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ASSIGNMENT OF INTEREST IN JOINT VENTURE
AGREEMENT
THIS AGREEMENT is entered into this 3rd day of March, 2005, by
and
between Caldera Partners Limited Partnership, a Washington
limited partnership
("Caldera"), and LKA International, Inc., a Delaware corporation
("LKA").
WHEREAS, in December, 1982, the Company's wholly-owned
subsidiary, LKA
International, Inc., a Nevada corporation ("LKA Nevada"),
entered into a Joint
Venture Agreement with Lake City Mines, Inc., a Colorado
corporation, by which
LKA Nevada acquired a 51% interest in the proceeds and benefits
derived from
the Ute-Ule and Golden Wonder mining properties located in Lake
City, Colorado
(collectively, the "Properties");
WHEREAS, immediately after the execution of the Joint Venture
Agreement,
LKA Nevada assigned to Caldera 90% of its interest in the
Properties
thereunder, such that Caldera currently owns a 45.9% interest in
the proceeds
and benefits derived from the Properties;
WHEREAS, on December 15, 1993, LKA Nevada acquired all of Lake
City
Mines' interests in the Properties pursuant to a Sheriff's Deed,
with the
result that LKA Nevada currently owns a 54.1% interest in the
Properties and
Caldera currently owns a 45.9% interest therein;
WHEREAS, the holders of approximately 67.4% of the partnership
interests
in Caldera have voted in favor of Caldera's assignment of all of
its interest
in the Properties to LKA in consideration of LKA's issuance of
6,434,042
"unregistered" and "restricted" shares of its common stock to
Caldera ; and
WHEREAS, such vote is sufficient under its Limited Partnership
Agreement
to enable Caldera to proceed with the proposed assignment;
NOW, THEREFORE, the parties hereby agree as follows:
1. Assignment of Interest in Golden Wonder Property. Caldera
hereby
assigns all of its interest in the proceeds and benefits derived
from the
Properties to LKA.
2. Issuance of LKA common stock. In consideration of the
above
assignment, LKA hereby agrees to issue to Caldera 6,434,042
"unregistered" and
"restricted" shares of its common stock (the "Common
Stock").
3. Representations and Warranties of Caldera. Caldera hereby
represents and warrants as follows:
A. It is a limited partnership duly organized and in good
standing in the State of Washington, has full power and
authority to
execute and deliver this Agreement, without qualification, and
has
obtained all approvals and consents that are required for it
to
enter into this Agreement;
B. Neither the execution and delivery of this Agreement nor
the
consummation or performance of any of the transactions
contemplated
hereby will, directly or indirectly (with or without notice or
lapse
of time):
(i) Breach any provision of any of its governing documents;
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(ii) Breach or give any governmental body or other entity the
right to
challenge the contemplated transactions or to exercise any
remedy or
obtain any relief under any legal requirement or any order to
which
Caldera or either of the Properties may be subject;
(iii) contravene, conflict with or result in a violation or
breach of
any of the terms or requirements of, or give any governmental
body the
right to revoke, withdraw, suspend, cancel, terminate or modify,
any
governmental authorization that is held by Caldera or that
otherwise
relates to the Properties;
(iv) Breach any provision of, or give any entity the right to
declare a
default or exercise any remedy under, or to accelerate the
maturity or
performance of, or payment under, or to cancel, terminate or
modify, any
contract by which Caldera or either of the Properties is or may
become
bound; or
(v) result in the imposition or creation of any encumbrance upon
or with
respect to either of the Properties.
C. Caldera is not required to give any notice to or obtain
any
consent from any entity in connection with the execution and
delivery of this Agreement or the consummation or performance of
any
of the transactions contemplated hereby.
D. Caldera's interest in the Properties is free and clear of
any
encumbrances.
E. There is no pending or, to Caldera's knowledge,
threatened
proceeding
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