DEED OF TRUST, SECURITY AGREEMENT, ASSIGNMENT OF PRODUCTION, RENTS AND LEASEHOLD INTERESTS, FIXTURE FILING, AND FINANCING STATEMENT FROM AZCO MICA, INC., as Trustor TO FIRST AMERICAN TITLE INSURANCE COMPANY, as Trustee AND WATERTON GLOBAL VALUE, L.P.,...

Recording Requested By:
Name: Xxxx X. Xxxxxx, Esq.
Address: 0000 00^xx Xxxxxx, Xxxxx 000, Xxxxxx, Xxxxxxxx 00000

When Recorded Mail to:
Name: Xxxx X. Xxxxxx, Esq., Xxxxx Xxxxxx & Xxxxxx LLP
Address: 0000 00^xx Xxxxxx, Xxxxx 000, Xxxxxx, Xxxxxxxx 00000

DEED OF TRUST, SECURITY AGREEMENT,
ASSIGNMENT OF PRODUCTION, RENTS AND LEASEHOLD INTERESTS,
FIXTURE FILING, AND FINANCING STATEMENT

FROM

AZCO MICA, INC., as Trustor

FIRST AMERICAN TITLE INSURANCE COMPANY, as Trustee

AND

WATERTON GLOBAL VALUE, L.P., BY ITS INVESTMENT MANAGER, ALTITUDE
MANAGEMENT LIMITED, as Beneficiary

DATED AS OF DECEMBER ___, 2011

THIS INSTRUMENT CONTAINS AFTER-ACQUIRED PROPERTY PROVISIONS.

THIS INSTRUMENT SECURES FUTURE ADVANCES.

THIS INSTRUMENT COVERS FIXTURES AND GOODS THAT WILL BECOME FIXTURES ON THE PROPERTY DESCRIBED IN EXHIBIT A.

THIS INSTRUMENT SERVES AS A FIXTURE FILING AND AS A FINANCING STATEMENT COVERING AS-EXTRACTED COLLATERAL UNDER THE UNIFORM COMMERCIAL CODE OF ARIZONA.

TRUSTOR’S ORGANIZATIONAL IDENTIFICATION NUMBER: 2313110 (Delaware)

DEED OF TRUST, SECURITY AGREEMENT,
ASSIGNMENT OF PRODUCTION, RENTS AND LEASEHOLD INTERESTS,
FIXTURE FILING, AND FINANCING STATEMENT

This Deed of Trust, Security Agreement, Assignment of Production, Rents and Leasehold Interests and Financing Statement (the “Deed of Trust”) is entered into by and among Azco Mica, Inc., a corporation formed and existing under the laws of Delaware, and whose address is 0000 Xxxxxxxxxxxx Xx, Xxx. 000, Xxxxxxxxxxx, Xxx Xxxxxx 00000 (herein called “Trustor”), First American Title Insurance Company, a California corporation, and whose mailing address is P.O. Box 2922, Phoenix, Arizona 00000-0000 (herein called “Trustee”), and Waterton Global Value, L.P., by its Investment Manager, Altitude Management Limited, whose address is Folio House, Road Town, Tortola, VG1110, British Virgin Islands (herein called “Beneficiary”).

Recitals

A. Pursuant to that certain Senior Secured Gold Stream Credit Agreement dated December ___, 2011 among Santa Fe Gold (Barbados) Corporation, as the borrower (the “Borrower”), the Trustor, as a guarantor, the other Guarantors party thereto, as guarantors, and the Beneficiary, as the lender (as amended, modified, supplemented or restated from time to time, the “Loan Agreement”), and subject to the satisfaction of the conditions precedent stated therein, the Beneficiary has agreed to advance a Loan to the Borrower in the maximum principal amount of Twenty-Five Million Dollars ($25,000,000), all on the terms and conditions stated in the Loan Agreement. This Deed of Trust secures future advances, and advances under the Loan Agreement are obligatory. Capitalized terms used but not otherwise defined herein shall have the meanings given to them in the Loan Agreement.

B. It is a condition precedent to the Beneficiary entering into the Loan Agreement and making the Loan thereunder, that the Trustor shall have executed and delivered this Deed of Trust to secure the Loan Agreement and such payment and performance obligations and liabilities of the Trustor and the Borrower, all as more fully described herein.

C. The Trustor owns or holds or has an option to purchase those certain properties consisting of fee lands, patented mining claims, unpatented mining claims, unpatented millsite claims, mineral rights, leasehold and other rights and interests in Maricopa County and Yavapai County, Arizona as further described herein, including on Exhibit A attached hereto and incorporated herein by reference, which are commonly referred to herein as the “Black Canyon Mica Operation”.

D. The Trustor is an affiliate of the Borrower, and the Trustor will directly and indirectly benefit from the Loan Agreement and the loans made to the Borrower pursuant thereto. The Trustor has irrevocably and unconditionally guaranteed the payment and performance obligations of the Borrower arising under the Loan Agreement and each other Credit Document (as defined in the Loan Agreement) pursuant to a Guarantee of even date herewith (the “Guarantee”).

E. The Trustor expects to derive substantial direct and indirect benefit from the amounts made available under the Loan Agreement and from such financial and other support as the Borrower and the other Credit Parties may in the future provide to the Trustor. The Trustor, the Borrower and the other Credit Parties are engaged in related businesses and are integrated to such an extent that the financial strength and flexibility of each of them has a direct, tangible and immediate impact on the success of the other. The Trustor is interested in and will be financially benefited by the business success of the Borrower and the other Credit Parties and has entered into this Agreement and the other Credit Documents for legitimate business purposes.

F. The Borrower, the Beneficiary and certain other affiliates of the Borrower have entered into that certain Gold and Silver Supply Agreement dated December ___, 2011 (the “Gold and Silver Supply Agreement”), whereby the Sellers (as defined in the Gold and Silver Supply Agreement) have agreed to sell gold and silver to the Beneficiary at the price, and subject to the terms and conditions, stated therein. The obligation of the Sellers to sell gold and silver to the Beneficiary pursuant to the Gold and Silver Supply Agreement is independent of the Loan Agreement, and shall remain in effect for the term set forth in such Gold and Silver Supply Agreement.

G. This Deed of Trust is intended to act and operate as either a deed of trust or as a mortgage (but not both), at the sole option and direction of the Beneficiary. Upon foreclosure, pursuant to the terms and conditions stated herein, the Beneficiary may elect to treat this instrument either as a deed of trust and pursue a non-judicial foreclosure pursuant to the power of sale granted herein, or as a mortgage and pursue a judicial foreclosure.

Agreement

NOW, THEREFORE, in consideration of the premises, to induce the Beneficiary to enter into the Loan Agreement, the other Credit Documents, the Gold and Silver Supply Agreement and for other good and valuable consideration the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:

ARTICLE 1 – CREATION OF SECURITY

Section 1.1 Grant. In consideration of the moneys and credit advanced under the Loan Agreement for the benefit of the Trustor, and in consideration of the mutual covenants contained herein, and for the purpose of securing payment and performance of the Obligations (as defined below in Section 1.4), Trustor hereby grants, bargains, sells, warrants, assigns, pledges, transfers and conveys to the Trustee, IN TRUST, with power of sale and right of entry and possession subject to the terms hereof, for the benefit of the Beneficiary, all right, title and interest in and to the following real and personal property, rights, title and interests (collectively, the “Collateral”), whether presently owned or held or hereafter acquired:

(a) Lands and Realty. All lands and real property, including all fee, leasehold, option rights, mineral, patented mining claims, unpatented mining claims (lode and placer), unpatented millsites, tunnel sites and rights, royalties and other real property interests (whether surface, underground, mineral, or other), as more particularly described on Exhibit A attached hereto and incorporated herein by reference (collectively, the “Lands”);

(b) Gold, Silver and Minerals. All gold, silver and other ores, minerals, metals, mineral elements and compounds, dore, concentrate, veins, lodes and mineral deposits that are on, in, under, extending from or into, produced or to be produced from, stored, stacked, handled, processed, refined, beneficiated, transported or marketed on or from all or any part of the Lands, including “As-Extracted Collateral” as defined in A.R.S § 47-9102(A)(6), the Arizona Uniform Commercial Code, A.R.S. § 47-1101 et seq. (the “UCC”), all whether in place, extracted, produced, processed, stored or otherwise severed (collectively, the “Minerals”);

(c) Fixtures and Improvements. All buildings, structures, xxxxx, crushers, facilities, offices, shops, tanks, pipelines, fixtures and other improvements, howsoever designated, now or hereafter located or constructed on the Lands (collectively, the “Improvements”);

(d) Water Rights. All water, water rights (whether vested, certificated, permitted or otherwise, whether or not adjudicated, and whether or not with a place of use or point of diversion on the Lands), statements of claim, statements of claimant, grandfathered rights, water right applications, reservoirs and reservoir rights, ditches and ditch rights, irrigation systems and irrigation rights, xxxxx, well permits and other rights of use appertaining or belonging to or used in connection with the Lands and all xxxxx, pumps, pumping stations, machinery and equipment associated therewith, and all shares of stock or similar interest (if any) evidencing reservoir, ditch, irrigation or other water rights or rights of use (collectively, the “Water Rights”);

(e) Access Rights. All rights of way, easements, licenses, profits, privileges, tenements, hereditaments, appurtenances, roads, trails, transportation improvements, and other access rights or rights of use appertaining or belonging to or used in connection with the Lands, the Water Rights and/or the Improvements (collectively, the “Access Rights”);

(f) Property Data. All records, data, reports and information relating to or associated with all or any portion of the Lands, the Minerals or the Water Rights, including maps, surveys, drilling data, drill logs, core samples and core data, technical, engineering and permitting information and reports, and all geological, metallurgical, geophysical, geochemical and analytical data and reports (collectively, the “Data”);

(g) Permits and Approvals. All approvals, authorizations, licenses, permits, consents, variances, land use entitlements, applications, plans, bonds, filings or registrations by, with or from any governmental authority (federal, state or local) or other person associated with or necessary for the use or development of all or any portion of the Lands, Minerals, Improvements, Water Rights or Access Rights and all bonds, letters of credit and other financial accommodations that secure the performance of the foregoing (collectively, the “Permits”);

(h) Accounts; Contract Rights; General Intangibles. All accounts, accounts receivable, contracts and contract rights, option and purchase rights, agreements, documents, instruments, income, receipts, revenues, earnings, rents, profits, deposits, security deposits, royalties and revenue arising from the use or enjoyment of all or any portion of the Lands, the Improvements or other Collateral, from the production, crushing, milling, treatment, storage, marketing, hedging, sale or transfer of all or any portion of the Minerals and from the use, sale, assignment, conveyance or transfer of all or any portion of any other Collateral (collectively, the “Accounts”);

(i) Machinery; Equipment; Personal Property. All goods, machinery, equipment, drilling rigs and equipment, facilities, parts, supplies, power lines, tools, vehicles, rolling stock, furnishings, apparatus, inventory, fixtures and other personal property of every kind and nature, howsoever defined and whether or not attached or affixed in any manner to any building, structure or Improvement on the Lands (collectively, the “Personal Property”);

(j) All Associated Property. All other property (whether real, personal or mixed), right, title or interest of any kind, nature or character, howsoever defined or identified, related to or associated with the Black Canyon Mica Operation, the Lands, the Minerals, the Improvements, the Water Rights, the Access Rights, the Data, the Permits, the Accounts, the Personal Property or other property described herein; and

(k) Proceeds and Products. All proceeds and products of the Lands, Minerals, Improvements, Water Rights, Access Rights, Data, Permits, Personal Property, Accounts and other property rights and interests described herein.

