HomeMy WebLinkAbout871872.tiff Michael C. Huseby
Certified Professional Landman First Interstate Tower South
1 nd Gas Properties 621 17th Street,Suite 915
Denver,Colorado 80293
June 17, 1987 Office (303)296-0707
Mr. and Mrs. Raymond D. Bivens
Keota Star Route 17
Grover, Colorado 80729
Dear Mr. and Mrs. Bivens:
I have enclosed two copies each of a mining lease covering the lands owned
in fee by you personally and those you control which are owned by the
Town of Keota. I have discussed the situation regarding the previous lease
with the managers at Ferret and they have determined that we should have
the new leases take effect upon the expiration date of the current leases. By
doing this we do not have to make a determination of the validity of the
previous leases. Therefor, you can execute the new leases and 4eposit the
funds immediately and the leases will take effect in February and April of
next year. We will be able to proceed with our plans with your eticuted
leases.
When you execute the lease please be sure to initial the changes where the
deletions have been made on the front of the lease. Please deposit the leases
along with the bank drafts in your bank and we will credit your account
when we receive notification that the draft has been received.
I have included a letter signed by Ralph Barnard which will relieve you of
any legal costs in connection with Ferret's operations.
Thank you for leasing and I apologize for the delay in sending this along but
the Ferret managers have been travelling extensively and have been
unavailable to approve the transaction. If you have questions or comments,
please call collect to 758-5125.
Sincerely,
ichael C. Huseby
�r
cnnr
Ferret
Exploration
Company.Inc.
•
Suite 300 •
STelephone: (303)294-0427
1800 Glenarm Place June 17, 1987 Telecopy: (303). 293-2235
Denver,Colorado 80202 Telex: 4-5527
Mr. and Mrs. Raymond D. Bivens
Keota Star Route 17
Grover, Colorado 80729
Re: Mining Leases
Town of Keota
Townsite Leases
Dear Mr. and Mrs. Bivens:
This letter will confirm that Ferret Exploration.Company, Inc. ("Ferret")with
offices at 1800 Glenarm Place, #300, Denver, Colorado 80202, agrees to pay
any legal costs or related expenses arising out of their agreement to lease to
Ferret the Keota townsite tracts owned by them in fee simple or as public
officials under the tracts owned by the Town of Keota.
Ferret agrees to execute additional documents as shall be required to effect
this agreement. Thank you for agreeing to lease and for helping Ferret move
this project forward.
Sincerely,
, ...
Ralph Barnard
Vice-President, Exploration
Ferret Exploration Company, Inc.
.__
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MINING LEASE .
THIS LEASE is made and entered into on June 1 19 87• by and between
Town of Keota, Colorado : Raymond D . Biverls . Mayor
Keota Star Route 17 . Grover, Colorado 80729
hereinafter called "Lessor",and Ferret Exploration
Company. Inc . . a Delaware Corporation. 1800 Glenarm Place . Suite 300 .
Denver. Colorado 80202 hereinafter called"Lessee."
