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Simple English definitions for legal terms
grubstake contract
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A quick definition of grubstake contract:
A grubstake contract is an agreement between two or more parties that creates obligations that can be enforced by law. It can be a written document or a verbal agreement. The term "contract" can refer to the agreement itself or the physical document that contains the terms of the agreement. In simple terms, a contract is a promise that the law recognizes as a duty, and if that promise is broken, there will be consequences.
A more thorough explanation:
A grubstake contract is a type of contract that creates obligations between two or more parties that are enforceable by law. It is a written agreement that sets forth the terms and conditions of the agreement.
For example, a miner may enter into a grubstake contract with an investor. The miner agrees to search for minerals and the investor agrees to provide the necessary funds for the miner to do so. If the miner finds minerals, the investor will receive a portion of the profits.
This type of contract is commonly used in the mining industry, where investors provide funding to miners in exchange for a share of the profits. The contract outlines the responsibilities of each party and the terms of the agreement, including how profits will be divided.