NOTE 5 ? COMMITMENTS AND CONTINGENCIES On June 15, 2009 the Company leased two mining claims in Esmerelda County, Nevada, in the Dunfee Mine Area. The lease includes all additional claims within one mile of these claims. The area was the subject of a geological report on September 11, 2009. The term of the lease is for 20 years and renewable for additional 20 years assuming all conditions of the lease are met. The lease required an initial payment of $5,000, plus $275 Federal and State maintenance fees. Minimum annual payments are required, beginning with $5,000 down payment at the execution of the lease agreement, $5,000 on or before the first anniversary year, $10,000 on or before the second and third anniversaries years, $25,000 on or before the fourth anniversary year, and $75,000 at the fifth anniversary and subsequent years which are subject to increase or decrease equivalent to the rate of inflation designated by the Consumer Price Index for that year. The Company is responsible for taxes and maintenance fees imposed on the claims. The lease grants the Company the right to purchase 2 percent of the royalty on the claims for $5,000,000, reduced by minimum payments made. Lessor is entitled to a royalty of one percent of net smelter returns. The Company has failed to make lease payments; however, the agreement is deemed enforceable as neither party has terminated the lease as of July 31, 2013.