W ITN ESSETH:
1. Interests Leased. For and in consideration of the sum of Ten or more dollars paid to Lessor by Lessee, the receipt and sufficiency of which is
hereby acknowledged by Lessor,the royalty herein reserved, and the mutual covenants hereinafter set forth, Lessor hereby grants, leases, and lets exclusively
unto Lessee,all uranium, vanadium, other fissionable source materials and other spatially associated minerals, which leased minerals and mineral deposits are
hereinafter called the "Subject Minerals", under the land described herein together with all interests hereafter acquired by Lessor in such lands (which lands
are hereinafter called the "Leased Premises"),and together with the right and privilege to enter upon the Leased Premises for the purposes of surveying, ex-
ploring, prospecting, drilling for, developing, mining, (including surface open pit mining, solution and underground mining) stockpiling, removing, shipping,
and marketing any of the Subject Minerals;to construct and use buildings,roads,power and communication lines and other improvements reasonably required
by Lessee for the full enjoyment of the Leased Premises;to use so much of the surface of the Leased Premises in such manner as may be reasonably necessary,
convenient, or suitable for or incidental to any of the rights or privileges of Lessee hereunder or otherwise reasonably necessary to effect the purpose of this
lease;and together with easements in all rights of way for ingress and egress to and from the Leased Premises to which Lessor may be entitled: To the following
described land situated in Weld County,State of Colorado to-wit:
Township 9 North , Range 60 West -^
Section 34-, Town of Kenta
Mork 9 : east z of tha north a
Rlnnk 10 : west z of the north z
Plonk 27 : All
All tha Streets & Allays on First Edition Pint, filed October 23 , 1918
SUBJECT ONLY TO: existing leases,rights and encumbrances of record;the right of Lessor to use,lease and convey the surface of the Leased Premises
subject to the rights granted to Lessee hereby;and the right of Lessor to develop,explore,produce or lease for development,production of oil,gas,and associa-
ted liquid hydrocarbons and coal in and under the Leased Premises insofar as the same may be developed,explored or produced without materially interferring
with Lessee's operations under the terms hereof. April 20, 1988
2. Term of Lease. The term of this lease is ten (10) years from .F.de- - €and so long thereafter as any of the Subject Minerals are produced
from the Leased Premises, provided, that, for any period when there is no reasonable market for such of the Subject Minerals as are developed by Lessee on the
Leased Premises, the term of this lease shall continue during such period despite a lack of production of any of the Subject ner s on the Leased Premises,
if,during such period,the annual delay rental payments required by paragraph 3 hereof shall be made. f18
Bank of ,ei successor, the sum of$1.00 per acre as delay_
rental, or minimum royalty, the same to be reduced b a ties received by Lessor for production from the Leased Premises during the -.
preceding lease year an e y essee for purposes authorized in paragraph 12 hereof and not theretofore recovered by Lessee from pay-
This is a paid-up lease . -
4. Royalties.The royalties to be paid by Lessee are:
(a) For all uranium bearing ores produced from said Leased Land which are saved and sold by Lessee in the form of Lf308-(yellowcakel,following
processing or beneficiation,drying and packing, a royalty of three percent of the proceeds received by Lessee from the sale of suck U308,after first deducting
from such proceeds (if not already deducted by purchaser and reflected in the proceeds received by Lessee) any costs incurred'by\Lessee-for transportation
of such U308 from the processing plant to the point of sale,brokerage costs,and less deductions made by purchaser for sampling,assaying and penalties;
(b) For all uranium bearing ores produced from said Leased Land which are saved and sold by Lessee in raw crude forin,,a royalty of five percent
of the proceeds received by Lessee from the sale of such raw crude ores, after first deducting from such proceeds (if not already deducted by purchaser and
reflected in the proceeds received by Lessee) any costs incurred by Lessee for transportation of such raw crude ores from the;Leased Land to the point of-'-"
sale,brokerage costs and less deductions made by purchaser for sampling,assaying and penalties; - `
(d) For all Leased Substances other than uranium bearing ores produced from said Leased Lands which are saved and sold by Lessee; a royalty of
five percent of the proceeds received by Lessee from the sale of such Leased Substances, regardless of the form in which they are sold;after first deducting _
from such proceeds (if not already deducted by purchaser and reflected in the proceeds received by Lessee) any cost incurred by Lessee in-the processing or
beneficiation of such Leased Substances, costs of transportation of such Leased Substances from the Leased Land to the point of sale, brokerage costs, and
less deductions made by purchaser for sampling,assaying and penalties;
The mineral content of all ore mined and removed from the Leased Premises shall be determined by Lessee,or by the mill or smelter to which the ore
is shipped, in accordance with standard sampling and analysis procedures. Upon request to Lessee,and at Lessor's expense, Lessor shall have the right to have
a representative present at the time samples are taken.
In the event Lessee mills the ore from the Leased Premises, Lessor shall be furnished, at Lessor's request and at no expense,a portion of all or any
samples taken for analysis. In that event, split samples shall be retained by Lessee for later analysis by an independent referee, and, in the event of a dispute —
concerning Lessee's assay of samples, royalty payments shall be based on the assay results of the independent referee selected by agreement of the parties.
The cost of the referee shall be paid by the party whose assay shows the greatest variance from that of the referee.
All residue or tailings remaining after the initial processing or milling of the crude ores mined from the Leased Premises shall be the sole and exclusive
property of Lessee.The Lessee agrees to dispose of such residue or tailings in accordance with all NRC and EPA regulations and standards.
