Siberian Tiger/Forests Report

*********************************************************************

Forwarding this press release from the Investigative Network. Please email responses to Heena Patel at Investigative Network, hpatel@igc.apc.org">

Thanks

LEADERS OF U.S.-RUSSIAN SUMMIT AND UN ENVIRONMENTAL BODY CHALLENGED BY ENVIRONMENTALISTS TO SAVE WORLD'S LARGEST FOREST AND SIBERIAN TIGER

NEW REPORT DESCRIBES WILDLIFE WAR BETWEEN MAFIA AND ENVIRONMENTALISTS IN RUSSIAN FAR EAST

A new investigative report on organized wildlife crime in Russia is being presented to the U.S.-Russian "Gore-Chernomyrdin" Commission this week in Washington, D.C., as well as the United Nations Convention on International Trade in Endangered Species (CITES) in Geneva. The report describes how the critically endangered Siberian tiger -- predicted for extinction by international experts only two years ago -- is making an unexpected come-back. This temporary reprieve is due to new environmental enforcement and rural community programs in the Russian Far East, according to the report, and could be consolidated to secure the future of the tiger and the world's largest intact forest system if a newly proposed "Siberian Tiger Sanctuary" is created. The Sanctuary, which would also safeguard the livelihood of rural, indigenous communities, was endorsed last year by Russia's Prime Minister, Victor Chernomyrdin and the Russian Ministry of Environment.

"The United States and Russia, together with CITES, have an historic opportunity to help save the Siberian tiger, one of the most endangered species in the world; ensure the survival of the Udege people, a highly threatened indigenous community; and the Siberian taiga forest, the largest source of oxygen left on the planet," stated the author of the report, Steven Galster of the Investigative Network. "We urge CITES and the UN to support the Sanctuary proposal to preserve the progress that wildlife officials have made in protecting the magnificent Siberian tiger," said Dr. John Grandy of The Humane Society of the United States/Humane Society International, a sponsor of the report.

The main port of the Russian Far East, Vladivostok, is also home to some of Russia's most powerful mafia organizations, which tightly control aspects of the illegal wildlife and timber trade. Between 1990-1994, Russia experienced one of the worst outbreaks of commercial poaching and logging in history, resulting in a serious decline in wildlife populations and forest cover. A growing population of 400 Siberian tigers in 1989 was reduced to 150-180 by 1994-95. The report attributes this decline to illegal hunting and smuggling operations of criminal syndicates operating between Russia and at least 7 other countries, including China, South Korea, Japan, Turkey, and the United States.

New roads, created by logging operations, have facilitated the poaching. Tiger bones, bear gallbladders, musk deer glands and other lucrative wildlife parts pass through these channels, constituting an estimated $10 million dollars worth of contraband every year, the report says. The full skeleton and skin of a Siberian tiger can be sold for up to $50,000 in some cities across the world.

The report, which was also sponsored by the UK-based David Shepherd Conservation Foundation, describes how:

* poaching of the Siberian tiger has declined 75% over the past 17 months, due to activities of new anti-poaching patrols in Primorsky Territory;
* anti-poaching patrols are being threatened by the Russian mafia for exposing underground trade channels for wildlife and drugs;
* Tiger and other wildlife parts are being smuggled to China, Korea, Europe, and the United States.
* The Russian Government has appealed to tiger consuming nations, including the United States and Taiwan, to help finance the development of the tiger sanctuary.
Twenty-one percent of all remaining standing forests on the planet are in the Siberian taiga forest. This has attracted timber companies from the West and Asia whose massive logging operations have threatened the wildlife and livelihood of rural communities of Primorsky and Khabarovsky Territories in the Russian Far East.

The proposed sanctuary would halt logging operations in areas where tigers and other threatened species are found, and in the traditional hunting grounds of the indigenous Udege people.

According to the new report, while illegal tiger hunting and smuggling in the Russian Far East are on the decline, the poaching of bears and other wildlife, such as the critically endangered Amur leopard, is still a serious problem. Furthermore, poachers would re-target the tiger if enforcement operations and forest protection programs are discontinued.

For more information, please contact:
Heena Patel Investigative Network P.O. Box 73214, T Street Station Washington, D.C. 20009

Tel: 202-332-3639
Fax: 202-387-2590
2/4/96

OVERVIEW & SOURCE
Down to Earth reports on the most recent incursion into indigenous lands on Yamdena Island in eastern Maluku, Indonesia. 164,000 hectares, or 2/3 of the island, are to be logged. This despite the fact that the island contains tremendous amounts of biodiversity, and the Indonesian government has been outspoken recently concerning its intent to preserve biodiversity. Appeals for letters are made. This item was posted in econet's rainfor.general conference.

International Campaign for Ecological Justice in Indonesia
============================================================

LOGGERS MOVE IN ON YAMDENA ISLAND FORESTS AGAIN

The livelihoods of thousands of indigenous people of Yamdena in eastern Maluku are once again under serious threat as large scale commercial logging resumes on the island. State forestry company PT Inhutani I has teamed up with the private company PT Mohtra Agung, owned by Indonesia's most powerful timber magnate Bob Hasan, to log 164,000 hectares or about two thirds of the island's tropical rainforests. Logging in the southern part of the concession started in July.

The destruction of Yamdena became a national issue in 1992 when protests against logging led to bloodshed on at least two occasions. Security forces brought in to quell demonstrations beat up and shot angry protesters. In 1993, local people with national and international support brought about a temporary halt to the logging by the original concessionaire, PT Alam Nusa Segar. Pointing to research conducted by the Soil and Climate Research Centre in Bogor, the protesters then argued that the logging would destroy the island's tropical forest ecosystem, cause serious erosion, disrupting water supplies and threaten the coral reefs ringing the island which sustain local fisheries. The same arguments apply today. Yamdena's indigenous population of 83,000, have nothing to gain from the logging, but face the destruction of their traditional livelihoods and the erosion of their culture.

Local people supported by the Jakarta-based organisation ICTI - the Association of Tanimbar Intellectuals of Indonesia - and an NGO called Bina Linkungan Hidup are trying hard to stop the logging through the courts. Their attempt to secure an injunction against the companies and force an early halt to the logging has failed. A further suit filed against the Forestry Minister and PT Inhutani I which calls for a total ban on commercial logging will be heard in December.

Land rights
===========

Yamdena's indigenous people hold traditional collective land rights which cover the whole island, leaving no unclaimed or "empty" areas. But the logging companies and government alike have consistently chosen to ignore these rights. The only attention paid to the issue was by PT Mohtra Agung which staged a ceremony to give the appearance that indigenous clans had agreed to surrender their lands to the company.

Throughout Indonesia, logging companies are obliged to set aside funds to improve the welfare of local communities, but no there is no evidence of this happening on Yamdena. Neither are jobs on logging concession given to islanders. Meanwhile, if anyone protests against the companies, they are labelled "GPK" or subversive trouble-makers, by the authorities.

Biodiversity
=============

Yamdena lies on the so-called "Wallace line" which divides the two major fauna and flora types of South East Asia and Australasia. Endangered tree species unique to the island include Manilcara.sp, locally known as "torim". Yamdena is also home to a number of unique fauna species including cockatoos and a type of wild buffalo.

