EXHIBIT 99.4

                          COMMERCE GROUP CORP.
                           6001 NORTH 91ST ST.
                       MILWAUKEE, WI  53225-1795
                    414/462-5310 . FAX 414/462-5312
                     Stock Symbol:  CGCO (OTCBB)

AND/OR COMMERCE/SANSEB JOINT VENTURE (Joint Venture)
AND/OR HOMESPAN REALTY CO., INC. (Homespan)
AND/OR ECOMM GROUP INC. (Ecomm)
AND/OR SAN LUIS ESTATES, INC. (SLE)
AND/OR SAN SEBASTIAN GOLD MINES, INC. (Sanseb)
AND/OR UNIVERSAL DEVELOPERS, INC. (UDI)
ALL LOCATED AT THE SAME ADDRESS




May 12, 2003



Mrs. Sylvia Machulak as an
Individual and for her Rollover
Individual Retirement Account
903 West Green Tree Road
River Hills, Wisconsin  53217

Dear Mrs. Machulak:

At today's Commerce Group Corp. (Commerce) Directors' meeting, the
Directors were informed about the confirmation and status letter you
requested from Commerce and its affiliates to establish and confirm the
amount due and the collateral pledged to  the Sylvia Machulak Rollover
Retirement Account (SM RIRA) as of Commerce's fiscal year ended March 31,
2003.  Today, Commerce's Directors approved, ratified and confirmed the
contents of this letter and authorized me to authenticate and confirm the
outstanding obligations due to Sylvia Machulak as an
individual/consultant (SM) and the SM RIRA as of Commerce's fiscal year
ended March 31, 2003, which are as follows:

1.  Promissory Notes and Other Obligations

    A series of open-ended, secured, on-demand promissory notes (Notes)
    are due to the SM RIRA.  Their combined amount is $429,390.72 as of
    March 31, 2003.  These Notes bear interest, payable monthly, at the
    rate of 3% over the prime rate established from time to time by the
    First National Bank of Chicago, Chicago, Illinois, (now Bank One),
    but not less than 16% per annum (Schedule of Principal and Interest
    as of March 31, 2003, Exhibit A).  Commerce is no longer issuing
    monthly promissory notes for the payment of interest, etc., but
    pursuant to our understanding, Commerce is adding these liabilities
    or deducting any payments to the current open-ended, secured,
    on-demand, outstanding promissory note(s).

<PAGE>

Mrs. Sylvia Machulak
Sylvia Machulak
Rollover Individual Retirement Account
May 12, 2003
Page 2 of 7 Pages


2.  Amounts Due to Sylvia Machulak as an Individual (SM)

    As of September 30, 2000, a sum of $201,600 (72 months at $2,800 per
    month) is due to SM for consulting services rendered pursuant to a
    Director resolution adopted on October 20, 2000.  The Directors
    further acknowledge the continuance of SM's services at a sum of
    $3,000 per month beginning on October 1, 2000, and continuing until
    such time as terminated by the Directors or the President.
    Therefore, the amount due to SM as of March 31, 2003, is $291,600 (72
    months at $2,800 and thirty months at $3,000).  Reference is made to
    Exhibit B included in the April 5, 1996 confirmation letter.

3.  Transactions During the Fiscal Year with SM or the SM RIRA, Commerce,
    and its Subsidiaries

    There were no non-routine transactions during this fiscal year ended
    March 31, 2003.

4.  Collateral Pledged to the SM RIRA

    The collateral specifically pledged to the SM RIRA is as follows:

    a.  A Collateral Pledge Agreement executed by Commerce on December
        31, 1981 granted to the SM RIRA by Commerce pledging 48,645 SLE
        common shares, par value $0.50 a share, Certificate No. 25, dated
        December 31, 1981, together with a letter agreement dated
        December 31, 1981.  Reference is made to Exhibit 4 in the April
        9, 1990 confirmation letter.

    b.  General Lumber & Supply Co., Inc. (GLSCO), Edward L. Machulak
        (ELM), as an individual and not as a Director or Officer of
        Commerce the Edward L. Machulak Rollover Individual Retirement
        Account (ELM RIRA) and the SM RIRA collectively and individually
        identified as the lender(s), have been assigned on October 19,
        1987, all of the rights, titles, claims, remedies and interest in
        the Joint Venture, and to the mine concession granted by the
        Government of El Salvador to Mineral San Sebastian, S.A. de C.V.
        (Misanse) on July 23, 1987, and thereafter from time to time
        amended, and which Misanse then assigned to the Joint Venture on
        September 22, 1987.  This collateral specifically includes all of
        the San Sebastian Gold Mine (SSGM) precious metal ore reserves.
        Commerce and the Joint Venture have the right to assign this and
        any subsequent concession agreement. Reference is made to Exhibit
        4(a) included in the April 9, 1990 confirmation letter.
        Effective February 1996, the Government of El Salvador approved a
        revised version of the mining law.  Therefore, Commerce applied
        for the SSGM concession applicable to the 1996 mining law.  This
        concession is subject to compliance requirements, which have been
        presented to the El Salvador Director of Hydrocarbons and Mines.
        Therefore, it is clearly understood that the 1996 concession, and
        all of the rights thereunder, in addition to the concession
        granted on July 23, 1987, together with all of the precious metal
        ore reserves, are pledged as collateral to the above named
        parties, and also SM.

<PAGE>

Mrs. Sylvia Machulak
Sylvia Machulak
Rollover Individual Retirement Account
May 12, 2003
Page 3 of 7 Pages


        On September 6, 2002, at a meeting held with the El Salvador
        Ministry of Economy in the City of San Salvador, El Salvador,
        Central America, an agreement was reached to renew the SSGM
        exploitation concession/license for a period of 30 years under
        the 1996 revised mining law and thereafter amended.  The existing
        SSGM exploitation concession would be cancelled and the Renewed
        SSGM Exploitation Concession/License would be granted after
        compliance with the application requirements.  On September 26,
        2002, Commerce submitted an application to the El Salvador
        Department of Hydrocarbons and Mines (DHM) for the Renewed SSGM
        Exploitation Concession/License consisting of 1.2306 square
        kilometers for a period of 30 years.

