MONMOUTH AGREEMENT THIS AGREEMENT is dated effective the 12th day of June, 2007.
THIS
AGREEMENT is dated effective the 12th
day of
June, 2007.
BETWEEN:
XXXX
XXXXX
(hereinafter
called “Owner”)
-
and
-
XXXXXXXX
URANIUM HOLDINGS, INC. an
Arizona corporation
(hereinafter
called “Xxxxxxxx”)
RECITALS:
A.
Owner
owns certain Claims located in the Province of Ontario, Canada.
X. Xxxxxxxx
wishes to acquire an undivided one hundred (100%) per cent interest in
such
Claims.
C. Owner
is
prepared sell Xxxxxxxx an undivided one hundred (100%) per cent interest
in such
Claims on the terms and conditions hereinafter set forth.
NOW
THEREFORE,
in
consideration of the premises and the mutual obligations hereinafter described,
and intending to be legally bound, the parties agree as follows:
ARTICLE
I
INTERPRETATION
AND DEFINITIONS
Section
1.01 Definitions
As
used
in this Agreement, the following words and phrases have the following meanings:
(a) “Affiliate”
means any person, partnership, limited liability company, joint venture,
corporation, or other form of enterprise which controls, is controlled
by, or is
under common control with a party to this Agreement.
(b) “Agreement”
means this agreement as the term is defined in Section 1.03 hereof.
1
(c) “Force
Majeure” means any event beyond a party's reasonable control including laws
which prohibit a party's ability to comply with its obligations; action
or
inaction of civil or military authority; mining casualty; damage to or
destruction of mine, plant or facility; fire; explosion; flood; insurrection;
riot; labour disputes; and acts of God, but does not include a party's
inability
to make any payments required under this Agreement.
(d) “Claims”
means all mineral rights constituting the claim units marked as such on
Schedule
“A” attached to this Agreement.
(e) “NMR”
means the net mineral royalty reserved by Owner and calculated in accordance
with Schedule “B: hereto.
(f) “Option”
has the meaning given that term by Section 2.01.
(g) “Option
Payments” has the meaning given that term by Section 2.01.
(h) “Option
Period” means the period of time from the execution of this Agreement to the
exercise, abandonment or termination of the Option in accordance with the
terms
and conditions of this Agreement.
Section
1.02 Schedules
The
following schedules are attached to and form part of this Agreement:
(a) Schedule
“A” - List of Claims
(b) Schedule
“B” - Calculation of NMR
Section
1.03 Entire
Agreement
This
agreement and the attached schedules and all properly executed amendments
are
hereinafter collectively referred to as this “Agreement”. This Agreement
constitutes the entire agreement between the parties and supersedes all
previous
agreements and undertakings relating to the subject matter. The parties
acknowledge that there are no agreements, undertakings, representations,
warranties or conditions collateral to this Agreement except as specifically
stated otherwise in this Agreement.
Section
1.04 Caption
and Headlines
The
division of this Agreement into articles and sections and the insertion
of
headings is for convenience of reference only and shall not affect the
interpretation of this Agreement. Any reference to a section or article
shall be
a reference to a section or article of this Agreement unless specifically
stated
otherwise.
Section
1.05 Extended
Meanings
In
this
Agreement, where the context so requires or permits, the masculine gender
shall
include the feminine and neuter genders, the plural shall include the singular
and vice versa, and the words “person” and “persons” shall include corporations,
partnerships, and all other entities of whatever description.
2
Section
1.06 Currency
In
this
Agreement all statements of and references to dollar amounts shall mean
Canadian
dollars.
Section
1.07 Governing
Law
This
Agreement shall be interpreted in accordance with the laws of the Province
of
Ontario, Canada, and the federal laws of Canada as applicable therein.
Section
1.08 Severability
If
any
provision of this Agreement is found invalid, illegal, or incapable of
enforcement by any court of competent jurisdiction, such provision and
the
remaining provisions of the Agreement shall continue to be enforceable
to the
extent permitted by such court against any person(s) and in any circumstance(s)
other than those to whom it has been found invalid, illegal or incapable
of
enforcement.
Section
1.09 Amendments
No
amendments to this Agreement shall be of any force and effect unless executed
in
writing by all the parties to this Agreement.
