Exhibit 10.1
MINERAL AND MINING LEASE
THIS LEASE is made and effective the 1st day of February, 2010, between; Xxxxxx
and Associates, LLC, whose address is 000 Xxxxx Xxxx, Xxxxxxxx, XX 00000 (called
"Lessor), and ESL Teachers Inc., whose address is 8th floor - 000 Xxxxx Xxxxxxxx
Xxxxxx, Xxxx, Xxxxxx, 00000 (called "Lessee").
WITNESSETH:
1. INTERESTS LEASED. For and in consideration of Ten Dollars paid to Lessor by
Lessee, the receipt and sufficiency of which are hereby acknowledged by the
Lessor, and the mutual covenants set forth herein, Lessor hereby grants and
leases exclusively unto Lessee all coal in, under and appurtenant to the lands
described as the Premises below (all of which materials, minerals and deposits
are called the "Subject Minerals"). The Subject Minerals are leased, as above,
together with all interests hereafter acquired by or for Lessor in the Premises,
and together with whatever rights are controlled by the State of Wyoming Coal
Lease 0-41076 section 36, T45N, R75W.
The Premises consists of the following described land and property, in the
County of XXXXXXXX and State of WYOMING: Lease 0-41076 section 36, T45 N, R75W,
owned by Xxxxxx & Associates, LLC containing approximately, 640 acres.
2. TERMS OF LEASE. This lease is granted for an initial term of five (5) years
from and after the date hereof, and for a continuing term as long after the
initial term as any mining, development, processing, or reclamation is being
conducted hereunder on a continuous basis. Such operations shall be deemed
conducted on a continuous basis unless and until, after the end of the initial
term, a period on one hundred eighty (180) consecutive days elapses in which no
mining or developing or processing or testing is conducted, excluding, however,
periods of force majeure as provided herein.
Unless otherwise specified, all reference to the "term" of the lease shall mean
and include both the initial term and the continuing term.
Lessee is also subject to and obligated to meet all the terms of the lease with
the State of Wyoming.
3. PAYMENTS. The initial payment will be 100,000 post split restricted shares of
common stock of the Lessee (the "Consideration Shares") for execution of this
lease, issuable upon the Lessee completing a pending 30 for one forward split of
its shares of common stock. An annual payment of $20,000 (adjusted annually by
the CPI (consumer price index as published by the US Government) according to
this formula each year previous payment times 1+ fractional CPI index. For
example if CPI is 3% the following payment will be 20,000 x 1.03 or $20,600, if
next years CPI is 2 % then the calculation would be 20,600 x 1.02 or $21,012.
which will keep the lease valid for one additional year. Payments will be made
to an address and account of the Lessor's choosing.
All payments will be creditable as advanced royalties and will accrue against
the royalties to be paid if mining occurs.
In regards to the Consideration Shares:
(a) They will upon issuance be issued as fully paid and non-assessable.
(b) The Lessor agrees not to undertake any sales, transfers or assignment
of the Consideration Shares for a period of two years from the date
hereof, without the prior written consent of the Lessee.
(c) The Lessor is an "accredited investor" as the term is defined in
section 501(a) of Regulation D under the 1933 Act, by virtue of its
equity owners each being accredited investors.
(d) The Consideration Shares have not been registered under the United
States Securities Act of 1933, as amended (the "1933 Act"), or under
any state securities or "blue sky" laws of any state of the United
States, and are being offered only in a transaction not involving any
public offering within the meaning of the 1933 Act, and, unless so
registered, may not be offered or sold in the United States or to U.S.
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Persons (as defined in Regulation S promulgated under the 1933 Act),
except pursuant to an effective registration statement under the 1933
Act, or pursuant to an exemption from, or in a transaction not subject
to, the registration requirements of the 1933 Act, and in each case
only in accordance with applicable state securities laws.
(e) The Lessor is receiving the Consideration Shares for its own account
for investment purposes only and not for the account of any other
person and not for distribution, assignment or resale to others, and
no other person has a direct or indirect beneficial interest in such
Consideration Shares, and the Lessor has not subdivided its interest
in the Consideration Shares with any other person.
(f) The Lessor is not an underwriter of, or dealer in, the common shares
of the Lessee, nor is the Lessor participating, pursuant to a
contractual agreement or otherwise, in the distribution of the
Consideration Shares.
(g) The Lessor is not aware of any advertisement of any of the
Consideration Shares and is not acquiring the Consideration Shares as
a result of any form of general solicitation or general advertising
including advertisements, articles, notices or other communications
published in any newspaper, magazine or similar media or broadcast
over radio or television, or any seminar or meeting whose attendees
have been invited by general solicitation or general advertising.