        Then, on November 6, 2002, Commerce filed a S.E.C. Form 8-K,
        which reported that on or about October 30, 2002, Commerce filed
        applications to obtain the New SSGM Exploration
        Concession/License consisting of 40.7694 square kilometers and
        for the Nueva Esparta Exploration Concession/License consisting
        of 45 square kilometers.

        On or about March 3, 2003, the Office of the El Salvador Ministry
        of Economy, through its DHM, delivered two concessions/licenses.
        The Renewed SSGM Exploitation Concession/License for the
        extraction of precious metals from the SSGM consisting of
        approximately 1.2306 square kilometers for a period of 30 years
        should be granted.

        This concession is subject to certain procedural requirements
        such as providing advertisement notices in two of El Salvador's
        newspapers at different time intervals and two notices in the
        Diario Oficial newspaper.  Also, public notice has to be
        submitted to the mayor of Santa Rosa de Lima.  After, a waiting
        period, an inspection of the property is to be made by the DHM,
        and then a contract is entered into with the DHM and the
        concession/license is to be issued.


<PAGE>

Mrs. Sylvia Machulak
Sylvia Machulak
Rollover Individual Retirement Account
May 12, 2003
Page 4 of 7 Pages



        On or about March 3, 2003, the DHM did issue a New SSGM
        Exploration Concession/License for the 40.7694 square kilometers
        of area surrounding the Renewed SSGM Exploitation
        Concession/License area.

        Commerce's Directors have on this date authorized and directed
        Commerce's Officers to assign all of the rights, titles, claims,
        remedies and interest it has in the following (Exhibit B):

        1.  The Joint Venture; and
        2.  The New SSGM Exploration Concession/License consisting of
            40.7694 square kilometers granted by the DHM of the El
            Salvador Ministry of Economy under its Resolution No. 27 on
            February 24, 2003; and
        3.  When issued by the DHM, the Renewed SSGM Exploitation
            Concession/License consisting of 1.2306 square kilometers.

        to GLSCO, ELM, the ELM RIRA, the SM RIRA and SM, collectively and
        individually, as collateral for the outstanding loans as of March
        31, 2003, and all future advances of any kind.  This substitution
        is authorized as the SSGM concession/license issued on July 23,
        1987 and assigned to the lenders on October 19, 1987 has been
        cancelled and is in the process of being replaced with the
        Renewed SSGM Exploitation Concession/License and the New SSGM
        Exploration Concession/License.

5.  Cross Pledge Collateral Agreement

    GLSCO, ELM, the ELM RIRA and the SM RIRA individually are entitled to
    specific collateral that has been pledged to them by Commerce, its
    subsidiaries, affiliates and the Joint Venture.  Upon default by
    Commerce, or its subsidiaries or affiliates or the Joint Venture,
    then GLSCO, ELM, the ELM RIRA and the SM RIRA have the first right to
    the proceeds from the specific collateral pledged to each of them.
    Commerce, its subsidiaries, affiliates and the Joint Venture, also
    have cross-pledged the collateral without diminishing the rights of
    the specific collateral pledged to each of the following:  GLSCO,
    ELM, the ELM RIRA and the SM RIRA.  The purpose and the intent of the
    cross pledge of collateral is to assure GLSCO, ELM, the ELM RIRA and
    the SM RIRA, that each of them would be paid in full; thus, any
    excess collateral that would be available is for the purpose of
    satisfying any debts and obligations due to each of the named
    parties, including SM.  The formula to be used (after deducting the
    payments made from the specific collateral) is to total all of the
    debts due to GLSCO, ELM, the ELM RIRA, the SM RIRA and SM, and then
    to divide this total debt into each individual debt to establish each
    individual's percentage of the outstanding debt due.  This percentage
    then will be multiplied by the total of the excess collateral to
    determine the amount of proceeds derived from the excess collateral
    and then the amount due to each of them would be distributed
    accordingly.

<PAGE>

Mrs. Sylvia Machulak
Sylvia Machulak
Rollover Individual Retirement Account
May 12, 2003
Page 5 of 7 Pages


6.  Cancellation of Inter-Company Debts Upon Default

    Since part of the collateral pledged to GLSCO, ELM, the ELM RIRA and
    the SM RIRA is the common stock of Homespan, Ecomm, Sanseb, SLE,
    Misanse, UDI and the interest in the ownership of the Joint Venture,
    Commerce agreed, upon default of the payment of principal or interest
    to any of the individual lender(s) mentioned herein, that it will
    automatically cancel any inter-company debts owed to Commerce by any
    of its wholly-owned subsidiaries or affiliates or the Joint Venture
    at such time as any of the stock or Joint Venture ownership is
    transferred to the collateral holders as a result of default of any
    promissory note.

7.  Guarantors

    This agreement further confirms that Commerce and all of the
    following are guarantors to the obligations due to SM and to the
    loans made by the SM RIRA to Commerce:  Joint Venture, Homespan,
    Ecomm, SLE, Sanseb and UDI.  They jointly and severally guarantee
    payment of the note(s) that they issued and also agree that these
    note(s) may be accelerated in accordance with the provisions
    contained in the agreement and/or any collateral or mortgages
    securing these notes.  Also, Commerce, all of its subsidiaries and
    the Joint Venture agree to the cross pledge of collateral for the
    benefit of GLSCO, ELM, the ELM RIRA, the SM RIRA, and SM.  Reference
    is made to Exhibit 5 included in the April 9, 1990 confirmation
    letter.

8.  Re-Execution Agreement

    In the event the SM RIRA and/or SM deems that it is necessary or
    advisable for the SM RIRA and/or SM to have Commerce re-execute any
    document(s) entered into, including, but not limited to the
    promissory note or collateral agreement, Commerce will re-execute
    such document(s) reasonably required by the SM RIRA and/or SM.
    Commerce also acknowledges that Commerce may be liable to pay certain
    costs related to any of the transactions entered into with the SM
    RIRA and/or SM.  If at a later date the SM RIRA and/or SM determines
    that an error has been made in the payment of such costs to the SM
    RIRA and/or SM, then the SM RIRA and/or SM may demand payment and
    Commerce does hereby agree to make such payment forthwith.  All
    requests for corrections of any errors and/or payment of costs shall
    be complied with by Commerce within seven (7) days of the SM RIRA's
    and/or SM's written request.   The failure of Commerce to comply with
    Commerce's obligation hereunder shall constitute a default and shall
    entitle the SM RIRA and/or SM to the remedies available for default
    under any provisions of the agreements including, but not limited to
    the promissory note and/or the collateral pledge agreement and/or any
    other Commerce obligation.

