Fill and Sign the Arizona Mineral Lease Form

Mineral Lease to Mine Gold This document prepared by (and after recording return to): Name: _______________________________) Company: ____________________________) Address: _____________________________) City, State, Zip: ________________________) Phone: _______________________________) Above This Line Reserved For Official Use Only Mineral Lease to Mine Gold Lease Agreement made on the ________________ (date) , between ______________________ (Name of Lessor) of ______________________________ ______________________________________ (street address, city, state, zip code) , referred to herein as Lessor , and ____________________ (Name of Lessee) , of _________________________________________________ (street address, city, state, zip code) , referred to herein as Lessee . For and in consideration of the royalties to be paid, the mutual covenants contained in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows: 1. Subject Matter of Lease Lessor hereby leases to Lessee for a term to last as long as royalties are paid to Lessor by Lessee, the following land (the Premises ) situated in ________________ (name of county) , Arizona: (Legal Description of Real Property) ______________________________________________________________________ _____________________________________________________________________. Notwithstanding the foregoing and any other provision of this Lease to the contrary, Lessor reserves the right to terminate this Lease as provided in Section 17 below. 2. Purpose of Lease The Premises are leased to Lessee for the purpose of exploring for, mining, taking out, and removing the gold ore and/or other precious metals found on, in, or under the Premises together with the right to construct, make and install any buildings, machinery, excavations, openings, ditches, drains, railroads, and other improvements on the Premises as may be necessary or suitable for these purposes. 3. Security of Riparian Owners Lessee shall, at Lessee's sole cost and expense, secure riparian owners against damages from the use of this Lease by the parties to this Lease. 4. Contract with Others Lessee shall have the right to contract with others for the working of the mines, or any part of the mines, or for the use of the Premises, or any part of the Premises, for the purpose of mining, milling, and smelting gold ore and/or ores of other precious metals, with the same rights and privileges as are granted to Lessee. 5. Royalties to Lessor Royalties shall be paid by Lessee (e.g. monthly, quarterly, or annually) _____________ to Lessor of thirty-five percent (35%) of the net profits arising from the sale and disposition of the gold ore and/or ores of other precious metals from the Premises. The following shall apply to the determination of net profits and to the calculation of and payment of royalties to Lessor: A. The term net profits shall mean and include all sums received by Lessee arising from the sale and disposition of the gold ore and/or ores of other precious metals from the Premises, after deducting therefrom: (a) all costs attributable to mining, milling, and smelting gold ore and/or ores of other precious metals, and (b) the cost of ad valorem, production, severance, excise and other taxes based upon or measured by the leasing of the Premises or the production therefrom (but excluding income taxes), as and when paid by Lessor, which are attributable to such mining. B. Said net profits shall be based upon sums received by Lessee from the sale of such gold and gold products to a nonaffiliated third party in an arms' length sale. C. All payments to Lessee shall be made to Lessee at __________________ _________________________ (street address, city, state, zip code) , or such other address as Lessee notifies Lessor in writing. 6. Sale of Concentrates When concentrates obtained under this Lease are sold, the net smelter returns, less shipping charges from mine to smelter, shall be considered in computing said net profit. 7. Books of Account Lessee shall maintain accounts of all minerals mined and milled, the kind, quality, and weight, to whom sold, and the unit price received for the minerals. A correct statement and report of these accounts for each quarter year shall be furnished Lessor not later than ______ (number) days after the first day of each ___________________ __________________________ (list of months) for the preceding quarter, together with a certificate from the purchaser or smelter showing the unit price paid for the mineral purchased and the amount of gold or gold ore and concentrates purchased during the quarter from the Premises. 8. Inspection by Lessor A. Lessor shall have the right to enter on the Premises at any time, to inspect, sample and survey the Premises, and to measure the quantity of ore which shall have been mined or removed from the Premises. B. Lessor shall at all times have access to all parts of the stamp mills and other types of gold ore handling and treating plants for the purpose of sampling the ore and concentrates passing through them and of inspecting the efficiency of all scales and machinery used in weighing and treating the ore, not unreasonably hindering or interrupting the operations of Lessee. 