Equipment Purchase Agreement dated October 18, 2003



 Exhibit 10.2 
  
 STERLING MINING COMPANY 
  
 Sunshine Mine 
  
 October 18, 2003 
  
 “Equipment Purchase Agreement” 
  
 It is hereby agreed, that Sterling Mining Company will pay to ARl the sum of $396,000US, in consideration for all mine equipment as specified in Exhibit 2 of this agreement (with the exception of the Austin Crane). This sum will be paid in
six monthly installments of $66,000US. 
  

	 	•	 	Installment #1 was paid to ARI on October 17, 2003. 

  

	 	•	 	This agreement includes additional equipment, beyond the scope of the list negotiated between Demotte and Mori in Reno, Nevada. These additions are specified in Exhibit 2 of this
agreement. 

  

	 	•	 	Sterling Mining Company agrees to the terms as presented by ARI in the letter of October 9, 2003 (see Exhibit 1). 

  

	 	•	 	Sterling Mining Company agrees to extend the date for removal of remaining ARI property to January 15, 2004. 

  

	 	•	 	As noted in the second paragraph of Item l of Exhibit l, the value of the additional equipment is equal to 213 of the pre-agreed payment. Hence; Sterling retains a $22,000 credit
within the payment structure. This credit is nearly equal to the offer of $20,000.00 extended for purchase of all remaining ARI warehouse inventories (see final note in Exhibit 2). Further, Sterling assumes ARI has agreed to this figure as the
purchase price for any remaining warehouse inventories on the Sunshine Mine site after the deft of January 15, 2004. 








 Exhibit 1 
  

			
	Subj:	 	Re: equipment
	Date:	 	10/9/03 12:19:04 AM Mountain Daylight Time
	From:	 	andy@grundman.net
	To:	 	Kshiell@aol.com

 Sent from the Internet (Details) 
  
 Kevin: 
  
 I hope that this email finds you in- rood spirits. Hearing the genset spinning on Saturday, and the subsequent news that you have made it to 3700 level is extremely
promising. Congratulations on overcoming at least the initial obstacles on what will be an extremely large undertaking!! 
  
 I have been instructed by Ray to forward the following documents to you for your consideration. 
  
 Follows is the text of the letter transmitted to Ray regarding the sales agreement. The document is drafted in WordPerfect, so I have
cut & pasted the agreement. 
  
 VIA FAX TO (208) 676-1629

  
 Ray DeMotte 
 STERLING MINING COMPANY 
 411 Couer d’Alene Avenue, Suite 1-A 

Couer d’Alene, Idaho 83814 
  

	RE:	Revised List and Terms of equipment Sale; Letter as Agreement 

  
 Dear Mr. DeMotte: 
  
 Following my meeting with Sterling employees at the Sunshine Mine on October 4, 2003, we reviewed the equipment subject to the proposed sale. This
letter may be considered the agreement between ARI and Sterling Mining that covers the sale of these equipment. 
  
 1. The sales price for the equipment will be $396,000.00 U.S. this price is derived from the price negotiated at the Reno meeting plus the additional
equipment/credit allowance provided for in my letter to Ray Demotte of October 6, 2003. As discussed in that letter, the additional equipment requested would be added to the list (with the exception of the Austin Crane), and this would provide
a slight credit balance in Sterling’s favor. This would allow additional equipment to be added to the list without having to renegotiate a payment schedule. 
  
 The reason for incorporating the additional month of payments is primarily because the valuation of the additional
equipment, combined with the additional 5-ton and 1-1/2 ton loci places the additional value at approximately 2/3 of the pre-agreed payment. Additionally, the consumption of $2500 to $3000 worth of solvent used to clean the hoist “genset”
will be incorporated into this agreement, negating an additional invoice for the material. Accordingly, it appears extremely likely that over the next several months that Sterling will require additional parts and materials not included in this
purchase agreement. 







 2. As we discussed in the October 6, 2003 letter, Sterling will be permitted to in corporate
additional items into the purchase, but any item on the list, or subsequently added by Sterling would not be removable. Additionally, this equipment and materials is subject to ARI’s standard policy of “as is, where is.” 

 
 3. As mentioned above, the addition of two locis is covered under this
agreement. As also mentioned above, the Austin Crane will remain ARI’s property, but Sterling will be provided use of the crane as necessary whenever the crane is available. Additionally, SPMI will be allowed use of a suitable forklift as
necessary. Cooperation between SPMI, ARI, and SMC is mutually understood to be in the best interest of all companies. 
  
 4. With the above-noted exceptions, the Offer from SMC dated October 5, 2003 will be the primary exhibit to this agreement. The one differentiation
from the offer is that the 60 days provided for removal of remaining ARI property will be extended until January 15, 2004, and will be understood that inclement weather or snow conditions will permit this period to be extended. 
  
