Exhibit 10.1. Agreement with
Platoro West
AGREEMENT
This Agreement made as of the 27th day of
June, 2005.
BETWEEN:
Pilot Mountain Resources Inc., a
corporation incorporated pursuant to the laws of the State of
Nevada (herein called “PMR”) and a wholly-owned
subsidiary of Pacific Gold Corp., a Nevada corporation
(“Pacific Gold”) and Platoro West Incorporated, a
corporation incorporated pursuant to the laws of the State of
Nevada (herein called “Platoro”).
WHEREAS, Platoro has represented to PMR
that Platoro owns certain mining claims likely to contain high
concentrations of minerals including without limiting the
generality of the foregoing, tungsten.
NOW, THEREFORE, THIS AGREEMENT WITNESSES
that in consideration of the respective covenants and agreements of
the parties contained herein and other good and valuable
consideration (the receipt and sufficiency of which is hereby
acknowledged by each of the parties hereto), it is agreed as
follows:
INTERPRETATION
In this Agreement,
unless the context otherwise requires:
“Agreement”
means this agreement, including any and all Schedules attached or
to be attached, as amended from time to time in accordance with its
terms;
“Business
Day” means every day except Saturday, Sunday or a day which
is a statutory holiday under the laws of the State of
Nevada;
“Encumbrance” means any
mortgage, lien, pledge, charge, security interest, restriction,
claim, encumbrance, right to use or acquire, ownership interest or
demand of any nature whatsoever;
“Gross
Royalty” means an amount equal to two (2%) percent of the
actual proceeds of the sale of Valuable Minerals derived from the
development and production of Subject Mining Claims actually
received in cash by PMR or its assignees from the sale thereof from
a smelter or refinery;
“Mining
Claim” means a parcel of land, including land under water,
that can be or has been staked and recorded;
“Subject Mining
Claim” means a Mining Claim that Platoro owns the rights to
that is subject to the terms of this Agreement or that PMR owns as
a result of transfer from Platoro to PMR under this Agreement
and/or listed on Schedule A hereto;
“Person”
includes an individual, partnership, unincorporated association,
organization, syndicate, corporation, trust and a trustee,
executor, administrator or other legal or personal
representative;
“Valuable
Minerals” means mines, ore, concentrates, bullion, minerals,
including without limiting the generality of the foregoing,
tungsten, gold, silver and all rare and precious metals and/or
other products located in, on or under Subject Mining
Claims;
In this
Agreement:
words denoting the singular include the
plural and vice versa and words denoting any gender include both
genders;
any reference to a statute shall be the
statute in force on the date hereof, unless otherwise expressly
provided;
the use of headings is for convenience of
reference only and shall not affect the construction of this
Agreement;
when calculating the period of time
within which or following which any act is to be done or steps
taken, the date which is the reference day in calculating such
period shall be excluded. If the last day of such period is
not a Business Day, the period shall end on the next Business Day;
and
all dollar amounts are expressed in
United States of America funds unless stated otherwise;
COVENANTS OF
PLATORO
Platoro agrees to
identify in consultation with PMR certain Mining Claims that have
the potential to have tungsten mineralizations therein, which shall
then be identified as Subject Mining Claims and listed on Schedule
A hereto.
Platoro covenants and
agrees to do all things reasonably required to cause the Subject
Mining Claims to be staked out and registered in its name, if not
already staked and registered in its name, to be held for itself
and no others, and to cause all legal steps required pursuant to
the laws of any state of the United States and the laws of the
United States for the Subject Mining Claims to be filed, registered
and recorded in all public records in the name of Platoro and no
others.
Platoro hereby grants a
license to PMR to enter upon the Subject Mining Claims for the
purpose of performing testing, sampling and geological studies, for
the purpose of completing feasibility studies and developing a Plan
of Operations. Such license shall extend to all agents,
consultants, employees and others engaged by PMR in any capacity to
enter upon and perform the above. PMR shall be responsible
for obtaining any permits necessary for any testing, sampling and
geological studies and will be responsible for reclamation and
other expenses associated therewith. In connection with the
license hereby granted, Platoro agrees to provide to PMR such
information and data in the possession or control of Platoro
relating to the Subject Mining Claims as is requested by PMR,
together with copies of documents in the possession or control of
Platoro
relating thereto
(including without limiting the generality of the foregoing, all
maps, file contents, geological, engineering, environmental and
metallurgical data and information).