5. Maintenance of Operations.Lessee agrees to maintain all roads,camps,and drillsites.
6. No Drillsite Near Dwelling House. No drillsite shall be located within 200 feet of any existing well or dwelling house unless the permission of
Lessor is first had and obtained.
7. Limitation of Exploratory Work. No work shall be done by Lessee during exploratory operations that may interfere with feeding of livestock
unless the permission of Lessor is first had and obtained.
8. Sheep-Tight Fences. Lessee agrees to enclose with livestock-tight fence any excavations dangerous to livestock that it may make in the course of
its mining operations.
9. Maintenance of Fences. The Lessee agrees not to keep fences down at any point,to repair promptly any road damage done by vehicles and equip-
ment of Lessee and to erect gates or cattleguards in all fences in which openings may be made for ore haulage.
10. Payment for Exploratory Holes. Lessee agrees to pay to Lessor the sum of Twenty-Five Dollars($25.00) for each exploration test hole drilled on
the Leased Premises as compensation for damages to grass and land from such operations, up to a maximum of Twenty-Five Dollars($25.00)per acre for the
entire life of this lease.
11. Payment for Surface Damage. When Lessee requires utilization of surface rights for the operation of this lease, Lessee may appropriate such part
of the surface as it requires, and upon execution of a Quit Claim Deed by Lessor, his successors or assigns,to Lessee covering such part of the surface, Lessee
shall pay to Lessor,his successors or assigns,an amount equal to 125%of the then current market value of said surface area acquired. In determining the current
market value,the parties agree that it shall be based upon the most recent sale of comparable real estate in the vicinity,or, in the event that such evidence is
not available, or if the parties cannot agree, the consideration shall be determined by three disinterested residents of the county, one to be selected by the
Lessor, one by the Lessee, and the third by the two selected herein.All surface rights acquired by this method shall be conveyed by Lessee to Lessor,his heirs,
successors or assigns, upon expiration of said lease; PROVIDED, HOWEVER, this shall not preclude Lessee from purchasing a fee simple or lesser estate in
land without such obligation to reconvey. If any of Lessee's operations hereunder on land not conveyed by Lessor to Lessee result in damage to buildings,
land, personal property,growing crops or timber, Lessee shall reimburse the owner for the reasonable value of the same.The Lessee will also•guarantee access
to all other lands of the Lessor. In the event access is not available, Lessee will compensate Lessor at 125%of the appraised value of said land not available to
Lessor.
_ _ __12. Lesser Interest. In the event Lessor owns an interest in the Subject Minerals,which is less than the entire and undivided mineral estate therein,
whether or not such'lesser mineral interest if'ref erred-t oil erein;then-the-royalties-and-delay-rentals-herein provided.for shall_be.paid_to_Lessor only in_the.
proportion that Lessor's interest therein bears to the whole and undivided mineral estate. This paragraph shall apply with equal force and effect to reduce"
payments pursuant to paragraph 10 herein when Lessor owns a lesser interest in the surface estate than the entire and undivided fee simple interest therein.
Notwithstanding any other provisions of this lease,with respect to that portion,if any,of the Leased Premises in which Lessor owns no right,title,or interest in
the Subject Minerals, Lessee is under no obligation to pay,and Lessor has no igh o ceive,delay rentals or royalty production. py7�
13. Warranty. Lessor freaky"a'ee'" "id-^gyres to de'en9 the to t -ac^d o.e...rcrt, anrr agrees that Lessee, at its option, may pay and dis-849
charge any taxes,mortgages,or other liens existing,levied or assessed on or a i st the Leased Premises;may be subrogated to the rights of any holder or holders
thereof;and may reimburse itself for any such expenditures out of any royalty or rental thereafter accruing to Lessor.
