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6. Royalties and Extensions. <br />a. Sand and Gravel Royalties. During the initial five (5) ears of <br />the Tcrut, the Lcsscc shall pay the LCasur a suyalty of (1) �on all <br />sand and gravel that was both removed and sold during the erm o this Agreement (the, <br />"Sand and Gravel Royalties"). Quarterly payments shall be made on the 15th day of the <br />next succeeding month following the end of the applicable quarter for all sand and gravel <br />that was both removed and sold during the preceding calendar quarter. For the second five <br />(5) years of the Term, the Sand and Gravel Royalties shall be increased to a flat rate for <br />such five (5) year period at the prevailing market rate for such sand and gravel operations <br />in southeastern Colorado; provided, however, in no event <br />Royalties for the second five (5) years of the Term exceed <br />Concerning the five (5) year renewals of the original Term as prove*in*section 6.d, <br />below, the Sand and Gravel Royalties payable during each five (5) year renewal may be <br />increased by Lessor giving written notice not less than one hundred eighty (180) days <br />before the commencement of any such five (5) year renewal term, and providing <br />documentation reflecting adjustment of the Sand and Gravel Royalties by the percentage <br />of increase or decrease in the cost of living index as established by the Consumer Price <br />Index for Urban Wage Earners and Clerical Workers published by the Bureau of Labor <br />Statistics of the U.S. Department of Labor or equivalent of any such index published by <br />the U.S. Government (or any revision of said indices) which has occurred from date of this <br />instrument to the date of adjustment; provided, however, that in no event shall the Sand <br />and Gravel Royalties during any such renewal Term be either (a) less than the <br />considerat' iginal ten (10) year Term of this Lease; or (b) <br />more than Notwithstanding the above, at any time and <br />from time -to -time, essee Mmay a ect to report and make royalty payments on a monthly, <br />instead of quarterly, basis to Lessor. Only in extreme cases when waiting for payment <br />from a contractor can Leone Sand & Gravel LLC ask to extend payment period. <br />b. Gold Royalties. If the Lessee, in its sole discretion, <br />determines that the benefit to the Lessee of such recovery will exceed the cost of such <br />recovery, the Lessee shall take measures to recover and separate gold from the materials <br />mined from the Premises. If at any time the Lessee takes such measures, 25% of the net <br />amount realized by the Lessee during the preceding calendar month after the expenses and <br />costs of separation and recovery (including any share allowed or paid to any third party <br />unrelated to the Lessee for effecting the separation and recovery) shall be paid over to the <br />Lessor in addition to the Sand and Gravel Royalties. Such amounts, if any, shall <br />hereinafter be referred to as the "Gold Royalties." <br />C. Royalties. The Sand and Gravel Royalties and the Gold <br />Royalties shall be collectively referred to as the "Royalties." <br />d. Renewals/Extensions. Unless sooner terminated as provided <br />herein, at the expiration of the initial 10 year term, and at the expiration of any subsequent <br />extension, this Lease shall automatically renew for successive five (5) year terms on the <br />same terms and conditions set forth herein (except for price per ton described in paragraph <br />6.a., above). Notwithstanding the foregoing, if (i) Lessee determines in Lessee's sole <br />