EXHIBIT 10.14
MOUNTAIN VIEW LEASE AGREEMENT
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STILLWATER COMPLEX, MONTANA
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THIS LEASE AGREEMENT ("Lease") is made and entered into as of the ___ day of
___________, 2003, by and between ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, individually and as Trustee,
LAURENNE ▇▇▇ ▇'▇▇▇▇▇▇▇ President of FORT STOCKTON INVESTMENTS, INC., and ▇▇▇▇▇
NICKEL MINES, INC., ▇▇▇▇ ▇▇▇▇▇▇▇▇ (a/k/a ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇), individually and as
Trustee of the 1985 deLANNOY FAMILY TRUST, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇▇,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇ (a/k/a ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇), ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, (collectively, "Lessors") and
AURORA METALS (BVI) LIMITED, a company incorporated in the British Virgin
Islands ("AMBVI"), having offices at ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇ (AMBVI is referred to as "Lessee" as further
described below).
RECITALS:
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By this Lease Agreement dated_________, 2003 ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, individually
and as Trustee, LAURENNE ▇▇▇ ▇'▇▇▇▇▇▇▇ President of FORT STOCKTON INVESTMENTS,
INC., and ▇▇▇▇▇ NICKEL MINES, INC., ▇▇▇▇ ▇▇▇▇▇▇▇▇ (a/k/a ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇),
individually and as Trustee of the 1985 deLANNOY FAMILY TRUST, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇,
▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ (a/k/a ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇), ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, (collectively,
"Lessors") lease to AURORA METALS (BVI) LIMITED (AMBVI), certain patented and
unpatented mining claims and tunnel sites located in Stillwater County, Montana.
▇. ▇▇▇▇▇ OF LEASE
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For and in consideration of the sum of ten dollars ($10.00) cash in hand
paid by Lessee to Lessors, the receipt of which is hereby acknowledged, in
consideration of the royalties and payments herein covenanted to be paid by
Lessee, and in consideration of the mutual covenants hereinafter set forth,
Lessors do hereby demise, lease and let unto Lessee those certain patented and
unpatented mining claims, mill sites and tunnel sites (collectively, the
"Subject Premises"), all listed in Schedule "1", "2", and "3", attached, and
incorporated herein by this reference, situated in Stillwater County, Montana
respectively, together with such of Lessors' water and water rights as
identified in Schedule "4", attached and incorporated herein by this reference
(Lessors do not warrant any particular volume or flow-rate), and as Lessee shall
require for its operations.
In connection with, and as part of the leasehold estate hereby granted,
Lessee shall have and may exercise the following rights for the benefit of all
lands owned, leased or controlled by Lessee:
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c. the right to explore, develop, mine, extract and remove or sell all
ores, minerals and metals, (including without limitation nickel,
copper, chromite and platinum group metals), precious stones, or rocks
found in, on or under the Subject Premises;
d. the right, during the continuance of this Lease, to take and use any
material suitable for backfilling, or for other mining purposes, and
any limestone found in the premises;
e. the right to use all existing facilities, on the Subject Premises, and
the right to construct all ▇▇▇▇▇, plants, tracks, tramways, roads,
buildings, and other improvements;
f. the right to use and develop any and all excavations, openings,
tunnels, ditches, flumes, drains and other improvements on the Subject
Premises:
g. the right to use all water and water rights identified in Schedule 5
and to develop additional water and water rights appurtenant to the
Subject Premises;
h. the right to do all other acts and things which are, or may become
necessary or suitable in the discretion of Lessee, including without
limitation the right to use or disturb so much of the surface and
surface resources of the Subject Premises as Lessee may deem
desirable, for the mining and removing of ores, minerals, metals,
precious stones and rocks, the milling, beneficiating, concentrating,
smelting, refining, or leaching of such ores, minerals, metals, and
other materials, or the concentrates thereof;
i. the right to cut and use timber and other raw materials found upon, or
in said premises for any purpose in connection with the operations to
be carried on under this Lease; and
j. such rights of surface and underground access for men, equipment,
supplies, utilities and water as may be necessary or convenient for
the conduct of Lessee's operations on any portion of the Subject
Premises or on other lands, including necessary access under, upon,
and across any other contiguous land owned or controlled by Lessors or
over which Lessors may have dominion or control.
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II. PRIMARY TERM AND LEASE PAYMENTS
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A. Term. Unless sooner terminated by the provisions hereof, this Lease
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shall remain in full force and effect for an initial term of ten (10) years from
the date hereof (the "Primary Term") and so long thereafter as ore-bearing
materials are produced from the Subject Premises in Commercial Quantities, as
that term is defined in Article VI of this Lease.
B. Work Commitment. It is expressly intended by the parties to negate and
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remove any obligation on the part of the Lessee, express or implied, to explore,
develop or mine the Subject Premises with reasonable diligence during said
ten-year Primary Term or during any five-year extension as provided in Articles
II.C. and II.D.
C. Extension of Primary Term. Lessee, so long as it shall not be in default
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under the terms and provisions of this Lease, and so long as it is not already
producing from the Subject Premises in Commercial Quantities as defined in
Article VI and has not extended the Primary Term by making the Advance Royalty
payment described in Article II.D. below, shall have the exclusive right,
privilege and option to extend the Primary Term for an additional term of five
(5) years upon the following terms and conditions:
1. Written notice of Lessee's intent to extend the Primary Term
shall be given by Lessee to Lessors at least sixty (60) days prior to the
expiration of the initial ten-year Primary Term.
