Exhibit 10.01
THIS AGREEMENT made and dated for reference the 30th day of April, 2009.
BETWEEN:
YALE RESOURCES LTD., a body corporate, incorporated under the laws of
the Province of British Columbia, having an office at # 000 - 000
Xxxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxx Xxxxxxxx, X0X 0X0; and its
subsidiaries, including XXXXXX XXXX VISTA SA DE CV, a Mexican company
(hereinafter collectively called the "Optionor")
AND:
AMERICAN SIERRA GOLD CORP., a body corporate, incorporated under the
laws of the State of Nevada, having its Records and Registered Office
at 000 Xxxxxx Xxxxx, Xxxxx Xxxxxxx, Xxxxxxx, XX.; and its future
subsidiary, a Mexican company;
(hereinafter called the "Optionee")
WHEREAS:
A. The Optionor has entered in to an Purchase Agreement with EXMIN Resources
Inc. (the Vendor), the recorded and beneficial owner of a 100% interest in a
total of ten (10) mining concessions owned by the Vendor (the "OWNED
CONCESSIONS") covering approximately 28,830 hectares in south-west Chihuahua
State, Mexico, which Owned Concessions are more particularly described in
SCHEDULE "A" annexed hereto and forming a part hereof and, which Vendor also
holds options to acquire an additional six (6) mining concessions covering
approximately 276 hectares (the "OPTIONED CONCESSIONS") full particulars of
which are set out in SCHEDULE "A" attached hereto;
B. The Owned Concessions and the Optioned Concessions are hereafter referred to
as the "PROPERTY";
C. Upon the closing of the Purchase Agreement with the Vendor, the Optionor has
agreed to grant to the Optionee options entitling the Optionee to acquire
certain legal and beneficial interests in and to the Property as provided for in
this Agreement, and to participate in the further exploration and, if deemed
warranted, the development of the Property;
NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of these presents
and the sum of TEN DOLLARS ($10.00) now paid by each of the parties to each of
the other parties hereto, the receipt and sufficiency of which is hereby
acknowledged by each of the parties, and for other good and valuable
consideration, the receipt and sufficiency of which is also hereby acknowledged
by each of the parties, the parties hereby agree as follows:
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DEFINITIONS
1.01 In this Agreement and in all Schedules attached to and made a part hereof,
the following words and phrases shall have the following meanings, namely:
(a) "BUSINESS DAY" means any day other than Saturdays, Sundays and
statutory holidays in the Province of British Columbia;
(b) "CONDITIONS OF EXERCISE" has the meaning set out in paragraph 4.02
hereof;
(c) "EFFECTIVE DATE" means the date this Agreement is signed by the
Optionor and Optionee;
(d) "EXERCISE NOTICE" means a written notice to the Optionor, signed by
the Optionee, identifying a respective Option, indicating that the
Optionee has satisfied the respective Conditions of Exercise and is
irrevocably exercising that Option;
(e) "EXPENDITURES" means the sum of all monies spent in prospecting,
exploring, geological, geophysical and geochemical surveying,
sampling, examining, diamond and other types of drilling, developing,
dewatering, assaying, testing, constructing, maintaining and operating
roads, trails and bridges upon or across the Property, buildings,
equipment, plant and supplies, salaries and wages (including fringe
benefits) of employees and contractors directly engaged therein,
insurance premiums, and all other expenses ordinarily incurred in
prospecting, exploring and developing mining lands and also includes
monies spent in acquiring additional claims or concessions which shall
form part of the Property. Expenditures shall also include any tax
payments and legal costs and fees related to the registration of
titles and agreements in the Mexico Mining Registry together with any
value added taxes accruing after the date of this Agreement as well as
any of those costs related to the acquisition of properties from third
parties;
(f) "FIRST OPTION" has the meaning set out in sub-paragraph 4.01(a)
hereof;
(g) "FIRST OPTION DEADLINE" means the date that is four years after the
Effective Date, subject to paragraph 13.01 hereof;
(h) "HOLDCO" means the Mexican company to be established by the Optionee
to hold title to the Property;
(i) "OPTION DEADLINE" means either of the First Option Deadline or the
Second Option Deadline, as the case may be;
(j) "OPTIONS" collectively means the First Option and the Second Option,
and "OPTION" means either one of them;
(k) "PROPERTY" means all of the mining claims described in Schedule "A"
hereto in respect of which either of the Options remains in effect and
all other mineral property interests derived from any such mineral
claims. Any reference herein to any mineral claims or other mineral
property interests comprised in the Property includes any other
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interests into which such mining claims or other mineral property
interests may have been converted;
(l) "SECOND OPTION" has the meaning set out in sub-paragraph 4.01(b)
hereof;
(m) "SECOND OPTION DEADLINE" means the date that is five years after the
Effective Date, subject to paragraph 13.01 hereof;
(n) "THIS AGREEMENT" refers to and collectively includes this Agreement
and every Schedule attached to this Agreement.
