Document:

ex.402.htm

Exhibit 4.02

Void after _________

Warrant No.

 

THIS WARRANT AND ANY SHARES ACQUIRED UPON THE EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.  THIS WARRANT AND SUCH SHARES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER SAID ACT.  THIS WARRANT AND SUCH SHARES MAY NOT BE TRANSFERRED EXCEPT UPON THE CONDITIONS SPECIFIED IN THIS WARRANT, AND NO TRANSFER OF THIS WARRANT OR SUCH SHARES SHALL BE VALID OR EFFECTIVE UNLESS AND UNTIL SUCH CONDITIONS SHALL HAVE BEEN COMPLIED WITH.

 

FORCEFIELD ENERGY INC.

 

COMMON STOCK PURCHASE WARRANT

 

ForceField Energy Inc., a Nevada corporation (the “Company”), having its principal office at 245 Park Avenue, 39th Floor, New York, New York, USA, 10167, hereby certifies that, for value received, ____________, or assigns, is entitled, subject to the terms set forth below, to purchase from the Company at any time on or from time to time after the Commencement Date (as defined below) and before 5:00 P.M., PST, on___________, or as extended in accordance with the terms hereof (the “Expiration Date”), _________ fully paid and non-assessable shares of Common Stock of the Company, at the initial purchase price per share (as defined below) of $____ (“Purchase Price”).

 

Background.  This warrant is issued to investor in a private placement pursuant to a subscription agreement (the “Subscription Agreement”) between the Company and the investors party thereto (the “Offering”), as part of a Company private placement in which the Company agreed to issue warrants to purchase an aggregate of up to 1,000,000 shares of Common Stock (subject to adjustment as provided herein) (collectively the “Warrants”).

 

Capitalized terms have the meaning as defined in the Subscription Agreement, or if not defined therein, have the following respective meanings:

“Holder” means any record owner of Warrants or the Warrant Shares.

 

“Market Price” at any date shall be deemed to be (i) if the principal trading market for such securities is a Nasdaq market or another exchange, the average of the high reported sale prices per share of Common Stock for the five preceding consecutive trading days on which the Common Stock trades ending on the date immediately before the date of determination, (ii) if the principal market for the Common Stock is the over-the-counter market, the average of the high reported sale prices per share on such trading days as set forth by such market, (iii) if there is no high reported sale prices per share on such trading days for the Common Stock on such over-the-counter market, the average of the mean of the bid and asking prices per share on such trading days as set forth in the National Quotation Bureau sheet listing such securities for such days, or (iv) if there is no reported high bid and asked prices, as the case may be, reported on any of the five trading days preceding the event requiring a determination of Market Price hereunder, then the Market Price shall be determined in good faith by resolution of the Board of Directors of the Company, based on the best information available to it.

“Original Issue Date” means _________.

  

“Securities Act” means the Securities Act of 1933 as the same shall be in effect at the time.

 

  

  

  

1.           Sale or Exercise.  If, at the time of any exercise, transfer or surrender for exchange of a Warrant or Warrant Shares previously issued upon the exercise of Warrants, and such Warrant or Warrant Shares has not been registered under the Securities Act, the Company may require, as a condition of allowing such exercise, transfer or exchange, that the Holder or transferee of such Warrant or Warrant Shares, as the case may be, furnish to the Company an opinion of counsel, reasonably satisfactory to the Company, to the effect that such exercise, transfer or exchange may be made without registration under the Securities Act, provided that the disposition thereof shall at all times be within the control of such Holder or transferee, as the case may be, and provided further that nothing contained in this Section 1 shall relieve the Company from complying with its obligations concerning registration of Warrant Shares pursuant to the Subscription Agreement.

2.           Exercise of Warrant.

 

2.1           Exercise in Full.  Subject to the provisions hereof, this Warrant may be exercised in full by the Holder hereof by surrender of this Warrant, with the form of subscription at the end hereof duly executed by such Holder, to the Company at its principal office accompanied by payment, in cash, bank wire or by certified or official bank check payable to the order of the Company, in the amount obtained by multiplying the number of shares of Common Stock issuable upon exercise of this Warrant by the Purchase Price per share, after giving effect to all adjustments through the date of exercise.

