-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, f5IdWFvGCjw6ZTHZuxkfulZeQMnFvrKEVeVuqQhDglw6MPkNqG7usC9DqAN0MkUa IyR0BFEniuuFhf9OTD28AA== 0000950134-95-001219.txt : 19950530 0000950134-95-001219.hdr.sgml : 19950530 ACCESSION NUMBER: 0000950134-95-001219 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 19950331 FILED AS OF DATE: 19950519 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: URANIUM RESOURCES INC /DE/ CENTRAL INDEX KEY: 0000839470 STANDARD INDUSTRIAL CLASSIFICATION: MISCELLANEOUS METAL ORES [1090] IRS NUMBER: 752212772 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-17171 FILM NUMBER: 95541214 BUSINESS ADDRESS: STREET 1: 12750 MERIT DRIVE STREET 2: SUITE 1210 CITY: DALLAS STATE: TX ZIP: 75251 BUSINESS PHONE: 2143877777 MAIL ADDRESS: STREET 1: 12750 MERIT DRIVE STREET 2: SUITE 1210 CITY: DALLAS STATE: TX ZIP: 75251 10-Q 1 FORM 10-Q 1 ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q [X] Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended March 31, 1995 or [ ] Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from ______ to _______ Commission file number 0-17171 URANIUM RESOURCES, INC. (exact name of Registrant as specified in its Charter) DELAWARE 75-2212772 (State of Incorporation) (I.R.S. Employer Identification No.)
12750 MERIT DRIVE, SUITE 1210, DALLAS, TEXAS 75251 (Address of principal executive offices, including zip code) (214) 387-7777 (Registrant's telephone number, including area code) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X ] No [ ] Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Title of Each Class of Common Stock Number of Shares Outstanding - ----------------------------------- ---------------------------- Common Stock, $.001 par value 8,049,307 as of May 19, 1995
================================================================================ 2 URANIUM RESOURCES, INC. 1995 FIRST QUARTERLY REPORT ON FORM 10-Q TABLE OF CONTENTS PART I - FINANCIAL INFORMATION Item 1. Financial Statements Consolidated Balance Sheets - March 31, 1995 (Unaudited) and December 31, 1994 3 Consolidated Statements of Operations - Three Months Ended March 31, 1995 and 1994 (Unaudited) 5 Consolidated Statements of Cash Flows - Three Months Ended March 31, 1995 and 1994 (Unaudited) 6 Notes to Consolidated Financial Statements - March 31, 1995 (Unaudited) 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 7 PART II -- OTHER INFORMATION 11 SIGNATURES 12 Index to Exhibits E-1
2 3 PART I - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS URANIUM RESOURCES, INC. CONSOLIDATED BALANCE SHEETS MARCH 31, 1995 AND DECEMBER 31, 1994 (NOTE 1) ASSETS
MARCH 31, DECEMBER 31, 1995 1994 ------------ ------------ (Unaudited) Current Assets: Cash and cash equivalents $ 43,468 $ 2,527,600 Short-term investments: Certificate of Deposit, restricted 562,341 562,211 Receivables 80,368 52,740 Uranium inventory 3,426,067 4,031,611 Materials and supplies inventory 162,365 162,417 Prepaid and other current assets 186,070 96,751 ------------ ------------ Total current assets 4,460,679 7,433,330 ------------ ------------ Property, plant and equipment, at cost: Uranium properties 53,707,527 53,210,132 Other property, plant and equipment 461,918 461,918 Less - accumulated depreciation and depletion (16,420,512) (16,345,645) ------------ ------------ Net property, plant and equipment 37,748,933 37,326,405 Other Assets 90,491 90,491 ------------ ------------ $ 42,300,103 $ 44,850,226 ------------ ------------
The accompanying notes to financial statements are an integral part of these consolidated balance sheets. 3 4 URANIUM RESOURCES, INC. CONSOLIDATED BALANCE SHEETS MARCH 31, 1995 AND DECEMBER 31, 1994 (NOTE 1) LIABILITIES AND SHAREHOLDERS' EQUITY
MARCH 31, DECEMBER 31, 1995 1994 ------------- ------------- (Unaudited) Current Liabilities: Accounts payable $ 1,621,517 $ 1,283,265 Short-term notes 6,491,738 7,739,225 Borrowings from related parties 90,000 - Accrued interest payable 163,248 27,744 Current portion of long-term debt 142,000 82,000 Royalties payable 509,606 509,606 Current portion of restoration reserve 65,000 90,000 Other accrued liabilities 603,290 246,790 ------------ ------------ Total current liabilities 9,686,399 9,978,630 ------------ ------------ Other long-term liabilities and deferred credits 2,341,910 2,337,624 Long-term debt, less current portion 1,345,507 1,405,507 Deferred federal income taxes 2,415,000 2,910,000 Shareholders' equity: Common stock, $.001 par value, 12,500,000 shares authorized; shares issued and outstanding (net of treasury shares): 1995 - 8,049,307; 1994 - 7,954,683 8,237 8,142 Paid-in capital 15,317,234 15,040,064 Retained earnings 11,197,396 13,181,839 ------------ ------------ 26,522,867 28,230,045 Less: Treasury stock (187,500 shares), at cost (11,580) (11,580) ------------ ------------ Total shareholders' equity 26,511,287 28,218,465 ------------ ------------ $ 42,300,103 $ 44,850,226 ------------ ------------
The accompanying notes to financial statements are an integral part of these consolidated balance sheets. 4 5 URANIUM RESOURCES, INC. CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 1995 AND 1994 (NOTE 1) (UNAUDITED)
MARCH 31, MARCH 31, 1995 1994 ------------ ----------- Revenues: Uranium Sales - Produced uranium $ - $ 33,465 Purchased uranium 1,251,013 878,664 ----------- ----------- Uranium sales 1,251,013 912,129 Costs and expenses: Cost of uranium sales - Direct cost of purchased uranium 612,813 530,686 Royalties and brokers' fees - 1,077 Operating expenses 245,584 337,351 Provision for restoration and reclamation costs - 1,312 Depreciation and depletion 40,465 71,929 Loss on termination of joint venture 1,000,953 - Loss on transfer to stockholder (Note 2) 1,080,000 - Corporate expenses - General and administrative 636,575 459,122 Depreciation 7,319 8,023 ----------- ----------- Total costs and expenses 3,623,709 1,409,500 ----------- ----------- Loss from operations (2,372,696) (497,371) Other income (expense): Interest expense, net of capitalized interest (154,980) (1,880) Interest and other income, net 48,233 54,443 ----------- ----------- Loss before income tax benefit (2,479,443) (444,808) Federal income tax benefit: Current - (155) Deferred (495,000) (89,000) ----------- ----------- Net loss $(1,984,443) $ (355,653) ----------- ----------- Net loss per common and common equivalent share $ (0. 25) $ (0.05) ----------- ----------- Weighted average common shares and common equivalent shares per share data 8,024,607 6,643,142 ----------- -----------
The accompanying notes to financial statements are an integral part of these consolidated statements. 5 6 URANIUM RESOURCES, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE THREE MONTHS ENDED MARCH 31, 1995 AND 1994 (NOTE 1) (UNAUDITED)
MARCH 31, MARCH 31, 1995 1994 ------------ ------------ Cash flows from operations: Net loss $(1,984,443) $ (355,653) Reconciliation of net income to cash provided by operations- Provision for restoration and reclamation costs - 1,312 Depreciation and depletion 47,784 79,952 Amortization of other assets - 56,257 Credit for deferred income taxes (495,000) (89,000) Decrease in restoration and reclamation accrual (22,243) (5,029) Other non-cash items, net 46,480 70,194 ----------- ----------- Cash flow used in operations, before changes in operating working capital items (2,407,422) (241,967) Effect of changes in operating working capital items - (Increase) decrease in receivables (27,628) 564,632 Decrease in inventories 612,221 40,119 (Increase) decrease in prepaid and other current assets (122,416) 8,352 Increase (decrease) in payables and accrued liabilities 830,256 (2,592,901) ----------- ----------- Net cash used in operations (1,114,989) (2,221,765) ----------- ----------- Investing activities: Increase in investments (130) (170) Additions to property, plant and equipment - Kingsville Dome (29,893) (52,616) Rosita (215,994) (22,647) Churchrock (166,473) (232,061) Crownpoint (54,186) (156,795) Other property (22,245) (24,619) Increase in other assets - (733) ----------- ----------- Net cash used in investing activities (488,921) (489,641) ----------- ----------- Financing activities: Proceeds from borrowings from related parties 90,000 - Proceeds from other borrowings - 1,125,000 Payments and refinancings of principal (1,247,487) (656,517) Issuance of common stock 277,265 17,640 ----------- ----------- Net cash provided by (used in) financing activities (880,222) 486,123 ----------- ----------- Net decrease in cash and cash equivalents (2,484,132) (2,225,283) Cash and cash equivalents, beginning of period 2,527,600 2,529,741 ----------- ----------- Cash and cash equivalents, end of period $ 43,468 $ 304,458 ----------- -----------
The accompanying notes to financial statements are an integral part of these consolidated statements. 6 7 URANIUM RESOURCES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 1995 (UNAUDITED) 1. BASIS OF PRESENTATION The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. The accompanying statements should be read in conjunction with the audited financial statements included in the Company's 1994 Annual Report on Form 10-K. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 1995 are not necessarily indicative of the results that may be expected for the full calendar year ending December 31, 1995. 2. LIQUIDITY ISSUES During January 1995, when Oren L. Benton was Chairman of the Company's Board of Directors, the Company transferred $1.0 million to certain companies controlled by Mr. Benton, in connection with a planned joint venture to process uranium. Because Mr. Benton and certain companies controlled by him (the "Benton Companies") filed for bankruptcy in February, it is doubtful that the Company will recover its investment. Also in January, Mr. Benton and the then Chief Financial Officer of the Company transferred $1.08 million out of the Company without the authorization of the Company's Board of Directors. The $1.08 million has not been recovered and it is uncertain whether the Company's efforts to pursue remedies for both transfers will be successful. The Company has recorded losses for these transactions in the first quarter of 1995 of $2.08 million. The bankruptcy could also cause a review of the transactions entered into by the Company with the Benton Companies that could potentially result in claims against the Company. The Company is unable to assess what adverse consequences, if any, might result from such review. On May 10, 1995, the Company reached an agreement with Ryback Management Company ("Ryback") on the principal terms of a proposed $6 million loan to the Company by two mutual funds managed by Ryback. Proceeds will be used to pay down existing payables and fund the reopening of the Company's Rosita and Kingsville Dome production facilities. See "Proposed Convertible Debt Financing" on page 8 herein. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS CAPITAL RESOURCES AND LIQUIDITY For the quarter ended March 31, 1995, the Company's cash and cash equivalents decreased $2,484,000 as compared to a decrease of $2,225,000 for 1994. The Company's uranium operations generated negative cash flow from operations of $1,115,000 for the quarter ended March 31, 1995, in comparison to negative cash flow from operations in the same period in 1994 of $2,222,000. The increase in 1995 cash flow from operations resulted primarily from the Company's inability to pay down existing payables. 7 8 The Company's net working capital at March 31, 1995, was a negative $5,226,000. This negative working capital includes $6,491,738 in a current note payable to Union Bank of Switzerland (the "UBS Note"). Under the terms of the note, the Company anticipates that it will within the next six months completely repay the UBS Note by applying substantially all the proceeds from its long-term sales contracts against this obligation. As a result of the Company applying the proceeds from these contracts in satisfaction of the UBS Note, the Company's only current source of cash flow will be from the proposed convertible debt financing. See Note 2 - Liquidity Issues. The Company defaulted on an interest payment of approximately $132,000 due on March 31, 1995 on the UBS Note. The Company cured the default on April 14, 1995. The Company has begun certain development activities at its Rosita site in anticipation of resuming production at this location in June, 1995. During the first quarter of 1995, $216,000 in development expenditures were incurred at Rosita. Capital expenditures to be incurred for the remainder of 1995 at Rosita are expected to be $2,218,000. Pre-production capital expenditures of $1,486,000 are anticipated to be expended at Kingsville Dome starting in August, 1995 with anticipation of production commencing in January, 1996. Additional capital expenditures including permitting, land acquisition and land holding costs at Churchrock, Crownpoint and Vasquez are expected to amount to approximately $542,000. Approximately $243,000 in capital expenditures were incurred on these properties in the first quarter of 1995. In mid-1994, the Company received notice from its largest uranium customer of a reduction in the 1995 deliveries to be made under the sales contract with that customer. The reduction was made due to reduced uranium requirements for the customer's nuclear reactors. Deliveries under this contract will be reduced to 55,000 pounds instead of the 240,000 pounds originally expected to be delivered under the terms of the contract. This change in scheduled deliveries under the contract will reduce the net income and cash flow originally expected in 1995 by approximately $3,400,000 when compared to the original base deliveries