REPRESENTATIONS AND WARRANTIES OF THE OPTIONOR
2.01 The Optionor represents and warrants to the Optionee that:
(a) It has been duly incorporated under the laws of the Province of
British Columbia, validly exists as a corporation in good standing
under the laws of the Province of British Columbia with respect to the
filing of annual reports and it and its Mexican subsidiary, Xxxxxx
Xxxx Vista SA de CV are legally entitled to hold their interest in the
Property and will remain so entitled until their interest in the
Property as set out herein has been duly transferred to the Optionee
as contemplated herein;
(b) it is, and at the time of any transfer to the Optionee of any interest
in the Property will be, the beneficial owner of the interest in the
Property so transferred free and clear of all liens, charges and
claims of others, and no taxes or rentals are due in respect thereof;
(c) to the best of its knowledge, the mining claims comprising the
Property have been duly and validly located pursuant to the laws of
Mexico and are recorded in the names set out on the attached Schedule
"A", and are in good standing as of Dec. 31, 2008 in the Mining Public
Registry of Mexico on the date hereof and until the dates set out on
the attached SCHEDULE "A";
(d) there is no adverse claim or challenge against or to the ownership of
or title to the Property, nor to its knowledge is there any basis
therefor, and there are no outstanding agreements or options to
acquire or purchase the Property or any portion thereof;
(e) to the best of its knowledge, there are no material outstanding
obligations or liabilities, contingent or otherwise, related to
environmental, reclamation or rehabilitation work associated with the
Property or arising out of exploration work, development work or
mining activities previously carried out thereon;
(f) the Optionor has duly obtained all corporate authorizations for the
execution of this Agreement and for the performance of this Agreement
by it, and the consummation of the transaction herein contemplated
will not conflict with or result in any breach of any covenants or
agreements contained in, or constitute a default under, or result in
the creation of any encumbrance under the provisions of, its Articles
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or constating documents or any shareholders' or directors' resolution,
indenture, agreement or other instrument whatsoever to which it is a
party or by which it is bound or to which it may be subject;
(g) no proceedings are pending for, and it is not aware of any basis for
the institution of any proceedings leading to, its dissolution or
winding-up or the placing of it in bankruptcy or subject to any laws
governing the affairs of insolvent persons; and
(h) there are no known royalties or other outstanding payments on the
Property other than the NSR interests that are set forth in SCHEDULE
"B".
2.02 The Optionor acknowledges that the representations and warranties set forth
in paragraph 2.01 hereof form a part of this Agreement and are conditions upon
which the Optionee has relied in entering into this Agreement, and that these
representations and warranties shall survive the acquisition of any interest in
the Property hereunder by the Optionee.
2.03 The parties also acknowledge and agree that the representations and
warranties set forth in paragraph 2.01 hereof are provided for the exclusive
benefit of the Optionee, and a breach of any one or more thereof may be waived
by the Optionee in whole or in part at any time without prejudice to its rights
in respect of any other breach of the same or any other representation or
warranty.
REPRESENTATIONS AND WARRANTIES OF THE OPTIONEE
3.01 The Optionee represents and warrants to the Optionor that:
(a) it has been duly incorporated under the laws of the State of Nevada,
validly exists as a corporation in good standing under the laws of the
State of Nevada with respect to the filing of annual reports;
(b) it is currently not legally entitled to hold mineral property
interests in the Country of Mexico and prior to or concurrently with
the exercise of the First Option will create and organize Holdco,
which will be legally entitled to hold mineral property interests in
the Country of Mexico;
(c) it has duly obtained all corporate authorizations for the execution of
this Agreement and for the performance of this Agreement by it, and
the consummation of the transaction herein contemplated will not
conflict with or result in any breach of any covenants or agreements
contained in, or constitute a default under, or result in the creation
of any encumbrance under the provisions of, its Articles or constating
documents or any shareholders' or directors' resolution, indenture,
agreement or other instrument whatsoever to which it is a party or by
which it is bound or to which it may be subject;
(d) no proceedings are pending for, and it is not aware of any basis for
the institution of any proceedings leading to, its dissolution or
winding-up or the placing of it in bankruptcy or subject to any laws
governing the affairs of insolvent persons.
