Document:

Exhibit
10.33

 

NOTE
PURCHASE AGREEMENT

 

THIS
NOTE PURCHASE AGREEMENT (the “Agreement”) is made as of October 14, 2016 (the
“Effective Date”) by and among Desert Hawk Gold Corp., a Nevada corporation (the
“Company”), and the purchasers executing a purchaser signature page attached hereto (each, individually, a
“Purchaser” and collectively, the “Purchasers”). Any capitalized term not otherwise defined
herein shall have the meaning set forth for such term in the Notes (defined below).

 

RECITALS

 

WHEREAS,
the Purchasers desire to purchase and the Company desire to sell the Notes on the terms and conditions described herein.

 

AGREEMENT

 

NOW,
THEREFORE, in consideration of the foregoing, and the representations, warranties, covenants and conditions set forth below,
the Company and each Purchaser, intending to be legally bound, hereby severally and not jointly agree as follows:

 

1.
AMOUNT AND TERMS OF THE NOTES. Subject to the terms of this Agreement, at the Closing (as defined below) the Company agrees
to issue and sell to each of the Purchasers, and each Purchaser agrees, severally and not jointly, to purchase from the Company,
a secured convertible promissory note in the form attached to this Agreement as Exhibit A (each a “Note”
and collectively, the “Notes”) in the principal amount set forth on such Purchaser’s signature page hereto
(each, a “Loan Amount”). The aggregate principal amount of all Notes shall not exceed Two Hundred and Fifty
Thousand Dollar ($250,000).

 

2.
COLLATERAL. Pursuant to the Security Agreement in the form attached hereto as Exhibit B (the “Security
Agreement”), the Company shall grant to the Purchasers, on a pari passu basis, a senior security interest in all Collateral
(as defined in the Security Agreement) to secure all of the Company’s obligations under the Notes.

 

3.
USE OF PROCEEDS. The Company shall use the net proceeds from the sale of the Notes solely to cure continuing default as referred
to in the Notice of Default dated September 19, 2016 received from counsel appointed by Clifton Mining Company and The Woodmam
Mining Company.

 

4.
THE CLOSING

 

4.1
Closing Date. The closing of the sale and purchase of the Notes (the ''Closing'') shall be held on the Effective Date
or upon such later date when all of the deliveries required by Section 4.3 below have been made by the applicable parties hereto.

 

4.2
Delivery. At the Closing, (i) each Purchaser will deliver to the Company a wire transfer of funds in the amount of such Purchaser's
Loan Amount according to the wire instructions attached hereto as Exhibit C, along with such Purchaser's execution
of the Security Agreement; and (ii) the Company will issue and deliver to each Purchaser (a) a Note executed by the Company in
favor of such Purchaser payable in the amount of such Purchaser's Loan Amount, and (b) the Company's execution of the Security
Agreement.

 

    1

     

    

 

5.
REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby represents and warrants to each Purchaser in a Closing,
as of the date of such Closing, as follows:

 

5.1
Organization, Good Standing and Qualification. The Company is a corporation duly organized, validly existing and in good standing
under the laws of the State of Nevada. The Company has the requisite corporate power to own and operate its properties and assets
and to carry on its business as now conducted and as proposed to be conducted. The Company is duly qualified and is authorized
to do business and is in good standing as a foreign corporation in all jurisdictions in which the nature of its activities and
of its properties (both owned and leased) makes such qualification necessary, except for those jurisdictions in which failure
to do so would not have a material adverse effect on the Company or its business.

 

5.2
Corporate Company Power. The Company has all requisite corporate power to execute and deliver this Agreement, the Notes, the
Security Agreement and any other related documentation (collectively, the ''Loan Documents'') and to carry out and perform
its obligations under the Loan Documents.

 

5.3
Authorization. All corporate action on the part of the Company necessary for the authorization, execution, delivery and performance
of the Loan Documents by the Company and the performance of the Company's obligations thereunder has been properly taken. The
Loan Documents, when executed and delivered by the Company, will constitute valid and binding obligations of the Company enforceable
in accordance with their terms, subject to laws of general application relating to bankruptcy, insolvency, the relief of debtors
and, with respect to rights to indemnity, subject to federal and state securities laws.

 

5.4
Consents and Approvals. The holder of the Company's senior secured debt, the Company is not required to obtain any consent,
waiver, authorization or order of, give any notice to, or make any filing or registration with, any court or other federal, state,
local or other governmental authority or other third party in connection with the execution, delivery and performance by the Company
of the Loan Documents, other than the consent and waiver of DMRJ Group I, LLC, the filing of Form D with the Securities and Exchange
Commission (the ''Commission'') and such filings as are required to be made under applicable state securities laws.

