Yukon Zinc Corporation

Re: Confidentiality and Non-Disclosure Agreement

Dear

You have requested that Yukon Zinc Corporation (the “Company”) provide you with certain Confidential Information (as hereinafter defined) for financial and technical analysis and due diligence relating to the Company and its business affairs in connection with your service (the “Transaction”).  In consideration of the Company providing you with this Confidential Information, you undertake and agree as follows (the “Agreement”):

1.                  You acknowledge that you will be receiving information, furnished to you by the Company or its agents or any of them as the Company in its sole discretion deems appropriate from time to time (including without limitation, written information as well as information transferred orally, visually, electronically or by any other means).  All such information, together with all technical reports, feasibility studies, analyses, compilations, data, memoranda, studies or other documents prepared by the Company or its agents or by you or your subsidiaries, affiliates, directors, officers, employees, partners, legal advisors, or agents (any and all of the foregoing being hereinafter referred to as “Representatives”) containing, or based in whole or in part on, any such furnished information or reflecting such furnished information in the review thereof by you or your Representatives is collectively referred to herein as “Confidential Information”.

2.                  Notwithstanding paragraph 1, Confidential Information does not include any information that:

(a)                is at the time of disclosure to you, or thereafter becomes, generally available to the public, other than as a result of a disclosure by you in breach of this Agreement;

(b)               is or was received by you on a non-confidential basis from a source other than the Company if such source is not known to you to be prohibited from disclosing the information to you by a confidentiality agreement with, or a contractual, fiduciary or other legal obligation to, the Company; or

(c)                was known by you prior to disclosure under this Agreement if you are not subject to any contractual, fiduciary or other legal confidentiality obligation in respect of such information.

3.                  You agree that the Confidential Information will be kept confidential by you and your Representatives and such Confidential Information (a) will not, without the prior written consent of the Company, be disclosed to any person by you or your Representatives, in any manner whatsoever, in whole or in part, and (b) will not be used, directly or indirectly, for any purpose other than evaluating your participation in the Transaction (the “Permitted Purposes”).  You expressly agree that in no event and at no time, will you disclose or use any of the Confidential Information in furtherance of your business or the business of anyone else.

4.                  You agree and acknowledge that all Confidential Information contemplated by this Agreement is and will remain, notwithstanding its disclosure to you or your Representatives, the sole and exclusive property of the Company.

5.                  You will reveal the Confidential Information only to such of your Representatives who (i) need to know the Confidential Information for the Permitted Purposes, (ii) are informed of the confidential nature of the Confidential Information, and (iii) agree to be bound by the terms and conditions of this Agreement.  You will be jointly and severally responsible for any breach of this Agreement by any of your Representatives.

6.                  You acknowledge that, from time to time, the Company may determine, acting reasonably and in good faith:

(a)                that the provision of certain Confidential Information to you or certain of your Representatives is inappropriate; or

(b)               to provide certain Confidential Information to you in a manner designed to limit the access of certain of your Representatives to such material;

and you agree to comply with such restrictions.

7.                  Except as otherwise expressly permitted by this Agreement, neither you nor your Representatives will disclose to any other person that the Confidential Information has been made available to it, that discussions or negotiations are taking place concerning a potential transaction, or any of the terms, conditions or other facts with respect to any such transaction, including the existence and status of this Agreement. 

8.                  You will keep control of the Confidential Information furnished to you.  If requested by the Company, you will promptly destroy or return the Confidential Information and all copies, provided that with respect to digital copies of such Confidential Information (i) you will destroy digital copies to the extent reasonably possible in the circumstances, and (ii) you will be deemed to have destroyed any Confidential Information in electronic form if such information is deleted from local hard drives so long as no attempt is made to recover such information from servers or back-up sources.  You will on request certify to the Company in writing the fact of the return or destruction of all Confidential Information as provided in this Agreement.

9.                  You acknowledge that you are aware, and will inform your Representatives who are informed as to the matters which are the subject of this Agreement, that the Confidential Information may constitute material non-public information regarding the Company and its securities and you agree to comply with applicable United States and Canadian securities laws governing the disclosure and use of material non-public information of publicly-traded companies, including those rules governing buying and selling securities based on insider information, if the Company’s securities become publicly traded in the future.

10.              You acknowledge that neither the Company nor any of its Representatives makes nor shall be deemed to make any representation or warranty as to the accuracy or completeness of any of the Confidential Information and shall have no liability as a result of the use of or reliance on such Confidential Information or any errors therein or omissions therefrom.

11.              Notwithstanding any provision in this Agreement, you may disclose Confidential Information pursuant to a requirement of a governmental department, administration, agency or commission if disclosure is required by the operation of law, rule or regulation, provided, in each case, that you give notice to the Company of the required disclosure immediately upon becoming advised of such required disclosure and provided also that you delay such disclosure, in a manner not inconsistent with the applicable law, rule or regulation, so long as it is reasonably practicable in order to permit the Company to take appeal or otherwise oppose such required disclosure.  You agree to take all such reasonably necessary action as the Company may direct to assist the Company in such appeal or opposition, or, in the event the Company is not legally entitled to make any such appeal, to commence such an appeal yourself.

12.              You agree that all covenants contained in this Agreement on your part to be complied with are reasonable and valid and you waive all defences to the strict enforcement thereof by the Company.  No modification or waiver of any of the provisions of this Agreement is effective unless in writing and signed by the Company.  No failure or delay by the Company in exercising any right, power or privilege hereunder will operate as a waiver thereof, nor will any signed or partial exercise of any such right, power or privilege.

13.              It is understood that a breach of any of the covenants or provisions contained herein would cause the Company to suffer loss which could not be adequately compensated for by damages and that the Company may, in addition to any other remedy for relief, enforce the performance of this Agreement by injunction or specific performance upon application to a court of competent jurisdiction.

14.              You agree to indemnify and hold harmless the Company and its Representatives from and against all claims, liabilities, damages, losses, costs and expenses arising or resulting, directly or indirectly, from any breach of this Agreement by you or any of your Representatives.  You further agree that this right to indemnification is in addition to, and shall not derogate from, any other rights which the Company or its Representatives may have against you or your Representatives under this Agreement, at law, in equity or otherwise.

15.              If any provision of this Agreement is determined to be illegal, invalid or unenforceable in whole or in part by a court of competent jurisdiction, it shall be deemed not to affect or impair the legality or validity of the remaining provisions hereof and each paragraph and sentence of this Agreement is hereby declared to be a separate and distinct provision.

16.              You confirm that your obligation to maintain the confidentiality of the Confidential Information as contemplated hereby will survive indefinitely. 

17.              This Agreement shall be governed by the laws of the Province of British Columbia.

18.              The provisions hereof will enure to the benefit of and be binding upon the successors of the parties hereto.  This Agreement will not be assignable, in whole or in part, by you.

 

If you are in agreement with the foregoing, kindly so indicate by signing and returning the enclosed copy of this letter.

Yours truly,

                                          YUKON ZINC CORPORATION                     

By:

                                          Name:                                                                                       Title:   

Agreed and accepted this ____ day of May 2012.

 

Signature of Authorized Signatory:
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