EXHIBIT 10.1
MINING LEASE
NEW JERSEY MINE AND VICINITY
THIS MINING LEASE, dated as of October 18, 1993, is between GOLD RUN
GULCH MINING COMPANY ("Lessor"), and MINE SYSTEMS DESIGN, INC.
("Lessee").
RECITALS
A. Lessor owns certain real property more particularly described in
Exhibit A attached hereto and made a part hereof.
B. For the purpose of this Lease, the real property described in Exhibit
A, including the surface and subsurface thereof, all mines, ores, metals,
mineral rights and minerals thereon and thereunder, all veins, lodes,
extralateral rights and mineral deposits now owned or hereafter acquired by
Lessor extending from or onto or contained in said claims, properties and land;
and all water and water rights therein, thereon or thereunder, are herein
called the "Leased Premises." The parties agree that all timber shall be
specifically excluded from this Lease except such timber as should be required
for developing and mining ores and metals on the Leased Premises.
X. Xxxxxx and Lessee desire to enter into a mining lease covering the
Leased Premises.
AGREEMENT
IN CONSIDERATION of the sum of $10.00 and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
and the promises and covenants contained herein, the parties agree as follows:
1. GRANT. Lessor hereby grants, demises, leases and lets exclusively
unto Lessee, its successors or assigns, the Leased Premises, including all
flumes, ditches, easements, licenses, rights-of-way and other rights,
heretofore reserved or granted in, upon or pertaining to the Leased Premises,
together with all building and improvements heretofore used in connection with
exploration for minerals, mining or milling, mining and milling machinery and
equipment and personal property used in connection with mining, milling or
exploration for minerals, situated on the Leased Premises, and now belonging to
Lessor, for the purpose of exploring for, developing, mining (by any method
including but not limited to in situ leaching, open pit and (strip mining),
treating, extracting, milling, storing, shipping, removing and marketing
therefrom all minerals, both metallic and nonmetallic, of every nature and
kind, both known and unknown, excepting only sand, gravel, mine waste rock,
oil, gas and other liquid or gaseous hydrocarbons (herein called "Leased
Substances"). It is the purpose and intent of Lessor to lease, and Lessor
does hereby lease, all of the lands or interest in lands owned by Lessor which
adjoin the Leased Premises described above or which lie in the section or
sections described in any location notices of patents for the claims included
in the Leased Premises. Lessee, its successors or assigns, is further granted
the exclusive right, insofar as Lessor lawfully may grant the right, to divert
streams, to construct storage ponds, to remove lateral and subjacent supports,
to cave, subside or consume the surface or any part thereof, to deposit earth,
rocks, tailings, waste, lean ore and materials on any part of the Leased
Premises, to xxxxx the same, to construct, replace, maintain and remove all
works, buildings, plants, structures, roads, communication and electrical
systems, residences and offices as may be necessary or convenient in the
exercise of Lessee's rights and privileges granted herein, and to commit waste
to the extent necessary, usual or customary in carrying out any or all of the
above rights, privileges and purposes.
2. TERM. This Lease is granted for a term ending fifteen (15) years from
the date hereof and as long thereafter as Leased Substances are mined,
processed or marketed from the Leased Premises on a continuous basis or unless
sooner terminated under any of the provisions herein. For this purpose mining,
processing or marketing operations shall be deemed continuous so long as all of
said operations continue for a minimum of 24 months out of any 60-month period.
3. ADVANCE ROYALTY. Lessee has this day paid to Lessor the sum of $2,400
(the "Advance Royalty Payment"), in the form of a draft payable to the order of
Lessor as an advance against production royalties which may hereafter become
due during the term hereof. Annually hereafter, Lessee, on or before the
anniversary date of this Lease, shall pay or tender to Lessor an Advance
Royalty Payment of $2,400 for that part of the Leased Premises which Lessee
elects to hold hereunder. All Advance Royalty Payments shall be cumulative in
nature, and Lessee shall be entitled to take credit for each such payment
against the Production Royalty payable to Lessor hereunder.
