Exhibit J




                JCL
                01-30-87
                780406
                                LEASE AGREEMENT

BY THIS LEASE AGREEMENT

      effective as of the 5th day of February , 1987,

      by and between H. B. LAYNE CONTRACTOR, INC., an Indiana corporation, whose
      address  is  2500  East  Hallandale  Beach Blvd., Penthouse I, Hallandale,
      Florida 33009 (the "Lessor" herein),

            and

      ST.  JOE  GOLD  CORPORATION, a Delaware corporation, whose address is 2002
      North Forbes Boulevard, Tucson, Arizona 85745 ("St. Joe" herein),

the  Lessor,  in  consideration  of the agreements set forth herein, has granted
certain rights to St. Joe under the following terms and conditions:

1.    Grant

      a.    Lease  - Lessor hereby grants, demises, leases and lets that certain
            real property, more particularly described in the attached Exhibit A
            (the  "Property"  herein),  including, but without being limited to,
            all  soil,  sand and gravel, rock, ores, minerals and mineral rights
            in,   upon   and  under  the  Property  (the  "Leased  Substances"),
            exclusively  unto  St.  Joe,  its  successors  and assigns, with the
            exclusive rights and privileges:

                  --  to  drill  and  excavate  holes,  pits,  shafts  and other
            excavations,   to   construct   roads   and   to   conduct  surveys,
            explorations,  sampling, investigations and other operations in such
            a  manner  and  to  the  extent as St. Joe, in its sole judgment and
            discretion,  may  deem advisable for the purpose of ascertaining any
            and all facts relating to the occurrence of ores and minerals in and
            under  the  Property and the metallurgical and physi- cal properties
            of any such ores;

                  -- to mine (by open pit, strip, underground, solu- tion mining
            or  any  other  method,  including  any method hereafter developed),
            extract,  mill,  store, process, remove and market Leased Substances
            from the Property;

                  --  to  place,  construct,  maintain,  use,  and  remove  such
            structures, facilities, equipment, roadways,

<PAGE>





            haulaaeways and such other improvements on the surface or subsurface
            of  the Property as St. Joe may deer necessary, useful or convenient
            for the full enjoyment of all of the rights herein granted:

                  --  to  mix or commingle Leased Substances with any other ores
            produced  off the Property, provided that St. Joe shall first weigh,
            sample,   and   assay  the  Leased  Substances  in  accordance  with
            recognized industry practice;

                  --  to  conduct  any  mining  upon  the Property and St. Joe's
            mining  of adjoining or nearby lands as a single mining operation as
            if  the  Property and all such other properties constituted a single
            tract of land, in which event St. Joe shall have the exclusive right
            to use structures, facilities, equipment, roadways, haulageways, and
            all other appurtenances installed on the Property for the purpose of
            producing, removing, treating or transporting metals, ores, minerals
            or  materials  from adjoining or nearby property owned or controlled
            by  St.  Joe and the right to mine and remove Leased Substances from
            the  Property  through or by means of shafts, openings or pits which
            may be made in or upon adjoining or nearby property;

                  --  to  use  other  resources  of  the Property (to the extent
            Lessor  has  such  rights),  including water, in connection with the
            exploration, mining and processing rights granted hereunder;

                  --  to  use  the  surface  of  the  Property to deposit waste,
            overburden,  surface  stripping  and  other  materials  from  mining
            operations  on  the Property and adjoining property being mined with
            the  Property  as  a single mining operation; provided the materials
            from  other  lands  may not be deposited on the Property if it would
            interfere with mining operations on the Property.

            h.  Sublease  - St. Joe understands and acknowledges that this Lease
      is  a  sublease as to Claims Ace 1, 2 and 3 and is subject to that certain
      "Mining Lease and Option to Purchase Agreement," entered into on August 3,
      1978,  by  and between Robert A. Revert and Claron Burnett, as Lessors and
      Kelly  Minerals,  Inc.,  as  Lessee, a copy of which is attached hereto as
      Exhibit B.

