COAL LEASE
Made
and
executed as of July 11, 2007, by and between ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇,
of and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, of ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (“Lessors”), and One
World Energy Corporation, a Nevada corporation, having offices in
Henderson, Nevada (“Lessee”).
WHEREAS,
Lessors are the owners of certain pieces, parcels or tracts of land
(“the premises”), containing approximately 86.64 acres in two contiguous
parcels, located in Conemaugh Township, Indiana County, Pennsylvania, more
fully
described on Exhibit A attached hereto and made part hereof; and
WHEREAS,
Lessors desire to lease and demise the premises to Lessee, and Lessee desires
to
take and hire same from Lessors, for the purpose of mining and removing coal
of
the Pittsburgh and Redstone seams or veins of coal by the strip mining
method.
NOW,
THIS COAL LEASE (“this Lease”), WITNESSETH, that Lessors and Lessee
hereby covenant and agree as follows:
Article
I
Grant
- Term
1.01. Lessors
hereby lease and demise unto Lessee, and Lessee hereby takes and hires from
Lessors, for the sole purpose of mining and removing coal of the Pittsburgh,
and
Redstone seams or veins of coal by the strip mining method, the premises, being
those certain pieces, parcels or tracts of land located in in Conemaugh
Township, Indiana County, , more particularly described on Exhibit A attached
hereto and made part hereof.
1.02. This
Lease shall commence on the date first above written, and, unless sooner
terminated pursuant to any provision hereof, shall remain in force for three
years or until the announced exhaustion of all coal of the Pittsburgh, and
Redstone seams or veins underlying the premises which are commercially mineable
by the strip mining method.
Article
II
Production
Royalties
2.01. As
royalty for the coal mined and produced hereunder, Lessee shall pay unto Lessors
the sum equal to the greater of (i) ten percent (10%) of the selling price
of
the coal, fob pit, received by Lessee in an arms’ length sale of the coal, or
(ii) two dollars ($2.00) per net ton of coal mined and
produced. Provided, however, that if Lessee disposes of the coal
other than in an arms’ length sale, i.e., by selling it to a related
person or entity, the royalty shall be the sum equal to the greater of (i)
ten
percent (10%) of the market value of the coal, fob pit (i.e., the
price, fob pit, for which the coal would be sold between unrelated parties
in
the location of the premises, or (ii) two dollars and ten cents ($2.10) per
net
ton of coal mined and produced.
2.02. Lessee
shall pay all production royalties on or before the 25th day of
the
calendar month following the month in which the coal for which payment is made
is produced. Payment shall be made by check directed to Lessors at
the address set forth in Paragraph 8.03.
2.03. In
order that Lessors may determine that they have been paid all production
royalties to which they are entitled under the terms hereof, Lessee agrees
to
keep full and accurate records, including books of account, weigh bills and
invoices to purchasers of coal mined and produced hereunder, which fully
disclose the tonnage of coal mined and produced, and the purchase price received
by Lessee therefor. Such records shall be available for inspection by
Lessors or Lessors’ duly authorized agent during regular business hours upon 5
days’ notice from Lessors that they desire to make such an
inspection.
Article
III
Advance
and Minimum Royalties
3.01. Upon
the signing of this Lessee shall pay unto Lessors an advance royalty in the
amount of three thousand dollars, which Lessee shall pay unto Lessors within
sixty days from the signing of this contract, and 2500 restricted shares of
Inform Worldwide Holdings.
3.02. Beginning
on July 11, 2008, and thereafter on the first day of each and every calendar
month thereafter so long as this Lease remains in effect, Lessee shall pay
unto
Lessors a monthly minimum royalty in the amount of twenty five dollars
($25.00).
