ENGLISH VERSION OF 2008 LEASE AGREEMENT BY AND BETWEEN COMMERCE GROUP CORP. AND CORSAIN WE, GINO ROLANDO BETTAGLIO RIVAS of fifty four years of age, Bachelor in Economy, of domicile in Antiguo Cuscatlan, Department of La Libertad, bearer of my Sole...
EXHIBIT 10.16
ENGLISH VERSION OF 2008 LEASE AGREEMENT
BY AND BETWEEN COMMERCE GROUP CORP. AND CORSAIN
WE, XXXX XXXXXXX XXXXXXXXX XXXXX of fifty four years of age, Bachelor in
Economy, of domicile in Antiguo Cuscatlan, Department of La Libertad,
bearer of my Sole Identity Document number zero two million one hundred
eighty three thousand eight hundred seventy seven acting in the name and
representation, in his capacity of President and Legal Representative of
the CORPORACION SALVADORENA DE INVERSIONES that is abbreviated CORSAIN,
official Institution of Autonomous character, of this domicile, with Tax
Identification Number zero six hundred fourteen - zero ten thousand one
hundred eighty two zero zero one-one; who in the course of this document
will be called "THE LESSEE" OR CORSAIN; for the other part Xx. XXXXXX X.
XXXXXXXX OF FIFTY SIX years of age, businessman, of American nationality,
bearer of passport number TWO ZERO SEVEN FIVE SIX SEVEN ONE ZERO ZERO,
issued by the immigration authorities of that country, the day of
December 18, of the year two thousand two, with expiration dat e of
December 17, of the year two thousand twelve, in capacity of Special
Power for the company COMMERCE GROUP CORP, corporation of the State of
Wisconsin, United States of America, who for not speaking or reading
Spanish is accompanied by his translator Mr. XXXX XXXXXX XXXXX, of sixty
seven years of age, businessman, of nationality of the United States of
America, bearer of passport number zero four five five two seven three
six two, issued by the Migratory Authorities of that country, the day of
July 13, of one thousand nine hundred ninety nine, with expiration date
of July 12, of two thousand nine; the company referred to above
henceforth will be called "THE LESSOR", through this instrument we agree
to sign a SIMPLE LEASING CONTRACT" which will be subject to the following
clauses: I. DECLARATION OF DOMINION. That the leasing entity is owner
and current possessor of a portion of rustic land and constructions that
it contains, that was dismembered from a land of greater size of SIX TY
SIX HECTARES SEVENTY TWO AREAS FIVE POINT TWENTY FIVE CENTIAREAS,
equivalent to NINETY SIX MANZANAS EIGHT THOUSAND NINE HUNDRED SIXTY FOUR
POINT TWENTY THREE SQUARE VARAS, that forms part of the CORSAIN property,
known jointly as MONTECRISTO MINES, located in
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Jurisdiction of Jocoro, Department of Xxxxxxx, inscribed in favor of
CORSAIN to Number ONE HUNDRED SEVENTY NINE of the Book TWO HUNDRED
SEVENTY FIVE of the Registry of Property in Morazan whose description is
the following: Starting from the geodesic marker Xxxxx Xxxxxxxx in
direction North fifty six degrees zero six point zero minutes West and a
distance of ninety six point fifty four meters one arrives at a point
from where with direction North twenty five degrees thirty four
point zero minutes East and a distance of one hundred meters, one
arrives at another point from where with direction North twenty eight
degrees thirty four point three minutes East and a distance of one
hundred meters one arrives at another point from where with direction
North thirty eight degrees thirty four point six minutes East and a
distance of three hundred meters one arrives at another point from where
with direction North forty one degrees fifteen point zero minutes
East and at a distance of three hundred meters is found the corner
South-West of the property that is described below, whose measures
and borders are the following: TO THE WEST: Straight line with
direction North thirty six degrees forty two point sixty five minutes
West and a distance of eight hundred thirty eight point zero fifty six
meters, bordering with lands of the general property of greater capacity
property of CORSAIN; TO THE NORTH: broken line that consists of thirty
one straight lines; the first with direction North seventy three
degrees twenty four point fifty eight minutes East and a distance of
sixty three meters twenty one centimeters; the second with direction
North forty three degrees thirty six point thirty one minutes East and a
distance of forty meters sixty nine centimeters; the third with direction
North thirty six degrees forty two point sixty six minutes East and a
distance of fifty six meters sixty eight centimeters; the fourth with
direction North forty three degrees eighteen point eighty four
minutes East and a distance of eighty one meters thirty centimeters,
eight millimeters; the fifth with direction North seven degrees three
point twenty one minutes East and a distance of twenty meters eighty
four centimeters, eight millimeters; the sixth with direction North
seventy degrees fifty six point seven minutes West and a distance of
thirteen meters fifty centimeters; the seventh with a direction North
seventy degrees forty point fourteen minutes West and a distance of
forty seven meters sixty centimeters, six millimeters; the eighth
with direction North and one degree thirty six point forty seven
minutes East and a distance of forty eight meters twenty one centimeters,
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millimeters; the ninth with direction North forty five degrees fifty one
point ninety seven minutes East and a distance of ninety eight meters
thirty seven centimeters, two millimeters; the tenth with direction
North forty three degrees fifty nine point zero seven minutes East and a
distance of one hundred forty meters twenty three centimeters, one
millimeter; the eleventh with direction South twenty nine degrees
thirty seven point sixty minutes East and a distance of thirty one
meters, ninety three centimeters, five millimeters; the twelfth with
direction South forty five degrees twenty three point eighty seven
minutes East and a distance of forty four meters eighty centimeters,
three millimeters; the thirteenth with direction South forty one
degrees two point fifty one minutes East and a distance of thirty
meters forty five centimeters, five millimeters; the fourteenth with
direction South sixty six degrees sixteen point thirty one minutes East
and a distance of twenty five meters eighty seven centimeters; the
fifteenth with direction North seventy three degrees thirteen point
thirteen minutes East and a distance of fifteen meters, sixty nine
centimeters; the sixteenth with direction South eighty degrees
seventeen point fifty two minutes East and a distance of twenty nine
meters forty one centimeters, four millimeters; the seventeenth with
direction South five degrees forty eight point seventy four minutes West
and a distance of fifty two meters, sixty seven centimeters, one
millimeter; the eighteenth with direction South twenty five degrees
fifty eight point sixty nine minutes East and a distance of thirty two
meters, twenty centimeters, six millimeters; the nineteenth with
direction South forty four degrees forty one point forty nine minutes
East and a distance of thirty two meters, ninety seven centimeters, two
millimeters; the twentieth with direction south sixty degrees thirty
nine point twenty six minutes East and a distance of forty six
meters, twenty five centimeters, eight millimeters; the twenty first
with direction South fifty one degrees one point one seventy one minutes
East and a distance of thirty eight meters, one millimeter; the twenty
second with direction South seventy degrees forty two point eleven
minutes East and a distance of twenty six meters, twenty centimeters,
two millimeters; the twenty third with direction South seventy nine
degrees forty nine degrees forty four point forty five minutes
East and a distance of ten meters fifty five centimeters, six
millimeters; the twenty fourth with direction North seventy degrees
sixty five point eight minutes East and a distance of twenty seven