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3.02 The Optionee acknowledges that the representations and warranties set forth
in paragraph 3.01 hereof form a part of this Agreement and are conditions upon
which the Optionor has relied in entering into this Agreement, and that these
representations and warranties shall survive the acquisition of any interest in
the Property hereunder by the Optionee.
3.03 The parties also acknowledge and agree that the representations and
warranties set forth in paragraph 3.01 hereof are provided for the exclusive
benefit of the Optionor, and a breach of any one or more thereof may be waived
by the Optionor in whole or in part at any time without prejudice to their
rights in respect of any other breach of the same or any other representation or
warranty.
GRANT OF OPTIONS AND COMMITMENTS
4.01 The Optionor hereby irrevocably grants to the Optionee two (2) exclusive
and separate rights and options to acquire undivided legal and beneficial
interests of up to ONE HUNDRED PER CENT (100%) in the Property free and clear of
all liens, charges and claims of others, as follows:
(a) an undivided NINETY PER CENT (90%) interest in the Property (the
"FIRST OPTION"); and
(b) an undivided TEN PER CENT (10%) interest in the Property, in addition
to the undivided NINETY PER CENT (90%) interest that may be acquired
under the First Option (the "SECOND OPTION").
4.02 The Optionee may exercise:
(a) the First Option by:
(i) making the following payments to the Optionor prior to the First
Option Deadline:
(1) THREE HUNDRED THOUSAND (US$300,000) DOLLARS U.S. before the
Effective Date (PAID);
A portion of this three hundred thousand (US$300,000)
dollars U.S. was advanced by the Optionee to the Optionor in
the form of a loan. For greater certainty, the documents
titled `Re: Bridge Loan' and `Promissory Note' dated
February 12, 2009 are superseded by this agreement and the
loan documents are cancelled.
(2) a further TWO HUNDRED AND FIFTY THOUSAND (US$250,000)
DOLLARS U.S. on the second anniversary of the Effective
Date;
(3) a further TWO HUNDRED AND FIFTY THOUSAND (US$250,000)
DOLLARS U.S. on the third anniversary of the Effective Date;
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(4) a further TWO HUNDRED AND FIFTY THOUSAND (US$250,000)
DOLLARS U.S. on the fourth anniversary of the Effective
Date;
(ii) incurring or funding the following Expenditures on the Property
as follows prior to the First Option Deadline:
(1) THREE HUNDRED THOUSAND (US$300,000.00) DOLLARS U.S. on or
before the first anniversary of the Effective Date, of which
$250,000 shall be deemed to have been incurred pursuant to
the payments made as per paragraph 4.02(a)(i)(1) hereof;
(2) an additional FIVE HUNDRED THOUSAND (US$500,000.00) DOLLARS
U.S. on or before the second anniversary of the Effective
Date;
(3) an additional EIGHT HUNDRED THOUSAND (US$800,000.00) DOLLARS
U.S. on or before the third anniversary of the Effective
Date; and
(4) an additional ONE MILLION (US$1,000,000.00) DOLLARS U.S. on
or before the fourth anniversary of the Effective Date;
(iii)making the following additional payments prior to the First
Option Deadline:
(1) ONE HUNDRED AND FIFTY THOUSAND (US$150,000.00) DOLLARS U.S.
on or before the first anniversary of the Effective Date on
the following schedule:
(a) US $50,000 upon successful completion of a National
Instrument 43-101 compliant technical report,
(b) US $50,000 upon Operator starting a drill program on
the Property before August 1, 2009, and
(c) US $50,000 upon the successful completion of the first
year work program before the 1st year anniversary of
the Effective Date;
(2) an additional SEVENTY THOUSAND (US$70,000.00) DOLLARS U.S.
on or before the second anniversary of the Effective Date;
(3) an additional SEVENTY THOUSAND (US$70,000.00) DOLLARS U.S.
on or before the third anniversary of the Effective Date;
and
(4) an additional SEVENTY THOUSAND (US$70,000.00) DOLLARS U.S.
on or before the fourth anniversary of the Effective Date;
At the election of the Optionor the additional payments 1b,
1c, 2, 3, and 4 may be converted into shares of the parent
company of American Sierra set at the price of the first
financing of the parent company.
