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IN-SITU URANIUM MINING LEASE

STATE OF TEXAS § COUNTY OF DUVAL §

                   THIS LEASE AND AGREEMENT, dated as of the “Effective Date” as
defined below, is made by and between LA PALANGANA RANCH MANAGEMENT, L.L.C., a
Texas limited liability company acting by and through its duly appointed
Co-Manager designated below (hereinafter referred to as “Lessor”) and EVEREST
RESOURCE COMPANY, a
_____Texas___ corporation, and KDH OPERATIONS LTD. a ____Texas___limited
partnership (hereinafter referred to collectively as “Lessee”).

WITNESSETH

                   DEFINITIONS: The parties hereto agree that for purposes of
this Lease the following definitions shall apply:

                   a.    Production in “paying” or “commercial” quantities shall
have the same meaning for purposes of this Lease, namely production in
quantities sufficient to yield a return to the owners of the leasehold estate
excluding applicable production taxes, in excess of operating expenses and costs
(including all costs recognized by court precedent in Texas which are included
in determining whether minerals are being produced in paying quantities) when
measured over a reasonable period of time.

                   b.    “Operations for drilling”, “operations for solution
mining”, “drilling operations”, “mining operations”, “commencement of drilling
operations”, “commencement of mining operations”, “actual drilling operations”
and “actual mining operations” and all logical derivations thereof shall have
the same meaning, being: (i) the actual entry of the drill bit of a drilling
rig, capable of achieving the total depth permitted and approved by applicable
government authority into the soil of the Leased Land and the timely prosecution
of such actual operations with reasonable diligence to the completion of same as
a dry hole or commercial well.

                   GRANTING CLAUSE: That in consideration of Ten Dollars
($10.00) and other good and valuable consideration paid by Lessee, the receipt
and sufficiency of which is hereby acknowledged by Lessor, and in future
consideration of the Royalties herein provided and the agreements of the Lessee
herein contained, Lessor hereby grants, leases and lets unto Lessee, to the
extent Lessor has said rights now or in the future, the land covered hereby
(hereinafter referred to as “Leased Land”) with the right of ingress and egress
for the purposes hereinafter specified, the following described land in Duval
County, Texas, containing 3,100.64 acres, more or less, TO-WIT:

                   3100.64 acres, more or less, LIMITED TO THOSE DEPTHS LYING
FROM THE SURFACE OF THE EARTH DOWN TO AND INCLUDING 1,500’ SUBSURFACE, situated
in Duval County, Texas, being out of the following surveys, to wit:

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Sur. Cert. Original Patentee Pat. No. Vol. Abstract     Grantee       No. 255
1/42 S.M. &S. J. J. Dix 454 22 590 247 342 S.K. & K. J. J. Dix 430 22 548 245
341 S.K. & K. J. J. Dix 429 33 549 81 31/184 H. & H.R.R. J. J. Dix 64 25 249 239
1/309 J. Poitevent J. J. Dix 296 22 399 3 3 J. Pettigrew Mrs. J. Pettigrew 589
37 374 241 339 S.K. & K. J. J. Dix 428 33 551 1 5/202 H.T. & B.R.R. John A. Dix
119 19 328

Said 3100.64 acres is Share No. 3, Parcel F-2, allotted to Robert Schallert in
the decree of partition rendered by the District Court of Nueces County, Texas,
on August 8, 1908, in Cause No. 4271, styled Robert Schallert, et al. vs. Chas.
Hoffman, et al., which Decree is incorporated herein by reference and made a
part hereof for an accurate metes and bounds description of said Share and
Parcel and for all other pertinent purposes.

                   1. Uses, Exceptions and Reservations.

                     A. The Leased Land shall be used by Lessee for the
exclusive purposes of investigating, exploring, prospecting, drilling, solution
mining, producing, extracting, milling, treating, processing, upgrading,
removing, transporting, stockpiling and storing uranium, thorium and other
fissionable or spatially associated substances similar to and produced in
conjunction with those mentioned above (hereinafter referred to individually or
collectively as “Leased Substances”) by commercially acceptable methods which
are permitted to be used under applicable law.

                     B. There is EXCEPTED from this Lease and Lessor RESERVES
unto itself, its successors and assigns the following estates, properties and
substances within the Leased Land: all oil, gas and all other liquid, solid and
gaseous hydrocarbons and sulphur that is necessarily produced with such oil or
gas, caliche, sand, gravel, water (except for the use of water which is
expressly authorized herein) and all minerals located in, on or under the Leased
Land except for the Leased Substances.

                     C. Lessor further EXCEPTS from this Lease and Lessor
RESERVES unto itself, its successors and assigns equal and concurrent rights of
occupancy, use and possession of the surface estate of the Leased Land by Lessor
or Lessor’s other mineral, commercial, surface, grazing and recreational lessees
or assignees, together with the equal and concurrent right of ingress to and
egress from and over the Leased Land for, unless otherwise prohibited herein,
the purpose of exploring, developing and operating the Leased Land for oil, gas
and other minerals of whatever nature which are excluded from this Lease or
which may hereafter be released from this Lease, and equal and concurrent rights
to complete water source wells and water injection wells on the Leased Land, in
any reservoir for the purpose of obtaining water for the exploration,
development and operation of Lessor’s reserved rights and for the purpose of
disposing of salt water from the Leased Land only; provided, however, Lessor
agrees not to use the surface of the Leased Land in any manner that will
interfere unduly with any of Lessee’s rights in exploring, developing,
producing, treating, processing, transporting, marketing and caring for Leased
Substances produced from the Leased Land. Further, Lessor reserves surface use
for grazing, hunting, farming and recreational lessees which surface use rights
shall be concurrent with the surface rights herein granted to Lessee. This Lease
is made subject to all matters which appear of record in Duval County, Texas
which concern the Leased Land.