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meters twenty one centimeters, eight millimeters; the twenty fifth with
direction North fifty eight degrees twenty nine point twelve minutes
East and a distance of one hundred five meters, fifty eight
centimeters, three millimeters; the twenty sixth with direction
South eighty degrees thirty eight point ninety two minutes East and a
distance of twenty meters, sixty one centimeters, seven millimeters; the
twenty seventh with direction South fifty one degrees zero point
eighty four minutes East and a distance of eleven meters, ninety
centimeters, five millimeters; the twenty eighth with direction South
forty two degrees fifty three point thirty seven minutes East and a
distance of eighty four meters, seventy seven centimeters, two
millimeters; the twenty ninth with direction South seventy six degrees
forty seven point forty six minutes East and a distance of eighty nine
meters, five centimeters, seven millimeters; the thirtieth with
direction South seventy seven degrees forty five point thirteen minutes
East and a distance of thirty meters, eighty two centimeters, nine
millimeters; the thirty first with direction South sixty four degrees
fifty one point fourteen minutes East and a distance of sixteen meters,
thirty centimeters, eight millimeters. All the pieces border with
lands of Mr. Xxxx Xxxxxxxx, deep ravine in the middle, TO THE EAST:
Broken line made up by twenty one straight lines: the first with
direction South forty one degrees forty seven point sixty eight
minutes West and a distance of forty nine meters, fifty six
centimeters, two millimeters; the second with direction South twenty
seven degrees forty point eighty six minutes West and a distance of
forty five meters, twenty three centimeters, eight millimeters;
the third with direction South twenty nine degrees fifty seven point
nineteen minutes West and a distance of thirty two meters, twenty eight
centimeters, two millimeters; the fourth with direction South eighteen
degrees twenty eight point zero one minutes West and a distance of eleven
meters, ninety five centimeters, six millimeters; the fifth with
direction South seventeen degrees thirty point ninety seven minutes
East and a distance of nine meters, seventy four centimeters, two
millimeters; the sixth with direction South forty one degrees thirty
five point fifty three minutes East and a distance of twenty seven
meters, six centimeters, three millimeters; the seventh with
direction South eighty seven degrees twenty three point ninety three
minutes East and a distance of thirty two meters, seventeen centimeters,
one millimeter; the eighth with direction North eighty one degrees
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zero point zero five minutes East and a distance of twenty meters, ninety
centimeters, five millimeters; the ninth with direction South eighty
eight degrees zero seven point twenty five minutes East and a distance
of twenty eight meters, ninety seven centimeters; the tenth with
direction South eighty five degrees zero two point eleven minutes
East and a distance of twenty six meters, fifty seven centimeters, six
millimeters; the eleventh with direction South eighty two degrees
fifty eight point forty nine minutes East and a distance of twenty six
meters, forty nine centimeters, one millimeter; the twelfth with
direction South eleven degrees zero zero point thirty six minutes and
a distance of twelve meters, seventy five centimeters, five
millimeters; the thirteenth with direction South twelve degrees thirty
five point seventeen minutes West and a distance of sixty nine
meters, two centimeters, nine millimeters; the fourteenth with
direction South six degrees twenty four point sixteen minutes East
and a distance of twenty six meters ninety three centimeters, eight
millimeters; the fifteenth with direction South seventy degrees sixteen
point twenty nine minutes East and a distance of fifty five meters
forty eight centimeters, six millimeters; the sixteenth with
direction South sixty seven degrees fifty one point fifty two minutes
East and a distance of forty meters, eighty centimeters, seven
millimeters; the seventeenth with direction South thirty three
degrees twenty three point thirty two minutes East and a distance of
twenty two meters, fifty one centimeters, six millimeters; the eighteenth
with direction South four degrees eighty two point zero three minutes
West and a distance of twenty six meters, seventy four
centimeters, four millimeters; the nineteenth with direction South
forty one degrees twenty six point twenty seven minutes West and a
distance of seventy meters, thirty one centimeters, one millimeter;
the twentieth with direction South twenty one degrees forty nine
point thirty one minutes East and a distance of forty six meters,
seventy three centimeters, nine millimeters; the twenty first with
direction South forty four degrees twenty point fifty minutes
East and a distance of sixty one meters, eighty four centimeters, four
millimeters. The first fifteen pieces border with lands of Mr. Xxxx
Xxxxxxxx, deep ravine in the middle; the other six pieces border with
Colonia Xxxxx Xxxxxx; TO THE SOUTH: Broken line made up of thirteen
straight lines: the first with direction South seventy degrees fifty
seven point fifty seven minutes West and a distance of fifty meters,
ninety two centimeters, six millimeters;
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the second with direction South sixty seven degrees twenty four
point forty one minutes West and a distance of fifty seven meters,
eighty one centimeters, six millimeters; the third with direction
South sixty two degrees thirty nine point seventy nine minutes West
and a distance of fifty nine meters, thirteen centimeters, eight
millimeters; the fifth with direction South fifty seven degrees forty
eight point forty eight minutes West and a distance of thirty seven
meters, ninety six centimeters, three millimeters; the seventh with
direction South fifty two degrees forty five point forty four minutes
West and a distance of forty three meters, sixty two centimeters, eight
millimeters; the eighth with direction South fifty four degrees fifty
five point forty one minutes West and a distance of one hundred twenty
six meters, fourteen centimeters, two millimeters; the ninth with
direction South fifty six degrees zero three point zero one minutes West
and a distance of two hundred thirty four meters, ninety six
centimeters, four millimeters; the tenth with direction North seventy
degrees twenty nine point twenty nine minutes West and a distance of two
meters, three centimeters, six millimeters; the eleventh with
direction North twenty five degrees North zero four point twenty eight
minutes East and a distance of one meter, seventy one centimeters, six
millimeters; the twelfth with direction North seventy one degrees fifty
three point forty one minutes West and a distance of six meters, twenty
nine centimeters, six millimeters; the thirteenth with direction South
thirteen degrees forty three point ninety five minutes West and a
distance of sixteen meters, seventy centimeters, six millimeters;
arriving thus to the Southwest corner where the present description
started. The first eight (straight line) sections border with lands
known as Montecristo Isle, property of CORSAIN. The other five pieces
border with lands of Xx. Xxxxxxx Xxxxxxx; the thirteen prior pieces
border with the Ruta Militar Highway with Santa Xxxx xx Xxxx in the
middle. That on the built area of the land that is leased there is
found iron and wood galleys with roofs of channeled, laminated
metal, also property of CORSAIN. II.) OBJECT OF THE CONTRACT. Both
parties agree that for having incurred in past due payments on the lease,
application of clause V) of the original contract was made in such sense
and having paid the past due amount, we agree to sign a new contract that
will be governed under the clauses that are detailed in this instrument.
