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pursuant to subsection 3.2, subject to the conditions that Lessee shall not be in <br />default under this Lease at the time notice is . received or at the time of <br />commencement of the Extended Term and conditioned on Lessor's approval of <br />the mining pian for Pit 5 as provided in subsection 12. The Primary Tenn and the <br />Extended Term (if exercised) are together referred to in this Lease as the "Term." <br />4. Royalties and Reserves. In consideration for Lessee's rights and Lessor's obligations <br />under this Lease, Lessee shall compensate Lessor as follows: <br />4.1 Lessee shall pay a production royalty {"Royalty" or "Royalties-) to Lessor at the <br />rate of $1-00 per ton (2,000 lbs.) of Common Materials removed from the <br />Property under this Lease. <br />4.2 No production Royalty shall be payable to Lessor unless and until Common <br />Materials are taken of the Property. <br />4.3 Lessee shall provide Lessor with a monthly written statement specifying the <br />weight of all Common Materials removed by it during the preceding month and <br />shall make payments to Lessor of any Royalty due by the 20', day of each month <br />at Lessor's address stated in the introductory paragraph of this Lease, unless <br />Lessee is otherwise directed in writing by Lessor. if Lessee fails to make any <br />Royalty payment within fifteen (1 S) days after it is due, Lessee shall pay on <br />demand to Lessor interest on the unpaid amount from its due date until paid at the <br />lesser of twelve percent (12%) per annum or the maximum rate allowed by law, in <br />either case compounded annually. Imposition or payment of interest on late <br />payments will not excuse, or constitute a waiver of any remedy for, any default by <br />Lessee based upon failure to pay Royalties when due. <br />4.4 At all times from the Commencement Date until the later of termination of this <br />Lease or removal of all Common Materials from the Property under paragraph <br />1.4(a), Lessee shall maintain one or more weighing devices (for example truck <br />scales or scale devices in a concrete batch plant or asphalt hot mix plant) on the <br />Property which will be independently certified as accurate as and when required <br />by applicable governmental authorities at Lessee's expense. All Common <br />Materials removed from the Property by Lessee shall be weighed on these scales. <br />Lessee shall keep accurate and complete records of the weights of all Common <br />Materials taken off the Property by Lessee, which shall be available for review <br />(and copying at Lessor's expense) by Lessor at Lessee's address in the <br />introductory paragraph of this Lease during regular business hours. <br />4.5 Lessor retains all other minerals and mineral rights in the Property not specifically <br />granted to Lessee by this Lease. If Lessee encounters other minerals in <br />commercially paying quantities while operating under this Lease, Lessee will <br />notify Lessor. <br />5. Lessor's Warranties. Lessor warrants title to the Property, and to all Common Materials <br />located on the Property, subject to the following: all easements and rights-of-way of <br />4 <br />