Commercial logging is placing these species under risk of total extinction. It is highly ironic therefore, that the Indonesian government has decided to sanction the destruction while presenting itself internationally as a champion of biodiversity. The recent meeting of parties to the Biodiversity Convention were left in no doubt as to Indonesia's commitment to fulfilling its obligations under the Convention. Actions speak louder than words, however, and the case of Yamdena illustrates how Indonesia's commitment to maintaining biodiversity falters when it comes up against the interests of the loggers and their friends in the government.

ACTION
=======

Please join the international efforts to stop the destruction of Yamdena! Write letters protesting against the resumption of logging and calling for the land rights of local people to be recognised. Point out the discrepancy between Indonesia's laudable international commitment to maintaining biodiversity and the situation on the ground in Yamdena.


Government:    Djamaludin Suryohadikusumo, Minister for Forestry 
               Forestry Building
               Manggala Wanabhakti
               Jl Gatot Subroto, Senayan
               Jakarta Pusat

               Sarwono
               State Minister for Population and Environment   
               Jl Medan Merdeka Barat 15
               Jakarta Pusat

Loggers:       Indonesia Forestry Society (MPI)
               Manggala Wanabhakti                
               Jl Gatot Subroto, Senayan
               Jakarta Pusat
               Indonesia

World Bank-led donors group:

               Consultative Group on Indonesia
               Lippo Life Building
               Jl H.R. Rasuna Said, Kav B-10
               Kuningan, Jakarta 12940
               Indonesia
__________________________________________________________________

London,
February 1996
CAMPAIGN FOR THE PROTECTION OF THE URU-EU-WAU-WAU INDIAN TERRITORY - BRAZILIAN AMAZON

We, representatives of Indigenous and Environmental NGOs and Indigenous Peoples Groups of the State of Rondonia, Brazil, identified below, would like to denounce problems affecting the Uru-eu-wau-wau People and request what follows:

The Uru-eu-wau-wau indian territory is situated in the Brazilian Amazon, in the State of Rondonia, and was created by the Presidencial Decree No. 275, of October 29, 1994. However, this territory has been intensively invaded by loggers, farmers and occupants that illegally intrude the protected area. The situation has worsened with the approval of the Presidencial Decree No. 1775 of 1996, that benefits invaders of indigenous territories.

1. Hydrographic Characteristics
The headwaters of the main affluents (Jaci-Parana, Cautario, Candeias, Jamari, Uruupa, Jaru, Muqui, Sao Miguel, Pacaas Novos e Outro Preto) of the 3 major water basins (Madeira, Mamore, Guapore) of the state of Rondonia are situated in the Uru-eu- wau-wau territory.

2. Landscape
The region is filled with scenic beauties, like the Pacaas Novos Sierra, with its highest mountain at 1,100 meters. Its scarps form kilometres of continuing walls. The water resources of the region come from these highlands.

There are archaeological sites , water falls and caves with ancient inscriptions in the area.

3. Biodiversity
The region has different ecosystems, such as rainforest, savannah, natural fields and transition vegetation. The reserve is an escape site for several animals, including threatened species.

4. Human Presence
The region has been inhabited by groups that have only had contact with the western civilization in the past 15 years. These groups are the Jupau and Amondawa, of the Tupi Guarani family and Kawghibi linguistic group, which still preserve their traditions. There are 3 uncontacted groups in the area. All this legacy is being threatened by the invaders.

In fact, in the region called "Burareiro", the National Institute for Colonization and Land Reform (INCRA) has illegally settled more than 60 small farmers, which are causing severe deforestation, killing of animals, and traffic of heavy trucks and agriculture machinery. They are promoting logging activities in the area, which are causing severe conflicts between invaders and indigenous peoples, with many casualties. These illegal activities are being supported by local and powerful politicians of the state of Rondonia.

Another serious problem is occurring in the Alto Jaru area, where 1,000 people have invaded the reserve. Also, in the Cautario area there is an invasion of miners, and loggers are invading the Terra Roxa, Serra da Onca and Linha 623 areas, all within the reserve.

Equally, in the Pacaas Novos National Park, also considered as part of the Uru-eu-wau-wau territory, one farmer, Jeovau Nilo Ribeiro, is exploring the wood and cutting down trees, planting coffee, banana and mango, making use of pesticides. He is an extremely difficult person and refuses to leave the area. Another farmer, Beneu, is another invader and refuses to leave the National Park area.

URGENT REQUEST

We would like to request the help of all of you who are concerned about the protection of the environment and the human rights of indigenous peoples. We urge you to pay attention to what is happening in Rondonia and act on behalf of these people urgently.

We suggest that you write to the Brazilian authorities listed below, urging them to take the necessary measures to protect the Uru-eu-wau-wau territory. Only a few minutes of your time will be invaluable for the protection of the territory and of the Uru-eu-wau-wau, as well as Jupau, Amondawa and uncontacted people living in that territory.

Please, request the following from the Brazilian authorities:

- immediate removal of invaders (loggers, farmers, occupants and miners) from the Uru-eu-wau-wau Indian Territory;

- enforcement of Brazilian Environmental and Human Rights Laws (Federal Constitution, Forest Code, Indian Statute, Economic- Social-Environmental Zoning Law);

- need for continuous control of the borders and territory of the Uru-eu-wau-wau Indian Reserve and contiguous Pacaas Novos National Park;

- civil and criminal accountability for the violation of Brazilian laws.

Please write to the following authorities:

1. His Excellency, Mr. Fernando Henrique Cardoso
President of Brazil
Palacio do Planalto
Brasilia , DF, Brasil, 70150-900

2. Governor of the State of Rondonia
Mr. Valdir Raupp de Mattos
Palacio Presidente Getulio Vargas, s/n
Praca Getulio Vargas
Porto Velho, Rondonia, Brasil
78900-000

3. President of FUNAI (Federal Indian Bureau)
Mr. Marcio Santilli
Edificio Lex - SRTUS
Bloco A - Zona Central
Brasilia, DF, Brasil
70340-904

4. President of IBAMA (Environmental Protection Agency)
Mr. Raul Jungmann
Quadra 05, Bloco H, Lote 5, Asa Sul, 1o. andar
Brasilia, DF, Brasil
70.070-000

5. Minister for the Environment
Mr. Gustavo Krause
Esplanada dos Ministerios
Bloco B , 5o. andar
Brasilia, DF, Brasil
70.068-900

6. Minister for Judicial Affairs
Mr. Nelson Jobim
Esplanada dos Ministerios
Brasilia , DF, Brasil
70.068-900

Thank you for your support!

* CUNPIR - Coordenacao da Uniao das Nacoes dos Povos Indigenas
  de Rondonia,  Norte do Mato Grosso e Sul do Amazonas
* Associacao Pamare do Povo Indigena Cinta Larga
* Organizacao Metareila do Povo Indigena Surui
* Kaninde - Associacao de Defesa Etno-Ambiental
* COMIN - Conselho de Missao entre os Indios
* CIMI  - Conselho Indigenista Missionario
* Forum de ONGs e Movimentos Sociais que atuam em Rondonia
* APIPAM - Associacao do Povo Indigena Parintintin do Amazonas
* OPICS - Associacao do Povo Indigena  Karitiana

Please send copies of your petitions to:

Comissao Indigena do Forum de ONGs e Movimentos Sociais que atuam em Rondonia (Indigenous Peoples Commission of the Rondonia NGO Forum)
Rua Carlos Gomes, 1001, Porto Velho, Rondonia, Brasil
Phone/Fax: 55.69.2231116
Emai: forumrouax.apc.org

ACTION ALERT! Wis. County & Exxon/Rio Algom draft Local Agreement

Forest County, WI Board Members Draft Local Agreement in Closed Session with Crandon Mining Company (Exxon & Rio Algom Ltd.).

