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24. WATER RIGHTS - If Lessee initiates or establishes any water right where the point of diversion or <br />groundwater withdrawal is on the Leased premises and where the surface is owned by the State, such water <br />right must be obtained in the name of and with the consent of the State acting by and through its Board of <br />Land Commissioners. <br />Water rights and any improvement required to bring this water to the surface shall become the <br />property of the State, without cost, upon termination of this lease for any cause whatsoever. <br />Under no circumstance may ground water be withdrawn without first having secured the permission <br />of Lessor and may not be withdrawn at a rate higher than necessary for the mining and/or processing of <br />State minerals only. Additional payment may be required for the use of any waters as may be defined as <br />tributary or non-tributary.- <br />25. LIENS AND CLAIMS - Lessee shall not suffer or permit to be enforced against the Leased Premises, or <br />any part thereof, or any improvements thereon, any liens arising from, or any claim for damage growing <br />out of the work of any construction, repair, restoration, replacement or improvement, or any other claims <br />or demand howsoever the same may arise, but Lessee shall pay or cause to be paid all of said liens, claims, <br />or demands before any action is brought to enforce the same against the Leased Premises or improvements. <br />Lessee agrees to defend, indemnify and hold Lessor and the Leased Premises free and harmless from all <br />liability for any and all such liens, claims, demands, and actions together with reasonable attorney fees and <br />all costs and expenses in connection therewith. <br />Lessee shall, upon execution of this lease at its cost, prepare a Notice, pursuant to C.R.S. § <br />38-22-105 and cause the same to be posted for the purpose of protecting Lessor against any liens or <br />encumbrances upon the Leased Premises by reason of work, labor, services or materials contracted for or <br />supplied to Lessee. <br />.26. SURRENDER AND RELINQUISHMENT -- Lessee may, at any time, by paying to Lessor, all amounts' <br />then due as provided herein, surrender and cancel this Lease insofar as the.same covers all or any portion <br />of the lands herein leased and be relieved from further obligations or liability hereunder with respect to the <br />lands so surrendered; provided that no partial surrender or cancellation of this Lease shall be for less than. <br />tracts' of approximately 40 acres or goveznmental lot corresponding to a quarter-quarter'section, the rental <br />being reduced proportionately. <br />This surrender clause and option herein reserved to Lessee shall cease and. become absolutely <br />inoperative immediately and concurrently with the institution of any suit in any court of law by'Lessee, <br />Lessor or- any assignee of either to enforce this Lease, or any of its terms, express or implied, but in no <br />case shall surrender be effective until Lessee shall have made full provision for conservation. of the minerals <br />and protection of the surface rights of the Leased Premises as may be determined by Lessor. <br />Notwithstanding the foregoing, no surrender and relinquishment of this lease shall be effective unless <br />and until all reports, documents and information of any kind required to be submitted to Lessor under this <br />Lease, or to such state agencies as provided in this Lease have been submitted to Lessor or such state <br />agency. <br />27. RIGHT O'F REMOVAL -- In the event this Lease is terminated by forfeiture, surrender, or the expiration <br />of its term, and all obligations of Lessee under this Lease are satisfied, all Lessee's improvements, <br />equipment, man-made objects of any type, stockpiles and.dumps shall be removed from the Leased <br />Premises within 6 months from the date of such termination at Lessee's expense: Such removal is to be <br />accomplished without unnecessary waste or damage to the Leased Premises and Lessee shall restore the <br />surface of the Leased Premises to the same condition as immediately prior to the execution of this Lease. <br />All improvements and equipment remaining on the Leased Premises six months after the termination hereof <br />A - ; Page 8 of 10