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Asset Purchase Agreement
THIS AGREEMENT dated the ____ day of November, 2007 .
BETWEEN:
OF THE FIRST PART
AND :
OF THE SECOND PART
WHEREAS:
A. The Vendor is the registered and beneficial
owner of various mineral claims (hereinafter the " Claims
"), comprising 80 claims in ten Townships for a total of 99,240
hectares. The Claims of the Vendor are more particularly described
in Schedule "A" attached hereto and forming part of this
Agreement;
B. The Vendor has agreed to sell and the
Purchaser has agreed to purchase all of the Claims of the Vendor in
accordance with the terms of this Agreement.
NOW THEREFORE THIS AGREEMENT WITNESSES
that in consideration of the terms and covenants herein and other
good and valuable consideration, the receipt and sufficiency of
which each party acknowledges, the parties hereto agree as
follows:
1. PURCHASE AND SALE OF ASSETS
1.1 Sale of Assets . Subject to the terms
and conditions of this Agreement, the Vendor hereby sells, assigns
and transfers to the Purchaser, and the Purchaser hereby purchases
the Vendor's Claims.
1.2 Purchase Price . The purchase price
payable by the Purchaser to the Vendor for the Vendor's Claims
shall consist of: a) a total of 10,000,000 shares of common stock
of the Purchaser at par value of $0.001 per share (the "
Shares "); b ) $500,000 USD (the " Purchase
Price "); and c) a carried 3% Net Smelter Royalty.
1.3 Payment Schedule. The Payment
Schedule shall be as follows:
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(a) The Purchaser shall issue and deliver the
Shares, fully paid and non-assessable, in conjunction with and at
the same time as the payment of the purchase price installments, in
ten installments consisting of one million (1,000,000) Shares
each.
(b) The Purchaser shall pay the Purchase Price
in ten installments of $50,000 each, on or before June 30, 2008
(each payment of Purchase Price and transfer of an installment of
Shares shall be referred to as an "Installment "). Vendor
acknowledges that Purchaser must raise the cash through the sale of
common stock of the Purchaser.
1.4 Delivery and Transfer of Claims. Upon
the payment of each of the ten Installments, the Vendor shall
deliver to the Purchaser, one-tenth of the of the total number of
the Claims unconditionally and free and clear of all liens,
charges, or encumbrances, except where disclosed. As each
Installment is paid by the Purchaser to the Vendor, the Vendor
shall transfer those Claims represented by a single Township,
commencing with Township 49, and continuing in consecutive order
until all the Installments have been paid by the Purchaser to the
Vendor, and all of the Claims represented by each Township have
been transferred by the Vendor to the Purchaser. The Purchaser
shall be responsible for the cost of transferring the Claims. Each
payment of an Installment and subsequent transfer of all the Claims
represented by a Township shall constitute a single Closing
hereunder. Each Closing shall take place at such time and place as
the Parties hereto shall mutually agree with the final Closing to
occur on or before June 28, 2008.
2. COVENANTS of the
Parties
2.1 Covenants . The parties undertake to
keep the information with respect to this Agreement, the terms
herein, and any related, underlying or subsequent agreements (the "
Information ") confidential and not to directly or
indirectly disclose the Information at any time to any person or
persons or use the Information for any purpose whatsoever.
3. REPRESENTATIONS OF THE
VENDOR
3.1 Representations. The Vendor
represents and warrants to the Purchaser as follows, with the
intent that the Purchaser will rely on the representations in
entering into this Agreement, and in concluding the purchase and
sale contemplated by this Agreement:
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(a) Capacity to Sell . The Vendor has the
power and capacity to own and dispose of the Claims, and to enter
into this Agreement and carry out its terms to the full extent;
(b) Authority to Sell . The execution and
delivery of this Agreement, and the completion of the transaction
contemplated by this Agreement has been duly and validly authorized
by all necessary corporate action on the part of the Vendor, and
this Agreement constitutes a legal, valid and binding obligation of
the Vendor enforceable against the Vendor in accordance with its
terms except as may be limited by laws of general application
affecting the rights of creditors;
(c) Sale Will Not Cause Default. Neither
the execution nor delivery of this Agreement, nor the completion of
the purchase and sale contemplated by this Agreement will:
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(i) violate any of the terms and provisions of
the constating documents or bylaws or articles of the Vendor, or
any order, decree, statute, bylaw, regulation, covenant,
restriction applicable to the Vendor or the Claims;
give any person the right to terminate, cancel
or otherwise deal with the Claims; or
(iii) result in any fees, duties, taxes,
assessments or other amounts relating to the Claims becoming due or
payable other than any tax payable by the Purchaser in connection
with the purchase and sale and set forth in Schedule
3.1(c)(iii);
(d) Encumbrances . The Vendor owns and
possesses and has a good marketable title to the Claims free and
clear of all legal claims, mortgages, liens, charges, pledges,
security interest, encumbrances or other claims except as disclosed
on Schedule 3.1(d);
(e) Litigation . There is no litigation
or administrative or governmental proceeding or inquiry pending or,
to the knowledge of the Vendor, threatened against or relating to
the Claims, nor does the Vendor know of or have reasonable grounds
that there is any basis for any such action, proceeding or
inquiry;
(f) No Defaults . Except as otherwise
expressly disclosed in this Agreement there has not been any
default in any obligation to be performed under any of the Claims,
which are in good standing and in full force and appropriate
effect;
(g) Compliance with Laws . Vendor
has held, and continues to hold, the Claims in compliance with all
applicable laws including but not limited to all applicable land
use and environmental laws and the Claims are valid for the use
contemplated therefore; and
(h) Good Standing . Prior to closing this
Agreement, the Vendor will maintain, as required, the Claims in
good standing.
4. COVENANTS OF THE VENDOR
4.1 Procure Consents . The Vendor will
diligently and expeditiously take all steps necessary to and will
obtain all necessary consents and shall file all regulatory filings
necessary to effect the transfer of the Claims.
4.2 Covenant of Indemnity . The Vendor
will indemnify and hold harmless the Purchaser from and
against:
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(a) any and all liabilities, whether known,
unknown, accrued, absolute, contingent or otherwise, existing at
Closing which arise out of Vendor's ownership of the Claims and
operation of its business prior to Closing and which are not agreed
to be assumed by the Purchaser under this Agreement;
(b) any and all losses, claims, damages and
costs incurred or suffered by the Purchaser arising out of the
breach or inaccuracy of any representation or warranty of the
Vendor contained in this Agreement; and
(c) any and all actions, suits, proceedings,
demands, assessments, judgments, costs and legal and other expenses
incident to any of the foregoing.
4.3 Execution of all necessary documents.
The Vendor will execute all necessary documents including such
assignments as the Purchaser may require to effect the transfer of
all of the Claims.
5. REPRESENTATIONS OF THE PURCHASER
5.1 Representations . The Purchaser
represents and warrants to the Vendor as follows, with the intent
that the Vendor will rely on these representations and warranties
in entering into this Agre
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