4. ROYALTIES. Lessee shall pay Lessor, on or before the 25th day of each
calendar month, for the right to mine all coal on the Premises as leased
hereunder a production royalty of 4% of the Gross Sales Price of all coal mined
and sold from the Premises the previous month at the Loading Point. The Gross
Sales Price shall be the weighted average per ton selling price of all coal
mined from the premises and sold by the lessee in the previous month. The
Loading Point shall be the point at which coal mined from the Premises by the
Lessee leaves possession and control of the Lessee to be shipped to market or
the final consumer of the coal and whether from the mine or preparation plant of
the Lessee as the case may be. This royalty is to the Lessor and is in addition
to any other government royalities or fees that may be payable on coal mined
from the Premises.
Each such payment shall be accompanied by a statement showing weights, analyses
and values of all coal, produced from the Premises during the period for which
payment is made and the amount of the charges or costs deductible there from.
All statements rendered to Lessor by Lessee shall be conclusively resumed to be
true and correct after sixty (60) days from the end of the period to which such
statement applies unless within said sixty-day period Lessor takes exception
thereto and makes written claim on Lessee for adjustment. Failure on the part of
Lessor to make claim on Lessee for adjustment in such period shall establish the
correctness and preclude the filing of exceptions thereto or making of claims
for adjustment thereon. No adjustments favorable to Lessee shall be made unless
within the prescribed period or unless in connection with a claim of Lessor.
6. ROYALTY PURCHASE OPTION
For the period beginning as of the date of this lease and continuing to the
third anniversary date. The Lessor hereby grants the Lessee an option to buy out
3% of the 4% production royalty in increments of 1% at a purchase price of
$600,000 per increment.
7. OPERATIONS
A. EXPLORATION, MINING AND OTHER OPERATIONS. The Lessee may use and employ
methods of exploration, development, mining and processing 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 hereunder to pay annual payments and royalty due, if any,
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 by the Lessee at the time encountered. Lessee shall
have the right and privilege at any time, during the term of this lease and as
long thereafter as it may hold an interest in minerals in, on or under adjacent
or neighboring lands, to use any and all roads or workings located at anytime on
or under the premises to facilitate mining ores or materials on adjacent or
neighboring properties, whether or not contiguous and whether or not owned by
Lessor. Lessee shall have the further right of mixing, either underground or at
the surface or processing plants, any ores, solutions or other products from any
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other lands, provided that the mixing is accomplished only after the same 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, and of the analysis, of ore, concentrate or other products from each
property going into such mixture shall be kept and made available to Lessor at
all reasonable times, and shall be used as basis of the allocation between the
properties, of production royalties to be paid therefore.
B. MAINTENANCE. Lessee agrees to make all annual State of Wyoming payments due
to maintain lease. Such payments will be made more than 90 days in advance of
State of Wyoming lease due date. If payment has not been made in the final 30
days then Lessor can make payment to keep the lease active. Lessee must
reimburse Lessor double the amount paid within 90 days of payment. If not
reimbursed this lease agreement is null and void and the lease reverts back to
Lessor.
C. Lessee agrees to maintain all roads, camps, drillsites, and mines in a good
and workmanlike manner.
D. PAYMENT FOR DAMAGES. The Lessee shall pay an equitable compensation to the
injured party or parties for actual damages caused by its operations upon the
Premises, including, damage to crops, grazing values, fences, gates, reservoirs,
roads, and structures, and damage sustained by reason of injury or loss of
livestock.
8. 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 Lessee's operations, to go upon the 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 Premises, unless such death or injury arises as a result of
negligence of the Lessee.
9. TAXES. Lessor agrees to pay all general (surface use) ad valorem taxes and
assessment assessed against the Premises and all taxes resulting from the
Lessor's use thereof, if any. Lessee shall pay for that portion of such taxes
which is attributable to any producing mine opened and operated on the 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 Premises
and attributable to Lessee's operations, or upon any area and other product's
thereof, or upon any property or improvements placed by lessee on the Premises.
If any tax is now or hereafter levied on or measured 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 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.
10. WARRANTY. Lessor hereby warrants to the Lessee that the Lessor owns a 100%
working interest in the Subject State of Wyoming Coal Lease, free and clear of
any tax, mortgage, or other existing leans and the Lessor covenants that while
this lease remains outstanding Lessor will not mortgage, pledge or otherwise
encumber the Mineral Interest. The lease is only subject to the terms of the
lease from the State of Wyoming.