 

5.5
Offering. Assuming the accuracy of the representations and warranties of the Purchasers contained in Section 6 hereof, the
offer, issue, and sale of the Securities are and will be exempt from the registration and prospectus delivery requirements of
the Securities Act of 1933, as amended (the ''Securities Act"), and have been registered or qualified (or are exempt from
registration and qualification) under the registration, permit, or qualification requirements of all applicable state securities
laws.

 

6.
REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS

 

6.1
Acceptance by the Company. The Purchaser acknowledges that such Purchaser's Loan Amount may be accepted or rejected, in whole
or in part, by the Company in its sole discretion. The Company shall have no obligation to sell a Note to the Purchaser unless
and until this Agreement is executed and delivered by the Purchaser and accepted by the Company and the Company has received the
Loan Amount.

 

    2

     

    

 

6.2
Purchase for Own Account. Each Purchaser represents that it is acquiring the Notes solely for such Purchaser's own account
and beneficial interest for investment and not for sale or with a view to distribution of the Notes or any part thereof, has no
present intention of selling (in connection with a distribution or otherwise), granting any participation in, or otherwise distributing
the same, and does not presently have reason to anticipate a change in such intention. Purchaser understands and acknowledges
that none of the Notes are registered under the Securities Act or any state securities laws. The Purchaser understands that the
offering and sale of the Notes is intended to be exempt from registration under the Securities Act, by virtue of Rule 506 of Regulation
D as promulgated by the Commission thereunder, based, in part, upon the representations, warranties and agreements of the Purchaser
contained in this Agreement and neither the Commission nor any state securities commission or other regulatory authority has approved
the Notes or passed upon or endorsed the merits of the offering of the Notes;

 

6.3
Information and Sophistication. Each Purchaser hereby: (i) acknowledges that such Purchaser has received and carefully reviewed
all the information such Purchaser has requested from the Company and considers necessary or appropriate for deciding whether
to acquire the Notes, including the Commission Filings, (ii) represents that such Purchaser's representatives and advisors have
had an opportunity to ask questions and receive answers from the Company regarding the terms and conditions of the offering of
the Notes and to obtain any additional information necessary to verify the accuracy of the information given such Purchaser, (iii)
represents that such Purchaser is not relying upon, and has not relied upon, any statement, representation or warranty made by
any person, including, except for representations contained in this Agreement and statements expressly authorized by the Company
to be made to such Purchaser under an obligation of confidentiality on the part of such Purchaser, and (iv) further represents
that such Purchaser has such knowledge and experience in financial and business matters that such Purchaser is capable of evaluating
the merits and risk of this investment.

 

6.4
Ability to Bear Economic Risk. Each Purchaser acknowledges that an investment in the Notes involves a high degree of risk,
and represents that such Purchaser is able, without materially impairing such Purchaser's financial condition, to hold the Notes
for an indefinite period of time and to suffer a complete loss of such Purchaser's investment.

 

6.5
Accredited Investor Status. Each Purchaser represents and warrants that such Purchaser is an ''accredited investor'' as such
term is defined in Rule 501 under the Securities Act as of the Effective Date.

 

6.6
General Solicitation. Each Purchaser represents that such Purchaser is not purchasing any Notes as a result of any advertisement,
article, notice or other communication regarding the Notes published in any newspaper, magazine or similar media or broadcast
over television or radio or presented at any seminar or any other general solicitation or general advertisement.

 

6.7
Termination of Commission Registration; Unavailability of Rule 144. Each Purchaser acknowledges and understands that as
a former ''shell company'' as such term is defined in Rule l2b-2 under the Securities Act, the Company is subject to the
provisions of Rule 144(i)(2) under the Securities Act, which provides that Rule 144 is only available for the resale of
securities of an issuer that is or has previously been a shell company if (1) the issuer is subject to the reporting
requirements of Section 13 or 15(d) of the Exchange Act; (2) has filed all reports and other materials required to be filed
by section 13 or 15( d) of the Exchange Act, as applicable, during the preceding 12 months ( or for such shorter period that
the issuer was required to file such reports and materials); (3) and one year has elapsed since the Company has filed current
''Form  10 information'' with the Commission reflecting its status as an entity that is no longer a shell company. The
Company has not filed all reports and other materials required to be filed by Section 14 or 15( d) of the Exchange Act during
the preceding 12 months and, as a result, the Purchasers may not rely on Rule 144 for resales of the Company's securities
including, the Notes or the Company's equity securities issuable upon conversion of the Notes. The Purchaser acknowledges and
understands that Rule 144 will not be available to the Purchaser until such time as the Company all reports required to be
filed with the Commission for the preceding 12 months. The Company does not currently intend to file any such reports with
the Commission and there are no assurances that the Company will do so in the future.

