EXHIBIT 10.4
Raven Gold Corp.
May 30, 2006
Mr. Francis R. Biscan Jr.
President & CEO
Tara Gold Resources Corp
Re: Joint Venture Agreement on the La Currita
Groupings, near Temoris, Chihuahua, Mexico between Amermin S.A. de
C.V., a 97% owned subsidiary of Tara Gold Resources Corp. (Tara)
and Raven Gold Corp. (RAVEN) in trust for a Mexican subsidiary to
be created at a later date. The La Currita Groupings are
approximately 192 acres and are known as Sulema 2, El Rosario, La
Curra, and La Currita (Head of group).
Dear Mr. Biscan;
We are pleased to present the following
terms regarding the La Currita Groupings.
Terms:
1.
Upon the signing of this Agreement, RAVEN
agrees to purchase 25% of Tara’s interests in the La Currita
Groupings by completing the following;
a)
Make a non-refundable payment of
US$75,000.00, coinciding with the signing of this Agreement (the
payment will be refundable if a satisfactory title search is not
secured by RAVEN from Tara by August 17, 2006);
b)
Make a payment of US$125,000.00 by August
17, 2006;
c)
Make a payment of US$150,000.00 by
October 17, 2006;
d)
Make a payment of US$300,000.00 by
December 17, 2006; and
e)
RAVEN must issue to Tara 250,000 Rule 144
restricted common shares
Upon signing of this Agreement, Tara
agrees to:
a)
Make available a certified copy of title
for the La Currita Groupings as soon as one is received or no later
then August 17, 2006.
2.
RAVEN agrees to make all property
payments and any other payments deemed necessary to maintain the
properties and keep in good standing the full interest in the La
Currita Groupings and continue to make these payments as long as
the Joint Venture outlined in this agreement is in effect. Payments
will be escrowed for payment at least 14 days before payment is
due.
3.
RAVEN will make an additional payment of
US $100,000.00 on every anniversary date of this agreement to
maintain its interests earned, and to keep the Joint Venture in
good standing.
4.
On a monthly basis, the net operating
revenue derived from La Currita will be distributed at the interest
level earned, according to the overall terms of this agreement, by
each party on the last day of the month during which the revenue
was generated.
5.
Raven will have the right to invest up to
a maximum of $500,000.00 Start-Up Capital, which is unrelated to
any payments or expenditures within this agreement, under special
terms. Whereby the investment will be paid back out of net
operating revenue at a rate higher then the current interest
earned. On a monthly basis, 60% of the net operating revenue
derived from La Currita, will be set aside and credited or paid out
to Raven towards recovery of the Start-Up Capital investment by
Raven. The remainder of the net operating revenue derived from La
Currita, during the recovery of the Start-Up Capital phase, will be
distributed to Tara. Once the full amount of the Start-Up
Capital has been recovered from the 60% set aside, the revenue
sharing will revert back to the interest that has been earned
according to the overall terms of this agreement.
6.
RAVEN may increase its interest in the La
Currita project to 40% thereby reducing Tara's interest in the La
Currita Groupings to 60%, after first notifying Tara of
RAVEN’s intentions and after the following conditions have
been met:
a.
RAVEN spends an additional US$1.0
million, over and above the Start-Up Capital, on exploration and
development within 18 months of the date this agreement is signed.
Tara agrees that RAVEN will be the operator overseeing the
additional US$1.0 million expenditure; however, Tara may have it
representatives on location at any and all times to observe all
operations, and may audit expenditures as necessary;
b.
RAVEN will supply the expertise and
expenditures, within the amount outlined in 6)a., necessary
to achieve monthly production at the La Currita Processing Plant of
4,500 tons per month for 3 consecutive months and maintain ongoing
production of a minimum of 4,000 tons per month;
c.
Once RAVEN has notified Tara in writing,
along with supporting documents, that it has spent US$1.0 million
in exploration work on La Currita, the Joint Venture Partners agree
to enter into a standard joint venture agreement by which it will
have a 40% working interest in the La Currita Groupings and Tara
will own a 60% interest. At this point, RAVEN is to be appointed
operator of the joint venture and will remain the operator as long
as it maintains it’s 40% participation in the joint venture
by paying all property payments and it’s proportionate share
of expenses or decides to withdraw from such responsibility;
and
d.
RAVEN issues to Tara an additional
250,000 Rule 144 restricted common shares at notification to
increase its interest.
7.
A standard dilution clause will apply in
case one of the partners decides not to participate financially for
its proportionate share in any exploration or development program
submitted by the operator. Should the operator decide not to
present any exploration or
2
development programs, the other party can
present one and become the operator.
As a basis for the dilution clause, each
party will be deemed to have invested the following amount of money
in the La Currita Groupings:
1
RAVEN: US$1,600,000 (representing its 40%
interest); and
2
Tara: US$2,400,000 (representing its 60%
interest).
Once a participant has been diluted to a
10% interest, this interest will automatically convert into a 3%
N.S.R. and the joint venture agreement will become null and void.
For a period of no longer then 1 year, the majority party will have
the option to reduce the 3% NSR to 1% in exchange for a
US$2,000,000 payment;
8.
Each party, as long as their original
participation is maintained, will have one vote each in the
decisions of the joint venture management committee. An arbitration
clause will be included in case of disagreement;
9.
It is also agreed that RAVEN has an
option to increase its interest in the La Currita Groupings to 60%
thereby reducing Tara's interest in the La Currita Groupings to
40%, on the following conditions:
a.
RAVEN spends an additional US$2.5 million
over and above the US$1.0 million expenditures outlined in 6(a)
above on exploration and development within 36 months of the date
this agreement is signed. Tara agrees that RAVEN will remain as
operator overseeing the US$2.5 million expenditure; however, Tara
may have it representatives on location at any and all times to
observe all operations, and may audit expenditures by RAVEN as
necessary;
b.
RAVEN will supply the expertise and
expenditures, within the amount outlined in 9)a., necessary to
achieve monthly production at the La Currita Processing Plant of
9,000 tons per month for 3 consecutive months and maint
