Common use of ROYALTY INTEREST Clause in Contracts

ROYALTY INTEREST. The Optionor shall be entitled to receive and the Optionee shall pay to the Optionor a royalty equal to 2% of the net smelter returns (the "Royalty Interest") calculated and payable from the Property in accordance with the provisions of Schedule "B" attached hereto. The Optionee may at any time purchase the Royalty Interest from the Optionor for $2,000,000 or in increments of 0.5% of the Royalty Interest for the sum of $500,000 per each 0.5% increment. The Optionee agrees to pay to the Optionor Advance Royalty payments in the amount of $15,000 commencing on the date which is 60 months from the date of signing this Agreement and payable each year thereafter on the anniversary date of signing this Agreement. Such Advance Royalty payments will continue until such time as the Optionee has commenced commercial production on the Property, at which time the Advance Royalty payments will cease. Any Advance Royalty payments shall be deducted from any Royalty payments or buy-out contemplated by this section should commercial production commence. If the Optionee exercises its Option and subsequently allows the claims comprising the Property to lapse, the Optionee will be under no further obligation to make any Advance Royalty payments.

ROYALTY INTEREST. The Optionor shall be entitled to receive and the Optionee shall pay to the Optionor a royalty equal to 23% of the net smelter returns (the "Royalty Interest") calculated and payable from the Property in accordance with the provisions of Schedule "B" attached hereto. The Optionee may at any time purchase two-thirds of the Royalty Interest from the Optionor for $2,000,000 or in increments of 0.51,500,000, thereby leaving the Optionor with a 1% of the Royalty Interest for the sum of $500,000 per each 0.5% incrementInterest. The Optionee agrees to pay to the Optionor Advance Royalty payments in the amount of $15,000 commencing on the date which is 60 months from the date of signing this Agreement and payable each year thereafter on the anniversary date of signing this Agreement. Such Advance Royalty payments will continue until such time as the Optionee has commenced commercial production on the Property, at which time the Advance Royalty payments will cease. Any Advance Royalty payments shall be deducted from any Royalty payments or buy-out contemplated by this section should commercial production commence. If the Optionee exercises its Option and subsequently allows the claims comprising the Property to lapse, the Optionee will be under no further obligation to make any Advance Royalty payments.