3.03. Lessee
shall be entitled to a credit against the production royalties due Lessors
pursuant to Paragraph 2.01 for the advance royalty paid pursuant to Paragraph
3.01 and all minimum royalties previously paid pursuant to Paragraph
3.02. When Lessee establishes production, and a production royalty is
due Lessors pursuant to Paragraph 2.01, Lessee shall be entitled to take as
a
credit against payment of the production royalty all sums previously paid and
accumulated as set forth in the preceding sentence. In the event the
amount of the production royalty does not fully absorb all sums previously
paid
and accumulated, Lessee may carry forward any unused credit for advance and
minimum royalties to be applied on the next date at which a production royalty
is due. Provided, however, that Lessee shall nevertheless be required
to make the monthly minimum royalty payment provided in Paragraph 3.02 on the
first day of each and every subsequent calendar month regardless of whether
Lessee has to its credit sums previously paid and accumulated; it being the
intent of this sentence that, beginning with July 11, 2008, Lessors shall
receive a minimum payment of twenty five dollars ($25.00) per month so long
as
this Lease remains in effect.
Article
IV
Permitting
Requirements - Compliance with Law
4.01. Lessee
shall be responsible, at its sole cost and expense, to apply for and procure
all
licenses and permits required by the United States of America, the Commonwealth
of Pennsylvania, and any local governmental unit, in connection with the mining
and stripping operations which the parties intend for Lessee to conduct upon
the
premises. Lessee shall be further responsible to acquire all
necessary bonds required by the United States of America, the Commonwealth
of
Pennsylvania, and any local governmental unit, in connection with Lessee’s use
of any public road, highway or infrastructure. Lessors agree to
execute any consents which Lessee may require in connection with any license
or
permit application, including but not limited to the Supplemental C normally
required by the Commonwealth of Pennsylvania, Department of Environmental
Protection.
4.02. Lessee
agrees to conduct its operations upon the premises in compliance with all
applicable laws, ordinances, rules and regulations of the United States of
America, the Commonwealth of Pennsylvania and any local government unit having
jurisdiction over the premises. Lessee further agrees to indemnify
Lessors, and to hold Lessors and their heirs, executors, administrators and
assigns fully harmless of and from any liability for such violation and of
and
from any fine, penalty or cost associated therewith. Nothing herein
contained shall preclude Lessee from challenging the validity or applicability
of any such law, ordinance, rule or regulation before any court or tribunal
having jurisdiction of such contest, provided that Lessee (i) pays all cost,
expenses, filing fees and attorney and expert witness fees associated with
such
contest, (ii) abides by the final judgment of such court or tribunal unless
Lessee takes a timely appeal therefrom, and (iii) continues to indemnify Lessors
and hold Lessors harmless hereunder.
4.03. Following
the completion of Lessee’s stripping operations under this Lease, Lessee agrees
to backfill, restore and replant the premises in accordance with all laws,
ordinances, rules and regulations of the United States of America, the
Commonwealth of Pennsylvania and any local government unit having jurisdiction
over the premises. In order to enable Lessee to fulfill this
obligation, Lessors agree to grant unto Lessee such rights of ingress, egress
and regress in, across and from the premises as Lessee may require. Lessor
owns
and operate a tree farm. Any haul road that crosses through the tree farm must
be kept in good operational condition while used by Lessee, at the cost of
Lessee.
Article
V
Insurance
- Indemnification
5.01. Lessee
shall, at its sole cost and expense, maintain public liability and property
damage insurance, which shall include motor vehicle liability, which shall
insure against any liability to any person, partnership, firm, corporation
or
entity, public or private, arising from any activity conducted or condition
or
use maintained by Lessee under this Lease. Such insurance shall have
minimum limits in the amount of one million dollars ($1,000,000.00), and shall
name Lessors as additional insureds as their interest may
appear. Prior to entering upon the premises pursuant to this Lease,
Lessee shall provide Lessors with a certificate from the insurer that the
insurance required by this Paragraph is in effect, which certificate shall
require not less than thirty (30) days’ notice to Lessors in the event of change
or cancellation of the coverage.
5.02. Lessee
shall, at its sole cost and expense, maintain appropriate workers’ compensation,
unemployment compensation, Black Lung and other occupational disease insurance
covering all employees engaged in any activities connected with this
Lease. Prior to entering upon the premises pursuant to this Lease,
Lessee shall provide Lessors with a certificate from the insurer that the
insurance required by this Paragraph is in effect, which certificate shall
require not less than thirty (30) days’ notice to Lessors in the event of change
or cancellation of the coverage.
