2011-02-28_REVISION - M1981185 (4)

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operations in the Mining Properties and in any adjacent properties, provided that it is a lessee or otherwise an operator of such adjoining property. 1.2 Term. This Mining Lease shall commence on the effective date and shall continue for a period often (10) years ending on June 1,2016 (the "Primary Term") and so long thereafter as mining, production and/or development are being conducted on a continuous basis, unless terminated as hereinafter provided. It shall be considered that such operations are continuous unless and until after the end of the primary term, a period of three hundred sixty five (365) consecutive days elapses during which no mining, production and/or development is conducted, excepting periods of shut-down in the normal course of operations and force majeure. "Development" shall mean work or construction in preparation for mining or processing a proven or possible ore reserve, but not including drilling of such an ore reserve. Unless otherwise specified, all references to the term of this Mining Lease shall mean and include both the primary term and the continuing term. (a) Lessor is in exclusive possession of and represents that it holds marketable title to the Mining Properties, free and clear of all defects in title, adverse claims, liens, encumbrances or agreements affecting title of any kind by, through or under Lessor. Any warranty or liability disputes arising under this subsection shall be handled in the manner specified in Section III hereof. (b) The Lessor is not aware of any litigation, claims or demands made by others with respect to the title of its Mining Properties. (c) The Lessor has the right and authority to execute this Mining Lease and to lease the Mining Properties to the Lessees. (d) To the best of the Lessor's belief, no other person, association or corporation has any interest or claim to the Mining Properties, and all prior leases covering them have been terminated or released.