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                     D. Lessor further grants, leases and lets unto Lessee the
Leased Land for the purposes of injecting gas, water or other fluids commonly
associated with solution mining practices, air and any other substance into the
subsurface strata, conducting all types of solution mining recovery operations
for the Leased Substances for the purpose of establishing and/or maintaining
production of Leased Substances.

                     E. Except as may be expressly authorized herein, Lessee
shall NOT be permitted to establish or use the Leased Land for the purposes of
disposing of solution, tailings and other waste materials produced in the
extraction of the Leased Substances, laying pipeline, building roads, bridges,
tanks, power and telephone lines, electric and distribution lines and other
utilities, mills or processing structures or facilities without the prior
express written consent of Lessor.

                     F. Except as may be expressly authorized herein, Lessee
shall NOT be permitted to use the Leased Land or any improvements thereon for
processing, storage, transportation, treatment, stockpiling or any other use of
any substances which are not produced from the Leased Land without the prior
express written consent of Lessor.

                   2. Lease Term. Subject to the provisions herein contained,
this Lease shall remain in force for a term of five (5) years from the
“Effective Date” as defined on the signature pages hereof (hereinafter referred
to as the “Primary Term”) and so long thereafter as uranium or any of the other
Leased Substances are produced in commercial or paying quantities from the
Leased Land, and/or as long thereafter as this Lease may be maintained in force
and effect under any of the other provisions herein contained.

                   3. Royalties: Lessee agrees to pay Lessor royalty on Leased
Substances produced from the Leased Land as follows:

  a.

If Leased Substances mined and produced from the Leased Land by Lessee are sold
by Lessee on the basis of a price per pound, Lessee shall pay to Lessor a
production royalty on such Leased Substances equal to the percentage determined
in the manner set forth below of the amount paid to and received by Lessee upon
the sale of such Leased Substances through an arms-length transaction. An
“arms-length transaction” as used in this Paragraph 3, shall be deemed to be a
bona fide transaction with a third party purchaser not an affiliate, subsidiary
or parent of Lessee, or other entity in which Lessee has a financial interest by
stock ownership or otherwise. If such Leased Substances are used by Lessee off
the Leased Land, or sold other than through an arms-length transaction, then the
appropriate royalty percentage shall be applied to the fair market value of such
Leased Substances after the same has been processed and assayed. The royalty
percentages to be paid to Lessor on production of Leased Substances shall be
determined as follows:

    Royalty   Price per Pound for which Percentage Rate   Leased Substances are
Sold           $25.00 or less 7%   $25.01 or more but less than $30.01 8%  
$30.01 or more but less than $40.01 9%   $40.01 or more 10%

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  b.

All royalties which are due and payable under the terms of this Lease shall be
paid within sixty (60) days after the end of the calendar month within which
Lessee receives the proceeds from the sale of the Leased Substances, which
payment shall be subject to adjustment, by addition to or deduction from royalty
due, as a result of actual sale assay. Lessee’s failure to pay or tender or
timely pay or tender any sum as royalty shall render Lessee liable for the
amount due plus simple interest of Twelve Percent (12%), but shall not operate
as a forfeiture or to terminate this Lease.

        c.

Lessor shall have the right, upon 90 days notice to Lessee, to receive Lessor’s
royalty in kind, provided that any such election by Lessee must be for a minimum
term of at least one (1) year, and in such instance Lessee shall make available
at no cost to Lessor all necessary facilities to enable Lessor to deliver
Lessor’s royalty share of Leased Substances.

        d.

Notwithstanding the use of the term Leased Substances in this Paragraph 3, if
any other valuable metals, minerals and ores, whether similar or dissimilar to
uranium, thorium, vanadium, molybdenum, and all other fissionable materials,
compounds, solutions, mixtures and source materials, or any one of them and
which are necessarily produced in association therewith are produced and
marketed from the Leased Land, Lessor shall be paid a production royalty of 10%
of the gross sales price of such valuable metals, minerals and ores.

The above listed Royalty percentages will be paid based on the actual gross
sales proceeds received by Lessee for yellowcake, or slurry, sold and delivered
through an arms-length transaction. An arms-length transaction shall be deemed
to be a bona fide transaction with a third party purchaser, not an affiliate,
subsidiary or parent of Lessee, or other entity in which Lessee has a financial
interest.

Lessor shall be entitled to ten percent (10.00%) of the value of any benefits
obtained by or granted to Lessee which arise out of any claims or disputes
relating to take or pay contracts or any other values relative to the production
of Leased Substances hereunder.

                   4. Lessee shall market the Leased Substances produced under
this Lease as a reasonable and prudent uranium mining operator, having due
regard for the interests of both Lessor and Lessee, and consistent with industry
customs and practices.