5.03. Lessee
agrees to indemnify Lessors, and to hold Lessors and their heirs, executors,
administrators and assigns fully harmless of and from any liability to any
person, partnership, firm, corporation or entity, public or private, arising
from any activity conducted or condition or use maintained by Lessee upon the
premises or under this Lease, regardless of whether Lessee is negligent or
otherwise at fault in causing such injury or damage.
Article
VI
Default
- Lessors’ Remedies
6.01. The
following shall be acts of default by Lessee hereunder:
(a)
Failure to pay when due any advance, minimum or production royalty due pursuant
to Articles II and III,
(b)
Failure to maintain insurance as required by Paragraphs 5.01 and
5.02,
(c)
Violation by Lessee, in connection with its activities upon the premises, of
any
applicable federal, state or local law, ordinance, rule or
regulation.
6.02. In
the event Lessee commits an act of default as defined in Paragraph 6.01, Lessors
may give Lessee notice, directed to the Lessee’s address set forth in Paragraph
8.03, specifying the particulars of the default. Lessee shall fully
correct and remedy the default within thirty (30) days of receipt of the
notice.
6.03. If,
following receipt of notice of a default, Lessee fails to fully correct and
remedy the default within the time provided in Paragraph 6.02, Lessors may
avail
themselves of the following remedies:
(a)
Bring
an action in any court of competent jurisdiction to recover a money judgment
for
any monies owed Lessors by Lessee hereunder, and
(b)
Declare this Lease to be terminated and, upon an additional thirty (30) days’
notice to Lessee, bring an action in ejectment in the Court of Common Pleas
of
Indiana County, Pennsylvania, to obtain judgment in ejectment and to recover
possession of the premises.
The
use
of either of the remedies set forth in subparagraphs (a) and (b) shall not
be
deemed an election of remedies, and shall not preclude Lessors from also using
the other remedy.
Article
VII
Assignment
- Subletting
7.01. Lessee
shall not assign this Lease, nor sublet the premises or any part thereof,
without first having received the written consent of Lessors, which consent
Lessors shall not unreasonably withhold.
Article
VIII
Miscellaneous
8.01. This
Lease shall be governed and construed in accordance with the law of the
Commonwealth of Pennsylvania.
8.02. This
Lease may be executed in multiple copies, each of which shall have the effect
of
an original and all of which together shall be considered the same
instrument.
8.03. Notices
required to be given by one party to the other shall be given by first class
mail, postage prepaid, addressed as f ollows:
To
Lessors at:
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To
Lessee
at:
One
World
Energy Corporation
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8.04. This
Lease shall not be recorded in the Office of the Recorder of Deeds of Indiana
County, Pennsylvania, nor in any other office of public record. The
parties shall execute, and Lessee may record, a memorandum containing only
the
information specified at 21 P.S. Section 405.
8.05. Each
party has had independent legal representation in the negotiation, drafting
and
execution of this Lease. No inference or presumption shall exist in
favor of or against either party as a result of that party’s attorney’s role in
the drafting of this Lease.
8.06. This
Lease shall be binding upon, and its benefits shall inure to, the heirs,
executors, administrators, successors and assigns of Lessors and Lessee;
provided, however, that this provision shall not be deemed to permit Lessee
to
assign this Lease nor sublet the premises in contravention of Paragraph
7.01.
8.07 Any
marketable timber or firewood encountered by leasee while in the process of
strip mining (as approved by Lessor) will be paid for as follows; with 50/50
division on net proceeds from the sales price of timber at the mining site,
firewood would have 75% of proceeds from final sale at mine to One World Energy
Corporation, with the remainder to the Lessors.
INTENDING
TO BE LEGALLY BOUND, Lessors and Lessee have signed this Lease this day
and year first above written.
___/s/
▇▇▇▇▇▇ A Mancabelli___
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▇ ▇▇▇▇▇▇▇▇▇▇
___/s/
▇▇▇▇▇▇▇ ▇. Mancabelli__
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▇ ▇▇▇▇▇▇▇▇▇▇
One
World Energy Corporation
By___/s/
Ash Mascarenhas________
Ash
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