Document:

Filed by Automated Filing Services Inc. (604) 609-0244 - Banyan Corporation - Exhibit 10.20

January 16, 2006 

Dear Marshall: 

RE: Offer of Employment : Chief Operating Officer,
Banyan Corporation 

We are pleased to make you the following offer of employment
which becomes effective upon the closing of the acquisition of Premier Medical
Group: 

	1. 	
      Position Title: 

	 	
       

		
      Chief Operating Officer (COO), Banyan Corporation
      (Company). 

	 	
       

	2. 	
      Reporting: 

	 	
       

		
      The COO will report to the Chief Executive Officer,
      Banyan Corporation, and the President and CFO, Banyan Corporation.
  

	 	
       

	3. 	
      Scope of Responsibility 

	 	
       

		
      The COO will have the overall responsibility for the day
      to day operations for Banyan’s subsidiary companies, including but not
      limited to: Chiropractic USA (CUSA), Diagnostic USA (DUSA), and, subject
      to the purchase, Premier Diagnostic. Principal responsibilities are as
      follows: 

	 	
       

		
      Chiropractic USA 
Marketing 

		
      New Business Growth and Development 
Administration
      

		
      Operations – under the direction of the President, CUSA
      
Training – under the direction of the President, DUSA 

	 	
       

		
      Diagnostic USA 
Operations
      
Training
Marketing 

		
      Growth and Development 
Administration 

	 	
       

		
      Premier Diagnostic 
Oversight 

	 	
       

		
      Note: a detailed Business Plan will be developed and
      approved by the CEO, President, and COO to clearly define the business
      expectations on an annual basis. 

	4. 	
      Location: 

	 		
		
      The COO will operate out of Banyan’s Corporate Head
      Office in Calgary, AB. 

	 		
	5. 	
      Start Date: 

	 		
		
      The start date will be February 1, 2006. 

	 		
	6. 	
      Base Salary: 

	 		
		
      The base salary for the position will be 120,000 USD per
      year and on-going salary treatment will be in accordance with then current
      Company compensation policies. The first salary review will occur July 1,
      2006. 

	 		
	7. 	
      Bonus: 

	 		
		
      The COO is eligible to earn a Monthly Bonus based on the
      following terms: 

	 		
		
      • 
	
      upon Premier Health earning EBITDA in excess of 1.7
      Million USD per annum under the following rates:

	 	  
	  
	 1. 
	 Monthly EBITDA of 0-141,666
        USD 

	 	  
	  
	  
	 • 
	 No Bonus 

	 	  
	  
	 2. 
	 Monthly EBITDA of 141,667 –
        166,666 USD 

	 	  
	  
	  
	 • 
	 16.67% of EBITDA between 141,667 and 166,666
        USD 

	 	  
	  
	  
	  
	 •        
        Bonus of 0 – 4,166.67 USD per month 

	 	  
	  
	 3. 
	 Monthly EBITDA of 166,667 –
        208,333 USD 

	 	  
	  
	  
	 • 
	 Total of 2 above plus 10% of EBITDA between
        166,667 – 208,333 USD 

	 	  
	  
	  
	  
	 •        
        Bonus of 4,167.67 USD plus 0 – 4,166.66 

	 	  
	  
	 4. 
	 Monthly EBITDA of 208,334 USD
        and above 

	 	  
	  
	  
	 • 
	 Total of 3 above plus 16% of EBITDA of 208,334
        or above 

	 	  
	  
	  
	  
	 •        
        Bonus of 8,334.33 plus 16% of EBITDA greater than 208,333 

	 	    
	  
	  
	  
	  

	   	 •   
	 The bonus will initially be
        capped at 180,000 USD annually and will be reviewed the earlier of a)
        regular salary reviews or b) when the cap is reached. 

      

	8. 	Vacation: 
	 	
       

		
      The COO will be entitled to a minimum of five (5) weeks
      of vacation per year subject to review annually. 

	 	
       

	9. 	
      Stock 

	 	
       

		
      The Company will grant 1 million shares of Banyan Stock
      (BANY on the Nasdaq OTCBB) upon signing this agreement at the then current
      market price. 