2. Lessee at the time of giving its notice of extension, shall
make one lease payment in the amount of fifty thousand dollars ($50,000.00) (the
"Extension Payment") to Lessors as consideration for the five-year extension of
the Primary Term.
D. BLM Fees. Within ninety (90) days of the date of execution of this
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agreement Lessee agrees to repay Lessors Bureau of Land Management ("BLM")
unpatented mineral claim fees of seven thousand and seven hundred dollars
($7,700) for the 2003/2004-assessment year.
E. Advanced Royalty. Lessee shall pay Lessor an advance royalty of five
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hundred thousand dollars ($500,000.00) (the "Advance Royalty") at such time as
Lessee makes a decision to commence construction of a mine designed to produce
ore-bearing material in Commercial Quantities. Such payment shall automatically
extend the Primary Term for an additional five years beyond the Primary Term in
effect as of the date of such payment. Fifty percent (50%) of the Advance
Royalty shall be deemed an advance upon, and credited against, any royalties
payable upon later production from the Subject Premises. Such fifty percent of
the Advance Royalty shall be recouped by Lessee through direct
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deduction from the royalties provided by Article IV ("Production Royalties") as
they accrue.
F. Payments. All payments of Advance Royalty, Extension Payment and
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Production Royalties or other money payable to Lessor under this Lease shall be
paid to Lessors by mailing or delivering a cashiers check to ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇,
Trustee, herein designated by Lessors as their representative and depository,
the Lessors hereby granting to said depository full power and authority on
behalf of Lessors, their successors and assigns to collect and distribute all
sums of money due and payable hereunder. Adequate payment by Lessee to such
designated representative and depository shall be deemed full and adequate
payment to all Lessors. Notwithstanding the death of any Lessor or the transfer,
division, or hypothecation of a Lessor's royalty or other interest, payment or
tender of any payment to the depository as herein designated shall be binding
upon all Lessors, their heirs, personal representatives, transferees and
assignees. Change of designated representative and depository by Lessors shall
not be effective nor binding upon Lessee until written notice is received by
Lessee of such changed designated representative and depository. Lessors shall
at all times cause there to be a single designated representative and
depository.
G. Payment in Kind. Lessors may elect, by 60 days' prior notice to Lessee,
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to take their Production Royalties in kind, and the cost, if any, of doing so
shall be borne entirely by Lessors.
H. Proportional Payments. If Lessors own less than 100% of the mineral
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estate, whether in fee or under mining claim, lease, or contract in the Subject
Premises, or any portion thereof, subject to the paramount title of the United
States, then the Production Royalties, Extension Payment and Advance Royalty
which are payable under this Lease shall be reduced in the proportion which
Lessors' interest bears to 100% of the mineral estate of the Subject Premises.
III. TITLE
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A. Representations and Warranties. Lessors make the following
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representations and warranties effective as of the date of this Lease:
1. With respect to the patented claims, subject to Lessee's rights under
the Original Lease, Lessors own such claims free and clear of all defects, liens
and encumbrances arising by, through or under Lessors, or any one of them, and
Lessors have no knowledge of adverse claims or interests.
2. With respect to unpatented mining claims and mill site claims located by
Lessors, or any one of them, that are included in the Subject Premises, subject
to the paramount title of the United States, to the best of their knowledge and
belief:
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a. the unpatented mining claims were properly laid out
and monumented;
b. all required location validation work was properly
performed;
c. location notices and certificates were properly recorded and
filed with appropriate governmental agencies;
d. all assessment work required to hold the unpatented mining
claims was performed for the assessment years ending
September 1, 1986 and 1987; and
e. All affidavits of assessment work and other filings required
to maintain the claims in good standing were properly and
timely recorded or filed with appropriate governmental
agencies for the assessment years ending September 1, 1986
and 1987.
3. With respect to those unpatented mining claims that were not located by
Lessors, but are included within the Subject Premises, and with respect to
completion of assessment work and filing of affidavits of assessment work for
all unpatented mining claims for all assessment years not specified above,
Lessors make the foregoing representations to the best of their knowledge and
belief.
4. With respect to all unpatented mining claims and mill site claims
included in the Subject Premises, subject to Lessee's rights under the Original
Lease, Lessors warrant that the claims are free and clear of liens and
encumbrances arising by, through or under Lessors, or any one of them; and
Lessors have no knowledge of adverse claims or interests.
5. With respect to the Subject Premises, Lessors have no knowledge of
threatened actions, suits, claims or proceedings.
6. Lessors have delivered or will deliver to Lessee all information
reasonably requested by Lessee concerning title to the Subject Premises in
Lessors' possession.
7. Subject to Lessee's rights under the Lease, Lessors own the Subject
Premises and no other parties own any interest therein, or in any portion
thereof.
The representations and warranties set forth above shall survive the
execution and delivery of any documents of transfer provided under this Lease.
Nothing in this Article III, however, shall be deemed to be a representation or
a
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warranty that any of the unpatented mining claims contains a discovery of
minerals.