scheduled for the year. The 1995 deliveries represent the final year of sales to this customer under this contract. The Company continues actively to pursue obtaining new long-term matched sales contracts. The Company has contracted to deliver amounts in the future which are equal to its 1994 matched sales quota and has sales, pending contract finalization, which would meet a majority of the Company's 1995 quota. The Company must get at least one of its properties into production to take advantage of the matched sales program. However, the Company is unable to predict its liquidity situation on a long-term basis. Its future earnings and cash flow are dependent upon its ability to enter into additional long-term sales contracts at prices above its production costs. PROPOSED CONVERTIBLE DEBT FINANCING On May 10, 1995, the Company reached an agreement with Ryback on the principal terms of a $6 million loan to the Company by two mutual funds managed by Ryback. The loan will be for a term of three years, bear interest at an annual rate of 6.5% per annum and will be convertible into shares of the Company's common stock at an initial conversion price of $4.00 per share. The loan will be non-callable and secured by a mortgage on the Company's Rosita and Kingsville Dome uranium properties in Texas. In addition, the lender will receive a three-year warrant to purchase 1.5 million shares of the Company's common stock at an initial price of $4.00 per share. Following closing, the Company will seek ratification of the loan by its shareholders. Failure to receive shareholder ratification will constitute a default under the loan. Consummation of the loan is subject to satisfaction of certain conditions, including execution of mutually agreeable definitive documentation. If the conditions are met, the parties expect to consummate the transaction within 30 days. The proceeds of the loan would be used to pay down existing payables and fund the reopening of uranium production at the Company's Rosita and Kingsville Dome production facilities. ENVIRONMENTAL ASPECTS The Company utilizes ISL solution mining technology as its only mining method. Unlike conventional uranium mining companies, the Company's mining technology does not create "tailings". Nevertheless, the Company is highly regulated. Its primary environmental costs to date have been related to obtaining and complying with environmental mining permits and, once mining is completed, the reclamation and restoration of the surface areas and underground 8 9 water quality to a condition consistent with applicable requirements. Accruals for the estimated future cost of such activities are made on a per-pound basis as part of production costs. See the Consolidated Statements of Operations for the applicable provisions for such future costs. See also Note 1 - "Restoration and Reclamation Costs" of Notes to Consolidated Financial Statements in the Company's Form 10-K as of December 31, 1994. RESULTS OF OPERATIONS Revenues, earnings from operations and net income for the Company can fluctuate significantly on a quarter to quarter basis during the year because of the timing of deliveries requested by its utility customers. The Company's customers have generally elected, where possible, to take delivery of the bulk of the annual deliveries under their long term sales contracts later in each year. Accordingly, operating results for any quarter or year-to-date period are not necessarily comparable and may not be indicative of the results which may be expected for future quarters or the entire year. Three Months Ended March 31, 1995 and 1994 The following is a summary of the key operational and financial statistics related to the Results of Operations:
Three Months Ended ------------------- 1995 1994 -------- -------- (In Thousands) Uranium Sales Revenue $ 1,251 $ 912 Total Pounds Delivered 66.3 48.8 Average Sales Price/Pound $ 18.88 $ 18.71 Pounds Produced -- -- Pounds Purchased/Borrowed -- 50 Average Production Cost of Produced Pounds $ -- $ -- Average Cost of Purchased/Borrowed Pounds $ -- $ 9.49 Average Cost of Produced Pounds Sold $ -- $ 14.11 Average Cost of Purchased Pounds Sold $ 9.25 $ 11.29
Uranium sales revenues in 1995 increased by $339,000 from 1994 levels. Deliveries in 1995 were higher than those in 1994 (66,250 pounds in 1995 versus 48,750 pounds in 1994). Details of the cost of uranium sales were as follows:
Three Months Ended ------------------ 1995 1994 ---- ---- (In Thousands) Cost of purchased uranium $613 $531 Royalties and brokers' fees -- 1 Operating expenses 246 337 Provision for restoration and reclamation costs -- 1 Depreciation and depletion of uranium properties 40 72 ---- ---- Total cost of uranium sales $899 $942 ---- ----
9 10 The Company has had significant production from its Kingsville Dome and Rosita properties since the startup of Kingsville Dome in 1988 and Rosita in 1990. Due to declines in the spot price of uranium to levels at or below the Company's production costs, both of these facilities were placed on standby since September 1990 for Kingsville Dome and March 1992 for Rosita. The decline in production, and ultimately the shutdown of these two locations was done to enable the Company to take advantage of the low spot market prices available in order to purchase material to meet its long-term sales contract delivery commitments. Since January 1995, spot market prices have increased almost 30%. The Company has decided to commence production at Rosita in 1995 and commence pre-production development at Kingsville Dome towards production in early 1996 because of the increase in the spot market prices and in order to meet future deliveries under the Company's anticipated matched sales contracts. Deliveries in the first quarter of 1995 consisted of 66,250 purchased pounds, at an average cost per pound of $9.25. No uranium was purchased in 1995. Purchases of uranium in the first quarter of 1994 were made at an average price of $9.49 per pound. Deliveries in 1994 consisted of 47,001 purchased pounds, at an average cost per pound of $11.29 and 1,749 previously produced pounds at $14.11 per pound. Operating expenses attributable to the sale of the Company's produced pounds totaled approximately $13,000 for the first quarter of 1994. Operating expenses and depreciation and depletion in the first quarter of 1995 and 1994 include standby costs for Kingsville Dome and Rosita. These costs have been recorded as direct charges to operations. Standby costs for the first quarters of 1995 and 1994 where $286,000 and $394,000, respectively. The provision for restoration and reclamation in the first quarter of 1994 consists entirely of the $0.75 per pound provision for Rosita production sold during the year of $1,300. The first quarter 1995 provision for depreciation and depletion is comprised entirely of Rosita and Kingsville Dome depreciation while on standby of $40,000. The provision for depreciation and depletion in the first quarter of 1994 was comprised of the $5.70 rate per pound ($10,000) for Rosita production sold and Rosita and Kingsville Dome depreciation while on standby of $62,000. Corporate expenses consisting of general and administrative ("G & A") expenses and depreciation of G & A fixed assets increased to $644,000 in the first quarter of 1995 from $467,000 in the first quarter of 1994. This increase resulted primarily from legal and accounting fees and other non-recurring expenses relating to the bankruptcy proceedings of certain of the Benton Companies and the Company's liquidity issues. Loss from operations in the first quarter of 1995 was $2,373,000 compared to a loss in the first quarter of 1994 of $497,000. This reduction was attributable to a loss on the termination of a proposed joint venture of $1.0 million and a loss on a transfer to the Benton Companies of $1.08 million. See Note 2 - Liquidity Issues for a further discussion. Total interest costs in 1995, including capitalized amounts, decreased by $24,000 when compared to 1994. This decrease from $182,000 in 1994 to $158,000 in 1995, was a result of a lower average outstanding debt balance in the current year. Of the total interest costs, $3,000, and $180,000 were capitalized in the 1995 and 1994 periods, respectively. 10 11 PART II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS None. ITEM 2. CHANGES IN SECURITIES. None ITEM 3. DEFAULTS UPON SENIOR SECURITIES. The Company defaulted on an interest payment of approximately $132,000 due on March 31, 1995 on the UBS Note. The Company cured the default on April 14, 1995. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. None ITEM 5. OTHER INFORMATION. None ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. (a) Exhibits 10.1 Promissory Note in the amount of $65,000 dated February 24, 1995 between URI, Inc. and the Company all as the maker and Wallace M. Mays as lender 10.2 Promissory Note in the amount of $25,000 dated March 27, 1995 between URI, Inc. and the Company all as the maker and Wallace M. Mays as lender 10.3 Deed of Trust, Security Agreement and Financing Statement dated March 27, 1995 between URI, Inc. as the debtor and Wallace M. Mays as the secured party 27 Financial Data Schedule
(b) Reports on Form 8-K. None 11 12 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. URANIUM RESOURCES, INC. Dated: May 19, 1995 By: /s/ WALLACE M. MAYS Wallace M. Mays, Director and Chief Executive Officer (Principal Executive Officer) Dated: May 19, 1995 By: /s/ PAUL K. WILLMOTT Paul K. Willmott, President, Director and Principal Financial and Accounting Officer 12 13 INDEX TO EXHIBITS
SEQUENTIALLY NUMBERED EXHIBITS DESCRIPTION PAGE - -------- ----------- ------------ 10.1 Promissory Note in the amount of $65,000 dated February 24, 1995 between URI, Inc. and the Company all as the maker and Wallace M. Mays as lender 10.2 Promissory Note in the amount of $25,000 dated March 27, 1995 between URI, Inc. and the Company all as the maker and Wallace M. Mays as lender 10.3 Deed of Trust, Security Agreement and Financing Statement dated March 27, 1995 between URI, Inc. as the debtor and Wallace M. Mays as the secured party 27 Financial Data Schedule
E-1 EX-10.1 2 PROMISSORY NOTE 1 EXHIBIT 10.1 2 PROMISSORY NOTE (SECURED) $65,000.00 February 24, 1995 Denver, Colorado FOR VALUE RECEIVED, URANIUM RESOURCES, INC., a Delaware corporation and URI, Inc., a Delaware corporation which is a wholly owned subsidiary of Uranium Resources, Inc. (collectively referred to hereinafter as "Maker"), promises to pay to the order of WALLACE M. MAYS, an individual resident of Denver, Colorado ("Lender"), at 490 Williams Street Parkway, Denver, Colorado, or at such other place as Lender may designate from time to time, the principal amount of Sixty-Five Thousand and No/100 Dollars ($65,000.00)(the "Principal Balance"), together with interest thereon as hereinafter provided, in lawful money of the United States of America. The Principal Balance hereof together with interest is payable on demand ("Maturity Date"); provided, however, that the Lender shall refrain from making demand until the earlier to occur of June 27, 1995 or the raising of capital of not less than $1 million by Maker. This Note shall be secured by certain mining properties owned by Maker in the State of Texas which shall be subject to a deed of trust and security agreement (the "Deed of Trust") dated March 27, 1995. Capitalized terms used herein and not otherwise defined herein shall have the meanings assigned thereto in the Deed of Trust. INTEREST RATE: The entire outstanding Principal Balance of this Note shall accrue interest at a fluctuating rate per annum equal to the rate of interest announced publicly by Citibank, N.A. in New York from time to time as its prime rate (the "Prime Rate"), plus three percent (3%). Interest on the indebtedness evidenced by this Note shall be calculated on the basis of a year of 365 days and interest shall be computed at all times upon the unpaid Principal Balance. PREPAYMENT: All or any portion of the Principal Balance may be prepaid at any time and from time to time, without premium or penalty but with accrued and unpaid interest to the date of prepayment on the amount so prepaid. GENERAL TERMS: If the Principal Balance of this Note, accrued and unpaid interest and/or other charges due hereunder are not paid when due either on demand, the Maturity Date or such earlier date as herein provided or as a result of acceleration, such sums will bear interest from the due date at a rate ("Default Rate") equal to five percent (5%) per annum in excess of the Prime Rate, provided, however, that in no event shall the Default Rate be greater than that allowed by law. The failure to timely pay any amount due and owing under the terms of this Note shall be an Event of Default. 