TO HAVE AND TO HOLD all of the Collateral, together with all and singular the rights, privileges, benefits, contracts, hereditaments and appurtenances now or hereafter at any time before the foreclosure or release hereof, in any way appertaining or belonging thereto, unto the Trustee and to its substitutes or successors, forever, IN TRUST, upon the terms and conditions herein set forth; and Trustor hereby binds and obligates itself and its successors and assigns, to warrant and to defend, all and singular, title to the Collateral unto the Trustee, its substitutes or successors, forever, against the claims of any and all persons whomsoever claiming any part thereof.

Section 1.2 Creation of Security Interest. In addition to the grant contained in Section 1.1, and for the same consideration and purpose, the Trustor hereby grants to the Beneficiary, a first and prior continuing security interest in all Collateral constituting personal property, now owned or hereafter acquired by the Trustor, and in all Proceeds thereof (as defined below). The Trustor, without limiting the foregoing provisions of this Section 1.2, stipulates that the grant made by this Section 1.2 includes a grant of a security interest in all Minerals extracted or produced from or otherwise attributable to or severed from the Lands and in the Proceeds resulting from sale of such Minerals, such security interest to attach to such Minerals as-extracted, at the minehead of any mine located thereon, and to the Accounts resulting from such sales. “Proceeds” shall have the meaning given to such term in A.R.S. § 47-9102(A)(64) of the UCC, and includes whatever is received or receivable upon the sale, exchange, collection or other disposition of the Collateral and insurance payable or damages or other payments by reason of loss or damage to the Collateral, and all additions thereto, substitutions and replacements thereof or accessions thereto.

Section 1.3 Pledge and Assignment. The Trustor hereby grants and makes a common law pledge and assignment to the Beneficiary of all Refinery Accounts (defined below) and all credit balances therein from time to time. “Refinery Accounts” means any account or allocation, and the credit balances in dollars or Minerals therein, of or for the benefit of the Trustor at or with any refinery or processing facility to which Minerals severed from or attributable to the Lands are delivered or held, expressly including all accounts of the Trustor presently in effect, or hereafter constituted.

Section 1.4 Obligations Secured. This instrument is executed and delivered by the Trustor to secure and enforce the irrevocable, full, punctual and complete payment and performance when due (whether at stated maturity, by required prepayment, declaration, acceleration, demand or otherwise) of:

(a) All amounts due or to become due under the Loan Agreement, including the payment of all indebtedness, liabilities and amounts due or to become due under the Loan Agreement, in the original principal amount of up to Twenty-Five Million Dollars ($25,000,000) and under any other Credit Document, together with any amendment, modification, renewal, restatement, replacement or extension thereof. Notwithstanding the amount outstanding at any particular time, this Deed of Trust secures all amounts due under the Loan Agreement plus all costs, fees, expenses and charges provided therein, which is made a part hereof by reference. All advances under the Loan Agreement are obligatory and are secured by this Deed of Trust. All such obligatory advances, including future advances, and interest, fees, costs and charges thereon will have the same priority as the funds initially advanced under the Loan Agreement;

(b) Any and all other or additional indebtedness, liabilities or sums for which Trustor is now or may become liable to any Beneficiary or Trustee in any manner, whether under this instrument, the Guarantee, the Loan Agreement, any Credit Document or any other or future instrument or document, either primarily or secondarily, absolutely or contingently, directly or indirectly, jointly, severally, or jointly and severally, and whether matured or unmatured, and whether or not created after payment in full of the Obligations if this instrument shall not have been released of record by Beneficiary;

(c) All sums advanced and costs and expenses incurred by the Beneficiary or the Trustee (directly or indirectly), including all legal, accounting, engineering, management, consulting or like fees and expenses made or incurred in connection with the Credit Documents or the Obligations or any part thereof, any amendment, modification, renewal, restatement, replacement or extension thereof, the acquisition or perfection of any security therefor or otherwise in connection with the administration, preservation, perfection, enforcement and realization of the rights of the Trustee or the Beneficiary hereunder or under any of the other obligations secured hereby, including reasonable attorneys fees, courts costs and other litigation and foreclosure expenses;

(d) All renewals, extensions, amendments, modifications, restatements and changes of, or substitutions or replacements for, all or any part of the items described above; and

(e) Each and every covenant and agreement of Trustor contained in any Credit Document.

The indebtedness, liabilities and obligations secured hereby, as described in the foregoing clauses (a) – (e) are sometimes referred to herein as the “Obligations”.

Section 1.5 Proceeds. The security interest of the Beneficiary hereunder in the Proceeds shall not be construed to mean that the Beneficiary consents to the sale or other disposition of any part of the Collateral other than Minerals extracted from or attributable to the Lands and sold in the ordinary course of business.

Section 1.6 Substitution of Beneficiary for Trustor. This instrument shall be effective, at the Beneficiary’s option and as allowed by applicable law, either as a mortgage or as a deed of trust, and every grant herein to the Trustee of interests, powers, rights and remedies shall likewise be a grant of the same interests, powers, rights and remedies to the Beneficiary, as mortgagee. Subject to applicable law, the Beneficiary shall in all instances, and in its sole discretion, elect whether this instrument shall be effective as a mortgage or as a deed of trust.

Section 1.7 Future Advances. Trustor, and each party at any time claiming an interest in or lien or encumbrances against the Collateral, agrees that all advances made by the Beneficiary from time to time under any Credit Document, and all other portions of the Obligations herein referred to, shall be secured by this Deed of Trust with priority as if all of the same had been advanced, had arisen or became owing or performable on the date of this Deed of Trust. No reduction of the outstanding principal balance under the Loan Agreement shall extinguish, release or subordinate any rights, titles, interests, liens, security interests, powers or privileges intended, created or arising hereunder or under any other Credit Document, and this Deed of Trust shall remain in full force and effect as to any subsequent advances or subsequently arising portions of the indebtedness without loss of priority until all Obligations are fully paid, performed and satisfied, all agreements and obligations, if any, of Beneficiary for future advances have been terminated, and this Deed of Trust has been released of record by Beneficiary. THIS DEED OF TRUST SECURES FUTURE ADVANCES AND THE MAXIMUM AMOUNT OF PRINCIPAL TO BE SECURED IS TWENTY-FIVE MILLION DOLLARS ($25,000,000).

Section 1.8 Continuing Status of Lien, Security Interest and Pledge. So long as the commitment to advance funds under the Loan Agreement remains in effect, whether or not subject to the satisfaction of any conditions precedent, the lien on the Collateral constituting real property and the security interest in and pledge relating to the Collateral constituting personal property created hereby shall remain in effect with the priority date established by the recording or filing hereof, notwithstanding the fact that from time to time the outstanding balance of the loans outstanding under the Loan Agreement may be zero.

ARTICLE 2 – ASSIGNMENT OF PRODUCTION PROCEEDS, RENTS AND LEASEHOLD INTERESTS

Section 2.1 Assignment of Production Proceeds. As further security for the payment and performance of the Obligations, the Trustor hereby absolutely and unconditionally assigns and transfers to the Beneficiary, effective upon and during the continuance of an Event of Default, all Minerals (and the Proceeds therefrom) which are produced, extracted or severed from or attributable to the Lands and, effective automatically upon and during the continuance of an Event of Default, the Trustor hereby transfers, assigns, warrants and conveys to the Beneficiary all Minerals (and the Proceeds therefrom) which are produced, extracted or severed from or attributable to the Lands. Upon the occurrence and during the continuance of an Event of Default, all persons producing, purchasing or receiving such Minerals or the Proceeds therefrom are authorized and directed to treat the Beneficiary as the person entitled in the Trustor’s place and stead to receive the same; and further, those persons will be fully protected in so treating the Beneficiary and will be under no obligation to see to the application by Beneficiary of any Proceeds received by it. The Trustor agrees that, if, after the occurrence and during the continuance of an Event of Default, any Proceeds from such Minerals are paid to the Trustor, such proceeds shall constitute trust funds in the hands of the Trustor, shall be segregated from all other funds of the Trustor and separately held by the Trustor, and shall be forthwith paid over by the Trustor to the Beneficiary. Upon the occurrence and during the continuance of an Event of Default, the Trustor shall, if and when requested by the Beneficiary, execute and file with any production purchaser a transfer order or other instrument declaring the Beneficiary to be entitled to the Proceeds of severed Minerals and instructing such purchaser to pay such Proceeds to the Beneficiary. After the occurrence and during the continuance of an Event of Default, should any purchaser fail to make payment promptly to the Beneficiary of the proceeds derived from the sale thereof, the Beneficiary shall have the right, subject only to any contractual rights of such purchaser or any operator, to designate another purchaser to purchase and take such Products, without liability of any kind on the Beneficiary in making such selection so long as ordinary care is used in respect thereof.

Section 2.2 Assignment of Rents and Leasehold Interests. As further security for the payment and performance of the Obligations, the Trustor hereby absolutely and unconditionally assigns and transfers to Trustee, for the benefit of the Beneficiary, all the leases, income, rent, issues, deposits, profits and proceeds of the Lands and the Improvements to which the Trustor may be entitled, whether now due or to become due, and hereby gives to and confers upon the Trustee the right, power and authority to collect such income, rents, issues, deposits, profits and proceeds of the Lands and the Improvements to which the Trustor may be entitled, whether now due, past due or to become due. This assignment constitutes an irrevocable direction and authorization of all tenants, account payors and other Persons, under any lease, contract, agreement or other Instrument to pay all income, rent, issues, deposits, profits and proceeds into an account specified by the Trustee upon demand and without further consent or other action by the Trustor.

Section 2.3 Power-of-Attorney; Collection. The Trustor hereby irrevocably appoints the Trustee its true and lawful attorney, at the option of the Trustee upon the occurrence and during the continuance of an Event of Default, to demand, receive and enforce payment, to give receipts, releases, and satisfactions, and to sue, either in the name of the Trustor or in the name of the Trustee, for all such income, rents, issues, deposits, profits and proceeds and apply the same to the Obligations secured hereby. It is understood and agreed that neither the foregoing assignments in Sections 2.1 and 2.2 nor the exercise by the Trustee of any of its rights or remedies under this Article 2 or otherwise hereunder shall be deemed to make the Trustee a “mortgagee-in-possession” or otherwise responsible or liable in any manner with respect to the Collateral or the use, occupancy, enjoyment, or operation of all or any portion thereof. Notwithstanding anything to the contrary contained herein, so long as no Event of Default shall have occurred and be continuing, the Trustor shall have a license to collect all Proceeds from the Collateral as trustee for the benefit of the Trustee and shall apply such Proceeds in the following order of priority: (a) first, to the payment of the Obligations then due and payable, and (b) second, to such other obligations or matters as Trustor may reasonably determine. Upon the occurrence and during the continuance of an Event of Default, such license shall be deemed automatically revoked and any income, rents, issues, deposits, profits and proceeds received thereafter by the Trustor shall be delivered in kind to the Trustee. The Trustor hereby irrevocably constitutes and appoints the Trustee its true and lawful attorney-in-fact to enforce in the Trustor’s name or in the Beneficiary’s name or otherwise all rights of the Trustor and to do any and all things necessary and proper to carry out and implement the purposes hereof, which Trustee may exercise at any time after the occurrence and during the continuance of an Event of Default.