2.    Term

            Unless   sooner   terminated   under   the   termination  provisions
      hereinafter contained, the term of this Agreement shall an initial term of
      three  (3)  years  commencing  on  the  effective  date  hereof; provided,
      however, that St. Joe may


                                      -2-

<PAGE>




      extend  such  tern  by  making  the payments specified in sub-section b of
      Section 1.

3.    Payments to Lessor

            a.  Rental  -  St.  Joe  shall  pay Lessor as rental Twelve Thousand
      Dollars  ($12,000.00)  during  the  first one (1) year of the term nereof;
      Twenty  -Four  Thousand Dollars (S24,000.00) during each of the second and
      third  years  of  the term hereof; and Fifty Thousand Dollars ($50,000.00,
      per  year  during  each  year thereafter while this Agreement is in force.
      Such  payments shall be due in advance on or before the anniversary of the
      effective  date  of  this Agreement. Rental for the first year of the term
      shall be due upon final execution of this Agreement.

            b. Advance Minimum Royalty - After three, (3) years of the effective
      date  hereof,  or  such  earlier  time  St.  Joe  mines and markets leased
      substances  from  the  property,  St.  Joe shall pay Lessor Fifty Thousand
      Dollars  ($50,000.00) per annum, which shall constitute an advance minimum
      royalty  which  shall be payable in the same manner as set for above. Such
      advance  royalties  shall  be  a credit insofar as they will go toward any
      monies due Lessor under the provisions of subsection c of this Section 3.


            c.  Production  Royalty  -  If  St.  Joe  mines  and  markets Leased
      Substances  from  the  Property,  St. Joe shall pay to Lessor a production
      royalty of five percent (5%) of the "Net Returns' received by St. Joe from
      the  sale  or  other  disposition of Leased Substances; provided, however,
      that  St.  Joe  shall not be required to pay Lessor any production royalty
      under  the  terms  of this Agreement from the mining claims subject to the
      Mining Lease and Option to Purchase Agreement attached hereto as Exhibit B
      until  the  purchase  price  thereunder  has been fully paid. The term Net
      Returns"  shall mean the total dollar value received from the purchaser of
      Leased Substances, less:

                  (1)  in  the  case of sale of raw ore or concentrates: (a) any
            weighing, sampling, penalty, processing or other charges assessed by
            the  purchaser; (b) selling charges; (c) any sales, severance, gross
            production,  privilege or similar taxes assessed on or in connection
            with  the  ore or measured by the value thereof; and (d) the cost of
            transportation from the Property to the purchaser.

                  (2)   in  the  case  of  leaching  or  other  solution  mining
            techniques in addition to the deductions specified in (1) above, all
            processing and recovery costs incurred beyond the point at which the
            leaching reagents are applied to the ore being treated (including


                                      -3-
<PAGE>





            the cost of reagents) shall be deducted from the selling price.

If  ores  or  concentrates  are  processed at a smelter or other facility owned,
operated  or  controlled  by St. Joe or treated on a toll basis for St. Joe, the
selling  price  shall  be  computed  in the above manner with deductions for all
charges  and  items of cost equivalent to the deductions extended in arms-length
transactions,  and  in any case, not more than changes that would be made at the
nearest treatment facility otherwise available.

      d.  Payment  of  Production  Royalty  -  Production royalty paid to Lessor
hereunder shall be due and payable within thirty (30) days after the end of each
calendar  quarter  for  those  Leased  Substances  sold  and  a settlement sheet
received  during  the  applicable  calendar  quarter  after  first deducting any
advance  minimum  royalty  paid  under  subsection b of Section 3 not previously
recovered  from  prior  payments under this subsection d. A11 production royalty
shall be accompanied by the settlement sheets or a similar statement showing the
basis upon which the payment was computed.

      e.  Method  of  Making  Payments  - A11 payments required hereunder may be
mailed  or  delivered  to Lessor's address or to any single depository as Lessor
may instruct. Upon making payment to the authorized agent or depository, St. Joe
shall  be relieved of any responsibility for the distribution of such payment to
Lessor.  The  delivery or the deposit in the mail of any payment hereunder on or
before the due date thereof shall be deemed timely payment hereunder.

      f.  Fractional  Interest  -  A11  payments  under  this  Agreement, unless
specified otherwise, are based on a grant by Lessor of full undivided rights and
title  to  the  Property. If Lessor's interest in the Property is less than such
full  interest, all payments made hereunder shall be paid in the same proportion
thereof  as  the undivided rights and title actually owned by Lessor bear to the
entire undivided rights and title to the Property or the areas included therein.