2 3 If an Event of Default shall occur, the entire unpaid Principal Balance hereof, together with any accrued interest, shall, at the option of Lender, become immediately due and payable upon five (5) days prior written notice to Maker and whether or not such option has been exercised, the outstanding Principal Balance shall thereafter bear interest at the Default Rate. The failure of Lender to exercise its rights hereunder upon the occurrence of one or more Events of Default shall not constitute a waiver of its rights in the event of any subsequent or continuing default. The remedies of Lender provided herein, or in any instrument securing or guaranteeing payment hereof, at law or in equity, shall be cumulative and concurrent, and may be pursued singly, successively, or together at the sole discretion of Lender, and may be exercised as often as occasion for such exercise shall occur, and the failure to exercise any such right or remedy shall in no event be construed as a waiver or release thereof. Maker agrees that if, and as often as, this Note is placed in the hands of an attorney for collection or to defend or enforce any of Lender's rights hereunder or under any instrument securing or guaranteeing payment of this Note or to protect or foreclose upon the security for this Note, Maker will pay to Lender its reasonable costs of collection or enforcement, including without limitation, attorneys' fees and all court costs and reasonable expenses incurred in connection therewith including those costs, expenses and attorneys' fees incurred after the filing by or against the Maker of any proceeding under any chapter of the Bankruptcy Code, Title 11 of the Unites States Code, or similar federal or state statute, and whether incurred in connection with the involvement of the Lender or any holder hereof as creditor in such proceedings or otherwise. For so long as Maker is not in default hereunder, all payments received by Lender on this Note shall be applied as follows, regardless of any designation elsewhere herein of such payments as principal, interest or other charges: first, to the repayment of sums advanced by Lender pursuant to the terms of the Deed of Trust for the payment of taxes, assessments, insurance premiums or other charges against the collateral (together with interest thereon from the date of advance until the date repaid), then the payment of any outstanding costs of collection or enforcement, attorneys' fees, court costs and other charges due hereunder, then to the payment of accrued but unpaid interest which is then due and payable, and finally, to reduction of the outstanding Principal Balance of this Note. From and after the occurrence of an Event of Default, all payments received by Lender on this Note shall be applied by Lender to attorneys' fees, court costs, costs of collection or enforcement, principal, interest and/or other charges due hereunder or under the Deed of Trust in such order as Lender shall determine in its sole discretion. If the Maker shall sell, exchange, convey, alienate, lease, encumber or otherwise dispose of (including without limitation a sale under contract) the property which is the security for this Note, or any part thereof, or any interest therein, or shall be divested of his title or any interest therein in any manner whatsoever, either voluntarily or involuntarily, without the express prior written consent of the Lender, then the entire unpaid balance of this Note, irrespective of the maturity date otherwise expressly hereinabove, at the option of the Lender and without demand or notice shall immediately become due and payable. All notices, demands, requests or other communications to be sent by one party to the other hereunder or required by law shall be in writing and shall be deemed to have been validly given or served by delivery of the same in person to the intended addressee, or by depositing the same within Federal Express or another reputable private courier service for next business day delivery, or by depositing the same in 3 4 the United States mail, postage prepaid, certified, return receipt requested, addressed as follow: Maker's Address: Uranium Resources, Inc. URI, Inc. Three Park Central, Suite 1100 1515 Arapahoe Street Denver, Colorado 80202 Attn: Paul K. Willmott, President of Uranium Resources, Inc. Lender's Address: Wallace M. Mays 490 Williams Street Parkway Denver, Colorado 80218 With a Copy to: Leonard N. Waldbaum, Esq. Waldbaum, Corn, Koff, Berger & Cohen, P.C. 303 East Seventeenth Avenue Suite 940 Denver, Colorado 80203 All notices, demands and requests shall be effective upon such personal delivery, or one(1) business day after being deposited with the private courier service, or two (2) business days after being deposited in the United States mail as required above. Rejection or other refusal to accept or the inability to deliver because of changed address to which notice was sent as herein required shall be deemed to be receipt of the notice, demand or request sent. By giving to the other party hereto at least five (5) business days' prior written notice thereof in accordance with the provisions hereof, the parties hereto shall have the right from time to time to change their respective addresses and each shall have the right to specify as its address any other address within the United States of America. All agreements between Maker and Lender expressly are limited so that in no event whatsoever, whether by reason of disbursement of the proceeds hereof or otherwise, shall the amount paid or agreed to be paid by Maker to Lender for the use, detention or forbearance of the amounts to be disbursed hereunder exceed the highest lawful contractual rate of interest permissible under the law which a court of competent jurisdiction, by a final, nonappealable order, determines is applicable hereto. If fulfillment of any provision herein contained at the time performance of such provisions becomes due involves exceeding such highest lawful contractual rate, then IPSO FACTO, the obligation to fulfill the same shall be reduced to such highest lawful contractual rate. In determining whether the amount of interest contracted for, charged or received with respect to this Note or the Deed of Trust exceeds the amount permitted by applicable law, all sums paid or agreed to be paid to the Lender for the use, forbearance, or detention of the indebtedness of the Maker to the Lender shall, to the extent permitted by applicable law, be amortized, pro rated, allocated and spread throughout the full term of this Note until payment in full so that the rate of interest is uniform throughout its term. If by any circumstance the Lender shall ever receive as interest, an amount which would exceed such highest lawful contractual rate, the amount which may be deemed excessive interest shall be applied to the principal of the indebtedness evidenced hereby as of the day such payment was received and not to interest. The terms and provisions of this paragraph shall control all other terms and provisions contained herein, and in any document or instrument securing or guaranteeing 4 5 the indebtedness evidenced by this Note. If any provision of this Note or the application thereof to any party or encumbrance is held invalid or unenforceable, the remainder of this Note and the application of such provision to other parties or circumstances shall not be affected thereby, the provisions of this Note being severable in any such instance. Time is of the essence of this Note. Any waiver of any payment hereunder or under the Deed or Trust securing this Note at any time, shall not, at any other time, be taken to be a waiver of the terms of this Note, or the Deed of Trust securing it. On failure of the Maker in the performance of any agreement contained in the Deed of Trust or upon insolvency, appointment of a Receiver of any part of the property of, assignment for benefit of creditors by, or the commencement of any such proceedings by or against the Maker, all sums hereunder may become due and payable at once at the option of the Lender or holder(s) of this Note. Failure to exercise the option to accelerate shall not constitute a waiver of the right to exercise the same in the event of any subsequent default. Maker, endorsers, sureties, guarantors and all persons who may become liable for all or any part of this obligation, severally expressly waive demand, protest, presentment and notice of dishonor and consent to any extension of time (whether one or more) of the payment hereof, release of all or any part of the security for the payment hereof and the taking or release of other or additional security. Such extensions or release of any party liable may be made at any time and from time to time without notice to any such party and without discharging such party's liability hereunder or under any guaranty hereof. Whenever used herein, the words "Maker" and "Lender" shall be deemed to include the respective successors and assigns of Maker and Lender. This Note is issued by Maker and accepted by Lender pursuant to a lending transaction negotiated and consummated in Denver, Colorado and this Note is to be governed by and construed according to the laws of the State of Colorado. Exclusive venue for any action arising out of this Note shall be in Denver County, Colorado, and venue in any other jurisdiction is hereby waived by the parties. The captions and headings of the various sections of this Note are for convenience only, and are not to be construed as confining or limiting in any way the scope or intent of the provisions hereof. IN WITNESS WHEREOF, Maker has executed this instrument on the date first above written. MAKER: URI, INC., a Delaware corporation URANIUM RESOURCES, INC., a Delaware corporation BY: Paul K. Willmott BY: Paul K. Willmott NAME: Paul K. Willmott NAME: Paul K. Willmott TITLE: President TITLE: President 5 EX-10.2 3 PROMISSORY NOTE 1 EXHIBIT 10.2 2 PROMISSORY NOTE (SECURED) $25,000.00 March 27, 1995 Denver, Colorado FOR VALUE RECEIVED, URANIUM RESOURCES, INC., a Delaware corporation and URI, Inc., a Delaware corporation which is a wholly owned subsidiary of Uranium Resources, Inc. (collectively referred to hereinafter as "Maker"), promises to pay to the order of WALLACE M. MAYS, an individual resident of Denver, Colorado ("Lender"), at 490 Williams Street Parkway, Denver, Colorado, or at such other place as Lender may designate from time to time, the principal amount of Twenty-Five Thousand and No/100 Dollars ($25,000.00)(the "Principal Balance"), together with interest thereon as hereinafter provided, in lawful money of the United States of America. The Principal Balance hereof together with interest is payable on demand ("Maturity Date"); provided, however, that the Lender shall refrain from making demand until the earlier to occur of June 27, 1995 or the raising of capital of not less than $1 million by Maker. This Note shall be secured by certain mining properties owned by Maker in the State of Texas which shall be subject to a deed of trust and security agreement (the "Deed of Trust") dated March 27, 1995. Capitalized terms used herein and not otherwise defined herein shall have the meanings assigned thereto in the Deed of Trust. INTEREST RATE: The entire outstanding Principal Balance of this Note shall accrue interest at a fluctuating rate per annum equal to the rate of interest announced publicly by Citibank, N.A. in New York from time to time as its prime rate (the "Prime Rate"), plus three percent (3%). Interest on the indebtedness evidenced by this Note shall be calculated on the basis of a year of 365 days and interest shall be computed at all times upon the unpaid Principal Balance. PREPAYMENT: All or any portion of the Principal Balance may be prepaid at any time and from time to time, without premium or penalty but with accrued and unpaid interest to the date of prepayment on the amount so prepaid. GENERAL TERMS: If the Principal Balance of this Note, accrued and unpaid interest and/or other charges due hereunder are not paid when due either on demand, the Maturity Date or such earlier date as herein provided or as a result of acceleration, such sums will bear interest from the due date at a rate ("Default Rate") equal to five percent (5%) per annum in excess of the Prime Rate, provided, however, that in no event shall the Default Rate be greater than that allowed by law. The failure to timely pay any amount due and owing under the terms of this Note shall be an Event of Default. 2 3 If an Event of Default shall occur, the entire unpaid Principal Balance hereof, together with any accrued interest, shall, at the option of Lender, become immediately due and payable upon five (5) days prior written notice to Maker and whether or not such option has been exercised, the outstanding Principal Balance shall thereafter bear interest at the Default Rate. The failure of Lender to exercise its rights hereunder upon the occurrence of one or more Events of Default shall not constitute a waiver of its rights in the event of any subsequent or continuing default. The remedies of Lender provided herein, or in any instrument securing or guaranteeing payment hereof, at law or in equity, shall be cumulative and concurrent, and may be pursued singly, successively, or together at the sole discretion of Lender, and may be exercised as often as occasion for such exercise shall occur, and the failure to exercise any such right or remedy shall in no event be construed as a waiver or release thereof. Maker agrees that if, and as often as, this Note is placed in the hands of an attorney for collection or to defend or enforce any of Lender's rights hereunder or under any instrument securing or guaranteeing payment of this Note or to protect or foreclose upon the security for this Note, Maker will pay to Lender its reasonable costs of collection or enforcement, including without limitation, attorneys' fees and all court costs and reasonable expenses incurred in connection therewith including those costs, expenses and attorneys' fees incurred after the filing by or against the Maker of any proceeding under any chapter of the Bankruptcy Code, Title 11 of the Unites States Code, or similar federal or state statute, and whether incurred in connection with the involvement of the Lender or any holder hereof as creditor in such proceedings or otherwise. For so long as Maker is not in default hereunder, all payments received by Lender on this Note shall be applied as follows, regardless of any designation elsewhere herein of such payments as principal, interest or other charges: first, to the repayment of sums advanced by Lender