B. Lessors' Covenants. Lessors covenant that during the term of this Lease,
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Lessors shall maintain their interests in the Subject Premises free and clear of
any liens and encumbrances, not in existence on the date hereof, and not
resulting from Lessee's operations and activities hereunder.
C. Disclosures. Lessors and Lessees represent and warrant that they are
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unaware of any material facts or circumstances which have not been disclosed in
this Lease, which should be disclosed to the other party in order to prevent the
representations in this Article III from being materially misleading.
IV. PRODUCTION ROYALTIES
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A. All Minerals. Lessee shall pay to Lessors a Production Royalty of two
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percent (2%) of the Net Smelter Returns (if sold to a mill, smelter or refinery)
or Net Income (if not sold to a mill smelter or refinery), whichever is
applicable, from the sale of all ores or concentrates, from the Subject
Premises. Lessors may take in kind pursuant to Article II.G. By "Net Smelter
Returns" is meant the amount received from the mill or smelter upon the sale of
such ores or concentrates after deducting from the gross value thereof the cost
of milling, concentrating, processing, smelting, refining and transportation to
the mill, smelter or refinery. By "Net Income" is meant the amount received by
Lessee from a purchaser of ores or concentrates other than a mill, smelter or
refinery, less costs of milling, concentrating, processing, refining and
transportation (if any).
B. Ores and Concentrates Not Sold. If ores, concentrates or other products
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are taken in kind (produced and removed from the subject premises, but not sold)
by Lessee, then Lessee shall nevertheless pay the Production Royalty as
specified above, in which case the amounts received by Lessee (for purposes of
calculating net smelter returns or net income) shall be deemed to be the amounts
Lessee would have received if a sale of ore or concentrates had been made.
Payments shall be made in accordance with the provision in Article IV.C. Ores,
minerals or other products produced by Lessee from the Subject Premises that are
used by Lessee or its agents in the processing or refining of ores and
concentrates shall not be deemed to be products taken in kind by Lessee, and no
royalty need be paid upon such products.
C. Payment. Royalty payments may be paid to the Lessors in accordance with
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Articles II.F and II.H above and shall be payable within a period of twenty-one
(21) days after the shipment and/or removal of ore or concentrates produced from
the Subject Premises and/or receipt of proceeds from sale of other minerals
during each mining period of one month. Accompanying each payment, Lessee shall
furnish to Lessor a statement of the production used as a basis for computing
royalties.
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D. Federal Royalty. In the event the federal government imposes a royalty
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on any of the Subject Premises (the "Federal Royalty"), fifty percent (50%) of
any Federal Royalty payment may be offset against and deducted from any
Production Royalties payable to Lessors hereunder.
V. MAINTENANCE OF MINING CLAIMS
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During the continuance of this Lease, Lessee agrees to comply with the
requirements of the state and federal statutes with respect to assessment work
or maintenance fees in lieu of assessment work with respect to the unpatented
claims within the Subject Premises . Lessee shall not, however, be liable or
responsible for any claim or claims which may be lost as a result of
insufficient performance of assessment work or improper payment of fees, so long
as Lessee has made a good faith attempt to perform the required assessment work
or pay fees. Lessee will provide to Lessor a copy of the operating plan
submitted to the National Forest Service with respect to the Subject Premises.
Lessee shall pay the cost of spraying noxious weeds on the Subject Premises
as required by law.
This Lease shall cover and extend to any further or additional right,
title, interest or estate acquired by Lessors, or any of them, in or to the
Subject Premises or any portion thereof.
Lessee agrees to carry on its operations hereunder, diligently and in a
good and miner-like manner, and in accordance with accepted mining practices in
the State of Montana, and Lessee agrees that all mining operations shall be
carried on in a systematic, orderly and economical manner so as to realize
insofar as is practicable, the full ore resources of the Subject Premises.
VI. PRODUCTION IN COMMERCIAL QUANTITIES
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For purposes of this Lease, the term "Commercial Quantities" shall mean
production at a minimum level of 100,000 short tons of ore per annum, an average
of 275 tons of ore per day. Production in Commercial Quantities commences when
production from the Subject Premises on a commercial basis (excluding pilot or
test operations) first reaches an average of 275 tons of ore per day for a
90-day period (the first day of said 90-day period shall constitute "Initial
Commercial Production") and continues thereafter until the end of a production
year in which the total production for the year, including production credited
to the year as set forth below, is less than 100,000 tons of ore, the initial
production year being the one-year period commencing as of the Initial
Commercial Production and subsequent production years being the subsequent
one-year periods each commencing on the anniversary of the Initial Commercial
Production. If Lessee in any production year produces in excess of 100,000 tons
of ore, 50% of the production in excess of 100,000 tons shall be credited toward
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production in any subsequent production year or years in which actual production
is less than 100,000 tons of ore, provided that production of less than an
average of 275 tons of ore per day shall not continue for longer than any
18-month period, and during any 18-month period when production is less than an
average of 275 tons of ore per day, Lessee shall nevertheless continue mine
development activities which includes without limitation drilling, stoping,
raising, raise-boring or shaft-sinking. If Commercial Production would have
ceased during the Primary Term of this Lease, or at the end of the production
year in which the Primary Term ends, Commercial Production shall be deemed to
have continued if prior to the end of the Primary Term of this Lease, or prior
to the end of the production year in which the Primary Term ends, production
again reaches an average of 275 tons of ore per day for a 90-day period, the
first day of which shall then constitute the Initial Commercial Production for
purposes hereof.