	10. 	
      Stock Options 

	 	
       
	
       

		
      The Company will grant 5 million stock options at the
      then current market price of Banyan common stock (BANY on the Nasdaq
      OTCBB) at time of acceptance of this offer of employment. These options
      shall vest as follows: 

		
      -
	
      1/3 upon commencement of employment 

		
      -
	
      1/3 upon the first anniversary of employment 

		
      -
	
      1.3 upon the second anniversary of employment 

		
      -
	
      100% upon Change of Control of the Company 

	 	
       
	
       

	11. 	
      Benefits: 

	 	
       
	
       

		
      No benefits are currently offered to employees of the
      Company. At such time as benefits do become available to employees of the
      Company, the COO will be entitled to such benefits commensurate with what
      is offered to employees of a similar level in the Company.
  

	12. 	Change of Control Provisions: 
	 	 
		
      If a change of control occurs with the Company then all
      options vest immediately. In addition, the change of control would trigger
      the severance provision herin if the COO does not elect to stay on under
      the new ownership, or if the new owners do not wish to continue employing
      the COO. 

	 	
       

	13. 	
      Severance: 

	 	
       

		
      If the Company terminates the employment of the COO
      without just cause, the COO will be entitled to 2 years of pay at the
      current salary at time of termination plus bonus based on the prior year
      bonus. 

	 	
       

	14. 	
      Entire Agreement: 

	 	
       

		
      This agreement constitutes the entire agreement between
      the Company and the COO. 

	 	
       

		
      Please signify your acceptance of the terms and
      conditions of your position by signing where noted and returning a copy to
      the undersigned prior to , , 2006. 

	 	
       

		
      Sincerely, 

	/s/ Cory Gelmon 	/s/ Michael Gelmon 
	Cory Gelmon 	Michael Gelmon 
	President and CFO 	Chief Executive Officer 
	Banyan Corporation 	Banyan Corporation 

Read, acknowledged and agreed to this 10th day of February,
2006 

/s/ Marshall WilmotFiled by Automated Filing Services Inc. (604) 609-0244 - U.S. Geothermal Inc. - Exhibit 10.9

GEOTHERMAL 
LEASE AND AGREEMENT 

This Lease and Agreement is made and entered into as of this
  ______ day of January, 2006, by and between: 

Philip Glover, Party of the first part, 
hereinafter
referred to as “Lessor” 

and 

US Geothermal Inc., an Idaho corporation, 
Party of
the second part, 
hereinafter referred to as “Lessee” 

who are referred to in the plural as the “Parties”. 

Recitals 

WHEREAS Lessor is the owner of certain land and
geothermal rights situated in Cassia County, in the State of Idaho, which the
Parties believe are suited for the development of Hot Water, Steam and Thermal
Energy for use as such and/or the conversion of such geothermal energy to the
production of electric power, or for any purpose other than the generation of
electric power, and

WHEREAS It is the desire of Lessor and Lessee to enter
into an agreement which will enable the development of said Hot Water, Steam and
Thermal Energy for any of the aforesaid purposes for the mutual profit of the
Parties, 

BE IT THEREFORE HEREBY AGREED AS FOLLOWS: 

1.       Purpose. For and in
consideration of the sum of Ten Dollars ($10.00) and other valuable
consideration set forth in clauses (4.) and (5.) below, receipt of which initial
sum and sufficiency of which is hereby acknowledged, and in consideration of the
covenants and agreements hereinafter contained, Lessor has granted, leased, let
and demised to Lessee, its grantees, successors and assigns, upon and subject to
the terms and conditions contained herein, the geothermal rights hereinafter
described, including but not limited to the sole and exclusive right to drill
for, produce, extract, take, remove and sell geothermal heat energy including ,
Hot Water, Steam, or Thermal Energy therefrom, and to store, utilize, process,
convert and otherwise treat such geothermal energy, during the term hereof. 

2.       Lands. The
geothermal rights which are the subject of this lease are situated in the county
and state above first named, consisting of approximately 160 acres and which is
described in Exhibit A attached hereto and incorporated as if more fully set
forth herein (hereinafter referred to as “Lands”).