4. PRODUCTION ROYALTY. Lessor hereby reserves and Lessee shall pay as a
production royalty 5% of the Net Smelter Return of all ores or concentrates of
Leased Substances mined and shipped from the Leased Premises (the "Production
Royalty"). In addition to the production royalty of 5% of the Net Smelter
Return, Lessee shall pay a production royalty based on the portion of the Net
Smelter Return which is due to the value of gold as follows:
Price of Gold Additional Production Royalty
Less than $400/xxxx ounce None
$400 to $450 1%
>$450 to $500 2%
>$500 to $550 3%
>$550 to $600 4%
>$600 5%
The price of gold to be used to calculate the additional production royalty is
the price received by the Lessee and as adjusted for inflation by the Consumer
Price Index to the December 1988 level. As used herein, "Net Smelter Return"
means the amount paid by any smelter or other ore purchaser for ores or
concentrates sold less actual costs of transportation and other costs in the
course of handling, assumed by or charged to Lessee (including freight,
insurance and tax) in making shipments from the Leased Premises or Lessee's
mill to the smelter or other purchaser, less all charges for refining,
sampling, assaying, and penalties, less all royalties or overriding royalties
burdening the Leased Premises that exist on the date of this Lease or are
created by Lessor after the date hereof, and less gross production, severance,
general property and other taxes attributable to production from the Leased
Premises.
The Production Royalty shall be accounted for and paid monthly to Lessor within
30 days after the end of each calendar month within which the Leased Substances
are sold. All payments shall be accompanied by a statement explaining the
manner in which payment was calculated. No royalty shall be due or payable on
any Leased Substances stockpiled on the Leased Premises until the sale or
disposition thereof. Within 90 days after receiving the above-described
statement of account, Lessor shall give notice of any objections to the
statement, for any reason, touching upon its accuracy or inaccuracy, by mailing
such objections to Lessee as provided in Section 24 below; and in default
thereof, any inaccuracies in such statement shall be deemed waived by Lessor.
4. TITLE TO LEASED PREMISES. This Lease is executed and delivered
expressly without warranty of any nature whatsoever on the part of Lessor,
either expressed or implied, not even to the return of the consideration paid
herefor. If Lessor owns less interest than the entire fee mineral estate, the
Advance Royalty and Production Royalty to be paid Lessor may be reduced
proportionately.
6. OBLIGATION TO PERFORM ASSESSMENT WORK. Lessee shall perform all
assessment work required to maintain the unpatented mining claims that comprise
the Leased Premises and shall record affidavits of such performance on behalf
of Lessor as required or permitted. Lessee shall not be liable for loss of any
or all of the Leased Premises for failure to perform assessment work, provided
Lessee has performed work in a timely manner which it
reasonably and in good faith, in accordance with generally accepted principles
of the mining industry, believed was sufficient to satisfy such work
requirements.
7. INSPECTION OF PROPERTY. Lessor, or its authorized agents or
representatives, shall have the right to enter in or upon the Leased Premises
during the regular business hours of Lessee for the purpose of inspection, but
shall enter at their own risk and shall not unreasonably interfere with
Lessee's operations.
8. CONDUCT OF OPERATIONS.
8.1 Use of Leased Premises. Lessee may use only so much of the surface
of the Leased Premises as shall be reasonably necessary for the exploration
for, development and mining of Leased Substances contemplated in this Lease.
Lessee recognizes the surface of the Leased Premises has many uses, including
mining, exploration, timber cultivation and production, and other activities.
Lessor expressly reserves the right to use and manage the Leased Premises for
all uses except exploration for, development and mining of Leased Substances as
provided herein, provided Lessor shall not conduct or permit others to conduct
any activities on the Leased Premises which unreasonably interfere with
Lessee's rights hereunder. Lessee shall, wherever practicable, minimize
interference to Lessor's activities as a result of Lessee's activities.
8.2 Use of Roads. Lessee shall have the right to use Lessor's existing
road networks, whether currently existing or subsequently constructed, as are
necessary to its exercise of the rights conveyed hereunder. The foregoing
grant of rights is subject to any restriction or prohibition contained in any
easements, permits, or licenses granting Lessor the right to utilize such
roadways, including but not limited to absolute prohibitions against
assignment, if any, hauling fees, traffic regulations, maintenance costs,
construction costs, or other restrictions. Lessee in its use of roads, whether
currently existing or hereafter constructed by either party, shall comply with
all reasonable regulations promulgated by Lessor. Nothing contained herein
shall prohibit Lessor from modifying or terminating any easement, license, or
permit granting Lessor a right to use any road.
8.3 Damage to Premises and Reclamation. Lessee shall be liable to
Lessor for damage to the Leased Premises (including any improvements, crops or
livestock) caused by Lessee's exercise of its rights under this Lease. Lessee
shall pay Lessor for said damage or, at Lessor's election, repair the damage.