VII. TAXES, ENCUMBRANCES AND INJURIES
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A. Taxes. Lessee agrees to pay and discharge the Lessor for any and all and
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all taxes levied against the Subject Premises as paid by the Lessor during the
life of this Lease, except that in those cases in which said taxes cover a
period during only a part of which this Lease is in force, Lessee shall pay and
discharge only its pro rata share thereof determined by a comparison of such
part with the total period covered.
B. Lessee's Encumbrances. Lessee will not permit any liens or encumbrances
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on the unpatented and patented mining claims of the Subject Premises.
Notwithstanding anything to the contrary in this section, the parties agree that
Lessee has the right to encumber, as it deems necessary or convenient, its
leasehold interest including without limitation its share of production and
proceeds, so as not to interfere with Lessors' royalties.
C. Injuries from Lessee's Operations. Lessee shall save Lessors harmless
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from any and all damages, claims, costs and expenses arising from or growing out
of any or all injuries resulting from the operations of Lessee, or in connection
therewith, on the Subject Premises and occurring during the life of this Lease
except as provided in Article XII herein.
VIII. TERMINATION
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A. The Lease may be terminated by Lessee at any time after the expiration
of one (1) year from the date of this Lease by notice in writing thereof to
Lessors, to take effect from such date as may be stipulated by Lessee in such
notice, without, subject to the following paragraph, the Lessee incurring any
further liability whatsoever as regards Advance Royalty or other payments or
obligations.
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B. Subject to the foregoing paragraph, upon such termination, Lessee shall
have no further interest or right in the Subject Premises, save the right to
remove its property as provided in Article XI, including all stockpiles of ore
and concentrates on which royalty shall have been paid, and shall have no
obligation or duties with respect to the Subject Premises, except for
reclamation of lands disturbed by Lessee and required by governmental authority
to be reclaimed, and except as herein specifically provided and as to
obligations which have accrued hereunder prior to such termination, but all
fences or enclosures protecting open pits, shafts, tunnels, etc., shall be left
intact and Lessors shall be entitled to retain the entire amount of any moneys
paid under this Lease up to the effective date of termination.
C. This Lease shall not terminate for nonpayment by Lessee of royalties,
unless such nonpayment continues for 60 days after notice and Lessors give
notice of termination pursuant to Article XVII.
IX. FORCE MAJEURE
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Lessee shall be excused from the performance of its obligations of every
kind, except necessary annual assessment work or maintenance fees in lieu of
assessment work, during such period or periods as performance may be made
impossible by force majeure, and during such period or periods of force majeure
it shall be deemed that production is occurring in Commercial Quantities under
this Lease. By this it is intended to mean that the Lessee shall be excused from
the performance of any provision of this Lease for such period of time as
performance of such provision is prevented by fire, flood, earthquake,
explosion, lack of transportation facilities, Act of God, shortage of power or
water, strike or similar labor difficulties, insurrection or mob violence,
requirement or regulation of government, or other causes beyond the reasonable
control of Lessee. For purposes of this Lease, force majeure shall include a
drop in the prices of ores, minerals and metals such that it is uneconomic to
produce said ores, minerals or metals.
X. RECORDS
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Within a reasonable time, not to exceed six (6) months, following the
termination of this Lease for any cause, Lessee shall furnish to Lessors a copy
of its factual maps, drilling records, drill core and assay and smelter reports
relating to the Subject Premises.
Lessors agree, upon reasonable request by Lessee, to furnish to Lessee such
maps, records, reports and documents, as Lessors may possess relating to the
Subject Premises. Such maps, records, reports and documents shall be returned,
if requested, to Lessors within a reasonable time not to exceed 90 days.
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XI. REMOVAL
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Upon the termination of this Lease for any reason, Lessee shall have the
right to remove from the Subject Premises, at any time within the 12-month
period following such termination, all stockpiles of ore and concentrates upon
which royalties shall have been paid, and all of its machinery, equipment,
tools, structures or other property and improvements, fixtures and structures
constructed, erected or placed on the Subject Premises, or any portion thereof,
by Lessee; provided, however, Lessee shall leave in place all timbering, framing
or enclosures protecting open pits, shafts, tunnels and underground trackage;
and provided that removal of improvements, fixtures and structures shall not
damage the structures remaining on the Subject Premises.
XII. POSSESSORY RIGHTS
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While this Lease is in effect, Lessee shall be entitled to exclusive
possession of the Subject Premises, except that Lessors and their
representatives, successors and assigns, at any reasonable time, may go upon the
Subject Premises to inspect the operations of Lessee thereon. Lessors are
further entitled to access to claims not included under this Lease ("Lessors'
Claims") across the Subject Premises for men, equipment, supplies, utilities,
water and all other items as may be reasonably necessary for the exploration,
development and operation of Lessors' Claims; provided, however, that in so
doing Lessors shall not unreasonably hinder Lessees' work; and provided further
that the Lessors hereby release Lessee from liability for any personal injury or
death of any employee or representative of Lessors while on the Subject Premises
and the Lessors agree that they will indemnify and save harmless Lessee from
liability for any personal injury to or death of any person or persons, or
damage or destruction of property of Lessee or others done or caused by any
employee or representative of Lessors while so visiting or traversing the
Subject Premises. Lessors further agree to hold Lessee harmless from any
liability and to indemnify Lessee for any claims, costs, expenses and fees
arising from Lessors' activities on Lessors' Claims.
