Exhibit 10.35
MINING LEASE WITH
OPTION TO PURCHASE
THIS MINING LEASE WITH OPTION TO PURCHASE is made this 9
th day of October, 2004 by and between TAMMY GENTRY,
a single woman, and PAT HANIGAN, a single man (referred to
collectively as "Owner"); and NEVADA SUN RISE, LLC, a Nevada
limited liability company ("Lessee").
RECITALS
A. Owner owns and possesses one (1) patented lode mining claim
situated in the Santa Fe Mining District, Mineral County, Nevada
and more particularly described as follows:
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Claim Name
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Mineral Survey No.
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Patent No.
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Copper Queen
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4514
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891083
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The foregoing claim is situated in Section 31, T. 8 N., R. 35
E., MDM. This patented mining claim, together with all ores,
minerals, surface and mineral rights, and the right to explore for,
mine, and remove the same, and all water rights and improvements,
easements, licenses, rights-of-way and other interests appurtenant
thereto, shall be referred to as the "Property."
B. The parties now desire to enter into an agreement
giving Lessee the exclusive right to explore, develop, and mine the
Property, and further granting to Lessee the exclusive right and
option to purchase the Property.
THEREFORE, the parties have agreed as follows:
-1-
SECTION ONE
Lease Term and Royalties
1.1 Term of Lease . Owner hereby leases the
Property to Lessee for a term of nine (9) years. The Effective Date
of this Agreement will be October 9 th , 2004,
and all rights and obligations shall be calculated on the basis of
that date.
1.2 Lease and Option Payments . In order to
maintain the Lease and Option in effect, Lessee shall make the
following payments to Owner:
a. Lessee has previously
paid Owner the sum of ONE THOUSAND DOLLARS ($1,000.00) to hold the
Property from August 1,2004 to September 30, 2004.
b. Commencing on October
1,2004, and payable every three months thereafter ( i.e., on
January 1, April 1, July 1, and October 1 of each year) for so long
as this Agreement remains in effect, Lessee shall pay Owner the sum
of ONE THOUSAND FIVE HUNDRED DOLLARS ($1,500.00) to hold the
Property for the ensuing quarter.
1.3 Option to Purchase . Owner grants to
Lessee the exclusive right and option to purchase the Property for
FIFTY THOUSAND DOLLARS ($50,000.00). This represents a purchase
price of approximately $2,500.00 per acre. All payments previously
made to Owner pursuant to Section 1.2 above shall be applied to the
purchase price. Lessee shall have the right to exercise this option
and purchase the Property at any time during the nine-year term of
this Lease.
-2-
Under no circumstance may Lessee place the Property into
production without paying Owner the purchase price in full.
Upon receiving written notice from Lessee that it will purchase
the Property and pay the balance of the purchase price, Owner shalt
execute a Quitclaim Deed conveying the Property to Lessee. Owner
shall deposit the Deed into escrow with a mutually acceptable
escrow agent, and Lessee shall deposit the balance of the purchase
price with the escrow agent. Escrow shall close within thirty (30)
days of Lessee's notice to Owner. Each party shall bear one-half of
the escrow costs.
1.4 Delivery of Data . Upon execution of
this Agreement, Owner shall make available to Lessee copies of all
maps, deeds, and other documents in Owner's possession which
pertain to the claim title and boundaries, prior workings,
production history, and so forth. Lessee shall have the right to
copy any or all of these documents at its expense. Lessee shall
also have the right to inspect and assay drill core, chip trays,
drill cuttings, and other physical samples from the Property in
Owner's possession.
SECTION TWO
Mining Operations
2.1 Right to Explore, Develop and Mine .
Following execution of this Agreement, Lessee shall have the right
to make geological investigations and surveys, to drill on the
Property by any means, and to have all the rights and privileges
incident to ownership of the Property, except that Lessee may not
commence mining operations on the Property without first paying the
purchase price pursuant to Section 1.3 above.
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2.2 Conduct of Work . Lessee shall perform
ins exploration activities on Property in accordance with good
mining practice, shall comply with the applicable laws and
regulations relating to the performance of exploration operations
on the Property, and shall comply with the applicable worker's
compensation laws of the State of Nevada.
2.3 Liability and Insurance . During the
term of the Agreement, Lessee shall indemnify and hold Owner
harmless from any claims, demands, liabilities or liens arising out
of Lessee's activities on the Property. To that end, Lessee shall
immediately obtain and carry a policy of public liability insurance
in the amount of $1,000,000 or more for personal injury and
$100,000.00 for property damage, protecting Owner against any
claims for injury to persons or damage to property resulting from
Lessee's operations. Lessee shall provide Owner with a certificate
of insurance evidencing such insurance.
2.4 Liens . Lessee shall keep the Property
free and clear from any and all mechanics' or laborers' liens
arising from labor performed on or material furnished to the
Property at Lessee's request. However, a lien on the Property shall
not constitute a default if Lessee, in good faith, disputes the
validity of the claim, in which event the existence of the lien
shall constitute a default thirty (30) days after the validity of
the lien has been adjudicated adversely to Lessee.
2.5 Installation . Lessee may install,
maintain, replace, and remove during the term of this Agreement any
and all mining machinery, equipment, tools, and facilities which it
may desire to use in connection with its mining activities on the
Property. Upon termination of this Agreement for any reason, Lessee
shall have