14. Exploration and Mining Operations. The Lessee may use and employ methods of exploration and mining as it may desire or find most profitable
and economical and may, when it deems it necessary or desirable,discontinue operations entirely so long as it shall well and truly meet its obligations here-
under to pay rental and royalty due,if any;provided that Lessee shall not be required to mine,preserve,or protect in its mining operations any Subject Minerals
which under good mining practices cannot be mined or shipped at a profit to the Lessee at the time encountered. Lessee shall have the right and privilege at any
time, during the term of this lease and so long thereafter as it may hold an interest in the minerals hereunder to use any and all roads or workings located at any
time on or under the Leased Premises and Lessee shall have the further right of mixing,either underground or at the surface or processing plant,any ores,solu-
tions or other products (herein called "Products") containing Subject Minerals and produced from the Leased Premises or any portion thereof with Products
from any other lands, provided that the mixing is accomplished only after the Products have been sampled and after the weight or volume thereof has been
determined or ascertained by sound engineering principles. An accurate record of the tonnage or volume of Products and of the analysis of Products from each
property going into such mixture shall be kept and made available to Lessor at all reasonable times. The tonnage or volume of Products from each property,
together with the analysis thereof, shall be used as the basis of the allocation between the properties of production royalties paid from such Products.All lands
will be reclaimed to prior condition.
15. Assignment. The estate of either party may be assigned in whole or in part;provided that no change in the ownership of the Leased Premises or
assignment of royalties payable hereunder shall be binding upon Lessee until Lessee has been furnished with a written transferor assignment or a certified copy
thereof. In the event this mining lease shall be assigned as to a part of parts of the Leased Premises and the Lessee,or asignee or assigness of any part or parts,
shall fail or make default in the payment of the proportionate part of the royalties due from him or them or otherwise breach any covenants contained herein,
such default shall not operate to defeat or affect this lease insofar as it covers any other part or parts of the Leased Premises.An Assignment of this lease shall,
to the extent of such assignment,relieve and discharge the Lessee of all obligations hereunder which have not theretofore become due.
16. Inspection. Lessor or its duly appointed representative shall have the right,exercisable at all reasonable times and in a reasonable manner so as not
to interfere with the Lessee's operations,to go upon the Leased Premises,or any part thereof,for the purpose of inspecting the workings thereon. Lessor shall
hold Lessee harmless from all claims for damages arising out of any death,personal injury,or property damage sustained by Lessor or Lessor's agents or servants
while in or upon the Leased Premises as herein permitted,unless such death or injury arises as a result of negligence of the Lessee.
17. Multiple Lessors.Whenever four or more parties are entitled to receive delay rentals or royalties hereunder, Lessee may withhold payment thereof
unless and until all such parties designate in a recordable instrument an agent empowered to receive all rental or royalty payments due hereunder and to execute
division and transfer orders on behalf of said parties and their respective successors in title. -
18. Taxes. Lessor agrees to pay all general ad valorem taxes and assessments assessed against the Leased Premises and all taxes resulting from the
Lessor's use thereof; provided that Lessee shall pay for that portion of such taxes which is attributable to any producing mine opened and operated on the
Leased Premises by Lessee, less the part thereof attributable to Lessor's royalty interest therein. Lessee shall pay all other lawful public taxes and assessments,
whether general, specific or otherwise, assessed and levied upon or against the Leased Premises attributable to Lessee's operations,or upon any ores and other
products thereof,or upon any property or improvements placed by Lessee on the Leased Premises;provided that if any tax is now or hereafter levied on or mea-
sured by production, Lessor shall pay that portion of such taxes which is attributable to the royalty reserved herein. Lessee shall have the right in good faith
to contest any of the above taxes,whether payable by Lessee or payable by Lessor, but shall not permit or suffer the Leased Premises or any part thereof,or
any ore mined thereon,or any improvements or personal property thereon to be sold at any time for such taxes or assessments.
19. Default; Force Majeure;Termination. If at any time Lessee shall be in default in the performance of the terms and conditions of this lease to be
performed by it, provided such default is not caused by casualties,strikes,legislation,public regulations,storms,floods,acts of God,civil or military disorders,
insurrection, riots, fire,accident, explosion, or other causes beyond the control of Lessee,and if,within 90 days after written notice of such default if given by
Lessor to Lessee, Lessee has not commenced activities which will cure the default if pursued diligently,then Lessor may terminate this lease by notice to Lessee;
provided that,for any default in the payment of money, Lessor may terminate this lease by notice to Lessee if such default is not cured within 30 days after
such written notice of default.Any notice contemplated to be given herein shall be sufficiently given if mailed in the United States Post Office,postage prepaid,
and certified; if to Lessee, addressed to Lessee at Lessee's address shown above,and if to Lessor addressed to Lessor at Lessor's address shown above,or at such
other address as may be designated by the respective parties in writing. If this lease is surrendered or terminated for any cause, Lessee shall have one year after
the effective date of such surrender or termination in which to remove all engines, tools, machinery, buildings, structures, headframes,trailers, ore stockpiles
and all other property of every nature and description erected,placed or situated on the Leased Premises by it. Upon such termination Lessee shall close off and
plug any open shaft to such extent that such shaft shall not thereafter be a hazard to persons or livestock using the surface of the leased premises.