According to agendas received via Fax on February 2, 1996 from the Clerk for Forest County, Wisconsin, the Mining and Finance Committees of the Forest County Board have met in closed sessions:

On December 18, 1995 to discuss items concerning Local Agreement, On December 28, 1995 to discuss items concerning Local Agreement, and February 1, 1996 to deliberate regarding strategy to be adopted in negotiating a Local Agreement with Crandon Mining Company and negotiations with Crandon Mining Company.

Crandon Mining Company (CMC) is a Wisconsin general partnership comprising subsidiaries of Exxon Coal and Minerals Company and Rio Algom Limited. CMC is seeking permits to construct and operate a metallic sulfide mine immediately adjacent to the Mole Lake Indian Reservation in northeast Wisconsin.

Over its lifetime, the mine would generate an estimated 44 million tons of acidic wastes. When metallic sulphide wastes have contact with water or air, the result is sulphuric acids, and high levels of poisonous heavy metals like mercury, lead, zinc, arsenic, copper and cadmium.

Half of the projected waste--rocky "coarse tailings"--would be dumped to fill up the mine shafts. The other half of the waste is powdery "fine tailings," which would be dumped into a waste pond about 90 feet deep and covering 355 acres-- about 340 football fields in size.

Even Wisconsin's own Department of Natural Resources admits there have been no successfully reclaimed metallic sulfide mines. Why should the the citizens of Crandon and Forest County, Native American Tribes, and the people of Wisconsin be an experiment for Exxon?

A statewide broad-based coalition of people, including environmentalists, Native American tribes, sportsfishers, hunters, and business owners are working together to protect Wisconsin from Exxon and Rio Algom. The Crandon Chapter of Wisconsin Resources Protection Council has recently joined the struggle.

Now, the Forest County Board is trying to negotiate a local agreement which would enable CMC to avoid complying with county zoning codes and ordinances.
Although the Mining and Finance Committees have allowed citizens to present statements at their meetings, citizens have been barred from participating in those committees' discussions about the local agreement and negotiation with CMC on the local agreement. Despite opposition by Crandon citizens, members of the Mole Lake tribe, and Forest County citizens, the Forest County Board have drafted the local agreement in closed sessions.

The entire draft of the local agreement is included as an attached file. Here are a few excerpts:

                             - Page 7 -
FOREST COUNTY PERMITS AND APPROVALS

The Project Area may be used for all Mining Operations and Forest County hereby grants all the permits, approvals, variances and licenses that state law or its ordinances do or may require for Mining, including the permit described inWis. Stat. 86.16. During the terms of this Agreement, the Forest County Zoning Ordinance, the Forest County Shoreline Zoning Ordinance and all other Forest County ordinances and resolutions which would otherwise apply to the Project Area, whether enacted in the past or in the future, are expressly superseded by this Agreement and shall not be applicable to the Project Area, the Mining Operation or the Pipeline.

                             - Page 8 -
FOREST COUNTY PARTICIPATION IN DNR HEARINGS

Forest County will support CMC's application for the Mining Permit and other approvals needed for Mining, and will take no action that may cause a delay in the permitting of the Mine."

                             - Page 22 -
"PAYMENTS TO FOREST COUNTY

A. Commencing with the onset of construction, and during anticipated years of mine operation, as well as during all phases of mine closure it is anticipated that Forest County will incur substantial costs as well as adverse impacts resulting in an increased need for government services; the construction of needed public improvements, and rehabilitation of existing County buildings and/or facilities or equipment. In consideration of the foregoing the following payments shall be made to Forest County:

1. PAYMENTS IN LIEU OF OR IN ADDITION TO NET PROCEEDS TAX:
That commencing on December 1 of the calendar year in which all permits have been granted to CMC and concluding with December 1 of the calendar year in which the mine is closed CMC will pay to Forest County the sum of $516,700 each such year,. . . "

"2. CONTRIBUTION TO COST OF CONSTRUCTION OF NEW COUNTY JAIL FACILITY AND NEW COUNTY HIGHWAY SHOP:
A. That CMC shall finance the construction of a new Forest County jail facility and 911 communication complex by granting to Forest County a loan in the principal amount of $3,000,000."

"B. That CMC shall finance the construction fo a new Forest County Highway shop by granting to Forest County a loan in the amount of $2,000,000."

                         - Page 24 -
"RENEGOTIATION

A. Forest County may cause specific terms of this agreement to be reopened for negotiation in the event CMC proposes a substantial modification of the Mining Plan or the Reclamation Plan before approval by the DNR or under Wis. Stats. 144.87, and if CMC puts the modification into effect after all necessary state or federal approvals have been obtained.

B. For purposes of this Article, "substantial modification" means any of the following:

1. Increasing production to an average of more than 6,500 tons of ore per day;
2. Increasing employment during the Operating Period to more than 600 full-time equivalent employees whose ordinary place of work is at the mine site or elsewhere in Forest, Oneida, or Langlade counties;
3. Increasing the discharge of treated water from the water treatment plant to more than 3,000 gallons per minute;
4. Proposing to mine commercial quantities of uranium or thorium;
5. Reducing the low permeability soil bottom liners of tailing management areas to a thickness of less than eight inches.
6. Decreasing production to less than 3,250 tons of ore per day. Decreasing employment during the Operating Period to less than 300 full-time equivalent employees whose ordinary place of work is at the mine site or elsewhere in Forest, Oneida, or Langlade counties."

Time is Short

The time to act on this is now. On February 7, a public announcement will be posted for a public hearing regarding the local agreement. According to one person who attended the February 1, meeting the Forest County Board intends to hold the public hearing on February 27--the same day the as the first tentative signing of the local agreement.

What you can do:

1. Please! Phone, fax, and write the Forest County Board. Voice your concerns about the Board and its Mining and Finance Committees drafting a Local Agreement with CMC in closed session. Tell the Board how you feel about a local agreement that could result in 22 million tons of acid mine drainage being dumped in tailings ponds at the headwaters of the Wolf River, an Outstanding Resource Water.

Forest County Board
Crandon County Courthouse
200 East Madison St.
Crandon, WI 54520
PH: (715) 478-2422
FX: (715) 478-5175

Chairman: Erhard Huettl

Mining Committee Members
Paul T. Millan
Edward Piontek,Jr.
Gerald L. Voras
Michael S. Kane
Ray A.McGeshick
Chester Gryczkowski
Alton B. Ison

Finance Committee Members
Louis Yourchak
Edward Penasa
Michael S. Kane

2. Write, phone, fax, and email your concerns to Wisconsin Senator Roger Breske and Wisconsin Representative Lorraine Serrati

Call the Wisconsin Legislative Hotline
1-800-362-9472, toll-free
To be connected to Senator Roger Breske or Representative Lorraine Serrati, the Wisconsin legislators who represent the area where the proposed mine would be located.
Tell the legislators how the proposed mine would impact your decisions to vacation in northeast Wisconsin, move to Wisconsin, and/or locate your business in Wisconsin.
Let Senator Breske and Representative Serrati know what you think about a Wisconsin County Board that refuses to allow its citizens to participate in negotiations with a mining company when the mine could have such a tremendous impact on those citizen's lives.