<PAGE>

Mrs. Sylvia Machulak
Sylvia Machulak
Rollover Individual Retirement Account
May 12, 2003
Page 6 of 7 Pages



9.  Omissions

    Commerce believes that it has included all of its obligations, monies
    due and has listed all of the collateral due to the SM RIRA and/or
    SM, however, since these transactions have taken place over  a long
    period of time in which changes could have taken place, it is
    possible that inadvertently some item(s), particularly collateral,
    could have been omitted.  If that should prove to be a fact, then
    Commerce, the Joint Venture, Homespan, Ecomm, SLE, Sanseb, and UDI
    agree that those omissions of collateral, if any, are meant to be
    included as collateral under this confirmation agreement.

If you are in agreement with the contents of this letter, please sign
below and return one copy to Commerce.

Very truly yours,

COMMERCE GROUP CORP.

/s/ Edward A. Machulak

Edward A. Machulak
Secretary

<PAGE>

Mrs. Sylvia Machulak
Sylvia Machulak
Rollover Individual Retirement Account
May 12, 2003
Page 7 of 7 Pages


The contents of this letter are agreed by the following:

COMMERCE/SANSEB JOINT VENTURE              HOMESPAN REALTY COMPANY, INC.
as Guarantor (Joint Venture)               as Guarantor (Homespan)

/s/ Edward L. Machulak                     /s/ Edward L. Machulak
______________________________             _____________________________
By:  Edward L. Machulak,                   By:  Edward L. Machulak,
     Auth. Designee                             President


ECOMM GROUP INC.                           SAN LUIS ESTATES, INC.
as Guarantor (Ecomm)                       as Guarantor (SLE)

/s/ Edward A. Machulak                     /s/ Edward L. Machulak
______________________________             _____________________________
By:  Edward A. Machulak,                   By:  Edward L. Machulak,
     President                                  President


SAN SEBASTIAN GOLD MINES, INC.             UNIVERSAL DEVELOPERS, INC.
as Guarantor (Sanseb)                      as Guarantor (UDI)

/s/ Edward L. Machulak                     /s/ Edward L. Machulak
______________________________             _____________________________
By:  Edward L. Machulak,                   By:  Edward L. Machulak,
     President                                  President


Accepted by:                               Accepted by:

/s/ Sylvia Machulak                        /s/ Sylvia Machulak
______________________________             _____________________________
Sylvia Machulak                            Sylvia Machulak
Rollover Individual                        as an individual
Retirement  Account                        Date:  May 12, 2003
Date:  May 12, 2003

<PAGE>


                    Exhibit A to Exhibit 99.4
    (Schedule of Principal and Interest as of March 31, 2003
          has been purposely omitted as it only reflects
         the calculations of the principal and interest.)



<PAGE>

                                EXHIBIT B


                                Assignment

     For and in consideration of the sum of One Dollar ($1.00) and other
 good and valuable consideration such as, but not limited to, the
 continuance of extending the open-ended, secured, on-demand promissory
 note(s) issued by Commerce Group Corp. (Commerce) in hand paid, the
 receipt of which is hereby acknowledged, Commerce does hereby sell,
 assign and transfer to General Lumber & Supply Co., Inc., a Wisconsin
 corporation, Edward L. Machulak, as an individual and not as a Director
 or Officer of Commerce, the Edward L. Machulak Rollover Individual
 Retirement Account, the Sylvia Machulak Rollover Individual Retirement
 Account, and Sylvia Machulak, as an individual, all who reside in the
 County of Milwaukee, State of Wisconsin, individually and collectively
 referred to as "Note Holders," all of Commerce's rights, titles, claims,
 remedies, and interests in and to the Commerce/Sanseb Joint Venture and
 to the New San Sebastian Gold Mine Exploration Concession/License
 consisting of 40.7694 square kilometers granted by the Director of
 Hydrocarbons and Mines of the El Salvador Ministry of Economy under its
 Resolution No. 27 on February 24, 2003, and more fully described in an
 English translation (of which a copy is attached hereto and referred to
 as Exhibit 1) and Commerce further agrees to transfer, when issued by
 the El Salvador Director of Hydrocarbons and Mines, the Renewed San
 Sebastian Gold Mine Exploitation Concession/License consisting of 1.2306
 square kilometers, which application has been admitted by the El
 Salvador Director of Mines on February 28, 2003 (Exhibit 2), and the
 lease agreement by and between Mineral San Sebastian, Sociedad Anonima
 de Capital Variable, and Commerce dated January 14, 2003 (Exhibit 3).

     Commerce further acknowledged that Commerce's Directors unanimously
 adopted this Assignment by a resolution on May 12, 2003 and that the
 purpose of this Assignment is to provide collateral to the
 above-described Note Holders.

     This Assignment shall extend to the full term remaining on the above
 concession and license and in any amendments, renewals, changes or
 extensions thereof.

     Witness its hand and seal, this 12th day of May, 2003.

                              COMMERCE GROUP CORP.

                              /s/ Edward L. Machulak
                              -----------------------------
                              Edward L. Machulak, President

                              /s/ Edward A. Machulak
                              -----------------------------
                              Edward A. Machulak, Secretary

State of Wisconsin  )
                    )  ss.
County of Milwaukee )

     On this 12th day of May, 2003, before me, personally appeared Edward
L. Machulak, President and Edward A.  Machulak, Secretary of Commerce
Group Corp., to me known to be the persons described in, and who executed
the foregoing instrument, and acknowledged that they executed the same as
their free act and deed.


