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• <br />• <br />• <br />VI. Covenants of Lessee <br />6.1 Lessee Covenants and Agrees: <br />(a) It shall conduct operations in a miner -like manner in accordance with <br />good industry practice and applicable laws and regulations. All work <br />shall at all times be under the sole control of and done in accordance <br />with the exercise of the discretion and judgment of Lessee as to time, <br />place, method and manner of performance. Accordingly, as to such work <br />and the responsibility for it as provided in Paragraph 6. 1 (e) following <br />there is not deemed by Lessor and Lessee to be a contractual relationship <br />between them as to the manner of performance, direction, and <br />supervision of such work since such matters, by the Lease terms, are to <br />be determined in the discretion of the Lessee subject to applicable rules <br />of State and Federal regulatory agencies. <br />(b) Lessee shall post and keep posted on the Mining Properties a notice <br />that it holds possession pursuant to this Mining Lease and that it is solely <br />responsible for the payment of all obligations incurred by its operations. <br />(c) Lessee shall pay when clue all claims for work done, services <br />rendered, or materials furnished to the Mining Properties, except those <br />which Lessee disputes in good faith. <br />(d) Lessee shall keep the Mining Properties free and clear from all liens <br />and encumbrances, but may in good faith contest the validity or amount <br />of any lien which may be levied against the Mining Properties. <br />(e) Lessee agrees to indemnify and hold the Lessor harmless from any <br />and all claims, demands and liabilities arising out of or in connection <br />with the operations or activities of the Lessee on the Mining Properties <br />from and after the effective date. The Lessee assumes full and sole <br />responsibility for the operation and direction of the work done <br />hereunder. No employee or agent of Lessee shall under any <br />circumstances be deemed an employee or agent of the Lessor. <br />(f) Lessee agrees to maintain at all times Workmen's Compensation <br />Insurance pursuant to the laws of Colorado and shall comply with state <br />and federal laws and regulations pertaining to employment; and shall <br />8 <br />