The representative of the lessor delivers in simple lease to the lessee
the portion of the land described above and in such
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capacity the lessee's special Power receives the referred to property to
his complete satisfaction, obliging himself to return it to the lessor in
the same conditions at the termination of the lease term. III) TERM AND
EXTENSION. The term of the lease is agreed to for nineteen months
starting counting from the day of November 12 of the year two thousand
six with expiration on the day of June 11 of the year two thousand eight,
both dates inclusive, which will be extended automatically each three
months, always and when, there does not exist an express statement on the
part of CORSAIN to terminate it in the established term with at least
thirty days of advance notice. If the Lessee complies with the clauses of
this contract in joint agreement with the Lessor they may decide to
continue with the lease, its conditions will be discussed and protected
under a new contract. In the case that the Lessee deoccupies the property
under lease before the end of the term it should pay and all the surface
taxes pending as if it were the end of the term. IV) PRICE AND FORM OF
PAYMENT: The total price of the lease during the first year is EIGHTEEN
THOUSAND SIX HUNDRED EIGHT DOLLARS WITH TWENTY XXX XXXXX XX X XXXXXX XX
XXX XXXXXX XXXXXX OF AMERICA ($18,608.21) PLUS THE CORRESPONDING TAX FOR
THE Transfer of Real Estate and the Rendering of Services (VAT), payable
through monthly quotas, successive and beforehand, the first for ONE
THOUSAND FIVE HUNDRED FIFTY DOLLARS WITH SIXTY EIGHT CENTS OF A DOLLAR OF
THE UNITED STATES OF AMERICA, ($1,550.68), PLUS THE CORRESPONDING TAX FOR
THE Transfer of Real Estate and the Rendering of Services (VAT). This
price will be increased annually in conformance to the inflation rate of
the United States of America and the increase will begin once the
corresponding report is obtained from the Embassy of that country
accredited in E l Salvador and will be added to the corresponding monthly
quota effective on the twenty fifth day of the month of each one of the
months included in the term. V) EFFECTS OF THE PAST DUE: The delay in
payment of one of the quotas agreed to will cause the term to end, giving
the right to the Lessor to require the Lessee the immediate deoccupation
of the leased property, without need for any judicial process and require
him executively to pay the owed taxes as well as those that remain to be
complied with for the original term, including the termination of the
contract as the case may be. VI) DEPOSIT. Both parties agree
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that the obligations contracted in the present instrument on the part of
the Lessor are guaranteed with the deposits made by it in favor of the
Lessee for the amount of ELEVEN THOUSAND SEVEN HUNDRED AND FORTY ONE
DOLLARS WITH FIFTY CENTS OF A DOLLAR OF THE UNITED STATE OF AMERICA
protected by income receipt number six thousand seven hundred and seventy
four-A, dated November 15 of one thousand nine hundred ninety three and
deposited to the account of CORSAIN dated February 16, one thousand nine
hundred ninety five for the amount of THREE HUNDRED AND THIRTY THREE
DOLLARS WWWITH FIFTY CENTS OF A DOLLAR OF THE UNITED STATES OF AMERICA,
that will serve to respond for the owed taxes or for payments which the
Lessee might incur and that were charges of the Lessor and which will be
returned to him in a term of thirty days following the termination of the
present contract, in case what was mentioned above does not happen. VII)
SPECIAL CONDITIONS: The Lessor commits to: 1) inform in writing to
CORSAIN within thirty days following the date of this instrument, about
which installations will be used, upon not doing it, he will incur a fine
equivalent to one quarter of the lease price. 2) The Lessor will not be
responsible for the deterioration that these installations suffer and
that are not used by them. 3) Answer for all kinds of damages that may
be caused as a consequence of the operations that are done in the leased
property. 4) The Lessor may make use of the water resources that are
within the leased portion and of the sources known as Santa Francisca,
Adolfo, Quebrada Seca and Quebrada Honda for whose use the corresponding
rights of way for transit and aqueducts will be constituted, it ought to
use these by means of underground piping. In addition the Lessee
authorizes to the Lessor to construct a tank in the source known as
Xxxxxx. It is understood that the ac cess to the sources mentioned and
the use of the water coming from these does not have an exclusive
character for the Lessor; 5) The Lessor will have the right to use the
surface of the leased area to construct, maintain, repair installations,
machinery, materials and residues from the ore that will be brought to be
processed in said place, as well as build roads, trenches, deposits for
minerals, waste and ore, piping for potable water, telephone lines,
electric lines of transmission and distribution. As well, it may build
all the facilities necessary to use what is leased for the end of
crushing, milling and processing of raw material and precious mineral
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ore, all on the account of the Lessor. The use of what is leased should
be the most adequate in accordance with the works that the Lessor
proposes to carry out on the property object of this contract and in
whose execution he is obliged to not cause any ecological damages; and 6)
In the case that Corsain decides to sell the property object of the
present contract, it is obliged to give a preferential right to COMMERCE
GROUIP to acquire dominion over it, always if the proposed conditions of
sale are accepted, to the contrary, CORSAIN remains free to terminate the
lease contract without anymore responsibility than to give the respective
notice to the Lessor. VIII) RIGHTS OF THE LESSEE: The Lessee will have
free access to the leased property for the purpose of inspection, being
able to delegate such faculty to the person or persons it deems