                              /s/ Sylvia Machulak
                              -----------------------------------
                              Sylvia Machulak
                              Notary Public, Milwaukee County, WI
                              My commission expires June 11, 2006



<PAGE>


                            EXHIBIT 1

MINISTRY OF ECONOMY
Republic of El Salvador

RESOLUTION No. 27

DIRECTORATE OF HYDROCARBONS AND MINES OF THE MINISTRY OF
ECONOMY:  San Salvador at 9:00 AM of the day February 24, 2003.

Having seen the application presented the day of October 30,
2002 by Dr. Jose Antonio Alfaro Castro, adult, Lawyer, from
this city, acting in his capacity as General Legal Attorney for
the Company "COMMERCE GROUP CORP." through which it applies for
a minerals Exploration License called "SAN SEBASTIAN" of an
area of 40.77 square kilometers identified on the cartographic
sheet number 2656-IV NW, known as Santa Rosa de Lima in the
Department of La Union, and Nueva Esparta in the Department of
Morazan respectively.

CONSIDERING:

1.  That the application being found in legal format, in
    conformance to Article 38 of the Mining Law, an inspection
    was done in the requested area by Delegates of this
    Directorate the day of February 13, 2003 which turned out
    favorable;

2.  That the legal existence of the Company COMMERCE GROUP
    CORP.  is found to be proven in legal documents and the
    capacity with which Dr. Jose Antonio Alfaro Castro acts,
    and having complied with all of the requirements that the
    Mining Law Articles 36, 37 number 1 and Article 38
    establishes, and  at the petition of the applicant, this
    Directorate considers it procedurally correct to accede to
    what is applied for;

THEREFORE:

For what was stated above and in conformance to what is
disposed in Articles 4, 6, 13, and 19 of the Mining Law, this
Directorate:

<PAGE>

RESOLVES:

1.  CONCEDES an Exploration License for the exploration for
    minerals, specifically gold and silver, to the Company
    COMMERCE GROUP CORP. on the area called  SAN SEBASTIAN with
    a surface extension of 40.77 square kilometers identified
    on the cartographic sheets numbers 2656 IV and 2657 III
    known as Santa Rosa de Lima in the Department of La Union
    and Nueva Esparta in the Department of Morazan
    respectively, and whose technical description is the
    following: The project starts on vertex A whose coordinates
    are 278,000 latitude and 611,000 longitude this vertex is
    located on the land just on the peak of the La Calavera
    Hill at 700 meters to the Northeast of Las Marias Village
    and the North margin of the Las Marias River, from this
    vertex and with a straight North direction and at a
    distance of 6 kilometers is located vertex B whose
    coordinates are: 284,000 latitude and 611,000 longitude,
    this vertex is located in the El Raicero Village  to the
    South of El Tigre Mountain and North of El Conto Mountain;
    from this vertex and with a straight East direction and at
    a distance of 7 kilometers is located vertex C whose
    coordinates are 284,000 latitude and 618,000 longitude,
    this vertex is located between the East flank of the Los
    Caguamos Hill and the West flank of the La Pedregosa Hill
    and to the Southwest of the El Farallon Hill, from this
    vertex and with a straight South direction and at a
    distance of 6 kilometers vertex D is arrived at, whose
    coordinates are: 278,000 latitude and 618,000 longitude,
    this vertex is located on the East margin of the Santa Rosa
    River at 1.5 kilometers from the city of Santa Rosa de
    Lima, from this vertex and with a straight West direction
    and at a distance of 7 kilometers vertex A is arrived at,
    where the present description started.  The area described
    covers an area of 42 square kilometers from which are
    subtracted 1.23 square kilometers that correspond to the
    area of the exploitation concession applied for by the same
    Company, granting in t he requested Exploration License an
    area of 40.77 square kilometers.

2.  The Company in reference should comply with what is
    disposed in Articles 17, 18, 19, 21 and 22 of the Mining
    Law, its Regulations and other dispositions related to such
    activity;

3.  The Owner should start his exploration work in conformance
    to his technical program of exploration presented to this
    Directorate;

4.  The Exploration License is granted for a period of four
    years starting to count from the day following the
    notification of this Resolution, being able to expand and
    prolong it at the judgment of this Directorate for the
    period that the Law indicates;

5.  The Owner should pay the surface tax in advance during the
    first month of each year of exploration in conformance to
    what is established Article 9 fifth paragraph and 66 second
    paragraph of the Mining Law.

NOTIFY


                          SIGNATURE
                   GINA NAVAS DE HERNANDEZ
                          DIRECTOR


<PAGE>


                            EXHIBIT 2

MINISTRY OF ECONOMY
DIRECTORATE OF HYDROCARBONS AND MINES
REPUBLIC OF EL SALVADOR

DIRECTORATE OF HYDROCARBONS AND MINES of the MINISTRY OF ECONOMY: San
Salvador, at 8:15 AM of the day February 28, 2003

