Gravel Pit Lease Agreement

Exhibit 10.12

Gravel Pit Lease Agreement

        This lease and mining agreement is dated Aug. 31, 2004 (the "Lease" or "Agreement"), by and between Ready Mix, Inc., a Nevada corporation ("RMI" or "Lessee" or "Party") and Rocky Mountain Mining, LLC ("Oliver" or "Lessor" or "Party").

RECITALS

• A.

  Lessor and Lessee are parties to a Lease and Batch Plant Agreement dated June 26, 2000 ("Prior Lease").
  
  

  B.

  Oliver owns that certain gravel Pit located at 39353 North Schnepf Road, Queen Creek, Arizona as more particularly described and indicated on Exhibit A attached hereto (the "Premises").
  
  

  C.

  Lessor and Lessee have executed an Escrow Instructions agreement dated June 9, 2004 wherein Lessee intends to purchase approximately five (5) acres of land adjacent to the Premises and fronting Schnepf Road and further described as Parcel No. 2 of Exhibit A ("Land Purchase").
  
  

  D.

  Oliver desires to lease the Premises to RMI and RMI desires to lease the Premises from Oliver for the purpose of mining and processing sand and gravel and related activities on the Premises all upon the terms and conditions hereinafter set forth.
  
  

  E.

  The parties desire to enter into this Lease upon the terms and conditions hereinafter set forth.

AGREEMENTS

         NOW THEREFORE, in consideration of the foregoing and the covenants contained herein, the parties hereto agree as follows:

• 1.

  Lease.     Oliver hereby leases the Premises to RMI and RMI leases the Premises from Oliver, on the terms and conditions set forth herein.
  
  

  2.

  Prior Lease.     Immediately upon execution of this Agreement and the consummation of the Land Purchase, the Prior Lease shall be terminated in its entirety and shall cease.
  
  

  3.

  Term.     Lessor does hereby lease to Lessee the above described Premises for the period of five (5) years commencing Aug. 31, 2004 and ending Aug. 30, 2009.
  
  

  a)

  The Lessor grants the Lessee five (5) one-year extensions exercisable by the Lessee upon ninety (90) days prior written notice subject to the compliance of the specifications and conditions of Exhibit B .
  
  

  b)

  The option to extend the Lease for any additional term is subject to the specifications and conditions of Exhibit C .
  
  

  c)

  In the event that extractable materials from the Premises are depleted to the extent that continued mining is cost prohibitive prior to the expiration of this Lease, the Lessee shall give the Lessor written notice and the parties agree to renegotiate the Lease in good faith within sixty calendar days following the date written notice was given.

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• 4.

  Earnest Monies. Lessee shall pay Lessor Five Thousand Dollars ($5000) earnest monies, non-refundable, upon mutual signing of the Lease. Earnest monies will be credited against the payment of any monthly royalties due.
  
  

  5.

  Rent/Royalties. There shall only be two regular payment obligations of the Lessee: 1) Royalties, as set forth in the schedule attached hereto as Exhibit C , and 2) Non-exclusive rent for the truck scale and scalehouse which shall be charged at the rate of $200 per month for the term of the Lease, or until such time as the scales and scalehouse are no longer utilized.
  
  

  6.

  Licenses and Permits. Lessee shall obtain and keep current all necessary licenses and permits as deemed necessary by any government entity whether local, state or federal relating to conducting business on the Premises. If such licenses and/or permits were unattainable, this Lease would be in default.
  
  

  7.

  Mining Plan. Prior to commencing any mining activities, Lessee shall submit a written general mining plan ("Mining Plan") to the Lessor for Lessor's approval which approval shall not be unreasonably withheld.
  
  

  8.

  Landfill/Backfill Plan. Prior to commencing any landfill or backfill activities, Lessee shall submit a written general plan for such activities ("Landfill/Backfill Plan") to the Lessor for the Lessor's approval which approval shall not be unreasonably withheld.
  
  

  9.

  Possession and Enjoyment.
  
  

  a)

  Lessor agrees that Lessee, paying the royalties and performing the other terms and conditions of this lease, may peaceably hold and enjoy the leased Premises during the lease term without any interruption by Lessor or any other person lawfully claiming by, through or under Lessor. Lessor shall have the right, during the term of this Agreement, to enter upon the leased Premises during normal business hours for the purpose of inspection and determination of compliance with the mining specifications and conditions, or conformance to the Mining Plan or the Landfill/Backfill Plan.
  
  

  b)

  Lessee acknowledges that it has examined the Premises and knows the condition thereof and that no representations have been made as to the condition or state thereof, and Lessee accepts the Premises in its present condition.
  
  

  10.

  Business. Lessee shall use the Premises for such general uses as a sand and gravel plant site, asphalt plant site, material stockpile site, landfill/backfill, scales, sales office, customer and equipment parking and other lawful activities pertaining to the aforementioned activities.
  
  

  11.

  Use of Premises. Lessee shall at all times keep and maintain the premises in a clean, orderly and sanitary condition, and shall comply with all environmental rules and regulations. No storage or dumping of hazardous materials is permitted, unless expressly used in the operation of the sand and gravel plant or asphalt plant. Any area used for washout of concrete trucks or for proper disposal of returned concrete shall be clearly designated in the approved Landfill/Backfill Plan.
  
  

  12.

  Improvements. Lessee may at its own expense construct such buildings, structures and other improvements on the Premises as are reasonably necessary for the conduct of its business. All such permanent buildings, structures and improvements constructed by Lessee shall either become the property of the Lessor and remain on and be surrendered with the Premises as a part thereof at the termination of this Lease or at the Lessor's option must be removed at the Lessee's expense. The Lessor grants the Lessee the right to remove and recover the sand and gravel plant, the asphalt plant, other portable buildings and equipment at the termination of this Lease. Lessee agrees to maintain, at its own expense, the interior and exterior of any buildings, structures and improvements it may construct thereon in good condition and repair.

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• 13.

  Occupancy Expenses and Property Taxes. Lessee shall promptly pay when due all gas, light, heat, power, plumbing, water, and other occupancy expenses of whatsoever kind or nature, including utility deposits, connection fees and running of utilities to the Premises, and shall pay all property taxes on equipment and improvements placed on the Premises by Lessee.
  
  

  14.

  Damage to Property and Persons. All property of any kind which may be on the Premises during the term of the lease shall be at the sole risk of the Lessee; and Lessor shall not be liable to Lessee, its agents, guests, customers, employees, for any damage caused to their person or property by water, rain, snow, sleet, fire, storms and accidents, or by breakage, stoppage or leaking of water, gas, electricity, heating, sewer pipes or plumbing on, about or adjacent to the Premises; and in the event of any breakage, stoppage or leakage, Lessee shall promptly remedy the same at its expense.
  
  

  15.

  Insurance. Lessee shall provide and obtain and maintain in full force during the leased term, for the benefit of both parties hereto, as their respective interests may appear, liability insurance in a company satisfactory to Lessor, general liability insurance in the minimum amount of One Million Dollars ($1,000,000) with the respect to injuries to any one person. Two Million Dollars ($2,000,000) with respect to injuries in any one accident and One Million Dollars ($1,000,000) with respect to any property damage. RMI, shall have Oliver listed as an additional injured on all insurance policies and shall furnish certificates evidencing the existence of all policies to Oliver as and when reasonably requested by Oliver.
  
  

  16.

  Indemnity. Lessee shall indemnify and save harmless Lessor from and against any and all claims, liability, penalties, damages, expenses and judgments for injuries or accidents to persons or property, in connectio