4.    Inspection

      Lessor (or any agent of Lessor with authorization in writing), at Lessor's
risk  and  expense,  may (1) enter upon the Property to inspect the same at such
times and upon such notice to St. Joe as shall not unreasonably or unnecessarily
hinder  or interrupt the operations of St. Joe, and (2) inspect the accounts and
records  used  in calculating production royalty paid to Lessor hereunder, which
right  may  be exercised, at any reasonable time during a period of one (1) year
from and after the date on which the applicable


                                      -4-
<PAGE>





quarterly  payment  of  production  royalty was made. Lessor agrees to treat all
information  received  hereunder  as  confidential  and not to disclose the same
without prior permission of St. Joe.

5.    Obligations of St. Joe

      a.  Conduct  of Operations - A11 work performed by St. Joe on the Property
pursuant to this Agreement shall be done in a good and workmanlike manner and in
compliance  with all state or federal laws and regulations governing such opera-
tions.  The  operations  of  St.  Joe  shall be further subject to the following
special requirements:

            (1)  St.  Joe  shall pay any and all withholding and Social Security
      taxes  levied by the United States Government or unemployment compensation
      taxes  levied  by  the  Unemployment Compensation Division of the State of
      Nevada upon it as an employer and permit no delinquencies to be created;

            (2)  St. Joe shall protect all employees under the Nevada Industrial
      Insurance Act and the Nevada Occupational Diseases Act as amended, pay all
      premiums  required  by  the  laws,  rules  and regulations of the State of
      Nevada pertaining to industrial insurance;

            (3) St. Joe shall maintain records and reports and submit, according
      to  the  requirements  of  the  Inspector of Mines, reports of production,
      employment, mine activity, status, accidents, bodily injury, loss of life,
      occupational  illness  and  related  data  as  required  by Nevada Revised
      Statutes ss. 512.160 as amended.

      b.  Sublease  -  St.  Joe  hereby  assumes and agrees to keep, perform and
fulfull  all  of the terms, covenants, conditions and obligations required to be
kept,  performaed  and  fulfilled  by  the  Mining  Lease and Option to Purchase
Agreement  subleased  hereby,  including  the  making  of all payments due to or
payable to or on behalf of the lessor thereunder when due and payable, including
but not limited to advance and production royalties; provided, however, that St.
Joe  shall  have the right to surrender such Mining Lease and Option to Purchase
Agreement to the Lessor hereunder and thereby terminate any further liability or
obligation  thereunder for duties or payments not accrued as of the date of such
surrender.  Such  payments  shall  be  in  addition  to  the rents and royalties
reserved herein to the Lessor.

      c.  Weights  and  Analysis  -  In  all cases where ore or concentrates are
stockpiled  off  the  Property  or  commingled  concentrates  not mined from the
Property, St. Joe with ore or


                                      -5-
<PAGE>





shall  establish procedures for determining the proportional amount of the total
metal content in the commingled materials attributable to the input from each of
the  properties  by  calculating  on  a  metallurgical basis, in accordance with
sampling   schedules  and  mining  efficiency  experience,  so  that  production
royalties  applicable  to  materials  produced  from each of the properties from
which  materials  are  commingled  may  reasonably  be determined. St. Joe shall
inform Lessor of such procedures by written statement and shall make all records
related to such activities available for inspection by Lessor in accordance with
Section 4.

      d.  Protection  from Liens - St. Joe shall pay all expenses incurred by it
in  its  operations  on  the Property hereunder and shall allow no liens arising
from any act of St. Joe to remain upon the Property; provided, however, that St.
Joe  shall  not  be  required  to  remove  any  such  lien as long as St. Joe is
contesting in good faith the validity or amount thereof.