pursuant to the terms of the Deed of Trust for the payment of taxes, assessments, insurance premiums or other charges against the collateral (together with interest thereon from the date of advance until the date repaid), then the payment of any outstanding costs of collection or enforcement, attorneys' fees, court costs and other charges due hereunder, then to the payment of accrued but unpaid interest which is then due and payable, and finally, to reduction of the outstanding Principal Balance of this Note. From and after the occurrence of an Event of Default, all payments received by Lender on this Note shall be applied by Lender to attorneys' fees, court costs, costs of collection or enforcement, principal, interest and/or other charges due hereunder or under the Deed of Trust in such order as Lender shall determine in its sole discretion. If the Maker shall sell, exchange, convey, alienate, lease, encumber or otherwise dispose of (including without limitation a sale under contract) the property which is the security for this Note, or any part thereof, or any interest therein, or shall be divested of his title or any interest therein in any manner whatsoever, either voluntarily or involuntarily, without the express prior written consent of the Lender, then the entire unpaid balance of this Note, irrespective of the maturity date otherwise expressly hereinabove, at the option of the Lender and without demand or notice shall immediately become due and payable. All notices, demands, requests or other communications to be sent by one party to the other hereunder or required by law shall be in writing and shall be deemed to have been validly given or served by delivery of the same in person to the intended addressee, or by depositing the same within Federal Express or another reputable private courier service for next business day delivery, or by depositing the same in 3 4 the United States mail, postage prepaid, certified, return receipt requested, addressed as follow: Maker's Address: Uranium Resources, Inc. URI, Inc. Three Park Central, Suite 1100 1515 Arapahoe Street Denver, Colorado 80202 Attn: Paul K. Willmott, President of Uranium Resources, Inc. Lender's Address: Wallace M. Mays 490 Williams Street Parkway Denver, Colorado 80218 With a Copy to: Leonard N. Waldbaum, Esq. Waldbaum, Corn, Koff, Berger & Cohen, P.C. 303 East Seventeenth Avenue Suite 940 Denver, Colorado 80203 All notices, demands and requests shall be effective upon such personal delivery, or one(1) business day after being deposited with the private courier service, or two (2) business days after being deposited in the United States mail as required above. Rejection or other refusal to accept or the inability to deliver because of changed address to which notice was sent as herein required shall be deemed to be receipt of the notice, demand or request sent. By giving to the other party hereto at least five (5) business days' prior written notice thereof in accordance with the provisions hereof, the parties hereto shall have the right from time to time to change their respective addresses and each shall have the right to specify as its address any other address within the United States of America. All agreements between Maker and Lender expressly are limited so that in no event whatsoever, whether by reason of disbursement of the proceeds hereof or otherwise, shall the amount paid or agreed to be paid by Maker to Lender for the use, detention or forbearance of the amounts to be disbursed hereunder exceed the highest lawful contractual rate of interest permissible under the law which a court of competent jurisdiction, by a final, nonappealable order, determines is applicable hereto. If fulfillment of any provision herein contained at the time performance of such provisions becomes due involves exceeding such highest lawful contractual rate, then IPSO FACTO, the obligation to fulfill the same shall be reduced to such highest lawful contractual rate. In determining whether the amount of interest contracted for, charged or received with respect to this Note or the Deed of Trust exceeds the amount permitted by applicable law, all sums paid or agreed to be paid to the Lender for the use, forbearance, or detention of the indebtedness of the Maker to the Lender shall, to the extent permitted by applicable law, be amortized, pro rated, allocated and spread throughout the full term of this Note until payment in full so that the rate of interest is uniform throughout its term. If by any circumstance the Lender shall ever receive as interest, an amount which would exceed such highest lawful contractual rate, the amount which may be deemed excessive interest shall be applied to the principal of the indebtedness evidenced hereby as of the day such payment was received and not to interest. The terms and provisions of this paragraph shall control all other terms and provisions contained herein, and in any document or instrument securing or guaranteeing 4 5 the indebtedness evidenced by this Note. If any provision of this Note or the application thereof to any party or encumbrance is held invalid or unenforceable, the remainder of this Note and the application of such provision to other parties or circumstances shall not be affected thereby, the provisions of this Note being severable in any such instance. Time is of the essence of this Note. Any waiver of any payment hereunder or under the Deed or Trust securing this Note at any time, shall not, at any other time, be taken to be a waiver of the terms of this Note, or the Deed of Trust securing it. On failure of the Maker in the performance of any agreement contained in the Deed of Trust or upon insolvency, appointment of a Receiver of any part of the property of, assignment for benefit of creditors by, or the commencement of any such proceedings by or against the Maker, all sums hereunder may become due and payable at once at the option of the Lender or holder(s) of this Note. Failure to exercise the option to accelerate shall not constitute a waiver of the right to exercise the same in the event of any subsequent default. Maker, endorsers, sureties, guarantors and all persons who may become liable for all or any part of this obligation, severally expressly waive demand, protest, presentment and notice of dishonor and consent to any extension of time (whether one or more) of the payment hereof, release of all or any part of the security for the payment hereof and the taking or release of other or additional security. Such extensions or release of any party liable may be made at any time and from time to time without notice to any such party and without discharging such party's liability hereunder or under any guaranty hereof. Whenever used herein, the words "Maker" and "Lender" shall be deemed to include the respective successors and assigns of Maker and Lender. This Note is issued by Maker and accepted by Lender pursuant to a lending transaction negotiated and consummated in Denver, Colorado and this Note is to be governed by and construed according to the laws of the State of Colorado. Exclusive venue for any action arising out of this Note shall be in Denver County, Colorado, and venue in any other jurisdiction is hereby waived by the parties. The captions and headings of the various sections of this Note are for convenience only, and are not to be construed as confining or limiting in any way the scope or intent of the provisions hereof. IN WITNESS WHEREOF, Maker has executed this instrument on the date first above written. MAKER: URI, INC., a Delaware corporation URANIUM RESOURCES, INC., a Delaware corporation BY: Paul K. Willmott BY: Paul K. Willmott NAME: Paul K. Willmott NAME: Paul K. Willmott TITLE: President TITLE: President 5 EX-10.3 4 DEED OF TRUST 1 EXHIBIT 10.3 2 DEED OF TRUST, SECURITY AGREEMENT AND FINANCING STATEMENT THIS INSTRUMENT COVERS THE INTEREST OF DEBTOR IN MINERALS OR THE LIKE BEFORE EXTRACTION AND THE SECURITY INTEREST CREATED BY THIS INSTRUMENT ATTACHES TO SUCH MINERALS AS EXTRACTED AND TO THE ACCOUNTS RESULTING FROM THE SALE THEREOF AT THE MINEHEAD. THIS INSTRUMENT COVERS THE INTEREST OF DEBTOR IN FIXTURES. THIS FINANCING STATEMENT IS TO BE FILED FOR RECORD, AMONG OTHER PLACES, IN THE REAL ESTATE RECORDS. PRODUCTS OF THE COLLATERAL ARE ALSO COVERED. THE STATE OF TEXAS COUNTIES OF DUVAL AND KLEBERG This instrument is executed and delivered by URI, Inc. ("Debtor") whose address is 1515 Arapahoe Street, Denver, Colorado 80202, to Charley George Mays, Trustee, whose address is 5310 Windy Hill, Greenville, Texas 75401, for the benefit of Wallace M. Mays ("Secured Party") whose address is 490 Williams Street Parkway, Denver, Colorado 80218. ARTICLE I DEFINITIONS 1.1 "COLLATERAL" means the Realty Collateral, Personalty Collateral and Fixture Collateral. 1.2 "EVENT OF DEFAULT" shall have the meaning set forth in paragraph 4.1. 1.3 "FIXTURE COLLATERAL" means all of Debtor's interest now owned or hereafter acquired in and to all Fixture Operating Equipment and all proceeds, products, renewals, increases, profits, substitutions, replacements, additions, amendments and accessions thereof, thereto or therefor. 1.4 "FIXTURE OPERATING EQUIPMENT" means any of the items described in the first sentence of paragraph 1.9 which as a result of being incorporated into realty or structures or improvements located therein or thereon, with the intent that they remain there permanently, constitute fixtures under the laws of the state in which such equipment is located. 1.5 "MINERALS" means uranium in whatever form (including, without limitation, uranium ore and triuranium octoxide) and all other metallic and non-metallic minerals in and under or attributable to and that may be 3 produced, obtained or secured from, the lands covered and affected by the Mineral Properties, and all products produced therefrom. 1.6 "OBLIGATIONS" means (a) all indebtedness and obligations of Debtor under the Notes; and (b) all renewals, extensions, amendments, and substitutions of the above whether or not Debtor executes any renewal or extension agreement. 4 1.7 "MINERAL PROPERTY OR PROPERTIES" means (a) the fee lands, unpatented and patented mining claims, mining leases and other mineral interests described in Exhibit "A" attached hereto (b) any other interest in, to or relating to (i) all or any part of the land described either in Exhibit "A" or in the documents described in Exhibit "A" or (ii) any of the estates, property rights or other interests referred to above, and (c) any instrument executed in amendment, correction, modification, confirmation, renewal or extension of the same. 1.8 "NOTES" means collectively, (a) that certain promissory note dated February 24, 1995, executed by Debtor and Uranium Resources, Inc. and payable to the order of Secured Party in the original principal amount of $65,000.00; (b) that certain promissory note dated March 27, 1995, executed by Debtor and Uranium Resources, Inc. and payable to the order of Secured Party in the original principal amount of $25,000.00, and all renewals, extensions, substitutions and replacements thereof; and (c) up to an additional $109,000 which may be advanced from time to time by Secured Party to Debtor and/or Uranium Resources, Inc. 1.9 "OPERATING EQUIPMENT" means all surface or subsurface machinery, equipment, facilities, supplies or other property of whatsoever kind or nature (excluding drilling rigs, trucks, automotive equipment or other property taken to the premises for temporary uses) now or hereafter located on any of the property affected by the Mineral Properties which are required for the production, treatment, storage or transportation of Minerals, including, without limitation, the in situ solution leach mining facilities now existing or hereafter acquired or constructed, consisting of processing plants, process machinery, and equipment used in connection with such processing plants. 1.10 "PERMITTED LIENS" shall mean the liens and encumbrances described on Exhibit "B" attached hereto. 1.11 "PERSONALTY COLLATERAL" means all of Debtor's interest now owned or hereafter acquired in and to (i) all Operating Equipment, (ii) all proceeds and products of the Realty Collateral, and (iii) all proceeds, products, renewals, increases, profits, substitutions, replacements, additions, amendments and accessions of, to or for all of the property described in this subparagraph. 1.12 "REALTY COLLATERAL" means all of Debtor's interest now owned or hereafter acquired in and to (i) the Mineral Properties; (ii) water rights, ditch and ditch rights, reservoir and reservoir rights, and (iii) all unsevered and unextracted Minerals (even though Debtor's interest therein be incorrectly described in, or a description of a part or all of such interest be omitted from, Exhibit "A"). 5 ARTICLE II CREATION OF SECURITY 2.1 CONVEYANCE AND GRANT OF LIEN. To secure the payment of the Obligations, Debtor, by this instrument hereby grants, bargains, sells and conveys unto Trustee in trust for the benefit of Secured Party, the Realty Collateral and the Fixture Collateral. To have and to hold the Realty Collateral and Fixture Collateral unto the Trustee and his successors or substitutes in trust and to his and their assigns forever, together with all and singular the rights and appurtenances thereto in anywise belonging, to secure payment of the Obligations and the performance of the covenants of Debtor contained in this instrument, subject to all of the terms and conditions of this instrument and to the Permitted Liens. Debtor does hereby bind itself, its successors and permitted assigns, to warrant and forever defend all and singular the Realty Collateral and the Fixture Collateral unto the Trustee and his successors or substitutes in this Trust, against every person whomsoever, lawfully claiming or to claim the same, or any part thereof, by, through or under Debtor, provided, however, that if Debtor shall pay or cause to be paid the Obligations, as and when the same shall become due and payable, then the liens, security interests, estates and rights granted hereby shall terminate, in accordance with the provisions hereof, otherwise same shall remain in full force and effect. 