 

    3

     

    

 

7.
MISCELLANEOUS

 

7.1
Binding Agreement. The terms and conditions of this Agreement will inure to the benefit of and be binding upon the respective
successors and assigns of the parties. Nothing in this Agreement, expressed or implied, is intended to confer upon any third party
any rights, remedies, obligations, or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.

 

7.2
Governing Law. IN ALL RESPECTS, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS AGREEMENT AND THE OBLIGATIONS
ARISING HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEVADA APPLICABLE
TO CONTRACTS MADE AND PERFORMED IN SUCH STATE, WITHOUT REGARD TO THE PRINCIPLES THEREOF REGARDING CONFLICTS OF LAWS, AND ANY APPLICABLE
LAWS OF THE UNITED STATES OF AMERICA. THE COMPANY AND EACH PURCHASER HEREBY CONSENTS AND AGREES THAT THE STATE OR FEDERAL COURTS
LOCATED IN THE STATE OF NEVADA SHALL HAVE JURISDICTION TO HEAR DETERMINE ANY CLAIMS OR DISPUTES BETWEEN OR AMONG THE PURCHASERS,
ON THE ONE HAND, AND COMPANY, ON THE OTHER HAND, PERTAINING TO THIS AGREEMENT OR TO ANY MATTER ARISING OUT OF OR RELATED TO THIS
AGREEMENT.

 

7.3
Counterparts. This Agreement may be executed in two or more counterparts, each of which will be deemed an original, but all
of which together will constitute one and the same instrument.

 

7.4 Titles and Subtitles. The titles and subtitles used in the is Agreement are used for convenience only and are not to be
considered in construing or interpreting this Agreement.

 

7.5
Further Actions. The Company will execute and deliver such other agreements, conveyances, and other documents, and take such
other action, as may be reasonably requested by the Purchasers in order to give effect to the transactions contemplated by this
Agreement and the other Loan Documents.

 

7.6
Notices. All notices required or permitted hereunder will be in writing and will be deemed effectively given: (a) upon personal
delivery to the party to be notified, (b) when sent by electronic mail or facsimile with confirmation of receipt or transmission
if sent during normal business hours of the recipient, if not, then on the next business day, (c) five (5) days after having been
sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one (1) day after deposit with a nationally
recognized overnight courier, specifying next day delivery, with written verification of receipt. All communications will be sent
to the Company at 1290 Holcomb Ave. Reno, Nevada 89502, Attn: Rick Havenstrite and to Purchaser at the address(es) set forth on
each Purchaser's signature page or at such other address(es) as the Company or Purchaser may designate by ten (10) days advance
written notice to the other parties to this Agreement.

 

7.7
Modification; Waiver. No modification or waiver of any provision of this Agreement or consent to departure therefrom will
be effective unless in writing and approved by each Holder.

 

    4

     

    

 

7.8
Expenses. The Company and each Purchaser will each bear its respective expenses and legal fees incurred with respect to the
Loan Documents and the transactions contemplated thereby. If any action, suit or other proceeding is instituted concerning or
arising out of this Agreement or any transaction contemplated under the Loan Documents, the prevailing party shall recover all
of such party's costs and attorneys' fees incurred in each such action, suit, or other proceeding, including any and all appeals
or petitions from such action, suit or other proceeding.

 

7.9
Delays or Omissions. The parties agree that no delay or omission to exercise any right, power or remedy accruing to each Purchaser,
upon any breach or default of the Company under this Agreement will impair any such right, power or remedy, or will it be construed
to be a waiver of any such breach or default, or any acquiescence therein, or of or in any similar breach or default thereafter
occurring; nor will any waiver of any single breach or default be deemed a waiver of any otl1er breach or default theretofore
or thereafter occurring. It is further agreed that any waiver, permit, consent or approval of any kind or character by any Purchaser
of any breach or default under this Agreement, or any waiver by any Purchaser of any provisions or conditions of this Agreement
must be in writing and will be effective only to the extent specifically set forth in writing and that all remedies, either under
this Agreement, or by law or otherwise afforded to the Purchasers, will be cumulative and not alternative.

 

7.10
Severability. If any provision of this Agreement becomes or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, portions of such provision, or such provision in its entirety, to the extent necessary, shall be severed
from this Agreement, and such court will replace such illegal, void or unenforceable provision of this Agreement with a valid
and enforceable provision that will achieve, to the extent possible, the same economic, business and other purposes of the illegal,
void or unenforceable provision. Tl1e balance of this Agreement shall be enforceable in accordance with its terms.