20. Further Documents and Records.At the request and expense of Lessee, Lessor shall deliver to Lessee for the purpose of copying the same,any
documents, abstracts, policies, or other information relating to the Leased Premises or Lessee's operations hereunder, and shall execute and deliver to Lessee
any instructions, agreements, documents, or other papers reasonbly required by Lessee to effect the purpose of this lease. Lessor shall at all times cooperate
with Lessee in any reasonable way to assist Lessee in the effecting of the purpose of this Lease.The Lessee agrees to furnish to the Lessor exploration data once
a year (either at the end of the lease year or upon the termination of the lease) Exploration Data which has been compiled by the Lessee (including maps,
surveys,and drilling data).
In addition,the Lessor shall have the right,at reasonable times,to inspection and the right to be present at all sampling,weighing and analyzing sessions.
21. Indemnification. The Lessee agrees to indemnify the Lessor for damages caused by the Lessee due to the negligence of the Lessee or its employees
or agents in its mining operations. The Lessee further agrees to indemnify the Lessor for any contamination of the Lessee's water supply as a result of solution
mining.
In addition,the Lessee agrees to compensate the Lessor for any personal injuries to the Lessor,his agents,or employees due to the Lessees'negligence
as well as property damage occasioned by the Lessee's negligent acts.The Lessee will be responsible for all claims arising out of workmen's compensation laws of
the State of Colorado for which it is liable.
22. Surrender. Lessee may at any time execute and deliver to Lessor,or place of record,a release or releases covering all or any portion or portions of
the Leased Premises and thereby surrender this Lease as to all or such portion or portions and,from and after the date of such release,thereby terminate all
obligations,including a proportionate amount of delay rentals,as to acreage surrendered except obligations accrued as of the day of the surrender.
23. Binding Effect.This lease shall be binding on the parties hereto,and upon their heirs,successors and assigns.
IN WITNESS WHEREOF,this instrument is executed effective as of the day and year first above written.
This is a top lease which will take effect upon termination of the current lease of record.
i.
(SEAL)
Betty-Bivens; Keota Town Clerk Raymond 1). Rivens , Mayor (SEAL)
of Kanto , nol nrado (BEAU
�� (� ^ (SEAL)
_ '
�M EAU
STATE OF 06--Q ) Oklahoma, Kansas, New Mexico,Wyoming,Montana,Colorado,Utah
1 ss. Nebraska, North Dakota,South Dakota
COUNTY OF /` ) ACKNOWLEDGMENT�—/INDIVIDUAL
§1�1FORE ME,the undersigned,a Notary,PJublic, in and for said County and State,on this r,( Y'/L
-- day of uA� , 19J� 7 ,personally appeared
and lJL/'t.' ___I c
J to me known to be the identical person S ,described in and who executed the
within and foregoing instrument of writing and acknowledged to me that-IA ce- duly executed the same as 2V e---e--19— free and voluntary
act and deed for the uses and purposes therein set forth. l
IN WITNESS WHEREOF,I/ I have hereunto set my hand and affixed my notarial seal the day and year last above written.
My Commission Expires A, 9, Gq 90
Notary Public
v �dA //
State of I ACKNOWLEDGMENT(For use by Corporation)
ss.
County of
On this day of ,A. D. 19 ,before me personally appeared
,to me personally known, who, being by_me duly_sw_ orp
did say that lie is the of
end that the seal affixed to said instrument is the corporate seal of said corporation
and that said instrument was signed and sealed in behalf of said corporation by authority of its Board of Directors,and said
acknowledged said instrument to be the free act and deed of said corporation.
Witness my hand and seal this day of ,A.D. 19
(SEAL)
Notary Public
My Commission Expires
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