ARTICLE
II
GRANT
AND EXERCISE OF OPTION
Section
2.01 Option
a)
Owner
hereby agrees to sell Xxxxxxxx and Xxxxxxxx hereby agrees to Purchase (the
“Purchase”) an undivided one hundred (100%) per cent interest in the Claims by
making the following payments (the “Payments”) to Owner:
a) $16,000
will be paid to Owner concurrently with the execution of this Agreement;
and
b) _____
common shares of Xxxxxxxx will be issued to Owner by no later than ____
,2007.
Section
2.02 Completion
of Purchase
a) Owner
grants Xxxxxxxx an exclusive and irrevocable option (“Option”) to acquire an
undivided one hundred (100%) per cent interest in the Claims by making
the
following payments (the “Option Payments”) to the Owner:
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a)
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100,000
common shares of Xxxxxxxx will be issued to Owner by no later
than __
2007:
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b)
|
100,000
common shares of Xxxxxxxx will be issued to Owner by no later
than ___,
2008;
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c)
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$5,000
will be paid to Owner concurrently with the execution of this
Agreement;
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d)
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$15,000
will be paid to Owner by no later than May 14,
2007;
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e)
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$40,000
will be paid to Owner by no later than March 14,
2008;
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f)
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$60,000
will be paid to Owner by no later than March 14, 2009; and
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g)
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$60,000
will be paid to Owner by no later than March 14,
2010.
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Section
2.02 Exercise
of Option
The
Option shall be automatically exercised and the Claims vested in Xxxxxxxx
making
all the Option Payments set forth in Section 2.01. Upon exercise of the
Option
in accordance with that Section, Xxxxxxxx shall have earned and acquired
an
undivided hundred (100%) per cent ownership interest in and to the Claims
free
and clear of any mortgages, liens, charges, pledges, security interest,
encumbrances and any other claims of any description, but subject to a
3% NMR,
determined and paid in accordance Schedule “B” hereto.
b) The
3%
NMR may be partially purchased (the “Buyout”) by Xxxxxxxx at any time (as to 50%
thereof leaving Owner with an NMR equal to 1.5%) by Xxxxxxxx paying to
Owner
$1,500,000. This purchase will not affect any or the NMR that is otherwise
due
to Owener at the date of the Buyout.
Section
2.03 Results
of Prior Exploration Work
Immediately
following the execution of this Agreement, Owner shall deliver to Xxxxxxxx
all
technical data for the Claims in its possession including, but without
limitation, drilling, geophysics and geological information held by Owner.
Should
this Agreement be terminated, for whatever reason, prior to vesting, then
Xxxxxxxx will return and forward to Owner copies of data and information
received from Owner but Xxxxxxxx will not be obliged to return any Claims
data
otherwise acquired by Xxxxxxxx during the Option Period.
Section
2.04 Title
Within
sixty (60) days following the completion of the Purchase pursuant to Section
2.02, Owner will provide Xxxxxxxx with executed transfers of an undivided
hundred (100%) percent interest in the Claims and will provide any additional
assistance required by Xxxxxxxx or its nominee to legally record the transfers.
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES
Section
3.01 Representations
and Warranties bv Owner
Owner
represents and warrants that:
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(a)
|
he
has all requisite power and authority to perform his obligations
under
this Agreement;
|
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(b)
|
all
necessary action has been taken by Owner to execute and allow
the proper
performance of the terms of this Agreement, and this Agreement
constitutes
a valid and binding obligation of Owner enforceable in accordance
with its
terms;
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4
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(c)
|
to
the best of Owner's knowledge the location of each of the Claims
on the
ground conforms to the description appearing on records in the
appropriate
records office, and the Claims were properly located according
to the laws
of Ontario and will be in good standing for at least 180-days
days after
the execution of this Agreement;
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(d)
|
he
has not received notice of any violation of or investigation
relating to
any federal, provincial or local environmental or pollution law,
regulation or ordinance with respect to the Claims;
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(e)
|
to
the best of Owner' s knowledge there are no reclamation liabilities
in
connection with the Claims and, in particular, there are no obligations
to
monitor or clean up any preexisting mine sites or mine waste
dumps or
tailings;
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(f)
|
his
interest in the Claims is free and clear of any mortgages, liens,
charges,
pledges, security interests, encumbrances or other claims of
any
description and, upon completion of the Purchase by Xxxxxxxx,
Xxxxxxxx
will acquire an undivided one hundred (100%) interest in the
Claims free
and clear of any mortgages, liens, charges, pledges, security
interests,
encumbrances or other claims of any description; except for the
NMR set
our in Section 2.02 and Schedule “B” of this
Agreement;
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(g)
|
no
person or other entity has any right or agreement, option, understanding,
prior commitment or privilege capable of becoming an agreement
for the
purchase or acquisition from Owner of any interest in the Claims;
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(h)
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all
assessment work required to maintain the Claims in full force
and effect
has been performed as of the execution of this Agreement; and
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(i)
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there
are no royalties or other latent interests in the Claims owing
to any
parties, except as outlined in Section 2.02 and Schedule
“B.”
