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expose such additional water required to satisfy the requirements of state law including, without <br />limitation, the requirements of CRS 37-90-137(11). The Company shall be responsible for obtaining <br />a temporary substitute supply plan or augmentation plan for use of such water, which shall crake <br />adequate provision for evaporative losses, wash plant operations, dust control and any other uses of <br />water as part of the mining operation. The Company will not expose groundwater as part of the <br />mining operation or final reclamation plan, and, conditioned upon the Company's compliance with <br />its obligation not to expose groundwater, shall notbe required to apply for a permanent augmentation <br />plan. to cover any evaporative losses resulting from mining operation after termination of operations <br />under the Lease. The Advance Minimum and Sales Royalties payable hereunder take into account <br />the value of the water and water rights of Lessor to be used hereunder, and such water and water <br />rights shall be supplied by Lessor at no additional cost to the Company. All water rights of Lessor <br />used by Lessee pursuant to this Paragraph shall revert to Lessor upon termination of this Lease for <br />any icason. Any wells or other diversion or storage structures constructed or installed by the <br />Company in order to use water rights supplied by Lessor or appropriated from Lessor's property by <br />the Company shall become the property of Lessor upon termination of this Lease. Water and water <br />rights obtained by the Company from sources other than Lessor, including without limitation <br />augmentation water purchased or contributed by the Company for operations under this Lease, shall <br />be and remain the property of the Company upon termination of this Lease and the Company shall <br />haves no obligation to convey or make such water or water rights available to Lessor unless the <br />Company fails to comply with its obligation not to expose groundwater as part of its operations or <br />reclannatiox?. <br />7. Operations. <br />X Upon mutual execution of this Lease: <br />i. The Company shall commence and continue reasonably diligent efforts <br />to obtain all Permits necessary for the Company to conduct its operations on the Property as <br />cont?rnplated by this .Lease. Such diligent efforts shall specifically include the submission to the <br />applicable county planning authority of a conceptual or initial phase application with required initial <br />subrrittals for the use of the Property for the purposes contemplated by this Lease and the reasonably <br />diligent prosecution of such application and all other required Permits thereafter. <br />ii. The Company shall have the right to enter upon the Property while its <br />efforts in connection with the Permits are proceeding in order to conduct such further drilling, bulk <br />sampling, test pitting, material testing, investigation of the environmental condition of the Property <br />and such other inspections of the Property as the Company deems relevant to its operations. If any of <br />said activities conducted by the Company cause damage or injury to the Property the Company shall <br />restore the Property to its original condition prior to any termination of the Lease, at the Company's <br />sole Cost. <br />iii. If, despite its reasonable diligent efforts, any Permit required for <br />operations cannot be obtained or can be obtained only on conditions not acceptable to the Company <br />in its. sole discretion, or if the Company's inspection of the Property reveals any condition that <br />-7-