XIII. RELOCATION AND AMENDMENT
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Lessee shall have the right at any time or times during the term of this
Lease, upon written notice to Lessors, to amend the location of any one or more
of the unpatented mining claims or mill site claims whenever such amendment is
deemed necessary or desirable to correct errors or omissions in the location of
the claim. Lessee shall have the further right, upon written notice to Lessors,
to relocate any one or more of said claims whenever such action is deemed to be
necessary or desirable. All such relocations or amendments shall be made by
Lessee as agent for Lessors, placing all such amendments and relocations in the
name of Lessors.
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Lessee shall have the further right at its discretion to repair or replace
any claim location monument or marking which has been damaged or destroyed,
although Lessee shall not be obligated to perform such repairs or replacements.
XIV. PATENTING
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Upon request of Lessee at any time or times during the term of this Lease,
Lessors agree to undertake and obtain patent to any or all of the mining claims
or mil site claims which are subject to this Lease, as designated by Lessee, and
Lessee shall prepare all documents and compile all data and comply in all
respects with the applicable law, all at the expense of Lessee. Any patent
issued shall be in Lessors' names, or in a name designated by Lessors. Lessors
shall execute any and all documents required for this purpose and shall
cooperate fully with Lessee in the patent application and proceedings subsequent
thereto. If Lessors begin or have begun patent proceedings and Lessee thereafter
or hereafter requests Lessors to discontinue such proceedings, or if this Lease
is terminated while patent proceedings are pending, Lessee shall have no further
obligations with respect thereto, except to pay any unpaid expenses accrued in
such proceedings prior to its request to discontinue, or prior to termination,
whichever occurs first.
XV. COMMINGLING
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Lessee shall have the right to commingle ore and minerals from the Subject
Premises, or any portion thereof, with ore or minerals from other property.
XVI. DRAFTING OF DOCUMENT - MUTUAL
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This Lease has been drafted through the joint efforts of the Lessors and
Lessee and their respective attorneys, and neither of the parties hereto shall
be permitted to claim that the drafting of this Lease was performed or
accomplished to a greater extent by the other party.
The parties acknowledge that they have retained or employed their own
respective attorneys or counsel in the preparation and/or examination of this
document.
XVII. DEFAULT
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In the event that Lessee shall default in the performance of any of the
terms and provisions of this Lease, then, after written notice of such default
from Lessors to Lessee, if Lessee does not either:
A. Cure such default within sixty (60) days after such notice, or
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B. Commence promptly within the said period of sixty (60) days to rectify
such default and continue thereafter to use due diligence to rectify
such default until it is fully remedied or cured,
Lessors may terminate this Agreement at any time thereafter during the
continuance of such default by giving written notice to Lessee of their election
to terminate.
XVIII. NOTICE
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Any notice required or permitted to be given or served by one of the
parties hereto shall be sufficiently given or served by a communication in
writing, sent by registered or certified mail, to the other party at the address
given below:
FOR THE LESSORS
▇▇▇▇▇▇▇ ▇. and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Laurenne ▇▇▇ ▇'▇▇▇▇▇▇▇
President, Fort Stockton Investments, Inc., and ▇▇▇▇▇ Nickel Mines, Inc.,
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇. ▇▇▇▇▇
FOR THE LESSEE
Aurora Metals (BVI) Limited
P. O. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇-▇▇▇▇
Any party may change its address by giving written notice of such change to
the other parties.
XIX. ASSIGNMENT
----------
Lessee's assignment of the benefit of this Lease may only be made with the
consent of the Lessors, which consent will not be unreasonably withheld.
XX. CONFIDENTIALITY
---------------
Lessors agree that all information developed or acquired by Lessee as a
result of work under this Lease and conveyed to Lessors, or any one of them,
including but not limited to information relating to ore reserves, mineral
discoveries, mining or processing methods, plans, production schedules and
12
other information shall be kept strictly confidential by Lessors until released
or made public by Lessee.
XXI. TIME OF ESSENCE: BINDING EFFECT
-------------------------------
Time is of the essence in this Lease. Each obligation set forth herein
shall extend to and be binding upon and every benefit inure to the heirs,
personal representatives, successors or assigns of the parties hereto.
Page 16 of 31 Mountain View Lease Agreement December 4, 2003
XXII. FURTHER ASSURANCES
------------------
The parties agree to execute and deliver such other documents as may be
necessary to effectuate the intents and purposes of this Lease.
XXIII. ENTIRE AGREEMENT
----------------
This Lease may not be amended except in writing by duly authorized
representatives of the parties. This Lease constitutes the entire agreement
between the parties with respect to the subject matter hereof and supersedes all
prior agreements with respect to all matters covered hereby. The parties agree
that this Lease shall replace and supercede the Original Lease, provided that
neither the execution nor any provision hereof shall interrupt or otherwise
affect Lessee's continuous rights in and possession of the Subject Premises.
XXIV. GOVERNING LAW
-------------
This Lease shall be governed by Montana law and the parties hereby submit
to the jurisdiction of the Montana courts, including the federal courts of the
district of Montana.