 

7.11
Entire Agreement. This Agreement, the exhibits to this Agreement and the other Loan Documents constitute the full and entire
understanding and agreement between the parties with regard to the subjects hereof and no party will be liable or bound to any
other party in any manner by any representations, warranties, covenants and agreements except as specifically set forth in this
Agreement.

 

7.12
Reliance on Counsel and Advisors. Each Purchaser acknowledges that counsel to a particular Purchaser represents only that
Purchaser and shall not be deemed to be counsel to any other Purchaser in this transaction. Each Purchaser acknowledges that such
Purchaser has had the opportunity to review this Agreement, including all attachments hereto, and the transactions contemplated
by this Agreement with such Purchaser's own legal counsel, tax advisors and other advisors. Each Purchaser is relying solely on
such Purchaser's own counsel and advisors and not on any statements or representations of any other Purchaser, such other Purchaser's
counsel or advisors, or the Company's counsel for legal or other advice with respect to this investment or the transactions contemplated
by this Agreement.

 

7.13.
No Commitment for Additional Investment. The Company acknowledges and agrees that no Purchaser has made any representation,
undertaking, commitment or agreement to provide or assist the Company in obtaining any financing, investment or other assistance,
other than the purchase of the Notes as set forth herein and subject to the conditions set forth in herein. In addition, the Company
acknowledges and agrees that, except as set fortl1 in this Agreement, (a) no statements, whether written or oral, made by any
Purchaser or its representatives on or after the date of this Agreement shall create an obligation, commitment or agreement to
provide or assist the Company in obtaining any financing or investment, (b) the Company shall not rely on any such statement by
any Purchaser or such Purchaser's representatives and (c) an obligation, commitment or agreement to provide or assist the Company
in obtaining any financing or investment may only be created by a written agreement, signed by such Purchaser and the Company,
setting forth the terms and conditions of such financing or investment and stating that the parties intend for such writing to
be a binding obligation or agreement.

 

    5

     

    

 

Each
Purchaser shall have the right, in such Purchaser's sole and absolute discretion, to refuse or decline to participate in any other
financing of or investment in the Company, and shall have no obligation to assist or cooperate with the Company in obtaining any
financing, investment or other assistance.

 

7.14.
Signatures. It is hereby agreed that tl1e execution by the Purchaser of this Agreement, in the place set forth herein, will
constitute the agreement by such Purchaser to be bound by the terms of the Note.

 

[SIGNATURE
PAGE FOLLOWS.]

 

    6

     

    

 

IN
WITNESS WHEREOF, the parties have executed this NOTE PURCHASE AGREEMENT as of the date first written above.

 

	 	COMPANY: 
	 	 	 
	 	DESERT HAWK GOLD CORP. 
	 	 	 
	 	By:	/s/
    Howard Crosby
	 	 	Howard
    Crosby, Chief Executive Officer

 

    7

     

    

  

NOTE
PURCHASE AGREEMENT PURCHASER SIGNATURE PAGE

 

IN
WITNESS WHEREOF, the parties have executed this NOTE PURCHASE AGREEMENT as of the date first written above.

 

	 	PURCHASER:
	 	 
	 	IBEARHOUSE
    LLC
	 	 	 
	 	By:	/s/
    Kelley Price
	 	 	Kelley
    Price, Manager

 

Dated
as of: October 14, 2016

 

Loan
Amount: $125.000

 

Address
for Notice:

 

7806 NE 10th St

 

Medina, WA 98039

 

	 	PURCHASER:
	 	 	 
	 	WEST C STREET LLC
	 	 	 
	 	By:	/s/
    Richard Meadows
	 	 	Richard
    Meadows, Manager

 

Dated
as of: October 14, 2016

 

Loan
Amount: $125.000

 

Address
for Notice

 

21838
NE 102nd ET

 

Redmond,
WA 98053

 

    8

     

    

 

EXHIBIT
A

 

FORM
OF PROMISSORY NOTE 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    9

     

    

 

EXHIBIT
B 

 

FORM
OF SECURITY AGREEMENT 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    10

     

    

 

EXHIBIT
C 

 

WIRE
INSTRUCTIONS 

 

[NAME
OF BANK]

 

[BANK
ADDRESS]

 

PHONE
NUMBER: ______________

 

ABA
NUMBER: ______________

 

ACCT.
NUMBER: _____________

 

BENEFICIARY: _______________

 

 

11Exhibit 10.34

 

SECURITY
AGREEMENT

 

This
SECURITY AGREEMENT (as amended, modified or otherwise supplemented from time to time, this “Agreement”),
dated and effective as of October 14, 2016 made by Desert Hawk Gold Corp., a Nevada corporation (“Debtor”),
in favor of Ibearhouse, LLC and West C Street, LLC (the “Secured Parties”).