convenient, for which it will give prior notice to the Lessor of the
reasons for its decision with at least two days of anticip ation for
reasons of security. IX). DESTINY OF USE. The leased property will be
destined exclusively for the use of the surface of the leased area to
construct, maintain, repair installations, machinery, residues of ore
that will be brought to be processed in said place, as well to build
roads, trenches, deposits for minerals, waste and ore, piping for potable
water, telephone lines, electric transmission and distribution lines; to
construct all the facilities necessary to use what is leased to the end
of crushing, milling and processing raw materials and ore of precious
minerals. X). PROHIBITIONS. A) The Lessee may not exploit any mineral
that might exist on the leased property in virtue of the fact that the
present contract only covers the use of the surface of the land and the
use of the installations for the purpose of processing and storing
mineral ore brought from outside of the same property. If the Lessor
finds gold, silver, or other mineral and plans to exploit it, i t should
sign a new contract with the Corporacion Salvadorena de Inversiones
different from what by means of this instrument is being signed; b) The
Lessor commits to not store on the leased property inflammable, explosive
substances and all those that are prohibited by the law or that put the
Lessee at risk or its affiliates and in general any person or asset. In
cases where by the nature of the work carried out by the Lessor it is
necessary to use any of the substances previously mentioned, it is
responsible exclusively for the consequences derived from their wrongful
use.
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c) The Lessor cannot sublease in part or in total nor cede its rights to
the property given in lease without prior written permission from the
Lessee. Any violation of the present prohibitions will be cause for
terminating the present contract. XI) FINES. The fines that are imposed
for infractions to municipal sanitary regulations will be on the account
of the Lessor or any others that are related to the business. XII)
SPECIAL CLAUSE. The Lessee is exonerated from all responsibility when the
acts and transactions that the Lessor carries out are not in conformance
to the laws of the Republic; and indeed it is proven that it is doing
them, will also be cause for termination of the contract, thus ending the
original term and any extensions. XIII. LOCAL REPAIRS. During the lease
term or its extensions the Lessor will make: 1) All the expenditures that
are generated by the construction and repair of buildings and for the
repair of machinery and equipment will be on the account of the Lessor,
2) Upon ending the term of the present lease, the improvements and
constructions that the Lessor may have done on the leased property will
remain without any cost, in favor of CORSAIN with the exception of the
installations that are removable, equipment, machinery, spare parts,
inventories and raw material which the Lessor may withdraw always when
these are identified as its property and that with the withdrawal the
leased property not suffer any deterioration. XIV. TERMINATION. The term
of the present contract will end and the Lessee will have the right to
declare it ended without the need for any judicial intervention and the
Lessor should deoccupy immediately the leased property in any of the
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following cases: a) For late payment of one of the lease quotas in the
form in which it has been agreed to in this instrument after sixty days
of having been notified of the existence of the past due payment; b) For
an executed sentence coming from an execution brought against the Lessor
by third parties or by CORSAIN for obligation distinct from the contents
in this document; c) If the Lessor subleases or cedes its right in the
lease or if it permits access of third parties so that they explore or
exploit the mines without the prior authorization of CORSAIN; d) For
having used the leased property for work that is distinct from those that
in conformance to this contract it plans to carry out; e) For
non-compliance of the obligations contracted according to what is
established in Roman number VII of this contract; f) For non-fulfillment
or contravention on the part of the Lessor of any of the obligations
consigned in this instrument, g) When the Lessor does not comply with
any of the obligations and special conditions stipulated in it, the
Lessee will have the right to retain all or part of the quantity given in
deposit to recover from the damages and harm caused; as well as fulfill
what is established in Clause VII of this contract. XV). SPECIAL
DOMICILE. For the purpose of the obligations contracted in the present
contract, both parties set as special domicile that of this city and to
the competence of whose Tribunals we submit. Swearing to the above, we
sign in the city of San Salvador at twenty five days of the month of
March of the year two thousand eight.
LIC. XXXX XXXXXXX XXXXXXXXX XXXXX XXXXXX X. XXXXXXXX
President of CORSAIN Power of Attorney of Commerce Group
Signatures plus that of Xxxx X. Xxxxx
In the city of San Salvador, at nine hors of the day of March 25 of the
year two thousand eight; Before me XXXXXXX MAAAURICIO XXXXXXXX XXXXXXXX,
Notary, from this domicile, APPEAR: For one party XXXX XXXXXXX XXXXXXXXX
XXXXX of fifty four years of age, Bachelor in Economy, of domicile in
Antiguo Cuscatlan, Department of La Libertad, bearer of my Sole Identity
Document number zero two million one hundred eighty three thousand eight
hundred seventy seven acting in the name and representation, in his
capacity of President and Legal Representative of the CORPORACION
SALVADORENA DE INVERSIONES that is abbreviated CORSAIN, official
Institution of Autonomous character, of this domicile, with Tax
Identification Number zero six hundred fourteen - zero ten thousand one
hundred eighty two zero zero one-one; who in the course of this document
will be called "THE LESSEE" OR CORSAIN; for the other part Xx. XXXXXX X.
