COVENANTS

MINING LEASE

THIS IS AN AGREEMENT OF LEASE made and entered into this 13th day of July, 2005, by and between INDEPENDENCE GOLD-SILVER MINES INC., a Washington corporation, hereinafter called "Lessor" or "Independence" and GOLD RANGE COMPANY, LLC, a Nevada, USA corporation, hereinafter called “Lessee” or “Gold Range”, relating to certain unpatented mining claims situated in the Battle Mountain Mining District, Lander County, State of Nevada, owned by Independence and which are to be leased to Lessee pursuant to this agreement, hereinafter called "Lease".

I. RECITAL

Independence is the owner, subject to paramount title of the United States of America, of those certain unpatented mining claims situated in the Battle Mountain Mining District of Lander County, State of Nevada, certain of which are described in Exhibit A attached hereto and made a part hereof. All of these claims form a single mining claims group referred to hereafter as "the premises" and "the claims."

II. COVENANTS

(1) Subject to the paramount title of the United States of America, Independence does hereby exclusively lease, let and demise to Lessee all the minerals upon and underlying the said mining claims, and does hereby grant to Lessee during the time that this Lease is in effect, in consideration of the moneys to be payable as set forth in Section V, and subject to the following reservations and limitations, and other reservations and limitations in this Lease:

(a) To explore for minerals upon and within and upon the foregoing claims;

(b) To mine or otherwise extract, to mill, treat, or otherwise process, and to store, stockpile, remove, market, sell or otherwise dispose of ore and minerals which Lessee extracts from the claims;

(c) To dispose of or deposit waste material and tailings which Lessee has

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extracted from the claims;

(d) To construct, use, or maintain upon the claims buildings, shops, plants, machinery, mills, facilities, ore bins and structures of all kinds, roads, shafts, inclines, tunnels, drifts, open pits, pipelines, telephone lines, electric transmission lines, or other means of communication, transportation facilities and other utilities and facilities, the operation of road or track vehicles or aircraft and the maintenance thereof; all subject to the limitations set forth herein;

(e) To exercise any and all rights or privileges which are incidental to and which may be useful, desirable or convenient in Lessee's exercise of any or all of the rights hereinabove and hereinafter specified, which are not in conflict with applicable federal, state or local laws, rules and regulations or other provisions of this Lease.

(f) After ores, minerals or materials have been sampled and weighed or measured by volumetric survey, truck factors or any other manner as will permit the computation of the production to be paid hereunder, Lessee may mix the same with ores, minerals or materials from lands other than the premises so long as such mixing does not adversely affect the performance of Lessee's covenants under this Lease.

(g) Lessee is further granted the right to use shafts, openings or pits on the premises and structures, facilities, equipment, roadways, haulageways and all other appurtenances installed on the premises for the additional purpose of producing, removing, storing, depositing, treating or transporting ores, minerals or materials, including tailings and mine waste, from adjoining lands within which lessee has any interest so long as such mining does not adversely affect the performance of Lessee's covenants under this Lease. Lessee's operations hereunder, and its mining of adjoining lands, may be conducted upon the premises and upon such other lands as a single mining operation so long as such mining does not adversely affect the performance of Lessee's covenants under this Lease.

(h) Independence makes no representation or warranty as to the availability of

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water.

All of the rights granted to Lessee under this paragraph shall be subject to the payment of royalties as hereinafter provided in this Lease and all other limitations, reservations, terms and conditions set forth herein.

(2) Lessor represents that, to the best of its knowledge, the claims are in good standing with the United States of America and the State of Nevada and that it has the right to lease the minerals and the facilities and other property covered by this Lease. Lessor hereby represents to the best of its knowledge that it has the full right, power and capacity to enter into this Agreement on the terms and conditions herein contained. Lessor covenants that the status of the premises, as represented above, shall not be adversely affected because of any act or omission on the part of Lessor during the continuance of this Agreement.

(3) Lessor shall cooperate with Lessee in Lessee’s applications for approvals, consents, licenses and permits for Lessee’s operations on the premises.

(4) Lessor shall pay all taxes levied and assessed upon Lessor’s share of the production of minerals from the Premises, including, specifically, the net proceeds of mines taxes assessed on Lessor’s share of the production of such minerals.

(1) Any purchases or acquisitions of equipment or personal property by Lessee shall be at the sole cost and expense of the Lessee and for its own account. Upon the termination of this Lease for any cause and for 180 days thereafter, Lessee will be permitted to remove from the leased property all movable equipment and other personal property which it has installed, save and except as otherwise limited herein.