Senator Roger Breske
P.O. Box 8953
Madison, WI 53708
(608) 266-2509

Representative Lorraine Seratti
P.O. Box 7882
Madison, WI 53707-7882
(608) 266-3780

Write letters to the Editor:

Mike Monte
Editor, Pioneer Express
Crandon, WI 54520

The Capital Times
1901 Fish Hatchery Road
Madison, WI 53713

4. Call Wisconsin Tourist Bureau, 1-800-432-8747, toll-free Tell them how you'd feel about vacationing in northeast Wisconsin if the mine were permitted.

5. Call or Write James Doyle, Wisconsin's Attorney General. Ask if the Forest County Board was in total compliance with Wisconsin's Open Meeting law when it met in closed sessions with Crandon Mining Company.

Attorney General James Doyle
114 E State Capital Building
Madison, WI
608-266-1221

6. Voice your concerns to:
Governor Tommy Thompson
Madison, WI 53702
608-266-1212

Wisconsin Department of Natural Resources
Box 7921
Madison, WI 53707
608-267-7534; 608-266-2121

President Bill Clinton
Comment Line during working hours (9-5 EST)
202/456-1111, Fax: 202/456-2883,
E-mail: president@whitehouse.gov
The White House, Washington, D.C. 20500

Vice President Al Gore, Council on Environmental Quality,
202/456-6224, Fax: 202/456-2710,
E-mail: vicepresident@whitehouse.gov
The White House, Washington, D.C. 20500

7. EMAIL WISCONSIN CONGRESSMEN:

Feingold, Russell D.     senator@feingold.senate.gov
Kohl, Herb               senator_kohl@kohl.senate.gov
Roth, Toby               roth08@hr.house.gov
And thank you for your efforts.
+++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

2. Letter from Tom Ward, President of WRPC, Crandon Chapter
Tom R. Ward
FX: 715-478-2384
February 2, 1996
Dear Editor,
Last night (2/1/96) our Forest County board Mining & Finance committees, by unanimous vote, agreed to meet behind closed doors to hammer out the details of a local mining agreement with Exxon/Rio Algom Ltd. of Canada. This decision to conduct public business in private was made despite impassioned protest from local citizens. This was a sad night for freedom of expression, and brings up the question: Whatever happened to our basic concept of government of the people, by the people, and for the people?

Tom R. Ward
Wisconsin Resources and Protection Council (WRPC)
Crandon Chapter
Box 795, Rt.1
Crandon, WI
715-478-2384

Content-Type: text/plain; name="ExLocal"; charset="us-ascii"
Content-Disposition: attachment; filename="ExLocal"

Alice McCombs
P.O. Box 573
Shawano, WI 54166
PH: 715-524-5998
FX: 715-524-9958
Email: amccombs@mail.wiscnet.net

Contents:

1. Manually retyped copy (2/3/1996) of letter from Fred W. Kawalski to Mr. Gerald Voras and Mr. Ray McGeshek, Sr. dated January 3, 1996.
2. Manually retyped copy (2/3/1996) of letter from Fred W. Kawalski to Mr. Erhard Huettl dated December 29, 1995.
3. Manually retyped copy (2/3/1996) of draft copy of Local Agreement by Forest County and Crandon Mining Company.
1. Manually retyped copy (2/3/1996) of letter from Fred W. Kawalski to Mr. Gerald Voras and Mr. Ray McGeshek, Sr. dated January 3, 1996.

Fred W. Kawalski
Attorney at Law
612 Clermont Street
Suite 4
Antigo, WI 54409-1942

Fred W. Kawalski
715-623-5339
715-623-3989

Crandon Office:
300 W. Pioneer Street
Crandon WI, 54520
715-478-3341
Mailing Address
612 Clermont Street
Suite 4
Antigo, WI 54409-1942

January 3, 1996

Mr. Gerald Voras
Star Route
Box 59
Pickerel, WI 54465

Mr. Ray McGeshick, Sr.
Rt. 1
Box 643
Crandon, WI 54520
Re: Local Agreement

Dear Mr. Voras and Mr. McGeshick:

The purpose of this letter is to follow up on the draft of the Mining Agreement that I had sent to you as part of the review of the Local Agreement with the Forest County Mining Committee and Finance Committees. This letter is sent to you specifically since neither of you attended the last two meetings. At that time it was decided by the Committee that the terms of this Agreement be kept confidential, at leaste until such time as it is presented to the full County Board. The matters that are contained in the Local Agreement, most of which at least were discussed at a closed session of the Forest County Mining Committee after motion duly made and seconded to move into closed session pursuant to the open meetings law. I neglected to mention this in my rush to get out the first draft of the Agreement to you.

Sincerely yours
Fred W. Kawalski
FWK: dm
c/c Erhard Huettl
2. Manually retyped copy (2/3/1996) of letter from Fred W. Kawalski to Mr. Erhard Huettl dated December 29, 1995.

Fred W. Kawalski
Attorney at Law
612 Clermont Street
Suite 4
Antigo, WI 54409-1942

Fred W. Kawalski
715-623-5339
715-623-3989

Crandon Office:
300 W. Pioneer Street
Crandon WI, 54520
715-478-3341
Mailing Address
612 Clermont Street
Suite 4
Antigo, WI 54409-1942

December 29, 1995

Mr. Erhard Huettl
Rt. 1
Box 8C05
Wabeno, WI 54566

Dear Mr. Huettl:

This letter is addressed to you as Chairman of the County Board, however, photocopies of this correspondence as well as the completed Local Agreement is being transmitted to each member of the Forest County Finance Committee as well as the Mining Committee.

I am enclosing the entire Agreement, specifically adding pages that have been addressed by the Committee as well as setting for the inclusions of the Local Agreement as well as setting forth the inclusions of the Local Agreement as was decided at our meeting of December 28, 1995.

One area that I had on my notes but neglected to bring up was the questions of the percentage of reimbursement of fees for attorneys and consultants. My notes indicated that we were going to negotiate this particular item with the Mining Company, however, we never did arrive at an exact amount, that amount being left to later discretion. You will note that I have inserted in that provision the amount of $150,000.00 which would be reimbursed to Forest County by the Crandon Mining Company with 50% of the next $300,000. Admittedly, I just drew this figure on my own, however, this is on my computer and I can change it upon request.

Having gone to great lengths to get this out as quickly as possible to you, I would ask that if you or any member of the Committees desire any matter to be changed, reworded, deleted, or added that they contact me as soon as possible so that we can have the meeting with Crandon Mining Company by January 10, 1996. I would propose that this Agreement unless amended by virtue of telephone contact with the Chairman be transmitted via fax to Attorney James Houston as well as to Dick Diotte no later than the conclusion of business on Thursday, January 4, 1996. At that time I will advise Mr. Diotte that the committee has scheduled a meeting for Wednesday, January 10 and invite both he and Mr. Houston to attend. I believe it only fair that we give them at least six days, including weekends, to review this document. In view of the holiday many of you may not receive these materials until January 2, however, at least you will have that day as well as the next two following days in which to contact me. I am advising my office staff that any telephone calls from any Committee members, or particularly the Chairman, shall be given priority and I shall be interrupted so as to take your call.

Accordingly, because of the tight time frame in which we are dealing, I would respectfully request that each member of the Committee review these materials as soon as possible. If there is any difficulty perhaps we may have to put the meeting off by a week. I believe that would be a more prudent course to follow rather than to rush into this unprepared.

