Laserfiche WebLink
1 ADVANCE MINIMUM ROYALTY As minimum and advance royalty, without relation to the amount of <br /> minerals mined from tite leased premises.Lessee shall pay annually in advance to Lessor the following aniounts• <br /> LEASE YEAR AMR <br /> 1999 and each year thereafter $5.00 per acre <br /> that the lease is in full force and effect <br /> If Lessee does not extract minerals from the Leased Premises sufficient to return to the Lessor the minimum <br /> amounts above specified, it is nevertheless understood that the above sums of money are due and payable to <br /> Lessor whether or not minerals are mined.but that such advance minimum royalty shall be credited upon the first <br /> royalties due as herein provided for minerals actually produced from the Leased Premises. in the absence of <br /> production of minerals in continuous paying quantities before the expiration date of the lease, all advance <br /> minimum royalties and all rentals shall be forfeited to Lessor. <br /> Acreage changes resulting from surrender or partial assignment will not reduce the advance minimum royalty. <br /> Further, at the end of each five-year period. Lessor shall increase the rate or amount of advance minimum <br /> royalty to be paid by Lessee by the rate of increase of the average Producer's Price Index for the product, or <br /> other similar product, for the previous five year period,as published by the U.S. Department of Labor, Bureau <br /> of Labor Statistics. The first such five-year period will terminate on November 1, 20(A. Failure to comply with <br /> any new advance minimurn royalty rate set by Lessor may subject this lease to cancellation by thirty day written <br /> notice by Lessor. <br /> in case of assignment of this lease,all advance minimum royalty paid to the state shall be carried forward <br /> and credited to the new assignee. <br /> 2. PRODUCTION ROYALTY — Lessor reserves as royalty, and Lessee agrees to pay to Lessor on or before the <br /> last day of each calendar month following the month of production, a production royalty for all ores bearing <br /> metalliferous minerals whatever which are trained,saved,sold and/or removed from the leased premises based on <br /> the following: <br /> Gross Mine Mouth Royalty <br /> Ten _percent( 10% )of the Gross Mine Mouth Market Value at the first point of sale Gross <br /> Market Value shall mean the value of the ore or products after extraction and at the mine. <br /> A. Pa yment. Royalty shall be due and payable on or before the last day of each calendar month during the <br /> term of this lease for ores,minerals and other materials mined and removed for sale by Lessee during the <br /> preceding calendar month. Reporting of production royalty that is credited against advanced minimum <br /> royalty is also due on or before the last day of each calendar month following mining. Payment shall be <br /> accompanied by a settlement sheet indicating the calculation of the net smelter return royalty by the <br /> lessee and stating the number of units of product sold,or deemed sold,the payment or deemed payments <br /> received and the amount of deductions. <br /> B. Pavment in Kind. Lessor may elect, upon 60 days written notice to Lessee, to receive any net smelter <br /> returns royalty due in kind by directing a refiner to deposit into a separate consignment account. in <br /> Lessor's name, an amount of refined gold or silver, equal in value to the net smelter returns royalty <br /> owed. The value of gold or silver shall be its fair market value as defined in Subsection 3(B)(9) <br /> C. Sampling. No royalty shall be due on any minerals extracted or removed from the property for the <br /> purposes of sampling,testing,analysis or evaluation in order to determine mineral values of the property, <br /> unless materials of value are sold or used <br /> Reporting of production royalty that is credited against advanced minimum royalty is due on or before the <br /> last day of each calendar month for mining during the preceding calendar month. <br /> Further, at the end of each five-year period, commencing from the original lease date, for so <br /> long as this lease remains in effect. Lessor shall increase the rate or amount of production royalty to he paid by <br /> Lessee during each year of the succeeding five-year period, by a rate of 2% of the previous year's per ton <br /> royalty rate or the rate of increase of the average Producer's Price Index for the product, or other similar <br /> product, for the previous five year period, as published by the U.S. Department of Labor, Bureau of Lahor <br /> Statistics. which ever is greater. The first such five-year period will terminate on November 17. 2(X)4. Failure <br /> to comply with any new royalty rate set by Lessor may subject this lease to cancellation by thirty-day written <br /> notice by Lessor. <br /> 3 EXTENSION--Lessee may have a preferential right to renew the lease or to receive a new lease,whichever may <br /> be determined by Lessor to be to the best interest of the State,under the following conditions: <br /> Page 2 of 8 <br />