      e.  Indemnity - St. Joe shall protect, defend and indemnify Lessor against
and   hold   Lessor   harmless   from  any  suit,  claim,  judgment  or  demand,
administrative  proceeding or sanction, expense, including reasonable attorney's
fees, whatsoever arising out of St. Joe's exercise of any of its rights pursuant
to  this  Agreement  and  the  Mining  Lease  and  Option  to Purchase Agreement
subleased  hereby,  provided  that  Lessor, or any one of them, or any person or
instrumentality  acting  on its behalf, shall not have been a contributing cause
to  the  event giving rise to such suit, claim, demand, judgment, administrative
proceeding or sanction.

      f.  Payment  of  Taxes  -  St.  Joe shall pay all taxes levied against its
improvements  on  the  Property.  In  the event of commercial development of the
Property, St. Joe shall pay all ad valorem taxes assessed against that amount of
the Property used in such commercial development and shall, in addition, pay all
taxes  related  to production of Leased Substances from the Property, subject to
St.  Joe's  right to deduct the amount of such production-related taxes from the
dollar value received from the purchaser of Leased Substances in the computation
of  Net  Returns under the provisions of subsection c(1)(c) of Section 3. Lessor
shall  pay,  before delinquency, all other taxes and assessments on Property and
improvements  of Lessor thereof. In no event the St. Joe be liable for any taxes
levied  or measured by shall Lessor, or for taxes applicable to or levied income
of  against or based upon advance or production royalty payments to Lessor under
this  Agreement.  St.  Joe  shall  have the made in the courts or otherwise, the
validity or right to contest, taxes or assessments, before it shall be amount of
any pay the same. St. Joe shall have the right, at required to


                                      -6-
<PAGE>




its  sole  discretion,  to  pay  any  delinquent  property  taxes. together with
interest,  penalties  and  charges, that a the responsibility of the Lessor, the
payment of which shall be a credit against payments thereafter tc be made by St.
Joe  under  the  provisions  of  Section 3. If this Agreemdeent is terminated or
otherwise  expires, all ad valorem taxes that are St. Joe's responsibility shall
be  prorated  as  of  the  date  St.  Joe  has removed its improvements from the
Property or Lessor agrees to their abandonment.

      g.  Assessment  Work  -  St. Joe agrees to perform assessment work (unless
excused,  suspended  or  deferred)  for  the  benefit  of  the Property for each
assessment  year during which this Agreement continues in force beyond July 1 of
the  applicable assessment year. The work performed shall be of a kind generally
accepted  as  assessment  work,  and  St.  Joe  shall  expend  the  total amount
sufficient to meet the minim= requirements with respect to all of the unpatented
claims.  Lessor  acknowledges  and agrees that the mining claims included within
the  Property are one contiguous group and that development and exploration work
on  any one or more of the claims will be for the benefit of all of them. Lessor
further agrees that if St. Joe acquires a right to explore areas adjacent to the
Property by location, purchase, lease or option, St. Joe shall have the right to
perform  assessment  work  required  hereunder  pursuant  to  a  common  plan of
exploration or development of all the areas, claims or groups of claims, whether
performed on or off the Property.

6. Title Matters

      a.  Representations and Warranties - Lessor represents and warrants to St.
Joe that to the best of its knowledge and belief that: (1) the unpatented mining
claims  constituting  the Property have been located and appropriate record made
thereof in compliance with the laws of the United States and the laws of Nevada;
(2) the assessment work for the year ending September 1 prior to the effec- tive
date of this Agreement has been performed and appropriate record made thereof in
compliance  with  applicable law; (3) there is no valid claims of adverse mining
rights  affecting  such  claims;  (4) except as specified in Exhibit A, Lessor's
possessory   right  to  the  Property  is  free  and  clear  of  all  liens  and
encumbrances, and (5) the Lessor has the full right, power and capacity to enter
into this Agreement upon the terms set forth herein.



      b.  Title  Documents;  Data  - Upon written request of St. time during the
term  hereof, Lessor shall promptly Joe at any St. Joe all abstracts of title to
and copies of deliver to


