THIS LOAN
AGREEMENT, made as
of the 30 th
day of April, 2009, but having an
effective date of January 21, 2009.
AMR
PROJECT PERU, S.A.C. , a company incorporated under the laws of Peru
and having an address for notice and delivery located at Av.
Arenales 335, Cercado, Lima, Peru
OF THE FIRST PART
AFFINITY
GOLD CORP. , a
company incorporated under the laws of the Sate of Nevada and
having an address for notice and delivery located at 7950 Main
Street, Suite #217, Maple Grove, MN 55369
OF THE SECOND PART
A. The
Lender has agreed to loan to the Company up to the principal amount
of US Four Hundred Thousand dollars (US$400,000) in installments on
the terms and conditions set forth in this Agreement for the
purposes of financing the Company with such funds being used to
purchase equipment and supplies and to conduct exploration and
other related expenses on the mining concession named “AMR
Project” covering 500 hectares and the physical mining
concession certificate as evidenced by Certificate No.
7996-2006-INACC-UADA granted to the Company by the Republic of
Peru, National Institute of Concessions and Mining Cadastre on
December 11, 2006.
B. The
Lender and the Company have entered into an Amendment Agreement,
whereby the parties have agreed to change the structure of the
prior arrangement between the parties from an asset purchase
agreement to a share exchange agreement which will result in the
Company becoming a wholly owned subsidiary of the Lender upon
closing of the share exchange agreement.
C. Upon
the completion of the share exchange agreement between the Lender
and the Company, the loan from the Lender to the Company will
become an inter-corporate loan. However, if the share
exchange agreement between the Lender and the Company is not
completed, then the loan from the Lender to the Company will be due
in accordance with the terms and conditions set forth in this
Agreement.
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NOW
THEREFORE IN CONSIDERATION of the mutual agreements herein contained, the
parties hereto agree as follows:
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Loan. The Lender hereby agrees to loan to the Company
at its request and in accordance with its instructions as to where
funds are to be sent, and on the terms and conditions contained
herein, up to the aggregate principal sum of U.S. FOUR HUNDRED
THOUSAND dollars (US$400,000) (the “ Loan ”) by
transferring funds in installments as requested by the Company
within five days or earlier up to the aggregate amount of
US$400,000.
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Interest
Rate. The
Loan will not bear any interest on the outstanding principal
amount.
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Repayment of
the Loan. The
Loan will be due and payable one year from the date of this
Agreement. However, if the Lender becomes the owner of
the Company through the Lender’s acquisition of all the
outstanding capital of the Company, then such Loan will be treated
as an inter-corporate loan and dealt with as the respective Board
of Directors of the inter-related companies shall determine and/or
shall be dealt with in such other manner mutually agreed by the
parties.
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Representations and Warranties of the
Company. To
induce th
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