The Subject Mining
Claims filed, registered and recorded by Platoro pursuant to
Section 2.1, shall be transferred and filed, registered and
recorded in the name of PMR as the sole and absolute owner thereof,
at the request of PMR as to which Subject Mining Claims and when,
at any time after PMR either (i) completes a feasibility study for
such Subject Mining Claims using a consultant on whom both PMR and
Platoro reasonably agree or (ii) is approved for a Plan of
Operations with the relevant authorities which plan (a) calls for
not less than 500 tons per day of mining or (b) has the approval of
Platoro which approval will not be unreasonably withheld so long as
it represents substantial mining efforts by PMR. Upon the written
request for transfer to PMR of the sole and absolute ownership of
some or all the Subject Mining Claims by PMR, time being of the
essence, and in no event later than 30 days after the date of
notice, Platoro will take all such action as may be required or
necessary to transfer the Subject Mining Claims that are subject to
a feasibility study or Plan of Operations to PMR, and assure that
they are properly and fully filed, registered and recorded in the
name of PMR as sole and absolute owner. Upon the transfer of
the Mining Claims to PMR pursuant to this provision, the Mining
Claims will become the sole property of PMR, and Platoro will not
contest or otherwise seek any ownership interest in the Subject
Mining Claims. Notwithstanding the provisions of Sections
3.1.1 and 3.1.2, from and after the date of request of the transfer
of the Subject Mining Clams to PMR, Platoro will have only the
right to receive the Gross Royalty in respect of those Subject
Mining Claims transferred to PMR as provided in Section 3.1.3 and
retain any issuance of shares and prepayments of the Gross Royalty
paid as of the date of such notice of transfer.
Immediately following completion of the
obligations set forth in Sections 2.4, Platoro shall provide PMR
with the following:
complete particulars as to the precise
location of the Mining Claims and Subject Mining Claims so located,
staked out and recorded;
evidence, satisfactory to PMR and its
counsel, acting reasonably, that Sections 2.1 through 2.3, have
been complied with and satisfied; and
such information and data in the
possession or control of Platoro relating to the Subject Mining
Claims, together with such documents in the possession or control
of Platoro relating thereto (including without limiting the
generality of the foregoing, all maps, file contents, geological,
engineering, environmental and metallurgical data and
information).
In the event of a breach
of this Agreement by PMR, Platoro agrees that it will not have any
rights in any of the Subject Mining Claims that have been
transferred to PMR, other than those of a general creditor of the
company.
COVENANTS OF
PMR
PMR covenants and agrees
as follows:
It will cause its parent, Pacific Gold,
to issue to Platoro 150,000 shares of common stock of Pacific Gold
(“Shares”), which shares will be unregistered and
“restricted stock” as
that term is defined in Rule 144 under
the Securities Act of 1933, such shares to be issued within 15 days
of the execution of this Agreement, which shares are being received
as an investment and not with a view towards their
distribution;
to pay to Platoro the following
pre-payments of the Gross Royalty on the dates specified
below:
|
$5,000
|
Due
and payable on the first through the fourth anniversaries of the
date of this Agreement
|
|
$10,000
|
Due
and payable on the fifth and sixth anniversaries of the date of
this Agreement
|
|
$20,000
|
Due
and payable on the seventh through the tenth anniversaries of this
Agreement.
|
|
$40,000
|
Due
and payable on the eleventh anniversary of this Agreement and each
anniversary of the Agreement thereafter until the parties mutually
agree to terminate this Agreement if not previously terminated by
PMR.
|
Each of the above
specified payments, once paid, shall be non-refundable by Platoro
to PMR;
to pay to Platoro a Gross Royalty of 2%
during the term of this Agreement, the Gross Royalty payment to be
made to Platoro not later than 30 Business Days after receipt of
payment for any Valuable Minerals sold by PMR; and
to reimburse or otherwise pay Platoro all
yearly claims fees for both US Federal and state entities in
respect of the Subject Mining Claims, commencing with the fees due
the Bureau of La