Disturbances of the surface of the Leased Premises normally incident to
Lessee's activities which do not damage improvements, timber or other crops or
livestock shall not be considered as damage to the Leased Premises. Lessee
shall notify Lessor, in advance of its operations and activities hereunder and
the location thereof which shall or may require the removal of timber and
from the Leased Premises, and in the event that the operations of Lessee
hereunder, in fact, result in the removal of timber from any portion of the
Leased Premises, Lessee shall cause all merchantable timber so removed to be
decked along a road on the Leased Premises from where it can be removed by
Lessor without expense to Lessor. The determination of merchantability of any
timber removed shall be governed by the standards then generally in effect in
the wood products industry in the area where the Leased Premises are located.
All merchantable timber shall be harvested in accordance with Lessor's
specifications. Upon delivery of such merchantable timber to a pickup point on
the Leased Premises, Lessee shall not be further liable to Lessor as a result
of the cutting and removal of the merchantable timber. Nonmerchantable timber
shall be considered a crop and damage thereto treated in the manner provided
for in this Section.
9. INSPECTION OF ACCOUNTS AND RECORDS. Lessee shall keep accurate,
clear and legible books of accounts and records pertaining to its operations
hereunder, and Lessor shall have the right, either personally or through its
representatives, and at its expense, to examine and inspect the books and
records of Lessee pertaining to the exploration, mining, milling and shipping
operations of Lessee on the Leased Premises. Any information acquired by
Lessor or its representatives from any such inspection shall be treated as
confidential.
10. TECHNICAL DATA. Lessee shall furnish Lessor, on an annual basis,
with copies of all technical data pertaining to its operations hereunder,
including but not limited to all geological, geophysical, geochemical, mapping,
drilling, sampling, assay, and other data or information pertaining to Lessee's
operations hereunder. Such data shall be treated as confidential.
Notwithstanding the foregoing, Lessee shall not be obligated to disclose to
Lessor any interpretive data or information.
11. CONTROL OF MINING. Lessor's sole right with respect to its
Production Royalty shall be to receive the Production Royalty for Leased
Substances, if any, from the Leased Premises. Lessee shall have full
discretion in the exploration, development and operation of the Leased Premises
and shall in no event be obliged to explore for, develop, drill, mine, mill or
concentrate Leased Substances.
12. LESSER INTEREST. If Lessor owns less than the entire undivided
interest in the Leased Substances, or in any tract included in the Leased
Premises, then the Advance Royalty and Production Royalty shall be due Lessor
only in the proportion that its interest bears to the whole undivided fee
interest. Any interest in the Leased Premises and/or Leased Substances
hereafter acquired by Lessor shall be automatically subject to this Lease. If
any such acquisition changes Lessor's interest in the Leased Premises or Leased
Substances, an appropriate adjustment will be made after Lessee receives
written notice thereof from Lessor.
13. INDEMNITY. Lessee shall assume all liability in connection with its
operations on the Leased Premises and shall hold Lessor harmless from any and
all liability which may arise out of Lessee's development and operation of the
Leased Premises. Lessee shall use its best efforts to ensure that the work
performed by Lessee hereunder shall be in compliance with applicable
environmental, safety and health requirements of federal, state and local
governments. Upon the termination of this Lease, Lessee shall return the
Leased Premises to Lessor free and clear of liens for labor done or work
performed upon the Leased Premises or materials furnished to it for the
exploration, development or operation thereof under the Lease, but Lessee shall
have the right to dispute or contest the validity of such liens. Lessee's
liability under this Section shall terminate upon termination of this Lease
except for obligations incurred before the date of termination.
14. CROSS-MINING; OPERATIONS ON OTHER LANDS. Lessee shall have the
right to use any roads, tunnels, shafts, pits, inclines and workings upon the
Leased Premises for the purpose of transporting Leased Substances, water,
slurries and waste materials from adjoining or nearby properties. For the
purpose of enabling Lessee to conduct, to Lessee's best advantage and with
operations, the operations of Lessee and the operations on such other lands may
be conducted upon the Leased Premises and upon such other lands as a single
mining operation, to the same extent as if all such properties
constituted a single tract of land. Leased Substances from the Leased Premises
may be commingled with ores and minerals from such other lands, provided that
nothing herein shall relieve Lessee from its obligation for payment of the
Production Royalty. In the event of and prior to such commingling, Lessee
shall weigh, sample and assay the Leased Substances mined
from the Leased Premises before they are commingled so as to allow allocation
of the resulting concentrate to the respective properties from which derived.
