Common use of Reclamation Trust Clause in Contracts

Reclamation Trust. The Grantor and the Royalty Owner covenant that if changes are made to the Tax Act so as to permit the formation of a vehicle which: (a) has characteristics similar to those of a mining reclamation trust, as defined in the Tax Act; (b) may be used to secure or otherwise provide funding for any well bore, facility abandonment, environmental or reclamation obligations and liabilities in respect of the Properties for which the Grantor may be liable; and (c) would have beneficial income tax consequences for the Grantor, as determined by the Grantor acting reasonably; then: (d) the Grantor may cause such a vehicle to be formed and shall control such vehicle; (e) the amount contained in the Reclamation Fund at the time of the formation of such vehicle shall immediately be paid into such vehicle; (f) after the formation of such vehicle, any amounts which would have been paid into the Reclamation Fund pursuant to this Article 4 shall be paid directly into such vehicle; and (g) after the formation of such vehicle, for the purpose of computing the Royalty, payments to or from such vehicle shall be deemed to be payments to or from the Reserve.