(b) the Second Option, provided it has exercised the First Option, by
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(1) issuing to Yale an additional 500,000 shares of American Sierra
or the parent company of American Sierra,
(2) completing sufficient drilling in order to calculate a resource
estimation on or before the seventh anniversary of the Effective
Date, and
(3) paying US$0.75 to Yale per every equivalent ounce of Silver
within the Measured and Indicated categories as defined by JORC
(Joint Ore Reserves Committee);
(c) all of the above shares will be subject to a hold periods in
accordance with regulations under the SECURITIES ACT;
The Optionor understands and acknowledges that any shares which may be
issued to it pursuant to the provisions of this paragraph 4.02 must be
issued in reliance on exemptions from the prospectus and registration
requirements of applicable securities legislation and may be subject
to certain re-sale restrictions under such legislation, the terms of
which may be endorsed on the certificates representing such shares,
and prior to issuance the Optionor agrees to provide confirmation of
the availability of such exemptions and comply with such re-sale
restrictions.
(collectively, the "CONDITIONS OF EXERCISE").
4.03 If the Optionee, by the respective Option Deadline, fails to incur the
total amount of any of the Expenditures required under the respective Conditions
of Exercise, then the Optionee may pay to the Optionor an amount equal to such
shortfall in Expenditures within 30 (thirty) days after the respective Option
Deadline. Any payment so made shall be deemed to be Expenditures duly and
properly incurred for the purposes of the Conditions of Exercise.
4.04 If the amount of Expenditures incurred at any time exceeds the Expenditures
required under the respective Conditions of Exercise of the unexercised Option
next due to expire, then such excess shall be credited to the following years
commitment and, in the event the First Option is exercised, then to the Second
Option Expenditures.
4.05 Nothing in this Agreement shall be construed as obligating the Optionee to
exercise either of the Options or, subject to sub-paragraph 10.04(a) hereof,
incur any Expenditures on the Property.
4.06 In the event the Optionee has satisfied the respective Conditions of
Exercise and wishes to exercise an Option, then to do so it must, prior to the
respective Option Deadline, deliver to the Optionor an Exercise Notice. On
delivery of an Exercise Notice the Optionor shall be deemed to have transferred
to the Optionee the following undivided equitable interests in the Property as
tenants in common:
(a) in the case of the First Option, a NINETY PER CENT (90%) interest
shall be held by the Optionee and a TEN PER CENT (10%) carried
interest held by the Optionor; and
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(b) in the case of the Second Option, a TEN PER CENT (10%) interest, in
which event the Optionor will have no further interest in the
Property.
4.07 Subject to paragraphs 4.03 and 10.02 hereof, in the event the respective
Conditions of Exercise in respect of an Option are not satisfied by the
respective Option Deadline then such Option shall terminate.
4.08 The Optionor will be the initial operator (hereinafter called the
"OPERATOR") for all Expenditures on the Property to be incurred by the Optionee
pursuant to the exercise of the First Option and Second Option.
Following the first anniversary of this Agreement, the Optionee will have the
right to elect to become the Operator if it wishes.
In the event that the Optionee options the Property to a third party with the
Optionor's approval, such approval not to be unreasonably withheld, and that
third party wishes to assume the Operatorship, they may do so at their choosing
given that both the Optionor and Optionee have been given at least 30 days
notice. In the event that the third party does not elect to assume Operatorship
then the current Operator will continue as Operator.
4.09 This Agreement represents an option only, and the Optionee shall be under
no obligation to the Optionor, save and except in respect of the payment to the
Optionor of the THREE HUNDRED THOUSAND (US$300,000) DOLLARS US provided for in
sub-paragraph 4.02(a)(i)(1) hereof.
TRANSFER OF PROPERTY
5.01 Upon the exercise by the Optionee of either the First Option or the Second
Option, the Optionor shall cause to be delivered to the Optionee duly executed
registerable transfers of the Property to Holdco.
5.02 Prior to the transfer of the Property to Holdco provided for in Paragraph
5.01, the Optionee shall be entitled to record a Memorandum of this Agreement in
the Spanish language with the Mining Public Registry of Mexico at its own cost.
OBLIGATIONS OF THE PARTIES DURING THE OPTION PERIODS
6.01 The Optionor hereby covenants and agrees that for so long as it is acting
as Operator it will:
(a) maintain the Property in good standing by the doing and filing of
applicable assessment work or the making of payments in lieu thereof,
by the payment of taxes and rentals and the performance of all other
actions which may be necessary in that regard and in order to keep the
Property in good standing free and clear of all liens and other
charges except those at the time contested in good faith by the
Optionor;
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(b) permit the Optionee or its duly authorized agents, upon reasonable
prior notice to the Optionor, to have access to the Property in order
to examine any work carried out by the Optionor, provided, however,
that neither the Optionee nor its agents shall interfere or obstruct
the operations of the Optionor, its servants and agents on the
Property, and further provided that the Optionee or its agents shall
enter upon the Property at their own risk and that the Optionee agrees
to indemnify and save the Optionor harmless from all loss or damage of
any nature or kind whatsoever in any way referable to the entry of,
presence on, or activities of either the Optionee or its agents while
on the Property, including, without limiting the generality of the
foregoing, bodily injuries or death at any time resulting therefrom
and damage to property sustained by any person or persons;
(c) deliver to the Optionee on or before the anniversary date of this
agreement in each year a report (including up-to-date maps if there
are any) describing the results of work done on the Property in the
last completed calendar year together with information on material
results obtained;
(d) conduct all work on or with respect to the Property in a careful and
miner like manner and in accordance with all applicable laws,
regulations, orders and ordinances of any relevant governmental
authority and indemnify and save the Optionee harmless from any and
all claims, suits or actions made or brought against it as a result of
work done by the Optionee on or with respect to the Property;
(e) obtain and maintain, or cause any contractor engaged hereunder to
obtain and maintain, during any period in which active work is carried
out hereunder, adequate insurance,
(f) charge the Optionee a 15% Management Fee on all single-item
expenditures.