Admits the application presented the day of September 26, 2002 by Doctor
Jose Antonio Alfaro Castro adult, Lawyer, from this city, acting in his
capacity as General Legal Attorney for the Company "COMMERCE GROUP CORP"
through which it applies for a minerals Exploitation Concession,
specifically gold and silver, on a surface extension of 1.23 square
kilometers known as "SAN SEBASTIAN MINE" situated on the Hacienda San
Sebastian and San Sebastian El Coyolar, jurisdiction of Santa Rosa de
Lima, Department of La Union, identified on the cartographic sheet number
2656-IV NW, known as Santa Rosa de Lima and whose technical description
is the following:  Starting from the most visible point and of easy
access that is the Ochocientos Perez tunnel that constituted the main
entrance to the works of exploitation at its lowest point.  From this
tunnel and in direction to the South, twenty one degrees East and for a
distance of two hundred sixty two meters is located Station Zero that
constitutes the beginning of the perimeter of the concession.  Station
Zero is marked on the land by a marker of cement of fifty centimeters of
free or visible height and of square section whose sides are also fifty
centimeters.  Station Zero can also be located from the central part,
from the installations of the old mineral mill, access to Station Zero
one follows a narrow path or mule trail from El Comercio or the house of
Mr. Faustino Benitez with approximate direction of South West up to the
right or North margin of the Santa Rosa River approximately four point
five vertical meters above the bank of the river, Station Zero thusly
located, four more stations are located in a semi parallel line to the
Santa Rosa River.  Directions and distances from where is measured in a
direction to the South of forty eight degrees thirty minutes West with a
distance of three hundred fifty three meters sixty five centimeters.  In
order to facilitate of these stations are the following: From Zero
Station to Station One, in direction South sixty six degrees zero three
point two minutes West and a distance of one hundred twenty four meters
forty six centimeters, from Station One to Station Four, in direction to
the South, seventy nine degrees one minute West, and a distance of five
hundred six meters sixty eight centimeters.  In Station Four the
perimeter of the area of the concession changes direction to a general
direction of North-West and its different stations are located on the
Western sides of the San Sebastian, Salazar and Cosiguina Hills.  There
are sixteen stations with markers on this Western side of the concession
which are distributed on the "land" in the following manner: From Station
Four to Station Six, direction North, fifty two degrees thirteen point
two minutes West and a distance of one hundred sixty two meters twenty
one centimeters.  From Station Six to Station Eight, direction North
forty three degrees, twenty five point two minutes West, and a distance
of one hundred ninety one meters ninety two centimeters; from Station
Eight to Station Nine, direction North forty seven degrees twelve point
two minutes West and a distance of two hundred thirty five meters ninety
four centimeters.  From Station Nine to Station Ten direction North,
forty three degrees nineteen point six minutes West and at distance

<PAGE>

of forty five meters thirty centimeters; from Station Ten
to Station Eleven, direction North forty one degrees thirty five point
one minutes West at a distance of ninety four meters sixty five
centimeters; from Station Eleven to Station Twelve, direction North
twenty three degrees twenty point eight minutes West at a distance of
forty two meters ten centimeters.  From Station Twelve to Station
Thirteen, direction North twenty three degrees eight point three minutes
West at a distance of fifty four meters eighty three centimeters; from
Station Thirteen to Station Fifteen, direction North twenty three degrees
thirty nine point two minutes West at a distance of two hundred forty
meters twelve centimeters; from the Station Fifteen to Station Sixteen,
direction North twenty two degrees forty three point three minutes West
at a distance of one hundred fourteen meters ninety three centimeters;
from Station Sixteen to Station Seventeen, direction North twenty one
degrees twenty nine point six minutes West at a distance of one hundred
twenty eight meters thirty eight centimeters; from Station Seventeen to
Station Eighteen, direction North twenty seven degrees fifteen point
seven minutes West at a distance of seventy meters twenty seven
centimeters; from Station Eighteen to Station Nineteen, direction North
thirty degrees zero two point three minutes West at a distance of thirty
eight meters  seventy nine centimeters; and from Station Nineteen to
Station Twenty, direction North seventeen degrees fifty one point one
minutes West at a distance of forty meters six centimeters.  The North
limit of the perimeter of the concession is delimited among the Stations
Twenty to Forty Four varying in direction between the directions
North-East North South and East-West approximately.  These variations are
due principally to the demarcation of the properties between the Hacienda
San Sebastian and the Hacienda Macay and in part to the broken topography
of the land.  The twenty four marked stations on this North side of the
concession are located on the North and North West flank of the Cosiguina
Hill, North flank of the West Summit Hill and top of the East Summit Hill
and Conception Hill.  The distribution of the different stations on the
land is as follows: From Station Twenty to Station Twenty Two, direction
North fifty one degrees forty seven point two minutes East at a distance
of two hundred ninety six meters fifty centimeters; from Station Twenty
Two to Station Twenty Three, direction North eighty four degrees seventy
eight point five minutes East at a distance of twenty one meters four
centimeters; from Station Twenty Three to Station Twenty Five, direction
South four degrees twenty three point five minutes East at a distance of
one hundred eighty nine meters forty eight centimeters; from Station
Twenty Five to Station Twenty Six, direction South twenty two degrees
fifty four point one minutes East at a distance of fourteen meters sixty
eight centimeters; from Station Twenty Six to Station Twenty Seven,
direction South fifty two degrees thirty six point one minutes West at a
distance of forty four meters fifty five centimeters; from Station Twenty
Seven to Station Twenty Eight, direction South eighty nine degrees twelve
point two minutes East at a distance of sixty meters ninety eight
centimeters; from Station Twenty Eight to Station Twenty Nine, direction
North eighty three degrees fifty three point six minutes East at a
distance of fourteen meters and fifty seven centimeters; from Station
Twenty Nine to Station Thirty, direction South seventy degrees forty two
point five minutes East at a distance o f eighty meters fifteen
centimeters; from Station Thirty to Station Thirty One, direction South
sixty one degrees fifty five point six minutes East at a distance of one
hundred forty two meters seventy five centimeters; from Station Thirty
One to Station Thirty Three, direction South eighty eight degrees seven
point six minutes East at a