                   5. If Lessee, through the drilling of a well or wells has
discovered uranium or other Leased Substances on the Leased Land which, in
Lessees’ opinion, is capable of being produced in commercial quantities but is
not being produced and this Lease is not being maintained otherwise as provided
herein; or if Lessee after commencement of production, periodically suspends
production or sales and stockpiles uranium or other Leased Substances for lack
of a market reasonably satisfactory to Lessee, as determined by Lessee in its
sole discretion, then this Lease shall not terminate whether it be during the
Primary or Renewal Term (unless released by Lessee), and it shall nevertheless
be considered that uranium or other Leased Substance is being produced in paying
or commercial quantities from said Leased Land provided a Shut-in Royalty is
paid. When the Lease is continued in force in this manner, Lessee shall pay or
tender as a Shut-in Royalty to the parties who at the time of such payment would
be entitled to receive Royalty hereunder if production were then occurring, a
sum of ten dollars ($10.00) per acre on the number of acres subject to this
Lease at the time such payment is made for each Lease year, or portion thereof,
that this Lease is not otherwise maintained. When the above Shut-in payment is
made, it shall serve to extend the term of said Lease for one (1) year from the
date said payment is made, whether in the Primary or Renewal Term. The first
payment of such sum shall be made on or before the first day of the calendar
month after ninety (90) days from the date the Lease is not otherwise maintained
and thereafter annually on or before each succeeding anniversary date of such
payment. Notwithstanding anything to the contrary as set forth above, Lessee
shall not be permitted to perpetuate this Lease by the payment of Shut-in
Royalty as set forth above for a period in excess of two (2) years in the
aggregate.

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                   6. If mining operations are not commenced on the Leased Land
on or before one (1) year from the date first above stated, this Lease shall
terminate unless on or before such date Lessee shall pay or tender, or make a
bona fide attempt to pay or tender to Lessor, the sum of Ten Dollars ($10.00)
per acre multiplied by the number of acres retained under this Lease
(hereinafter referred to as “Rental”), which shall cover the privilege of
deferring commencement of mining operations for a period of twelve (12) months.
In like manner and upon like payment or tender annually, the commencement of
mining operations may be further deferred for successive period of twelve (12)
months each during the Primary and Renewal Terms. The payment or tender of
Rental under this paragraph or of any other payment coming due under the terms
of this Lease may be made by cash, cashier’s check, or business check of Lessee
mailed to the parties entitled thereto on or before the due date of such
payment.

                   7. 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
forty-five (45) days after written notice of the 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. If the default is due to failure to timely pay, ineffective or erroneous
payment or deposit as described herein, this Lease shall not terminate, but
shall be maintained in the same manner as if such failure to timely pay,
ineffective or erroneous payment or deposit had been properly made, provided
that such payment is corrected within forty-five (45) days after the receipt by
Lessee of written notice by such party or parties of such error, accompanied by
such instruments as are necessary to enable Lessee to make proper payment.

                   8. If at the expiration of the Primary or Renewal Term
uranium or other Leased Substances is not being produced from said Leased Land,
but Lessee is engaged in operations directed toward the establishment or
re-establishment of production therefrom, this Lease shall remain in force so
long as such operations are prosecuted with no cessation of more than ninety
(90) consecutive days; and if the operations result in production, so long
thereafter as Leased Substances are produced from the Leased Land. If production
of Leased Substances from the Leased Land has been obtained, and such production
shall cease for any cause, whether on one or more occasion, this Lease shall not
terminate if Lessee commences or resumes operations directed towards the
re-establishment of production from the Leased Land within ninety (90) days
after cessation of production and such operations continue with no cessation of
more than ninety (90) days until production is re-established, or if it be
within the Primary or Renewal Term, commences or resumes the payment or tender
of Rentals or commences operations directed towards the re-establishment of
production on or before the Rental payment date next ensuing. The operations to
be conducted under this Lease by Lessee are a right and privilege that Lessee
shall exercise with the good faith intent of obtaining production in paying and
commercial quantities. All operational and exploration activities shall be
undertaken by Lessee with equipment capable of exploring for and producing
Leased Substances from the Leased Land, and shall be conducted with reasonable
diligence and in a good and workmanlike manner.

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                    9. If, upon the expiration of the Primary Term, no mining
operations are being conducted, and regardless of whether the Primary Term of
this Lease is extended by some other provision herein, then Lessee shall have
the right to extend this Lease for a secondary term by the payment to Lessor of
an extension bonus in the amount of sixty dollars ($60.00) per acre multiplied
by the number of acres then covered by this Lease, and upon. payment or tender,
this Lease shall automatically and without further action on the part of Lessor
or Lessee and without execution of any additional instrument, be renewed for a
term of five (5) years from and after the Primary Term hereof (hereinafter
referred to as the “Renewal Term”) and so long thereafter as Leased Substances
are being produced in paying quantities from the Leased Land or this Lease is
being otherwise maintained in accordance with the provisions herein. On or
before each anniversary date thereafter, Lessee shall pay to Lessor a delay
rental in the amount of ten dollars ($10.00) per acre multiplied by the number
of acres retained under this Lease which delay rentals shall not be recoupable
against any royalty becoming due at any time to Lessor.

                   This Lease is also granted for a continuing term as long
after the Primary or Renewal Term as any mining operations are 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 Primary or Renewal Term,
a period of ninety (90) consecutive days elapses in which no such operations are
conducted, excluding, however, periods of force majeure as provided herein.