2.2 SECURITY INTEREST. For the same consideration and to further secure the Obligations, Debtor hereby grants to Secured Party a security interest in and to the Personalty Collateral and the Fixture Collateral. ARTICLE III DEBTOR'S WARRANTIES AND COVENANTS 3.1 PAYMENT OF OBLIGATIONS. Debtor covenants that Debtor shall timely pay and perform the obligations secured by this instrument. 3.2 WARRANTIES. Debtor warrants as follows: (a) Title to Collateral. Debtor has good and marketable title to the Collateral free from all liens, security interests or other encumbrances except as specifically set forth in Exhibit "A", or as permitted by the provisions of Article 3.4(h) below. The representations of Debtor as to quantum and nature of the interest of Debtor in and to the Mineral Properties set forth on Exhibit "A" includes the entire interest of Debtor in the Mineral Properties and are complete and accurate in all respects. All patented and unpatented mining claims included in the Mineral Properties have been properly located and maintained. (b) Production Burdens, Taxes, Expenses and Revenues. All rentals, royalties, overriding royalty interests and other payments due under or with respect to the Mineral Properties have been properly and timely paid except for any such payments that are being contested in good faith by 6 appropriate proceedings and for which adequate reserves have been established. All ad valorem, property, production, severence and other taxes based on or measured by the ownership of the Properties or the production of Minerals therefrom have been properly and timely paid except for any such payments that are being contested in good faith by appropriate proceedings and for which adequate reserves have been established. All of the proceeds from the sale of Minerals are being properly and timely paid to Debtor by the purchasers thereof without suspense. (c) Production Balances. No person is entitled to receive deliveries of Minerals at any time after the date hereof without paying at such time the full contract price therefor. 3.3 FURTHER ASSURANCES. Debtor covenants that Debtor shall execute and deliver such other and further instruments, and shall do such other and further acts as in the reasonable opinion of Secured Party may be necessary or desirable to carry out more effectively the purposes of this instrument, including, without limiting the generality of the foregoing, (i) prompt correction of any defect in the execution or acknowledgment of this instrument, any written instrument comprising part or all of the Obligations, or any other document used in connection herewith; (ii) prompt correction of any defect which may hereafter be discovered in the title to the Collateral; and (iii) prompt payment when due and owing of all taxes, assessments and governmental charges imposed on this instrument, upon the interest of Secured Party or the Trustee, except those that are being contested in good faith by appropriate proceedings and for which appropriate reserves have been established. 3.4 OPERATION OF MINERAL PROPERTIES. As long as any of the Obligations remain unpaid or unsatisfied and whether or not Debtor is the operator of the Mineral Properties, Debtor shall (at Debtor's own expense) (a) not enter into any contract or agreement which materially adversely affects the Collateral; (b) cause each of the leases and mining claims and any water rights, rights-of-way, easements and privileges comprising any part of the Collateral to be kept in full force and effect by the payment of whatever sums may become payable and by the fulfillment of other obligations that may be required to prevent forfeiture or termination except for forfeitures and terminations in the ordinary course of business when no Event of Default is continuing of those water rights, rights-of-way, easements, privileges, leases and mining claims which are no longer necessary or desirable in the conduct of Debtor's business; (c) cause the Mineral Properties to be maintained, developed, and continuously operated for the production, processing and marketing of Minerals in a good and minerlike manner as a prudent operator would in accordance with (i) generally accepted practices, (ii) applicable leases and contracts, and (iii) all applicable Federal, state and local laws, rules and regulations; except where failure to do any of the foregoing would not have a material advance effect on Debtor's business, operations, financial condition or properties ("Material Adverse Effect") and would not cause any forfeiture of any part of the Collateral; 7 (d) promptly pay of cause to be paid when due and owing (i) all rentals and royalties payable in respect of the Collateral; (ii) all expenses incurred in or arising from the operation or development of the Collateral; (iii) all taxes, assessments and governmental charges imposed upon the Collateral, upon the income and profits from any of the Collateral, or upon Secured Party because of its interest therein; and (iv) all local, state and federal taxes, payments and contributions for which Debtor may be liable; except where failure to do any of the foregoing would not have a Material Adverse Effect and would not cause any forfeiture or termination of any part of the Collateral; (e) promptly take all action necessary to enforce or secure the observance or performance of any term, covenant, agreement or condition to be observed or performed by third parties under any material contract other than sales contracts, or any part thereof, or to exercise any of its rights, remedies, powers and privileges under any material contract, all in accordance with the respective terms thereof; (f) obtain and maintain in full force and effect all licenses, permits, franchises and other governmental and private authorizations and rights necessary in the operation of Debtor's business; (g) permit, and do all things necessary to enable, the Trustee and Secured Party (through its agents and employees) to enter upon the Mineral Properties at any reasonable time for the purpose of investigating and inspecting the condition and operations of the Collateral; (h) cause the Collateral to be kept from and clear of liens, charges, security interests and encumbrances of every character other than Permitted Liens; and (i) properly and timely perform all assessment work required to maintain any mining claims constituting any part of the Mineral Properties and properly and timely file and record all reports of such assessment work. 3.5 RECORDING. Debtor shall promptly (at Debtor's own expense) record, register, deposit and file this and every other instrument in addition or supplement hereto, including applicable financing statements, in such offices and places within the state where the Collateral is located and at such times and as often as may be reasonably necessary to create, perfect, maintain and preserve the lien and security interest herein created as a first lien or prior security interest on real or personal property as the case may be, and otherwise shall do and perform all matters or things necessary to be done or observed by reason of any applicable law or regulation or any state or of the United States or any other competent authority for the purpose of effectively creating, perfecting, maintaining and preserving the lien and security interest created hereby in and on the Collateral. 8 ARTICLE IV DEFAULT 4.1 EVENTS OF DEFAULT. Debtor will be in default under this instrument upon the occurrence of any of the following events (each such event, an "Event of Default"): (a) Debtor shall fail to pay when due the Obligations and such failure shall continue for a period of sixty (60) days after written notice thereof is delivered to Debtor. (b) The Debtor shall fail to perform, observe, or comply with any covenant, agreement, or term contained in this Agreement (other than covenants to pay the Obligations) and such failure shall continue for a period of sixty (60) days after notice thereof to Borrower. (c) The Debtor shall commence a voluntary proceeding seeking liquidation, reorganization, or other relief with respect to itself or its debts under any bankruptcy, insolvency, or other similar law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian, or other similar official of it or a substantial part of its property or shall consent to any such relief or to the appointment of or taking possession by any such official in an involuntary case or other proceeding commenced against it or shall make a general assignment for the benefit of creditors or shall generally fail to pay its debts as they become due or shall take any corporate action to authorize any of the foregoing. (d) An involuntary proceeding shall be commenced against the Debtor seeking liquidation, reorganization, or other relief with respect to it or its debts under any bankruptcy, insolvency, or other similar law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian, or other similar official for it or a substantial part of its property, and such involuntary proceeding shall remain undismissed and unstayed for a period of ninety (90) days. 4.2 RIGHTS UPON DEFAULT. If any Event of Default has occurred and is continuing, Secured Party may, at its option, declare the entire unpaid principal of and accrued and unpaid interest on the obligations to be forthwith due and payable, without (except as provided in the Notes) any protest, presentment, demand, notice of intent to accelerate, notice of acceleration or further notice of any kind, all of which are hereby expressly waived by Debtor, and/or exercise any other rights and remedies available to Secured Party. ARTICLE V SECURED PARTY'S RIGHTS 5.1 RIGHTS TO REALTY COLLATERAL UPON DEFAULT (a) Operation of property by Secured Party. Upon the occurrence and during the continuance of an Event of Default, and in addition to all other rights of Secured Party, Secured Party shall have the following rights and powers (but no obligation), at the Debtor's expense: 9 (i) To enter upon and take possession of any of the Realty Collateral, to exclude Debtor therefrom, and to hold, use, administer, manage and operate the same to the extent that Debtor could do so; (ii) To operate the Realty Collateral, without any liability to Debtor in connection with such operations, except for failure to use ordinary care in such operations; and (iii) To the extent that Debtor could do so, to collect, receive and receipt for all Minerals produced and sold from the Realty Collateral, to make repairs, to purchase machinery and equipment, to conduct workover operations, to drill additional wells, and to exercise every power, right and privilege of Debtor with respect to the Realty Collateral. When and if the reasonable expenses of such operation and development (including costs of unsuccessful workover operations or additional wells) and the other Obligations have been paid, the Realty Collateral shall be returned to Debtor (providing there has been no foreclosure sale). (b) Judicial Proceedings. Upon the occurrence and during the continuance of an Event of Default, the Trustee, in lieu of or in addition to exercising the power of sale hereafter given, may proceed by a suit or suits, in equity or at law (i) for the specific performance of any covenant or agreement herein contained or in aid of the execution of any power herein granted, (ii) for the appointment of a receiver pending any foreclosure hereunder or the sale of the Realty Collateral, or (iii) for the enforcement of any other appropriate legal or equitable remedy; and further, in lieu of the non-judicial power of sale hereafter given for Collateral located in the State of Texas, the Trustee may proceed by suit for a sale of the Realty Collateral. (c) Foreclosure by Private Power of Sale of Collateral. Upon the occurrence and during the continuance of an Event of Default, the Trustee shall have the right and power to sell, as the Trustee may elect, all or a portion of the Collateral at one or more sales as an entirety or in parcels, in accordance with Section 51.002 of the Texas Property Code. Debtor hereby designates as Debtor's address for the purpose of notice the address set out at the end of this instrument. Any purchaser or purchasers will be provided with a general warranty conveyance, subject to Permitted Liens, binding Debtor and Debtor's successors and assigns. Sale of a part of the Realty Collateral will not exhaust the power of sale, and sales may be made from time to time until all of the Realty Collateral is sold or all of the Obligations are paid in full. The Trustee will have the authority to appoint an attorney- in-fact to act as trustee in conducting the foreclosure sale and executing a deed to the purchaser or purchasers. (d) Certain Aspects of Sale. Secured Party will have the right to become the purchaser at any foreclosure sale and to credit the then outstanding balance of the Obligations against the amount payable by Secured Party as purchaser at such sale. Recitals contained in any conveyance to any purchaser or purchasers at any sale made hereunder will constitute prima facie evidence of the failure of Debtor to pay the Obligations or perform its covenants under this instrument, advertisement and conduct of such sale in the