XXXXXXXX OF FIFTY SIX years of age, businessman, of American nationality,
bearer
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of passport number TWO ZERO SEVEN FIVE SIX SEVEN ONE ZERO ZERO, issued by
the immigration authorities of that country, the day of December 18, of
the year two thousand two, with expiration date of December 17, of the
year two thousand twelve, in capacity of Special Power for the company
COMMERCE GROUP CORP, corporation of the State of Wisconsin, United States
of America, who for not speaking or reading Spanish is accompanied by his
translator Mr. XXXX XXXXXX XXXXX, of sixty seven years of age,
businessman, of nationality of the United States of America, bearer of
passport number zero four five five two seven three six two, issued by
the Migratory Authorities of that country, the day of July 13, of one
thousand nine hundred ninety nine, with expiration date of July 12, of
two thousand nine; the company referred to above henceforth will be
called "THE LESSOR", through this instrument we agree to sign a SIMPLE
LEASING CONTRACT" which will be subject to the following clauses: I.
DECLARATION OF DOMINION. That the leasing entity is owner and current
possessor of a portion of rustic land and constructions that it contains,
that was dismembered from a land of greater size of SIXTY SIX HECTARES
SEVENTY TWO AREAS FIVE POINT TWENTY FIVE CENTIAREAS, equivalent to NINETY
SIX MANZANAS EIGHT THOUSAND NINE HUNDRED SIXTY FOUR POINT TWENTY THREE
SQUARE VARAS, that forms part of the CORSAIN property, known jointly as
MONTECRISTO MINES, located in Jurisdiction of Jocoro, Department of
Xxxxxxx, inscribed in favor of CORSAIN to Number ONE HUNDRED SEVENTY NINE
of the Book TWO HUNDRED SEVENTY FIVE of the Registry of Property in
Morazan whose description is the following: Starting from the geodesic
marker Xxxxx Xxxxxxxx in direction North fifty six degrees zero six
point zero minutes West and a distance of ninety six point fifty four
meters one arrives at a point from where with direction North twenty
five degrees thirty four point zero minutes East and a distance of one
hundred meters, one arrives at another point from where with direction
North twenty eight degrees thirty four point three minutes East and a
distance of one hundred meters one arrives at another point from where
with direction North thirty eight degrees thirty four point six
minutes East and a distance of three hundred meters one arrives at
another point from where with direction North
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forty one degrees fifteen point zero minutes East and at a distance of
three hundred meters is found the corner South-West of the property
that is described below, whose measures and borders are the
following: TO THE WEST: Straight line with direction North thirty six
degrees forty two point sixty five minutes West and a distance of eight
hundred thirty eight point zero fifty six meters, bordering with lands
of the general property of greater capacity property of CORSAIN; TO THE
NORTH: broken line that consists of thirty one straight lines; the
first with direction North seventy three degrees twenty four point
fifty eight minutes East and a distance of sixty three meters twenty one
centimeters; the second with direction North forty three degrees
thirty six point thirty one minutes East and a distance of forty meters
sixty nine centimeters; the third with direction North thirty six degrees
forty two point sixty six minutes East and a distance of fifty six
meters sixty eight centimeters; the fourth with direction North
forty three degrees eighteen point eighty four minutes East and a
distance of eighty one meters thirty centimeters, eight millimeters;
the fifth with direction North seven degrees three point twenty one
minutes East and a distance of twenty meters eighty four centimeters,
eight millimeters; the sixth with direction North seventy degrees
fifty six point seven minutes West and a distance of thirteen meters
fifty centimeters; the seventh with a direction North seventy degrees
forty point fourteen minutes West and a distance of forty seven meters
sixty centimeters, six millimeters; the eighth with direction North
and one degree thirty six point forty seven minutes East and a distance
of forty eight meters twenty one centimeters, four millimeters; the
ninth with direction North forty five degrees fifty one point ninety
seven minutes East and a distance of ninety eight meters thirty seven
centimeters, two millimeters; the tenth with direction North forty
three degrees fifty nine point zero seven minutes East and a distance of
one hundred forty meters twenty three centimeters, one millimeter; the
eleventh with direction South twenty nine degrees thirty seven point
sixty minutes East and a distance of thirty one meters, ninety three
centimeters, five millimeters; the twelfth with direction South forty
five degrees twenty three point eighty seven minutes East and a
distance of forty four meters eighty centimeters, three millimeters;
the thirteenth with direction South forty one degrees two point fifty one
minutes East and a distance of thirty meters forty five centimeters,
five millimeters; the fourteenth
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with direction South sixty six degrees sixteen point thirty one minutes
East and a distance of twenty five meters eighty seven centimeters; the
fifteenth with direction North seventy three degrees thirteen point
thirteen minutes East and a distance of fifteen meters, sixty nine
centimeters; the sixteenth with direction South eighty degrees
seventeen point fifty two minutes East and a distance of twenty nine
meters forty one centimeters, four millimeters; the seventeenth with
direction South five degrees forty eight point seventy four minutes West
and a distance of fifty two meters, sixty seven centimeters, one
millimeter; the eighteenth with direction South twenty five degrees
fifty eight point sixty nine minutes East and a distance of thirty two
meters, twenty centimeters, six millimeters; the nineteenth with
direction South forty four degrees forty one point forty nine minutes
East and a distance of thirty two meters, ninety seven centimeters, two
millimeters; the twentieth with direction south sixty degrees thirty
nine point twenty six minutes East and a distance of forty six
meters, twenty five centimeters, eight millimeters; the twenty first
with direction South fifty one degrees one point one seventy one minutes
East and a distance of thirty eight meters, one millimeter; the twenty
second with direction South seventy degrees forty two point eleven
minutes East and a distance of twenty six meters, twenty centimeters, two
millimeters; the twenty third with direction South seventy nine degrees
forty nine degrees forty four point forty five minutes East and a
distance of ten meters fifty five centimeters, six millimeters; the
twenty fourth with direction North seventy degrees sixty five point
eight minutes East and a distance of twenty seven meters twenty one
centimeters, eight millimeters; the twenty fifth with direction North
fifty eight degrees twenty nine point twelve minutes East and a
distance of one hundred five meters, fifty eight centimeters, three
millimeters; the twenty sixth with direction South eighty degrees
thirty eight point ninety two minutes East and a distance of twenty
