockholders, controlling persons,
and affiliates (collectively, the “Indemnified Persons”) for, and will pay to
the Indemnified Persons the amount of, any loss, liability, claim, damage
(including incidental and consequential damages), expense (including costs of
investigation and defense and reasonable attorneys’ fees) or diminution of
value, whether or not involving a third-party claim, arising, directly or
indirectly, from or in connection with any breach of any representation,
warrant, covenant or obligation made by the other Party in this Loan
Agreement.

10.          
GENERAL PROVISIONS 

10.1          The
Parties agree to furnish upon request to each other such further information,
and to execute and deliver to each other such other documents, and to do such
other acts and things, all as the other party may reasonably request for the
purpose of carrying out the intent of this Loan Agreement. 

10.2          The
rights and remedies of the parties to this Loan Agreement are cumulative and not
alternative. Neither the failure nor any delay by any party in exercising any
right, power, or privilege under this Loan Agreement or the documents referred
to in this Loan Agreement will operate as a waiver of such right, power, or
privilege, and no single or partial exercise of any such right, power, or
privilege will preclude any other or further exercise of such right, power, or
privilege or the exercise of any other right, power, or privilege. To the
maximum extent permitted by applicable law, (a) no claim or right arising out of
this Loan Agreement or the documents referred to in this Loan Agreement can be discharged
by one party, in whole or in part, by a waiver or renunciation of the claim or
right unless in writing signed by the other party; (b) no waiver that may be
given by a party will be applicable except in the specific instance for which it
is given; and (c) no notice to or demand on one party will be deemed to be a
waiver of any obligation of such party or of the right of the party giving such
notice or demand to take further action without notice or demand as provided in
this Loan Agreement or the documents referred to in this Loan Agreement. 

- 7 -

10.3          This
  Loan Agreement supersedes all prior agreements between the parties with respect
  to this loan and constitutes (along with the documents referred to in this Loan
  Agreement) a complete and exclusive statement of the terms of the agreement
  between the parties with respect to its subject matter. This Loan Agreement may
  not be amended except by a written agreement executed by the party to be charged
with the amendment. 

10.4         
Neither party may assign any of its rights under this Loan Agreement without the
prior consent of the other parties. This Loan Agreement will apply to, be
binding in all respects upon, and inure to the benefit of the successors and
permitted assigns of the parties. Nothing expressed or referred to in this Loan
Agreement will be construed to give any Person other than the parties to this
Loan Agreement any legal or equitable right, remedy, or claim under or with
respect to this Loan Agreement or any provision of this Loan Agreement. This
Loan Agreement and all of its provisions and conditions are for the sole and
exclusive benefit of the parties to this Loan Agreement and their successors and
assigns. 

10.5          If
any provision of this Loan Agreement is held invalid or unenforceable by any
court of competent jurisdiction, the other provisions of this Loan Agreement
will remain in full force and effect. Any provision of this Loan Agreement held
invalid or unenforceable only in part or degree will remain in full force and
effect to the extent not held invalid or unenforceable. 

10.6          This
Loan Agreement will be governed by the laws of the Province of British Columbia.

10.7          This
Loan Agreement may be signed in as many counterparts is as necessary and all
signatures so executed shall constitute one Agreement, binding on all Parties as
if each was a signatory on the original. 

- 8 - 

11.         
SIGNATURES 

11.1          IN
WITNESS WHEREOF, the parties have executed and delivered this Loan Agreement as
of the date first written above. 

	Per: 		 
	 	Chris Bunka, President of C.A.B.
      Financial Services Ltd. 

LEXARIA BIOSCIENCE CORP. 

	Per: 		 
	 	John Docherty, President and
      Authorized Signatory 

SCHEDULE “A” 

PROMISSORY NOTE 

	US$50,000.00 	July 25, 2016 

FOR VALUE RECEIVED, the undersigned (the “Borrower”) promise to
pay to C.A.B. Financial Services Ltd, 156 Valleyview Road, Kelowna, BC
V1X 3M4, (the “Lender”) the principal sum of fifty thousand USD dollars in
lawful currency of the USD (the “Principal Sum”), as herein provided.

The Principal Sum or such amount as shall remain outstanding
from time to time shall bear 8% interest thereon, both before and after each of
maturity, default and judgment commencing on the day the Principal Sum is
advanced by the Lender to the Borrower.

The Principal Sum with interest aforesaid will be paid in the
amount of $4,500.00 on the 15th of every month for twelve months,
beginning after a 3-month payment and interest-free holiday. 

Extension of time of payment of all or any part of the amount
owing hereunder at any time or times and failure of the Lender to enforce any of
its rights or remedies hereunder shall not release the Borrower from its
obligations hereunder or constitute a waiver of the rights of the Lender to
enforce any rights and remedies therein. 

On default in payment of any sum due hereunder for the
Principal Sum or Interest or after 15 days’ notice of Default to the Borrower
upon the occurrence of an Event of Default as defined pursuant to the Loan
Agreement, entered into between the Borrower and the Lender and dated for
reference July 25, 2016, or any amendments thereto, the unpaid balance of the
Principal Sum and all accrued Interest thereon shall at the option of the Lender
forthwith become due and payable. 

The undersigned, when not in default hereunder, will have the
privilege of prepaying in whole or in part the Principal Sum, upon 20 days’
notice to the Lender. 

Presentment, protest, notice of protest and notice of dishonour
are hereby waived. 

LEXARIA BIOSCIENCE CORP. 

	Per:  		 
	 	John Docherty, President and
      Authorized Signatory 

SCHEDULE B 

Collateral Security Interest 

U.S. Provisional Patent Application No. 62/010,601, filed June
11, 2014; and 

U.S. Provisional Patent Application No. 62/037,706, filed
August 15, 2014; and 

U.S. Provisional Patent Application No. 62/153,835, filed April
28, 2015; and 

U.S. Provisional Patent Application No. 62/161,324, filed May
14, 2015; and 

U.S. Utility Patent Application No. 14/735,844, filed June 10,
2015 (NOTE: Claims under this application have received a Notice of Allowance
from the USPTO July 2016 Serial No. 14/735,844); and 

U.S. Provisional Patent Application No. 62/264,959, filed
December 9, 2015; and 

U.S. Provisional Patent Appilcation No. 62/264,967, filed
December 9, 2015; and 

In addition, Lexaria has filed an international patent
application under the Patent Cooperation Treaty (PCT): PCT International Patent
Application No. PCT/US15/35128, filed June 10, 2015; and 

The Intellectual Property License Agreement dated May 14, 2016
entered into between Lexaria Biosciense and a Licensee; and 

All Lexaria-owned Tea, Coffee, Hot Chocolate and protein bar
inventory whether located at Lexaria’s Phoenix warehouse or at any other
location.

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