9. Scales; Room for Use in Inspection Lessee shall install and maintain in good working order standard scales of a type approved by the State of Arizona Department of Weights & Measures, and at the request of Lessor, provide a suitable room in Lessee's office building or other suitable place with rent, water, light and heat free to agents of Lessor, for their use in the work of inspection on the Premises. Such room shall be equal in size and equipment to that furnished for the use of the mining captain or superintendent at the mine. 10. Taxes Lessee shall pay all taxes, general and specific, ordinary and extraordinary, which may be levied or assessed against the Premises, the improvements on the Premises, the products from the Premises, and any personal property on the Premises, in all respects, as if the Premises were owned in fee by Lessee. 11. Working of Mines A. Lessee will open, use and work the mines and operate its mills in such manner only as is usual and customary in skillful and proper mining and milling operations of similar character when conducted by the proprietors of their land and in accordance with the requirements of good and economical mining engineering, and in such manner as not to cause any unnecessary or unusual permanent injury to the Premises, or inconvenience or hindrance in the operations of the Premises. B. Lessee shall deposit all lean ore, earth, rock and other materials or rubbish at such places and in such manner as will not interfere with any subsequent operations. C. On the termination of this Lease, Lessee will quietly and peacefully surrender the possession of the Premises to Lessor, after safeguarding all pits and shafts by permanent coverings or fences. 12. Preparation of Mineral for Market A. All minerals shall be cleaned and/or prepared for market on the leased Premises. B. No ore or crush stock from other lands shall be brought to or cleaned or prepared for market on the leased Premises without the written consent of Lessor. Lessee, with the written consent and approval of Lessor, shall have the privilege of removing ore and ore concentrates to other places for the purpose of completing the process of cleaning and refining the metal, when this refining may not be done to advantage on the Premises. B. Lessee, with the written consent and approval of Lessor, may hoist, crush, mill and deposit tailings and ore from other lands which in the proper course of mining shall come through the tunnels and shafts which are located on the Premises. 13. Weighing and Sampling by Mining Engineers A. When the written approval of Lessor has been secured as provided in Section 12 of this Lease, and Lessor deems it advisable in order to protect Lessor's interest, Lessor may require that ore from other properties entering the mills or other ore treatment plants, shall be weighed and sampled by one or more competent and experienced mining engineers appointed by Lessor, with the consent to this appointment by Lessee. B. The salary of the engineer or engineer so appointed, while employed in weighing and sampling ore from other properties milled on the Premises at the same time that mining and milling operations are being conducted on the Premises, shall be paid when due by Lessee. 14. Location of Holes or Shafts Lessee shall keep a log or record of each hole drilled or shaft sunk by Lessee on the Premises, showing its location, the character and formation of the rock and other substance passed through, and the percent, grade or value of gold, silver and other minerals in the hole or shaft, and will furnish Lessor or representatives of Lessor with copies of the log or record when requested in writing. 15. Maps of Mines Lessee shall keep at its mine office, clear, accurate and detailed maps of all the workings of each separate mine on the Premises. Each map of the workings shall show the location of all openings connecting with the workings of any adjacent mine, the location of all entries, gangways, rooms, shafts, subs, winzes, raises, airways, appliances, and devices constructed or placed in the mine or any of its workings. Copies of these maps shall be furnished Lessor on Lessor's written request. 16. Ownership of Tailings and Mine Refuse All tailings and mine refuse produced from the Leased Premises during the term of this Lease shall be the property of Lessor. Lessee may, subject to the written consent of Lessor, contract for the sale or disposal of the tailings and mine refuse for other purposes than retreatment at not less than the market price. In that case, Lessee shall pay Lessor _____% of the price received, provided that no contract for the sale or removal of the tailing or mine refuse shall extend beyond the term of this Lease. 17. Termination by Lessor A. Lessor shall have the right, at any time, to terminate this Lease insofar as it requires or allows Lessee to mine ore on the leased Premises, or to pay royalties, by delivering written notice of the intention to terminate to Lessee, who shall in writing acknowledge receipt of the notice. _______ (Number) days after the date of Lessee's written acknowledgment of receipt of Lessor's notice of intention to terminate, this Lease shall terminate. All arrearages and moneys which shall be due under this Lease, up to the time of the termination, shall be paid on settlement and adjustment of this Lease by Lessee. B. If any quarterly payment or any payment for royalties or any part of these payments or any tax or portion of a tax, shall remain unpaid after the expiration of _____ (number) days from the time when they are payable, or if Lessee shall fail to perform any of the covenants or conditions required to be performed, Lessor may cancel this Lease. This right to cancel shall only occur after Lessor gives to Lessee at least _______ (number) days' written notice of the alleged defaults on the part of Lessee. The notice shall set forth in detail the covenants that Lessor claims have been breached. The notice shall be sent to Lessee by certified mail, return receipt requested, at the post office address listed in this Lease, unless this address shall have been changed and notice of this change has been received and acknowledged by Lessor. C. Within this period of time, Lessee shall have the right to perform the conditions and continue this Lease. A substantial beginning of performance and a continuance of performance in good faith, shall have the effect of extending this period while performance continues. D. On the failure of Lessee to perform, Lessor may re-enter and again possess the Premises as fully as if no Lease had been given to Lessee. On Lessor's re-entry on the Premises, Lessee and all persons claiming under Lessee shall be completely excluded from the Premises. This re-entry shall not work a forfeiture of the rents, royalties or taxes or other sums to be paid at the time of the re-entry. 18. Discovery of Other Minerals Should valuable minerals other than gold ore and/or other precious metals be discovered on the Premises, the terms and conditions on which they may be mined, shall be agreed on by Lessor and Lessee. 19. Lease of Mining Equipment A. As part of the consideration for receiving Royalties as described in Paragraph 5 , Lessor leases to Lessee the mining equipment (the Equipment ) described in Exhibit A attached hereto and made a part hereof for the term of this Mineral Lease. B. Lessee agrees to take good care of said Equipment and to operate the same in a careful manner and in accordance with approved practice, and at the termination of the term of this Lease and at Lessee's expense to cause the said Equipment to be removed from the Premises and placed upon the cars at ______________ ( Name of City) , Arizona, for shipment duly consigned to the Lessor at ________________________________________ (street address, city, state, zip code) , or such other address as Lessor shall notify Lessee in writing, the said Equipment to be in as good condition as when installed, reasonable wear and tear only excepted, and to notify Lessor promptly that said shipment has been made. The Lessee shall be liable to the Lessor for all damages that may be caused to said Equipment while in transit. C. Lessee agrees to install said Equipment, and the Lessee agrees to pay all freight and installation charges on completion of installation. 20. Removal of Equipment on Termination A. On the termination of this Lease, Lessee shall have _____ (number) days within which to remove the Equipment on the Premises. B. Lessee shall not remove or impair any supports placed in the mines, or any timber or framework necessary to the use or maintenance of shafts or other approaches to the mines, or tramways within the mines, unless requested to do so by Lessor. Lessor reserves a lien on all ore mined and all improvements made by Lessee on the Premises, for any unpaid balance due under this Lease. 21. Lessee's Duty with regard to hazardous materials A. As used in this Lease, the term Hazardous Materials shall mean and include any substance that is or contains petroleum, asbestos, polychlorinated biphenyls, lead, or other substance, material, or waste which is now or is hereafter classified or considered to be hazardous or toxic under any federal, state, or local law, rule, regulation, or ordinance relating to pollution or the protection or regulation of human health, natural resources, or the environment (collectively, Environmental Laws ) or poses or threatens to pose a hazard to the health or safety of persons on or around the Leased Premises. B. Lessee agrees that during its use and operation of this Mineral Lease, it will not permit Hazardous Materials to be present on or about the Leased Premises except in a manner and quantity necessary for the ordinary performance of Lessee's business and that it will comply with all Environmental Laws relating to the use, storage, and disposal of any such Hazardous Materials. C. If Lessee's use of Hazardous Materials on or about the Leased Premises results in a release, discharge, or disposal of Hazardous Materials on, in, at, under, or emanating from, the Leased Premises Lessee agrees to investigate, clean up, remove, or remediate such Hazardous Materials in full compliance with the requirements of: (i) all Environmental Laws; and (ii) any governmental agency or authority responsible for the enforcement of any Environmental Laws. 22. Indemnification of Lessor for Injuries to Third Persons A. Lessee agrees to indemnify, hold harmless and defend Lessor at Lessee's cost against all claims for damages to persons or property arising out of or connected with Lessee's operations on or occupancy of the Leased Premises. B. Lessee agrees to accept the Premises as is and to indemnify and hold Lessor harmless for any damages incurred by Lessor arising out of damage to property or the personal injury or death of the employees or agents of Lessee, where such damage arises on account of