meters, sixty one centimeters, seven millimeters; the twenty seventh
with direction South fifty one degrees zero point eighty four minutes
East and a distance of eleven meters, ninety centimeters, five
millimeters; the twenty eighth with direction South forty two degrees
fifty three point thirty seven minutes East and a distance of eighty
four meters, seventy seven centimeters, two millimeters; the twenty
ninth with direction South seventy six degrees forty seven point forty
six minutes East and a distance of eighty
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nine meters, five centimeters, seven millimeters; the thirtieth with
direction South seventy seven degrees forty five point thirteen minutes
East and a distance of thirty meters, eighty two centimeters, nine
millimeters; the thirty first with direction South sixty four degrees
fifty one point fourteen minutes East and a distance of sixteen meters,
thirty centimeters, eight millimeters. All the pieces border with
lands of Mr. Xxxx Xxxxxxxx, deep ravine in the middle, TO THE EAST:
Broken line made up by twenty one straight lines: the first with
direction South forty one degrees forty seven point sixty eight
minutes West and a distance of forty nine meters, fifty six
centimeters, two millimeters; the second with direction South twenty
seven degrees forty point eighty six minutes West and a distance of
forty five meters, twenty three centimeters, eight millimeters; the
third with direction South twenty nine degrees fifty seven point
nineteen minutes West and a distance of thirty two meters, twenty eight
centimeters, two millimeters; the fourth with direction South eighteen
degrees twenty eight point zero one minutes West and a distance of eleven
meters, ninety five centimeters, six millimeters; the fifth with
direction South seventeen degrees thirty point ninety seven minutes
East and a distance of nine meters, seventy four centimeters, two
millimeters; the sixth with direction South forty one degrees thirty
five point fifty three minutes East and a distance of twenty seven
meters, six centimeters, three millimeters; the seventh with
direction South eighty seven degrees twenty three point ninety three
minutes East and a distance of thirty two meters, seventeen centimeters,
one millimeter; the eighth with direction North eighty one degrees zero
point zero five minutes East and a distance of twenty meters, ninety
centimeters, five millimeters; the ninth with direction South eighty
eight degrees zero seven point twenty five minutes East and a distance
of twenty eight meters, ninety seven centimeters; the tenth with
direction South eighty five degrees zero two point eleven minutes
East and a distance of twenty six meters, fifty seven centimeters, six
millimeters; the eleventh with direction South eighty two degrees
fifty eight point forty nine minutes East and a distance of twenty six
meters, forty nine centimeters, one millimeter; the twelfth with
direction South eleven degrees zero zero point thirty six minutes and
a distance of twelve meters, seventy five centimeters, five
millimeters; the thirteenth with direction South twelve degrees thirty
five point seventeen minutes West and a distance of sixty nine
meters, two centimeters,
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nine millimeters; the fourteenth with direction South six degrees twenty
four point sixteen minutes East and a distance of twenty six meters
ninety three centimeters, eight millimeters; the fifteenth with
direction South seventy degrees sixteen point twenty nine minutes East
and a distance of fifty five meters forty eight centimeters, six
millimeters; the sixteenth with direction South sixty seven degrees
fifty one point fifty two minutes East and a distance of forty meters,
eighty centimeters, seven millimeters; the seventeenth with
direction South thirty three degrees twenty three point thirty two
minutes East and a distance of twenty two meters, fifty one centimeters,
six millimeters; the eighteenth with direction South four degrees eighty
two point zero three minutes West and a distance of twenty six
meters, seventy four centimeters, four millimeters; the nineteenth
with direction South forty one degrees twenty six point twenty seven
minutes West and a distance of seventy meters, thirty one centimeters,
one millimeter; the twentieth with direction South twenty one degrees
forty nine point thirty one minutes East and a distance of forty six
meters, seventy three centimeters, nine millimeters; the twenty
first with direction South forty four degrees twenty point fifty
minutes East and a distance of sixty one meters, eighty four
centimeters, four millimeters. The first fifteen pieces border with
lands of Mr. Xxxx Xxxxxxxx, deep ravine in the middle; the other six
pieces border with Colonia Xxxxx Xxxxxx; TO THE SOUTH: Broken line
made up of thirteen straight lines: the first with direction South
seventy degrees fifty seven point fifty seven minutes West and a
distance of fifty meters, ninety two centimeters, six millimeters; the
second with direction South sixty seven degrees twenty four point
forty one minutes West and a distance of fifty seven meters, eighty
one centimeters, six millimeters; the third with direction South
sixty two degrees thirty nine point seventy nine minutes West and a
distance of fifty nine meters, thirteen centimeters, eight
millimeters; the fifth with direction South fifty seven degrees forty
eight point forty eight minutes West and a distance of thirty seven
meters, ninety six centimeters, three millimeters; the seventh with
direction South fifty two degrees forty five point forty four minutes
West and a distance of forty three meters, sixty two centimeters,
eight millimeters; the eighth with direction South fifty four degrees
fifty five point forty one minutes West and a distance of one hundred
twenty six meters, fourteen centimeters, two
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millimeters; the ninth with direction South fifty six degrees zero
three point zero one minutes West and a distance of two hundred thirty
four meters, ninety six centimeters, four millimeters; the tenth with
direction North seventy degrees twenty nine point twenty nine minutes
West and a distance of two meters, three centimeters, six millimeters;
the eleventh with direction North twenty five degrees North zero four
point twenty eight minutes East and a distance of one meter, seventy one
centimeters, six millimeters; the twelfth with direction North seventy
one degrees fifty three point forty one minutes West and a distance of
six meters, twenty nine centimeters, six millimeters; the thirteenth
with direction South thirteen degrees forty three point ninety five
minutes West and a distance of sixteen meters, seventy centimeters,
six millimeters; arriving thus to the Southwest corner where the
present description started. The first eight (straight line) sections
border with lands known as Montecristo Isle, property of CORSAIN. The
other five pieces border with lands of Xx. Xxxxxxx Xxxxxxx; the thirteen
prior pieces border with the Ruta Militar Highway with Santa Xxxx xx
Xxxx in the middle. That on the built area of the land that is leased
there is found iron and wood galleys with roofs of channeled,
laminated metal, also property of CORSAIN. II.) OBJECT OF THE CONTRACT.