1

3.       Term. This Lease
shall be for a term of ten (10) years from and after the date hereof
(hereinafter referred to as the “Primary Term”) and so long thereafter as Leased
Substances, or any of them, are derived or produced in commercial quantities
from the leased geothermal rights or any geothermal resource pooled, unitized or
combined therewith, and for so long as Lessee is prevented from producing same,
or the obligations of Lessee hereunder are suspended, for the causes hereinafter
set forth, or this Lease is continued in force by reason of any other provision
hereof. 

If at the expiration of the Primary Term, Lessee has not
completed one or more wells utilizing the leased geothermal rights or any
geothermal resource pooled, unitized or combined therewith, which well or wells
separately or collectively are either producing, or capable of producing, Hot
Water, Steam or Thermal Energy of Sufficient Power Potential in Commercial
quantities, but lessee is then engaged in operations for drilling, reworking,
recompleting, redrilling or enhancement of any well utilizing the leased
geothermal rights or any geothermal resource pooled, unitized or combined
therewith, this Lease shall remain in force so long as drilling, reworking,
recompleting, redrilling or enhancement operations are prosecuted (whether on
the same or different wells) utilizing the leased geothermal rights or any
geothermal resource pooled, unitized or combined therewith with no cessation of
such operations for more than six (6) months, and if such operations result in
production or the establishment to the satisfaction of the lessee of the
existence of Sufficient Power Potential in Commercial quantities, such well or
wells will be deemed to have been completed and such existence is established
during the primary term of this Lease. 

4.       Primary Term
Consideration. It is understood and agreed that the initial consideration paid,
TWO THOUSAND ONE HUNDRED DOLLARS ($2.100.00), upon the execution hereof, covers
both a signing bonus of $500.00, the rental in full hereunder for a period of
one (1) year from the date of this Lease and for all other rights conferred
hereunder. Thereafter, for the first five (5) years of the lease, on or before
said anniversary date, Lessee shall pay or tender to Lessor an annual rental in
the amount of ONE THOUSAND SIX HUNDRED DOLLARS ($1,600.00) , which shall
constitute rental until the next anniversary date hereof. For the second five
(5) year period of the lease, Lessee shall, on or before each succeeding
anniversary date during the primary term hereunder, pay or tender to Lessor an
annual rental in the amount of TWO THOUSAND FOUR HUNDRED DOLLARS ($2,400.00),
until such time as from the drilling of a well or wells utilizing the leased
geothermal rights or any geothermal resource pooled, unitized or combined
therewith, there has been established to the satisfaction of the Lessee the
existence of Sufficient Power Potential in Commercial quantities. Upon such
establishing as aforesaid, Lessee may nevertheless continue to pay or tender
annual rental payments on or before each anniversary date, until Lessee has
commenced the actual sale of one or more Leased Substances, and so long as such
annual rental payments to be paid or tendered, whether beyond the primary term
or not, this lease shall remain in force and effect. Rental payments made after
the primary term shall increase each year thereafter at the rate of 5% per year.
All payments so paid or tendered after the expiration of said primary term shall
be deemed advance royalties. So long as such payments are paid or tendered each
well or wells shall be deemed to be actually 

2

producing one or more Leased Substances in Commercial
quantities under the terms hereof; provided, however, that if within five (5)
years after the date of expiration of the primary term hereof Lessee shall have
failed to make, or make arrangements for (by executed contract or contracts) a
bona fide Commercial sale of one or more Leased Substances (or electric energy
generated therefrom) than Lessor, at its option, may consider Lessee in default
hereunder. Additionally, should lessee fail to make any annual payment herein
provided for on or before a particular anniversary date, Lessor may, at its
option, consider lessee in default hereunder. 

5.       Geothermal Royalties.
Royalties shall be payable as follows: 

           (a)      
With respect to Hot Water, Steam or Thermal Energy produced, saved and sold by
Lessee and then used by the purchaser for the generation of electric power,
Lessee shall pay to Lessor as a royalty Ten Percent (10%) of the market value of
such Hot Water, Steam or Thermal Energy produced utilizing the leased geothermal
rights at and as of the point of origin on the land which is subject to the
leased geothermal rights, which market value shall be deemed to be the gross
proceeds received by Lessee from such sale at the point of origin on the land
which is subject to the leased geothermal rights, unless the sale occurs at a
location other than such point of origin, in which case the market value shall
be deemed to be the gross proceeds received by Lessee from such sale less all
costs and expenses of extraction, production, storage, processing, reinjection,
and transportation between such point of origin and the actual point of sale.

