NPI Royalty definition
Examples of NPI Royalty in a sentence
Schedule I: Intentionally deleted Schedule J: Form of Acquisition Warrant Certificate Schedule K: Form of NPI Royalty Schedule L: Registration Rights Agreement Schedule M: PR Pre-Closing Reorganization Schedule N: Key Regulatory Approvals Schedule O: Title Curative Actions Any information or disclosures set forth on a Schedule to this Agreement shall reference with particularity the section or subsection number of the Agreement to which such information or disclosure is set forth on the Schedule.
If in any year after the beginning of Mining of the Property, an operating loss relative thereto is incurred, the amount thereof shall be considered as and be included with outstanding costs and expenses and carried forward in determining the NPI Royalty for subsequent periods.
Finally, it is further agreed that this NPI Royalty Agreement shall be construed in accordance with the laws of the State of Nevada.
Unlike the NSR Royalty, the holder of the NPI Royalty will not accrue payments on the Royalty upon commencement of commercial production, since the operator will be entitled to deduct all exploration and capital costs (which may be large) prior to earning a “profit.” NPI Royalties are typically difficult to calculate and therefore can be subject to disputes 6 ROCKY MOUNTAIN MINERAL LAW FOUNDATION JOURNAL [Vol.51 No.1 between the operator and the Royalty Holder.
This is particularly true in the case of NPI Royalties, where the calculation of the NPI Royalty is complex and may be subject to varying interpretations.
If payment is not made within 30 days of demand, the other party may elect to advance the amount of the defaulted payment and the defaulting party shall be deemed to have assigned and conveyed its interest to the other party, or parties as the case may be, and in consideration therefor the defaulting party will be entitled to receive a NPI Royalty capped at such party’s actual contributions to Expenditures and Costs hereunder.
It is intended that the remaining Participant shall recoup from Gross Revenue all of its on-going contributions for Exploration, Development, Mining, Expansion and Modification and marketing Products before any payments are distributed to any Person holding an NPI Royalty.
Should such reimbursement not be made by such date the defaulting party shall be deemed to have assigned and conveyed its interest to the other party, or parties as the case may be, and in consideration therefore the defaulting party will be entitled to receive a NPI Royalty capped at such party’s actual contributions to Expenditures and Costs hereunder.
It is further agreed that the NPI Royalty Holder is not responsible for providing either capital or covering operating losses and/or environmental liabilities, if any should occur.
From the operator’s perspective, NPI Royalties may be preferable to NSR Royalties because payments need not be made until a “profit” is obtained, which means that, unlike the NSR Royalty, the NPI Royalty does not act as a cost of the project which must be considered in determining whether the property can be mined economically.