                                      -7-
<PAGE>





all  title  documents affecting the Property which Lessor has in its possession.
If Lessor is in possession or knows the whereabouts of technical data concerning
the  mineral estate of the Property, Lessor shall, at St. Joe's expense, furnish
copies  of  such  materials to St. Joe or notify St. Joe of the location of such
information.

      c.  Title  Defects,  Defense  and Protection - If -- (1) in the opinion of
counsel  retained by St. Joe, Lessor's title to any of the Property is defective
or  less  than  as  represented  herein,  or (2) title to any of the Property is
contested  or  questioned by any person, entity or governmental agency -- and if
Lessor is unable or unwilling to promptly correct the defects or alleged defects
in  title, St. Joe may attempt, with all reasonable dispatch, to perfect, defend
or  initiate  litigation to protect such title. In that event, Lessor shall take
such  actions  as  are  reasonably necessary to assist St. Joe in its efforts to
perfect,  defend  or protect such title. If title is less than as represented in
this  Section  6,  then  (and  only  then) the costs and expenses of perfecting,
defending  or correcting title, including, but without being limited to the cost
incurred  in  the  amendment  or  relocation  of  unpatented claims, the cost of
attorney's fees and the cost of releasing or satisfying any mortgages, liens and
encumbrances),  shall  be a credit against payments thereafter to be made by St.
Joe  under the provisions of Section 3, unless the encumbrance or dispute arises
from  St.  Joe's  failure  to  perform obligations hereunder (in which case such
costs shall be borne by St. Joe).


      d.  Lesser Interest Provisions - If the rights and title granted hereunder
are  less  than  represented  herein,  St.  Joe shall have the right and option,
without  waiving  any other rights it may have hereunder, to reduce all payments
to  be  made  to  Lessor  hereunder in the proportion that the interest actually
owned by Lessor bears to the interest as represented herein.

      e.  Amendment  and  Relocation  of  Mining Claims - St. Joe shall have the
right to amend or relocate in the name of Lessor the unpatented claims which are
subject  to this Agreement which St. Joe, in its sole discretion deems advisable
to  amend  or  relocate.  St.  Joe shall not be liable to Lessor for any act (or
failure  to  act) by it or any of its agents in connection with the amendment or
relocation  of such claims as long as such act (or omission) does not arise from
gross negligence or is not made in bad faith.

      f.  Patent  Proceedings  -  Upon  request  of St. Joe at any time or times
during  the  term of this Agreement, Lessor agrees to undertake to obtain patent
to  any  or  all  of  the  unpatented  mining  claims  which are subject to this
Agreement.


                                      -8-
<PAGE>





St.  Joe  shall  prepare  all  documents  and compile all data and comply in all
respects  with  the  applicable law, all at the expense of St. Joe. Lessor shall
execute  any  and  all  documents  required for this purpose and shall cooperate
fully  with St. Joe in the patent application proceedings subsequent thereto. If
Lessor  begins  such  proceedings  and  St.  Joe  thereafter  requests Lessor to
discontinue   such  proceedings,  or  if  this  Agreement  is  terminated  while
proceedings  are  pending, St. Joe shall have no further obligation with respect
thereto  except  to pay any unpaid expenses accrued in such proceedings prior to
its request to discontinue or prior to termination, whichever occurs first.

      g. Change of Law - If the laws of the United States concerning acquisition
of  mineral  rights  on  federally  managed  lands  is repealed, amended, or new
legislation  is enacted, St. Joe shall have the right to take whatever action it
deems  appropriate  to preserve a right to explore for, develop, and mine Leased
Substances.  If  St.  Joe  elects  to  take  any  action under the terms of this
subsection,  it shall first notify Lessor in writing setting forth the nature of
the  proposed action and an explanation thereof. Lessor agrees to cooperate with
St.  Joe  and  execute  whatever  documents  are  deemed necessary by St. Joe to
accomplish  such  action. Nothing in this subsection shall impose any obligation
upon  St. Joe to take any action, or diminish the right of Lessor to take action
it  deems  appropriate;  provided,  however,  that if Lessor chooses to take any
action, it will first inform St. Joe of the nature of such contemplated action.

      h. General - Nothing herein contained and no notice or action which may be
taken  under  this  Section  6  shall  limit  or detract from St. Joe's right to
terminate this Agreement in the manner hereinafter provided.