 

2.2           Partial Exercise.  Subject to the provisions hereof, this Warrant may be exercised in part by surrender of this Warrant in the manner and at the place provided in Section 2.1 except that the amount payable by the Holder upon any partial exercise shall be the amount obtained by multiplying (a) the number of shares of Common Stock (without giving effect to any adjustment therein) designated by the Holder in the subscription at the end hereof by (b) the Purchase Price per share.  Upon any such partial exercise, the Company at its expense will forthwith issue and deliver to or upon the order of the Holder hereof a new Warrant or Warrants of like tenor, in the name of the Holder hereof or as such Holder (upon payment by such Holder of any applicable transfer taxes) may request, calling in the aggregate on the face or faces thereof for the number of shares of Common Stock equal (without giving effect to any adjustment therein) to the number of such shares called for on the face of this Warrant minus the number of such shares designated by the Holder in the subscription at the end hereof.

 

2.3           Company to Reaffirm Obligations.  The Company will, at the time of any exercise of this Warrant, upon the request of the Holder hereof, acknowledge in writing its continuing obligation to afford to such Holder any rights (including, without limitation, any right to registration of the Warrant Shares) to which such Holder shall continue to be entitled after such exercise in accordance with the provisions of this Warrant, provided that if the Holder of this Warrant shall fail to make any such request, such failure shall not affect the continuing obligation of the Company to afford such Holder any such rights.

 

2.4           Certain Exercises.  If an exercise of a Warrant or Warrants is to be made in connection with a registered public offering or sale of the Company, such exercise may, at the election of the Holder, be conditioned on the consummation of the public offering or sale of the Company, in which case such exercise shall not be deemed effective until the consummation of such transaction.

 

3.           Delivery of Stock Certificates, etc., on Exercise.  As soon as practicable after the exercise of this Warrant in full or in part, and in any event within ten business days after delivery or surrender of all documents and instruments required to be delivered or surrendered to the Company for such exercise, including payment of the exercise price in cash in accordance with this Warrant, the Company at its own expense (including the payment by it of any applicable issue taxes) will cause to be issued in the name of and delivered to the Holder hereof, or as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct, a certificate or certificates for the number of fully paid and non-assessable shares of Common Stock to which such Holder shall be entitled upon such exercise, plus, in lieu of any fractional share to which such Holder would otherwise be entitled, cash equal to such fraction multiplied by the then current Market Price of one full share, together with any other stock or other securities and property (including cash, where applicable) to which such Holder is entitled upon such exercise pursuant to Section 4 or otherwise.

 

  

  

  

 

4.           Dividends; Reclassifications, Exchange or Substitution; Combinations

(a)           If the Company declares or pays a dividend on its Common Stock payable in Common Stock, or other securities, subdivides the outstanding Common Stock into a greater or lesser amount, as applicable, of Common Stock, then upon exercise of this Warrant, for each Warrant Share acquired, Holder shall receive, without cost to Holder, the total number and kind of securities to which Holder would have been entitled had Holder owned the Warrant Shares of record as of the date the dividend or subdivision occurred.

(b)           Upon any reclassification, exchange, substitution, or other event that results in a change of the number and/or class of the securities issuable upon exercise or conversion of this Warrant, Holder shall be entitled to receive, upon exercise or conversion of this Warrant, the number and kind of securities and property that Holder would have received for the Warrant Shares if this Warrant had been exercised immediately before such reclassification, exchange, substitution, or other event.  The Company or its successor shall promptly issue to Holder a new Warrant for such new securities or other property. The new Warrant shall provide for adjustments that shall be as nearly equivalent as may be practicable to the adjustments provided for in this Section 4. The provisions of this Section 4(b) shall similarly apply to successive reclassifications, exchanges, substitutions, or other events.

(c)           If the outstanding Warrant Shares are combined or consolidated, by reclassification or otherwise, into a lesser number of shares, the Purchase Price shall be proportionately increased. 