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Section
3.02 Survival
Owner
acknowledges that Xxxxxxxx is relying on the representations and warranties
contained in Section 3.01 in entering into this Agreement and that such
representations and warranties are continuing and survive the execution
of this
Agreement.
Section
3.03 Representations
and Warranties bv Xxxxxxxx
Xxxxxxxx
represents and warrants that:
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(a)
|
it
has been duly incorporated and is a validly subsisting corporation
under
the laws of the State of Nevada and has all corporate power and
authority
to perform its obligations under this Agreement; and
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(b)
|
all
necessary corporate action has been taken by Xxxxxxxx to authorize
the
execution, delivery and performance of this Agreement, and this
Agreement
constitutes a valid and binding obligation of Xxxxxxxx enforceable
in
accordance with its terms.
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5
Section
3.04 Indemnitv
Each
party will indemnify and save the other party and its directors, officers,
employees, agents, representatives, subcontractors and Affiliates harmless
from
all losses, damages, costs, actions, and suits arising out of or in connection
with any breach by that party of any representation, warranty, covenant or
agreement contained in this Agreement. This indemnity shall survive the
termination of this Agreement.
ARTICLE
IV
EXPLORATION
AND DEVELOPMENT ACTIVITIES
Section
4.01 Right
to Explore and Develop
Owner
grants to Xxxxxxxx, its employees, directors, officers, agents, representatives
and contractors, the exclusive right to enter upon the property comprising
the
Claims for the purpose of exploration, development, mining and such other
operations as Xxxxxxxx considers necessary during the Purchase Period, the
nature, manner and extent of which operations will be in Xxxxxxxx’x sole
discretion.
Section
4.02 Conduct
of
Exploration and
Development Work
Xxxxxxxx
shall perform its exploration and development work on the Property comprising
the Claims in accordance with good mining practice and shall comply with
all
applicable laws and regulations.
Section
4.03 Installation
of Equipment
Xxxxxxxx
may install, maintain, replace and remove any and all mining machinery,
equipment, tools, and facilities which it may desire to use in connection
with
its exploration and development activities on the property comprising the
Claims. Upon termination of this Agreement for any reason, Xxxxxxxx shall
within
a period of six (6) months following such termination remove its equipment
at
its sole cost and expense from the Claims, having Owner’s permission to enter
onto the property comprising the Claims for such purpose.
ARTICLE
V
XXXXXXXX’X
OBLIGATIONS
Section
5.01 Reporting
By
no
later than each anniversary of this Agreement, Xxxxxxxx shall provide a copy
of
any geological report that has been prepared respecting exploration conducted
on
the Claims in the previous year.
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ARTICLE
VI
ASSIGNMENTS
Section
6.01 Assignments
Xxxxxxxx
shall be entitled to assign its rights and obligations under this Agreement
without the prior written consent of Owner.
ARTICLE
VII
TERMINATION
Section
7.01 Xxxxxxxx’x
Right to Terminate
Xxxxxxxx
shall have the right to terminate this Agreement and its interest in the
Claims
at any time during the Option Period upon written notice to the Owner thirty
(30) days prior to the contemplated termination date.
Section
7.02 Termination
for Default
If
at any
time during the Purchase Period, Xxxxxxxx fails to duly payor cure any default
in the performance of any obligation of this Agreement within a period of
thirty
(30) days after receipt of a default notice from Owner, Owner may terminate
the
Option. Exercise of such right by Owner shall be without prejudice to any
other
rights or remedies Owner may have at law or in equity as a result of such
default of this Agreement by Xxxxxxxx.