7.    Termination; Removal of Property; Data

      a.  Termination  by Lessor - If St. Joe defaults in the performance of its
obligations  hereunder,  Lessor shall give St. Joe written notice specifying the
default.  If  the default is not cured within thirty (30) days after St. Joe has
received the notice, or if St. Joe has not within that time begun action to cure
the  default  and  does  not  thereafter  diligently  prosecute  such  action to
completion, Lessor may terminate this Agreement by delivering to St. Joe written
notice  of  such  termination, subject to St. Joe's right to remove its property
and  equipment  from  the  Property,  as hereinafter provided. Lessor's right to
terminate  this  Agreement  shall  be  its  sole  remedy for any defaults in the
payment  of rental or advance minimum royalty. If St. Joe in good faith disputes
the existence of a default, St. Joe shall initiate appropriate action in a court
of competent


                                      -9-
<PAGE>





jurisdiction  within  the  30-day period and the time to cure shall run from the
date  of a final determination that a default exists. Lessor shall have no right
to  terminate this Agreement except as set forth in this subsection a of Section
7.

      b. Termination by St. Joe - St. Joe shall have the right to terminate this
Agreement  at  any  time by written notice from St. Joe to Lessor. St. Joe shall
also  have  a  separate right of termination of its obligations under the Mining
Lease  and  Option to Purchase Agreement as set forth in subsection b of Section
5.  From and after the date of termination, all right, title and interest of St.
Joe  under  this Agreement shall terminate, and St. Joe shall not be required to
make  any  further  payments  or  to  perform  any further obligations hereunder
concerning  the  Property, except payment and obligations, the due dates for the
payment  or  performance of which occur prior to the termination date, including
the obligations related to damages to the surface and improvements thereon.

      c.  Removal  of  Property  -  Upon  any  termination or expiration of this
Agreement,  St.  Joe  shall  have  a  period  of one (1) year from and after the
effective  date  of  termination  within  which  it may elect to remove from the
Property  all of its machinery, buildings, structures, facilities, equipment and
other  property  of  every  nature  and  description erected, placed or situated
thereon,  except  supports placed in shafts, drifts or openings in the Property.
Failure  of St. Joe to so remove the same shall constitute an abandonment by St.
Joe to Lessor of the same; provided, however, that St. Joe may still be required
to  remove such property upon notice from Lessor at any time during the one-year
period and thirty (30) days thereafter.

      d.  Delivery  of  Data  -  If  this  Agreement is terminated, upon written
request  given  by  Lessor  within thirty (30) days of said termination, St. Joe
shall,  within  a  reasonable  time,  furnish  Lessor  copies  of  all available
noninterpretive  exploration,  development  and  mining  data  pertaining to the
Property prepared by or for St. Joe.


      e. Relinquishment of Record - If this Agreement is terminated or otherwise
expires,  St.  Joe shall provide Lessor with a recordable document sufficient to
provide notice that St. Joe no longer asserts rights to the Proflerty under this
Agreement.

8.    Notices

      Any notice or communication required or permitted here- shall be effective
when personally delivered or under


                                      -10-
<PAGE>





deposited,  postage  prepaid, certified or registered, in the United States mail
to the addresses specified above. Either party may, by notice to the other given
as aforesaid, change its mailing address for future notices.

9.    Binding Effect; Assignment

      The  rights  of either party hereunder may be assigned in whole or in part
and  the provisions hereof shall inure to the benefit of and be binding upon the
heirs,  personal  representatives, beneficiaries, successors and assigns, but no
change  or  division of ownership of the Property or payments hereunder, however
accomplished, shall operate to enlarge the obligations or diminish the rights of
St.  Joe  hereunder. No such change or division in the ownership of the Property
shall  be  binding upon St. Joe for any purpose until the first day of the month
next  succeeding  the  month  in  which such person acquiring any interest shall
furnish  evidence to St. Joe's satisfaction of such change, transfer or division
of ownership.