                   10. {INTENTIONALLY LEFT BLANK}

                   11. Lessee shall have the right from time to time and at any
time to mix or commingle uranium or other Leased Substances from the Leased Land
with like substances produced from other land for transporting, treating,
processing and storing prior to or for the purpose of sale. Prior to such mixing
or commingling the uranium content or other Leased Substances content where such
are being processed for sale, of the raw ore or the amount thereof in solution
(as the case may be), shall be assayed or otherwise determined by periodic
sampling, using sound engineering principles and the volume of all solutions
produced shall be determined by adequate metering devises. For Royalty purposes,
the Leased Substances attributable to the Leased Land where such mixing or
commingling has occurred shall be a percentage of the total Leased Substances
sold by Lessee which percentage shall be determined by the relationship of
Leased Substances’ content in the production from the Leased Land, multiplied by
the volume thereof bears to the total Leased Substances’ content, multiplied by
the total volume of the mixed or commingled production from all land for the
applicable production period.

                   12. At the end of the Primary or Renewal Term, as applicable,
or upon cessation of continuous operations as authorized herein if same are
conducted beyond the Primary or Renewal Term, this Lease shall terminate and all
Leased Substances shall revert to Lessor with respect to all Leased Land which
is not at that time under continuous, commercial production of Leased Substances
or for which operations are occurring. For the purposes of such termination, the
Leased Land shall include not only the surface acreage which is not then subject
to continuous commercial production by Lessee, but also shall include all depths
within the Leased Land which is measured as those horizontal depths which are
500’ below and greater than the greatest depth penetrated by Lessee in its
commercial operations thereon. In the event of such termination, Lessee, its
successors and assigns, shall execute and deliver to Lessor and file for record
a release or releases of this Lease within ninety (90) days of the date of
termination of that portion or interval affected, in whole or in part of the
Leased Land, Leased Substances, subsurface interval or any depth thereunder, and
Lessee shall thereby be released from all obligations as to the released land,
substances, horizon, zone or formation as of the date of release SAVE AND EXCEPT
for any liabilities which theretofore accrued. If this Lease is released as to a
portion of the Leased Land, the Rental and Shut-in Royalty payments shall
thereupon be reduced in proportion to the percentage amount of surface acreage
released bears to the acreage which was covered by this Lease immediately prior
to such release. At such time as a partial termination of this Lease occurs
under this provision, and except as otherwise set forth herein, each such tract
as to which this Lease has not terminated shall be considered to be a
“separately leased tract,” in the same manner as if Lessor had executed separate
and distinct leases covering each such retained tract, and the continuation of
this Lease as to each such separately leased tract shall be determined by the
provisions of this Lease applied to each tract as if the same were separately
leased under the provisions hereof. Notwithstanding a partial termination of
this Lease under the above provisions, it is agreed that Lessee shall have and
retain such easements of ingress and egress over those lands originally covered
hereby as shall be necessary to enable Lessee to develop and operate the portion
or portions of the Leased Land as to which this Lease is then in effect for the
production of Leased Substances therefrom.

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                   13. The rights and estate of any party hereto may be assigned
from time to time in whole or in part and as to any mineral or horizon,
provided, however, that, due to the special relationship of trust and confidence
between Lessor and Lessee, any assignment, mortgage or other transfer of all or
any interest in this Lease by Lessee without the prior written consent of
Lessor, which consent shall not be unreasonably withheld, shall be void. As an
express condition to such approval as may be granted by Lessor, Lessee shall
furnish to Lessor a true or certified copy of all such assignments and fully
inform Lessor of the identity and address of any such assignee. In the event
Lessor fails to respond in writing to a request for consent to assignment
tendered by Lessee in compliance with the provisions of this paragraph 13 within
thirty (30) days of Lessor’s receipt of such request, Lessor’s consent to the
requested assignment shall be conclusively deemed to have occurred. These
provisions shall apply to any type of assignment, sublease, conveyance or
transfer of all or a portion of this Lease or rights or interest thereunder. The
provisions hereof shall extend to the heirs, executors, administrators,
successors and assigns, but no change or division in ownership of the Leased
Land, Rental, Shut-in Royalty or Royalty, however accomplished shall operate to
enlarge the obligation or diminish the rights of the Lessee or be binding upon
Lessee for any purpose until thirty (30) days after such person acquiring any
interest has furnished Lessee with the instrument, instruments or certified
copies thereof, constituting his chain of title from the original Lessor. A
permitted assignment by Lessee shall, to the extent of each assignment, relieve
and discharge Lessee of any obligation hereunder accruing after the date of such
assignment, but shall not in any respect relieve Lessee of any liabilities which
accrued prior to the effective time of such permitted assignment.

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                   14. Lessee shall have free use of a reasonable amount of
water from the Leased Land (except water from Lessor’s wells, tanks and
reservoirs) exclusively for Lessee’s operations hereunder, but not for sale or
use on other property or minerals owned by third parties. Exploration, solution
mining and restoration operations wherever situated on the Leased Land shall be
conducted so as not to damage or destroy any water supply constructed by Lessor.
In the event, however, that such activity, in order to properly explore,
solution mine and develop said Leased Land should result in damage to or in
destruction of any such water supply, if feasible in the opinion of Lessee, the
Lessee, at his option, shall repair, restore or replace any such well, tank,
reservoir or other water facility so damaged or destroyed, with reasonable
diligence and dispatch, weather permitting, or if not feasible then Lessee shall
pay to Lessor a reasonable compensation for any such damage so sustained. Any
such water facility so repaired, restored or replaced shall be of a capacity and
quality equal to that which was damaged or destroyed. Upon the termination of
this Lease, any water wells or other facilities constructed and/or owned by
Lessee with respect to water on the Leased Land, shall automatically be conveyed
free of charge to Lessor; Lessee agrees to execute any additional documents
which may be needed by Lessor to accomplish same. Lessee is prohibited from
constructing a refinery or other plant facility on the Leased Land without the
prior express written consent of Lessor after negotiating a mutually agreeable
consideration for such right. Lessee shall not have the right to dispose of salt
or waste water produced or obtained from off the Leased Land.