 

5.           Further Assurances.  The Company will take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and non-assessable shares of stock upon the exercise of all Warrants from time to time outstanding.

  

6.           Reservation of Stock, etc., Issuable on Exercise of Warrants.  The Company will at all times reserve and keep available, solely for issuance and delivery upon the exercise of the Warrants, all shares of Common Stock from time to time issuable upon the exercise of the Warrants.

  

7.           Exchange of Warrants.  Subject to the provisions of Section 1 hereof, upon surrender for exchange of any Warrant, properly endorsed, to the Company, as soon as practicable, the Company at its own expense will issue and deliver to or upon the order of the Holder thereof a new Warrant or Warrants of like tenor, in the name of such Holder or as such Holder (upon payment by such Holder of any applicable transfer taxes) may direct, calling in the aggregate on the face or faces thereof for the number of shares of Common Stock called for on the face or faces of the Warrant or Warrants so surrendered.

 

8.           Replacement of Warrants.  Upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of any Warrant and, in the case of any such loss, theft or destruction, upon delivery of an indemnity agreement reasonably satisfactory in form and amount to the Company or, in the case of any such mutilation, upon surrender and cancellation of such Warrant, the Company at its expense will execute and deliver, in lieu thereof, a new Warrant of like tenor.

  

  

  

 

9.           Negotiability, etc.  Subject to Section 1 above, this Warrant is issued upon the following terms, to all of which each Holder or owner hereof by the taking hereof consents and agrees:

 

(a)           subject to the provisions hereof, title to this Warrant may be transferred by endorsement (by the Holder hereof executing the form of assignment at the end hereof) and delivery in the same manner as in the case of a negotiable instrument transferable by endorsement and delivery;

 

(b)           subject to the foregoing, any person in possession of this Warrant properly endorsed is authorized to represent himself as absolute owner hereof and is empowered to transfer absolute title hereto by endorsement and delivery hereof to a bona fide purchaser hereof for value; each prior taker or owner waives and renounces all of his equities or rights in this Warrant in favor of each such bona fide purchaser and each such bona fide purchaser shall acquire absolute title hereto and to all rights represented hereby; and

 

(c)           until this Warrant is transferred on the books of the Company, the Company may treat the registered Holder hereof as the absolute owner hereof for all purposes, notwithstanding any notice to the contrary.

 

10.           Notices, etc.  All notices and other communications from the Company to the Holder of this Warrant shall be mailed by first class registered or certified mail, postage prepaid, at such address as may have been furnished to the Company in writing by such Holder, or, until an address is so furnished, to and at the address of the last Holder of this Warrant who has so furnished an address to the Company.

 

11.           Miscellaneous.  This Warrant and any term hereof may be changed, waived, discharged or terminated only by an instrument in writing signed by the Company and the Holders of outstanding Warrants to purchase a majority of the shares of Common Stock underlying all the outstanding Warrants.  This Warrant is being delivered in the State of Nevada and shall be construed and enforced in accordance with and governed by the laws of such State.  The headings in this Warrant are for purposes of reference only, and shall not limit or otherwise affect any of the terms hereof.  Subject to Section 1 hereof, this Warrant is fully assignable at any time. 

 

12.           Amendments.  This Warrant may not be amended, modified or terminated, and no rights or provisions may be waived, except with (a) the written consent of the Holder and the Company or (b) in the event that all Warrants issued under the Subscription Agreement are to be amended in like fashion, a majority in interest of the holders of all such Warrants and the Company.

Dated: _________________, 2015

 

FORCEFIELD ENERGY INC.

 

By:________________________________

Name:

Title:

 

 

  

  

  

 

FORM OF SUBSCRIPTION

 

(To be signed only upon exercise of Warrant)

 

To: FORCEFIELD ENERGY INC.

 

The undersigned, the Holder of the within Warrant, hereby irrevocably elects to exercise the purchase right represented by such Warrant for, and to purchase thereunder, shares of Common Stock of FORCEFIELD ENERGY INC., and herewith makes payment therefor:

 

of $____________

 

and requests that the certificates for such shares be issued in the name of, and delivered to, ___________________, whose address is _______________________.