<PAGE>

distance of two hundred forty meters forty seven centimeters; from
Station Thirty Three to Station Thirty Four, direction South sixty one
degrees sixteen point four minutes East at a distance of fifty one meters
three centimeters; from Station Thirty Four to Station Thirty Five,
direction North seventy six degrees thirteen point six minutes East at a
distance of thirty nine meters seven centimeters.  From Station Thirty
Five to Station Thirty Six, direction North sixty eight degrees thirty
point six minutes East at a distance of twenty three meters; from Station
Thirty Six to Station Thirty Seven, direction South eighty eight degrees
thirty three point seven minutes East at a distance of one hundred seven
meters ninety four centimeters; from Station Thirty Seven to Station
Thirty Eight, direction South sixty five degrees fifty six point two
minutes East at a distance of one hundred ten meters ninety eight
centimeters; from Station Thirty Eight to Station Thirty Nine, direction
South sixty one degrees seventeen point four minutes East at a distance
of twenty nine meters thirty six centimeters; from Station Thirty Nine to
Station Forty, direction north seventy seven degrees forty two point
eight minutes East at a distance of one hundred eighty meters thirty
centimeters; from Station Forty to Station Forty Two, direction North
eighty five degrees forty three minutes at a distance of one hundred
seventy four meters sixty two centimeters; from Station Forty Two to
Station Forty Three, direction South eighty six degrees six minutes East
at a distance of one hundred eleven meters sixty four centimeters; from
Station Forty Three to Station Forty Four, direction North eighty one
degrees six point one minutes East at a distance of twenty two meters
sixty eight centimeters.  The perimeter of the concession is completed
upon uniting Station Forty Four with the starting Station Zero. This line
represents the Eastern limit of the concession and its stations are found
on the sides of the Eastern flank of the Conception Hill and the area of
the Migueles.  The original orientation of this North-East line and its
fourteen stations are distributed on the land as follows: From Station
Forty Four to Station Fifty Five, direction South fourteen degrees five
point two minutes West at a distance of six hundred sixty four meters
seventy two centimeters; from Station Fifty Five to Station Fifty Seven,
direction South sixteen degrees fifty four point four minutes West at a
distance of one hundred ninety six meters seventy one centimeters; from
Station Fifty Seven to Station Fifty Eight, direction South thirty
degrees three minutes East at a distance of fifteen meters ninety five
centimeters; and from Station Fifty Eight to Station Zero, direction
South two degrees fifty eight point seven minutes West at a distance of
thirty meters forty five centimeters. All of the stations or markers are
of cement of fifty centimeters of visible height and are of square form
whose sides also are fifty centimeters.

The exploitation of the mine should be done taking into account the
security measures necessary for the housing that is located within the
concession area requested and the housing that is located contiguous to
the exploitation faces should be relocated prior to the start up of the
exploitation activities.

In Open Pit exploitation operations (clearing, cutting and taking out the
material) the work faces should have manageable geotechnical and
geometric conditions, where the angle of stability or slope of the final
bank and the exploitation should be taken into account, stability of the
face of the bank and the foot of the bank, the width and height of the
banks will conform taking into consideration the geometrical properties
of the

<PAGE>


material that is being worked, at the same time control should be had of
the drainage system of the area of exploitation and influence through a
topographic model at a representative scale (1:100) that allows location
of engineering works for the management of surface waters and drainage of
acid waters from the mine, all of the above should be considered in the
design for the exploitation and execution, in such a manner that it
allows establishing the criteria for the factor of security for the
operators of the mine in the case that the bank caves in and the failure
of the bank does not cause the loss of human life and materials.

In underground exploitation, the workers should have access to the
surface through at least two different exits solidly established,
adequately signed, and easily accessible for the workers in the interior
of the mine.  The tunnels where work is done should be equipped and
maintained in such a manner that the workers can work and circulate
through them with minimum risk, at the same time they should be signed to
facilitate the orientation of the workers. Adequate support should be
placed in the tunnels, except where the stability of the terrain does not
make it necessary for the security of the workers.  All of the under
ground access works authorized should maintain ventilation and lighting
adequately, that allows keeping a sufficient margin of security and
health for the workers.

To guarantee the security of the workers in the different operations of
exploitation of the mine, the workers should be provided the instruments
of security and the necessary training, especially in the techniques of
use, handling and storage of explosives.

And in fulfillment of what is established in Article 40 of the Mining
Law, PUBLISH the corresponding notice.  NOTIFY.