11. ASSIGNMENT. The estate of either party may be assigned in whole or in part.
No change in the ownership of the Premises or assignment or royalties' payable
hereunder shall be binding upon Lessee until Lessee has been furnished with a
written transfer or assignment or a certified copy thereof. If this lease is
assigned as to a part or parts of the Premises and the Lessee, or assignee or
assignees of any part or parts, fails or defaults 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 of parts of the Premises. An
assignment of this lease shall, to the extent of the assignment, relieve and
discharge the Lessee of all obligations hereunder which have not theretofore
become due.
12. MULTIPLE LESSORS. Whenever four or more parties are entitled to receive
annual payments or royalties hereunder, Lessee may withhold payment thereof
unless and until all such parties designate in a recordable instrument as agent
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empowered to receive all royalty or annual payments due hereunder and to execute
division and transfer orders on behalf of said parties and their respective
successors in title.
13. DEFAULT; FORCE MAJEURE; TERMINATION. If at any time Lessee is in default in
the performance of the terms and conditions of this lease to be performed by it,
and if, within ninety (90) days after written notice of default is 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 written
notice to Lessee, provided that, if the default is a failure to pay, when due, a
sum of money expressly required to be paid hereunder, Lessor may terminate this
lease by written notice to Lessee if such default is not cured within thirty
(30) days after the written notice of the default is given to Lessee. Lessor
shall have no right to terminate this lease except as expressly provided in the
foregoing provisions of this paragraph.
Lessee shall not be deemed in default, or to have ceased performance or
operations hereunder, during any period in which performance or operations are
prevented by any cause reasonably beyond Lessee's control, each of which causes
is called "force majeure". Force majeure shall include, without limitation,
fire, floods, windstorms, and other damage from the elements, legislation,
public regulations or other action of government authority, litigation, acts of
God and acts of the public enemy. The duration of this lease shall be extended
for a period equal to the period of force majeure. All periods of force majeure
shall be deemed to begin at the time Lessee stops performance or operations
hereunder by reason of force majeure and Lessee shall notify Lessor of the
beginning and ending date of each such period. Nothing herein shall limit
Lessee's obligation to pay annual payments, or royalty for ore mined and sold,
as provided in this lease.
Lessee shall have the right to terminate this lease at any time or times during
the term hereof, as to the Subject Minerals underlying all or any one or more
parts of the Premises, by delivering or mailing to Lessor written notice stating
such intention to terminate and describing the parts of the Premises, if less
than all, so to which the termination applies. The termination shall take effect
upon the date specified in the notice, or, if no date is specified, upon the
date on which the notice is given. Upon such termination, all right, title,
interest and obligations of Lessee hereunder in and to the Premises specified in
the notice shall terminate, except obligations which then have accrued under the
express provisions of this lease and which then have not been paid or performed.
If the notice specifies that this lease is thereby being terminated, as to the
Subject Minerals underlying a part, and less than all, of the Premises, this
lease shall continue in effect as to the Subject Minerals underlying a part, and
less than all, of the Premises, this lease shall continue in effect as to the
Subject Minerals underlying all parts of the Premises except the part or parts
so specified. Forthwith after delivery of the notice of termination, Lessee
shall execute and record, or deliver to Lessor for recording, a formal release
of this lease as to the parts of the Premises described in the notice.
Lessee shall have the right to remove from the Premises any machinery, fixtures,
buildings, stockpiles of ore or minerals, and other property placed on the
Premises by Lessee. This right may be exercised at any times during the term
hereof, or within one year after expiration or termination of this lease as to
the parts of the Premises on which such property is located.
14. FURTHER DOCUMENTS. 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 Subject Minerals, the Premises or
Lessee's operations hereunder, and shall execute and deliver to Lessee any
instructions, agreements, documents, or other papers reasonably required by
lessee to effect the purpose of this lease. Lessor at all time times shall
cooperate with Lessee in any reasonable way to assist Lessee in effecting the
purposes of this lease.
15. NOTICES. All notices required or permitted to be given hereunder shall be
deemed properly given upon delivering the same to the party to be notified, or
upon the seventh day after mailing the notice, by registered or certified mail,
return receipt requested, to the party to be notified at its address set forth
above, or such other address as the party to be notified may have designated
prior thereto by written notice to the other. All routine reports hereunder
maybe delivered by ordinary United States mail, addressed to the recipient at
its above address.
