PERMFILE112732

• Permit No: M2001090
• IBM Index Class Name: Permit File
• Doc Date: 9/6/2002
• Doc Name: Lease Agreement
• From: Western Mobile Northern Inc.
• To: DMG
• Section_Exhibit Name: Permit
• Media Type: D
• Archive: No

3.6 Continuation of Plants. After the removal of the sand and gravel
crushing and screening equipment from the Property, the Lessee will be allowed
to keep on and continue operating the concrete and asphalt plants on the
Property for a maximum of twelve (12) months, unless there is a mutually agreed
upon lease executed by the Owner and Lessee for the continued operation of the
plants.
9. Royalty Payments.
4.1. Initial Royalty Rate. Subject to the provisions of Paragraphs 4.5 and
4.6 below, Lessee shall pay Owner a royalty (the "Production Royalty") at a rate
of for any Sand ~ Gravel removed from the
Property. The Production Royalty rate shall be subject to annual adjustments in
the manner described in Paragraph 4.3 below.
4.2. Sand 6 Gravel Excavated on Which No Royalty is Due. Lessee shall not
be required to pay for, nor pay a Production Royalty on, quantities of Sand &
Gravel used by Lessee in constructing, maintaining or repairing roadways on the
Property or used in other areas on the Property, or Sand 6 Gravel used for
reclamation or flood protection on or in connection with the Property. Lessee
shall not be required to pay for, nor pay a Production Royalty on, quantities of
Sand & Gravel taken by the More family~in the normal maintenance and operation
of the More Family Ranch. Lessee shall not be required to pay for, nor pay a
Production Royalty on, Sand ~ Gravel excavated but not suitable for sale. Such
Sand s Gravel shall be used on the Property for reclamation in accordance with
the approved reclamation plan or otherwise disposed of on the Property at the
reasonable direction of Owner, in accordance with sound and economic mining and
reclamation practices, at the expense of Lessee.
4.3. Royalty Rate Adjustment. The Production Royalty rate per ton
beginning on the first Adjustment Date and each subsequent Adjustment Date
thereafter will be increased or decreased based on the adjustment, but never be
less than the initial Production Royalty rate set forth in Paragraph 9.1. The
adjustment shall be calculated by using one of the two following methods which
ever results in the larger adjustment:
A. A commodity increase based upon the average selling price of
unproc sed pit run from the base year period assume year 2001 to be price
of ~ for unprocessed pit run which results in a per ton royalty of
as compared to the average selling price of unprocessed sand and
gravel fox any subsequent year during the lease. The twelve month period
shall be from October to October to match the method in B, below. For
example, if in year 2007 the average selling price of unprocessed pit- run
is $~ then the minimum commodity increase factor for the year 2008
would be arrived at follows:
[~ per ton (last year average selling price) 9~ per ton (base
year average selling price)) x $1.00 per ton (base royalty price) = S 1.37
per ton (the adjusted royalty rate for 2008)
or;
j%~/~ e. The Production Rate of ~ ~ shall be multiplied by a
/r17~ factor determined by subtracting the index published for October 2001.

•~~ Ate(, (hereafter known as the base
the current year and divided year) from the index published for October of
by the base years index.
~~
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