 It is extremely exciting to see the progress made at the mine by
Sterling’s directors and employees. On behalf of both SPMI and ARI, I would like to express our distinct approval of the success thus far, and wish for continued success in the rehabilitation and operation of the famous Sunshine Mine.

  

	
	 Sincerely,

	
	 
	ANDREW GRUNDMAN
	General Manager
	Sunshine Mining Company









 Exhibit 1 
  
 STERLING MINING COMPANY 
  
 Sunshine Equipment Offer 
  
 October 5, 2003 
  

									
	 Miscellaneous
	  	1	  	600 Rotary Compressor	  	10,000	  	Orig. Purchase
					
	 Miscellaneous
	  	1	  	Diesel Forklift w/paperhead	  	18,000	  	Orig. Purchase
					
	 Miscellaneous
	  	1	  	Gas Forklift w/paperhead	  	5,000	  	Orig. Purchase
					
	 Lower Yard
	  	2	  	12B Muckers	  	4,000	  	Orig. Purchase
					
	 Lower Yard
	  	1	  	Tugger	  	800	  	Orig. Purchase
					
	 Lower Yard
	  	4	  	1/2-Ton Motors	  	24,000	  	Orig. Purchase
					
	 Lower Yard
	  	1	  	Jumbo	  	30,000	  	Orig. Purchase
					
	 Lay Down Yard
	  	4	  	Air Operated Gates/Cons Bin	  	24,000	  	Orig. Purchase
					
	 Lay Down Yard
	  	5	  	60-Ton Coolers	  	10,000	  	Orig. Purchase
					
	 Lay Down Yard
	  	1	  	New Pan Feeder	  	15,000	  	Orig. Purchase
					
	 Fab Shop
	  	1	  	M8 Pump	  	300	  	Orig. Purchase
					
	 Fab Shop
	  	2	  	Wire Feed Welders	  	3,000	  	Orig. Purchase
					
	 Fab Shop
	  	1	  	Electric Forklift	  	20,000	  	Orig. Purchase
					
	 Fab Shop
	  	1	  	Generator Set	  	500	  	Orig. Purchase
					
	 Fab Shop
	  	1	  	Welder	  	1,000	  	Orig. Purchase
					
	 Fab Shop
	  	8	  	Air Hoist	  	8,000	  	Orig. Purchase









									
	 Fab Shop
	  	1	  	1/2-Ton Motor	  	6,000	  	Orig. Purchase
					
	 Fab Shop
	  	1	  	Charger	  	500	  	Orig. Purchase
					
	 DD Core Shed
	  	4	  	22 Muckers	  	40,000	  	Orig. Purchase
					
	 DD Core Shed
	  	1	  	12B Mucker	  	2,000	  	Orig. Purchase
					
	 Pipe Yard
	  	1	  	LM56 Mucker	  	8,000	  	Orig. Purchase
					
	 Carp/Oil Room
	  	1	  	Sump Pumps	  	3,000	  	Orig. Purchase
					
	 Carp/Oil Room
	  	2	  	20HP Sump Pumps	  	8,000	  	Orig. Purchase
					
	 Carp/Oil Room
	  	2	  	10HP Sump Pump	  	3,000	  	Orig. Purchase
					
	 Carp/Oil Room
	  	6	  	30HP Slushers	  	21,000	  	Orig. Purchase
					
	 Carp/Oil Room
	  	2	  	Charger	  	1,000	  	Orig. Purchase
					
	 Saw Mill/Hoist
	  	1	  	Large Tugger	  	1,500	  	Orig. Purchase
					
	 Saw Mill/Hoist
	  	5	  	30HP Pumps	  	9,000	  	Orig. Purchase
					
	 Sand Tank
	  	6	  	Small Air Pumps	  	1,200	  	Orig. Purchase
					
	 Sand Tank
	  	6	  	M15 Pumps	  	2,400	  	Orig. Purchase
					
	 Sand Tank
	  	1	  	3HP Flygt Pump	  	1,500	  	Orig. Purchase
					
	 Sand Tank
	  	7	  	6-Ton Motors	  	42,000	  	Orig. Purchase
					
	 Sand Tank
	  	2	  	5-Ton Motors	  	10,000	  	Orig. Purchase
					
	 Sand Tank
	  	3	  	6-Ton Motor	  	36,000	  	Orig. Purchase
					
	 Warehouse
	  	1	  	Rebuilt Controller	  	7,000	  	Orig. Purchase
					
	 Sand Tank
	  	3	  	Chargers	  	3,000	  	Orig. Purchase
					
	 Sand Tank
	  	1	  	HUL Tugger	  	1,500	  	Orig. Purchase
					
	 Saw Mill/Hoist
	  	5	  	Chargers	  	5,000	  	Orig. Purchase









									
	 Saw Mill/Hoist
	  	1	  	1-Ton OH Hoist	  	400	  	Orig. Purchase
					
	 Car Shop
	  	1	  	Kabota Tractor	  	2,000	  	Orig. Purchase
					
	 Car Shop
	  	1	  	Lg Pipe Machine	  	2,000	  	Orig. Purchase
					
	 Car Shop
	  	1	  	Small OH Hoist	  	500	  	Orig. Purchase
					
	 Car Shop
	  	1	  	5-Ton OH Hoist and Trolley	  	5,000	  	Orig. Purchase
					