Section 2.4 Trustor’s Payment Duties. Nothing contained herein will limit the Trustor’s duty to make payment on the Obligations when the Proceeds received pursuant to this Article 2 are insufficient to pay the costs, interest, principal and any other portion of the Obligations then owing, and the receipt of Proceeds pursuant hereto will be in addition to all other security now or hereafter existing to secure payment of the Obligations.

Section 2.5 Liability of Trustee and Beneficiary. Neither the Trustee nor the Beneficiary has any obligation to enforce collection of any of the Proceeds or other amounts described in this Article 2, and the Trustee and the Beneficiary are hereby released from all liability and responsibility in connection therewith, except the responsibility to account to Trustor for Proceeds and other amounts actually received.

Section 2.6 Indemnification. The Trustor agrees to indemnify and save and hold harmless the Trustee, the Beneficiary, their respective successors and affiliates and their respective directors, partners, managers, principals, officers, employees, agents, consultants and representatives (collectively, the “Indemnified Parties”) from and against all claims, actions, liabilities, losses, judgments, reasonable attorneys’ fees, costs and expenses and other charges of any description whatsoever (all of which are hereafter referred to in this Section 2.6 as “Claims”) made against or sustained or incurred by any such Indemnified Party as a consequence of the assertion, either before or after the payment in full of the Obligations, that the Beneficiary received Minerals, Proceeds or rents, profits, income or proceeds of Collateral pursuant to this instrument, except to the extent any Claims arise out of any Indemnified Party’s gross negligence or willful misconduct. The Indemnified Parties have the right to employ attorneys and to defend against any Claims and unless furnished with satisfactory indemnity, after notice to the Trustor, the Indemnified Parties will have the right to pay or compromise and adjust all Claims in its sole reasonable discretion. The Trustor shall indemnify and pay to the Indemnified Parties all amounts paid by any Indemnified Party in compromise or adjustment of any of the Claims or amounts adjudged against any Indemnified Party in respect of any of the Claims. The liabilities of Trustor as set forth in this Section 2.6 will constitute Obligations and will survive the termination of this instrument.

ARTICLE 3 – TRUSTOR’S REPRESENTATIONS AND WARRANTIES

The Trustor hereby represents and warrants as follows (except as set forth in, and subject to the disclosures in, the Loan Agreement and the Schedules thereto): Section 3.1 Due Organization, Good Standing and Authority. The Trustor is duly organized, validly existing and in good standing under the laws of Delaware and is qualified to do business in Arizona and every other jurisdiction where necessary in light of its business and properties. The Trustor has full power, authority and legal right (i) to own or lease its assets and properties (including the Lands) and to conduct its business as now being conducted, and (ii) to enter into its obligations under this Deed of Trust and each other agreement, document and instrument executed or to be executed by it pursuant hereto or in connection herewith and to perform the terms hereof and thereof applicable to it.

Section 3.2 Authorization and No Conflict. The execution and delivery by the Trustor of this Deed of Trust, and the performance of all transactions contemplated hereby and the fulfillment of and compliance with the terms of this Deed of Trust, have been duly authorized by all necessary action, corporate, partnership or otherwise, and do not and will not (i) conflict with or result in a breach of the terms, conditions or provisions of, (ii) constitute a default under, (iii) give any third party any right to accelerate any obligation under, (iv) result in a violation of, or (v) require any authorization, consent, approval, exemption or other action by or notice to any court or administrative or governmental body pursuant to (A) the operating agreement or other constating documents of the Trustor, (B) any law, statute or rule, or (C) any agreement, instrument, order, judgment or decree to which the Trustor is subject or by which any of its properties are bound.

Section 3.3 No Approvals. No authorization or approval or other action by, and no notice to or filing with, any governmental authority, regulatory body or other person or entity is required for the due execution, delivery and performance by the Trustor under this Deed of Trust.

Section 3.4 Validity. This Deed of Trust is, and when delivered hereunder will be, the legal, valid and binding obligation of the Trustor enforceable against the Trustor in accordance with its terms, subject to applicable bankruptcy, reorganization, insolvency or similar laws affecting the enforcement of creditors’ rights generally and by general principles of equity (regardless of whether enforcement is sought in equity or law).

Section 3.5 Name and Location of Office. The Trustor has not used any corporate name or done business under any name other than its own, and the Trustor further covenants and agrees that it will not do so, nor will it change its state of organization outside of the State of Delaware or relocate its chief executive office outside of the State of New Mexico without at least thirty days’ prior notice to the Trustee and the Beneficiary.

Section 3.6 Litigation. There is no action, suit or proceeding at law or in equity, by or before any governmental or regulatory authority, court, arbitral tribunal or other body now pending (or, to the knowledge of the Trustor, threatened) against or affecting the Trustor, the Lands, Minerals or any of the other Collateral which may materially adversely impact the Trustor or its business or the Lands or otherwise affect the legality, validity or enforceability of this Deed of Trust.

Section 3.7 Title.

(a) Exhibit A attached hereto and incorporated herein accurately and completely sets forth and describes all real property owned, held or controlled by the Trustor, including all fee interests, patented mining claims, unpatented mining claims, unpatented millsite claims, leasehold interests, option rights and other real property interests, and such Exhibit A is in a form that, when appended to this instrument, is adequate and sufficient for acceptance by Maricopa County and Yavapai County, Arizona for the recording of real property instruments.

(b) The Trustor has good and marketable title to an undivided one hundred percent (100%) of all fee lands, patented mining claims, and unpatented mining claims and millsite claims set forth on Exhibit A to this Deed of Trust, which title is, subject to Permitted Liens, superior and paramount to any adverse claim or right of title which may be asserted, subject only to the paramount title of the United States as to any unpatented mining claims and millsite claims and the rights of third parties to the lands within such unpatented mining claims pursuant to the Multiple Mineral Development Act of 1954 and the Surface Resources and Multiple Use Act of 1955. With respect to any lease or option to purchase identified on Exhibit A, each such lease creates a valid and subsisting leasehold estate in the lands described in such lease and each option creates a valid right to purchase the lands described in such option, each such lease and option is in full force and effect, no event has occurred that, with the giving of notice or the passage of time, would constitute a default under such lease or option and all rent, royalties or other payments due under such lease or option have been timely paid;

(c) With respect to the unpatented mining claims and unpatented millsite claims listed on the attached Exhibit A: (A) the Trustor is in exclusive possession thereof, free and clear of all Liens, claims, encumbrances or other burdens on production, other than Permitted Liens; (B) all such claims were located, staked, filed and recorded on available public domain land in compliance with all applicable state and federal laws and regulations; (C) assessment work, intended in good faith to satisfy the requirements of state and federal laws and regulations and generally regarded in the mining industry as sufficient, for all assessment years up to and including the assessment year ending September 1, 1992, was timely and properly performed on or for the benefit of the claims, and affidavits evidencing such work were timely recorded; (D) claim rental and maintenance fees required to be paid under federal law in lieu of the performance of assessment work, in order to maintain the claims commencing with the assessment year ending on September 1, 1993 and through the assessment year ending on September 1, 2011, have been timely and properly paid, and affidavits or other notices evidencing such payments and required under federal or state laws or regulation have been timely and properly filed and recorded; (E) all filings with the BLM with respect to such claims which are required under FLPMA have been timely and properly made; and (F) there are no actions or administrative or other proceedings pending or to the best of the Trustor’s knowledge threatened against or affecting any of the claims. Nothing herein shall be deemed a representation that any unpatented mining claim contains a discovery of valuable minerals or that any unpatented millsite claim is located on non-mineral land. In addition, with respect to each of the unpatented mining claims listed on Exhibit A, the Trustor represents that, to its knowledge, such unpatented mining claims have been relocated or remonumented as necessary, and that evidence of such relocation or remonumentation has been timely and properly recorded, all in compliance with the provisions of A.R.S. § 27-201 et seq.;

(d) As to the patented mining claims listed on Exhibit A: (A) the Trustor owns an undivided one hundred percent (100%) interest in those claims free and clear of all liens, claims, encumbrances, royalties or other burdens on production, except for Permitted Liens; (B) the Trustor is in exclusive possession of those claims; and (C) there are no actions or administrative or other proceedings pending or to the Trustor’s knowledge threatened against those claims;

(e) The Trustor has good and marketable title to the Improvements and the Personal Property. The Lands, the Improvements located thereon, the Minerals and the Personal Property constitute all of the properties and assets, tangible or intangible, real or personal, which are used in the conduct of the business of the Trustor, as such business is presently being conducted and as pertains to the Lands. No other material properties or assets, whether or not owned by the Trustor, are required for the operation of such business or the Lands as presently being operated or developed. All such properties and assets are owned free and clear of all clouds to title and of all Liens, except Permitted Liens or Liens permitted under the provisions of this Deed of Trust. All Improvements and Personal Property owned or held by the Trustor are in a state of repair adequate for normal operations and are in all material respects in good working order and condition for the conduct of the business of the Trustor as such business is presently being conducted.

Section 3.8 Leases and Royalties. The Lands and Minerals are not subject to any leases or other agreements burdening or otherwise associated with such Lands, and, there are no Royalties (as defined below) burdening or otherwise associated with such Lands or Minerals. For purposes hereof, “Royalties” shall mean any amount payable as a share of the product or profit from the Lands or any Minerals produced therefrom and includes without limitation, production payments, net profits interests, net smelter return royalties, landowner’s royalties, minimum royalties, overriding royalties and royalty bonuses.

Section 3.9 Transportation, Utilities and Water Supply. All utility services, means of transportation, ingress and egress roadways, easements, servitudes, rights of passage, facilities, water rights and other materials necessary for the operation of and access to the Lands (including, without limitation, gas, electrical, water supply and sewage services and facilities) are available on commercially reasonable terms in compliance with all applicable legal requirements, and the Trustor is not aware of any information that would lead it to believe that any of the foregoing will not be available in the future.

Section 3.10 Payment of Taxes. The Trustor has filed or caused to be filed all federal, state and local tax returns which to the knowledge of the Trustor are required to be filed and has paid or caused to be paid all taxes as shown on such returns or any assessment received by the Trustor to the extent that such taxes or assessments have become due, except such as may be diligently contested in good faith and by appropriate proceedings or as to which a bona fide dispute may exist and for which adequate reserves are being maintained.

Section 3.11 Compliance with Laws. With respect to the Lands and operations thereon, the Trustor has complied in all material respects with all applicable local, state and federal laws, including Environmental Laws (as defined in the Loan Agreement), and regulations relating to the operation of the Lands, and the Trustor is not aware of any investigation (other than a routine inspection) of the Trustor or the Lands by any local, state or federal agency with respect to enforcement of such laws and regulations. The existing and planned use of the Black Canyon Mica Operation complies or will comply with all applicable legal requirements, including but not limited to applicable regulations and restrictive covenants affecting the Lands, as well as all environmental, ecological, landmark and other applicable laws and regulations; and all requirements for such use have been satisfied to the extent necessary for the current operations involving the Lands. No release, emission or discharge into the environment of hazardous substances, as defined under any Environmental Law, has occurred or is presently occurring or will occur in operating the Black Canyon Mica Operation in its intended form in excess of federally or state permitted releases or reportable quantities, or other concentrations, standards or limitations under the foregoing laws or under any other federal, state or local laws, regulations or governmental approvals in connection with the construction, operation, ore treatment, heap leaching, fuel supply, power generation and transmission or waste disposal, or any other operations or processes relating to the Black Canyon Mica Operation, other than as allowed by or in compliance with applicable federal, state and local laws. The Lands and the Trustor’s use and proposed use thereof are not and will not be in violation of any environmental, occupational safety and health or other applicable law now in effect, the effect of which violation, in any case or in the aggregate, would materially adversely affect the Lands or the Trustor’s use thereof, or which, in any case or in the aggregate, would impose a material liability on the Trustee or the Beneficiary or jeopardize the interest of the Trustee or the Beneficiary in the Collateral. The Trustor has no knowledge of any past or existing violations of any such laws, ordinances or regulations issued by any governmental authority.