                             SIGNATURE
                      GINA NAVAS DE HERNANDEZ
                             DIRECTOR



<PAGE>


                            EXHIBIT 3

NUMBER SEVENTEEN.   In the city of San Salvador, at sixteen hundred hours
of the day of January 14, 2003, before me Jose Antonio Alfaro Castro,
Notary, of this place, appears Mr.  Edward Leon Machulak, seventy six
years of age, Business Executive, of North American nationality, with
domicile in the city of Milwaukee, State of Wisconsin, United States of
America, whom I know and identify with ordinary passport number, acting
on one hand in his capacity as Legal Representative of the Company
"MINERAL SAN SEBASTIAN, SOCIEDAD ANONIMA DE CAPITAL VARIABLE, in his
capacity as President of the Board of Directors and on the other hand is
present at this same meeting in his capacity of Legal Representative of
the North American Company "COMMERCE GROUP CORP." organized in
conformance with the laws of the State of Delaware, United States of
America in his capacity as President and at the same time Legal
Representative and SAYS TO ME: that both Companies have agreed to hold
for/of common interest and convenience a LEASE CONTRACT which will govern
in the future by the following clauses and conditions that are mentioned
below:  I) DECLARATION OF DOMINION.  The company MINERAL SAN SEBASTIAN,
SOCIEDAD ANONIMA DE CAPITAL VARIABLE that henceforth will be called
MISANSE is owner of the rustic assets called Hacienda San Sebastian and
San Sebastian El Coyolar, inscribed under number One hundred Fifteen to
One hundred twenty one of Book Ninety five of the Property Registry of La
Union that are described as:  Hacienda Mineral San Sebastian, El Mango,
El Faro, El Manto, El Zalazar, El Zunzapote, Consuelo and La Granadilla,
property which is situated in the jurisdiction of Santa Rosa de Lima,
Department of La Union and borders in its entirety:  to the East with the
Hacienda de Arias, to the North with lands of Saturnino Flores and the
Salvadores; to the West with the Hacienda Trompina, and to the South with
the Camarones River and lands of Candelaria Albornoz, being this property
by nature rustic; five rights to lands that belong to the company in
undivided land rights on the Hacienda San Sebastian Coyolar by nature
rustic and at the point El Aguacate going toward the ravine of the
Ujustes in the jurisdiction of Santa Rosa de Lima, Department of La
Union, bordering said Hacienda, in the East with the Hacienda Santa Rosa,
to the South with the Hacienda Candelaria Albornoz; to the West with the
Hacienda San Jose Velis and to the North with the Hacienda El Coyolar;
four undivided rights to the Hacienda San Sebastian being the surface
capacity of three rights of thirty manzanas or that is about two thousand
one hundred areas, and the borders of the entire Hacienda San Sebastian
are: to the North with Hacienda El Coyolar, to the South with the
Hacienda Candelaria Albornoz; to the West with lands of Pablo Melgares
and to the East with lands of Santa Rosa; seven tenths of a land of about
eighty manzanas of capacity, of a rustic nature, located in the place
called San Sebastian, under the title of Hacienda El Coyolar, in the
points called Paso del Ujuste de Nogues, Lomas de Capalillo and Pena de
Zopilote of the jurisdiction of Santa Rosa, Department of La Union,
bordering: in the East with lands of Victor Escobar, Antonio Marcia and
Francisco Ferman, in the West with lands of the succession of the
deceased Matias Conde and Butter Salvador Mines Inc. Ltd., to the North
with lands of Reyes Ortiz and Ireneo Andrade and to the South with lands
of the cited Company.  Two lands by nature rustic included under the
title of the Hacienda El Coyolar located in the jurisdiction of Santa
Rosa de Lima, Department of La Union and in the place called San
Sebastian, the one of about forty manzanas that is twenty eight hectares
bordering; in the East with lands of Anita Lazo, to the North with lands
of Salome Melgares, river in between, to the West with lands recognized
by Victor Fuentes; and to the South with lands of Ambrosio Flores and
Evelina Herrera, before Santiago Melgares, on which land as was said is
rustic, the other land has a capacity of about eleven hectares and twenty
areas and are two tenths part of a land that in its entirety borders; on
the East with lands of Messrs. Victor Escobar, Antonio Marcia and
Francisco Ferman; in the North with lands of Reyes Ortiz and those that
were of Ireneo Andrade; in the West with lands that belonged to the
successors of Matias Conde; and in the South with lands of Butter
Salvador Mines Limited, all in the Hacienda El Coyolar.  Within the
perimeter of the lands of the related properties there exists eight mine
portals called: the first Seiscientos Miguel, the second Cuatrocientos
Miguel, the third Trescientos Taladron, the fourth Santa Elena, divided
in numbers one and two, the fifth Cien Limon, the sixth El Aceituno, the
seventh El Cino and the eighth Trescientos Miguel and others that are
abandoned and whose name has not been able to be identified.  On said
properties are found  the mines "San Sebastian", "Seiscientos Miguel",
"Cuatrocientos Miguel", "Trescientos Miguel", and "Trescientos Taladron",
"Santa Elena Numero Uno", "Santa Elena Numero Dos", and "Cien Limon", "El
Aceituno:, "San Sebastian", "El Mango", "El Faro", "El Manto", "El
Salazar", "El Sunzapote", "Consuelo", "La Granadilla", "Aurora" and
others that do not have a name or denomination.  Over said mines MISANSE
has mining rights or ownership, some of which are stated in the
certifications of the acts of granting the concession, and delivery and
possession of mines, surveyed in the District (Canton) of San Sebastian,
jurisdiction of Santa Rosa de Lima, Department of a Union, inscribed in
the Book of Advice of the Department of Economic Promotion of the
Ministry of Economy, the first at twelve hours of the twenty fourth of
November of One thousand nine hundred sixty one to the Folios nineteen,
twenty and twenty one, and the second at twelve hours on January 12, 1962
(one thousand nine hundred sixty two), to the Folio twenty three to
twenty four.  II) DELIVERY UNTO LEASING OF THE OBJECT OF THE CONTRACT.
The Company MISANSE, the lessor,

<PAGE>

delivers and gives in character of leasing through this document to the
Company COMMERCE GROUP CORP, that will be called the "lease holder" and
the latter thus receives all the mining items and rights that correspond
to it over the mines mentioned before, as well as over all of the others
over which claims would have been made or of having had any other right
of exploitation or exploration within the area of the lands described
before and those that are adjacent or contiguous, as it is the purpose of
both companies that within the lease all the mines remain included that
exist within the area of the same lands  described before or adjacent
ones.  III) RIGHTS OVER DISCOVERY OF NEW VEINS IN FUTURE EXPLORATIONS.
It is agreed by both parties that if in the course of the explorations on
the included lands and that are property of the lessor, new veins are
discovered the lessor will follow the corresponding paper work in
accordance with the requirements of the law in this material and in the
mining works and labors, the lease holder will employ preferentially the
members of the lessor that know this kind of mining labor and the
expenses will be on the account of the lease holder.  IV) USES AND RIGHTS
THAT THE LEASE COVERS. The lease covers the right of use of all the lands
necessary for the construction and use of buildings, for offices, mills
and operations, rivers and wells that were or that are opened in the
future, as well as also the transport, loading and unloading of the ore,
use of roads or construction of new roads necessary for the mining work
and any other type of similar need for the works of exploration or
exploitation of the metallic or non-metallic mineral deposits.  It is
agreed that the lessor will give facilities to the lease holder so that
there are no obstacles in the mining works and especially that there not
exist the intermission of third parties that create obstacles to said
mining labors.  V) OBLIGATIONS OF THE LESSOR.  MISANSE may not during the
validity of the term of the LEASING, LEASE OR SUB-LEASE the lands
included and that have been referred to previously, to give them in loan
or use or constitute duties on them.  VI) TERM OF THE LEASE.  The term of
this contract is for thirty years starting counting from the day that the
Directorate of Hydrocarbons and Mines of the Ministry of Economy grants
the authorization for exploitation that is now found in processing and
will be extendable for one or more equal periods, always and when, the
obligations are fulfilled that emanate from this contract and are
contained in the stipulated clauses, and in the case of not continuing
the lease will communicate in writing with sixty days of anticipation of
termination of the initial term, or for its extensions, its desire to
have it terminated.  VII) PRICE AND FORM OF PAYMENT.  The lease holder
will pay to the lessor as the price of the lease a sum of money
equivalent to FIVE PERCENT of the net sales that are obtained from the
exploitation of the mines based on the market price, annual; that in no
case will the payment be less than THREE THOUSAND COLONES per month; the
lessor will have the right to the lease holder informing him each
semester about the production and other data relative to values, price
and marketing of the production. VIII) RIGHTS AND OBLIGATIONS OF THE
LEASE HOLDER.  The lease holder will carry out the work of exploration
and exploitation under its own account and risk and in accordance with
its economic possibilities and will use the technical methods required
for such an end; have legal security during the term of the lease that
there will not be actions that make difficult the process of production,
as well as any kind of interruption on the part of third parties or by
the lessor himself.  The lease holder at his own discretion may cede or
pass to third persons t he rights derived from this contract without it
being necessary to get the permission of the lessor after fulfilling the
requirements that the law establishes.  IX)  CAUSES FOR TERMINATION OF
THE CONTRACT.  The present contract will be cancelled for the following
reasons: a) when the lease holder stops paying the agreed price in the
way in which it was stipulated, b) through cancellation of the concession
before the term granted, c) for non-compliance with the obligations
contained in the present contract, d) if the Government of El Salvador
declares the concession worn out and finished or cancels it before the
stipulated term, e) because the lease holder suspends the exploitation of
the mines for the term that the Mining Law establishes, except for force
majeur or a fortuitous case duly proven in the judgment of the competent
authorities.  X)  It is understood that at the end of the original
concession or of its extensions as the case may be, the mines,
improvements, and everything existing in them will return to the domain
of the lessor without his having to indemnify the lease holder.  To carry
out its work the lease holder under its own responsibility and cost will
import the materials, apparatus, equipment, tools, vehicles, spare parts,
office equipment, chemical products and other kinds of substances needed
for the processing of the minerals and production, in addition it will
enjoy those benefits that the laws grant for this class of activity in
conformance with the Agreements that the corresponding and competent
organizations issue.  XI)  The Government will supervise the process of
exploitation or exploration of the minerals through the Directorate of
Hydrocarbons and Mines of the Ministry of Economy, the Ministry of the
Environment and Natural Resources with the end that the regulatory
dispositions in the material be fulfilled, as well as also the other
organizations of the State concerning the marketing, export and other
processes necessary for the production of the extracted minerals.  For
the performance of its functions, the competent officials will have free
access to the installations of the mine to prove truthful compliance with
the regulatory dispositions, as well as also to obtain the information
necessary for that end.  XII) Any disagreement that results from the
interpretation of the present contract and that could not be resolved
through direct dealing by the contracting parties; will have a maximum
term of thirty days starting on the day on which the problem came up,
otherwise this will be by means of arbitrators that will be named one
each by the parties, within