(2) Lessee shall pay in full for all labor performed upon or material furnished to the said premises at the instance or request of the Lessee. Lessee shall keep the premises free and clear from any and all liens of laborers, mechanics, materialmen, vendors or installers of fixtures and equipment, or any other person or persons who may assert a lien by law, provided, however, that

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Lessee shall have the option and right to contest any such lien by notifying Lessor of its intent to do so within ten (10) days after Lessee receives notice of the lien. Lessee shall diligently and expeditiously contest the lien. Lessee shall immediately notify Lessor when Lessee executes this Lease in order that Lessor may timely record a notice of nonresponsibility in the Office of the Recorder of Lander County, Nevada.

(3) Lessee shall at all times comply in all respects with all the laws and regulations relating to the performance of work and all other activities within or upon the leased premises. The Lessee shall provide Workmen's Compensation Insurance and such other insurance to cover personnel and all of its operations upon the premises in the amount and form as may be required by law. Lessee shall indemnify and hold the Lessor harmless of and from any and all claims, demands, or liabilities arising out of or in connection with the operations or activities of the Lessee hereunder. Lessee assumes full and sole responsibility for the operation and direction of the work done under this agreement on the leased premises and no employee or agent furnished by Lessee shall under any circumstances be deemed an employee of the Lessor.

(4) Lessee agrees to pay all taxes levied and assessed upon the leased premises or any part thereof, including taxes measured on Lessee’s share of production and also including taxes levied and assessed on improvements and any equipment, movable or immovable, placed upon the leased premises by Lessee during the continuance of this Lease, commencing with taxes for the current year, and to make payment thereof, as required by the statutes of the State of Nevada so that no default in taxes upon the leased premises shall occur, and to deliver to Lessor, upon request, the original or duplicate tax receipts for payment made. Should Lessee be in possession, under this Lease, for only a portion of a year, the tax for that year shall be pro-rated between the Lessor and the Lessee on the basis of taxes for the last preceding year. As a condition of Lessee's obligations pursuant to this paragraph, Lessor shall timely deliver to Lessee all tax notices which Lessor may receive. Lessee is not obligated to pay any taxes assessed on minimum advance production royalty or production royalty payments received by Lessor.

(5) While this Lease is in effect, Lessee does hereby agree to annually file with the appropriate agency of the United States any required "Notice of Intent to Hold Mining Claims" and to pay all required rental or other fees, including BIM rental fees due on or before the applicable statutory deadline, and to make all filings required by State of Nevada law. Furthermore, while this Lease is in effect, Lessee will perform all other duties and do all filings and recordings and make all payments required by Federal, State and local laws, rules, regulations, orders and directives. If Lessee terminates this agreement between June 1 and December 31 of any Calendar year, Lessee is obligated to pay all required rental and other fees under this section which come due between June 1 and December 31 for that Calendar year.

(6) In the event of termination of this Lease by expiration of the term hereof, or for any reason whatsoever, the Lessee agrees to surrender the leased premises to the Lessor subject to Article XXIV of this Lease. The Lessee, however, shall have the right to remove movable machinery and equipment placed by it upon and within the leased premises, save and except for track, timbers, chutes, ladders, and similar underground improvements, which shall be left in place, except to the extent Lessee is otherwise required to remove the same in accordance with applicable laws and regulations. The Lessee shall have the right to effect any permitted removal of such machinery and equipment prior to the expiration of this Lease, or within one hundred and eighty (180) days thereafter. Any such machinery or equipment not removed prior to the expiration of said period of one hundred eighty (180) days following termination of said lease shall be deemed abandoned by Lessee, affixed to the leased premises and shall become and remain the property of the Lessor. In any event, following termination, Lessee shall, if requested by Lessor, act reasonably expeditiously to remove its equipment.

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(7) Lessee agrees to keep accurate books of account showing the operations, and particularly showing ores mined and milled, or mined and shipped by the Lessee. Lessor or its authorized agents shall have a right to audit and inspect Lessee's accounts and records used in calculating production royalty payments, which right may be exercised as to each payment at any reasonable time during a period of one (1) year from the date on which the payment was made by Lessee. If no such audit is performed during such period, such accounts, records and payments shall be conclusively deemed to be true, accurate and correct.

(8) Lessee shall allow representatives of Lessor at their own risk and upon reasonable prior notice to enter upon and into all parts of said premises from time to time, and at all reasonable times and hours, for the purpose of inspecting or surveying the same, or taking samples of ore therefrom, and to examine any and all other aspects of Lessee's operations on the claims.

(9) [Deleted]

(10) Lessee shall at all times carry the following insurance coverage on the premises:

(a) Public liability insurance of not less than $1,000,000.00 (U.S.) per occurrence, nor less than $2,000,000.00 (U.S.) in aggregate, with Lessor to be a named insured.