                   15. Lessor, or its duly authorized representatives, shall
have the right at all reasonable times and at their own risk to enter into and
upon the Leased Land and workings thereon for the purposes of examining and
inspecting the same and ascertaining whether the terms and conditions of this
Lease are being carried out and performed by Lessee, so long as such access or
inspection does not interfere with the operations of Lessee; Lessor or his duly
authorized representatives, shall at all reasonable times have access to
production records, assays and evaluation of ore records, and all other records
pertinent and necessary for substantiating the compliance of Lessee with the
provisions of this Lease. Lessor shall at all times be entitled to full
information covering all of Lessee’s operations on the Leased Land. To this end,
Lessor, through its representative or representatives duly designated from time
to time in writing, shall have free access to all operations conducted by Lessee
upon the Leased Land and, at all reasonable times, to all of Lessee’s records
and data pertaining thereto. Further, Lessee shall furnish Lessor concurrently
with submission of such reports by Lessee to any and all governmental agencies
having jurisdiction in connection with such operations. Lessee shall furnish
Lessor with copies of logs, tests, analyses, assays, or other types of
scientific or technical analyses of the Leased Substances, as well as copies of
all records of testing operations, including copies of all reservoir studies
performed including but not limited to pressure buildups, pressure draw downs,
and reservoir limits testing in any formation. All such data shall be provided
to Lessor within a reasonable time period following Lessee’s receipt thereof,
provided that all accumulated data shall be provided on at least a quarterly
basis. Lessee shall furnish to Lessor, within sixty (60) days of execution,
copies of all contracts and agreements pertaining to the sale or disposition of
Leased Substances from the Leased Land. In the event such contracts contain any
provisions which would genuinely make such contracts confidential or trade
secrets, Lessor agrees to hold such material confidential for a period of two
(2) years after the delivery of same; provided, however, if Lessor requires such
data to perform audit or to enforce Lessee’s compliance with this Lease, Lessor
shall be permitted to use such information and disseminate same to its
accountants, expert witnesses and attorneys subject to a reasonable
confidentiality agreement or order consistent with the foregoing concepts in
this paragraph. It is agreed and stipulated that neither the Lessee, its agents,
employees, contractors or subcontractors, their agents or employees, shall at
any time hunt or fish on the Leased land, nor shall they, or any of them, carry
onto the Leased Land firearms or other equipment designed or adapted for such
purpose. Lessee shall supervise its employees and agents to ensure that no
illegal drugs or other controlled substances are ever brought onto or consumed
on the Leased Land. Lessor, or its duly authorized representatives, shall have
the right at all times to inspect vehicles entering upon or leaving the Leased
Land for the purpose of ascertaining whether the provisions of this paragraph
are being carried out.

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                   16. Lessee agrees to conduct its mining operations on the
Leased Land in a prudent and workmanlike manner, abiding by all applicable State
and Federal Laws, rules and regulations. In addition, Lessee agrees to make
payment for surface usage according to the following.

  a.

To pay Lessor the sum of fifty dollars ($50.00) per exploration test hole
drilled by Lessee as FULL COMPENSATION for all damages to grass, crops and land
that occur during any exploration drilling operation.

        b.

Within sixty (60) days from the date any acreage is actually taken out of use by
Lessee, to pay to the Lessor owning the surface to that particular acreage taken
out of use, a one time sum of six hundred fifty dollars ($650.00) per acre.

        c.

Insure all welt holes will be filled, plugged, and covered with top soil as
required.

        d.

Once solution mining operations have ceased on said Leased Land and restoration
has been completed, with Lessee receiving FULL release from the governing
authority, Lessee shall return the surface configuration of the land so used to
as near the condition that existed immediately prior to Lessees operations
described herein and to deep plow the area disturbed, by methods common to the
area; if acreage is used for grazing purposes Lessee shall reseed the area so
plowed to prevent erosion with seed selected by Lessor that is consistent with
the surrounding area.

        e.

It is agreed and stipulated that no exploring or mining shall be conducted, nor
any facilities necessary to the same, constructed within three hundred (300)
feet of the main dwelling place or appurtenant structures thereto, or any
commercial buildings constructed thereon, unless the consent of Lessor, in
writing, shall have been first obtained.

                   Lessee agrees to pay to Lessor in Duval County, Texas, for
the actual damages, if any, resulting to the ranch roadways used by Lessee,
fences, gates, cattle guards, houses, barns, windmills, tanks and other
structures, trees, grass, crops, cattle and livestock caused by Lessee’s
operations or occasioned by reason of such operations or such damages as Lessor
may incur by reason of Lessee’s failure to comply with the terms of this Lease.

                   All payments made under this Lease for surface usage shall be
based on the actual acreage disturbed, rendered unharvestable or made unusable
for pasture, including the damage to any remainder thereof, and will be paid on
a per acre basis, or portion thereof. If Lessor owns a lesser interest in the
surface of the lands covered by this Lease less than the entire fee simple
estate, then any payment herein provided to be made to Lessor which relates to
the surface shall be proportionately reduced.