           (b)       With
respect to Hot Water, Steam or Thermal Energy produced (collectively to be
referred to as “Energy Produced”), saved and used for the generation of electric
power which is then sold by Lessee, Lessee shall pay to Lessor as a royalty Ten
Percent (10%) of the Net Proceeds from the sale of Energy Produced utilizing the
leased geothermal rights, at and as of the point of origin on the land which is
subject to the leased geothermal rights in accordance with the definition of Net
Proceeds from the sale of Energy Produced as defined in paragraph 21,
subparagraph (g), unless the sale occurs at a location other than such point of
origin, in which case the Net Proceeds shall also take into account all costs
and expenses of storage and transportation between such point of origin and the
actual point of sale. 

           (c)      
With respect to Energy Produced, saved and sold by Lessee and which is used for
any purpose other than the generation of electric power, Lessee shall pay to
Lessor as a royalty Five Percent (5%) of the gross proceeds received by Lessee
from the sale of Energy Produced, as such, produced utilizing the leased
geothermal rights at and as of the point of origin on the land which is subject
to the leased geothermal rights, unless the sale occurs at a location other than
such point of origin, in which case the royalty shall be based on the gross
proceeds received by Lessee from such sale less all costs and expenses of
extraction, production, storage, processing, reinjection, and transportation
between such point of origin and the actual point of sale.

3

           (d)       With
respect to Extractable Minerals, Lessee shall pay as royalty to Lessor Five
Percent (5%) of the net proceeds received by Lessee from the sale of any gases
(as herein defined) and from the sale of effluence (containing minerals and/or
minerals in solution) produced and sold from any well or wells utilizing the
leased geothermal rights, or, in the event Lessee extracts from the effluence
minerals and/or minerals in solution, Five Percent (5%) of the proceeds received
by Lessee from the sale of minerals and/or minerals in solution contained in and
extracted from the effluence produced and sold from such well or wells less
costs of transportation and extraction. 

           Lessee
shall pay to Lessor on or before the twenty-fifth day of each month the
royalties accrued and payable for the preceding calendar month, or on or before
the twenty-fifth day of the month next following that in which Lessee receives
payment therefore from the purchaser thereof, whichever method may be chosen by
Lessee from time to time, and in making such royalty payments Lessee shall
deliver to Lessor statements setting forth the basis for computation and
determination of such royalty. 

           Lessee
shall not be required to account to Lessor for or to pay any royalty on Hot
Water, Steam, Thermal Energy produced by Lessee utilizing the leased geothermal
rights which is not utilized, saved and sold, or which is used by Lessee in its
operations for or in connection with the developing, recovering, producing,
extracting and/or processing of Hot Water, Steam, or Thermal Energy or in
facilities for the generation of electric power, or which are unavoidably lost.

           Lessee
shall have the right from time to time and at any time to commingle (for
purposes of storing, transporting, utilizing, selling and processing, or any of
them) the Leased Substances, or any of them, that are produced or extracted
utilizing the leased geothermal rights or any geothermal resource pooled,
unitized or combined therewith, with Geothermal Resources, or any of them,
produced from other lands or units in the vicinity of the land which is subject
to the leased geothermal rights, and in the event of such commingling, Lessee
shall meter, gauge, or measure the production occurring directly from
utilization of the leased geothermal rights, or from the unit or units,
including leased and other units or lands, as the case may be, and compute and
pay Lessor’s royalty payable under the provisions hereof on the basis of such
production so determined or allocated, as the case may be. 

From the time when Lessor shall commence Commercial production
utilizing the leased geothermal rights, Lessee shall then pay Lessor the
geothermal royalty set forth herein, or the initial term annual payments,
whichever shall be the larger. This change from annual lease payments to
geothermal royalty payments shall occur at the time when geothermal royalties
exceed annual lease payments in any given month. 