 

The undersigned represents that the undersigned is acquiring such securities for its own account for investment and not with a view to or for sale in connection with any distribution thereof (except for any resale pursuant to, and in accordance with a valid registration statement effective under the Securities Act of 1933).

 

Dated: __________________

__________________________________________

(Signature must conform in all respects to name of Holder as specified on the face of the Warrant)

 __________________________________________

(Address)

 

	
 

____________

	
Insert here the number of shares called for on the face of the Warrant (or, in the case of a partial exercise, the portion thereof as to which the Warrant is being exercised).

 

  

  

  

  

FORM OF ASSIGNMENT

 

(To be signed only upon transfer of Warrant)

 

For value received, the undersigned hereby sells, assigns and transfers unto _________________________ the right represented by the within Warrant to purchase _________ of Common Stock of ForceField Energy Inc. to which the within Warrant relates, and appoints ______________________________ Attorney to transfer such right on the books of ForceField Energy Inc. with full power of substitution in the premises.  

 

Dated:_______________

 

__________________________________________

(Signature must conform in all respects to name of Holder as specified on the face of the Warrant)

__________________________________________

(Address)

 

Signature guaranteed by a Bank

or Trust CompanyExhibit 10(e)

 

MODIFICATION OF LEASE

 

THIS MODIFICATION OF LEASE made this 23rd day of January, 1946, by and between CLOQUET LUMBER COMPANY, a corporation of the State of Iowa and qualified to hold property in the State of Minnesota, hereinafter called the “Lessor”, Party of the First Part, and RESERVE MINING COMPANY, a corporation of the State of Minnesota, hereinafter called “Lessee”, Party of the Second Part;

 

W  I  T  N  E  S  S  E  T  H  THAT:

 

WHEREAS, on May 1, 1916, an Indenture of Lease was entered into by and between Lessor and Claude W. Peters, as Lessee, which lease was recorded in Book 690 of Deeds, Page 529 in the Office of the Register of Deeds of St. Louis County, Minnesota; and

 

WHEREAS, Claude W. Peters, named as Lessee in said lease, assigned all of his right, title and interest in and to said lease and the leasehold estate created thereby to Mesabi Iron Company, a corporation of the State of Delaware, by assignment of lease dated December 19, 1919, and recorded in Book 690 of Deeds, Page 545 in the Office of the Register of Deeds of St. Louis County, Minnesota; and

 

WHEREAS, said Mesabi Iron Company assigned all of its right, title and interest in and to said lease and the leasehold estate created thereby to said Reserve Mining Company, Lessee herein, by assignment of lease dated July 25, 1939, and recorded in Book 690 of Deeds, Page 565 in the Office of the Register of Deeds of St. Louis County, Minnesota, and said Reserve Mining Company is now the Lessee under said lease; and

 

WHEREAS, the Lessor and Lessee herein mutually desire to modify and amend certain of the terms and provisions of said lease in the manner and to the extent hereinafter set forth;

 

 

NOW, THEREFORE, in consideration of the premises and the sum of One Dollar ($1.00) by the Lessee to the Lessor in hand paid and other valuable considerations between the parties moving, the receipt and sufficiency whereof are hereby acknowledged, the parties hereto do hereby covenant and agree as follows:

 

1.                                      That Article FIRST of said lease be and the same hereby is modified and amended to read as follows:

 

FIRST:  The Lessor does hereby let, lease and demise unto the Lessee all the following described tracts and parcels of land, situate, lying and being in the County of St. Louis and State of Minnesota, and more particularly described as follows, to wit:

 