Sincerely yours,
Fred W. Kawalski
FWK: dm
Enc.
3. Manually retyped copy (2/3/1996) of draft copy of Local Agreement by Forest County and Crandon Mining Company.

This Local Agreement ("Agreement") is entered into the _____ day of October, 1995, by and between Forest County ("Forest County") and Crandon Mining Company ("CMC").

Page 1
RECITALS

WHEREAS, CMC is a Wisconsin general partnership comprising subsidiaries of Exxon Coal and Minerals Company and Rio Algom Limited; and
WHEREAS, CMC desires to construct and operate a metallic minerals mine located in Forest County (the "Mine"); and
WHEREAS, CMC has submitted an applicating for a Mining Permit from the Wisconsin Department of Natural Resources ("DNR"); and
WHEREAS, CMC has begun the process of obtaining all other necessary approvals and permits for the Mine;
NOW, THEREFORE, in consideration for the promises herein exchanged, Forest County and CMC make this Local Agreement under the authority granted by Wis. Stat. 144.839.
Page 2

DEFINITIONS
In this Agreement:
Citizens Advisory Committee or Committee means the Committee established by Article _____ of this Agreement.
Construction Period means the period which begins with the close of the Permitting Period and ends when CMC first ships a commercial quantity of metal concentrates extracted from the mine.
Current Revenues means funds received by Forest County in a single calendar year.
DNR means the Wisconsin Department of Natural Resources.
Extended Care Period means the period which begins with the close fo the Reclamation Period and extends through the period specified by the DNR in the Mining Permit.
Local Agreement means an agreement between CMC and one or more local governments under the authority of Wis. Stat. 144.839.
Mining or Mining Operation means all or any part of the process involved in the mining or removal of metallic minerals from the ground, including but not limited to the extraction and beneficiation of metal concentrates, the handling and treatment of water pumped from the mine or otherwise affected by mining, the handling and disposal of mill tailings and other waste generated by mining, the

Page 3

construction of roads, railroad lines and pipelines associated with mining, the production of refuse, the mitigation of the effects of mining, and every other activity associated with mining which may be subject to regulation by Forest County.
Mining Permit means the permit issued by the DNR which is required of all operators as a condition precedent to commencing mining at a mining site, and includes any modifications to the Mining Permit authorized by the DNR pursuant to Wis. Stat. 144.87.
Mining Plan means the proposal for the mining of the mining site submitted by CMC to the DNR pursuant to Wis Stat. 144.85 (3) (a).
Mining Site means the surface area within Forest County which is disturbed by the mining operation, including the areas occupied by ancillary facilities such as those for water treatment, water movement or discharge, i mplementation of DNR-approved contingency and mitigation plans, administration offices, warehousing, maintenance shops, access roads, railroad spurs, and tailings management, and all other surface areas on which structures, equipment, materials and any other things used in mining are located.
Net Proceeds Tax means the tax describe in Wis Stat. 70.375 et seq. If Secs. 70.375 et seq. are repealed or replaced in any way by another tax (such as a severance tax) after the effective date of this Local Agreement, the term
Page 4

"Net Proceeds Tax" shall be interpreted to mean that replacement tax.
Operating period means the period which begins with the close of the Permitting Period and ends upon the earlier of (1) the cessation of mining pursuant to a mining plan or modified mining plan approved by the DNR under Wis. Stat. 144.85 or 144.87 or (ii) the abandonement of mining under Wis. Stat. 144.815.
Permitting Period means the period which begins when this Agreement is signed by both parties and ends when CMC begins construction of the mine after receiving its Mining Permit and the written authorization to mine required by Wis. Stat. 144.86 (3).
Pipeline means as much of the facility for transportating water from the Mine to the Wisconsin River as lies within Forest County. The term Pipeline includes, without limitation, pumping stations, outfall devices, measuring devices and every other associated facility.
Pipeline Route means all lands in Forest County which are necessary or convenient for the construction or maintenance of the Pipeline.
Project Area means all of the surface area within Forest County in which CMC has an ownership, leasehold or easement interest and which is used or intended to be used in connection with Mining. The Project Area includes but is not limited to the Pipeline Route and Mining Site, as the

Page 5

latter term is defined by Wis. Stat. 144.81 (8); surface areas which are disturbed by the construction of, or which overlie, any pipeline used for the handling or discharge of liquids; wetlands restored or to be restored pursuant to the requirement of any state or federal rule or agency; areas necessary or useful for the implementation of present or future contigency or mitigation orders of any local, state, or federal agency; and areas necessary or useful in the reclamation or long term care of the Project Area pursuant to the requirements of any local, state, or federal rule or agency.

Reclamation Period means the period which begins with the close of the Operating Period and ends when the DNR issues a certificate of completion of the Reclamation Plan for the entire mining site.
Reclamation plan means the proposal for the reclamation of the mining site submitted by CMC to the DNR pursuant to Wis. Stat. 144.85 (3) (b).

Page 6

SCOPE
This Agreement governs the Project Area. Legal descriptions of the lands subject to this Agreement are set out in Exhibit A. where the names of the legal and equitable owners of these lands are also to be found. However, any inconsistency between Exhibit A and the definitions of the Project Area, the Mining Site, or the Pipeline Route shall be resolved by including the land in question within the scope of the agreement.

Page 7

FOREST COUNTY PERMITS AND APPROVALS

The Project Area may be used for all Mining Operations and Forest County hereby grants all the permits, approvals, variances and licenses that state law or its ordinances do or may require for Mining, including the permit described inWis. Stat. 86.16. During the terms of this Agreement, the Forest County Zoning Ordinance, the Forest County Shoreline Zoning Ordinance and all other Forest County ordinances and resolutions which would otherwise apply to the Project Area, whether enacted in the past or in the future, are expressly superseded by this Agreement and shall not be applicable to the Project Area, the Mining Operation or the Pipeline.

Page 8

FOREST COUNTY PARTICIPATION IN DNR HEARINGS

Forest County will support CMC's application for the Mining Permit and other approvals needed for Mining, and will take no action that may cause a delay in the permitting of the Mine.

Page 9

ENVIRONMENTAL IMPACTS

CMC may not begin construction of the Mine or engage in Mining until it receives a Mining Permit and the written authorization to mine under Wis. Stat. 144.86 (3), and CMC shall thereafter comply with the terms of this Agreement, the Mining Permit, and other applicable provisions of state and federal law and regulation.

Page 10

FENCING

For the purpose of protecting the environment, safeguarding its employees or the public, or securing its property interests, CMC shall have the right to fence all or any portion of the Project Area during the Permitting, Construction, Operating, Reclamation and Extended Care Periods.

Page 11

EMPLOYMENT

A. CMC will cooperate with Forest County and with appropriate area and state agencies to develop and operate training programs for the skills that CMC will need in constructing and operating the Mine and in reclaiming the Project Area.

B. Applicants who have the skills needed by CMC and who attended a high school located in, or who lived continuously for (1) year in Forest County, or who have been residents or Forest County and while doing so have attended Goodman High School in Marinette County will be preferred in CMC's hiring decisions.

C. Thereafter, CMC will give preference to applicants who have the necessary skillsand who have attended a high school located in Langlade, Oconto, Marinette, or Oneida County.