4

6.       Commingled and Unit
Operations. Lessee shall have the right to commingle, or unitize said leased
geothermal rights, for the purpose of utilizing, selling, processing, the Leased
Substances produced utilizing the leased geothermal rights with the steam or
heat energy produced from other lands or geothermal resources, and to meter or
gauge the production of steam or heat energy utilizing the leased geothermal
rights and to compute and pay Lessor royalty on the basis of such production as
so determined. Such unit shall be deemed created either upon Lessee recording in
the office of the county recorder in the county in which the land which is
subject to the leased geothermal rights is situated a written declaration of
such unit or upon Lessee giving written notice of such unit to Lessor. Any well
(whether or not Lessee’s well) commenced, drilled, drilling and/or producing or
being capable of producing in any part of such unit shall for all purposes of
this Lease be deemed a well commenced, drilled, drilling and/or producing
utilizing the leased geothermal rights, and Lessee shall have the same rights
and obligations with respect thereto and to drilling and producing operations
upon the lands from time to time included within any such unit as Lessee would
have if the geothermal resource within such lands constituted the leased
geothermal rights; provided, however, that notwithstanding this or any other
provision or provisions of this Lease to the contrary: 

           (a)      
production as to which royalty is payable from any such well or wells drilled
upon any such unit, whether located upon the land which is subject to the leased
geothermal rights or other lands, shall be allocated to the leased geothermal
rights in the proportion that the acreage of the leased geothermal rights in
such unit bears to the total acreage of geothermal rights of such unit, and such
allocated portion thereof shall for all purposes of this Lease be considered as
having been produced utilizing the leased geothermal rights and the royalty
payable under this Lease with respect to the leased geothermal rights included
in such unit shall be payable only upon that proportion of such production so
allocated thereto, and

           
(b)       if any taxes of any kind are levied or
assessed (other than taxes on the land and on Lessor’s improvements), any
portion of which is chargeable to Lessor under paragraph 15 hereof, then the
share of such taxes to be borne by Lessor as provided in the Lease, shall be in
proportion to the share of the production from such unit allocated to the leased
geothermal rights. 

Allocation of unit production whether to the leased geothermal
rights or to other lands or geothermal resources therein, shall continue after
any termination of all or any part of this or any other lease covering lands or
geothermal resources in the unit until any exploration, drilling, remedial
drilling or production operations are begun on the lands or geothermal resources
so terminated, or until contracts regarding any such operations are entered
into, whereupon all such terminated lands or geothermal resources shall be
excluded in the production to be allocated to the respective lands or geothermal
resources in such unit. In the event of the failure of Lessor’s, or any other
owner’s, title as to any portion of the land or geothermal resources included in
any such unit, such portion of such land or geothermal resources shall likewise
be excluded in allocating production from such unit, provided, however, Lessee
shall not be held to account for any production allocated to any lands or
geothermal resources excluded from any such operating unit 

5

unless and until Lessee has actual knowledge of the
circumstances requiring such exclusion. Any exclusion shall be deemed effective
the first day of the month next following the date upon which such exclusion
becomes finally established. 

           Lessee
may, at its sole option, at any time when there is no Commercial production in
such unit, terminate, enlarge or diminish such unit either by Lessee recording
in the office of the county recorder in the county in which the land which is
subject to the leased geothermal rights is situated a written declaration
thereof, or by Lessee giving written notice thereof to Lessor. 

In the event that the production of Leased Substances utilizing
the leased geothermal rights or from lands in the general area of the leased
geothermal rights should at any time exceed the demand for the facility use
thereof in the opinion of Lessee and the Lessee elects to reduce the total
amount of steam produced or consumed, then in that event each well participating
on a commingling basis shall be reduced in percentage amount equal to its
proportion of the whole.

7.       Use Of Lease. Lessee
shall have the right to drill such wells onto or under the land which is subject
to the leased geothermal rights as Lessee may deem desirable for the purposes
hereof including the exploration and production of Geothermal Resources for heat
or electric power production purposes and any reinjection of fluids thereof. No
well shall be drilled within 300 feet of any residence or 100 feet of any barn
now on such land without Lessor’s consent. 

8.       Exclusive Rights. Lessee
shall have exclusively the rights to all Leased Substances and to all power
production from Leased Substances on and/or from the land which is subject to
the leased geothermal rights during the term hereof, subject only to payment of
the royalties to Lessor as is set forth herein.