<PAGE>

ten days following the date that one of them notifies the other in
writing of his intention to resolve the case through arbitrators; if the
required party does not do it, in its absence said naming of an
arbitrator will be made by the First Mercantile Court of San Salvador
within the term of ten days of receiving the injunction, and the decision
of the arbitrators will not be subject to appeal.  The lessor will leave
without effect any other contract that it may have agreed to previously.
For the legal effects of this contract the contracting parties indicate
as special domicile that of this city and to the jurisdiction of whose
tribunals they expressly submit.  Thus the declarer expressed in his
capacity as Legal Representative of both Companies and I, the signed
notary, Swear: a) Being legitimate and sufficient the character with
which he acts for the Company MISANSE for having had in view: a)
Attestation of the publicly registered Constitution of MINERAL SAN
SEBASTIAN, SOCIEDAD ANONIMA granted at twenty hours of the day May 8th,
1960 before the services of the Notary Miguel Angel Aparicio and
inscribed to Number One of the Commercial Registry that was carried out
during this year in the First Instance Court of Santa Rosa de Lima; b)
Attestation of publicly registered Modification granted at nineteen hours
and thirty minutes of the day January 25th, 1965 before the services of
Notary Jose de la Paz Villatoro, inscribed to Number twenty five of Book
Sixty One of the Companies Registry of the Registry of Commerce where the
social capital was increased, and whose denomination is that indicated,
that the President of the Board of Directors is the Legal Representative
who can sign contracts such as the present one with the authorization of
the Board of Directors.  c) Attestation of publicly registered
Modification granted in this city at seventeen hundred hours of the day
November 11, 1986 before the official services of Notary Roberto Romero
Pineda, inscribed to Number One of the Book Five Hundred Forty Four of
the Registry of Companies of the Commercial Registry; d) Attestation of
publicly registered Modification granted in this city at twelve hours and
thirty minutes of the day February 8, 1990 before the official services
of the Notary Roberto Romero Pineda, where it was transformed from fixed
capital to variable capital, inscribed to Number Thirty Three of the Book
Seven Hundred Eighty Six of the Companies Registry of the Registry of
Commerce; e) Attestation of publicly registered Modification for increase
of social capital, granted in this city at seventeen hundred hours of the
day March 31st, 1994, before the official services of the Notary Sandra
Margarita Bennet Herrarte, inscribed to Number Thirty Seven of the Book
One Thousand Fifty Two of the Companies Registry of the Registry of
Commerce; B) Certification of the Minutes (Acta) number Five General
Ordinary Meeting of Shareholders held the day of January 12, 2003 from
which it is shown that Mr. Edward Leon Machulak was elected President of
the Board of Directors for the period of one year.  C) Certification of
the sole point of the Minutes of the Session of the Board of Directors in
which it is authorized to the one appearing to sign in the name of the
Company, the present contract, both issued by the Secretary of the Board
of Director s, Engr. Luis Limay Pita, still not inscribed in the
respective register. II) Being legitimate and sufficient the character
with which he acts as Legal Representative of the Corporation, COMMERCE
GROUP CORP. having had in view:  a) the attestation of the public
registry of the Constitution of COMMERCE GROUP CORP. incorporated in
conformance to the laws of the state of Delaware, the day of September
14, 1962 and the articles that govern it.  In said registered document it
states that the President is the Legal Representative and has the
capacity to grant acts such as the present one.  Certification of
election of the President where Mr. Edward Leon Machulak was elected for
a period of three years, said nomination being in force. Said documents
are written in Spanish.  I explained the legal effects of this instrument
and read as I could, entirely in a single act ratify its contents and we
sign.  I SWEAR. Between lines-I-always-wanted-The Lessor leaves without
effect any other contracts that have been agreed to previously. - General
Ordinary Shareholders' Meeting. Valid-Amended-the
assets-operation-construction-net
sales-that-earnings-transformed-appearing before-this-construction-Valid.
Between lines-that in no case will the payment be less than THREE
THOUSAND COLONES per month-Valid.

/s/ Edward L. Machulak           /s/ Jose Antonio Alfaro Castro