The Northwest Quarter of the Northeast Quarter (NW1⁄4 of NE1⁄4) and the North Half of the Northwest Quarter (N1⁄2 of NW1⁄4) of Section Five (5); the West Half of the Northeast Quarter (W1⁄2 of NE1⁄4) and the Northwest Quarter (NW1⁄4) and the Southwest Quarter (SW1⁄4) of Section Six (6); the North Half of the Northeast Quarter (N1⁄2 of NE1⁄4), the Southwest Quarter of the Northeast Quarter (SW1⁄4 of NE1⁄4) and the Northwest Quarter of the Southwest Quarter (NW1⁄4 of SW1⁄4) of Section Seven (7); all in Township Fifty-nine (59) North, Range Thirteen (13) West; and the Northwest Quarter of the Northwest Quarter (NW1⁄4 of NW1⁄4) of Section Thirty-one (31) in Township Sixty (60) North, Range Thirteen (13) West;

 

for the term commencing May 1, 1916, and continuing until all of the iron ore, taconite and other minerals or materials in, under, or upon the above described lands shall have been exhausted.

 

2.                                      That Article SECOND of said lease be and the same hereby is modified and amended to read as follows:

 

SECOND:  The said lands are hereby leased to the Lessee for the purpose of exploring for, mining, removing, treating, shipping and selling the iron ore, taconite and any other iron bearing material, and any and all other minerals that may be found therein or thereon, with the right to use or remove the surface of said demised premises for any and all purposes deemed necessary by Lessee for mining purposes, including the right to construct roads and highways thereon, and of erecting and maintaining on said lands all such buildings, dwellings, stores, employees’ and workmen’s houses, mills and plants, machinery, excavations, openings,

 

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ditches, drains, flumes, pipe lines, railways, tramways, water-ways, power and transmission lines, and all such other improvements and fixtures as may be deemed necessary or convenient by Lessee for such mining purposes.  It is expressly agreed and understood, anything herein contained to the contrary notwithstanding, that Lessee shall not have the right hereunder to use, and that Lessee will not use, said lands for agricultural purposes.  The Lessee shall have the right to use such of the water on said demised premises as may be necessary to mining purposes, insofar as the Lessor has authority to grant the same.  The Lessor shall have the right to enter upon said premises, and to cut and remove therefrom any valuable timber standing thereon, but such entering and removing shall in no way interfere with the operations of the Lessee.  In the event of the erection of any buildings on said demised premises, the use and occupancy thereof shall cease and determine upon the termination of this lease, whether by the acts of the parties, or either of them, or by the expiration of the term hereof; and all such buildings shall be removed from the demised premises within the time mentioned in Article TENTH hereof, and upon the failure to so remove them, title thereto shall vest in the Lessor.  The Lessee covenants to preserve all the demised lands from adverse occupancy or possession on the part of any person, and to preserve the same from being lost for non-payment of taxes, mechanic’s liens, or otherwise.

 

3.                                      That Article FIFTH of said lease be and the same hereby is modified and amended to read as follows:

 

FIFTH:  The parties hereto believe that the greater portion of the mineral bearing rock now known to exist on, in, or under the demised lands, is so largely composed of silicious and other substances as to require the concentration thereof by crushing, grinding and magnetic treatment, or other processes, before shipment, and the binding of the resulting concentrates, so as to secure a product which will be merchantable and of proper composition for successful and economical use in a blast furnace.

 

For the purposes of this lease —

 

(a)                                 The words “crude ore” wherever used herein shall mean iron ore bearing material as the same is delivered at the primary crusher for milling and beneficiation.

 

(b)                                 Any process whereby the percentage of iron content of the crude ore is increased by the elimination of silica and other foreign substances, whether by crushing, grinding, separation and/or any other process, and if necessary, the agglomeration of the concentrates, whether by nodulization or sintering or any other process so as to secure a product

 

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which will be merchantable and of proper composition for successful and economical use in a blast furnace is hereinafter referred to as “beneficiation” or “beneficiated”, as the context requires, and the plant or mill in which such processes are carried on is hereinafter referred to as “beneficiation plant”.

 

(c)                                  The words “concentrated ore” wherever used herein shall mean crude ore which has been beneficiated and is ready for shipment to the blast furnace.