manner provided herein, appointment of any successor-Trustee hereunder and the 10 truth and accuracy of all other matters stated therein. Debtor hereby irrevocably appoints Trustee to be the attorney of Debtor and in the name and on behalf of Debtor to execute and deliver upon the occurrence and during the continuance of an Event of Default any deeds, transfers, conveyances, assignments, assurances and notices which Debtor is required to execute and deliver and do and perform any and all such acts and things which Debtor is required to do and perform under the covenants herein contained and generally to use the name of Debtor in the exercise of all or any of the powers hereby conferred on Trustee. Upon any sale, whether under the power of sale hereby given or by virtue of judicial proceedings, it shall not be necessary for Trustee or any public officer acting under execution or by order of court, to have physically present or constructively in his possession any of the Collateral, and Debtor hereby agrees to deliver all of such personal property to the purchaser or purchasers at such sale at the date of sale and if it should be impossible or impracticable to make actual delivery of such property, then the title and right of possession to such property shall pass to the purchaser or purchasers at such sale as completely as if the same had been actually present and delivered. (e) Receipt to Purchaser. Upon any sale made under the power of sale herein granted, the receipt of the Trustee will be sufficient discharge to the purchaser or purchasers at any sale for its purchase money, and such purchaser or purchasers, will not, after paying such purchase money and receiving such receipt of the Trustee, be obligated to see to the application of such purchase money or to be responsible for any loss, misapplication or non-application thereof. (f) Effect of Sale. Any sale or sales of the Realty Collateral will operate to divest all right, title, interest, claim and demand whatsoever, either at law or in equity, of Debtor, in and to the premises and the Realty Collateral sold, and will be a perpetual bar both at law and in equity, against Debtor, Debtor's successors or assigns, and against any and all persons claiming or who shall thereafter claim, all or any of the Realty Collateral sold by, through or under Debtor, or Debtor's successors or assigns. Nevertheless, if requested by the Trustee so to do, Debtor shall join in the execution and delivery of all proper conveyances, assignments and transfers of the property so sold. The purchaser or purchasers at the foreclosure sale will receive as incident to his, its or their own ownership, immediate possession of the Realty Collateral purchased and the Debtor agrees that if Debtor retains possession of the Realty Collateral or any part thereof subsequent to such sale, Debtor will be considered a tenant at sufferance of the purchaser or purchasers and will be subject to eviction and removal by any lawful means, with or without judicial intervention, and all damages by reason thereof are hereby expressly waived. (g) Application of Proceeds. The proceeds of any sale of the Realty Collateral or any part thereof, whether under the power of sale herein granted and conferred or by virtue of judicial proceedings, will be applied (A) first, to the payment of all reasonable out-of-pocket expenses incurred by the Trustee in the performance of his duties including, without limiting the generality of the foregoing, court costs, compensation of agents and employees, and legal fees, plus expenses of any entry or taking of possession, sale, advertising or conveyance thereof; (B) second, to the payment of the Obligations; and (C) third, the balance, if any, thereafter 11 remaining will be paid to Debtor or Debtor's successors or assigns as their interests may appear. Debtor shall remain liable for any deficiency remaining after the sale. 5.2 RIGHTS TO PERSONALTY COLLATERAL UPON DEFAULT. Upon the occurrence and during the continuance of an Event of Default, Secured Party may proceed against the Personalty Collateral in accordance with the rights and remedies granted herein with respect to the Realty Collateral, or will have all rights and remedies granted by the Uniform Commercial Code and this instrument. If an Event of Default has occurred and is continuing, Secured Party shall have the right to take possession of the Personalty Collateral, and for this purpose Secured Party may enter upon any premises on which any or all of the Personalty Collateral is situated and, to the extent that Debtor could do so, take possession of and operate the Personalty Collateral or remove it therefrom. Secured Party may require Debtor to assemble the Personalty Collateral and make it available to Secured Party at a place to be designated by Secured Party which is reasonably convenient to both parties. Unless the Personalty Collateral is perishable or threatens to decline speedily in value or is of a type customarily sold on a recognized market, Secured Party will send Debtor 10 days prior written notice of the time and place of any public sale or of the time after which any private sale or other disposition of the Personalty Collateral is to be made. This requirement of sending reasonable notice will be met if such notice is mailed, postage prepaid, to Debtor at the address designated in Section 6.12 hereof (or such other address as has been designated as provided herein) at least ten days before the time of the sale or disposition. In addition to the reasonable expenses of retaking, holding, preparing for sale, selling and the like, Secured Party will be entitled to recover reasonable attorney's fees and legal expenses as provided for in this instrument and in writings evidencing said obligations before applying the balance of the proceeds from the sale or other disposition toward satisfaction of the obligations. Debtor will remain liable for any deficiency remaining after the sale or other disposition. 5.3 RIGHTS TO FIXTURE COLLATERAL UPON DEFAULT. Upon the occurrence and during the continuance of an Event of Default, Secured Party may elect to treat the Fixture Collateral as either Realty Collateral or as Personalty Collateral (but not both) and proceed to exercise such rights as apply to the type of Collateral selected. ARTICLE VI MISCELLANEOUS 6.1 SUCCESSOR TRUSTEES. The Trustee may resign in writing addressed to Secured Party or be removed at any time with or without cause by an instrument in writing duly executed by Secured Party. In case of the death, resignation or removal of the Trustee, a successor Trustee may be appointed by the Secured Party by instrument of substitution complying with any applicable requirements of law, and in the absence of any requirement, without other formality other than an appointment and designation in writing. The appointment and designation will vest in the named successor Trustee all the estate and title of the Trustee in all of the Collateral and all of the rights, powers, privileges, immunities and duties hereby conferred upon the 12 Trustee. All references herein to the Trustee will be deemed to refer to the successor Trustee from time to time acting hereunder. 6.2 ADVANCES BY SECURED PARTY OR THE TRUSTEE. Each and every covenant of Debtor herein contained shall be performed and kept by Debtor solely at Debtor's expense. If Debtor fails to perform or keep any of the covenants of whatsoever kind or nature contained in this instrument, Secured Party (either by it directly or on its behalf by the Trustee or any receiver appointed hereunder) may, but will not be obligated to, make advances to perform the same on Debtor's behalf (after written notice to Debtor if an Event of Default has not occurred), and Debtor hereby agrees to repay such sums and any reasonable attorneys' fees incurred in connection therewith on demand. In addition, Debtor hereby agrees to repay on demand any reasonable out-of-pocket costs, expenses and attorney's fees incurred by Secured Party or the Trustee which are to be obligations of Debtor pursuant to, or allowed by, the terms of this instrument. Such amounts will be in addition to any sum of money which may, pursuant to the terms and conditions of the written instruments comprising part of the Obligations, be due and owing. No such advance will be deemed to relieve Debtor from any default hereunder. 6.3 TERMINATION. If all the Obligations are paid in full, then all of the Collateral will revert to Debtor and the entire estate, right, title and interest of the Trustee and Secured Party will thereupon cease; and the Secured Party in such case shall, upon the request of Debtor and the payment by Debtor of all reasonable out-of-pocket attorneys' fees and other expenses, deliver to Debtor proper instruments acknowledging the release of this instrument and advising purchasers of production who are making payment on the Collateral to Secured Party of the termination of this instrument. 6.4 RENEWALS, AMENDMENTS AND OTHER SECURITY. Secured Party may take or hold other security for the Obligations without notice to or consent of Debtor. The acceptance of this instrument by Secured Party shall not waive or impair any other security Secured Party may have or hereafter acquire to secure the payment of the Obligations nor shall the taking of any such additional security waive or impair the lien and security interests herein granted. The Trustee or Secured Party may resort first to such other security or any part thereof, or first to the security herein given or any part thereof, or from time to time to either or both, even to the partial or complete abandonment of either security, and such action will not be a waiver of any rights conferred by this instrument. This instrument may not be amended, waived or modified except in a written instrument executed by both Debtor and Secured Party. 6.5 ASSIGNMENT AND FINANCING STATEMENT. This instrument will be deemed to be and may be enforced from time to time as an assignment, chattel mortgage, contract, deed of trust, financing statement, real estate mortgage, or security agreement, and from time to time as any one or more thereof if appropriate under applicable state law. As a financing statement this instrument is intended to cover all Personalty Collateral including, but not limited to, Fixture Collateral. This instrument shall be filed in the appropriate records of the county or counties and the state in which the Realty Collateral is located as well as the Uniform Commercial Code records of the Secretary of State or other appropriate office of the state in which any Personalty Collateral or any Realty Collateral is located. At Secured Party's 13 request Debtor shall execute financing statements covering the Personalty Collateral, including but not limited to all Fixture Collateral, which financing statements may be filed in the Uniform Commercial Code records of the Secretary of State or other appropriate office of the state in which any of the Collateral is located. 6,6 UNENFORCEABLE OR INAPPLICABLE PROVISIONS. If any provisions hereof is invalid or unenforceable, the other provisions hereof will remain in full force and effect in order to carry out the provisions hereof. 6.7 RIGHTS COMULATIVE. Each and every right, power and remedy herein given to the Trustee or Secured Party will be cumulative and not exclusive, and each and every right, power and remedy whether specifically herein given or otherwise existing may be exercised from time to time and as often and in such order as may be deemed expedient by the Trustee, or the Secured Party, as the case may be, and the exercise, or the beginning of the exercise, of any such right, power or remedy will not be deemed a waiver of the right to exercise, at the same time of thereafter, any other right, power or remedy. No delay or omission by the Trustee or by Secured Party in the exercise of any right, power or remedy will impair any such right, power or remedy or operate as a waiver thereof or of any other right, power or remedy then or thereafter existing. 6.8 WAIVER BY SECURED PARTY. Any and all covenants in this instrument may from time to time by instrument in writing by the Secured Party, be waived to such extent and in such manner as the Trustee or Secured Party may desire, but no such waiver will ever affect or impair either the Trustee's or Secured Party's rights hereunder, except to the extent specifically stated in such written instrument. 6.9 TERMS. This instrument is binding upon Debtor, Debtor's successors and assigns, and will inure to the benefit of the Trustee and the Trustee's successors and Secured Party and its successors and permitted assigns. Unless the context otherwise requires, terms used in this instrument which are defined in the Uniform Commercial Code of Texas are used with the meanings therein defined. 6.10 COUNTERPARTS. This instrument may be executed in any number of counterparts, each of which will for all purposes be deemed to be an original, and all of which are identical except that, to facilitate recordation, in any particular counterpart portions of Exhibit "A" hereto which describe properties situated in Counties other than the County in which such counterpart is to be recorded may have been omitted. 6.11 GOVERNING LAW. This instrument shall be governed by, and construed in accordance with, the law of the State of Texas (except that Tex. Rev. Civ. Stat. Ann. art. 5069, Ch. 15 (which regulates certain revolving credit loan accounts and revolving triparty accounts is hereby waived and shall not apply to this instrument) subject, however, to the effect of applicable federal law. 6.12 NOTICE. All notices required or permitted to be given by Debtor, Secured Party or the Trustee shall be made in accordance with the 14 Notes. Any notices to be given to the Trustee shall be delivered to Secured Party. 