Page 12

PERMANENT DISPOSITION OF THE PROJECT AREA

A. CMC will retain ownership of the Project Area at the close of the Reclamation Period, and will dedicate to wildlife conservation as much as the Project Area as is consistent with safety and its long-term care plan. B. After the close of the Reclamation Period, CMC will retain the right to withdraw any or all of the Project Area from its use for wildlife conservation and to use any or all of the Project Area for prospecting or mining, subject to the federal, state, and local laws and regulations then in force.

Page 13

CITIZENS ADVISORY COMMITTEE

A. Forest County and CMC shall cooperate in creating and supporting a Forest County Citzens Advisory Committee ("Committee"). Each community which has entered into a Local Agreement with CMC may appoint two representatives to the Committee, and they shall be known as Public Members. The President of CMC or the designee thereof, and one other representative of CMC to be appointed by its President, shall also be representative of CMC to be appointed by its President, shall also be representatives to the Committee. Each jurisdiction appointing one or more Public Members and CMC shall have only one vote.

B. Each Public Member shall be paid a per diem of $20 for each Committee meeting attended, not to exceed $500 per year, which payments shall be funded by CMC.

C. All other expenses of the Committee, not to exceed $5,000 annually, shall be funded by CMC. Expenses incurred in any calendar year in excess of $5,000 shall be funded by equal assessments on Forest County and the other governmental jurisdictions which have entered into the Local Agreement and have appointed one or more Public Member. The CMC representatives shall have no vote on assessment or expenditure questions.

D. At the first meeting of each calendar year, the Committee shall elect a Chairperson, Vice-chairperson, Secretary, and such other officers as the Committee shall determine by majority vote, and the terms of each officer shall be one year.

E. The Committee shall meet monthly during the Permitting Period and four times each year thereafter.

F. The Commitee shall adopt by-laws and provide by rule for its proceedings.

Page 14

G. CMC will furnish the Committee with copies of all reports that it is required to make to the DNR or to any municipality with which CMC has entered into a Local Agreement.

H. Upon request, CMC will permit a qualified technician designated by the Committee or by any one of its member jurisdictions to observe CMC's routine sampling of water entering the CMC water treatment plant, leaving the CMC water treatment plant, or outalling to the environment from any CMC water outfall pipeline.

I. Upon request, CMC will supply to the Committee or to any of its member jurisdicitions shares of its routinely-taken samples of water entering the CMC water treatment plant, leaving the CMC water treatment plant, or outfalling to the environment from any CMC water outfall pipeline. J. At least quarterly during the last year of the Construction Period and the first year of the operating period, CMC will provide the Committee with statistical data relating to its compliance with the EMPLOYMENT article of this Agreement.

K. The Committee may review and consider any matters which it deems germane to the Mining Operation or to its impact on the region, and may make findings or recommendations which whichit shall promptly report to CMC, to Forest County, and to all other entities which have appointed members. Other activities of the Committee may include (but are not limited to) the following:

1. Inspecting the Project Area and Mining Operations at reasonable times and after reasonable notice to CMC;

Page 15

2. Receiving and reviewing complaints from any person about Mining Operations;
3. Reviewing CMC's compliance with its Local Agreements;
4. Mediating and disagreements that may arise between CMC and any jurisdiction which has entered into a Local Agreement;
5. Making recommendations about means for mitigating any dangers, hazards or nuisances related to Mining Operations;
6. Making recommendations about the uses of the project Area after the close of the Reclamation Period;
7. Making other recommendations which it deems pertinent to the construction, operation, closure, long-term care and post-reclamation uses of the Project Area; and
8. Monitoring CMC's compliance with the employment section of this agreement regarding preference and training programs.

Page 16

ENVIRONMENTAL SAMPLING

During the Operating Period, the Committee may designate a qualified technician to enter the Project Area to take samples of water entering the CMC water treatment plant, or outfalling to the environment from any CMC water treatment plant, leaving the CMC water treatment plant, or outfalling to the environment from any CMC water outfall pipeline. The expenses incurred by said qualified technician shall be subject to the provisions of subparagraph C of the section of this agreement entitled "CITIZENS ADVISORY COMMITTEE". This sampling shall be subject to the following conditions:

1. Sampling shall be for the sole purpose of monitoring CMC's compliance with a Local Agreement.
2. CMC shall have the right to observe while the designated technician takes each sample, and the techniciam shall immediately divide each sample into two portions which shall be equal in quality and quantity, and CMC shall be entitle to retain its choice of the two portions.
3. The Committee shall give written notice of its intent to sample, which notice shall be received by CMC at least 48 hours in advance of the time designated for the taking of the sample. However, only reasonable notice (which may be given in person or by telephone) shall be required for sampling between the hours of 9 a.m. and 4 p.m. on ordinary business days.
4. After any sample is taken pursuant to this Article the Committee shall forward a sufficient quantity of the sample for analysis at its own expense to one or more qualified laboratories within seven days, and shall supply CMC copies of all reports and analyses of the sample
Page 17

within seven days after it receives them. If CMC submits its share of the sample to one or more outside laboratories, it shall supply the Committee with copies of all reports and analyses of the sample within seven days after it receives them.
5. The Committee may take samples pursuant to this Article not more than once per calendar quarter unless it has reasonable grounds to believe that CMC is conducting mining operations in violation of this Agreement or of the Mining Permit, and unless it has given written notice of those groundst o CMC by hand delivery or by certified mail.

Page 18

FEES FOR CONSULTANTS AND ATTORNEYS

A. CMC will reimburse Forest County for the reasonable and necessary fees that Forest County pays for services rendered by attorneys and consultants on mining-related matters for the following purposes ("Qualifying Fees"):
1. To monitor CMC's permitting activities and to prepare for and to appear at the hearing describe in Wis. Stats. 144.836; and
2. To defend against any suit challenging the validity of this agreement if such suit is brought by a third party during the Permitting Period, provided that Forest County shall first have tendered to CMC the opportunity to defend such suit on behalf of Forest County and CMC shall have declined to undertake Forest County's defense.
B. To receive reimbursement under this section, Forest County shall forward its attorneys and consultants itemized statements for Qualifying Fees, together with proof of payment. Such statements shall show at least the names and usual hourly rates of the persons performing the services, detailed service descriptions, and the amount of time spend on each service item. Payment by CMC shall be due within 60 days.
c. CMC's obligations under this section during the entire life of this agreement shall be limited to reimbursing Forest County for the first $150,000 in Qualifying Fees,a dn 50 percent of the next $150,000 in Qualifying Fees.

Page 19

D. CMC shall have no obligation to reimburse Forest County for any fees which may be reimbursable by any other person (including but not limited to payments described in sec. 70.395 (2) (fm), Stats.) unless Forest County's timely and proper application for reimbursement from such other person shall have been denied.
E. Nothing in this Agreement shall be construed as giving Forest County any right of indemnification or contribution against CMC.

Page 20

COSTS INCURRED BY FOREST COUNTY BOARD

A. CMC will reimburse Forest County for the reasonable and necessary expenses that Forest County pays for per diem and out-of-pocke expenses incurred by the Forest County Mining Committee and the Forest County Board with respect to meetings, hearings, and other mining related matters for the following purposes (Qualifying Fees):

1. To monitor CMC's permitting activities and to prepare for and appear at any hearing describe in Wis. Stats. 144. 836; and
2. Any Committee or County Board meetings in which the principal item on the agenda is to vote on a Resolution, Ordinance, or agreement related to mining.

