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MINERAL LEASE AGREEMENT

Oil or Gas Lease Agreement

MINERAL LEASE AGREEMENT | Document Parties: Lewis Family Trust | Ready Mix, Inc You are currently viewing:
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Lewis Family Trust | Ready Mix, Inc

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Title: MINERAL LEASE AGREEMENT
Governing Law: Nevada     Date: 2/11/2005
Industry: Construction - Raw Materials     Sector: Capital Goods

MINERAL LEASE AGREEMENT, Parties: lewis family trust , ready mix  inc
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Exhibit 10.10


MINERAL LEASE AGREEMENT

        THIS LEASE AGREEMENT is made and entered into as of the 1st day of March, 1999, by and between The Lewis Family Trust (the "Lessor"), and Ready Mix, Inc., an Nevada corporation (the "Lessee").

  • RECITALS:

        Lessor is the owner of certain real property located at Glendale, Nevada, more particularly described in Section 1.1.

        Lessee is engaged in the business of extracting, processing and selling sand, gravel and rock for use in highway construction and for other applications.

        Lessor is willing to sell and Lessee wishes to purchase sand, gravel and rock on a royalty basis, and to lease the real property hereinafter described for that purpose.

  • AGREEMENT:

        NOW, THEREFORE, in consideration of the covenants in this Lease, Lessor and Lessee agree as follows:

ARTICLE I
Premises and Term

         1.1     The Premises.     Lessor leases to Lessee, and Lessee leases from Lessor, for the purposes set forth herein, the following described real property (the "Premises"):

    • Southwest quarter of the Southeast quarter of Section 2, Township 15 South, Range 66 East.

         1.2     Term of Lease.     The term of this Lease shall be for ten years, commencing on January 1, 1999 (the "Effective Date"), and terminating on January 1, 2009, subject to the option to extend set forth in section 11.1, and also subject to earlier termination, as set forth in Section 1.3 and Section 12.2.

         1.3     Lessee's Right of Termination.     Lessee shall have the right to terminate this Lease at any time, by giving written notice to Lessor at least ninety days prior to the termination date.

ARTICLE II
Use of Premises

         2.1     Use by Lessee.     Lessee shall use the Premises for the purpose of conducting a sand, rock and gravel mining operation, and for the processing and manufacturing of products utilizing the sand, rock or gravel so mined or quarried, and for any other purposes reasonably related thereto. Lessee shall be entitled to operate and maintain a wash plant, an asphalt plant, a concrete plant, rock separators, crushers, elevators, truck scales and any other equipment reasonably related to Lessee's extraction, processing or manufacturing process and may also maintain an office or house employees or agents upon the Premises. Lessee shall use the Premises for no other purposes.

         2.2     Valuable Mineral or Precious Metals.     Lessee shall be entitled to any valuable minerals or precious metals found on the Premises. Lessee shall be entitled to remove said valuable minerals or precious metals; provided, however, that Lessee shall pay to Lessor, as a royalty, a sum equal to five percent of net smelter returns generated from any valuable minerals or precious metals removed from the Premises.


 


ARTICLE III
Royalties

         3.1     Amount of Royalties.     Lessee shall pay to Lessor a royalty, as provided in this Section, for all sand, rock and other material ("material") removed from the Premises. The amount of material removed shall be determined from the weight of the material loaded into trucks leaving the Premises. All material so removed shall be weighed over scales provided and operated by Lessee. During the first 3 years, the royalties shall be $0.50 per ton, and during each subsequent year the royalties shall be increased by an amount to be determined by the sand and gravel index published by the US Department of Commerce. The term "year", as used herein means a period of twelve months commencing with the Effective Date of this Lease and each twelve-month period commencing on the anniversary of the Effective Date.

         3.2     Payment of Royalties.     Royalties shall be calculated on a calendar month basis and shall be due and payable in full on or before the 30 th day of the next succeeding calendar month.

         3.3     Reporting.     With each monthly payment, Lessee shall deliver to Lessor a monthly report showing the quantity of material removed during the preceding calendar month, including copies of weight tickets and load records for any un-weighed material. Lessee shall keep a strict and accurate record of all material removed from the Premises and Lessor shall have the right at reasonable times to examine mining procedures or examine the records of Lessee, including record of sales, for the purpose of verifying the amount of material removed. For those months in which no material is removed, a report shall nevertheless be delivered to Lessor, reporting the lack of activity.

         3.4     Late Payments.     If any royalty payments are not paid when due, the amount of such delinquent royalty payment shall bear interest at the rate of Twelve Percent (12%) per annum from the due date, until paid.

ARTICLE IV
Property Taxes

         4.2     Personal Property Taxes.     Lessee shall be responsible for, and shall pay, before the same become delinquent, all such taxes as my be levied or assessed upon Lessee's equipment, or any structures that Lessee shall place upon the Premises and upon any material extracted or stacked upon the Premises.

ARTICLE V
Liens

         5.1     Protection from Liens.     Lessee shall pay all expenses incurred by it in its operations on the Premises and shall allow no liens upon the Premises arising from acts of Lessee.

ARTICLE VI
Indemnification

         6.1     Indemnification by Lessee.     During the entire term of this Lease, Lessee agrees to defend, protect, indemnify and hold the Lessor, its directors, officers and employees, harmless from and against all liabilities, losses, damages, costs, expenses (including, without limitation, legal fees and expenses), causes of action, suits, claims, demands and judgements of every kind, character and nature whatsoever directly or indirectly arising out of, or in connection with, any alleged act or omission of Lessee or any person claiming under, by or through Lessee relating to the exercise or non-exercise by Lessee or its rights and obligations under this Lease including, but not limited to, the following: (i) any injury to or death of any person or damage to any property; (ii) violation of any covenant or condition of this Lease; (iii) violation by Lessee of any contract, agreement or restriction relating to the Premises; and (iv) violation of any law, ordinance or regulation affecting the Premises or any part thereof or the ownership, occupancy or use thereof.


 

         6.2     Liability Insurance.     During the entire term of this Lease, Lessee shall cause to be written and maintained a policy or policies of general public liability insurance. The policy or policies shall insure Lessee against claims and demands made by any person or persons for injuries sustained or property damaged in connection with Lessee's operations on the Premises and for any other risk insured against by such policies. Such policy or policies shall be written with limits not less than $1,000,000 for damages incurred or claimed for bodily injury or death, or otherwise, plus $500,000 for damages to property. All such policies shall name Lessee and Lessor, as their respective interests may appear, as Additional Insured. Lessee shall promptly deliver a certificate of insurance indicating the above referenced coverage and limits.

ARTICLE VII
Environment. Health and Safety

         7.1     Agreement to Comply.     Lessee shall conduct its activities on and adjacent to the Premises at all times so as to be in compliance with Environmental Regulations during the term of this Lease. Without limiting the generality of the preceding sentence, Lessee will obtain and shall be in compliance with all of the terms and conditions of all permits, licenses and other authorizations which are required under, and shall comply with all other limitations, restrictions, conditions, standards, prohibition, requirements, obligations, schedules and time tables which are contained in all Environmental Regulations.

         7.2     Notification.     Lessee shall immediately notify Lessor of any correspondence or communication from any governmental agency regarding the application of Environmental Regulations to the Premises or to Lessee's operations upon the Premises.

         7.3     Indemnification by Lessee.     Lessee shall indemnify and hold Lessor harmless from and against any action, suit, proceeding, hearing, investigation, charge, complaint, claim or demand (including, without limitation, legal fees and expenses), which many be asserted aga


 
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