XXV. MEMORANDUM OF AGREEMENT
-----------------------
This Lease shall not be recorded without the consent of both parties. Upon
the request of either party, both parties shall execute a Memorandum of this
Lease in recordable form, which memorandum may be recorded.
XXVI. COUNTERPARTS
------------
This Lease may be executed in counterparts, no one of which needs to be
executed by all Lessors, and shall be binding upon each party upon execution by
that party, and shall be effective as if all parties had signed the same
document.
IN WITNESS WHEREOF, the parties hereto have caused this Lease to be duly
executed, as of the day and year first above written.
13
LESSORS:
--------
▇▇▇▇▇ NICKEL MINES, INC.
_____________________________________
LAURENNE ▇▇▇ ▇'▇▇▇▇▇▇▇, President
_____________________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, individually and as
trustee
_____________________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, individually
FORT STOCKTON INVESTMENTS, INC.
_____________________________________
LAURENNE ▇▇▇ ▇'▇▇▇▇▇▇▇, President
_____________________________________
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, individually and as
Trustee of the 1985 deLANNOY FAMILY TRUST
_____________________________________
▇▇▇▇ ▇. ▇▇▇▇▇
_____________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
_____________________________________
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
_____________________________________
▇▇▇▇▇ ▇▇▇▇
_____________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
_____________________________________
▇▇▇▇ ▇▇▇▇▇▇▇▇
_____________________________________
▇▇▇▇▇▇▇ ▇▇▇▇▇
_____________________________________
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
14
_____________________________________
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
_____________________________________
▇▇▇▇▇▇ ▇▇▇▇▇
_____________________________________
▇▇▇▇▇ ▇▇▇▇▇
_____________________________________
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
LESSEE:
-------
AURORA METALS (BVI) LIMITED
_____________________________________
▇▇▇▇ ▇. ▇. ▇▇▇▇▇, President
15
STATE OF MONTANA, )
)ss.
COUNTY OF __________________________ )
This instrument was acknowledged before me on _______________, 2003, by ▇▇▇▇▇▇▇
▇. ▇▇▇▇▇, individually and as Trustee.
______________________________________
Notary Public for the State of Montana
Residing at _________________, Montana
My commission expires ________________
(Notarial Seal)
STATE OF CALIFORNIA, )
)ss.
COUNTY OF __________________________ )
This instrument was acknowledged before me on _______________, 2003, by ▇▇▇▇
▇▇▇▇▇▇▇▇, individually and as Trustee of the 1985 deLannoy Family Trust.
_________________________________________
Notary Public for the State of California
Residing at _________________, California
My commission expires ___________________
(Notarial Seal)
STATE OF CALIFORNIA, )
)ss.
COUNTY OF __________________________ )
This instrument was acknowledged before me on _______________, 2003, by Laurenne
▇▇▇ ▇'▇▇▇▇▇▇▇, individually, and as President of Fort Stockton Investments, Inc.
and ▇▇▇▇▇ Nickel Mines, Inc.
_________________________________________
Notary Public for the State of California
Residing at _________________, California
My commission expires ___________________
16
(Notarial Seal)
STATE OF MONTANA, )
)ss.
COUNTY OF __________________________ )
This instrument was acknowledged before me on _______________, 2003, by ▇▇▇▇▇▇▇
▇. ▇▇▇▇▇.
______________________________________
Notary Public for the State of Montana
Residing at _________________, Montana
My commission expires ________________
STATE OF MONTANA, )
)ss.
COUNTY OF __________________________ )
This instrument was acknowledged before me on _______________, 2003, by ▇▇▇▇ ▇.
▇▇▇▇▇.
______________________________________
Notary Public for the State of Montana
Residing at _________________, Montana
My commission expires ________________
(Notarial Seal)
STATE OF MONTANA, )
)ss.
COUNTY OF __________________________ )
This instrument was acknowledged before me on _______________, 2003, by ▇▇▇▇▇▇
▇. ▇▇▇▇▇.
______________________________________
Notary Public for the State of Montana
Residing at _________________, Montana
My commission expires ________________
17
(Notarial Seal)
STATE OF MONTANA, )
)ss.
COUNTY OF __________________________ )
This instrument was acknowledged before me on _______________, 2003, by ▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇.
______________________________________
Notary Public for the State of Montana
Residing at _________________, Montana
My commission expires ________________
(Notarial Seal)
STATE OF MONTANA, )
)ss.
COUNTY OF __________________________ )
This instrument was acknowledged before me on _______________, 2003, by ▇▇▇▇▇
▇▇▇▇.
______________________________________
Notary Public for the State of Montana
Residing at _________________, Montana
My commission expires ________________
(Notarial Seal)
STATE OF ARIZONA, )
)ss.
COUNTY OF __________________________ )
This instrument was acknowledged before me on _______________, 2003, by ▇▇▇▇▇▇
▇. ▇▇▇▇▇▇.
______________________________________
Notary Public for the State of Arizona
Residing at _________________, Arizona
My commission expires ________________
18
(Notarial Seal)
STATE OF MONTANA, )
)ss.
COUNTY OF __________________________ )
This instrument was acknowledged before me on _______________, 2003, by ▇▇▇▇
▇▇▇▇▇▇▇▇.