All such weighing, sampling, assaying and allocation shall be performed in
accordance with good mining practices prevailing at the time. Lessee shall
have the right to use so much of the surface and subsurface of the Leased
Premises as is required for ingress and egress, conducting exploration and
mining operations, stockpiling of Leased Substances and disposing of wastes
both on the Leased Premises and on lands upon which Lessee or affiliated
parties may be conducting mining operations; Lessee shall also have the right
to use so much of such surface and subsurface of the Leased Premises as may be
required for utility lines, camps, roads, drillsites, xxxxx piles, tailings
disposal sites, dumps, xxxxx, smelters and other structures or facilities
required in its exploration, development mining and milling activities. Lessee
shall have the right to use, develop and store water on the Leased Premises for
use in its development, mining and milling activities. Further,
Lessee may use the Leased Premises for the mining, removal, treatment and
transportation of minerals and materials from adjoining or nearby property, or
for any mining or milling purpose connected therewith. Mining operations on
adjacent properties shall be deemed mining operations on the Leased Premises
for the purposes of Section 2 hereof.
15. TREATMENT; TAILINGS. Lessee shall have the right, but shall not be
required, to beneficiate, concentrate, smelt, refine, xxxxx and otherwise
treat, in any manner, either wholly or in part at a plant or plants on the
Leased Premises or on other lands, any Leased Substances or other materials
mined or produced from the Leased Premises and from other lands. Such treatment
shall be conducted in a careful and workmanlike manner. The tailings and
residue from such treatment shall be deemed waste and may be deposited on the
Leased Premises or on other lands. Lessor shall have no right, title or
interest in any such tailings or residue remaining on the Leased Premises for a
period of one year after the date on which this Lease has expired, or has been
terminated by Lessee as to all of the Leased Premises. Any tailings or residue
remaining after said date shall be deemed abandoned by Lessee and thereupon
shall become the property of Lessor.
16. TAXES. During the time this Lease is in effect, Lessee shall pay,
before delinquent, all general property taxes which may be assessed against the
Leased Premises, including the Leased Substances covered by this Lease, and
Lessee shall be entitled to deduct such amounts from Production Royalty
payments to Lessor as set forth in Section 4. Lessee shall also pay, before
delinquent, all taxes levied and assessed against any improvements placed
by it upon the Leased Premises. Lessee shall not be required to pay any income
or other taxes imposed on Lessor by reason of the receipt of any amounts to be
paid Lessor under this Lease.
17. AREA OF MUTUAL INTEREST. If, during the term of this Lease, Lessor
or Lessor's representative or agent shall locate or acquire any interest in any
mining claim or property contiguous with or proximate to any of the property
described on Exhibit A, all such claims and property shall be subject to this
Lease, without any additional consideration therefor payable to Lessor, and
all references in this Lease to the Leased Premises shall be deemed to include
all such claims and property. Lessor agrees to notify Lessee promptly upon the
location of each such claim or acquisition of property. Lessee and Lessor
agree to execute and acknowledge an amendment to this Lease to include and
describe each such claim or property and to file such amendment for recording
in the real property records of the county where said claim or property is
located.
18. FORCE MAJEURE. Lessee shall not be liable or in default under any
provisions of this Lease for failure to perform any of its obligations
hereunder during periods in which performance is prevented by any cause
reasonably beyond Lessee's control, which causes hereinafter are called "force
majeure." For the purposes of this Lease, the term "force majeure" shall
include, but not be limited to, fires, floods, windstorms and other damage from
the elements; strikes, war, insurrection, mob violence and riots;
unavailability of materials, labor and transportation; lack of a reasonable
market for Leased Substances mined from the Leased Premises; unavailability of
smelting or refining facilities; interference, action, legislation or
regulation by governmental or military authority, including a requirement by
such authority that an environmental impact statement, plan of operation or
similar statement or document be prepared or approved; litigation; and acts of
God or acts of the public enemy. The duration of this Lease and of the time
for completion of performance by Lessee of its rights and obligations hereunder
shall be extended for a period equal to the period of disability as a result of
the event of force majeure, provided Lessee gives Lessor written notice of the
existence of the event of force majeure. All periods of force majeure shall be
deemed to begin at the time Lessee stops performance hereunder by reason of
force majeure. Notwithstanding the foregoing, the parties understand that an
event of force majeure shall not excuse any obligation to make a payment of
money required by this Lease.