 

RECITALS

 

A.
The Secured Parties have agreed to make available to Debtor a loan in the aggregate principal amount of Two Hundred Fifty Thousand
Dollars ($250,000) (the “Loan”) pursuant to the terms and conditions of that certain Note Purchase Agreement,
of even date herewith, by and between the Secured Parties and Debtor (the “Purchase Agreement”), as evidenced
by that certain Secured Convertible Promissory Note, of even date herewith, in the aggregate principal amount of the Loan (the
“Note”), issued as a part of a series of Secured Convertible Promissory Notes by Debtor in favor of Secured
Parties (collectively the “Notes” and, together with the Purchase Agreement and this Agreement, collectively,
the “Loan Documents”).

 

B.
As a condition to making the Loan to Debtor, the Secured Parties requires that it be granted, and has agreed to grant to Secured
Parties, on a pari passu basis based on the outstanding amount of the Obligation, a senior security interest in the property described
in Exhibit A attached hereto of the Debtor, whether now existing or hereafter from time to time acquired (collectively,
the “Collateral”), which senior security interest is senior to certain Senior Security Interests (as defined
below).

 

NOW,
THEREFORE, in order to induce the Secured Parties to make the Loan to Debtor, and for other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, Debtor hereby represents, warrants, covenants, grants and agrees as
follows:

 

AGREEMENT

 

1.
Incorporation of Recitals; Capitalized Terms. The recitals set forth hereinabove are incorporated herein by this reference.
All capitalized terms not otherwise defined herein have the meanings ascribed to them in the Purchase Agreement. Unless otherwise
defined herein, all terms defined in the Uniform Commercial Code (the “UCC”) have the respective meanings given
to those terms in the UCC.

 

2.
Definitions.

 

(a)
“Collateral” has the meaning given to that term in the Recital 8 hereof.

 

(b)
“Lien” means any mortgage, deed of trust, lien, pledge, and security interest or other charge or
encumbrance, of any kind whatsoever, including but not limited to the interest of the lessor or titleholder under any
capitalized lease, title retention contract or similar agreement.

 

(c)
“Obligation” means the outstanding amount of the Loan plus all accrued unpaid interest thereon. “Obligation”
also includes amounts owing under the Amended and Restate 15% Convertible Promissory Note dated July 14, 2010, as amended between
the Debtor and each of the Secured Parties. Finally, “Obligation” includes any amounts owing pursuant to shares purchased
by each of the Secured Parties which are redeemable with gold proceeds.

 

(d) “UCC”
means the Uniform Commercial Code as in effect in the State of Nevada from time to time.

 

    1

     

    

 

(e)
“Senior Securitv Interests” means the existing senior secured debt of the Debtor as of the date hereof,
and does not include any amounts of indebtedness by Debtor to DMRJ Group I, LLC (“DMRJ Group”) outstanding
as of the date hereof or that may accrue hereafter.

 

3. Security
Interest.

  

(a)
Debtor hereby grants to the Secured Parties, on a pari passu basis based on the Obligation, a senior security
interest (subject to subordination of the Senior Security Interests): (a) in all of the Collateral. whether now owned or
hereafter acquired, wherever located, whether or not such Collateral is or has been purchased, financed or otherwise acquired
by the use of the Loan proceeds, whether such Collateral is related to the business conducted by Debtor under any fictitious
business name referred to herein or under any other name, and whether or not the creation of a security interest therein is
subject to the LlCC or the Uniform Commercial Code as in effect in any other jurisdiction: and b) in all proceeds and
products thereof. 

  

(b)
Debtor hereby authorizes the Secured Parties to file appropriate UCC or other financing statements, all continuation,
amendments and modification filings related thereto and any other filings or recordings the Secured Parties deem necessary or
appropriate with respect to the Collateral and the Secured Parties’ interest therein. The Secured Parties may, in their
discretion, describe the Collateral as “all assets” or “all personal property.”

 

(c)
The security interest granted to Secured Party hereunder shall secure the Obligation.