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                   Lessee shall deal directly with any surface tenants and pay
damages to them for use of the surface estate of the Leased Land separate and
apart from the damages specified above to be paid to Lessor. In no event shall
Lessee be responsible to pay both Lessor and its surface tenants for the same
damages to any particular portion of the Leased Land.

                   17. Lessee shall endeavor to locate any road on the Leased
Land at places mutually agreeable to both Lessor and Lessee, consistent with
Lessee’s operations. Lessor shall not make unreasonable objections to the
location that will cause undue restrictions or added costs to Lessee. All roads
shall be constructed and maintained in such a manner as to bear the traffic
necessary to Lessee’s operations, and so as not to be a barrier to the natural
drainage of the site. Upon cessation of operations by Lessee and the termination
of this Lease, all roads so constructed shall become the property of Lessor
except, however, that the Lessor reserves the option and privilege of requiring
Lessee to remove said road material from said Leased Land and to plow the
surface below ordinary plow depth by methods common to the area. Such option
MUST be exercised in writing by Lessor within ninety (90) days after the
termination of this Lease. Lessor shall have the right, at his own risk, to use
any such road so constructed by Lessee for Lessee’s use so long as this use does
not interfere with the Lessee’s use thereof.

                   18. Lessee shall keep all exterior gates on the Leased Land
closed and locked except for the ability to gain immediate access to and egress
from the Leased Land. Upon reasonable request from Lessor, Lessee shall maintain
at its expense a property guard at Lessee’s main access gate to the Leased Land,
who shall maintain a traffic log and attempt in good faith to prevent
trespassing on the Leased Land. If there are FENCES located on the Leased Land
and Lessee finds it necessary to cut any fence or fences for the purpose of
passage, Lessee agrees that prior to cutting such fence there will be installed
and braced heavy “corner-type” posts at each end of the opening to be made, to
which the fence wire will be securely fastened in such a manner as to prevent
sagging; Lessee will install a gate of a quality acceptable to Lessor in each
such opening; in the event Lessee desires that such opening provide
uninterrupted ingress and egress, then Lessee shall install therein cattle
guards of sufficient size and substance to bear the type of traffic necessary
for its operations and capable of turning all domestic livestock. If there is
livestock on said Leased Land, Lessee agrees to properly fence all pits, fixed
machinery and other hazards which it may dig, bore or construct on the Leased
Land so as not to present a hazard to such livestock. Lessee agrees to bury all
pipelines, if requested by Lessor, except those contained within a fenced area,
enclosure or wellfield, so that the top thereof is of sufficient depth so as not
to interfere with the surface operations of Lessor.

                   19. Lessee shall have the right at any time during or within
one hundred and eighty (180) days after the termination or expiration of this
Lease to remove all property and fixtures placed by Lessee on said Leased Land.
In the event the Primary and Renewal Term of this Lease have expired and
complete restoration has not been accomplished by Lessee, Lessee shall have the
right of ingress and egress over existing roads, to the acreage containing
plant, well field, monitor wells and other facilities associated with Lessee’s
operations, to complete the required restoration of the Leased Land, without
additional compensation, in accordance with Federal and State regulations.

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                   20. LESSEE AGREES TO INDEMNIFY, PROTECT AND HOLD LESSOR
HARMLESS OF AND FROM ANY AND ALL CLAIMS, DEMANDS, COSTS, (INCLUDING BUT NOT
LIMITED TO REASONABLE ATTORNEY’S FEES), EXPENSES, DAMAGES, LOSSES AND CAUSES OF
ACTION OR SUITS FOR DAMAGES ARISING OUT OF INJURY TO PERSONS (INCLUDING DEATH)
AND INJURY OR DAMAGE TO OR LOSS OF ANY PROPERTY OR IMPROVEMENTS CAUSED BY
LESSEE, ITS AGENTS, EMPLOYEES, SERVANTS, CONTRACTORS OR ANY PERSON ACTING UNDER
ITS DIRECTION OR CONTRACT. FURTHER, LESSOR SHALL NEVER BE LIABLE FOR ANY CLAIMS,
DEMANDS, COSTS, EXPENSES, DAMAGES, LOSSES AND CAUSES OF ACTION OR SUITS FOR
DAMAGES BECAUSE OF INJURY TO PERSONS OR PROPERTY ARISING OUT OF ACTS OR
OMISSIONS OF LESSEE, ITS AGENTS, EMPLOYEES, SERVANTS, CONTRACTORS, OR ANY PERSON
ACTING UNDER ITS DIRECTION AND CONTROL ON THE LEASED LAND. As used in this
Lease, the term “Hazardous Materials” means any substance defined or identified
as a hazardous, extra hazardous or toxic substance, waste, or material under any
applicable federal, state, or local statute or regulation. “Remedial Work” is
defined as any site investigation or monitoring, any cleanup, containment,
remedial, removal, or restoration work performed in response to any federal,
state or local government authority or private attorney general action, or
pursuant to any federal, state or local statute, rule regulation or other laws.
Lessee agrees (1) to remove from the Leased Land, if, as and when required by
law, any Hazardous Materials placed or released thereon by Lessee, (2) to
perform remedial work where the need therefore arises as a result of and if
caused by Lessee’s operations or activities on the Leased Land, and (3) to
comply in all respects with all federal, state and local governmental laws and
regulations governing operations by Lessee and remedial work on or associated
with the Leased Land required as a result of Lessee’s operations hereunder. Such
remedial work shall be performed by one or more contractors selected by Lessee
and approved in advance by Lessor and under the supervision of a consulting
engineer selected by Lessee and approved in advance by Lessor. All costs and
expenses of remedial work made necessary by Lessee’s operations shall be paid by
Lessee, including, without limitation, the charges of such contractors and/or
the consulting engineer and Lessor’s reasonable attorneys’ fees and costs
incurred in connection with the monitoring or review of remedial work. If Lessee
shall fail to timely commence or cause to be commenced, or fail to diligently
prosecute to completion, such remedial work, Lessor may, but shall not be
required to, cause such remedial work to be performed. Lessee promises to notify
Lessor of any claim or other action by any governmental agency or other third
party involving the actual or alleged existence of hazardous materials on the
Leased Land and to provide Lessor with copies of (1) any notice of any release
of Hazardous Materials given to Lessee pursuant to any law or regulation and (2)
any report of and response to any such incident. LESSEE AGREES TO INDEMNIFY, PAY
AND PROTECT, DEFEND AND SAVE LESSOR HARMLESS FROM ALL CLAIMS, LIABILITIES, FEES
AND EXPENSES OF ANY KIND THAT ARISE FROM THE PRESENCE OR RELEASE OF ANY
HAZARDOUS MATERIAL WHERE SUCH PRESENCE OR RELEASE RESULTS FROM AND IS CAUSED BY
LESSEE’S OPERATIONS ON THE LEASED LAND OR THE OPERATIONS OF ANY ASSIGNEE OR
SUCCESSOR OF LESSEE WHO HAS NOT BEEN PREVIOUSLY APPROVED IN WRITING BY LESSOR.
It is expressly understood that such approval of assignees or successors of
Lessee will not be unreasonably withheld and will in all cases be granted in the
case of assignees or successors who are financially responsible and experienced
in the uranium mining industry. This indemnification shall include costs in
connection with any such remedial work required as a result of Lessee’s
operations hereunder when performed by Lessor or any third party in response to
any federal, state or local governmental authority, laws or regulations, due and
payable upon demand for same by Lessor.