or in connection with the use, operation or development of the Premises by Lessee. Lessee shall carry at its own cost a combined single limit commercial general liability form policy of insurance in the amount of at least $_____________ indemnifying and holding Lessor and Lessee harmless from and against all claims for injuries and death sustained by Lessee's employees, consultant's or agents or damage to property on the Leased Premises. Lessee will provide Lessor with proper certificate documentation providing evidence that Lessee has obtained all required insurance coverage, including but not limited to worker's compensation insurance for its employees and business. Lessor agrees, warrants and represents that he has taken all action necessary to enter into this Lease Agreement, and this Lease Agreement is a binding obligation. 23. Severability The invalidity of any portion of this Agreement will not and shall not be deemed to affect the validity of any other provision. If any provision of this Agreement is held to be invalid, the parties agree that the remaining provisions shall be deemed to be in full force and effect as if they had been executed by both parties subsequent to the expungement of the invalid provision. 24. No Waiver The failure of either party to this Agreement to insist upon the performance of any of the terms and conditions of this Agreement, or the waiver of any breach of any of the terms and conditions of this Agreement, shall not be construed as subsequently waiving any such terms and conditions, but the same shall continue and remain in full force and effect as if no such forbearance or waiver had occurred. 25. Governing Law This Agreement shall be governed by, construed, and enforced in accordance with the laws of the State of Arizona. 26. Notices Unless provided herein to the contrary, any notice provided for or concerning this Agreement shall be in writing and shall be deemed sufficiently given when sent by certified or registered mail if sent to the respective address of each party as set forth at the beginning of this Agreement. 27. Attorney’s Fees In the event that any lawsuit is filed in relation to this Agreement, the unsuccessful party in the action shall pay to the successful party, in addition to all the sums that either party may be called on to pay, a reasonable sum for the successful party's attorney fees. 28. Mandatory Arbitration Any dispute under this Agreement shall be required to be resolved by binding arbitration of the parties hereto. If the parties cannot agree on an arbitrator, each party shall select one arbitrator and both arbitrators shall then select a third. The third arbitrator so selected shall arbitrate said dispute. The arbitration shall be governed by the rules of the American Arbitration Association then in force and effect. 29. Entire Agreement This Agreement shall constitute the entire agreement between the parties and any prior understanding or representation of any kind preceding the date of this Agreement shall not be binding upon either party except to the extent incorporated in this Agreement. 30. Modification of Agreement Any modification of this Agreement or additional obligation assumed by either party in connection with this Agreement shall be binding only if placed in writing and signed by each party or an authorized representative of each party. 31. Assignment of Rights The rights of each party under this Agreement are personal to that party and may not be assigned or transferred to any other person, firm, corporation, or other entity without the prior, express, and written consent of the other party. 32. Counterparts This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all of which together shall constitute but one and the same instrument. 33. Compliance with Laws In performing under this Agreement, all applicable state and federal governmental laws, regulations, orders, and other rules of duly-constituted authority will be followed and complied with in all respects by both parties. The parties have executed this agreement at ____________________________ ________________ (place of execution) the day and year first above written. WITNESS our signatures as of the day and date first above stated. ________________________ _________________________ (P rinted Name of Lessor) (P rinted Name of Lessee) ________________________ _________________________ (Signature of Lessor) (Signature of Lessee) Attach Exhibit s State of Arizona County of _______________ The foregoing instrument was acknowledged before me this ____ day of ______________, 20____ by _____________________ (Name of Lessor) , a person. _____________________________ NOTARY PUBLIC (Printed Name of Notary Public) My Commission Expires: ________________ State of Arizona County of ___________________ The foregoing instrument was acknowledged before me this ____ day of ______________, 20_____ by _________________ (Name of Lessee) , a person. _____________________________ NOTARY PUBLIC (Printed Name of Notary Public) My Commission Expires: ____________ Lessor’s Name, Address and Phone: Lessee’s Names, Address and Phone: __________________________________ _________________________________ __________________________________ _________________________________ __________________________________ _________________________________ __________________________________ _________________________________