ARTICLE
VIII
FORCE
MAJEURE
Section
8.01 Suspension
of Obligation
If
Xxxxxxxx is prevented by Force Majeure from timely performance of any of
its
obligations under this Agreement (other than the payment of any of the Purchase
Payments), such failure shall be excused and the period for performance and
the
Purchase Period shall be extended for an additional period of time equal
to the
duration of such Force Majeure. Upon the occurrence and upon the termination
of
a Force Majeure, Xxxxxxxx shall promptly notify Owner in writing. Xxxxxxxx
shall
use reasonable efforts to remedy any Force Majeure, but shall not hereunder
be
obligated to contest the validity of any law or regulation, nor any action
or
inaction of any civil or military authority.
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ARTICLE
IX
MISCELLANEOUS
Section
9.01 Notices
Any
notice under this Agreement will be given in writing, by delivery in person
to a
named representative or by mail or facsimile, properly addressed to each
party.
A notice given will be deemed given only when received by the party to whom
such
notice is directed; except that any notice given by facsimile properly addressed
to the party, to whom given, shall be deemed given to and received by the
party,
to whom directed, 48 hours after such notice is successfully faxed or ten
days
after it is mailed, provided there is no postal disruption at the time. Each
party’s address will be the following until such party specifies another address
by written notice:
To
Owner:
2060014
ONTARIO LTD.
0000
Xxxxxxxxxx Xxxx Xxxxx
Xxxxxxx,
Xxxxxxx, Xxxxxx
X0X
0X0
Tel.:
Facsimile:
Attention:
To
Xxxxxxxx:
XXXXXXXX
URANIUM HOLDINGS, INC.
0000
Xxxx
Xxx Xx Xxxxxxx, Xxxxx X000,
Xxxxxxxxxx,
XX 00000
Tel:
TOLL
FREE 000-000-0000
Local
000-000-0000
FAX
000-000-0000
Attention:
Xxxxxx XxXxxxxx
Section
9.02 Area
of Influence
Owner
agrees that there shall be an area of influence (the “Area of Influence”)
respecting any additional claims staked or recorded by Owner which are
contiguous to the Claims and any such claims will fall under the terms of
this
Agreement. In the event that Xxxxxxxx acquires addit9ional claims within
the
Area of Influence from Owner pursuant to this Section, Xxxxxxxx agrees to
pay
Owner $100.00 per additional claim unit so acquired.
Section
9.03 Relationship
of Parties
This
Agreement is not intended to create any partnership or agency relationship
between the parties or fiduciary obligations of any description, and this
Agreement shall not be construed so as to render the parties liable as partners
or as creating a partnership, and no party shall be or shall be deemed to
be, or
shall hold itself out to be an agent of any other party.
8
Section
9.04 Successors
and Assigns
This
Agreement shall be binding upon and inure to the benefit of the respective
successors and permitted assigns of the parties.
Section
9.05 Regulatory
Approval
This
Agreement and the obligations of Xxxxxxxx hereunder are subject to regulatory
approval, as applicable.
Section
9.06 Prior
Agreements
The
Agreement contains the entire agreement and understanding of the parties
and
replaces all prior agreements bearing on the subject matter hereof.
Section
9.07 Counterparts
This
Agreement may be executed in counterparts, all of which taken together shall
constitute one and the same instrument and any of the parties hereto may
execute
this Agreement by signing any such counterpart.
9
IN
WITNESS WHEREOF the
parties make this Agreement effective as of the date first above written.
| XXXX XXXXX | ||||
| Per: | /s/ Xxxx Xxxxx | |||
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| XXXXXXXX URANIUM HOLDINGS, INC. | ||||
| Per: | /s/ Xxx XxXxxxxx | |||
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SCHEDULE
A
to
List
of Claims
Mining
Claims Representing 29 units (District of Mining Division, Monmouth Township,
Ontario, Canada)
944
(4
units) — lot
5 con 7 and lot 6 con 7
945
(1
unit) — lot 7 con 7 (South ½)
946
(2
units) – lot 8 con
7
947
(8
units) – lots 5, 6, 7, and 8 con 6
948
(12
units) – lots 3, 5, 5, 6,7 and 8 con 5
949
(12
units) – lots 3, 4, 4, 6, 7 and 8 con 4
i
SCHEDULE
B
To
Net
Mineral Royalty
Definitions
Where
used herein:
|
(a)
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“Agreement”
means the agreement to which this schedule is
attached.