10.   Force Majeure; No Implied Covenants

      If  St.  Joe is delayed or interrupted in or prevented from exercising its
rights  or  performing its obligations, as herein provided, by reasons of "force
majeure,"  then,  and  in  all  such  cases,  St.  Joe shall be excused, without
liability,  from  performance  of  its  obligations  set forth in this Agreement
(except  as  to obligations to pay money set forth in Sections 3 and 5), but the
provisions  shall  again come into full force and effect upon the termination of
the  period  of delay, prevention, disability or condition. St. Joe shall notify
Lessor  of the beginning and ending date of any period of forree majeure and the
period  of  time required for performance under this Agreement shall be extended
for  the  period  of  the  disability. "Force majeure" includes all disabilities
arising from causes beyond the reasonable control of St. Joe; including, without
limitation,  acts  of  God,  accidents,  fires,  damages  to  facilities,  labor
troubles,   unavailability   of   fuels,   supplies  and  equipment,  orders  or
requirements  of  courts  or  government  agencies,  or  the inability to obtain
environmental   clearance   or   operating  permits  that  may  be  required  by
governmental  authorities.  It  is  expressly agreed that no implied covenant or
condition  whatsoever  shall  be  read  into this Agreement relating to any time
frame  as the measure of diligence for prospecting, mining, resumption of mining
if  mining  operations  once commenced are suspended, or any other operations of
St. Joe hereunder.

.. . .
.. . .


                                      -11-
<PAGE>





11.   Memorandum

      The  parties to this Agreement agree to execute and record a Memorandum of
this Agreement in a form sufficient to constitute record notice to third parties
of  the  rights granted hereunder, which may be recorded in the official records
of Nye County, Nevada.

12.   Construction

      a.  Governing Law - This Agreement shall be construed by the internal laws
but not the laws of conflict of the State of Nevada.

      b. Headings - The headings used in this Agreement are for convenience only
and  shall  not  be  deemed  to  be  a  part  of  this Agreement for purposes of
construction.

13.   Approval; Effective Date

      This  Agreement  shall  not  be  effective  until  it has been approved by
management of St. Joe and executed by its authorized officer. The effective date
shall be the date of such execution by St. Joe.

          SIGNED, effective as of the date recited above.

LESSOR:                                         ST. JOE:
H. B. LAYNE CONTRACTOR, INC.                    ST. JOE GOLD CORPORATION


By                                              By
  Richard        N., Lundgren                     John W. Horton
  President                                       Assistant Vice President
<PAGE>





 STATE OF FLORIDA                              )
                                               ) ss.
 County of  Broward                            )

      The  foregoing  instrument  was  acknowledged  before  me  this 5th day of
February, 1987, by Richard N. Lundgren, the President of H. B. Layne Contractor,
Inc., an Indiana corporation, for an on behalf of the corporation.




 My commission expires:                                            Notary Public
         NOTARY PUBLIC   STATE OF FLORIDA
         MY COMMISSION EYP  JUNE 24, 1989
        'BONDED THRU GENERAL INS. UND.

 STATE OF ARIZONA                              )
                                               ) ss.
 County of  Pima                               )

      The  foregoing  instrument  was  acknowledged  before  me  this 3rd day of
February,  1987, by John W. Horton, the Assistant Vice President of St. Joe Gold
Corporation, a Delaware corporation, for an on behalf of the corporation.

 My commission expires:                                            Notary Public
   My Commission expires August 15, 1990
<PAGE>






                                   EXHIBIT A





      The  "Property"  consists  of  those  certain unpatened lode mining claims
situated in the Bullfrog Mining District, Nye County, Nevada, the names of which
and  the place of record of the location notices thereof in the official records
of  the  county  recorder  and  the  authorized  office  of  the  Bureau of Land
Management are as follows:



                                                Nye Cty Rcds        BLM Serial #
Name of Claim                                   Book      Page        N  MC

Mining  claims  subject  to  the Mining Lease and Option to Pur- chase Agreement
dated  August  3,  1987,  by and between Robert A. Revert and Claron Burnett, as
lessors, and Kelly Minerals, Inc., as lessee:

 Ace No. 1                                      110       426        11229
 Ace No. 2                                      110       427        11230
 Ace No. 3                                      110       428        11231

unencumbered  mining  claims  vested 100X in the Lessor under the forgoing Lease
Agreement between H. B. Layne Contractor, Inc., and St. Joe Gold:

Golden Eagle      #   2                         424       120       298788
Golden Eagle      #   3                         424       121       298789

Golden Age #   1                                424       103       298790
Golden Age #   2                                424       104       298791
Golden Age #   3                                424       105       298792
Golden Age #   4                                424       106       298793
Golden Age #   5                                424       107       298794
Golden Age #   6                                424       108       298795
Golden Age #   7                                424       109       298796
Golden Age #   8                                424       110       298797
Golden Age #   9                                424       111       298798
Golden Age #   12                               424       112       298799
Golden Age #   13                               424       113       298800
Golden Age #   14                               424       114       298801
Golden Age #   15                               424       115       298802
Golden Age #   16                               424       116       298803
Golden Age #   17                               424       117       298804

3,5-129

                                      A-1
<PAGE>


      VIA CERTIFIED MAIL
      RETURN RECEIPT REQUESTED                            BOND  GOLD CORPORATION

                                                                 October 5, 1989


      H. B. Layne Contractor, Inc.
      Attn: S. Lee Crouch, Esq.
      1001 North Federal Highway, Suite 206
      Hallandale, Florida 33009


                Re: Lease Agreement Dated February 5, 1987

      Dear Lee:

            As  always, it was a pleasure seeing you and Dick again. I hope that
      you  were reassured that our commingling procedures are in accordance with
      standard  industry  practice, and that any questions you may have had were
      answered to your satisfaction.

            As  we  discussed  this  day,  Bond  Gold Bullfrog Inc. has recently
      "mined  and marketed Leased Substances" from the Property, thus triggering
      Bond's  obligation  to  pay  the  advance  minimum royalty provided for in
      Section  3.b.  of  the Lease Agreement dated February 5, 1987. The subject
      Section  provides  that the advance minimum royalty is payable in the same
      manner as the rental payments. From a cold reading of this provision I was
      not  entirely  clear  on the intent of the parties. As you and I discussed
      and  agreed,  the  language is ambiguous, but you have advised me this day
      that,  in  your  opinion,  the  proper  interpretation is that the advance
      minimum royalty payment is due on February 5, 1990 or at such earlier time
      that  Bond  Gold mines and markets Leased Substances from the Property and
      is to be paid in advance every twelve months thereafter.

            I  have  spoken  with  Bond  Gold's  accounting  department  who has
      informed  me  that  the  first revenues from production of gold and silver
      from the Bullfrog Mine were booked on August 31, 1989. Accordingly, I have
      enclosed  a  check  in the amount of $50,000.00 as advance minimum royalty
      under  Section  3.b.  of  the  Lease  Agreement,  and will make subsequent
      advance  minimum  royalty payments on or before each August 31st hereafter
      during the period that the Lease Agreement remains in effect.

<PAGE>






      S. Lee Crouch, Esq.
      October 5, 1989
      Page 2


            We understand that, as provided in Section 2 of the Lease Agreement,
      payment  of  the  enclosed advance minimum royalty payment will extend the
      term  of  the  Lease  Agreement  up  to  and  including  August  31, 1990.
      Furthermore, the payment each year of advance minimum royalty on or before
      the  above anniversary date will extend the term of the Lease Agreement to
      and including August 31st of the following year.

            Please  indicate  below  your  agreement regarding the effect of the
      advance  minimum  royalty  and rental payments and return one copy of this
      letter to me. Thank you for assisting in this matter.

                                                        Very truly yours,



                                                        Garry L. Miller
                                                        Manager, Land Department


                        Agreed to this 19th day of OCTOBER, 1989.

                                                    H. B. LAYNE CONTRACTOR, INC.






                 Enclosure

                 cc:    Richard N. Lundgren
                        6205 S. W. 108th Street
                        Miami, Florida 33156


<PAGE>