______________________________________
Notary Public for the State of Montana
Residing at _________________, Montana
My commission expires ________________
(Notarial Seal)
STATE OF MONTANA, )
)ss.
COUNTY OF __________________________ )
This instrument was acknowledged before me on _______________, 2003, by ▇▇▇▇▇▇▇
▇▇▇▇▇.
______________________________________
Notary Public for the State of Montana
Residing at _________________, Montana
My commission expires ________________
(Notarial Seal)
STATE OF MONTANA, )
)ss.
COUNTY OF __________________________ )
This instrument was acknowledged before me on _______________, 2001, by ▇▇▇▇ ▇.
▇▇▇▇▇▇▇.
______________________________________
Notary Public for the State of Montana
Residing at _________________, Montana
My commission expires ________________
19
(Notarial Seal)
STATE OF MONTANA, )
)ss.
COUNTY OF __________________________ )
This instrument was acknowledged before me on _______________, 2003, by ▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇.
______________________________________
Notary Public for the State of Montana
Residing at _________________, Montana
My commission expires ________________
(Notarial Seal)
STATE OF WYOMING )
)ss.
COUNTY OF __________________________ )
This instrument was acknowledged before me on _______________, 2003, by ▇▇▇▇▇▇
▇▇▇▇▇.
______________________________________
Notary Public for the State of Wyoming
Residing at _________________, Wyoming
My commission expires ________________
(Notarial Seal)
STATE OF WYOMING )
)ss.
COUNTY OF __________________________ )
This instrument was acknowledged before me on _______________, 2003, by ▇▇▇▇▇
▇▇▇▇▇.
______________________________________
Notary Public for the State of Wyoming
Residing at _________________, Wyoming
My commission expires ________________
20
(Notarial Seal)
STATE OF MONTANA, )
)ss.
COUNTY OF __________________________ )
This instrument was acknowledged before me on _______________, 2003, by ▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇.
______________________________________
Notary Public for the State of Montana
Residing at _________________, Montana
My commission expires ________________
(Notarial Seal)
STATE OF COLORADO, )
)ss.
COUNTY OF __________________________ )
This instrument was acknowledged before me on _______________, 2003, by ▇▇▇▇ ▇.
▇. ▇▇▇▇▇, President of Aurora Metals (BVI) Limited.
_______________________________________
Notary Public for the State of Colorado
Residing at _________________, Colorado
My commission expires _________________
21
(Notarial Seal)
SCHEDULE 1 MOUNTAIN VIEW LEASE AGREEMENT
PATENTED LODE AND PLACER CLAIMS IN STILLWATER COUNTY
MONTANA
Mineral Claim Status BLM Montana
Name Mineral Claim #
1 Bald Eagle Patented East Stillwater River MSN 69D
22
SCHEDULE 2 MOUNTAIN VIEW LEASE AGREEMENT
LODE AND PLACER CLAIMS FOR WHICH PATENT HAS BEEN APPLIED
FOR IN STILLWATER COUNTY, MONTANA
Mineral Claim Status BLM Montana
Name Mineral Claim
#
1 ▇▇▇ 19 Patent Applied For Mountain View MMC 10209
2 ▇▇▇ 20 Patent Applied For Mountain View MMC 10210
3 ▇▇▇ 21 Patent Applied For Mountain View MMC 10211
4 SUSU 25 Patent Applied For Mountain View MMC 53589
5 SUSU 28 Patent Applied For Mountain View MMC 53592
6 SUSU 29 Patent Applied For Mountain View MMC 53593
7 ▇▇▇▇▇ 1 Lode Patent Applied For Mountain View MMC 186404
8 ▇▇▇▇▇ 2 Lode Patent Applied For Mountain View MMC 186405
9 ▇▇▇▇▇ 3 Lode Patent Applied For Mountain View MMC 186406
10 ▇▇▇▇▇ 4 Lode Patent Applied For Mountain View MMC 186407
11 ▇▇▇▇▇ 5 Lode Patent Applied For Mountain View MMC 186408
12 ▇▇▇▇▇ 6 Lode Patent Applied For Mountain View MMC 186409
13 ▇▇▇▇▇ 7 Lode Patent Applied For Mountain View MMC 186410
14 ▇▇▇▇▇ 8 Lode Patent Applied For Mountain View MMC 186411
15 ▇▇▇▇▇ 9 Lode Patent Applied For Mountain View MMC 186412
16 ▇▇▇▇▇ 10 Lode Patent Applied For Mountain View MMC 186413
17 ▇▇▇▇▇ 11 Lode Patent Applied For Mountain View MMC 186414
18 ▇▇▇▇▇ 12 Lode Patent Applied For Mountain View MMC 186415
19 ▇▇▇▇▇ 13 Lode Patent Applied For Mountain View MMC 186416
20 ▇▇▇▇▇ 14 Lode Patent Applied For Mountain View MMC 186417