  

4. Debtor’s
Representations, Warranties, Covenants and Agreements. Debtor hereby represent and warrants to the Secured Parties, and
covenants and agrees, that:

 

(a)
Debtor is the owner of (or, in the case of after-acquired Collateral, at the time Debtor acquires rights in the Collateral.
will be the owner thereof) and that no other Person has (or, in the case of after-acquired Collateral, at the time Debtor
acquires rights therein, will have) any right, title, claim or interest (by way of Lien or otherwise) in, against or to the
Collateral that is senior to the interest granted to the Secured Parties.

 

(b)
Upon the filing of UCC-I financing statements in the appropriate filing offices, the Secured Parties have (or in the case of
after-acquired Collateral, at the time Debtor acquires rights therein, will have), on a pari passu basis based on the
Obligation, a subordinated perfected security interest in the Collateral to the extent that a security interest in the
Collateral can be perfected by such filing.

  

(c)
This Agreement (i) has been duly authorized by all necessary corporate action of Debtor, (ii) has been duly executed by
Debtor, and (iii) constitutes the legal, valid and binding obligation of Debtor, enforceable against Debtor in accordance
with its terms.

 

(d)
Debtor’s place of business is located at 1290 Holcomb Ave, Reno, NV 89502. Debtor’s true legal name is as
set forth in the preamble to this Agreement. Debtor does not do
business under any trade name or fictitious business name and have never used any other trade name or fictitious business
name. Debtor will notify the Secured Parties, in writing, at least thirty (30) days prior to any change in its place of
business or jurisdiction of formation or the adoption or change of its legal name, any trade name or fictitious business
name, and will upon request of the Secured Parties, execute or authenticate any additional financing statement or other
certificates or records necessary to reflect any change in its place of business or jurisdiction of formation or the adoption
or change in its legal name, trade names or fictitious business name.

 

    2

     

    

 

5. Protection
of Collateral by Debtor.

 

(a)
Debtor and will not, without the prior written consent of the Secured Parties, sell, transfer or dispose of any Collateral
except for in the ordinary course of Debtor’s business. Debtor shall keep the Collateral free from any and all liens,
except by DMRJ Group (whose interest shall be subordinated). Debtor shall, at its own expense, appear in and defend any and
all actions and proceedings which purport to affect title to the Collateral, or any part thereof, or which purport to affect
the security interest of the Secured Parties therein under this Agreement.

  

(b)
Debtor will keep the Collateral current, collected and/or in good condition and repair, and will not misuse, abuse, allow to
deteriorate, waste or destroy the Collateral or any part thereof, except for ordinary wear and tear resulting from its normal
and expected use in Debtor’s business and will not use or permit any Collateral to be used in violation in any material
respect of any applicable law, rule or regulation, or in violation of any policy of insurance covering the Collateral. The
Secured Parties may examine and inspect the Collateral at any reasonable time, wherever located. Debtor shall perform,
observe, and comply in all material respects with all of the material terms and provisions to be performed, observed or
complied with by it under each contract, agreement or obligation relating to the Collateral.

  

(c)
Debtor, in a timely manner, will execute or otherwise authenticate, or obtain, any document or other record, give any
notices, do all other acts, and pay all costs associated with the foregoing, that the Secured Parties determine is reasonably
necessary to protect the Collateral against rights, claims or interests of third parties, or otherwise to preserve the
Collateral as security hereunder.

 

(d)
Debtor shall immediately notify the Secured Parties of any claim against the Collateral adverse to the interest of Secured
Parties therein.

 

(e)
Debtor shall, at its own expense, maintain insurance with respect to the Collateral in such amounts, against such risks, in
such form and with such insurers, as is commonly maintaincd by prudent persons engaged in businesses similar to the business
engaged in by Debtor. Each policy of liability insurance shall provide for all losses to be paid on behalf of Secured Party,
Debtor as its respective interests may appear; and each policy of property damage insurance shall provide for all losses to
be paid directly to the Secured Parties. Each such policy shall name the Secured Parties as an insured party thereunder
(without any representation or warranty by or obligation upon the Secured Parties) as its interest may appear.

 

(f)
Debtor shall promptly pay when due all taxes and other governmental charges. All Liens and all other charges now or
hereafter imposed upon or affecting any Collateral.

  

6. Further
Acts of Debtor. Debtor shall, at the request of the Secured Parties, execute or otherwise authenticate and deliver to
the Secured Parties any financing statements, financing statement changes and any and all additional instruments. documents
and other records, and Debtor shall perform all actions, that from time to time the Secured Parties may reasonably deem
necessary or desirable to carry into effect the provisions of this Agreement or to establish or maintain a perfected security
interest in the Collateral having the priority provided for herein or otherwise to protect the Secured Parties’
interest in the Collateral.