16. ADVERSE CLAIM. In case of suit, adverse claim, dispute or question, as to
the ownership of the Premises or of the annual payments or royalties (or any
interest therein) payable under this lease, Lessee shall not be in default in
payment of annual payments or royalties until the suit, claim, dispute or
question has been finally disposed of. Any payments so withheld shall be paid
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within thirty (30) days after Lessee has been furnished with the original
instruments disposing of the suit, claim or dispute (or certified copies
thereof), or after lease has been furnished with proof sufficient, in Lessee's
opinion, to settle the question. If the rights or interest granted Lessee
hereunder are disputed, it shall not be counted against Lessee either as
affecting the term of the lease (which shall be extended by the period of the
dispute) or for any other purpose, and Lessee may withhold all payments due
Lessor hereunder without interest until there is a final adjudication or other
determination of the dispute.
17. HOMESTEAD. Lessor hereby release and relinquishes any right of homestead
exemption which Lessor may have in the Premised or in the Subject Minerals.
18. BINDING EFFECT. This lease shall be binding on the parties hereto, and upon
their heirs, successors and assigns. This Lease shall be binding upon all who
execute it, whether or not named in the body hereof as Lessor and without regard
to whether this instrument or any copy thereof shall be executed by any other
Lessor named above. All who execute this lease shall be Lessors the same as if
named in the body hereof.
IN WITNESS WHEREOF, this lease has been executed as of the day and year first
above written.
LESSEE: LESSOR:
/s/ Xxxxxxxx Xxxxxxx /s/ Xxxxx Xxxxxx
------------------------------------- ----------------------------------
Authorized Signatory Mr. Xxxxx Xxxxxx
ESL Teachers Inc. Xxxxxx & Associates, LLC and/or
8th floor - 000 Xxxxx Xxxxxxxx Xxxxxx Xxxxx Xxxxxx
Xxxx, Xxxxxx, 00000 000 Xxxxx Xxxx
Xxxxxxxx, XX 00000
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LIMITED LIABILITY COMPANY ACKNOWLEDGMENT
STATE OF WYOMING
COUNTY OF FREMONT
Before me, the undersigned, a Notary Public in and for said County and State, on
this ______ day of ________________ 2008, personally appeared Xxxxx Xxxxxx to me
known to be the identical persons who subscribed the names of the persons
thereof to the foregoing as Members of Xxxxxx & Associates, LLC, and
acknowledged to me that they executed the same as their free and voluntary act
and deed, and as the free and voluntary act and deed of such corporation, for
the uses and purposes therein set forth.
Given under my hand and official seal, the day and year last written above.
(AFFIX SEAL)
--------------------------------
NOTARY PUBLIC - Print Name
My Commission Expires: _________ in for the County of __________ State of ___
CORPORATE ACKNOWLEDGMENT
PROVINCE OF: BRITISH COLUMBIA
CITY OF: VANCOUVER
Before me, the undersigned, a Notary Public by Royal Authority in and for the
City of Vancouver, in the Province of British Columbia, on this ______ day of
________________ 2010, personally appeared __________, to me known to be the
identical person who subscribed the name of the person thereof to the foregoing
as PRESIDENT of ESL Teachers Inc., A NEVADA CORPORATION, and acknowledged to me
that he executed the same as his free and voluntary act and deed, and as the
free and voluntary act and deed of such corporation, for the uses and purposes
therein set forth.
Given under my hand and official seal, this __________________ day of
______________________________2010.
(AFFIX SEAL)
--------------------------------
NOTARY PUBLIC - Print Name
My Commission Expires: ________ in for the City of Vancouver in the Province of
British Columbia
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EXHIBIT A
TERMS OF LEASE
1. INITIAL PAYMENT: 1,000,000 CONSIDERATION SHARES (AS DEFINED IN THE LEASE),
DUE UPON EXECUTION OF LEASE.
2. ANNUAL PAYMENT: $20,000.00 (US), DUE ANNUALLY ON THE ANNIVERSARY DATE OF
THE AGREEMENT. (adjusted annually by the CPI (consumer price index as
published by the US Government), according to the following formula; each
year previous payment times 1+ fractional CPI index. For example if CPI is
3% the following payment will be 20,000 x 1.03 or $20,600, if following
year CPI is 2 % then the calculation would be 20,600 x 1.02 or $21,012.
which will keep the lease valid for one additional year. First anniversary
payment will be 20,000 + cpi adjustment for the first year.
3. ROYALTY: 4% of gross value of ore sold from stockpile at the mine.