Section 3.12 Permits Affecting Properties. The Trustor has obtained all licenses, operating bonds, permits, authorizations and approvals from all governments, governmental commissions, boards and other agencies required in respect of its present use of and operations on the Lands.

ARTICLE 4 – COVENANTS

Section 4.1 Affirmative Covenants. The Trustor covenants and agrees that so long as any of the Obligations secured hereby remain unpaid or outstanding (except as specifically set forth in the Loan Agreement):

(a) Due Payment. The Trustor will promptly pay when due, or within any applicable grace periods with respect thereto, any and all amounts for which it is obligated under the terms of the Loan Agreement, this Deed of Trust and each other Credit Document and will comply with all of the terms and provisions thereof and hereof;

(b) Perfection; Maintenance of Liens. The Trustor shall promptly, at the Trustor’s own expense and insofar as not contrary to applicable law, execute such documents and provide such authorizations as Beneficiary may request so that Beneficiary may file and refile in such offices, at such times and as often as may be necessary, any instrument as may be necessary to create, perfect, maintain and preserve the lien and security interest intended to be created hereby and the rights and remedies hereunder; shall promptly furnish to the Trustee evidence satisfactory to the Trustee of all such filings and refilings; and otherwise shall do all things necessary or expedient to be done to effectively create, perfect, maintain and preserve the liens and security interests intended to be created hereby as a valid lien of first priority on real property and fixtures and a perfected security interest in personal property and fixtures, subject to Permitted Liens. The Trustor hereby authorizes the Trustee and the Beneficiary to file this Deed of Trust and one or more financing or continuation statements, and amendments thereto, relative to any or all of the Collateral;

(c) Maintenance of Lands. The Trustor will (i) cause each of the Water Rights and Access Rights owned, held or hereafter acquired by or for the Trustor and necessary or appropriate to the operation of a mine or mines upon the Lands to be kept in full force and effect by the payment of whatever sums may become payable and by the fulfillment of whatever other obligations, and the performance of whatever other acts may be required to the end that forfeiture or termination of each such interest shall be prevented unless the termination, forfeiture or other relinquishment of the interest is authorized by any operating plan or plan of operations then in effect thereunder, (ii) conduct all drilling, mining, exploratory work and related operations and activities in accordance with applicable federal, state and local laws and good and minerlike practice, (iii) maintain the Trustor as the sole owner of, and retain exclusive possession of, all mining and millsite claims, free and clear of all Liens, subject only to the paramount title of the United States and Permitted Liens, (iv) timely pay all required federal claim maintenance fees, and timely record and file in the appropriate county and federal offices adequate affidavits and notices of timely payment of such fees, and amend, relocate, and locate new mining claims with respect to those unpatented mining claims as reasonably necessary to protect the Trustor’s and the Trustee’s interest in the Collateral, (v) timely make all payments and perform all obligations to prevent the forfeiture or termination of any portion of the Lands, (vi) permit the Trustee and the Beneficiary, through their employees, representatives and agents, to enter upon the Lands at any time, subject to appropriate safety procedures, for the purpose of investigating and inspecting the condition and operation of the Collateral, and do all other things necessary or proper to enable the Trustee and the Beneficiary to exercise this right upon reasonable notice at such times as the Trustee or the Beneficiary may reasonably request, and (vii) do all other things necessary to preserve and maintain the right, title and interest of the Trustee and the Beneficiary in the Collateral. The Trustor shall not abandon all or any portion of the Lands that is producing or capable of commercial production or forfeit, surrender or release any lease, sublease, operating agreement or other agreement or instrument comprising or affecting the Collateral;

(d) Maintenance of Unpatented Claims. To the extent not otherwise addressed herein, the Trustor covenants and agrees to timely pay all claim maintenance fees, to timely make all filings and recordings, including affidavits of payment, and to otherwise timely take all other necessary actions and pay such amounts relating to the preservation, maintenance, continuance and validity of unpatented mining claims and unpatented millsite claims as may be required by any federal, state or local governmental authority, including payment of claim maintenance fees to the U.S. Bureau of Land Management on or before July 15^th of each year. The Trustor further covenants and agrees to provide the Beneficiary, on or before August 1 of each year, written notice and evidence of the payment of such claim maintenance fees for such unpatented claims. In the event that the Beneficiary has not received the notice and evidence described in the preceding sentence by August 1, the Trustee or the Beneficiary may, on behalf of the Trustor, make and pay any claim maintenance fees, in which event the Trustor shall promptly reimburse the Trustee and the Beneficiary for any such fees, with interest at the rate set forth in the Loan Agreement, in addition to any costs and expenses incurred in making such payments, and all such amounts shall be Obligations hereunder;

(e) Maintenance of Collateral. The Trustor will keep all Improvements, Personal Property, inventory and fixtures of every kind now or hereafter included in the Collateral in good working order and condition (ordinary wear and tear excepted), and all repairs, renewals, replacements, additions, substitutions and improvements needful to such end shall be promptly made. The Trustor will comply fully with all of the terms and conditions of all leases, agreements and other instruments of title and all Access Rights and privileges necessary for the proper operation of such leases and instruments, and otherwise do all things necessary to keep Trustor’s rights and Beneficiary’s interest in the Collateral unimpaired;

(f) Compliance with Laws and Permits. The Trustor will (i) comply with all lawful rulings and regulations of each regulatory authority having jurisdiction over the Trustor or the Lands; (ii) conduct any and all operations and activities on the Lands in compliance with applicable federal, state and local laws, rules and regulations and with all Permits; (iii) reclaim the Lands in accordance with applicable federal, state and local laws, rules and regulations and all Permits; and (iv) obtain and maintain in full force and effect all Permits necessary or appropriate for the use or operation of the Collateral or activities on the Lands, in each case as currently conducted;

(g) Payment of Obligations. The Trustor will pay when due all liabilities and obligations of any nature, including all liabilities and obligations for labor, material, equipment and contracted services, incurred in or arising from the administration, operation or use of the Lands and the other Collateral;

(h) Protection of Collateral. The Trustor will protect every part of the Collateral from removal, destruction and damage, and will protect same from the doing or suffering to be done of any act, other than the use of the Collateral as hereby contemplated, whereby the value of the Collateral may be lessened;

(i) Insurance. The Trustor will carry (i) workmen’s compensation insurance covering persons who are employed by or for the benefit of the Black Canyon Mica Operation in compliance with applicable laws, and (ii) other insurance as required by the Credit Documents;

(j) Further Assurances. The Trustor shall execute, acknowledge and deliver to the Trustee and the Beneficiary all and any such other and further instruments, documents and certificates and do and perform such other acts as in the opinion of the Trustee or the Beneficiary may be necessary or desirable to implement, effect and maintain the intent of this Deed of Trust, upon the reasonable request of the Trustee or the Beneficiary, and at the Trustor’s expense;

(k) Defend Title. The Trustor warrants and shall forever defend the Collateral against every person whomsoever lawfully claiming the same or any part thereof, and the Trustor shall maintain and preserve the lien and security interest herein created until this instrument has been terminated and released as provided herein. If the title or the right of the Trustor or the Trustee or the Beneficiary to the Lands, Minerals or any other Collateral or any part thereof shall be challenged or attacked, either directly or indirectly, or if any legal proceedings are commenced against the Trustor or all or any portion of the Lands, the Trustor shall promptly give written notice thereof to the Trustee and, at the Trustor’s own expense, shall proceed diligently to defend against any such attack or proceedings, and the Trustee and the Beneficiary may take such independent action in connection therewith as either of them may, in its reasonable discretion, deem advisable to protect its interest in the Collateral, and all costs, expenses and reasonable attorneys’ fees incurred by the Trustee or the Beneficiary in connection therewith shall be a demand obligation owing by the Trustor, and shall bear interest at the rate specified in the Loan Agreement from the date such expenses are incurred until paid, and shall be part of the Obligations;

(l) Change in General Mining Law. In the event of the repeal or modification of the current General Mining Law of 1872 during the term of this Deed of Trust, such that the interest of the Trustor in those lands which are material to the exploration, development or operation of the Lands is affected, modified or transformed, the Trustor will use its best efforts to retain its interest in those lands and will consult with the Trustee and the Beneficiary to determine how best to preserve the interest of the Trustor and the interest of the Trustee and the Beneficiary in the affected Collateral, and the Trustor shall take no action, which in the reasonable opinion of the Trustee or the Beneficiary or their counsel could adversely affect or impair their interest in the Collateral or under this Deed of Trust;

(m) Information. The Trustor shall promptly furnish to the Trustee and the Beneficiary such information concerning the Trustor, the Trustor’s business affairs and financial condition, the Collateral and the operations and financial condition of the Trustor, as the Trustee or the Beneficiary may reasonably request; and

(n) Access. The Trustor shall keep proper books, records and accounts in which complete and correct entries shall be made of the Trustor’s transactions in accordance with generally accepted accounting principles, and shall keep the records concerning the accounts and contract rights included in the Collateral at the Trustor’s place of business, and the Trustee and the Beneficiary shall have the right to inspect such records, and the Trustor shall furnish copies upon reasonable request and upon reasonable notice in accordance with the Loan Agreement.

Section 4.2 Negative Covenants. The Trustor covenants and agrees that, so long as any of the Obligations secured hereby remains unpaid or outstanding, the Trustor shall not, either directly or indirectly:

(a) No Disposition of Assets. Except as permitted under the Loan Agreement, sell, transfer, assign, convey or otherwise dispose of all or any part of the Collateral;

(b) No Debt. Except as permitted under the Loan Agreement, incur, create, issue, assume or permit any borrowing or indebtedness to exist or incur, create or enter into any guaranty of any obligation of any other person or entity;

(c) No Liens. Except as permitted under the Loan Agreement, incur, create, grant, assume, allow or suffer to exist any Lien on all or any part of the Lands, Minerals or any other Collateral, except Permitted Liens; or

(d) Changes in Business. Except as permitted under the Loan Agreement, liquidate or dissolve, or enter into any consolidation, merger, amalgamation, or sale or enter into any partnership, joint venture or other combination, where such transaction involves a contribution by the Trustor of all or a significant portion of the Collateral, or sell, lease or dispose of its business or the assets of the Trustor.