9.       Water. Lessee shall
not drill or operate water wells or take water in such a way as to pollute or
injure the water well of Lessor or interfere with or restrict the supply of
water to Lessor for domestic, livestock or agricultural use.

10.      Permits. Any wells
drilled by Lessee hereunder shall only be drilled after first obtaining any
relevant governmental agency permits regarding geothermal well drilling on the
leased land and in conformance with approved well design by relevant agencies.
Lessor agrees to cooperate with Lessee’s application for governmental licenses,
permits, and approvals, the cost of which shall be borne by Lessee.

11.      Partial Ownership
Interests. In the event Lessor at the time of making this Lease owns an interest
in the leased geothermal rights less than One Hundred Percent (100%) of the
right, title and interest purportedly granted or leased hereby to Lessee, then
any payments due Lessor hereunder shall be paid to Lessor only in the proportion
which Lessor’s Interest bears to a One Hundred Percent (100%) interest in the
leased geothermal rights. Notwithstanding the foregoing, should Lessor hereafter
acquire any additional right, title or interest in or to the leased geothermal
rights, it shall be subject to the provisions hereof to the same extent as if
owned by Lessor at the date hereof, and any increase in payments of money
hereunder necessitated thereby shall commence with the 

6

payment next following receipt by Lessee of satisfactory
evidence of Lessor’s acquisition of such additional interest 

12.      Assignment. There is
hereby expressly reserved to Lessor and to Lessee the right and privilege to
convey, transfer or assign, in whole or in part, or to deal with in any manner,
subject to the provisions hereof, their respective rights and interests in and
under this Lease and Agreement or in the leased geothermal rights, or the Leased
Substances produced utilizing the leased geothermal rights, but in the event
Lessor shall sell or transfer any part or parts of the leased geothermal rights
or any interest in the aforesaid Leased Substances therefrom, then Lessees
obligations hereunder shall not thereby be altered, increased or enlarged, but
Lessee may continue to utilize the leased geothermal rights and to pay and
settle rents and royalties as an entirety.

13.      Force Majeure. The
obligation of the Lessee hereunder shall be suspended and the terms of this
Lease shall be extended as the case may be, while Lessee is prevented from
complying therewith, in whole or in part, by strikes, lockouts, riots, war or
the results thereof, acts of God or the elements, fire, flood, accidents, delays
in transportation, inability to secure labor or material in the open market,
laws, orders, rules, or regulations of Federal, State, County, Municipal, or
other governmental agencies, authority, or representative, or any other matter
or condition beyond reasonable control of Lessee, whether or not similar to the
conditions or matters herein specifically enumerated, or while litigation
contesting Lessor’s title to the leased geothermal rights or the rights granted
Lessee hereunder or litigation involving Lessee’s operations hereunder shall be
pending and undetermined or during any period when Lessee has no market for the
products it is then capable of producing utilizing the leased geothermal rights
or the market price then available for such products will not produce an
acceptable profit. For so long as any of the above circumstances continue to
exist, Lessee, without impairment of its rights hereunder, shall be excused from
performance of all obligations hereunder except payment of taxes and protection
of the leased geothermal rights. It is expressly agreed that the prevention of
settlement of any litigation or strike or labor disturbance shall not be
considered a matter subject to Lessee’s control within the meaning of this
Paragraph.

14.      Tax Payments. Lessee
shall pay taxes levied and assessed against products of Lessee operations
hereunder and taxes levied and assessed against the right to produce steam and
heat energy utilizing the leased geothermal rights. Lessor shall pay all taxes
levied and assessed against the land, which is subject to the leased geothermal
rights not covered by this lease and/or Lessee tax payment requirements herein.

15.      Project Costs. All labor
to be performed and materials to be furnished in operations of Lessee hereunder
shall be at the cost and expense of Lessee, and Lessor shall not be chargeable
with, or liable for, any part thereof. Lessee shall protect the leased
geothermal rights against liens arising from its operations thereon. Upon
commencement of operations in relation to the leased geothermal rights, Lessee
shall protect Lessor against damages of every kind and character, which may be
occasioned to any of the parties hereto or to any other person by reason of the
operations or workings of the 

7

Lessee in relation to said leased geothermal rights. The
protection of Lessor shall include maintenance of workman’s compensation
insurance typical for geothermal drilling. 