 

It is therefore agreed that Lessee shall have the right to improve the crude ore by beneficiation on the demised premises, or Lessee may remove the same from the demised premises to such other place or places as Lessee may deem best for the purpose of beneficiating the same.  The waste material resulting from such beneficiation may, at the option of the Lessee, be deposited on the demised premises, but in such manner and in such place or places as will not conflict with or hinder the future operation of any mine or mines thereon, or the Lessee may sell such waste material, in which event Lessee shall pay to Lessor Fifteen per cent (15%) of the net profits arising from any such sale after deducting all loading, transportation, selling or other charges in connection therewith; the same to be paid quarterly on the quarter days in this lease mentioned, or the Lessee may dispose of or completely waste all of such tailings or other waste material in any manner Lessee considers advisable.

 

Lessee further agrees to conduct such beneficiation of the crude ore in a good and workmanlike manner and in accordance with the requirements of good engineering practice and sound business principles in order to render the product of such beneficiation merchantable and of proper composition and character for successful and economical furnace use, and Lessee will use in such beneficiation proper machinery and appliances to accomplish that end.  In this connection it is understood that a certain loss or waste will of necessity result from any such beneficiation and it is further agreed that Lessee may use its best judgment in the method of beneficiating the crude ore and may from time to time modify the process and the degree of recovery of the mineral value to meet changed business and market conditions.

 

Lessee hereby agrees that all of the crude ore mined hereunder from said demised premises which Lessee deems desirable to beneficiate may be beneficiated, but Lessee shall be under no obligation to either mine or to beneficiate any crude ore containing less than Twenty-one per cent (21%) magnetic iron in natural condition.

 

If the beneficiating plant in which crude ore from the demised premises is beneficiated is located on any lands other than the demised premises, then the Lessee shall, before any crude ore is removed from the

 

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demised premises to any such beneficiating plant, notify the Lessor in writing of the description of the lands upon which any such plant is located and the lands upon which the concentrated ore shall be stockpiled, and thereupon and thenceforth such premises shall be deemed to be the same as the demised premises as to all rights of Lessor under this lease to the concentrated ore stockpiled thereon; the intention hereof being to grant to Lessee the right at its election to have the beneficiating of the crude ore carried out upon lands other than the demised premises but without waiving any right which Lessor would have in and to the concentrated ore if the beneficiation thereof were conducted upon the demised premises.

 

Lessee shall have the right to mix crude ore mined from the demised premises with crude ore mined from other lands before such crude ore is beneficiated, as aforesaid, provided Lessee shall take representative samples and make detailed analyses thereof to determine as accurately as possible the content of the crude ore mined from the demised premises and from the other lands comprising the mixture and the recoverable iron through beneficiation of such crude ores, and shall keep accurate record of such analyses and of the recoverable iron content and of the weight of the crude ore removed from the demised premises and of the crude ore removed from other lands which comprise the mixture; such weights to be determined on proper scales installed and maintained by Lessee.  From said analyses and from said percentage of recovery of iron and said weights Lessee shall determine and keep a proper record of the percentage of concentrated ore resulting from the treatment of the crude ore mined from the demised premises and the percentage of the concentrated ore resulting from the treatment of the crude ore mined from the other lands.  Lessee shall permit authorized representatives of Lessor to examine said records at all reasonable times and to be present when said analyses and tests are made.

 

It is agreed that any crude ore removed from the demised premises to any other lands for the purpose of beneficiating the same shall not be deemed to be shipped from the demised premises so as to cause the royalty herein provided for to accrue thereon until such concentrated ore shall actually be shipped.  If a plant for the beneficiation of the crude ore is erected upon the demised premises Lessor hereby grants to Lessee the right and privilege to transport crude ore from other lands to the demised premises and to beneficiate thereon such crude ores and to deposit on the demised premises all the waste materials and concentrated ores resulting from such beneficiation in such manner and in such place or places as will not conflict with or hinder the future operation of any mine or mines thereon.