B. To receive reimbursement under this Section Forest County shall direct the County Clerk to send itemized statements of costs incurred by Forest County for per diems; mileage, lodging, and meal expenses; together with proof of payment.

C. CMC's obligation under this Section during the entire life of this agreement shall be limited to reimbursing Forest County for 100 percent of the first $5,000 incurred and 50 percent of the next $5,000 so incurred in qualifying fees.

Page 21

PROTECTION OF PRIVATE WATER SUPPLY

A. That notwithstanding the remedies provided by Wis. Stats. 144.855(4) CMC agrees to notify Forest County of any complaints made by or on behalf of persons as defined by 144.855 (4) whose property is within the corporate boundaries of Forest County, which claim alleges that a private water supply has been contaminated or otherwise adversely affected as a result of mining operations. The notice required hereunder shall identify fully the nature and extent of the alleged contamination or adverse effect; the identity of the property owner and the exact location of the well or other water supply source that has been allegedly contaminated or affected.

Forest County shall reserve the right to undertake, at its discretion, an investigation independent of and in addition to any investigation conducted by the Department of Natural Resources or any other governmental unit or agencies has been inflicted upon surrounding properties or to otherwise effect the welfare of the citizens of Forest County. Forest County reserves the right as part of this agreement to pursue any remedies which may be allowed by law or at equity. At the conclusion of the investigation all costs so incurred by Forest County shall be reimbursed to said County by CMC.

Page 22

PAYMENTS TO FOREST COUNTY

A. Commencing with the onset of construction, and during anticipated years of mine operation, as well as during all phases of mine closure it is anticipated that Forest County will incur substantial costs as well as adverse impacts resulting in an increased need for government services; the construction of needed public improvements, and rehabilitation of existing County buildings and/or facilities or equipment. In consideration of the foregoing the following payments shall be made to Forest County:

1. PAYMENTS IN LIEU OF OR IN ADDITION TO NET PROCEEDS TAX:

That commencing on December 1 of the calendar year in which all permits have been granted to CMC and concluding with December 1 of the calendar year in which the mine is closed CMC will pay to Forest County the sum of $516,700 each such year, which payment may be adjusted in the following fashion:

a. That the payment provided for above shall be decreased in any such calendar year by the amount received by Forest County from net proceeds tax revenues.
b. That commencing with the fifth year subsequent to the acquisition of CMC of all necessary permits to commence mining and continuing each year thereafter until the mine is closed the amount paid as set forth above shall be increased by the percentage equal to the consumer price index as determined by the United States Department of Labor.

2. CONTRIBUTION TO COST OF CONSTRUCTION OF NEW COUNTY JAIL FACILITY AND NEW COUNTY HIGHWAY SHOP:

A. That CMC shall finance the construction of a new Forest County jail facility and 911 communication complex by granting to Forest County a loan in the principal amount of $3,000,000. There shall be no finance charges incurred, nor shall the loan incur interest during its term which shall be amortized over a period of

Page 23

15 years. The payments shall be made by Forest County to CMC on or before December 1 of each year of each year commencing on December 1, 1996 as more fully appears on schedule A-1which is attached hereto, provide all necessary permits to commence mining have been acquired by CMC. At the conclusion of the payment due December, 2010 the principal balance then remaining which is $1,000,000 shall be forgiven and the loan shall be paid in full.

In the event permits are not obtained by CMC then and in such event the payments made by Forest County shall be as more fully set forth on schedule A-2 with the principal balance due subsequent to the payment due December 1, 2010 to be forgiven by CMC.

B. That CMC shall finance the construction fo a new Forest County Highway shop by granting to Forest County a loan in the amount of $2,000,000. There shall be no finance charges no shall the loan incur any interest during its term. CMC shall be obligated to provide the loan at such time as the Forest County Board of Supervisors adopts the necessary Resolution and completes other preliminary matters allowing for the construction of a new Forest Highway shop. The principal shall be repaid by Forest County to CMC amortized over a period of 15 years. The date said payment shall be due and the amount so paid by Forest County to CMC shall be dependent upon the actual time table of construction, however, for illustrative purposes solely, schedule B-1 sets forth anticipated payment dates. Accordingly, the date said payment shall be due and the amount so paid by Forest County to CMC shall be as more fully set forth on schedule of B-1 attached hereto, excepting, however, the date of commencement of payments may be altered as set forth herein. That subsequent to the payment due on December, 2010 any principal balance then remaining shall be forgiven and the loan shall be deemed paid in full.

That in the event permits are not granted, then payments shall be made as set forth on schedule B-2, once again allowing for alteration due to anticip ated date of construction, which payments allow for the repayment of the entire principal.

Page 24

RENEGOTIATION

A. Forest County may cause specific terms of this agreement to be reopened for negotiation in the event CMC proposes a substantial modification of the Mining Plan or the Reclamation Plan before approval by the DNR or under Wis. Stats. 144.87, and if CMC puts the modification into effect after all necessary state or federal approvals have been obtained.

B. For purposes of this Article, "substantial modification" means any of the following:

1. Increasing production to an average of more than 6,500 tons of ore per day;
2. Increasing employment during the Operating Period to more than 600 full-time equivalent employees whose ordinary place of work is at the mine site or elsewhere in Forest, Oneida, or Langlade counties;
3. Increasing the discharge of treated water from the water treatment plant to more than 3,000 gallons per minute;
4. Proposing to mine commercial quantities of uranium or thorium;
5. Reducing the low permeability soil bottom liners of tailing management areas to a thickness of less than eight inches.
6. Decreasing production to less than 3,250 tons of ore per day.
Decreasing employment during the Operating Period to less than 300 full-time equivalent employees whose ordinary place of work is at the mine site or elsewhere in Forest, Oneida, or Langlade counties.
C. Forest County's right to reopen shall be subject to the following conditions:

Page 25

1. Renegotiation shall not be required or shall be terminated if the proposal for substantial modification is withdrawn by CMC or denied by the DNR or by any other state or federal agency whose approval is required.
2. Renegotiation shall be limited to such portions of this agreement as are reasonably related to the substantial modifications proposed by CMC and to the mitigation thereof.
3. Forest County must give notice to CMC in writing of its intent to renegotiate within 60 days after CMC proposes the substantial modification, and time is of the essence of this provision.
4. The notice shall (i) identify the substantial impact on Forest County which is reasonably expected to result from the substantial modification (ii) identify each Article of this Agreement which Forest County seeks to renegotiate, (iii) describe how Forest County believes the Article or Articles should be revised, and (iv) explain how the revision is expected to mitigate the expected substantial impact.
5. CMC shall reply to the foregoing notice in writing within 30 days of receipt, and shall enter into good faith negotiations within 30 days thereafter.
6. Either party may invite other persons (including technical consultant or facilitators) to assist in reaching an agreement.

Page 26

D. If the parties have not agreed as to modifications of the Agreement within 90 days after the DNR approves the substantial modification, either party may ask the Committee to assist them in reaching an agreement. Thereafter, both parties shall cooperate with the Committee's mediation efforts. No recommendation or decision of the Committee shall be binding on either party. If the parties have not agreed as to modifications of the Agreement within 90 days after seeking mediation by the Committee (or such other period as the parties may agree to), either party may seek its remedies in law or equity.
E. In the event any local, state, or federal authority issues an order requiring CMC to mitigate or remedy an enviromental impact (including but not limited to the draw down of a lake or stream), CMC may unilaterally modify this agreement to permit such mitigating or remedial activities by filing with the Forest County (i) a copy of such order and (ii) a legal description of the lands on which these activities will take place. Thereafter, Forest County shall have the right to renegotiate other provision of this Agreement as necessary to mitigate the actual it incurs as a result of these activities. If the parties have not agreed upon modifications that will mitigate Forest County's costs within 90 days after Forest County has proposed modifications in writing, either party may ask the Committee to assist them in reaching an agreement. Thereafter, the parties may process as in Paragraph D above.