ARTICLE 5 – DEFAULT

The occurrence of any one or more of the following events in Section 5.1(a) through Section 5.1(f) shall constitute an “Event of Default”: Section 5.1 Events of Default. The term “Event of Default” shall have the meaning given thereto in the Loan Agreement and each other Credit Document, but shall also include the occurrence or the existence of any of the following conditions:

(a) The failure by the Trustor to keep, punctually perform, or observe any of the covenants, agreements, obligations or prohibitions contained herein, in the Loan Agreement, in any Credit Document, in any other written instrument evidencing any of the Obligations or in any other agreement with the Trustee or the Beneficiary (whether now existing or entered into hereafter), and such failure remains unremedied for a period of five Business Days; or

(b) This Deed of Trust or any other collateral security granted by the Trustor with respect to the Obligations shall fail to constitute a valid and enforceable, perfected first priority security interest in or lien on any Collateral for any reason, subject to any Permitted Liens, or Trustor shall so state in writing or Trustor or any other Person shall take or agree to take any action threatening the validity, perfection or priority of any such security interest; or

(c) (i) The Trustor shall initiate or commence any case, proceeding or other action (A) under any existing or future bankruptcy or insolvency law, or otherwise seek to have it judged bankrupt or insolvent, or seek reorganization, arrangement, adjustment, winding-up, liquidation, dissolution, composition or other relief with respect to it or its debts, or (B) any such case, proceeding or other action shall seek appointment of a receiver, trustee, custodian, administrator, conservator or other similar official for it or for all or any substantial part of its assets, or the Trustor shall make a general assignment for the benefit of its creditors; or (ii) there shall be commenced against the Trustor any case, proceeding or other action of a nature referred to in clause (i) above which (A) results in the entry of an order for relief or any such adjudication or appointment or (B) remains undismissed, undischarged or unbonded for a period of sixty (60) days; or (iii) there shall be commenced against the Trustor any case, proceeding or other action seeking issuance of a warrant of attachment, execution, distraint or similar process against all or any substantial part of their assets which results in the entry of an order for any such relief which shall not have been vacated, discharged, or stayed or bonded pending appeal within sixty (60) days from the entry thereof; or (iv) the Trustor shall take any action in furtherance of, or indicating its consent to, approval of, authorization of, or acquiescence in, any of the acts set forth in clause (i), (ii), or (iii) above; or (v) the Trustor generally shall not, or shall be unable to, or shall admit in writing its inability to, pay its debts as they become due; or

(d) Any governmental authority shall condemn, seize or appropriate all or any portion of the Collateral that is material to the financial condition, business or operations of the Trustor or the Black Canyon Mica Operation; or

(e) The voluntary or involuntary dissolution, merger, consolidation, winding up or reorganization of Trustor or the occurrence of any action preparatory thereto.

(f) The assertion (except by the owner of an encumbrance expressly excepted from the Trustor’s warranty of title herein) of any claim of priority over this instrument, by title, lien or otherwise, unless the Trustor within 30 days after such assertion either causes the assertion to be withdrawn or provides the Beneficiary with such further or additional security as the Beneficiary may require to protect the Beneficiary against all loss, damage, or expense, including attorneys’ fees, which the Beneficiary may incur in the event such assertion is upheld.

Section 5.2 Acceleration Upon Default. Upon the occurrence of any Event of Default, or at any time thereafter during the continuance of an Event of Default, the Beneficiary may, at its option, by notice to the Trustor, declare all Obligations to be due and payable forthwith without any further notice, presentment or demand of any kind, all of which are hereby expressly waived.

Section 5.3 Possession and Operation of Property. Upon the occurrence of any Event of Default, or at any time thereafter during the continuance of an Event of Default, and in addition to all other rights therein conferred on the Trustee or the Beneficiary, the Trustee, the Beneficiary or any person, firm or corporation designated by Beneficiary, will have the right and power, but will not be obligated, to have an audit performed, at Trustor’s expense, of the books and records of Trustor, and to enter upon and take possession of all or any part of the Collateral, to exclude Trustor therefrom, and to hold, use, administer and manage the same to the extent that Trustor could do so. The Trustee, the Beneficiary or any person, firm or corporation designated by the Beneficiary, may manage the Collateral, or any portion thereof, without any liability to the Trustor in connection with such management except with respect to gross negligence or willful misconduct; and the Trustee, the Beneficiary or any person, firm or corporation designated by the Beneficiary will have the right to collect, receive and receipt for all Minerals produced and sold from the Lands, and to exercise every power, right and privilege of the Trustor with respect to the Collateral. Providing there has been no foreclosure sale, when and if the expenses of the management of the Collateral have been paid and the Obligations paid in full, the remaining Collateral shall be returned to the Trustor.

Section 5.4 Ancillary Rights. Upon the occurrence of an Event of Default, or at any time thereafter during the continuance of an Event of Default, and in addition to all other rights of the Beneficiary hereunder, the Beneficiary may, without notice, demand or declaration of default, all of which are hereby expressly waived by the Trustor, proceed by a suit or suits in equity or at law (i) for the seizure and sale of the Collateral or any part thereof, (ii) for the specific performance of any covenant or agreement herein contained or in aid of the execution of any power herein granted, (iii) for the foreclosure or sale of the Collateral or any part thereof under the judgment or decree of any court of competent jurisdiction, (iv) without regard to the solvency or insolvency of any person, and without regard to the value of the Collateral, and without notice to Trustor (notice being hereby expressly waived), for the ex parte appointment of a receiver to serve without bond pending any foreclosure or sale hereunder, or (v) for the enforcement of any other appropriate legal or equitable remedy.

Section 5.5 Availability of Rights and Remedies; Cumulative Rights and Remedies. Upon the occurrence of an Event of Default, or at any time thereafter during the continuance of an Event of Default, all of the rights and remedies provided to the Trustee or the Beneficiary in this Deed of Trust and each other collateral security documents shall immediately become available to the Trustee and the Beneficiary, and the Trustee and the Beneficiary shall have all other rights and remedies available at law or in equity. All rights and remedies of the Trustee and the Beneficiary set out in this Deed of Trust, each other collateral security document and as otherwise available are cumulative, and no right or remedy contained herein or therein is intended to be exclusive; each such right and remedy is in addition to every other right and remedy contained in this Deed of Trust, each other collateral security document or in any existing or future agreement or now or in the future existing at law, in equity, by statute or otherwise. Every right, power and remedy given by this Deed of Trust to the Trustee or the Beneficiary or to which either of them may be otherwise entitled, may be exercised concurrently or independently, from time to time and as often as may be deemed expedient by the Trustee or the Beneficiary, and either of them may pursue inconsistent remedies.

ARTICLE 6 – BENEFICIARY’S RIGHTS AS TO REALTY COLLATERAL UPON DEFAULT

Section 6.1 Deed of Trust or Mortgage. The Beneficiary may elect to treat this instrument as either a deed of trust or as a mortgage, but not both. Upon the occurrence of an Event of Default, or at any time thereafter, the Beneficiary or the Trustee may declare all sums secured hereby immediately due and payable either by commencing an action to foreclose this Deed of Trust as a mortgage, or by the delivery to the Trustee of a written declaration of default and demand for sale and of written notice of default and of election to cause the Collateral to be sold, which notice the Trustee shall cause to be duly filed for record in case of foreclosure by exercise of the power of sale herein. The decision by the Beneficiary to pursue its remedies and foreclose either by acting under the Deed of Trust as a deed of trust by exercise of the power of sale (and as otherwise set forth herein) or by acting under the Deed of Trust as a mortgage by exercise of a judicial foreclosure (and as otherwise set forth herein) may be made by the Beneficiary at the Beneficiary’s sole option and discretion.

Section 6.2 Judicial Foreclosure. Upon the occurrence of an Event of Default, or at any time thereafter, in lieu of the exercise of the non-judicial power of sale hereafter given, the Beneficiary may, subject to any mandatory requirement of applicable law, proceed by suit to foreclose its lien hereunder and to sell or have sold the Collateral or any part thereof at one or more sales, as an entirety or in parcels, at such place or places and otherwise, in such manner and upon such notice as may be required by law, or, in the absence of any such requirement, as the Beneficiary may deem appropriate, and the Beneficiary shall thereafter make or cause to be made a conveyance to the purchaser or purchasers thereof. The Beneficiary may postpone the sale of the real property included in the Collateral or any part thereof by public announcement at the time and place of such sale, and from time to time thereafter may further postpone such sale by public announcement made at the time of sale fixed by the preceding postponement. Sale of a part of the real property included in the Collateral will not exhaust the power of sale, and sales may be made from time to time until all such property is sold or the Obligations are paid in full.

Section 6.3 Non-Judicial Foreclosure; Power of Sale. Upon the occurrence of an Event of Default, or at any time thereafter, the Trustee is hereby authorized and empowered, and it shall be its duty, upon request of the Beneficiary, and to the extent permitted by applicable law, to exercise the power of sale contained herein and sell any part of the Collateral at one or more sales, as an entirety or in parcels, at such place or places and otherwise in such manner and upon such notice as may be required by applicable law, or in the absence of any such requirement, as Trustee and/or Beneficiary may deem appropriate, and to make conveyance to the purchaser or purchasers thereof. Any sale shall be made to the highest bidder for cash at the door of the county courthouse of, or in such other place as may be required or permitted by applicable law in, the county in the state where the Collateral or any part thereof is situated; provided that and if the Collateral lies in more than one county, such part of the Collateral may be sold at the courthouse door of any one of such counties, and the notice so posted shall designate in which county such property shall be sold. Any such sale shall be made at public outcry, on the day of any month, during the hours of such day and after such written notices thereof have been publicly posted in such places and for such time periods and after all persons entitled to notice thereof have been sent such notice, all as required by applicable law in effect at the time of such sale. The affidavit of any person having knowledge of the facts to the effect that such a service was completed shall be prima facie evidence of the fact of service. The Trustor agrees that no notice of any sale, other than as required by applicable law, need be given by the Trustor, the Beneficiary or any other person. The Trustor hereby designates as its address for the purposes of such notice the address set out on page one hereof; and agrees that such address shall be changed only by depositing notice of such change enclosed in a postpaid wrapper in a post office or official depository under the care and custody of the United States Postal Service, certified mail, postage prepaid, return receipt requested, addressed to the Beneficiary or other holder of the Obligations at the address for the Beneficiary set out herein (or to such other address as the Beneficiary or other holder of the Obligations may have designated by notice given as above provided to the Trustor and such other debtors). Any such notice or change of address of the Trustor or other debtors or of the Beneficiary or of other holder of the Obligations shall be effective upon receipt. The Trustor authorizes and empowers the Trustee to sell the Collateral in lots or parcels or in its entirety as the Trustee shall deem expedient; and to execute and deliver to the purchaser or purchasers thereof good and sufficient deeds of conveyance thereto by fee simple title, with evidence of general warranty by the Trustee, and the title of such purchaser or purchasers when so made by the Trustee, the Trustor binds itself to warrant and forever defend, subject to Permitted Liens and the paramount ownership of the United States as to any unpatented mining or millsite claims. Where portions of the Collateral lie in different counties, sales in such counties may be conducted in any order that the Trustee may deem expedient; and one or more such sales may be conducted in the same month, or in successive or different months as the Trustee may deem expedient.

ARTICLE 7 – BENEFICIARY’S RIGHTS AS TO PERSONALTY AND FIXTURE COLLATERAL UPON DEFAULT

Section 7.1 Personalty Collateral. Upon the occurrence of an Event of Default, or at any time thereafter during the continuance of an Event of Default, the Beneficiary may, without notice to the Trustor, exercise its rights to declare all of the Obligations to be immediately due and payable, in which case the Beneficiary will have all rights and remedies granted by law, and particularly by the UCC, including, but not limited to, the right to take possession of any and all Collateral constituting personal property (the “Personalty Collateral”), and for this purpose the Beneficiary may enter upon any premises on which any or all of the Personalty Collateral is situated and take possession of and operate the Personalty Collateral or remove it therefrom. The Beneficiary may require the Trustor to assemble the Personalty Collateral and make it available to the Beneficiary or the Trustee at a place to be designated by Beneficiary which is reasonably convenient to all parties. Unless the Personalty Collateral is perishable or threatens to decline speedily in value or is of a type customarily sold on a recognized market, the Beneficiary will give the Trustor reasonable notice of the time and place of any public sale or of the time after which any private sale or other disposition of the Personalty Collateral is to be made. This requirement of sending reasonable notice will be met if the notice is mailed, postage prepaid, to the Trustor at the address designated above at least ten (10) days before the time of the sale or disposition.

