FOURTH AMENDMENT TO MINERAL LEASE WITH OPTION TO PURCHASE
THIS FOURTH AMENDMENT to that Mineral Lease Agreement with Option to Purchase
dated February 19, 1991 is executed this 31st day of July, 1996 between H,
Xxxxxx Xxxxxx, Manager, and Xxxxxxxx Xxxxxx, Owner, (hereinafter referred to as
"Lessor"), and Great Basin Exploration & Mining Co., Inc., a Nevada corporation
(hereinafter referred to as "Lessee").
RECITALS
A. Lessor and Lessee are parties to the following:
"MINERAL LEASE AGREEMENT WITH OPTION TO PURCHASE Coal Canyon Property"
dated February 19, 1991 (hereinafter referred to as the "Mineral Lease
Agreement").
"AMENDMENT OF LEASE" dated January 13, 1991 (hereinafter referred to as the
"First Amendment").
"SECOND AMENDMENT TO MINERAL LEASE AGREEMENT WITH OPTION TO PURCHASE Coal
Canyon Property" dated May 17, 1994 (hereinafter referred to as the "Second
Amendment"),
"THIRD AMENDMENT TO MINERAL LEASE WITH OPTION TO PURCHASE Coal Canyon
Property, Eureka County, Nevada" entered the 15th day of February, 1996
(hereinafter referred to as the "Third Amendment").
(the foregoing Mineral Lease Agreement, First Amendment, Second Amendment
and Third Amendment hereinafter collectively referred to as the "Mineral Lease
Agreement as Amended").
X. Xxxxxx and Lessee desire to further amend the Mineral Lease Agreement as
Amended.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and of the mutual benefits
to be derived, Lessor and Lessee agree as follows:
1. The last sentence of the first paragraph of Section 3 of the Mineral
Lease Agreement is hereby revised to read as follows:
"Any and all payments made by LESSEE to LESSOR pursuant to Section 5
hereof, and all costs, if any, incurred by LESSEE for which LESSOR is liable
pursuant to paragraph b of Section 7 hereof shall be credited against the
purchase price."
2. The last sentence of paragraph b of Section 5 of the Mineral Lease
Agreement is hereby amended to read:
"The term 'Gross Returns" in any calendar quarter shall mean the amount of
earned revenues payable to LESSEE by any smelter, refinery, or other arm's
length purchaser of any and all Mineral Substances from the Premises, less any
smelting and sampling charges charged to LESSEE by said purchaser."
3. Paragraph d of Section 5 of the Mineral Lease Agreement is hereby
amended to read:
"d. Adjustment for Inflation - The purchase price as set forth in Section 3
shall be subject to escalation based upon the Consumer Price Index published by
the Bureau of Labor Statistics of the United States Department of Labor. The
applicable amount due LESSOR shall be multiplied by a percentage equal to 100,
plus the percentage increase in the Consumer Index from the effective date of
the Agreement, to the date of the close of the calendar quarter during which the
applicable payment is due."
4. Section 1 of the First Amendment and Section 1 of the Third Amendment
are hereby deleted and paragraph a of Section 5 of the Mineral Lease Agreement
is hereby amended to read as follows:
"A. Rental - Subject to LESSEE's right to terminate this Agreement, LESSEE
shall pay to LESSOR rental in the following amounts:
$15,000.00 on or before March 18, 1991,
$15,000.00 on or before October 1, 1991,
$30,000.00 between January 1 and January 15, 1992,
$20,000.00 between January 1 and January 15, 1993,
$20,000.00 between January 1 and January 15, 1994,
$20,000.00 between January 1 and January 15, 1995,
and of each year thereafter while the
Mineral Lease Agreement as Amended is
in effect.
LESSEE's obligation to make the rental payments shall terminate upon
the earlier of the commencement of payment of production royalties or upon its
exercise of the option to purchase the Premises, and all rental payments to
LESSOR shall be credited against the purchase price as calculated in Section 3."
5. Sction 2 of the first Amendment is hereby deleted and LESSOR and LESSEE
agree that Paragraph d of Section 9 of the Mineral Lease Agreement shall apply
only while federal or state law requires annual assessment work to be performed
on the Premises. When annual assessment is not required and the payment of
holding, rental or filing fees and filing of documents to federal state or
county offices or agencies is required, LESSEE will pay such fees and make such
filings on or prior to the date such payments and filings are required.
If the Mineral Lease Agreement is hereafter terminated by either
party, pursuant to Section 10 thereof, no further assessment work or filings or
payment of fees will be required by LESSEE.
6. Section 2 of the Third Amendment is hereby revised to read as follows:
"The Mineral Lease Agreement As Amended is hereby amended to effect a
work commitment by LESSEE of $100,000.00 to be spent between January 1, 1996 and
December 31, 1996 and $200,000.00 to be spent between January 1, 1997 and
December 31, 1997 and each year thereafter. The yearly work expenditures
qualified as fulfilling the work commitment shall be limited to all costs
incurred in actual work on the Coal Canyon Mineral prospect in drilling,
trenching, excavation, mining, road building, surveying, mapping, and
geological, geochemical and geophysical programs conducted on the Coal Canyon
Mineral Prospect as well as assaying and metallurgical testing of ores extracted
from the Coal Canyon Mineral Prospect which may be conducted at appropriate
facilities off the Coal Canyon Mineral Prospect. Expenditures shall
include wages and salaries paid to engineers, geologists, laborers and
technicians for actual time spent in exploration, development and mining of the
Coal Canyon Mineral Prospect. Direct overhead, such as lodging, meals and travel
expenses (but expressly excluding any charge for office or administrative
expenses) shall be limited to ten percent (10%) of the yearly work requirement.
Any work expenditures in excess of the work commitment in any calendar year
shall he applied to the work commitment for the following calendar year. The
said work commitments shall terminate in the event the Mineral Lease Agreement
As Amended is terminated."
7. Except as specifically amended in this Fourth Amendment, the Mineral
Lease Agreement As Amended remains in full force and effect. LESSOR and LESSEE
certify that the Mineral Lease Agreement As Amended is in good standing and in
full force and effect, LESSEE is not in default in any of the terms of the
Mineral Lease Agreement As Amended and LESSOR and LESSEE know of no
circumstances presently existing that would cause LESSEE to be in default.
8. All denominations of money in the Mineral Lease Agreement As Amended are
in United States currency.
IN WITNESS WHEREOF, the parties hereto have executed this Fourth Amendment to
the Mineral Lease Agreement as of the date first above written.
LESSEE LESSOR
GREAT BASIN EXPLORATION &
MINING CO., INC.
By Xxxxxx Xxxxxxx H. Xxxxxx Xxxxxx
----------------------------- -----------------------------
Title President Manager
13 Aug. 1996 July 31, 1996
STATE OF NEVADA }
} ss
COUNTY OF WASHOE }
The foregoing instrument was acknowledged before me on this ---- day of------ ,
1996 by ----------------------------------, ------------------ of Great Basin
Exploration & Mining Co., Inc., a Nevada corporation, on behalf of the
Corporation.
---------------------------------
My Commission Expires:
Notary Public
STATE OF NEVADA }
} ss
COUNTY OF WASHOE }
The foregoing instrument was acknowledged before me on this ---- day of -------,
1996 by H. Xxxxxx Xxxxxx who acknowledged that he executed the within instrument
for the purposes contained herein.
-----------------------------------
My Commission Expires:
Notary Public