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(b)
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“Claims”
means those mineral claims set forth in Schedule “B” to the
Agreement.
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(c)
|
“Fiscal
Period” means a three month period ending on the last day of March, June,
September and December of each calendar
year.
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(d)
|
“Net
Mineral Royalty” or “NMR” means the Revenue received by Xxxxxxxx from the
sale of Product from mining operations on the
Claims.
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(e)
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“Ore”
means any material containing a mineral or minerals of commercial
economic
value mined from the Claims.
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(f)
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“Product”
means Ore mined from the Claims and any concentrates or other materials
or
products derived therefrom; provided that if any such Ore, concentrates
or
other materials or products are further treated as part of the mining
operation in respect of the Claims, such Ore, concentrates or other
materials or products shall not be considered to be “Product” until after
they have been so treated.
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(g)
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“Revenue”
means gross revenues during each Fiscal Period received by the Royalty
Payer from the sale of Product by the Royalty Payer to the smelter,
refiner or other purchaser, plus any bonuses and subsidies less all
penalties, umpire assaying, assaying, sampling charges, and insurance
costs, whether deducted by such purchaser or otherwise paid or incurred
by
Royalty Payer. Where revenue otherwise to be included under this
subsection is received by Royalty Payer in a transaction with a party
with
whom it is not dealing at arm’s length, the revenue to be included shall
be based on the fair market value under the circumstances and at
the time
of the transaction.
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(h)
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“Royalty
Interest” means the NMR payable to Royalty Holder pursuant to the
Agreement.
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(i)
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“Royalty
Holder” means “Owner, as defined in the Agreement, his heirs, executors
and assigns.
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(j)
|
“Royalty
Payer” means “Xxxxxxxx”, as defined in the
Agreement.
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Capitalized
terms which are not specifically defined in this Schedule shall have the meaning
given to them in the Agreement.
2. Net
Mineral Royalty
For
each
Fiscal Period, Royalty Payer shall pay Royalty Holder the Royalty Interest
specified by the Agreement, calculated and paid in accordance with the
Schedule.
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3.
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Calculation
of Net Mineral Royalty
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The
NMR
shall be computed at the end of each Fiscal Quarter. On or before the last
day
of the first month following each Fiscal Quarter, a statement shall be furnished
setting forth in reasonable detail the computation of the NMR for the previous
Fiscal Quarter and the Royalty Interest due to the Royalty Holder, if any.
Payment for the Royalty Interest due, if any, shall be enclosed with such
statement.
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4.
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Audit
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The
Royalty Holder, upon written notice to the Royalty Payer shall have the right
to
have an independent firm of chartered accountants audit the records that related
to the calculation of the Royalty Interest with twenty-for (24) months after
receipt of each payment described in this Schedule.
The
Royalty Holder shall be deemed to have waived any right it may have had to
object to a payment made for any calendar year unless it provides notice in
writing of such an objection within twenty four (24) months after receipt of
each payment. If the parties are unable to resolve any such dispute with sixty
(60) days after receipt of such notice, the dispute shall be resolved by
arbitration.
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5
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Commingling
of ore
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Before
any Products from the Claims are commingled with ores and minerals from other
properties, the Products from the Claims shall be measured and sampled in
accordance with sound mining and metallurgical practices for moisture, metal,
commercial minerals and other appropriate content. Representative samples of
the
Products shall be retained by the Royalty Payer and assays (including penalty
substances) and other appropriate analyses of these samples shall be made before
commingling to determine metal, commercial minerals and other appropriate
content. Detailed records shall be kept by Royalty Payer showing measures,
moisture, assays of metal, commercial and other appropriate content and penalty
substances, and gross metal content of the Products. From this information,
Royalty Payer shall determine the amount payable to Royalty Holder from Products
from the Claims commingled with ores and minerals from other
properties.
iii