19. FIRST RIGHT OF REFUSAL. If, at any time during the term of this
Lease, Lessor shall, in response to a bona fide offer to purchase all or part
of its interest in the Leased Premises from a third party, desire to sell or
otherwise dispose of such interest, it shall notify Lessee in writing of the
party to whom it desires to sell such interest and the price at which and
the terms upon which it desires to sell the same, and Lessee shall, within 30
days of receipt of the notice, notify Lessor in writing whether it wishes to
purchase such interest at the price and on the terms set forth in the notice.
If Lessee elects to purchase such interest, Lessor shall be bound to convey,
assign, or otherwise transfer such interest to Lessee promptly thereafter at
such price and on such terms. If Lessee elects not to purchase such interest
or fails to give notice of its intention within the 30-day period, Lessor shall
be free to convey, assign, or otherwise transfer such interest to the third
party at a price not less than stated in the notice or on more favorable terms
than those stated in the notice. Any conveyance by Lessor to a third party
shall be subject to the terms of this Lease. If Lessor shall not have so
disposed of such interest to said third party within 90 days after receipt of
notice that Lessee elects not to exercise its right of first refusal or after
expiration of that party's 30-day period within which to give notice, the
provisions of this Section shall again apply to the disposition by Lessor of
any such interest.
20. ASSIGNMENT. Subject to the provisions of Section 19 above, the
rights of either party hereunder may be assigned in whole or in part and the
provisions hereof shall extend to their successors and assigns, but no change
or division in ownership of the Leased Premises, Advance Royalty or Production
Royalty, however accomplished, shall operate to enlarge the obligations or
diminish the rights of either party under this Lease and neither Lessee nor its
successors or assigns shall ever be required to make payments or to render
reports or notices to more than one party. In the event Lessor's interest in
the Leased Premises is now or hereafter owned by more than one party, Lessee
may withhold further payments until all such owners have designated a single
party to act for all of them hereunder in all respects, including but not
limited to the giving and receiving of all notices and the receipt of all
payments and reports. No such change or division in the ownership of the
Leased Premises, Advance Royalty or Production Royalty shall be binding upon
Lessee for any purpose until such person acquiring any interest has further
furnished Lessee with the instrument or instruments, or certified copies
thereof, constituting his claim of title from the original Lessor. Lessee
shall have the right to subcontract with others for the performance of
exploration, development and mining work hereunder, subject to all of the terms
of this Lease, but no such subcontract shall relieve Lessee of its obligations
to Lessor hereunder.
21. TERMINATION OF LEASE.
20.1 By Lessor. If Lessee fails to keep and perform all of the terms
and conditions of this Lease on its part to be kept and performed, then Lessor
may notify Lessee of the default in writing specifying the default. If within
ten days after Lessee's receipt of such notice, in case of default arising
through failure to account for royalties, or to make the monthly or annual
payments herein mentioned, and within 30 days in the case of any other default,
Lessee shall make such royalty or other payments, or commence and diligently
thereafter proceed to correct such other default, this Lease shall
continue in good standing. However, upon failure of Lessee to make such
royalty or other payment within ten days or to commence within 30 days to cure
any other default and diligently thereafter proceed to correct the same, Lessor
may then, by written notice or demand, forthwith terminate this Lease and fully
repossess itself of the Leased Premises, and without prejudice to any other
rights which might otherwise accrue to Lessor for the violation of the terms
hereof. After such default and termination of this Lease, Lessee shall have no
further rights in or right to the possession of the Leased
Premises or any part thereof, except for the purpose of accomplishing the
removal of its machinery and equipment as set forth below in Section 22.
21.2 By Lessee. Lessee may terminate this Lease in whole or in part at
any time and from time to time upon written notice delivered to Lessor which
termination shall take effect upon any future date set forth in the notice, or,
if no date is specified, upon the date of delivery of the notice with respect
to that part of the Leased Premises specified in the notice. Upon such
termination, all right, title and interest of Lessee under this Lease as to
that portion of the Leased Premises specified in the notice shall terminate,
and Lessee shall not be required to make any further payments, or to perform
any further obligations hereunder as to said portion of the Leased Premises,
except payments or obligations which then have accrued under the express
provisions of this Lease and which have not been paid or performed.