▇▇ ▇▇▇▇ ▇▇▇▇▇▇ Patent Applied For Mountain View MMC 189232
23
SCHEDULE 3 MOUNTAIN VIEW LEASE AGREEMENT
UNPATENTED LODE AND PLACER CLAIMS IN STILLWATER COUNTY, MONTANA
Mineral Claim Status BLM Montana
Name Mineral Claim #
1 ▇▇▇ 1 Unpatented West Stillwater River MMC 10191
2 ▇▇▇ 2 Unpatented West Stillwater River MMC 10192
3 ▇▇▇ 3 Unpatented West Stillwater River MMC 10193
4 ▇▇▇ 13 Unpatented West Stillwater River MMC 10203
5 ▇▇▇ 14 Unpatented West Stillwater River MMC 10204
6 ▇▇▇ 15 Unpatented West Stillwater River MMC 10205
7 ▇▇▇ 16 Unpatented West Stillwater River MMC 10206
8 ▇▇▇ 17 Unpatented West Stillwater River MMC 10207
9 ▇▇▇ 18 Unpatented West Stillwater River MMC 10208
10 ▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇
11 ▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇
12 GYPSUM Unpatented West Stillwater River MMC 35156
PLACER
13 DUKE Unpatented West Stillwater River MMC 35157
PLACER 5/8th Interest. No buildings
14 ▇▇▇ #1 Unpatented West Stillwater River MMC 35958
15 ▇▇▇ #2 Unpatented West Stillwater River MMC 35959
16 ▇▇▇ 3 fr. Unpatented West Stillwater River MMC 35960
17 ▇▇▇ 4 Unpatented West Stillwater River MMC 35961
18 ▇▇▇ 4A Unpatented West Stillwater River MMC 35962
19 ▇▇▇ 5 Unpatented West Stillwater River MMC 35963
20 ▇▇▇ 5A Unpatented West Stillwater River MMC 35964
21 ▇▇▇ 6 Unpatented West Stillwater River MMC 35965
22 ▇▇▇ 6A Unpatented West Stillwater River MMC 35966
23 ▇▇▇ 7 Unpatented West Stillwater River MMC 35967
24 ▇▇▇ 8 Unpatented West Stillwater River MMC 35968
25 ▇▇▇ 9 Unpatented West Stillwater River MMC 35969
26 ▇▇▇ 10 Unpatented West Stillwater River MMC 35970
27 ▇▇▇ 28 Unpatented West Stillwater River MMC 35988
28 ▇▇▇ 29 Unpatented West Stillwater River MMC 35989
29 ▇▇▇ 30 Unpatented West Stillwater River MMC 35990
30 ▇▇▇ 44 Unpatented West Stillwater River MMC 36004
31 GAY 1 Unpatented West Stillwater River MMC 36281
32 GAY 2 Unpatented West Stillwater River MMC 36282
33 GAY 6 Unpatented West Stillwater River MMC 36286
34 GAY 7 Unpatented West Stillwater River MMC 36287
35 GAY 11 Unpatented West Stillwater River MMC 36291
36 GAY 12 Unpatented West Stillwater River MMC 36292
37 GAY 15 Unpatented West Stillwater River MMC 36295
38 GAY 16 Unpatented West Stillwater River MMC 36296
24
SCHEDULE 3 MOUNTAIN VIEW LEASE AGREEMENT (continued)
UNPATENTED LODE AND PLACER CLAIMS IN STILLWATER COUNTY, MONTANA
Mineral Status BLM Montana
Claim Mineral Claim #
Name
39 Mountain View Chrome Co. Unpatented West Stillwater River MMC 36376
40 ▇▇▇ Placer Unpatented West Stillwater River MMC 36379
41 No. 5 Tunnel & Tunnel Site Unpatented West Stillwater River MMC 36380
42 MALO Unpatented West Stillwater River MMC 36384
43 Red Bird No. 3 Unpatented West Stillwater River MMC 36396
44 ▇▇▇▇ ▇. Unpatented West Stillwater River MMC 36408
45 ▇▇▇▇ I Unpatented West Stillwater River MMC 36413
46 Verdi Placer Unpatented West Stillwater River MMC 36430
47 SUSU 22 Unpatented West Stillwater River MMC 53586
48 SUSU 23 Unpatented West Stillwater River MMC 53587
49 SUSU 24 Unpatented West Stillwater River MMC 53588
50 SUSU 26 Unpatented West Stillwater River MMC 53590
51 SUSU 27 Unpatented West Stillwater River MMC 53591
52 ▇▇▇ fr. Unpatented West Stillwater River MMC 78928
53 GAY fr. Unpatented West Stillwater River MMC 78929
54 NEW 13 Unpatented West Stillwater River MMC 84655
55 Red Bird # 4 Unpatented West Stillwater River MMC 36397
56 Mill Site 69E Unpatented West Stillwater River MSN 156775
25
SCHEDULE 4: WATER RIGHTS STILLWATER RIVER VALLEY AREA,
MOUNTAIN VIEW LEASE AGREEMENT
STILLWATER COUNTY, MONTANA
Lessors Water Right 43C-W-189530-00
Number
Source Mountain View Lake - SW NE Sec. 20, Twp. 5S,
Rge. 15E M.P.M, Stillwater County, Montana
Indicated Flow Rate: 1.34 CFS
Indicated Volume 486.27 acre feet per year
Purpose (Use): Industrial
Lessors Water Right 43C-W-189532-00
Number:
Source: Verdigris Creek - S SW NE Sec. 20, Twp. 5S,
Rge. 15E M.P.M, Stillwater County, Montana
Indicated Flow Rate: 0.09 CFS
Indicated Volume 49.79 acre feet per year
Purpose (Use): Domestic (multiple)
26
