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10. Assignment —The Lessee,with the written consent of the Lessor,will have the right to assign this lease as to the
<br /> entire leasehold interest of such Lessee in ail or part of the lands covered hereby,not less,however,than tracts of
<br /> approximately forty (40) acres or Governmental lot corresponding to a quarterquarte ection for any partial
<br /> assignment,and for approval of such assignment the Lessor will make a charge of'- •UU for any
<br /> one assignment. NO assignment of undivided interests or retention or reservation of overriding royalties will be
<br /> recognized or approved by Lessor;and the effect,if any,of any such assignments or reservations will be strictly
<br /> and only as between the parties thereto,and outside the terms of this lease,and no dispute between parties to any
<br /> such assignment or reservation shall operate to relieve the Lessee from performance of any terns or conditions
<br /> hereof or to postpone the time therefor.Lessor will at all times be entitled to look solely to the Lessee or his
<br /> assignee shown on its books as being the sole owner hereof,and for the sending of all notices required by this
<br /> lease,and for the performance of all terms and conditions hereof.If an assignment of this lease,in whole or in
<br /> part,isapproved,a new lease will be issued to the assignee for the balance of the life of the lease,covering the
<br /> lands assigned.Said lease will be on the minting lease form in use at the time of assignment,and limited as to term
<br /> as said lease is limited,and the assignor shall be released from all further obligations,and shall be held to have
<br /> released all rights and benefits thereafter accruing with respect to the assigned land,as if the same had never been
<br /> a part of the subject matter of this lease.
<br /> 11. Prospectus4 —Lessee agrees that while using and operating any diamond,churn,or other.aril o -
<br /> c:rKsaid premises,it will keep an accurate log on all work so done and performed,showing geological
<br /> formations penetrated,the depth or thickness of each,the mineral character of each especially mineral veins and
<br /> water bearing strata,the location of same,the elevation,and tie to a corner established by U.S.surveys of some
<br /> legal subdivision, and each and every thing necessary to make a complete log of the hole throughout its entire
<br /> depth,a true copy of which said log will be furnished to the Lessor.
<br /> It is understood and agreed that the methods used in carrying out any program of exploration,and the rate of
<br /> progress of such program may be determined by the Lessee.If the Lessee carves on any program of exploration,
<br /> other than drilling,Lessee will submit to Lessor written reports showing the character and extent of prospecting
<br /> being carried out on the leased premises and giving any details of mineral outcropppings,seams,and veins which
<br /> may have been encountered;and Lessor agrees that during the term of this lease all such information supplied to
<br /> Lessor by Lessee will remain confidential and unpublished so far as consistent with law.
<br /> 12. Surrender and Relinquishment—The Lessee may at any time,by paying the State of Colorado,acting through its
<br /> State Board of n ommissioners, all amounts then due as provided herein,surrender and cancel this lease
<br /> insofar as the same covers all or any portion of the lands herein leased and be relieved from further obligations or
<br /> Liability hereunder with respect to the lands so surrendered;provided,that no partial surrender or cancellation of
<br /> this lease may be for less than tracts of approximately forty(40)acres or Governmental lot corresponding to a
<br /> quarter-quarter section,the rental being reduced proportionately;provided further,that this surrender clause and
<br /> option herein reserved to the Lessee will cease and become absolutely inoperative immediately and concurrently
<br /> with the institution of any suit in any court of law by the Lessee,Lessor,or any assignee of either,to enforce this
<br /> lease or any of its terms,express or implied,but in no case will surrender be effective until Lessee has made full
<br /> provision for conservation of the minerals and protection of the surface.rights of the leased premises.
<br /> All information in Paragraphs 5 and 11, above, must have been filed with the Board before this lease may be
<br /> terminated.
<br /> 13. If lessee initiates or establishes any water right for the leased premises,the point of surface diversion or ground
<br /> water withdrawal of which is on the leased premises, such right will,if the surface rights of said premises are
<br /> owned by lessor,become property of lessor,without cost,at the termination of the lease.