(b) Property damage coverage of not less than $100,000.00 (U.S.), with Lessor to be a named insured.

Lessee may include this coverage with other coverage it now has or will acquire on other mining operations provided: that Lessor shall be named a loss payee and additional insured in said policy or policies, and shall within forty-five (45) days receive from Lessee or its insurer a copy of the endorsement so showing.

(11) If Lessee locates any unpatented mining claim all or part of which is within one-half (1/2) mile of any portion of the claims described in Exhibit A existing as of the effective date of this Lease, the entirety of such unpatented mining claims shall be held in the name of Lessor subject to this Lease. This section shall only govern those claims located by Gold Range, or its agents. Assignees to this agreement, shall be also bound by this section. Gold Range is under no obligation to Lessor regarding claims or mining properties acquired from any other third party.

III. WORK, EXPLORATION AND MINE

      DEVELOPMENT BY LESSEE

A. Prior to September 30, 2010, Lessee shall expend not less than Six Hundred Twenty Five Thousand Dollars ($625,000.00) per the schedule set forth below (net after any administrative, overhead or other indirect costs) towards the exploration, development and commercial production of ores, minerals or materials Minimum expenditures shall be as follows:

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Any expenditure in excess of the minimum expenditure set forth immediately above may be applied to subsequent years. To the extent that Lessee fails to expend funds pursuant to the terms of this paragraph, Lessee shall pay to Lessor, as rent, any shortfall within thirty (30) days of the end of any of the dates set forth above. In the event that Lessee terminates this Lease on or before February 1st in any of the calendar years 2008, 2009 or 2010, Lessee shall have no obligation to perform any work thereafter or to pay as rent any shortfall.

B. Upon written demand by Lessor, Lessee shall furnish a written statement of its expenditures for such exploration and mine development with a breakdown of labor, materials, equipment and other expenditures, to the extent not previously provided to Lessor. Demand by Lessor for such expenditure statement shall not exceed one (1) time in any one Calendar year.

IV. TERM OF LEASE AND CONDITIONS

The term of this Lease shall be for a period of approximately twenty (20) years, commencing October 1, 2005 and terminating at midnight on September 30, 2025, unless Lessee is then conducting exploration, development or mining operations on the premises, in which case Lessee shall have the right to extend the term of this Lease for additional terms of one (1) year so long as Lessee continues to conduct such activities.

V. ROYALTIES TO BE PAID BY LESSEE TO LESSOR

A.         Minimum Advance Royalty. The Minimum Advance Royalty shall be paid for so long as this Lease is in force and without regard to mining, production or sale of minerals on or from the claims.

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Lessee shall have no obligation to pay any Minimum Advance Royalty payments otherwise due if 1) Lessee terminates this Lease; or 2) if during the six (6) month period immediately preceding the date on which a Minimum Advance Royalty payment is otherwise due Lessee has paid to Lessor Production Royalty payments in an amount equal to or in excess of the Minimum Advance Royalty payment. All cumulative Minimum Advance Royalty payments paid by Lessee to Lessor under this Lease will be credited against any Production Royalty due Lessor under section B of this Article V and any Production Royalty due Lessor after purchase of the claims under Article XXVIII.

Subject to the foregoing paragraphs of this section, Lessee shall pay to Lessor, as Minimum Advance Royalty payments, on or before the dates shown, the sums described below:

Minimum Advance Royalty payments due from October 1, 2012 through February 1, 2018 shall be $50,000.00 increased by the greater of 25% or the percentage increase in the producer price index for the six (6) calendar years ending December 31, 2011, the base index date being December 31, 2005. Minimum advance royalty payments due from October 1, 2018 through February 1, 2025 shall be the February 1, 2018 payment, increased by the greater of 25% or the percentage increase in the producer price index for the six calendar years ending December 31, 2017, the base index being December 31, 2011.

B.          Production Royalty. So long as this Lease is in force, a Production Royalty shall be due Lessor during any period of commercial production from the claims. One hundred percent (100%) of all cumulative Minimum Advance Royalty paid by Lessee and received by Lessor can be deducted from the

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Production Royalty due Lessor.

Production Royalty shall be payable on all minerals regardless of what stage in the milling, refining, upgrading or other processing the minerals may be, which are mined from the claims ("leased substances") and sold to a buyer. Production Royalty shall be calculated and paid as follows:

(1) The Production Royalty will be calculated as a percentage of Net Smelter Returns ("NSR"). Net Smelter Returns is defined as the dollar amount actually received by Lessee from the sale of any