Section 7.2 Sale with Realty Collateral. In the event of foreclosure, whether judicial or non-judicial, at the Beneficiary’s option it may proceed under the UCC as to the Personalty Collateral or it may proceed as to both Personalty Collateral and Collateral constituting real property in accordance with its rights and remedies in respect of the Collateral constituting real property.

Section 7.3 Private Sale. If the Beneficiary in good faith believes that any state or federal law prohibits or restricts the customary manner of sale or distribution of any of the Personalty Collateral, or if the Beneficiary determines that there is any other restraint or restriction limiting the timely sale or distribution of any such property in accordance with the customary manner of sale or distribution, the Beneficiary may sell or may cause the Trustee to sell such property privately or in any other manner it deems advisable at such price or prices as it determines in its sole discretion and without any liability whatsoever to the Trustor in connection therewith. The Trustor recognizes and agrees that such prohibition or restriction may cause such property to have less value than it otherwise would have and that, consequently, such sale or disposition by the Beneficiary may result in a lower sales price than if the sale were otherwise held.

ARTICLE 8 – OTHER PROVISIONS CONCERNING FORECLOSURE

Section 8.1 Possession and Delivery of Collateral. It shall not be necessary for the Beneficiary or the Trustee to have physically present or constructively in its possession any of the Collateral at any foreclosure sale, and the Trustor shall deliver to the purchasers at such sale on the date of sale the Collateral purchased by such purchasers at such sale, and if it should be impossible or impracticable for any of such purchasers to take actual delivery of the Collateral, then the title and right of possession to the Collateral shall pass to the purchaser at such sale as completely as if the same had been actually present and delivered.

Section 8.2 Beneficiary as Purchaser. The Beneficiary will have the right to become the purchaser at any foreclosure sale, and it will have the right to credit upon the amount of the bid the amount payable to it out of the net proceeds of sale.

Section 8.3 Recitals Conclusive; Ratification. Recitals contained in any conveyance to any purchaser at any sale made hereunder will conclusively establish the truth and accuracy of the matters therein stated, including, without limiting the generality of the foregoing, nonpayment of the unpaid principal sum of, and the interest accrued on, the written instruments constituting part or all of the Obligations after the same have become due and payable, nonpayment of any other of the Obligations or advertisement and conduct of the sale in the manner provided herein, and appointment of any successor Trustee hereunder. The Trustor ratifies and confirms all legal acts that Beneficiary and/or Trustee may do in carrying out the provisions of this instrument.

Section 8.4 Effect of Sale. Any sale or sales of the Collateral or any part thereof will operate to divest all right, title, interest, claim and demand whatsoever, either at law or in equity, of the Trustor in and to the premises and the property sold, and will be a perpetual bar, both at law and in equity, against the Trustor, Trustor’s successors or assigns and against any and all persons claiming or who shall thereafter claim all or any of the property sold from, through or under the Trustor, or Trustor’s successors or assigns. Subject to applicable rights of redemption under applicable law, the purchaser or purchasers at the foreclosure sale will receive immediate possession of the property purchased; and if the Trustor retains possession of the Collateral, or any part thereof, subsequent to sale, the Trustor will be considered a tenant at sufferance of the purchaser or purchasers, and if the Trustor remains in such possession after demand of the purchaser or purchasers to remove, the Trustor will be guilty of forcible detainer and will be subject to eviction and removal, forcible or otherwise, with or without process of law, and without any right to damages arising out of such removal.

Section 8.5 Application of Proceeds. The proceeds of any sale of the Collateral or any part thereof will be applied as follows:

(a) first, to the payment of all out of pocket expenses incurred by the Trustee and Beneficiary in connection therewith, including, without limiting the generality of the foregoing, reasonable court costs, legal fees and expenses, fees of accountants, engineers, consultants, agents or managers and expenses of any entry or taking of possession, holding, valuing, preparing for sale, advertising, selling and conveying;

(b) second, to the payment of the Obligations; and

(c) third, any surplus thereafter remaining to Trustor or Trustor’s successors or assigns, as their interests may be established to Beneficiary’s reasonable satisfaction.

Section 8.6 Deficiency. The Trustor will remain liable for any deficiency owing to the Beneficiary after application of the net proceeds of any foreclosure sale. Upon the completion of any foreclosure or trustee’s sale of all or a portion of the Collateral, Beneficiary may commence an action to recover any of the Obligations that remain unpaid or unsatisfied. For purposes of this Deed of Trust, the Obligations shall be deemed to be paid or satisfied only to the extent that Beneficiary actually receives immediately available funds, to the extent of any credit bid by Beneficiary at any foreclosure or trustee’s sale of any of the Collateral, or to the extent agreed in writing by Beneficiary. In any action by Beneficiary to recover a deficiency judgment following a foreclosure or trustee’s sale, the successful bid amount at that sale shall be deemed conclusively to be the fair market value of the Collateral sold at that sale, which value shall be binding against Trustor in any proceeding to determine or establish the fair market value of that portion of the Collateral. The successful bid at any foreclosure or trustee’s sale shall be the preferred alternative means of determining and establishing the fair market value of the portion of the Collateral sold at that sale. Trustor hereby waives any right to have the fair market value of the Collateral determined by a judge or jury in any action seeking a deficiency judgment, including without limitation, a hearing to determine fair market value pursuant to A.R.S. §§ 12-1566, 33-814, 33-725, or 33-727.

Section 8.7 Reserved.

Section 8.8 Trustor’s Waiver of Appraisement, Marshaling, Etc. The Trustor agrees that the Trustor will not at any time insist upon or plead or in any manner whatsoever claim the benefit of any appraisement, valuation, stay, extension or redemption law now or hereafter in force, in order to prevent or hinder the enforcement or foreclosure of this instrument, the absolute sale of the Collateral or the possession thereof by any purchaser at any sale made pursuant to this instrument or pursuant to the decree of any court of competent jurisdiction. The Trustor, for the Trustor and all who may claim through or under the Trustor, hereby waives the benefit of all such laws and to the extent that the Trustor may lawfully do so under applicable state law, waives any and all right to have the Collateral marshaled upon any foreclosure of the lien hereof or sold in inverse order of alienation and, the Trustor agrees that the Trustor may sell the Collateral as an entirety. Trustor hereby waives all rights and remedies that Trustor may have or be able to assert by reason of the laws of the State of Arizona pertaining to the rights and remedies of sureties including, without limitation, A.R.S. § 12-1641 through 12-1646, and Arizona Rules of Civil Procedure 17(f).

ARTICLE 9 – MISCELLANEOUS

Section 9.1 Recording and Filing. The Trustor shall pay all costs of filing, registering and recording this and every other instrument in addition or supplemental hereto and all financing statements the Beneficiary may require, in such offices and places and at such times and as often as may be, in the judgment of the Beneficiary, necessary to preserve, protect and renew the lien and security interest herein created as a first lien and prior security interest on and in the Collateral and otherwise do and perform all matters or things necessary or expedient to be done or observed by reason of any law or regulation of any State or of the United States or of any other competent authority for the purpose of effectively creating, maintaining and preserving the lien and security interest created herein and on the Collateral and the priority thereof. The Trustor shall also pay the costs of obtaining reports from appropriate filing officers concerning financing statement filings in respect of any of the Collateral in which a security interest is granted herein.

Section 9.2 Trustee’s and Beneficiary’s Right to Perform Trustor’s Obligations. The Trustor agrees that, if Trustor fails to perform any act which Trustor is required to perform under this instrument, the Beneficiary or the Trustee or any receiver appointed hereunder may, but shall not be obligated to, perform or cause to be performed such act, and any expense incurred by the Beneficiary or the Trustee in so doing shall be a demand obligation owing by the Trustor to the Beneficiary, shall bear interest at an annual rate equal to the maximum interest rate provided in the Loan Agreement until paid and shall be a part of the Obligations, and the Beneficiary, the Trustee or any receiver shall be subrogated to all of the rights of the party receiving the benefit of such performance. The undertaking of such performance by the Beneficiary, the Trustee or any receiver as aforesaid shall not obligate such person to continue such performance or to engage in such performance or performance of any other act in the future, shall not relieve the Trustor from the observance or performance of any covenant, warranty or agreement contained in this instrument or constitute a waiver of default hereunder and shall not affect the right of the Beneficiary to accelerate the payment of all indebtedness and other sums secured hereby or to resort to any other of its rights or remedies hereunder or under applicable law. In the event the Beneficiary, the Trustee or any receiver appointed hereunder undertakes any such action, no such party shall have any liability to the Trustor in the absence of a showing of gross negligence or willful misconduct of such party, and in all events no party other than the acting party shall be liable to Trustor.

Section 9.3 Discharge of Purchaser. Upon any sale made under the powers of sale herein granted and conferred, the receipt of Beneficiary will be sufficient discharge to the purchaser or purchasers at any sale for the purchase money, and such purchaser or purchasers and the heirs, devisees, personal representatives, successors and assigns thereof will not, after paying such purchase money and receiving such receipt of Beneficiary, be obliged to see to the application thereof or be in anywise answerable for any loss, misapplication or nonapplication thereof.

Section 9.4 Indebtedness of Obligations Absolute. Nothing herein contained shall be construed as limiting the Beneficiary to the collection of any indebtedness of the Trustor to the Beneficiary only out of the income, revenue, rents, issues and profits from the Collateral or as obligating the Beneficiary to delay or withhold action upon any default which may be occasioned by failure of such income or revenue to be sufficient to retire the principal or interest when due on the indebtedness secured hereby. It is expressly understood between the Beneficiary and the Trustor that any indebtedness of the Trustor to the Beneficiary secured hereby shall constitute an absolute, unconditional obligation of the Trustor to pay as provided herein or therein in accordance with the terms of the instrument evidencing such indebtedness in the amount therein specified at the maturity date or at the respective maturity dates of the installments thereof, whether by acceleration or otherwise.

Section 9.5 Defense of Claims. The Trustee will promptly notify the Trustor and the Beneficiary in writing of the commencement of any legal proceedings affecting Beneficiary’s or Trustee’s interest in the Collateral, or any part thereof, and shall take such action, employing attorneys acceptable to the Beneficiary (acting reasonably), as may be necessary to preserve the Trustor’s, the Trustee’s and the Beneficiary’s rights affected thereby; and should the Trustor fail or refuse to take any such action, the Trustee or the Beneficiary may take the action on behalf of and in the name of the Trustor and at the Trustor’s expense. Moreover, the Beneficiary or the Trustee on behalf of Beneficiary may take independent action in connection therewith as they may in their discretion deem proper, and the Trustor hereby agrees to make reimbursement for all sums advanced and all expenses incurred in such actions plus interest at a rate equal to the maximum interest rate provided in the Loan Agreement.

