Copy Lease of Coal Mines.

, made the twentieth day of May, one thousand eight hundred and seventy-four, between William Aitchison, of North Molyneux district, in the Province of Otago, and Colony of New Zealand, settler, hereinafter called the Lessor of the one part, and The Kaitangata Coal-Mining Company (Registered), hereinafter called the Lessees of the other part: Witnesseth that the lessor doth hereby demise unto the lessees, their successors, and assigns, All and Singular the coal mines, beds, or seams of coal, situate and lying at, upon, and underneath that section or parcel of land containing by admeasurement fifty-five acres, more or less, being section numbered four, block three, North Molyneux district, in the said Province, as the said section is delineated on the plan in the margin hereof, and colored red; Excepting however, that portion of the said land which, with its admeasurements and abuttals, is shewn on the said plan, and colored yellow, being land already conveyed to one Charles Taylor: And Also full and free liberty, license, power, and authority to dig, sink, work, drive, and make such mines, cuttings, quarries, pits, shafts, adits, trenches, soughs, drifts, leats, and water-gates as the lessees, their successors, or assigns shall think proper, in and upon any part or parts of the said section of land for the procuring of coal in or from the said beds, or seams of coal, or any of them, and for avoiding and carrying off water, foul airs, and slyth therefrom : And Also to make use of such ground room, heap room, and pit room as shall be necessary for laying the coal that shall from time to time be got out of such pits, or the stones, gravel, earth, and other refuse and rubbish which shall from time to time be brought to the surface in the course of working the said beds or seams of coal: And Also, to take, lead, and carry away with carts, waggons, and other carriages all the coal raised and got out of the said mines through, over, and along all or any part of the said section of land the most convenient way or ways, to any place or places, where the same shall be delivered: And Also, in and upon the said land to make, fix, or place any roads, ways, or bridges as occasion shall require: And Also, in and upon such part of the said section of page 6 land, not exceeding in admeasurement two acres, as the lessees, their successors, or assigns, shall, within six months from the date hereof, select to make, set up, and build, and also to pull down and re-erect all such fire and other engine-houses, stables, dwelling-houses, cabins, huts, sheds, walls, jetties, and other erections as shall from time to time be necessary or convenient for the working all or any of the said beds or seams of coal, or for getting or procuring the coal therein or therefrom, or for converting the same in any manner for use, or for laying up or stacking the same, or for more effectually exercising all, or any of the liberties, powers, and authorities hereinbefore granted : And Also, for the purpose of making any such roads, bridges, engine-houses, stables, dwelling-houses, cabins, huts, sheds, jetties, walls, and other erections as aforesaid, to dig, take, and lead away any stone or other materials convenient or suitable for those purposes; together with full power, license, and authority to cut down, remove, and carry away all such timber for firewood, or for the necessary purposes of the mines, from any part of the said section of land as may be necessary for the proper working of the said mines and for domestic use by the miners, and also for building such houses, huts, bridges, jetties, or sheds, as aforesaid, upon the land; together with the use of all waters and watercourses arising or running within the said section of land, with liberty to divert and turn such waters and water-courses, and to cut or place any leats, channels, or races, for conducting or conveying the same in through or over any part or parts of the said land for the purpose of more effectually exercising and enjoying the liberties, powers, and authorities hereby granted; Excepting, always, and reserving unto the lessor, his heirs, and assigns, or other the tenant or tenants, occupier or occupiers, for the time being, of the said section of land, and their workmen and servants, free liberty and authority, with or without horses, cattle, carts, waggons, and other carriages to pass, and go along, upon, and across the roads, waggonways, or tramways, bridges, and jetties which may be constructed on the said parcel of land, or in connection therewith, at such time or times as he or they shall think proper, he or they doing or causing no injury nor obstruction to the property or works of the lessees, their successors, or assigns. And Also, excepting and reserving unto the lessor, his heirs or assigns, and his or their agents, workmen or servants, free liberty and authority at all convenient times to enter upon the said mines and premises, and to view the state thereof, and to inspect, examine, and measure the said mines, pits, shafts, or seams and premises, and to use the tackle, ropes, and other conveniences within or upon the said mines, pits, shafts or jetties, or belonging thereto, as often as he or they shall think proper for the purposes aforesaid: To Have, Hold, Use, Exercise and page 7 Enjoy the said bods or seams of coal, liberties, licenses, powers, authorities, and All and singular other the premises hereby granted and demised or expressed, and intended so to be unto the lessees, their successors and assings, for and during the term of Eighty-Four Years, computing from the twenty-third day of October, one thousand eight hundred and seventy-two : Yielding And Paying therefor (subject however