6.13 DUTIES OF TRUSTEE. It shall be no part of the duty of the Trustee to see to any recording, filing or registration of this Deed of Trust or any other instrument in addition or supplemental hereto, or to see to the payment of or be under any duty with respect to any tax or assessment or other governmental charge which may be levied or assessed on the Collateral, any part thereof, or against the Debtor, or to see to the performance or observance by the Debtor of any of the covenants and agreements contained herein. Trustee shall not be responsible for the execution, acknowledgment or validity of this Deed of Trust or of any instrument in addition or supplemental hereto or for the sufficiency of the security purported to be created hereby, and makes no representation in respect thereof or in respect of the rights of the Secured Party. Trustee shall have the right to consult with counsel regarding any matters arising hereunder and shall be fully protected in relying as to legal matters on the advice of counsel. Trustee shall not incur any personal liability hereunder except for his own negligence or willful misconduct; and the Trustee shall have the right to rely on the authenticity any instrument, document or signature authorizing or supporting any action taken or proposed to be taken by him hereunder, believed by him in good faith to be genuine. EXECUTED this 27th day of March, 1995. DEBTOR: URI, INC. By: Paul K. Willmott Name: Paul K. Willmott Title: President THE STATE OF COLORADO COUNTY OF DENVER This instrument was acknowledged before me on March 27, 1995, by Paul K. Willmott, President, of URI, Inc., a corporation on behalf of said corporation. (seal) Jennie Davis Notary Public - State of Colorado My Commission Expires: Jennie Davis My Commission Expires January 9, 1998 Printed Name of Notary Public 15 EXHIBIT A TO THE DEED OF TRUST, SECURITY AGREEMENT AND FINANCING STATEMENT FROM URI, INC. TO CHARLEY GEORGE MAYS, TRUSTEE, FOR THE BENEFIT OF WALLACE M. MAYS MINING LEASES - KLEBERG COUNTY, TEXAS 1. KD-1A, B & C - In Situ Mining Leases between Clyde M. Allen, Jr., Joyce Allen Baker, Jane Allen Lamb and URI, dated 5-28-89, covering 40 acres of land, more or less, being Farm Lot 1, Block 47 of the Kleberg Town and Improvement Company Subdivision, Kleberg County, Texas. Received by Warranty Deed from O. G. Pirie recorded in Vol. 12, Page 164 in the Kleberg County Courthouse, Kleberg County, Texas, said Lease being recorded in the Kleberg County, Texas Clerk and Recorder's Office at Volume 22, Page 983. 2. KD-2A - Solution Mining Lease between B. B. Braly and Exxon Corp., dated 5-29-79, covering 40 acres of land, more or less, being Farm Lot 13 in Block 50 of The Kleberg Town and Improvement Company Subdivision, as per map or plat thereof recorded in Vol. 1, Page 34, Plat Records of Kleberg County, Texas, said Lease being recorded in the Kleberg County, Texas Clerk and Recorder's Office at Vol. 362, Page 281. Partial release being recorded at Vol. 23, Page 330. 3. KD-2B - Solution Mining Lease between Iva Juanita Cumberland Burris, individually and as independent executrix of the estate of William Arthur Cumberland, and Exxon Corp., dated 5-29-79, covering 120 acres of land, more or less, being Farm Lots No. 13 in Block 50, and Farm Lots Nos. 7 and 8 in Block 54 of The Kleberg Town and Improvement Company Subdivision, as per map or plat thereof recorded in Vol. 1, page 34, Plat Records of Kleberg County, Texas, said Lease being recorded in the Kleberg County, Texas Clerk and Recorder's Office at Vol. 362, Page 294. Partial release being recorded at Vol. 23, Page 332. 4. KD-2C - In Situ Mining Lease between Sharon C. and Johnny Lee Robertson and URI, dated 11-23-83, covering 5 acres of land, more or less, being 466.67 feet square located in the SW corner of Farm Lot 13, Block 50 of The Kleberg Town and Improvement Company Subdivision, Kleberg County, Texas. Recorded in Vol. 336, Page 62, Deed Records of Kleberg County, Texas, said Lease being recorded in the Kleberg County, Texas Clerk and Recorder's Office at Volume 442, Page 235. 5. KD-5 - 40 acre Lease dropped September 8, 1988. 6. KD-6A - Mining Lease between J. Eugene Wukasch, Earl O. Wukasch and Exxon Corp., dated 7-22-81, covering 34.30 acres, more or less, being the South 34.30 acres of Farm Lot No. 7 in Block 48 of the Kleberg Town and Improvement Company Subdivision, as per map or plat thereof recorded in Vol. 1, Page 34, Plat Records of Kleberg County, Texas, said Lease being recorded in the Kleberg County, Texas Clerk and Recorder's Office at Vol. 403, Page 230. 16 7. KD-6B - Mining Lease between Clara Kissman and Exxon Corp., dated 3-5-81, covering 34.30 acres, more or less, being the South 34.30 acres of Farm Lot No. 7 in Block 48 of the Kleberg Town and Improvement Company Subdivision, as per map or plat thereof recorded in Vol. 1, Page 34, Plat Records of Kleberg County, Texas, said Lease being recorded in the Kleberg County, Texas Clerk and Recorder's Office at Vol. 395, Page 246. 8. KD-8 - Solution Mining Lease between George L. Chamberlin and Exxon Corp., dated 6-5-79, covering 40 acres of land, more or less, being Farm Lot 2 in Block 54 of The Kleberg Town and Improvement Company subdivision, as per map or plat thereof recorded in Vol. 1, Page 34, Plat Records of Kleberg County, Texas, said Lease being recorded in the Kleberg County, Texas Clerk and Recorder's Office at Vol. 362, Page 300. 9. KD-9 - Uranium Mineral Lease between Kenneth A. Huff, et al. and URI, dated 8-2-83, covering approximately 120 acres of land being Farm Lots 9, 10, and 11, of Block 49 of The Kleberg Town and Improvement Company Subdivision as per map or plat thereof recorded in Volume 1, Page 34, Plat Records of Kleberg County, Texas, said Lease being recorded in the Kleberg County, Texas Clerk and Recorder's Office at Vol. 439, Page 103. 10. KD-10 - Mining Lease between Blanch C. Daughters, individually and as independent executrix of the estate of Harley L. Daughters and Exxon Corp., dated 12-10-80, covering 160.0 acres of land, more or less, being Farm Lots Nos. 3, 4, 5 and 6 in Block 54 of The Kleberg Town and Improvement Company Subdivision, as per map or plat thereof recorded in Vol. 1, Page 34, Plat Records of Kleberg County, Texas, said Lease being recorded in the Kleberg County, Texas Clerk and Recorder's Office at Vol. 390, Page 156. 11. KD-11 - Solution Mining Lease between Melvin E. and Zeffie L. Burris and Exxon Corp., dated 4-26-79, covering 40 acres of land, more or less, being Farm Lot No. 1 in Block 54 of The Kleberg Town and Improvement Company Subdivision, as per map or plat thereof recorded in Vol. 1, Page 34, Plat Records of Kleberg County, Texas, said Lease being recorded in the Kleberg County, Texas Clerk and Recorder's Office at Vol. 362, Page 287. 12. KD-12 - Mining Lease between R. K. Cumberland, et al. and Exxon Corp., dated 12-9-80, covering 160.0 acres of land, more or less, being Farm Lots 3, 4, 5, 6, of Block 48 of The Kleberg Town and Improvement Company Subdivision, as per map or plat thereof recorded in Vol. 1, page 34, Plat Records of Kleberg County, Texas, said Lease being recorded in the Kleberg County, Texas Clerk and Recorder's Office at Vol. 390, Page 153. 13. KD-13A, B, & C - Solution Mining Lease between William F. Radford, Jane Frances Radford and Exxon Corp., dated 5-16-79, covering 674 acres of land, more or less, and being Farm Lots Nos. 1 through 17 in Block 55, and Farm Lot No. 13 in Block 49 of The Kleberg Town and Improvement Company Subdivision, as per map or plat thereof recorded in Vol. 1, Page 34, Plat Records of Kleberg County, Texas, said Lease being recorded in the Kleberg County, Texas Clerk and Recorder's Office at Vol. 362, Page 307. 14. KD-14 - Solution Mining Lease between William F. Radford, Jane Frances Radford and Exxon Corp., dated 5-16-79, covering 240 acres of land, more or 17 less, and being Farm Lots Nos. 9 and 10 in Block 48, and Farm Lots Nos. 12, 14, 15 and 16 in Block 49 of The Kleberg Town and Improvement Company Subdivision, as per map or plat thereof recorded in Vol. 1, Page 34, Plat Records of Kleberg County, Texas, said Lease being recorded in the Kleberg County, Texas Clerk and Recorder's Office at Vol. 362, Page 313. 15. KD-15 A & B - Mining Leases between Eleanor Davis, Catherine Veselik, Bonaventure H. Veselik and Exxon Corp., dated 12-11- 80, covering 40.0 acres, more or less, being Farm Lot 5 in Block 49 of The Kleberg Town and Improvement Company Subdivision, as per map or plat thereof recorded in Vol 1, Page 34, Plat Records of Kleberg County, Texas, said Leases being recorded in the Kleberg County, Texas Clerk and Recorder's Office at Vol. 390, Page 236 (15B) and Vol. 436, Page 238 (15A). 16. KD 16A & B - In-Situ Uranium Mining Lease dated 12-26-89 between Charles W. Muil, Jr. and Robert D. Muil and URI, Inc. covering 840.0 acres, being Farm Lots 9 through 16, Blk. 53, Lots 9, 13 thru 16, Blk. 54, Lots 1 thru 4, Blk. 63 and Lots 1 thru 4, Blk. 64, Kleberg Town and Improvement Company Subdivision as per map or plat thereof recorded in Vol. 1, Page 34, Plat Records of Kleberg County, Texas and which lease is recorded in Vol. 31, at Page 611 of the Official Records of Kleberg County, Texas. 17. KD-17 - In-Situ Uranium Mining Lease between Harold J. and Era Mae Bareis and URI dated 12-9-86, covering the South 8 acres of Farm Lot 4, Block 26; the north 8 acres of Farm Lot 2, Block 27; Farm Lot 13, Block 27; Farm Lots 8 and 16, Block 28; Farm Lots 4, 5 and the North Half of 6, Block 38 comprising 236.0 acres of land, more or less, all located in The Kleberg Town and Improvement Company Subdivision, as per map or plat thereof recorded in Vol. 1, Page 34, Plat Records, Kleberg County, Texas, said Lease being recorded in the Kleberg County, Texas Clerk and Recorder's Office at Vol. 508, Page 286. 18. 18-A-AK - Solution Mining Leases between the following listed lessors:
LSE_# LESSOR LSE DATE VOL/BOOK PAGE KD18A Barbara J. Keltner 01/18/88 12 355 KD18AA Ruby Steward 01/18/88 12 605 KD18AB Robert Giese 01/18/88 12 615 KD18AC Kenneth Giese 01/18/88 12 625 KD18AD Victor E. Henry 01/18/88 12 635 KD18AE Mary M. Golden 01/18/88 12 645 KD18AF Lera C. Hosmer 01/18/88 12 655 KD18AG Edna Stewart 01/18/88 12 665 KD18AH James C. Golden 01/18/88 12 675 KD18AI Vera Betty Damon 09/20/89 28 300 KD18AJ William T. Henry 10/10/89 29 300 KD18AK Eugene W. Henry 10/12/89 29 581 KD18B Ada Fischer Estate 01/18/88 12 365 KD18C Ada Fischer Life Est. 01/18/88 12 375 KD18D Patricia Fischer 01/18/88 12 385 KD18E Jeanette Odom 01/18/88 12 345 KD18F Jean Greeson 01/18/88 12 395 KD18G Freda Marks 01/18/88 12 405 KD18H Gerald Fischer 01/18/88 12 415
18 KD18I Mary Waters 01/18/88 12 425 KD18J Herman Hollingsworth 01/18/88 12 435 KD18K Catherine Veselik 01/18/88 12 445 KD18L Betty Lou Fisher 01/18/88 12 455 KD18M Frank Fisher 01/18/88 12 465 KD18N Bernard Wallace 01/18/88 12 475 KD18O Alice Tiberio 01/18/88 12 485 KD18P Louise Sparks 01/18/88 12 495 KD18Q Helen G. McKinney 01/18/88 12 505 KD18R William H. White 01/18/88 12 515 KD18S Virginia J. Henry 01/18/88 12 525 KD18T Delores Wright 01/18/88 12 535 KD18U Earl Hollingsworth 01/18/88 12 545 KD18V Helen Reeder 01/18/88 12 555 KD18W Lewis W. Maples Estate, 01/18/88 12 565 KD18X Voncille Hering 01/18/88 12 575 KD18Y Virginia H. Hopper 01/18/88 12 585 KD18Z Eleanor M. Davis 01/18/88 12 595
and URI, Inc. dated as shown above, covering 200 acres of land, more or less, being Farm Lots 3, 4, 6, 7, & 8, Blk. 49 of the Kleberg Town and Improvement Company Subdivision, as per map or plat thereof recorded in Vol. 1, Page 34, Plat Records of Kleberg County, Texas, said leases being recorded in the Kleberg County, Texas Clerk and Recorder's office at the Volumes and Pages listed above. 19. KD-19 - Solution Mining Lease between Robert S. Sexauer and wife Jacqualine N. Sexauer Trust and URI, Inc. dated March 17, 1989, covering 160 acres of land, more or less, being Farm Lots 11-14 inclusive, Blk. 41 of the Kleberg Town and Improvement Company Subdivision, as per map or plat thereof recorded in Vol. 1, Page 34, Plat Records of Kleberg County, Texas, said lease being recorded in the Kleberg County, Texas Clerk and Recorder's office at Vol. 21, Page 443. 20. KD-20A-F - Solution Mining Lease between the following listed lessors:
LSE # LESSOR LSE DATE VOL/BOOK PAGE KD20A & B Y. G. Garcia 02/15/89 20 389 KD20C Zulema G. Martinez 02/15/89 20 389 KD20D Fidel Garcia, etux 02/15/89 20 389 KD20E Ofelia Garcia 02/15/89 20 389 KD20F Hermila Garcia 02/15/89 20 389
and URI, Inc. dated as shown above, covering 200 acres of land, more or less, being Farm Lots 2, 6, 7, 8 & 10, Block 42 of the Kleberg Town and Improvement Company Subdivision, as per map or plat thereof recorded in Vol. 1, Page 34, Plat Records of Kleberg County, Texas, said leases being recorded in the Kleberg County, Texas Clerk and Recorder's office at the Volumes and Pages listed above. 19 21. KD-21A-F - Solution Mining Leases between the following listed lessors:
LSE # LESSOR LSE DATE VOL/BOOK PAGE KD21A Arnoldo A. Adame, etux 02/15/89 21 454 KD21B Edna A. Rios, a widow 02/15/89 21 454 KD21C Santana L. Adame, Jr. 02/15/89 21 454 KD21D Eliza A. Lopez, a widow 02/15/89 21 454 KD21E Elvira A. Leyba, etvir 02/15/89 21 454 KD21F Arnoldo A. Adame, Admin. 02/15/89 21 454
and URI, Inc. dated as shown above, covering 40 acres of land, more or less, being Farm Lot 16, Block 42 of the Kleberg Town and Improvement Company Subdivision, as per map or plat thereof recorded in Vol. 1, Page 34, Plat Records of Kleberg County, Texas, said leases being recorded in the Kleberg County, Texas Clerk and Recorder's office at the Volumes and Pages listed above. 22. KD22-A-K - Solution Mining Leases between the following listed lessors:
LSE # LESSOR LSE DATE VOL/BOOK PAGE KD22A Jo Ann Hansen 04/10/89 21 919 KD22B Marqueeta Seagraves 04/10/89 22 30 KD22C Mary L. Simms Trust 04/10/89 23 83 KD22D Ruth Brown 04/01/89 23 93 KD22E Mark Hansen 04/10/89 23 106 KD22F Cara Sims 04/20/89 23 400 KD22G George C. Darr, Est. 04/20/89 23 390 KD22H Elouise McLaughlin 04/10/89 23 344 KD22I Mary Lou Olson 04/15/89 23 334 KD22J Wilelyn Stapper 04/15/89 23 617 KD22K Winifred Kellogg 04/09/89 23 769
and URI, Inc. dated as shown above, covering 120 acres of land, more or less, being Farm Lot 11, 14 and 15, Block 42 of the Kleberg Town and Improvement Company Subdivision, as per map or plat thereof recorded in Vol. 1, Page 34, Plat Records of Kleberg County, Texas, said leases being recorded in the Kleberg County, Texas Clerk and Recorder's office at the Volumes and Pages listed above. 23. KD-23 FEE Ownership - Surface and 165/168ths mineral ownership in 50 acres, and 100% mineral ownership in 110.0 acres covering Farm lots 9, 10, 15, 16, Blk. 41, and 100% mineral ownership in 125.7 acres covering Farm Lots 1, 2, 8 and the North 5.7 acres of Farm Lot 7 all in Blk. 48, of the Kleberg Town and Improvement Company Subdivision, as per map or plat thereof recorded in Vol. 1, Page 34, Plat Records of Kleberg County, Texas, said Warranty Deed being recorded in Vol. 35 at Page 665 of the Official Records, Kleberg County, Texas being 285.7 acres, more or less, all total, dated April 4, 1990. MINING LEASES - DUVAL COUNTY, TEXAS 1. RO-1 - In-Situ Uranium Mining Lease between Jose and Laura T. Cardenas and URI, dated 9-5-85, covering 372.00 acres of land, more or less, and being described as Tract (a) of First Tract containing 138.0 acres, more or less, situated in the Tiburcio Perez Survey, Abstract No. 1541, Survey No. 16 and Tract (b) of First Tract containing 234.0 acres, more or less, situated in the H & G N R.R. Survey No. 15, Abstract No. 316, in that certain Partition Deed 20 between William L. Rogers, Jr., et al., said deed dated July ___, 1944 and recorded in Volume 57, Page 315 et seq., Deed Records, Duval County, Texas, said Lease being recorded in the Duval County, Texas Clerk and Recorder's Office at Book 405, Page 317. 2. RO-2 - In-Situ Uranium Mining Lease between Guadalupe Garcia, et al. and URI, dated 9-5-85, covering 150.00 acres of land, more or less, out of and part of the Julia Rogers Survey No. 16, Abstract No. 1541 and being the same land as is described in Deed dated February 5, 1976, from Consuelo Garcia to Guadalupe Garcia and Romeo Garcia, recorded in Volume 203, Page 86, Deed Records, Duval County, Texas, said Lease being recorded in the Duval County, Texas Clerk and Recorder's Office at Book 406, page 431. 3. RO-3 - In-Situ Uranium Mining Lease between Hugo and Laura G. Berlanga and URI, dated 11-27-85, covering Tract No. 1, 18.44 acres of land, more or less, being known as Share No. 4, set aside to Martin Rangel; and Tract No. 2, 18.44 acres of land, more or less, being known as Share No. 9, set aside to Jose Rangel, both Tracts being out of the Ursino Rangel Homestead Survey 6, Abstract No. 486, patent No. 500, containing 165.95 acres of land, divided as set forth in Partition Deed dated December 9, 1929, recorded in Volume 38, Page 494, Deed Records, Duval County, Texas, and more particularly described by metes and bounds in Warranty Deed dated May 20, 1977 recorded in Volume 213, Page 31, Duval County, Texas, said Lease being recorded in the Duval County, Texas Clerk and Recorder's Office at Book 410, Page 337. 4. RO-4 - In-Situ Mining Lease between Julia R. Flores and URI, dated 12-16-85, covering 502.00 acres of land, more or less, being Tract (a) 366.0 acres being a part of the H & G N R.R. Co. Survey No. 15, Abstract No. 316 and Tract (b) 136.0 acres being part of the J. Poitevent Survey No. 21, Abstract No. 467 and being Share 6(b) set aside to Julia R. Flores in that certain Partition Deed dated July ____, 1944, recorded in Volume 57, Page 315, Deed Records, Duval County, Texas, said Lease being recorded in the Duval County, Texas Clerk and Recorder's Office at Book 411, Page 343. 5. RO-5 - In-Situ Uranium Mining Lease between Manuel G. and Francisca R. Rogers and URI, dated 1-15-86, covering 202.00 acres, more or less, a part of Tiburcio Perez Survey Abst. 1541 and being all of "Third Tract" containing 502 acres, more or less, between William L. Rogers, et al., and awarded to Manual G. Rogers, dated July ___, 1944 and recorded in Vol 57, Page 315, Deed Records, Duval County, Texas SAVE & EXCEPT from said 502 acres, the south 200 acres, more or less, deeded from Manuel G. Rogers, et ux to Alfredo Garcia, et al. dated March 23, 1946, recorded in Vol 63, page 534, Deed Records, Duval County, Texas, and ALSO SAVE AND EXCEPT the west 100 acres, more or less, of the north 302 acres of said 502 acre tract, deeded from Manuel G. Rogers, et ux to Alfredo Garcia, et al., dated October 15, 1946, recorded in Vol 65, Page 248, Deed Records, Duval County, Texas, said Lease being recorded in the Duval County, Texas Clerk and Recorder's Office at Book 1, Page 214. 6. RO-6 - In-Situ Uranium Mining Lease between Gertrudes R. Tanguma and URI, dated 6-25-86, covering Share No. 7, containing 70.05 acres of land out of the 409.30 acres of land and out of the J. Poitevent Survey 529, Abst. 474, and the Gabriel Rangel Homestead Survey No. 5, Abst. 487, in the "Los Reyes" area in Duval County, Texas, and also being out of Shares 5 and 6 of the Partition of the Macedonio Rangel Lands, recorded in Vol 8, Pages 331/335, 21 said Share No. 7 is more particularly described by metes and bounds in Partition Deed dated April 29, 1973 recorded in Vol. 176, Pages 327/337, Deed Records of Duval County, Texas, said Lease being recorded in the Duval County, Texas Clerk and Recorder's Office at Book 11, Page 699. 7. RO-7 - In-Situ Uranium Mining Lease between Concepcion R. Sendejo and URI, dated 10-26-86, covering Share No. 6, containing 60.05 acres of land out of the 409.30 acres of land and out of the J. Poitevent Survey 529, Abst. 474, and the Gabriel Rangel Homestead Survey No. 5, Abst. 487, in the "Los Reyes" area in Duval County, Texas, and also being out of Share No. 5 and 6 of the Partition of the Macedonio Rangel Lands, recorded in Vol. 8, Pages 331/335, said Share No. 6 is more particularly described by metes and bounds in Partition Deed dated April 29, 1973 recorded in Vol. 176, Pages 327/337, Deed Records, Duval County, Texas, said Lease being recorded in the Duval County, Texas Clerk and Recorder's Office at Book 19, Page 220. 8. RO-8 - In-Situ Uranium Mining Lease between Herminia R. Gonzales and URI, dated 10-30-86, covering Share No. 5, containing 60.05 acres of land, more or less, out of 409.30 acres of land and out of the J. Poitevent Survey 529, Abst. 474, and the Gabriel Rangel Homestead Survey No. 5, Abst. 487, in the "Los Reyes" area in Duval County, Texas, and also being out of Share No. 5 and 6 of the Partition of the Macedonio Rangel Lands, recorded in Vol. 8, Pages 331/335, said Share No. 6 is more particularly described by metes and bounds in Partition Deed dated April 29, 1973 recorded in Vol. 76, Pages 327/337, Deed Records, Duval County, Texas, said Lease being recorded in the Duval County, Texas Clerk and Recorder's Office at Book 19, page 404. 9. RO-9 - In-Situ Uranium Mining Lease between Trinidad B. and Reymundo R. Rangel and URI, dated 12-4-86 covering Share No. 2, containing 62.05 acres of land, more or less, allotted and set aside to Reymundo R. Rangel, and the West 35.0 acres of land, more or less, out of Share No. 4, containing 70.05 acres, allotted and set aside to Maria R. Serna, et vir, out of the 409.30 acres of land out of the J. Poitevent Survey No. 5, Abst. 474 and the Gabriel Rangel Homestead Survey No. 5, Abst. 487, in the "Los Reyes" area in Duval County, Texas, and more particularly described by metes and bounds in Partition Deed made by and between Candelario R. Rangel, et al., the 29th day of April, 1973 recorded in Vol. 176, Pages 327/341, Deed Records, Duval County, Texas, and also being out of Shares 5 and 6 of the Partition of the Macedonio Rangel Lands recorded in Vol. 8, Pages 331/333, Deed Records of Duval County, Texas, said Lease being recorded in the Duval County, Texas Clerk and Recorder's Office at Book 23, Page 200. 10. RO-10 - In-Situ Uranuim Mining Lease between Lucila S. Sanchez, et al., and URI, dated 12-8-86, covering Share No. 4, containing 70.05 acres of land, more or less, allotted and set aside to Maria R. Serna, et vir, out of the 409.30 acres of land out of the J. Poitevent Survey 529, Abst. 474 and the Gabriel Rangel Homestead Survey No. 5, Abst. 487, in the "Los Reyes" area in Duval County, Texas, and also being out of Share No. 5 and 6 of the Partition of the Macedonio Rangel Lands recorded in Vol 8, Pages 331/335, Deed Records of Duval County, Texas, more particularly described by metes and bounds in Partition Deed made by and between Candelario R. Rangel, et al., the 29th day of April, 1973, recorded in Vol 176, Pages 327/341, Deed Records, Duval County, Texas, said Lease being recorded in the Duval County, Texas Clerk and Recorder's Office at Book 23, Page 190. 22 11. RO-11 - In-Situ Uranium Mining Lease between Homero and Clemencia Contreras and URI, dated 1-19-87, covering Sixteen acres of land, more or less, out of a 160 acre tract, originally patented to Antonio Rangel on July 19, 1877, Patent No. 162, Vol. 6, of the State of Texas, and being the same property conveyed to Donaciano Contreras by Felix Trejo dated March 31, 1920, of record in Vol. 18, Page 129, Deed Records, Duval County, Texas, and two acres of land, more or less, out of a 160 acres tract, known as Survey No. 7, originally a Homestead Certificate issued to Antonio Rangel, patented by the State of Texas on September 24, 1877, Patent No. 162, Vol. 6 of Record in Vol. B, Page 126, Deed Records, Duval County, Texas, and being the same property conveyed to Donaciano Contreras by Antonio Cantu de Perez, dated November 28, 1922, of Record in Vol. 21, Page 591, Deed Records, Duval County, Texas, said Lease being recorded in the Duval County, Texas Clerk and Recorder's Office at Book 29, Page 741. 12. RO-12 - In-Situ Uranium Mining Lease between, Thomas W. Crews, et ux and URI, Inc., dated August 27, 1987, covering 1,965.7 acres of land, more or less, out of Survey 17, Abstr. 314, Survey 18, Abstr. 1781 and Survey 274, Abstr. 1780, which lease is covered by a Memorandum of Uranium Mining Lease and Letter Agreement dated September 24, 1987 in Vol. 38, Page 3, and by Memorandum of Amendment to Mining Lease and Letter Agreement dated December 15, 1988 in Vol. 65 at Page 669 of the Official Records, Duval County, Texas. 23 MINING LEASES - VASQUEZ - DUVAL COUNTY, TEXAS 1. VA-1A, B, C - In-Situ Uranium Mining Lease between Romeo J. Vasquez, et al and URI, Inc. dated February 12, 1990, covering 341.66 acres of land, more or less, described as Share 4, set apart to Margarita T. De Vella Cuellar and husband, Juan Vela Cuellar in Partition Deed between Aristeo Trevino, et al, dated 11-07-23 of record in Vol. 24, pp. 15-19, Deed Records of Duval County, Texas, and which lease is recorded in Vol. 46, at Page 156 of the Official records of Duval County, Texas. 2. VA-2A, B, C - In-Situ Uranium Mining Lease between Romeo J. Vasquez, et al, and URI, Inc., dated January 15, 1988, covering 500.0 acres of land, more or less, described as 500 acres of land out of Share No. 2 of the original partition of Santa Maria de los Angeles de Abajo Grant of record in Vol. 46 at Page 156 of the Official Records of Duval County, Texas. 24 EXHIBIT "B" PERMITTED LIENS 1. Liens in favor of Secured Party. 2. Encumbrances consisting of minor easements, zoning restrictions, or other restrictions on the use of real property that do not (individually or in the aggregate) materially affect the value of the assets encumbered thereby or materially impair the ability of Debtor to use such assets in its businesses, and none of which is violated in any material respect by existing or proposed structures or land use. 3. Liens for taxes, assessments, or other governmental charges which are not delinquent or which are being contested in good faith by appropriate proceedings and for which adequate reserves have been established. 4. Liens of mechanics, materialmen, warehousemen, carriers, or other similar statutory liens that are incurred in the ordinary course of business which are not delinquent or which are being contested in good faith by appropriate proceedings and for which appropriate reserves have been established. 5. Liens resulting from good faith deposits (including certificates of deposit) to secure payments of workmen's compensation or other social security programs. 6. Encumbrances disclosed in the title policy covering the Property. 7. Any interest or title of a lessor in property which is the subject of any mineral lease entered into in the ordinary course of business by the Debtor, as lessee, and not prohibited by this Agreement other than any right of such lessor to prohibit the assignment, encumbrance or other disposition of such property. EX-27 5 FINANCIAL DATA SCHEDULE
5 3-MOS DEC-31-1995 MAR-31-1995 43,468 562,341 80,368 0 3,426,067 4,460,679 54,169,445 16,420,512 42,300,103 9,686,399 1,345,507 8,237 0 0 26,603,050 42,300,103 1,251,013 1,251,013 2,979,815 3,623,709 0 0 154,980 (2,479,443) (495,000) (1,984,443) 0 0 0 (1,984,443) (.25) (.25)
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