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                   21. Lessee shall not be liable for delays or defaults in its
performance of any agreement or covenant hereunder due to force majeure. The
term “FORCE MAJEURE” as employed herein shall mean: any act of God, including
but not limited to storms, floods, washouts, landslides and lightning; acts of
the public enemy; wars, blockades, insurrections or riots; strikes or lockouts;
epidemics or quarantine regulations; laws, acts, orders or requests of federal,
state, municipal or other governmental officers or agents acting under color of
authority; freight embargoes or failures; exhaustion, unavailability or delays
of any product, labor, service or material. If Lessee is prevented from
conducting or required to cease operations directed toward establishment or
re-establishment of production or producing operations by any order, decree,
direction, inaction or denial of permit by and federal, state or municipal law,
executive order, rule, regulation or request enacted or promulgated under color
of authority on said Leased Land, or if Lessee by other types of force majeure
is prevented from conducting operations directed toward establishment or
re-establishment of production or producing operations, then until such time as
law, order, rule, regulations, request or other force majeure is terminated or
the permit issued and for a period of ninety (90) days after such termination of
issuance, each and every provision of this Lease that might operate to terminate
it or the estate conveyed by it shall be suspended and inoperative, and this
Lease shall continue in full force and effect. If any period of suspension
occurs during the Primary or Renewal Term, the time thereof shall be added to
such term with continuing payment of annual Rental, Shut-in Royalty or Royalty
consistent with the applicable term for such period of suspension.

                   22. Lessee shall have the right to terminate this Lease at
any time or times during the term hereof, as to the Leased Substances underlying
all or any one or more parts of the Leased Land, by delivering or mailing to
Lessor written notice stating such intention to terminate and describing the
parts of the Leased Land, if less than all, as 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 date is given. Upon such
termination, all right, title, interest and obligations of Lessee hereunder in
and to the Leased Land specified in the notice shall terminate, except
obligations which then have accrued and/or which have not been paid or
performed. If the notice specifies that this Lease is hereby being terminated as
to the Leased Substances underlying a part, and less than all, of the Leased
Land, this Lease shall continue in effect as to the Leased Substances underlying
all parts of the Leased Land except the part or parts so specified. Forthwith
after delivery of the notice of termination, Lessee shall execute and record in
Duval County, Texas a formal release of this Lease as to the parts of the Leased
Land described in the notice and provide promptly a copy thereof to Lessor.

                   23. This Lease is executed without warranty by Lessor, either
express or implied. If Lessor owns an interest in the Leased Substances in and
under the Leased Land less than the entire fee simple estate therein, then the
rentals and royalties herein provided shall be reduced proportionately. Lessee,
at its option, may discharge any tax, mortgage or other lien upon the Leased
Land, and in the event Lessee does so, it shall be subrogated to such liens with
the right to enforce same and apply Rentals, Shut-in Royalty or Royalty payments
accruing hereunder toward satisfying same. Lessee shall be responsible for any
incremental appreciation in ad valorem tax value of the Leased land which is
attributable to Lessee’s operations on the Leased Land.

                   24.  {INTENTIONALLY OMITTED.}

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                   25. Any tax based on production of the herein named Leased
Substances shall be borne by Lessor and Lessee in the same proportion that each
party shares in the ownership of such Leased Substances hereunder.

                   26. The covenants made by Lessee herein shall govern its
obligations hereunder, and to the extent such express covenants conflict with
any covenants implied by law such express covenants shall control. In the event
any obligation of Lessee is covered by a covenant implied by law as of the date
of execution of this Lease Agreement but which is not covered by any express
covenant herein, the terms of such implied covenant shall be binding upon
Lessee.