	 Car Shop
	  	1	  	Hydraulic Press Welder	  	1,000	  	Orig. Purchase
					
	 Oil Room
	  	1	  	15HP Joy Air Slusher w/Bucket	  	4,000	  	Orig. Purchase
					
	 Oil Room
	  	5	  	30HP Slushers	  	3,500	  	Orig. Purchase
					
	 Oil Room
	  	1	  	Shot Crete Machine	  	1,500	  	Orig. Purchase
					
	 Oil Room
	  	1	  	Charger	  	1,000	  	Orig. Purchase
					
	 Fab Shop
	  	1	  	1-Ton OH Hoist	  	400	  	Orig. Purchase
					
	 Mechanic Shop
	  	2	  	Lathe	  	5,000	  	Orig. Purchase
					
	 Mechanic Shop
	  	Lot	  	Tools for Lathe	  	2,000	  	Orig. Purchase
					
	 Mechanic Shop
	  	1	  	Pressure Washer	  	1,500	  	Orig. Purchase
	
	EQUIPMENT ADDITIONS
					
	 Timber Yard
	  	1	  	Austin Crane	  	8,000	  	5,000
					
	 Timber Yard
	  	Lot	  	Jewel Shaft Timber	  	 	  	3,000
					
	 	  	1	  	300HP Borehole Fan	  	 	  	0 (Part of Operation)
					
	 	  	1	  	200HP 37 Level Fan	  	 	  	0 (Part of Operation)
					
	 Fab Shop
	  	1	  	Hobart 400 Welder	  	 	  	500
					
	 Carp/Oil Room
	  	2	  	110 gal. Fuel Trucks	  	 	  	400









									
					
	Carp/Oil Room	  	8	  	Timber Trucks	  	 	  	2,000
					
	 Hoist Room
	  	1	  	30KW Gen Set	  	 	  	5,000
					
	 Core Shed Yard
	  	Lot	  	12ft Pump Column and Shaft Pipe	  	 	  	2,950
					
	 Sand Tank
	  	1	  	Clam Mucker	  	1,500	  	750
					
	 	  	6	  	Serumie Pumps	  	 	  	12,000
					
	 	  	12	  	Vent Fans	  	 	  	8,400
					
	 	  	4	  	Jumbo Tires	  	 	  	0 (Incl. w/Jumbo)
					
	 6 Door Building/ Core Shed
	  	All	  	Vent Fans Except New 440 Volt Fan	  	 	  	0 (Part of Operation)

  

	 	•	 	Warehouse Basement 

  
 SMC retains full inventory with the exception of all electrical, cables which will become property of ARI. 
  

	 	•	 	Warehouse Main Floor 

  
 SMC retains all parts for fixed infrastructure and 50% of bearing inventory, as well as 50% of conventional mining equipment parts inventory. ARI is
awarded all bolt inventory and threaded pipe inventory. 
  

	 	•	 	Warehouse Upper Floor 

  
 SMC retains all parts relating to hoists, hoist controls and fixed infrastructure. SMC retains 50% of loci parts inventory. ARI is awarded 50% of the loci
parts inventory and all of the common electrical hardware and grinding wheels. 
  

	 	•	 	LOCI CAR SHOP 

  
 SMC retains 50% inventory and all shop machines and tools except for two small pipe fitting machines and bronze bar/mild steel stock. ARI receives 50% of
parts inventory, two small pipe fitting machines and all bronze bar/mild steel stock. 
  
 NOTE: 
  
 All inventory
belonging to ARI must be removed from Sunshine mine site within 60 days of the signing of this agreement, however as a second option SMC will offer to pay an additional $20,000 as payment in full for any remaining ARI inventories. In the event ARI
experiences a shortage of available storage space, SMC agrees to make available storage space in the six-stall building near the core shed for a period of 6 months from the signing of this agreement. SMC further agrees to provide two employees, for
not more than 30 working days per employee, for a total of 480 man hours, to assist ARI in removal of merchandise from the site. 







 Signature Page 
  
 This document is the complete and final agreement relating to the sale of equipment at the Sunshine mine. 
  

									
	STERLING MINING COMPANY	 	 	 	 
					
	 Representative ` 
	 	 /s/
	 	 	 	 	 	 Date October 15, 2003

			
	AMERICAN RECLAMATION, INC.	 	 	 	 
					
	 Representative ` 
	 	 /s/
	 	 	 	 	 	 Date 10-23-03