 

    3

     

    

 

7.
Effect of Additional Security. If the performance of all or any portion of the Obligation shall at any time be secured
by any other collateral, the exercise by the Secured Parties, in the event of a default in the performance of any such obligation,
of any right or remedy under any agreement or other record granting a lien on or security interest in such collateral shall not
be construed as or deemed to be a waiver of, or limitation upon, the right of the Secured Parties to exercise, at any time and
from time to time thereafter, any right or remedy under this Agreement or under any other such agreement or record.

 

8.
Default. Upon the occurrence of a Default or Event of Default under any Loan Document and the continuance thereof beyond
any applicable cure periods under the Loan Documents (a “Default”), the Secured Parties shall have ail the
rights and remedies of a the Secured Parties on default under the UCC (whether or not the UCC applies to the affected Collateral)
or, to the extent required by applicable law, the Uniform Commercial Code as in effect in the jurisdiction where Secured Parties
enforces such rights and remedies.

  

9. No
Implied Waivers. No delay or omission on the part of the Secured Parties in exercising any right or remedy created by,
connected with or provided for in this Agreement or arising from any default by Debtor, shall be construed as or be deemed to
be an acquiescence in or a waiver of such default or a waiver of or limitation upon the right of the Secured Parties to
exercise, at any time and from time to time thereafter, any right or remedy under this Agreement. No waiver of any breach of
any of the covenants or conditions in this Agreement shall be deemed to be a waiver of or acquiescence in or consent to any
previous or subsequent breach of the same or any other covenant or condition.

  

10. Entire
Agreement. This Agreement, together with each of the Loan Documents, contains the entire understanding and agreement of
Debtor and the Secured Parties with respect to the subject matter hereof and may not be altered or amended in any way except
by a written agreement signed by the parties. No provision of this Agreement or right of Secured Parties hereunder can be
waived, nor shall Debtor be released from its obligations hereunder, except by a writing duly executed by the Secured
Parties.

  

11. Transfer
of Indebtedness. Upon the transfer by the Secured Parties of all or any portion of the indebtedness secured hereby, the
Secured Parties may transfer therewith all or any portion of the security interest created hereunder, but the Secured
Parties shall retain all of their rights hereunder with respect to any part of such indebtedness and any part of its
security interest hereunder not so transferred.

  

12.
Term; Binding Effect. This Agreement shall be and remain in full force and effect until the Obligation has been fully performed
and paid. Upon expiration and payment or conversion in full of the Obligation, this Agreement shall automatically terminate and
Debtor shall be permitted to file or cause the Secured Parties to file one (I) or more UCC termination statements with respect
to the Collateral. Each of the provisions hereof shall be binding upon Debtor and its respective legal representatives, successors
and assigns and shall inure to the benefit of the Secured Parties and its legal representatives, successors and assigns.

 

13. Rules
of Construction. Terms used in the singular shall apply to the plural, and vice versa, as the context requires; likewise
masculine, feminine and neuter genders shall be interchangeable as the context requires. The use of the disjunctive term
“or” does not imply an exclusion of the conjunctive, i.e., “or” shall have the same meaning as the
expression “and/or.” “including” shall not be limiting. Headings and section titles are for
convenience of reference only and are not substantive parts of this Agreement, and shall not be given effect in construing
the provisions of this Agreement. Each reference to a Loan Document shall mean such Loan Document as from time to time
extended, modified, renewed, restated, reaffinned, supplemented or amended.

  

14. Severability.
If any provision of this Agreement. or the application thereof to any person or circumstance, shall, to any extent, be
invalid or unenforceable, the remainder of this Agreement, or the application of such term to persons or circumstances other
than those as to which it is invalid or unenforceable, shall not be affected thereby, and each term of this Agreement shall
be valid and enforceable to the fullest extent permitted by law.

  

15. Counterparts.
This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which
together shall constitute but one and the same instrument.

 

16.
Governing Law and Jurisdiction. This Agreement shall be deemed to be executed and delivered in the State of Nevada. The
Debtor and the Secured Parties: (i) agree that this Agreement shall be construed according to and governed by the laws of the
State of Nevada, without regard to principles of conflicts of law (except to the extent governed by the UCC); (ii) consents to
personal jurisdiction in the State of Nevada in the state and United States courts in Nevada; and (iii) consents to venue in the
State of Nevada, for all actions and proceedings with respect to this Agreement and the Loan Documents, and waives 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 16.

 

[SIGNATURE
PAGE FOLLOWS]

 

    4

     

    

 

IN
WITNESS WHEREOF, the undersigned has executed this Security Agreement as of the day and year first hereinabove written.