 

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4.                                      That Article SEVENTH of said lease be and the same hereby is modified and amended to read as follows:

 

SEVENTH:  Lessee covenants and agrees to and with the Lessor that Lessee will on the Thirtieth (30th) days of January, April, July and October in each year (herein called “quarter days”), or on the day ensuing if that day falls on Sunday or a legal holiday, during the period hereinbefore stipulated, or during the period this lease continues in force, pay to, or for the use of, the Lessor, at such bank in the State of Minnesota, or elsewhere in the United States as the Lessor may from time to time in writing designate, a royalty for all iron ore mined, removed and shipped from said premises during the three calendar months next preceding the first day of the month in which payment is to be made, as aforesaid, as follows, to wit:

 

(1)                                 For all ore mined and shipped in its natural condition as the same is taken from the mine, as provided in Article SIXTH hereof, Forty Cents (40¢) per ton of Twenty-two Hundred and Forty (2240) pounds.

 

(2)                                 For each ton of concentrated ore as defined in Article FIFTH hereof averaging in iron Forty per cent (40%) or less, dried at 212° F., Eleven Cents (11¢); for each ton of concentrated ore averaging Forty-one per cent (41%) iron, dried at 212° F., Eleven and Eleven One-hundredths Cents (11.11¢); for each ton of concentrated ore averaging Forty-two per cent (42%) iron, dried at 212° F., Eleven and Twenty-two One-hundredths Cents (11.22¢), and so on adding Eleven One-hundredths Cents (.11¢) per ton to the amount of royalty for each One per cent (1%) increase in iron of the concentrated ore above Forty per cent (40%) dried at 212° F., so that if the concentrated ore when shipped averaged 62.50% iron dried at 212° F., the royalty would be Thirteen and Four Hundred Seventy-five One-thousandths Cents (13.475¢) per ton; or, at the option of the Lessee, for each ton of crude ore, as defined in Article FIFTH, an amount computed by dividing the royalty rate determined as above on the concentrated ore from which the crude ore is produced by the number of tons of crude ore required to be beneficiated to product one ton of concentrated ore, that is, if it requires the beneficiation of three tons of crude ore to produce one ton of concentrated ore, then the royalty per ton for crude ore would be one-third of the royalty per ton for the concentrated ore.  The word “ton” when used herein means a gross ton of Twenty-two Hundred and Forty (2240) pounds.

 

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(3)                                 If Lessee elects to treat any of the concentrated ore from the demised premises by metallizing the same before the sale thereof, then, and in such event, royalty shall be paid as aforesaid on either the concentrated ore or the crude ore used in such process and the delivery of any concentrated ore to any plant for metallization shall be deemed the equivalent of shipment of such ore from the premises and the royalty shall become payable thereon as in this Article SEVENTH provided.  Such concentrated ores before being treated by metallizing shall be weighed, sampled and analyzed to determine the iron content thereof, and if shipped by rail such concentrated ores shall be weighed by the railroad company transporting the same.  If such concentrated ores are not shipped by rail to the plant for metallizing, then such concentrated ores shall be weighed on proper scales to be installed and maintained by the Lessee, subject to like inspection and correction of errors as in the case of the railroad company’s scales and weights.  The sampling and analyzing of the concentrated ore being treated by metallizing shall in all cases be done by a competent chemist and in a manner usual and customary in sampling and analyzing iron ores and at the expense of the Lessee.  Lessee shall give Lessor thirty (30) days’ notice of Lessee’s intention to metallize.

 

Lessee, at the time of such royalty payment, shall transmit to the Lessor an exact and truthful statement of the amount of iron ore shipped or removed during the three calendar months for which such payment shall be made, showing the iron ore shipped in its natural condition without treatment, the tonnage of crude ore mined and the tonnage of the concentrated ore.  Except as herein otherwise provided, the iron ore so mined and shipped from said land, and the concentrated ore, shall be weighed by the railroad company transporting the same, which weights shall be prima facie evidence between the parties hereto, or shall be weighed on proper scales installed and maintained by Lessee, subject to like inspection and correction of errors as in the case of the railroad company’s scales and weights.