<br /> 14. Protection a ainst Surface Dama e—Bond Reouirements—Lessee has the right to utilize as much of the surface
<br /> of the an s as is necessary for mining operations.and is liable and agrees to pay for all damages to livestock,
<br /> growing crops,water wells,reservoirs,or improvements,caused by Lessee's operations on said lands.Further,it is
<br /> understood that this lease is granted subject to surface patents,deeds,and certificates of purchase,and Lessee
<br /> assumes responsibility for all claims arising from damages to the surface caused by Lessee's operations on such
<br /> lands. It is agreed and understood that no operations may be commenced on the lands hereinabove described
<br /> unless and until the Lessee or his assignee has filed a good and sufficient bond with the Lessor in an amount to be
<br /> fixed by Lessor,to secure the payment for such damage to livestock,growing crops,water,or improvements as
<br /> may be caused by Lessee or his assignee's operations on said lands.The Lessor may grant relief from the foregoing
<br /> bond requirement upon application for such relief from the Lessee.
<br /> 15. Indemnification of Lessor — The Lessee further agrees to hold the Lessor harmless for any and all manner of
<br /> claims ansing or to anse trout the said leased premises by Lessee whether from soil or surface subsidence or from
<br /> any other cause or any other nature whatsoever;this paragraph is binding upon Lessee and upon the heirs,assigns,
<br /> successors,and legal representatives of Lessee,and is a continuing obligation during and after the expiration of
<br /> this lease,so long as any possibility of sou or surface subsidence remains.
<br /> 16. Right of Removal—In the event this lease is terminated by forfeiture,surrender,or the expiration of term.and
<br /> obligations Lessee under this lease are satisfied,Lessee may remove all his improvements and equipment
<br /> from the said premises within six months from the date of such termination,and such removal must be accom-
<br /> plished without unnecessary waste or injury to the premises.All improvements and equipment remaining on the
<br /> (eased premises six months after the termination hereof will be forfeited automatically to the State of Colorado,
<br /> without compensation.
<br /> 17. Compliance with Law— Lessee further covenants and agrees that during the continuance of this lease it will fully
<br /> h comp y vnt te provisions, terns, and conditions of all laws,whether State or Federal,and orders issued
<br /> thereunder which may be in effect during the continuance hereof relating to mining or other operations of Lessee
<br /> hereunder.
<br /> 18. Forfeiture—It is agreed that if for any reason the Lessee fails to keep each and every one of the covenants herein,
<br /> and—i such default continues for a period of thirty(30)days after service of written notice thereof by certified
<br /> mail upon the Lessee by the Lessor, the Lessor has the right to declare this lease forfeited,and to enter onto the
<br /> 'eased premises,or any part thereof,either with or without process of law,and to expel,remove,and put out the
<br /> Lessee or any person occupying the premises,using such force as may be necessary to do so.It,the event of the
<br /> termination of this lease by reason of breach of me covenants herein contained,the Lessee will surrender and
<br /> peaceably deliver up to the Lessor the above-described premises which premises are to be in good mining
<br /> condition. If, upon termination of this lease for any reason,whether by surrender,forfeiture,or expiration of
<br /> term,or otherwise,Lessee has not complied fully with the terms of the lease,Lessor will hold and retain possession
<br /> of the property,improvements,and equipment of Lessee,as security unto Lessor for the payment of rents and
<br /> royalties due it, or to protect it against liens,or to indemnify it against any loss or damage sustained by it by
<br /> reason of the default of the Lessee, for which purpose Lessor is hereby given lien upon ail such property,
<br /> improvements, and equipment, which lien will attach as the same are placed upon the premises.In the event
<br /> Lessor forecloses the lien in this article given to it by Lessee.Lessor may itself be a purchaser at any sale thereof
<br /> under such foreclosure.Upon the termination of this lease for any cause,if the Lessee remains in possession of
<br /> said Premises,he will be guilty of an unlawful detainer under the statutes in such case made and provided,and he
<br /> will oe sub''ect to all the conditions and provisions thereof and to eviction and removal,forcibly or otherwise.
<br /> with or without process of law,as above provided_
<br /> RECEPTION NO. 85094449
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