to the provision for a reservation of royalty next hereinafter contained) during the said term, the yearly rent of one hundred pounds sterling, by equal quarterly payments, on the twenty-third day of January, the twenty-third day of April, the twenty-third day of July, and the twenty-third day of October in each year; Together with a rent, in the nature of a royalty, at the rate of one shilling for every ton of coal mined and carried away during each such quarter of a year, such rent to be ascertained and paid on the days hereinbefore mentioned: Provided however, and it is hereby expressly declared and agreed by and between the said parties hereto, that if the rent ascertained, and paid as for royalty in any quarter of a year, shall exceed the sum of twenty-five pounds, then for such quarter of a year, the annual rent, other than royalty hereinbefore reserved, shall not be payable, it being the true intention of the parties hereto, that the lessor, his heirs or assigns shall in any event receive as and for a minimum rent at the rate of one hundred pounds per annum, whether or not coal may be raised or mined, so that if the royalty shall in any quarter of a year exceed the sum of twenty-five pounds, then the minimum rent shall merge in the royalty, and the said lessor, his heirs or assigns, shall not receive in any one quarter, both rent and royalty together. And the said lessees do hereby, for themselves, their successors and assigns, covenant with the lessor, his heirs and assigns, in manner following, that is to say, that they, the said lessees, their successors and assigns shall and will pay, or cause to be paid, the rent hereinbefore reserved at the times and in the manner hereinbefore mentioned or appointed for the payment thereof; and also all present and future rates, taxes, charges, or assessments, and outgoings whatsoever, payable or chargeable, whether by or on the landlord or tenant, in respect of the said mines and premises hereby demised: And Also shall and will in all cases, pay or cause to be paid, unto the lessor, his heirs or assigns, for the benefit of him and them, and Ms and their tenants respectively, such sum or sums of money as may be agreed upon or (in case of difference or dispute) as shall be determined by arbitration in manner hereinafter mentioned, by way of compensation for any injury or damage which may be done by them or their agents, servants or workmen, to growing crops and artificial grasses and buildings upon the said land: And Also, that it shall and may be lawful for the lessor, his page 8 heirs or assigns, to recover the amount of the compensation agreed upon or awarded by the arbitrators, by distress upon the demised premises in the same manner as the annual rent hereinbefore reserved may be recovered; And Also, shall and will from time to time, and at all times during the term hereby granted, fence and defend with proper and suitable posts, rails, fences, or walls, all pits, shafts, adits, or holes, which shall be made or sunk by them upon the said section of land, or any part thereof; And Also shall and will during the said term, do as little injury or damage as possible to the surface of the said land, or the buildings, walls, fences, or other property thereon, and shall not, nor will injure or endanger the houses or buildings of the lessor, his heirs or assigns, or his or their tenants, by undermining the foundations of the same, or any them: And Also, shall not, nor will during the said term, without the consent in writing of the lessor, his heirs or assigns, first obtained, get, or procure stone or timber from any part of the said section of land, except stone for use on the said land or timber for use in the mines, or for jetties or fences and buildings or for firewood for domestic purposes, nor remove the same from the said land without the like consent. And Also, shall and will before the expiration of the said term, fill up all pits, shafts, and adits, sunk or made by them, unless the lessor, his heirs or assigns, shall be desirous that the same shall be left open, and of such his or their desire, shall give three calendar months previous notice in writing to the said lessees, their successors or assigns; and shall and will, during the whole of the said term, work the mines in a proper manner, according to the rules of good mining, and keep the shafts and mines or drives supported with sufficient and proper supports, and keep all roadways, bridges, jetties, and water-courses in good repair, and keep correct plans of the workings. And Also, shall and will keep a proper book or books with checks, for the entry of all coal mined and removed; and will, on the first day of each month, deliver to the lessor, his heirs or assigns, if he or they shall so require, a full, true, and correct account of the tonnage of all coals mined and removed during the month. And Also, shall permit the lessor, his heirs or assigns, at any time upon demand for that purpose made to inspect the said books, and make copies of or extracts therefrom. And Also, shall and will, at the end or other sooner determination of the said term, peaceably and quietly leave, surrender, yield and give up the demised premises unto the lessor, his heirs or assigns. And Also : shall and will peaceably and quietly permit and suffer the lessor, his heirs or assigns, and his and their agents, servants, or workmen, at all convenient times, to enter upon the demised premises and view the state thereof, and to inspect, examine, and measure the mines, pits, shafts, engines, jetties, and buildings, on the demised premises, or in page 9 connection therewith; and for the purposes aforesaid to use the tackle, ropes, buckets, and other conveniences within the said