 

Lessee also agrees to furnish to Lessor monthly statements showing all the aforesaid weights, but the Lessor reserves the right to inspect, review and test the correctness of the railroad company’s scales and weights, and the scales and weights herein provided for, at any time and in such manner as Lessor may see fit to adopt; it being understood that any errors in these respects, when ascertained, shall be recognized and corrected in the accounts.

 

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5.                                      That Article EIGHTH of said lease be and the same hereby is modified and amended to read as follows:

 

EIGHTH:  Lessee further covenants and agrees that from and after May 1, 1946, Lessee shall pay as minimum royalty hereunder One Thousand Dollars ($1,000.00) a year for a period of Ten (10) years, or until May 1 of the year following the calendar year in which Lessee commences mining operations under that certain lease Lessee now holds made October 1, 1917, as of April 30, 1915, by and between East Mesaba Iron Company and Dunka River Iron Company, as Lessors, and Claude W. Peters, as Lessee, and recorded in Book 690 of Deeds, Page 411 in the Office of the Register of Deeds of St. Louis County, Minnesota, whichever event first occurs, and then at the rate of Two Thousand Dollars ($2,000.00) a year for the next Ten (10) year period, and thereafter at the rate of Five Thousand Dollars ($5,000.00) a year until this lease shall expire or be terminated in the manner herein provided.  Such minimum royalty shall be paid in each year in four (4) equal installments on the quarter days above mentioned for the payment of royalties on ore mined and shipped.

 

All moneys paid as minimum royalties in excess of the royalties which accrue on ores actually shipped during any quarter shall be considered advanced royalties, and whenever the royalties accruing on ores actually shipped in any subsequent quarter exceed the minimum amount payable in such quarter, then the Lessee shall be entitled to be credited by a sum equal to such excess royalties payable in such subsequent quarter, until Lessee has been credited with all moneys paid by Lessee as advanced royalties.

 

6.                                      Said lease dated May 1, 1916, as herein modified and amended shall continue in full force and effect.

 

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IN WITNESS WHEREOF, Cloquet Lumber Company and Reserve Mining Company have caused these presents to be signed by their respective proper officers and their respective corporate seals to be hereunto affixed as of the day and year first above written.

 

	
Signed,   sealed and delivered
    	
 
    	
 
    
	
in   the Presence of:
    	
 
    	
CLOQUET   LUMBER COMPANY
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By
    	
 
    
	
 
    	
 
    	
 
    	
Vice President
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Attest:
    	
 
    
	
 
    	
 
    	
 
    	
Secretary
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
RESERVE   MINING COMPANY
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By
    	
 
    
	
 
    	
 
    	
 
    	
President
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Attest:
    	
 
    
	
 
    	
 
    	
 
    	
Secretary
    
					

 

9

 

	
STATE   OF
    	
 
    	
:
    	
 
    	
 
    
	
COUNTY   OF
    	
 
    	
:
    	
 
    	
SS:
    

 

On this          day of January, 1946, before me, a Notary Public within and for said County and State, personally appeared                                                           , to me personally known, who being by me first duly sworn, did say that he is the Vice President of Cloquet Lumber Company; that the seal affixed to the foregoing instrument is the corporate seal of said corporation and that said instrument was signed and sealed on behalf of said corporation by authority of its Board of Directors and said                                                acknowledged said instrument to be the free act and deed of said corporation.

 

	
My   Commission Expires:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Notary Public
    

 

	
STATE OF OHIO
    	
:
    	
 
    	
 
    
	
COUNTY OF CUYAHOGA
    	
:
    	
 
    	
SS:
    

 

On this          day of January, 1946, before me, a Notary Public within and for said County and State, personally appeared                                                           , to me personally known, who being by me first duly sworn, did say that he is the                   President of Cloquet Lumber Company; that the seal affixed to the foregoing instrument is the corporate seal of said corporation and that said instrument was signed and sealed on behalf of said corporation by authority of its Board of Directors and said                                                acknowledged said instrument to be the free act and deed of said corporation.

 

	
My   Commission Expires:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Notary Public
    

 

10

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00243-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00243-of-00352.parquet"}]]