Section 9.6 Termination. If all the Obligations are irrevocably and finally paid in full, the covenants herein contained are well and truly performed, and the Credit Documents are all terminated and no longer in effect, and if the Trustor and the Beneficiary intend at such time that this instrument not secure any obligation of the Trustor thereafter arising, then the Beneficiary shall, upon the request of the Trustor and at the Trustor’s cost and expense, deliver to Trustor proper instruments executed by the Beneficiary evidencing the release of this instrument. Until such delivery, this instrument shall remain and continue in full force and effect. All indemnifications provided by the Trustor for the benefit of the Trustee and/or the Beneficiary shall survive any release or termination of this Deed of Trust and shall remain in full force and effect.

Section 9.7 Renewals, Amendments and Other Security. Renewals, restatements, replacements and extensions of the Obligations may be given at any time, amendments may be made to the agreements with third parties relating to any part of the Obligations or the Collateral, and the Beneficiary or the Trustee may take or hold other security for the Obligations without notice to or consent of the Trustor. The Trustee or the Beneficiary may resort first to other security or any part thereof, or first to the security herein given or any part thereof, or from time to time to either or both, even to the partial or complete abandonment of either security, and such action will not be a waiver of any rights conferred by this instrument.

Section 9.8 Successor Trustees. The Trustee may resign in writing addressed to Beneficiary or be removed at any time with or without cause by an instrument in writing duly executed by Beneficiary. In case of the resignation or removal of the Trustee, a successor Trustee may be appointed by Beneficiary by instrument of substitution complying with any applicable requirements of law, and in the absence of any such requirement, without other formality than an appointment and designation in writing. Any appointment and designation will be full evidence of the right and authority to make the same and of all facts therein recited. Upon the making of any appointment and designation, all the estate and title of the Trustee in all of the Collateral will vest in the named successor Trustee, and the successor will thereupon succeed to all the rights, powers, privileges, immunities and duties hereby conferred upon the Trustee. All references herein to the Trustee will be deemed to refer to the Trustee from time to time acting hereunder.

Section 9.9 Limitations on Interest. No provision of the Loan Agreement, the other Credit Documents, or other instrument constituting or evidencing any of the Obligations or any other agreement between the parties shall require the payment or permit the collection of interest in excess of the maximum non-usurious rate which Trustor may agree to pay under applicable laws. The intention of the parties being to conform strictly to applicable usury laws now in force, the interest on the principal amount of the Loan Agreement and the interest on other amounts due under and/or secured by this instrument shall be held to be subject to reduction to the amount allowed under said applicable usury laws as now or hereafter construed by the courts having jurisdiction, and any excess interest paid shall be credited to Trustor.

Section 9.10 Effect of Instrument. This instrument shall be deemed and construed to be, and may be enforced as, an assignment, chattel mortgage or security agreement, common law pledge, contract, deed of trust, fixture filing, financing statement, real estate mortgage, and as any one or more of them if appropriate under the UCC or other applicable state law. This instrument shall be effective as a fixture filing with respect to the Trustor as the debtor. This instrument shall be effective as a financing statement covering minerals, As-Extracted Collateral or the like and accounts subject to the UCC as enacted in the appropriate jurisdiction and is to be filed for record in the Office of the County Clerk or other appropriate office of each county where any part of the Collateral is situated. A carbon, photographic, or other reproduction of this Deed of Trust or of any financing statement relating to this Deed of Trust shall be sufficient as a financing statement.

Section 9.11 Unenforceable or Inapplicable Provisions. If any provision hereof or of any of the written instruments constituting part or all of the Obligations is invalid or unenforceable in any jurisdiction, whether with respect to all parties hereto or with respect to less than all of such parties, the other provisions hereof and of the written instruments will remain in full force and effect in that jurisdiction with respect to the parties as to which such provision is valid and enforceable, and the remaining provisions hereof will be liberally construed in favor of Beneficiary in order to carry out the provisions hereof. The invalidity of any provision of this instrument in any jurisdiction will not affect the validity or enforceability of any provision in any other jurisdiction.

Section 9.12 Rights Cumulative. Each and every right, power and remedy given to Beneficiary herein or in any other written instrument relating to the Obligations will be cumulative and not exclusive; and each and every right, power and remedy whether specifically given herein or otherwise existing may be exercised from time to time and as often and in such order as may be deemed expedient by Beneficiary, and the exercise, or the beginning of the exercise, of any such right, power or remedy will not be deemed a waiver of the right to exercise, at the same time or thereafter, any other right, power or remedy. A waiver by Beneficiary of any right or remedy hereunder or under applicable law on any occasion will not be a bar to the exercise of any right or remedy on any subsequent occasion.

Section 9.13 Waiver. Without limiting any other waivers set forth herein, and in addition to such waivers, Trustor waives and agrees not to assert: (i) any right to require Beneficiary to proceed against Borrower or any guarantor of the Obligations, to proceed against or exhaust any security for the Obligations, to pursue any other remedy available to Beneficiary, or to pursue any remedy in any particular order or manner; (ii) demand, diligence, presentment for payment, protest, and demand, and notice of extension, dishonor, protest, demand, nonpayment and acceptance with respect to any Obligations or documents or instruments evidencing the same; (iii) notice of the existence, creation or incurring of new or additional obligations of Borrower to Beneficiary; (iv) the benefits of any statutory provision limiting the liability of a surety, including without limitation the provisions of A.R.S. § 12-1641 et seq. and Rule 17(f) of the Arizona Rules of Civil Procedure; (v) any defense arising by reason of any impairment of any security of the Obligations, any impairment of Trustor’s subrogation rights or other rights against Borrower or any guarantor; and (vi) any defense arising by reason of any disability or other defense of Borrower by reason of the cessation from any cause whatsoever (other than payment in full) of the liability of Borrower for the Obligations. Until payment in full of the Obligations, Trustor shall have no right of subrogation and hereby waives any right to enforce any remedy which Beneficiary now has, or may hereafter have, against Borrower and waves any benefit of, and any right to participate in, any security now or hereafter held by Beneficiary.

Section 9.14 Non-Waiver. No act, delay, omission or course of dealing between Beneficiary and Trustor will be a waiver of any of Beneficiary’s rights or remedies hereunder or under applicable law. No waiver, change or modification in whole or in part of this instrument or any other written instrument will be effective unless in a writing signed by Beneficiary.

Section 9.15 Beneficiary’s Expenses. The Trustor agrees to pay in full all expenses and reasonable attorneys’ fees of the Beneficiary or the Trustee which may have been or may be incurred by the Beneficiary or the Trustee in connection with the collection of the Obligations and the enforcement of any of Trustor’s obligations hereunder and under any documents executed in connection with the Obligations.

Section 9.16 Indemnification. In addition to any other indemnifications or similar obligations contained in this instrument or elsewhere, the Trustor hereby indemnifies and saves and holds harmless the Beneficiary, the Trustee, their respective successors and assigns, their respective Affiliates and their respective directors, partners, managers, principals, officers, employees, agents, consultants and representatives (each, an “Indemnified Party) from, and no such Indemnified Party shall be liable for, any and all liabilities, obligations, losses, damages, penalties, actions, judgments, fines, suits, costs, charges, claims, taxes, fees, expenses, payments or disbursements of any kind whatsoever, including attorneys’ fees and expenses (collectively “Losses”) which may at any time (including, without limitation, at any time following the payment of the Obligations) be imposed on, incurred or suffered by or asserted against any Indemnified Party in any way relating to or arising out of this Deed of Trust or any other Credit Document or any instrument contemplated by or referred to herein or therein (including exercise by the Beneficiary or the Trustee of any right, power or remedy conferred upon it by this instrument or any other instrument pertaining hereto, or from the attempt or failure of the Beneficiary or the Trustee to exercise any such right, power or remedy), or the transactions contemplated hereby or thereby, or any act or omission of the Trustor, or the ownership, management, administration, operation, use or condition of the Lands, the other Collateral or the Black Canyon Mica Operation or any other property, except with respect to Losses arising entirely out of the gross negligence or willful misconduct of such Indemnified Party. Notwithstanding any provision hereof to the contrary, the foregoing indemnity shall in all respects survive, continue and remain in full force and effect even though all Obligations, indebtedness and other sums secured hereby may be fully paid and the lien of this instrument released.

Section 9.17 Partial Releases. In the event the Trustor sells for monetary consideration or otherwise any portion of the Collateral, in compliance with and as permitted by the Loan Agreement, the Beneficiary and the Trustee shall release the lien of this instrument with respect to the portion sold, at the reasonable request of the Trustor, at the Trustor’s cost and expense. No release from the lien of this instrument of any part of the Collateral by Beneficiary shall in anywise alter, vary or diminish the force, effect or lien of this instrument on the balance or remainder of the Collateral.

Section 9.18 Subrogation. This instrument is made with full substitution and subrogation of Beneficiary and Trustee in and to all covenants and warranties by others heretofore given or made in respect of the Collateral or any part thereof.

Section 9.19 Notice. All notices and deliveries of information hereunder shall be deemed to have been duly given if actually delivered or mailed by registered or certified mail, postage prepaid, addressed to the parties hereto at the addresses set forth above on page 1; if by mail, then as of the date of such mailing. Each party may, by written notice so delivered to the others, change the address to which delivery shall thereafter be made.

Section 9.20 Successors. This instrument shall bind and inure to the benefit of the respective successors and assigns of the parties.

Section 9.21 Interpretation.

(a) Article and section headings used in this instrument are intended for convenience only and shall be given no significance whatever in interpreting and construing the provisions of this instrument.

(b) As used in this instrument, “Beneficiary” and “Trustee” include their respective successors and assigns. Unless context otherwise requires, words in the singular number include the plural and in the plural number include the singular. Words of the masculine gender include the feminine and neuter gender and words of the neuter gender may refer to any gender.

Section 9.22 Counterparts. This instrument may be executed in any number of counterparts, each of which will for all purposes be deemed to be an original, and all of which are identical except that to facilitate recordation, in particular counterparts hereof, portions of Exhibit A hereto which describe properties situated in counties other than the county in which the counterpart is to be recorded have been omitted.

Section 9.23 Survival of Representations and Warranties. All representations and warranties made hereunder and in any document, certificate or statement delivered pursuant hereto or in connection herewith shall survive the execution and delivery of this Deed of Trust and the advance of any amounts in connection with the Loan Agreement.

Section 9.24 Rights Absolute. All rights of the Trustee and the Beneficiary and the deed of trust, pledge, assignment, charge and security interest hereunder, and all obligations of the Trustor hereunder, shall be absolute and unconditional, irrespective of:any lack of validity or enforceability of any Credit Document or any other agreement or instrument relating thereto;any change in the time, manner or place of payment of, or in any other term of, all or any of the Obligations, or any other amendment or waiver of or any consent to any departure from any Credit Document, including, without limitation, any increase in the Obligations;any taking, exchange, release or non-perfection of any other collateral, or any taking, release, amendment or waiver of or consent to departure from any guaranty, surety or support agreement for all or any of the Obligations;any manner of application of collateral or proceeds thereof, to all or any of the Obligations, or any manner of sale or other disposition of any collateral for all or any of the Obligations or any other assets of any principal, guarantor or surety;any change, restructuring or termination of the corporate or company structure or existence of the Borrower, the Trustor or any affiliate thereof; andany other circumstance that might otherwise constitute a defense available to, or a discharge of, the Trustor or any affiliate of the Trustor, any other Person liable for the Obligations or a third party guarantor or grantor of a security interest.