Both parties agree that for having incurred in past due payments on the
lease, application of clause V) of the original contract was made in such
sense and having paid the past due amount, we agree to sign a new
contract that will be governed under the clauses that are detailed in
this instrument. The representative of the lessor delivers in simple
lease to the lessee the portion of the land described above and in such
capacity the lessee's special Power receives the referred to property to
his complete satisfaction, obliging himself to return it to the lessor in
the same conditions at the termination of the lease term. III) TERM AND
EXTENSION. The term of the lease is agreed to for nineteen months
starting counting from the day of November 12 of the year two thousand
six with expiration on the day of June 11 of the year two thousand eight,
both dates inclusive, which will be extended automatically each three
months, always and when, there does not exis t an express statement on
the part of CORSAIN to terminate it in the established term with at least
thirty days of advance notice. If the Lessee complies with the clauses of
this contract in joint agreement with the Lessor they may decide to
continue with the lease, its conditions will be discussed and protected
under a new
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contract. In the case that the Lessee deoccupies the property under
lease before the end of the term it should pay and all the surface taxes
pending as if it were the end of the term. IV) PRICE AND FORM OF
PAYMENT: The total price of the lease during the first year is EIGHTEEN
THOUSAND SIX HUNDRED EIGHT DOLLARS WITH TWENTY XXX XXXXX XX X XXXXXX XX
XXX XXXXXX XXXXXX OF AMERICA ($18,608.21) PLUS THE CORRESPONDING TAX FOR
THE Transfer of Real Estate and the Rendering of Services (VAT), payable
through monthly quotas, successive and beforehand, the first for ONE
THOUSAND FIVE HUNDRED FIFTY DOLLARS WITH SIXTY EIGHT CENTS OF A DOLLAR OF
THE UNITED STATES OF AMERIC A, ($1,550.68), PLUS THE CORRESPONDING TAX
FOR THE Transfer of Real Estate and the Rendering of Services (VAT).
This price will be increased annually in conformance to the inflation
rate of the United States of America and the increase will begin once
the corresponding report is obtained from the Embassy of that country
accredited in El Salvador and will be added to the corresponding monthly
quota effective on the twenty fifth day of the month of each one of the
months included in the term. V) EFFECTS OF THE PAST DUE: The delay in
payment of one of the quotas agreed to will cause the term to end, giving
the right to the Lessor to require the Lessee the immediate deoccupation
of the leased property, without need for any judicial process and require
him executively to pay the owed taxes as well as those that remain to be
complied with for the original term, including the termination of the
contract as the case may be. VI) DEPOSIT. Both parties agree that the
obligations contrac xxx in the present instrument on the part of the
Lessor are guaranteed with the deposits made by it in favor of the Lessee
for the amount of ELEVEN THOUSAND SEVEN HUNDRED AND FORTY ONE DOLLARS
WITH FIFTY CENTS OF A DOLLAR OF THE UNITED STATE OF AMERICA protected by
income receipt number six thousand seven hundred and seventy four-A,
dated November 15 of one thousand nine hundred ninety three and deposited
to the account of CORSAIN dated February 16, one thousand nine hundred
ninety five for the amount of THREE HUNDRED AND THIRTY THREE DOLLARS
WITH FIFTY CENTS OF A DOLLAR OF THE UNITED STATES OF AMERICA, that will
serve to respond for the owed taxes or for payments which the Lessee
might incur and that were charges of the Lessor and which will be
returned to him in a term of thirty days following the termination of the
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present contract, in case what was mentioned above does not happen. VII)
SPECIAL CONDITIONS: The Lessor commits to: 1) inform in writing to
CORSAIN within thirty day s following the date of this instrument, about
which installations will be used, upon not doing it, he will incur a fine
equivalent to one quarter of the lease price. 2) The Lessor will not be
responsible for the deterioration that these installations suffer and
that are not used by them. 3) Answer for all kinds of damages that may
be caused as a consequence of the operations that are done in the leased
property. 4) The Lessor may make use of the water resources that are
within the leased portion and of the sources known as Santa Francisca,
Adolfo, Quebrada Seca and Quebrada Honda for whose use the corresponding
rights of way for transit and aqueducts will be constituted, it ought to
use these by means of underground piping. In addition the Lessee
authorizes to the Lessor to construct a tank in the source known as
Xxxxxx. It is understood that the access to the sources mentioned and
the use of the water coming from these does not have an exclusive
character for the Lessor; 5) The Lessor will have the right to use the
surface of the leased area to construct, maintain, repair installations,
machinery, materials and residues from the ore that will be brought to be
processed in said place, as well as build roads, trenches, deposits for
minerals, waste and ore, piping for potable water, telephone lines,
electric lines of transmission and distribution. As well, it may build
all the facilities necessary to use what is leased for the end of
crushing, milling and processing of raw material and precious mineral
ore, all on the account of the Lessor. The use of what is leased should
be the most adequate in accordance with the works that the Lessor
proposes to carry out on the property object of this contract and in
whose execution he is obliged to not cause any ecological damages; and 6)
In the case that Corsain decides to sell the property object of the
present contract, it is obliged to give a preferential right to COMMERCE
GROUIP to acquire dominion over it, al ways if the proposed conditions of
sale are accepted, to the contrary, CORSAIN remains free to terminate the
lease contract without anymore responsibility than to give the respective
notice to the
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Lessor. VIII) RIGHTS OF THE LESSEE: The Lessee will have free access to
the leased property for the purpose of inspection, being able to delegate
such faculty to the person or persons it deems convenient, for which it
will give prior notice to the Lessor of the reasons for its decision with
at least two days of anticipation for reasons of security. IX). DESTINY
OF USE. The leased property will be destined exclusively for the use of
the surface of the leased area to construct, maintain, repair
installations, machinery, residues of ore that will be brought to be
processed in said place, as well to build roads, trenches, deposits for
minerals, waste and ore, piping for potable water, telephone lines,
electric transmission and distribution lines; to construct all the
facilities necessary to use what is leased to the end of crushing,
milling and processing raw materials and ore of precious minerals. X).