21. REMOVAL OF EQUIPMENT. Lessee shall have the right, at any time
within one year after the termination or expiration of this Lease, to remove
all property, fixtures, structures, machinery or equipment erected or placed by
Lessee on or in the Leased Premises. Lessor shall have the right to require
Lessee to remove any or all such property, fixtures, structures, machinery or
equipment within one year after the termination or expiration hereof.
23. RECORDING OF SHORT-FORM NOTICE. The parties hereby agree to execute
a short-form counterpart of this Lease contemporaneous herewith for the sole
purpose of recordation in the real property records sufficient to give record
notice, pursuant to the laws of the state where the Leased Premises are located
of the existence of this Lease. This Lease shall not be recorded without the
written consent of Lessee.
24. NOTICES. Any notice required or permitted to be given hereunder
shall be in writing and shall be delivered in person or sent by registered or
certified mail, return receipt requested. Notices so mailed shall be deemed
effective on the third business day after mailing. Until change of address is
communicated, all notices shall be addressed to:
Lessor: Gold Run Gulch Mining Company
Xxx 000
Xxxxxxx, Xxxxx 00000
Lessee: Mine Systems Design, Inc.
HC01 Xxx 000
Xxxxxxx, Xxxxx 00000
25. GENERAL.
25.1 Modification. The parties hereto by mutual written agreement may,
at any time and from time to time, amend this Lease and any of the terms
hereof.
25.2 Further Documents. The parties hereto further agree to execute
all such further documents and do all such further things as may be necessary
25.3 Entire Agreement. This is the entire agreement between the
parties and no modification shall be effective unless in writing and executed
by the parties hereto.
25.4 Law. The terms and provisions of this Lease shall be interpreted
in accordance with the laws of the state where the Leased Premises are
located.
IN WITNESS WHEREOF, this instrument is executed as of the date above
written.
LESSOR: LESSEE:
GOLD RUN GULCH MINING COMPANY MINE SYSTEMS DESIGN, INC.
By: /s/ X. Xxxxxxxx By:/s/ Xxxx X. Xxxxxxxxxxx
----------------------- ---------------------
Title: President Title: President
----------------------- --------------------
STATE OF IDAHO )
) ss.
COUNTY OF SHOSHONE )
On this 27th day of September, 1993, before me, the undersigned, a
Notary Public in and for the State of Idaho, personally appeared Xxxx X.
Xxxxxxxxxxx, known to me and to me known to be the President of MINE SYSTEMS
DESIGN, INC., a corporation whose name is subscribed to the foregoing
instrument and acknowledged to me that said officer executed the same.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my notarial
seal the day in this certificate first above written.
/s/ Xxxxxx X. Xxxxxx
Notary Public for the State of Idaho
Residing at Kellogg, Idaho
My commission expires: 1/18/97
STATE OF IDAHO )
) ss.
COUNTY OF SHOSHONE )
On this 18th day of October, 1993, before me, the undersigned, a Notary
Public in and for the State of Idaho, personally appeared X.X. Xxxxxxxx, known
to me and to me known to be the President of GOLD RUN GULCH MINING COMPANY, a
corporation whose name is subscribed to the foregoing instrument and
acknowledged to me that said individual executed the same.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my notarial
seal the day in this certificate first above written.
/s/ Xxxxxx Xxxxxx
Notary Public for the State of Idaho
Residing at Xxxxxxx, Idaho
My commission expires: 5/8/98
EXHIBIT A
TO MINING LEASE
Description of the Premises covered by Exploration Agreement and Option
to Lease between Gold Run Gulch Mining Company (Grantor), and Mine Systems
Design (Grantee), dated October 18, 1993, covering real property located in
Shoshone County, Idaho and shown on Exhibit B, Property Map, to wit:
a. Blue Xxx, Key Hole, Xxxxxxx Placer, and Amended Xxxxxxx Patented
Mining Claims, Mineral Survey 1998A, containing 57.780 acres.
b. New Jersey Mill Site Patented Mining Claim, Mineral Survey 1998B,
containing 3.971 acres.
c. Scotch Thistle, Triangle Fraction, Homestake, Center, North, South,
and Best Unpatented Mining Claims, IMC Serial Nos. 29642 through 29648.
d. Mineral rights only to SE 1/4 NW 1/4, NE 1/4 SW 1/4, and part of SW
1/4 NE 1/4, all in Section 00, Xxxxxxxx 00X, Xxxxx 3E, B.M., containing 107.83
acres.