                   27. Lessee’s operations hereunder shall be in compliance with
all valid and applicable laws, rules and regulations, both Federal and State,
and any agency thereof. All notices required to be given under the terms of this
Lease, including the submission of all depository, tax payor/ee or other
information, shall be given to the following persons who are designated Lessor’s
and Lessee’s respective agents:

  (a) La Palangana Ranch Management, L.L.C.           c/o Mr. Charlie Ragland,
Co-Manager     P.O. Box 646     Hempstead, TX 77445     Telephone: 979-921-0343
    Telecopier: 979-921-0343           c/o Ms. Rachel Porter, Co-Manager      
104 Fleetwood     San Antonio, TX 78232     Telephone: 210-437-0321          
c/o Ms. Carole Speed, Co-Manager       247 Pin Oak Trail     New Braunfels, TX
78132     Telephone: 830-226-5034           c/o Mr. Robert Williams, Co-Manager
    P.O. Box 23349     Silverthorne, CO 80498     Telephone: 970-390-6143      
    with a copy to:           Mr. Dan C. Perry Perry & Kellogg, LLP     7801
Broadway, Suite 200     San Antonio, Texas 78209     Telephone: (210) 821-3377  
  Telecopier: (210) 821-3388

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  (b) Everest Resource Company           Attn: Mr. Tom M. Crain, Jr.,
Vice-President     Post Office Box 1339     Corpus Christi, Texas 78403    
Telephone: 361-883-2831     Telecopier: 361-883-9628           KDH Operations
Ltd.     Attn: Mr. Tom M. Crain, Jr.     Post Office Box 1339     Corpus
Christi, Texas 78403     Telephone: 361-883-2831     Telecopier: 361-883-9628

Either party hereto may from time to time designate in writing a different
address or agent for the giving of any notice hereunder.

                   Lessee agrees to further designate in writing, mailed or
delivered to Lessor, or give notice in person to Lessor of the person or persons
to be present from time to time on the Leased land as current operations are
being conducted with whom Lessor may handle directly any claim resulting in
injury and damage to livestock, surface area or improvements on the Leased Land
occasioned by or arising from Lessee’s operations or other activity on the
Leased Land. In regard to notice of surface use or damages, Lessor shall be
entitled to reasonable prior notice of such operations.

                   28. This Agreement shall be construed in accordance with and
governed by the laws of the state of Texas, and venue for any cause of action
brought hereunder shall be in the state district court of Duval County, Texas.

                   29. If any term or provision of this Agreement is held
invalid, illegal or incapable of being enforced under any applicable rule of
law, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect.

                   30. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective legal representatives,
successors and assigns, and shall constitute a covenant running with the lands,
leases and interests covered by this Agreement.

                   31. This Agreement sets forth the entire agreement between
Lessor and Lessee, and supersedes and subsumes all prior writings, drafts,
letters and oral understandings between Lessor and Lessee.

                   32. Lessee agrees to file this Lease Agreement of record in
Duval County, Texas, and to provide Lessor with a certified copy of the recorded
counterpart thereof.

                   33. As to all of its operations hereunder, Lessee shall carry
for the benefit and protection of Lessor Comprehensive General Liability
Insurance, including contractual liability, with a combined single limit per
occurrence of not less than $1,000,000 for bodily injury and property damage.
Lessor shall be named as a loss payee under such policy, and Lessor shall be
entitled to not less than 20-days notice of any cancellation thereof. Lessee
shall provide copies of such policy and certificates evidencing the above
insurance coverage to Lessor.

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                   IN WITNESS WHEREOF, the parties hereto have executed the
foregoing In-Situ Uranium Mining Lease as of the day and year first written
above.

LESSOR:

LA PALANGANA RANCH MANAGEMENT, L.L.C.

By: ”Carol A. Speed”   Carole A. Speed, Co-Manager

LESSEE:   EVEREST RESOURCE COMPANY By: ”Tom Crain”   Tom M. Crain, Jr., Vice
President     KDH OPERATIONS LTD., By: KDH MANAGEMENT LLC,   General Partner    
By: ”Kaye D. Holt   Kaye D. Holt     Its: President

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STATE OF TEXAS § COUNTY OF BEXAR §

                   This instrument was acknowledged before me on the _24th_ day
of March, 2005, by Carole Speed in her capacity as a Co-Manager of La Palangana
Ranch Management, LLC, a Texas limited liability company, on behalf of said
limited liability company.

                   ”Lisa D. Scalf”                 
NOTARY PUBLIC, State of Texas

STATE OF TEXAS § COUNTY OF NUECES §

                   This instrument was acknowledged before me on the 31stday of
March, 2005, by Tom M. Crain, Jr., in his capacity of Vice President of Everest
Resource Company, a Texas corporation, on behalf of said corporation.

             ”Karen L. Paige”                   
NOTARY PUBLIC, State of Texas

STATE OF TEXAS § COUNTY OF NUECES §

                   This instrument was acknowledged before me on the 1st day of 
April, 2005, by Kaye D. Holt , in the capacity of  President  KDH Management,
LLC, a Texas limited liability company, general partner of KDH Operations Ltd.,
a Texas limited partnership and acknowledged to me that she executed the
foregoing instrument on behalf of said limited partnership in the capacity and
for the purposes and consideration expressed therein.

              ”Karen L. Paige”                    
NOTARY PUBLIC, State of Texas

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