16.      Default Notice. Upon
violation of any of the terms and conditions of this lease by Lessee and the
failure of Lessee to begin in good faith to remedy same within 30 days after
written notice from Lessor to do so, specifying in said notice the nature of
such default, then at the option of Lessor this lease shall forthwith cease and
terminate and all rights of Lessee in and to said leased geothermal rights shall
be at an end.

17.      Title. Lessor hereby
warrants and agrees to defend title to the leased geothermal rights and agrees
that Lessee, at its option, may pay and discharge any taxes, mortgages, trust
deeds or other liens or encumbrances existing, levied or assessed on or against
the leased geothermal rights, and in the event Lessee exercises such option,
Lessee shall be subrogated to the rights of any holder or holders thereof, and
shall have the right to reimburse itself by applying to the discharge of any
such mortgage, tax or other lien or encumbrance any royalties or rentals
accruing to Lessor hereunder.

18.      Notice. Any notice or
other communication hereunder from Lessor to Lessee shall be given in writing by
delivering same personally to Lessee or by sending same by registered or
certified mail postage prepaid or Federal Express to Lessee at 1509 Tyrell Lane,
Suite B, Boise, Idaho 83706. Any notice or other communication hereunder from
Lessee to Lessor shall be given in writing by delivering same personally to
Lessor or by sending same by registered or certified mail postage prepaid or
Federal Express to Lessor at the Lessor address set forth on the signature page
of this lease. Any notice so sent shall be deemed to have been given and
received within 96 hours of deposit thereof in the United States mail or within
48 hours of deposit thereof with Federal Express, providing that Lessor has
provided and street address and telephone number. The parties may upon written
notice to the other party, at any time and from time to time change their
respective addresses for the purposes hereof.

19.      Definitions. For the
purposes of this Lease the following definitions shall apply:

                  (a)       The
terms “Hot Water”, “Steam” and “Thermal Energy”, collectively referred to as
Energy Produced, each shall mean natural geothermal water and/or steam, and
shall also mean the natural heat of the earth and the energy present in,
resulting from or created by, or which may be extracted from, the natural heat
of the earth or the heat present below the surface of the earth, in whatever
form such heat or energy naturally occurs;

                  (b)      
The term “Leased Substances” shall collectively mean the matter, substances and
resources defined in subparagraph 21(a) that are subject to this Lease;

                  (c)      
The term “Geothermal Resources” shall collectively mean the matter, substances
and resources defined in subparagraph 21(a) that are not subject to this Lease
but are located on adjacent land or lands in reasonable proximity thereto;

8

                  (d)       The
term “Power Potential” shall mean, when used herein with respect to any well or
wells, the quantity, or units, of energy capable of being recovered from the Hot
Water, Steam or Thermal Energy produced therefrom by means of any energy
conversion or utilization facility (including, but not limited to, electrical
generating facilities) or equipment designed for use thereof;

                  (e)      
The term “Sufficient Power Potential” shall mean that Power Potential which, in
the sole judgment of Lessee shall be sufficient for the Commercial sale or
utilization thereof, or shall warrant the construction of facilities for the
Commercial sale or other utilization thereof, or shall justify additional
drilling or other operations utilizing the leased geothermal rights;

                  (f)      
The term “Commercial” shall mean those qualities of Leased Substances produced,
sold or used, the value of which, after determining Lessee’s direct operating
costs will be capable of providing a sufficient return to cause Lessee, in its
sole judgment, to continue production thereof or to elect to proceed with
further development or exploratory operations relating to the leased geothermal
rights. 

                  (g)      
The term “Net Proceeds” is defined as proceeds from the sale of generated
electric power to a third party, independent of the Lessor or Lessee, less
deductions of the sum of all direct operating costs, financing costs, interest
expense on capital, property taxes, franchise and other taxes, administration
and marketing expenses and the depreciation of production wells, reinjection
wells, monitoring wells, pipelines, all production facilities, power generation
facilities, electrical distribution equipment and power lines through to the
sales delivery point. Depreciation shall be on a fifteen (15) year straight-line
basis with asset capitalization in accordance with generally accepted accounting
principles. Electric power is computed and paid for on the basis of kilowatt-
hours (“Kw-h”) and the royalty shall be calculated on a basis of cents per
Kw-h.