PROHIBITIONS. A) The Lessee may not exploit any mineral that might exist
on the leased property in virtue of the fact that the present contract
only covers the use of the surface of the land and the use of the
installations for the purpose of processing and storing mineral ore
brought from outside of the same property. If the Lessor finds gold,
silver, or other mineral and plans to exploit it, it should sign a new
contract with the Corporacion Salvadorena de Inversiones different from
what by means of this instrument is being signed; b) The Lessor commits
to not store on the leased property inflammable, explosive substances and
all those that are prohibited by the law or that put the Lessee at risk
or its affiliates and in general any person or asset. In cases where by
the nature of the work carried out by the Lessor it is necessary to use
any of the substances p reviously mentioned, it is responsible
exclusively for the consequences derived from their wrongful use. c) The
Lessor cannot sublease in part or in total nor cede its rights to the
property given in lease without prior written permission from the Lessee.
Any violation of the present prohibitions will be cause for terminating
the present contract. XI) FINES. The fines that are imposed for
infractions to municipal sanitary regulations will be on the account of
the Lessor or any others that are related to the business. XII) SPECIAL
CLAUSE. The Lessee is exonerated from all responsibility when the acts
and transactions that the Lessor carries out are not in conformance to
the laws of the Republic; and indeed it is proven that it is doing them,
will also be cause for termination of the contract, thus ending the
original term and
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any extensions. XIII. LOCAL REPAIRS. During the lease term or its
extensions the Lessor will make: 1) All the expenditures that are
generated by the constru ction and repair of buildings and for the repair
of machinery and equipment will be on the account of the Lessor, 2) Upon
ending the term of the present lease, the improvements and constructions
that the Lessor may have done on the leased property will remain without
any cost, in favor of CORSAIN with the exception of the installations
that are removable, equipment, machinery, spare parts, inventories and
raw material which the Lessor may withdraw always when these are
identified as its property and that with the withdrawal the leased
property not suffer any deterioration. XIV. TERMINATION. The term of the
present contract will end and the Lessee will have the right to declare
it ended without the need for any judicial intervention and the Lessor
should deoccupy immediately the leased property in any of the following
cases: a) For late payment of one of the lease quotas in the form in
which it has been agreed to in this instrument after sixty days of having
been notified of the e xistence of the past due payment; b) For an
executed sentence coming from an execution brought against the Lessor
by third parties or by CORSAIN for obligation distinct from the contents
in this document; c) If the Lessor subleases or cedes its right in the
lease or if it permits access of third parties so that they explore or
exploit the mines without the prior authorization of CORSAIN; d) For
having used the leased property for work that is distinct from those that
in conformance to this contract it plans to carry out; e) For
non-compliance of the obligations contracted according to what is
established in Roman number VII of this contract; f) For non-fulfillment
or contravention on the part of the Lessor of any of the obligations
consigned in this instrument, g) When the Lessor does not comply with
any of the obligations and special conditions stipulated in it, the
Lessee will have the right to retain all or part of the quantity given in
deposit to recover from the damages and harm caused; as well as fulfill
what is established in Clause VII of this contract. XV). SPECIAL
DOMICILE. For the purpose of the obligations contracted in the present
contract, both parties set as special domicile that of this city and to
the competence of whose Tribunals we submit. I SWEAR: I) That the
signatures that appear at the end of the document that today is
recognized are AUTHENTIC for having been recognized as theirs by those
appearing in my presence, as well as the concepts that come up in it; II)
That I have verified the personal identity of those appearing by
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means of the relevant identity documents; c) Being legitimate and
sufficient the juridical personality with which appears on the one hand
Lic. Xxxx Xxxxxxx Xxxxxxxxx Xxxxx for having in view : a) Founding Law of
the Corporacion Salvadorena de Inversiones published in the Official
Daily (Federal Register) Number two hundred thirty five Tome nine
hundred seventy three dated December twenty two of one thousand nine
hundred eighty one in whose article seventy seven the Legal
Representation of the Corporation is conferred to President and it
authorizes him to intervene in the acts and contracts that it signs and
in juridical or administrative actions in which it has interest, b)
Certification of Number DOS of the Act Number ONE HUNDRED XXXXXX FIVE of
the session celebrated by the Assembly of Governors of the Corporacion
Salvadorena de Inversiones the day of May twenty eight of the year two
thousand seven in which it ratifies the naming as its Director President
Lic. XXXX XXXXXXX BETAGLIO XXXXX for a pe riod of three years counting
from June first of the year two thousand four by means of which it
ratifies the naming of XXXX XXXXXXX XXXXXXXXX XXXXX as President
Director of the Corporacion Salvadorena de Inversiones. III) Being
legitimate and sufficient the juridical personality with which appears on
the one hand Xx. Xxxxxx X. Xxxxxxxx for having in view: the General
Administrative Power granted in the city of Milwaukee, State of
Wisconsin, United States of America at sixteen hours of the day of
October twenty six o two thousand seven before the Notary Xxxxxx Xxxxxxxx
by Xxx. Xxxxxxxxx Xxxxxx, in her character of Legal Representative of the
company COMMERCE GROUP CORP and other, duly having Apostille conforming
to the Hague Convention dated October five of one thousand nine hundred
seventy one dated February twenty six of the year two thousand eight,
being in said power making the existence legitimate of the referred to
company and the personality of its expressed leader. Thus did those
present express themselves and to whom I explained the legal effects of
this Notarial Act that is written in six working sheets and read as it
was by me completely all that was written and in one single act without
interruption they state their agreement, ratified its content and we
signed jointly with the translator of the Power of Attorney of the
Lessor who stated he swears having translated to them all the content and
the concept detailed in
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this document, the reason for which both parties
sign for its being written conforming to their will. I SWEAR.
Signatures of Lic. Xxxx Xxxxxxx Xxxxxxxxx Xxxxx; Xxxxxx Xxxxxxxx, Xxxx
X. Xxxxx and the stamp and signature of the Notary.
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