Section 9.25 Joint and Several Liability. Trustor, Borrower and the other guarantors are engaged in related businesses and are integrated to such an extent that the financial strength and flexibility of each such party has a direct, tangible and immediate impact on the success of the other parties. Trustor will derive substantial and immediate direct and indirect benefit from the Loan Agreement, the Credit Documents, the Gold and Silver Supply Agreement and the transactions entered into in connection therewith. Trustor expressly waives any right to revoke, terminate or suspend this Agreement and acknowledges that it entered into such Agreement in contemplation of the benefits that it would receive by the Loan Agreement, the Gold and Silver Supply Agreement and the other Credit Documents.

Section 9.26 Entire Agreement; Exhibits. The Exhibits to this Deed of Trust form an integral part of this Deed of Trust and are incorporated herein by reference and expressly made a part hereof. This Deed of Trust constitutes the entire agreement among the parties with respect to the subject matter hereof, superseding all prior statements, representations, discussions, agreements and understandings, oral or written, relating to such subject matter, including all term sheets and commitment letters.

Section 9.27 Governing Law. THIS DEED OF TRUST SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF ARIZONA, WITHOUT GIVING EFFECT TO CONFLICT OF LAWS PRINCIPLES. THE COURTS OF ARIZONA, FEDERAL OR STATE, SHALL HAVE EXCLUSIVE JURISDICTION OF ALL LEGAL ACTIONS ARISING OUT OF THIS DEED OF TRUST. BY EXECUTING THIS DEED OF TRUST, THE UNDERSIGNED SUBMITS TO THE JURISDICTION OF THE FEDERAL AND STATE COURTS OF ARIZONA.

[Signature Page to Follow]

EXHIBIT A

AZCO Mica, Inc.				Xxxxxxx Claims
Black Canyon Mica Project				Yavapai County, Arizona
AMC	NAME	COUNTY	LOCATION	COUNTY	BLM	SEC/
NO.		BOOK/PAGE	DATE	RECORDING	REC.	TOWNSHIP/
				DATE	DATE	RANGE
351306	Xxxxxxx #1	3642/411	2/16/99	2/26/99	2/25/99	18/8N/2E
351307	Xxxxxxx #2	3642/412	2/17/99	2/26/99	2/25/99	18/8N/2E
351308	Xxxxxxx #3	3642/413	2/16/99	2/26/99	2/25/99	13/8N/1E &18/8N/2E
351309	Xxxxxxx #4	3642/414	2/17/99	2/26/99	2/25/99	13/8N/1E &18/8N/2E
351310	Xxxxxxx #5	3642/415	2/17/99	2/26/99	2/25/99	18/8N/2E
351311	Xxxxxxx #6	3642/416	2/16/99	2/26/99	2/25/99	7&18/8N/2E
351312	Xxxxxxx #7	3642/417	2/16/99	2/26/99	2/25/99	12/8N/1E & 7&18/8N/2E
351313	Xxxxxxx #8	3642/418	2/16/99	2/26/99	2/25/99	13/8N/1E &18/8N/2E
351314	Xxxxxxx #9	3642/419	2/17/99	2/26/99	2/25/99	13/8N/1E
351315	Xxxxxxx #10	3642/420	2/16/99	2/26/99	2/25/99	12/8N/1E
351316	Xxxxxxx #11	3642/421	2/18/99	2/26/99	2/25/99	12/8N/1E
351317	Xxxxxxx #12	3642/422	2/18/99	2/26/99	2/25/99	12/8N/1E & 7/8N/2E
351318	Xxxxxxx #13	3642/423	2/18/99	2/26/99	2/25/99	7/8N/2E
351319	Xxxxxxx #14	3642/424	2/18/99	2/26/99	2/25/99	7/8N/2E
351320	Xxxxxxx #15	3642/425	2/16/99	2/26/99	2/25/99	7&18/8N/2E
351321	Xxxxxxx #16	3642/426	2/16/99	2/26/99	2/25/99	18/8N/2E
351322	Xxxxxxx #17	3642/427	2/17/99	2/26/99	2/25/99	18/8N/2E
351323	Xxxxxxx #18	3642/428	2/19/99	2/26/99	2/25/99	7/8N/2E
351324	Xxxxxxx #19	3642/429	2/19/99	2/26/99	2/25/99	12/8N/1E & 7/8N/2E
351325	Xxxxxxx #20	3642/430	2/19/99	2/26/99	2/25/99	12/8N/1E
351326	Xxxxxxx #21	3642/431	2/19/99	2/26/99	2/25/99	7/8N/2E
351327	Xxxxxxx #22	3642/432	2/19/99	2/26/99	2/25/99	7/8N/2E
351328	Xxxxxxx #23	3642/433	2/19/99	2/26/99	2/25/99	7/8N/2E
351329	Xxxxxxx #24	3642/434	2/18/99	2/26/99	2/25/99	7/8N/2E
351330	Xxxxxxx #25	3642/435	2/18/99	2/26/99	2/25/99	7/8N/2E
351331	Xxxxxxx #26	3642/436	2/18/99	2/26/99	2/25/99	7/8N/2E
351332	Xxxxxxx #27	3642/437	2/18/99	2/26/99	2/25/99	7/8N/2E
351333	Xxxxxxx #28	3642/438	2/19/99	2/26/99	2/25/99	7/8N/2E
351334	Xxxxxxx #29	3642/439	2/19/99	2/26/99	2/25/99	7/8N/2E
351335	Xxxxxxx #30	3642/440	2/16/99	2/26/99	2/25/99	7&18/8N/2E
351336	Xxxxxxx #31	3642/441	2/16/99	2/26/99	2/25/99	7&18/8N/2E
351337	Xxxxxxx #32	3642/442	2/16/99	2/26/99	2/25/99	18/8N/2E
351338	Xxxxxxx #33	3642/443	2/16/99	2/26/99	2/25/99	18/8N/2E
351339	Xxxxxxx #34	3642/444	2/17/99	2/26/99	2/25/99	18/8N/2E
351340	Xxxxxxx #35	3642/445	2/17/99	2/26/99	2/25/99	13/8N/1E
351341	Xxxxxxx #36	3642/446	2/17/99	2/26/99	2/25/99	13/8N/1E & 18/8N/2E
351342	Xxxxxxx #37	3642/447	2/17/99	2/26/99	2/25/99	18/8N/2E
351343	Xxxxxxx #38	3642/448	2/17/99	2/26/99	2/25/99	18/8N/2E
351344	Xxxxxxx #39	3642/449	2/17/99	2/26/99	2/25/99	18/8N/2E
351345	Xxxxxxx #40	3642/450	2/17/99	2/26/99	2/25/99	18/8N/2E

Exhibit A Page 1 of 2

351346	Xxxxxxx #41	3642/451	2/19/99	2/26/99	2/25/99	6&7/8N/2E

	AZCO Mica, Inc.					Xxxxxxx Claims
	Blk Canyon Proj					Yavapai Co., AZ

351347	Xxxxxxx #42	3642/452	2/19/99	2/26/99	2/25/99	6&7/8N/2E
351348	Xxxxxxx #43	3642/453	2/19/99	2/26/99	2/25/99	6&7/8N/2E
351382	Xxxxxxx #77	3642/487	1/11/99	2/26/99	2/25/99	6&7/8N/2E
351384	Xxxxxxx #79	3642/489	1/11/99	2/26/99	2/25/99	6&7/8N/2E
351427	Xxxxxxx #122	3642/532	1/7/99	2/26/99	2/25/99	12-8N-1E
351428	Xxxxxxx #123	3642/533	12/15/98	2/26/99	2/25/99	13-8N-1E
351429	Xxxxxxx #124	3642/534	1/7/99	2/26/99	2/25/99	12-8N-1E
351430	Xxxxxxx #125	3642/535	12/15/98	2/26/99	2/25/99	13-8N-1E
351431	Xxxxxxx #126	3642/536	1/7/99	2/26/99	2/25/99	12-8N-1E
351432	Xxxxxxx #127	3642/537	12/15/98	2/26/99	2/25/99	13-8N-1E
351451	Xxxxxxx #146	3642/556	12/15/98	2/26/99	2/25/99	13-8N-1E
351452	Xxxxxxx #147	3642/557	12/18/98	2/26/99	2/25/99	13-8N-1E
351453	Xxxxxxx #148	3642/558	12/15/98	2/26/99	2/25/99	13-8N-1E
351454	Xxxxxxx #149	3642/559	12/18/98	2/26/99	2/25/99	13-8N-1E
351455	Xxxxxxx #150	3642/560	12/15/98	2/26/99	2/25/99	12-8N-1E
351456	Xxxxxxx #151	3642/561	12/18/98	2/26/99	2/25/99	13-8N-1E
351457	Xxxxxxx #152	3642/562	12/15/98	2/26/99	2/25/99	13-8N-1E
351458	Xxxxxxx #153	3642/563	12/18/98	2/26/99	2/25/99	13-8N-1E
351460	Xxxxxxx #155	3642/565	12/18/98	2/26/99	2/25/99	13-8N-1E
351462	Xxxxxxx #157	3642/567	12/18/98	2/26/99	2/25/99	13-8N-1E
351489	Xxxxxxx #184	3642/594	12/18/98	2/26/99	2/25/99	13&24-8N-1E
351491	Xxxxxxx #186	3642/596	12/18/98	2/26/99	2/25/99	13&24-8N-1E
351492	Xxxxxxx #187	3642/597	1/6/99	2/26/99	2/25/99	24-8N-1E
351493	Xxxxxxx #188	3642/598	12/18/98	2/26/99	2/25/99	13 & 24-8N-1E
351494	Xxxxxxx #189	3642/599	1/6/99	2/26/99	2/25/99	23 & 24-8N-1E
351495	Xxxxxxx #190	3642/600	12/18/98	2/26/99	2/25/99	13,14,23 & 24-8N- 1E

AZCO Mica, Inc.				Mica Millsite Claims
Black Canyon Mica Project				Maricopa County, Arizona

AMC	NAME	COUNTY	LOCATION	COUNTY	BLM	SEC/
NO.		BOOK/PAGE	DATE	RECORDING	REC.	TOWNSHIP/
				DATE	DATE	RANGE
352501	Mica 12 Millsite	00-0000000	9/8/99	9/20/99	9/17/99	28-T8N-42E
352503	Mica 14 Millsite	00-0000000	9/8/99	9/20/99	9/17/99	28-T8N-42E
352505	Mica 16 Millsite	00-0000000	9/8/99	9/20/99	9/17/99	28-T8N-42E
352508	Mica 19 Millsite	00-0000000	9/8/99	9/20/99	9/17/99	28-T8N-42E
352509	Mica 20 Millsite	00-0000000	9/8/99	9/20/99	9/17/99	27-T8N-42E
352510	Mica 21 Millsite	00-0000000	9/8/99	9/20/99	9/17/99	28-T8N-42E
352511	Mica 22 Millsite	00-0000000	9/8/99	9/20/99	9/17/99	27-T8N-42E
352512	Mica 23 Millsite	00-0000000	9/8/99	9/20/99	9/17/99	28-T8N-42E
352513	Mica 24 Millsite	00-0000000	9/8/99	9/20/99	9/17/99	27-T8N-42E

Exhibit A Page 2 of 2

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DEED OF TRUST, SECURITY AGREEMENT, ASSIGNMENT OF PRODUCTION, RENTS AND LEASEHOLD INTERESTS, FIXTURE FILING, AND FINANCING STATEMENT FROM AZCO MICA, INC., as Trustor TO FIRST AMERICAN TITLE INSURANCE COMPANY, as Trustee AND WATERTON GLOBAL VALUE, L.P.,...

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