 

	 	DEBTOR:
	 	 	 
	 	DESERT
    HAWK GOLD CORP.,
	 	a Nevada corporation
	 	 	 
	 	By:	/s/
    Howard Crosby
	 	 	
    Howard Crosby, Chief
    Executive Officer
	 	 	 
	 	Accepted
    and Agreed:
	 	 	 
	 	SECURED
    PARTIES:
	 	 	 
	 	WEST
    C STREET LLC
	 	 	 
	 	By:	/s/
    Richard Meadows
	 	 	Richard
Meadows, Manager
	 	 	 
	 	IBEARHOUSE
    LLC
	 	 	 
	 	By:	/s/
    Kelley Price
	 	 	Kelley
Price, Manager

 

    5

     

    

 

EXHIBIT A

 

COLLATERAL
DESCRIPTION

 

All
property of Debtor, whether now owned or hereafter acquired. wherever located, including, without limitation, all right, title
and interest of Debtor in, to and under the following:

 

(a)
All Accounts;

 

(b)
All Chattel Paper;

 

(c)
All Commercial Tort Claims and other claims or causes of action;

  

(d)
All Deposit Accounts and cash;

  

(e)
All Documents;

  

(f)
All Equipment;

  

(g)
All General Intangibles;

 

(h)
All Goods;

 

(i)
All Instruments;

  

(j)
All Intellectual Property;

 

(k)
All Inventory;

 

(l)
All Investment Property;

 

(m)
All  Letter-of-Credit Rights;

 

(n)
All contract rights;

 

(o)
All financial assets;

 

(p)
All payment intangibles;

 

To
the extent not otherwise described above:

 

(i)
All insurance policies, including the proceeds thereof, and water stock;

 

(ii)
All architectural, structural, mechanical and engineering plans and specifications prepared for construction of improvements or
extraction of minerals from any real property now or hereafter owned or leased by Debtor and all studies, data and drawings related
thereto; and also all contracts and agreements of the Debtor relating to the foregoing plans and specifications or to the foregoing
studies, data and drawings or to the construction of improvements on or extraction of minerals or gravel from any real property
now or hereafter owned or leased by Debtor;

 

    6

     

    

 

(iii)
All refunds, rebates, reimbursements, reserves, deferred payments, deposits, cost savings, governmental subsidy payments. governmentally
registered credits (such as, by way of example and not as limitation, emissions reduction credits), other credits, waivers and
payments, whether in cash or kind, due from or payable by any governmental authority or any insurance or utility company relating
to any or all of the personal property or real property now or hereafter owned or leased by Debtor or to any improvements thereon
or any of the other collateral described herein or arising out of the satisfaction of any condition imposed upon or the obtaining
of any approvals for the development of the any real property now or hereafter owned by Debtor or the improvements thereon;

(iv) All refunds, rebates, reimbursements, credits and payments of any kind due from or payable by any governmental authority
or other entity for any taxes, special taxes, assessments, or similar governmental or quasi-governmental charges or levies imposed
upon Debtor with respect to any personal property or real property now or hereafter owned or leased by Debtor and with respect
to any improvements thereon or to any of the other collateral described herein, or arising out of the satisfaction of any condition
imposed upon or the obtaining of any approvals for the development of any real property now or hereafter owned or leased by Debtor
or the improvements thereon;

 

(v)
All supporting obligations with respect to any other Collateral; and

 

(vi)
All proceeds and products of any of the foregoing (and proceeds and products of proceeds and products).

 

The
term “Intellectual Property” means all intellectual and similar property of every kind and nature now owned or hereafter
acquired by Debtor. including inventions, designs, patents (whether registered or unregistered), copyrights (whether registered
or unregistered), trademarks (whether registered or unregistered), trade secrets, domain names, confidential or proprietary technical
and business information, know-how, methods, processes, drawings, specifications or other data or information and ail memoranda,
notes and records with respect to any research and development, software and databases and all embodiments or fixations thereof
whether in tangible or intangible form or contained on magnetic media readable by machine together with ail such magnetic media
and related documentation, registrations and franchises, and all additions, improvements and accessions to, and books and records
describing or used in connection with. any of the foregoing.

 

All
terms used herein which are defined in the UCC shall have the same meanings when used herein, unless the context requires otherwise
and except that (i) for purposes of this Agreement, the meaning of such terms will not be limited by reason of any limitation
on the scope of the UCC, whether under Section 9-109 of the UCC, by reason of federal preemption or otherwise, and (ii) to the
extent the definition of any category or type of Collateral is expanded by any amendment, modification or revision to the UCC,
such expanded definition will apply automatically as of the date of such amendment, modification or revision.

 

 

7

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