Page 27

F. In any action under this Article, a court of competent jurisdiction shall have authority only to modify those terms of this Agreement which are reasonably related to the substantial modifications implemented by CMC and then only to the extent necessary to mitigate the effects of those modification, provided, however, that no court-ordered amendment shall directly or indirectly prohibit CMC from operating the Mine or any related facility pursuant to the terms of the Mining Permit.

Page 28

DEFAULTS AND DISAGREEMENTS

A. If a party fails to make a payment when due under this Agreement, the other party may give written notice of the non-payment. The notice shall fix a period of not less than 15 days during which the non-paying party may pay the sum due (the "Cure Period"). If the non-paying party does not make the payment during the Cure Period, interest shall thereafter run at the rate of 12 percent per year and the other party may seek the assistance fo the Citizens Advisory Committee or pursue its remedies in law or equity. B. If a party believes the other has breached a term of this Agreement (other than a term requiring a payment), it may give the other party a written notice which sets out the nature and circumstances of the breach and describes the manner in which the other party can cure the breach. The party who recieves such a notice shall have 30 days in which to cure the breach or to respond in writing, stating its own views of the alleged breach. Thereafter, the parties shall meet and shall use their best efforts to resolve any remaining dispute. Either party at its own expense may invite other persons (including technical consultants or facilitators) to assist in resolving the dispute. If the parties have not resolved any dispute relating to the alleged breach within thirty days after their first meeting, either party may ask the Committee to assist them in reaching an agreement. Thereafter, both parties shall cooperate with the Committee's mediation efforts. No recommendation or decision of

Page 29

the Committee shall be binding on either party. If the parties have not resolved their disputes within 90 days after seeking mediation by the Committee (or such other period as the parties may agree to), either party may seek its remedies in law or equity.

C. During the term of this Agreement, Forest County may sue CMC (or its assignee, if CMC shall have assigned its interests pursuant to this Agreement) only for breach of this Agreement or for violation of Wisconsin or United States law, but not for violation of any Forest County ordinance or resolution. In any such action, no court may directly or indirectly prohibity CMC from operating the Mine or any related facility solely for breach of this Agreement if such operations are in substantial compliance with applicable state and federal regulations and permits.

ASSIGNMENT

Upon sale, assignment, lease, or other conveyance of its rights under this Agreement, Crandon Mining Company shall be released automatically from its obligations under this Agreement if

1. the successor to CMC's interests assumes all of CMC's obligations under this Agreement; and
2. CMC is released by the DNR from its duties, pursuant to Wis. Stat. 144.87(2).

Page 31

TERM

This Agreement shall be in effect from the date it is signed by both parties until the first to occur of the following events:

1. CMC withdraws its application for the Mining Permit and gives written notice to Forest County that it is terminating this Agreement;
2. A local, state or federal approval or permit necessary to the mine is denied and such denial becomes final and unreviewable; or
3. After permits are issued but before CMC begins construction of the mine, CMC decides not to begin construction and gives written notice to Forest County that it is terminating this agreement; or
4. The end of the Reclamation Period.

Page 32

NOTICES

Notices required by this Agreement shall be given by Certified Mail, Return Receipt Requested, addressed, in the case of Forest County, to:

Clerk
Forest County
Forest County Courthouse
200 East Madison Street
Crandon, Wisconsin 54520-1414

and in the case of Crandon Mining Company, to:

President
Crandon Mining Company
104 West Madison Street
Crandon, Wisconsin 54520-0336

or to such other address as either party may hereafter set out in writing to the other.

Page 33

BINDING EFFECT

This Agreement represents the entire agreement between the parties and supercedes all prior written and oral negotiations, representations or agreements. This Agreement may be amended only by a writing designated as an amendment to this Agreement and executed by the parties.

Page 34

CONSTRUCTION

This Agreement was drafted with the assistance of counsel for each party and shall not be construed in favor of, or against, either party. The titles of sections of this Agreement are included for convenience only and are not part of this Agreement.

Page 35

SEVERABILITY

Whenever possible, each paragraph of this Agreement shall be interpreted so as to be effective and valid under applicable law. However, if any provision is held to be prohibited or invalid, that provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the other remaining provisions of this agreement.

Page 36

ATTACHMEENT "A"

SCHEDULE A-1

Permits Granted
$2,000,000.00 over 15 year period


December 1, 1996		$133,333.34
December 1, 1997		$133,333.34
December 1, 1998		$133,333.34
December 1, 1999		$133,333.34
December 1, 2000		$133,333.34
December 1, 2001		$133,333.33
December 1, 2002		$133,333.33
December 1, 2003		$133,333.33
December 1, 2004		$133,333.33
December 1, 2005		$133,333.33
December 1, 2006		$133,333.33
December 1, 2007		$133,333.33
December 1, 2008		$133,333.33
December 1, 2009		$133,333.33
December 1, 2010		$133,333.33
SCHEDULE A-2

Permits Not Granted
$2,500,000.00 over 15 year period

December 1, 1996		$133,333.34
December 1, 1997		$133,333.34
December 1, 1998		$133,333.34
December 1, 1999		$133,333.34
December 1, 2000		$133,333.34
December 1, 2001		$183,333.33
December 1, 2002		$183,333.33
December 1, 2003		$183,333.33
December 1, 2004		$183,333.33
December 1, 2005		$183,333.33
December 1, 2006		$183,333.33
December 1, 2007		$183,333.33
December 1, 2008		$183,333.33
December 1, 2009		$183,333.33
December 1, 2010		$183,333.33
ATTACHMENT "B"

Schedule B-1

Permits Granted
$1,500,000.00 over 15 year period

December 1, 1996		$100,000.00
December 1, 1997		$100,000.00
December 1, 1998		$100,000.00
December 1, 1999		$100,000.00
December 1, 2000		$100,000.00
December 1, 2001		$100,000.00
December 1, 2002		$100,000.00
December 1, 2003		$100,000.00
December 1, 2004		$100,000.00
December 1, 2005		$100,000.00
December 1, 2006		$100,000.00
December 1, 2007		$100,000.00
December 1, 2008		$100,000.00
December 1, 2009		$100,000.00
December 1, 2010		$100,000.00
SCHEDULE B-2

Permits Not Granted
$2,000,000.00 over 15 year period

December 1, 1996		$100,000.00
December 1, 1997		$100,000.00
December 1, 1998		$100,000.00
December 1, 1999		$100,000.00
December 1, 2000		$100,000.00
December 1, 2001		$150,000.00
December 1, 2002		$150,000.00
December 1, 2003		$150,000.00
December 1, 2004		$150,000.00
December 1, 2005		$150,000.00
December 1, 2006		$150,000.00
December 1, 2007		$150,000.00
December 1, 2008		$150,000.00
December 1, 2009		$150,000.00
December 1, 2010		$150,000.00
Topographic Map of Crandon Mining Company
Figure 2-2
PROJECT AREA

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