                  (h)       The
term “Extractable Minerals” shall mean any minerals in solution in the well
effluence and all minerals and gases produced from or by means of any well or
wells on the land which is subject to the leased geothermal rights or by means
of condensing steam or processing water produced from the effluence from any
such well or wells. Said terms shall also include any water so produced or
obtained from condensation or steam; provided, however, that the term “gases”
shall not include hydrocarbon gases that can be produced separately from the
well effluents;

20.      Termination.
Notwithstanding any other provisions of this Lease, and in consideration of the
payment made by the Lessee to the Lessor for the execution of this Lease, Lessee
shall have the right at any time prior to or after default hereunder, to
quitclaim and surrender to Lessor all right, title and interest of Lessee in the
leased rights, and thereupon all rights and obligations of the parties hereto
one to the other shall cease and terminate, save and except as to any then
accrued royalty obligations of Lessee then payable as to which Lessee shall
remain liable to Lessor.

21.      Severability. In the
event that any part or portion or provision of this instrument shall be found or
declared to be null, void, or unenforceable for any reason whatsoever by 

9

any court of competent jurisdiction or any governmental agency
having authority thereover, then and in such event only such part, portion or
provision shall be affected thereby, and such finding, ruling or decision shall
not in any way affect the remainder of this instrument or any of the other terms
or conditions hereof, or any Lessor rights or obligations are not, or would not
be so held to be, void or unenforceable, which said remaining terms and
conditions and such Lessor rights or obligations, as aforesaid, of this
instrument shall remain binding, valid and subsisting and in full force and
effect between the parties hereto, it being specifically understood and agreed
that the provisions hereof, and the Lessor rights or obligations embraced within
such provisions, are severable for the purposes of the provisions of this
clause.

22.      Governing Law. This
lease and agreement shall be interpreted, governed by and construed under the
laws of the state of Idaho, without consideration of any conflicts of law
between the location of the parties or states of domicile thereof.

23.      Execution Authority. The
signatories hereto represent that they are the proper person to execute this
Lease and Agreement on behalf of the parties hereto.

24.      Binding Effect. This
Lease and Agreement and all of the terms, covenants and conditions hereof shall
extend to the benefit of and be binding upon the respective successors and
assigns of the parties hereto. 

IN WITNESS WHEREOF, the parties have caused this instrument to
be duly executed as of the date hereinabove first written. 

U. S. Geothermal Inc. 

 

	By:      Douglas J. Glaspey – Lessee
    	 	Philip
      Glover - Lessor 
	           
      Chief Operating Officer 	 	PO Box 121 
	    	 	Malta, ID 88342 

10

	State of ________________
	) 	On this ____________ day of _____________________________
      2005, before me, 
	  	) 	    
	County of ________________	) 	    

	      	     	the undersigned Notary Public, personally
      appeared Philip Glover

	  	 	(    ) personally known to me 
	  	 	(    ) proved to me on the basis
      of satisfactory evidence to be the person(s) whole name(s) Philip Glover
      subscribed to the within instrument, and acknowledged that they executed
      it. 
	  	 	  
	  	 	WITNESS my hand and official seal. 
	  	 	  
	  	 	  
	  	 	 
	  	 	Notary’s Signature 
	  	 	  
	  	 	  
	  	 	  
	State of Idaho 	)	On this ____________ day of _______________________
      2006, before me, 
	  	)	
	County of Ada 	)	
	    	   	the undersigned Notary Public, personally
      appeared Douglas J. Glaspey 

	  	 	(   ) personally known to me 
	        	       	(   ) proved to me on the basis
      of satisfactory evidence to be the person(s) whole name Douglas J. Glaspey
      subscribed to the within Instrument, and acknowledged that he executed it.
    

	  	 	  
	  	 	WITNESS my hand and official seal. 
	  	 	  
	  	 	  
	  	 	  
	  	 	Notary’s Signature 

11

Exhibit A 

160.0 acres more or less 

100% Geothermal:

Township 15 South, Range 26 East

Section 25:          SW 1/4

Excepting oil and gas rights to the property 

12

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