mines, pits, shafts, or jetties, or belonging thereto, as often as he or they shall think proper. Provided Always : and it is hereby agreed and declared that when and so often as any injury shall have been done by the lessees, their successors or assigns, or their agents, servants, or workmen, to growing crops, artificial grasses, buildings, or fences, as hereinbefore mentioned, the sum or sums of money to be paid as compensation for such injury or damages, shall be ascertained as follows :—that is to say, the said lessor, his heirs or assigns, or agent, shall (either of his own or their own accord, or at the instance and request of any tenant or occupier of the buildings, fences, or property aforesaid, so injured or damaged as aforesaid) by notice in writing to be given to the lessees, their successors or assigns, claim a compensation for such injury or damage; and each of the parties shall within ten days after such notice shall have been delivered, appoint an arbitrator to ascertain the sum or sums to be so paid as a compensation, and if the lessees, their successors or assigns, shall neglect within the said ten days to appoint their arbitrator, then the arbitrator named by the lessor, his heirs or assigns, shall appoint an arbitrator to act for the lessees, their successors or assigns, and the arbitrators so appointed as aforesaid shall appoint a third person to act with them, and the determination of such three persons, or of the majority of them, as to the sum or sums to be so paid as a compensation, shall be binding and conclusive on both the said parties. Provided Also, and it is hereby agreed between the said parties to these presents, that if the lessees, their successors or assigns, shall be desirous of determining the said term of eighty-four years at the end of the first twenty-one years or forty-two years or sixty-three years of the said term, and of such their desire shall deliver to the lessor, his heirs or assigns, or leave at his or their usual place or places of abode not less than six calendar months' notice next before the expiration of such twenty-one, or forty-two, or sixty-three years, and shall pay and discharge all arrears of rent, and perform all and every the covenants and conditions hereinbefore contained, and on their part to be fulfilled, then and in such case at the end of such twenty-one, or forty-two, or sixty-three years, as the case may be, the said term hereby granted shall absolutely cease and determine. And Also, that if the lessees, their successors or assigns, shall be desirous of determining the said term of eighty-four years at any time during the said term, and of such their desire shall deliver to the lessor, his heirs or assigns, or leave at his or their usual place or places of abode not less than six calendar months' notice before such determination shall take place, and shall pay and discharge all arrears of rent, and perform page 10 and fulfil all and every the covenants and conditions hereinbefore contained, and on their part to be performed and fulfilled, and shall pay to the lessor, his heirs, or assigns, a sum of five hundred pounds sterling as compensation, then, and in such case at the end of six months from the time when such notice shall have been delivered or left as aforesaid the said term of eighty-four years hereby granted shall absolutely cease and determine. And the lessor doth hereby for himself, his heirs, executors, and administrators, covenant with the lessees, their successors, and assigns, that the lessor, his heirs, or assigns, and his and their tenant or tenants, occupier or occupiers, for the time being of the land hereby demised, shall not, nor will, during the term of this demise, cut down any timber on any part of the said section of land except for mining, agricultural, or domestic purposes, nor remove the same from the said land: Provided Always and it is hereby expressly declared and agreed by and between the said parties hereto that the lessees, their successors, or assigns performing the covenants and conditions herein contained may at any time within thirty days after the expiration of this demise, remove the machinery and trade fixtures from the said land. And That if the rent hereby reserved shall be in arrear for twenty-one days after any day whereon the same ought to be paid, or if the lessees, their successors, or assigns shall neglect to work, or shall abandon the said mine for sixty consecutive days, or in case of the breach or non-observance of any of the covenants herein contained, and on the tenant's part to be observed and performed then, and in either of the said events or cases it shall be lawful for the lessor, his heirs, or assigns to re-enter upon the demised premises, and the same to repossess as in his or their former estate, and that without making any formal or other demand of rent, and notwithstanding that no such demand shall have been made, and such reentry shall not release any security current with these presents in the nature of a bond or otherwise. In Witness Whereof these presents have been executed by, or on behalf of, the said parties hereto the day and year first above written.

Signed by the above named William Aitchison, in the presence of

William Aitchison

.

Henry S. Rennert

, Clerk, Balclutha, page 11 The Common Seal of the Kaitangata Coal-mining Company Registered) was hereto affixed by Thomas Thompson Ritchie and Reginald Macdonald, two of the Directors of the said Company, and Robert Grigor, Legal Manager of the said Company, who also signed and delivered these presents as the act and deed of the said Company, in the presence of

L.S.

T.T. Ritchie

, Regd. MacDonald. Directors

Robert Grigor

, Legal Manager.

Henry S. Rennert

, Clerk, Balclutha.