6.02 The Optionee hereby covenants and agrees that for so long as it is acting
as Operator it will:
(a) maintain the Property in good standing by the doing and arranging for
the filing by Exmin of applicable assessment work or the making of
payments in lieu thereof, by the payment of taxes and rentals and the
performance of all other actions which may be necessary in that regard
and in order to keep the Property in good standing free and clear of
all liens and other charges at least 30 days before the filing is due
except those at the time contested in good faith by the Optionor;
(b) permit the Optionor or its duly authorized agents, upon reasonable
prior notice to the Optionee, to have access to the Property in order
to examine any work carried out by the Optionee, provided, however,
that neither the Optionor nor its agents shall interfere or obstruct
the operations of the Optionee, its servants and agents on the
Property, and further provided that the Optionor or its agents shall
enter upon the Property at their own risk and that the Optionor agrees
to indemnify and save the Optionee harmless from all loss or damage of
any nature or kind whatsoever in any way referable to the entry of,
presence on, or activities of either the Optionor or its agents while
on the Property, including, without limiting the generality of the
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foregoing, bodily injuries or death at any time resulting therefrom
and damage to property sustained by any person or persons;
(c) deliver to the Optionor on or before the anniversary date of this
agreement in each year a report (including up-to-date maps if there
are any) describing the results of work done on the Property in the
last completed calendar year together with information on material
results obtained;
(d) conduct all work on or with respect to the Property in a careful and
miner like manner and in accordance with all applicable laws,
regulations, orders and ordinances of any relevant governmental
authority and indemnify and save the Optionor harmless from any and
all claims, suits or actions made or brought against it as a result of
work done by the Optionee on or with respect to the Property;
(e) obtain and maintain, or cause any contractor engaged hereunder to
obtain and maintain, during any period in which active work is carried
out hereunder, adequate insurance.
(f) include in the Expenditures outlined as per paragraph 4.02(a)(ii) a
15% Management Fee on all exploration-related single-item
expenditures.
6.03 Notwithstanding any of the provisions of this Agreement, the parties
specifically agree that the Optionee will not be responsible for rectifying any
environmental damage sustained on the Property prior to the date hereof.
6.04 BUDGETS, EXPENDITURES AND PAYMENTS
(a) While the Optionor is Operator, Yale will provide the Optionee a
budget for each successive phase of exploration and Optionee agrees
to:
(i) approve and/or provide comments on the budget within fourteen
(14) days;
(ii) give to the Optionor an advance of at least 50% of each budget
within 30 days of its approval and that Optionor will not start
that next phase of exploration until the advance has been
received;
(iii)until such time that the Property is transferred to Holdco, give
to the Optionor sufficient funds to keep the Property in good
standing regardless of the amount of Expenditures incurred on the
Property to date;
(b) While the Optionee is Operator, the Optionee will provide the
Optionor:
(i) an accounting of Expenditures every six (6) months;
(ii) copies of all property tax and option payments if that duty is
performed by the Optionor
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RIGHT OF ENTRY
7.01 During the term of each of the Options provided for in this Agreement,
whichever party is acting as the Operator and its servants, agents and
independent contractors shall have the sole and exclusive right in respect of
the Property to:
(a) enter thereon;
(b) have exclusive and quiet possession thereof;
(c) do such prospecting, exploration, development and/or other mining work
thereon and thereunder as the Operator in its sole discretion may
determine practical under the provisions of work programs to be
jointly prepared and approved by the Optionor and the Optionee prior
to the commencement of operations in respect of such work programs;
(d) bring upon and erect upon the Property such buildings, plant,
machinery, tools, appliances and/or equipment as the Operator may deem
advisable;
(e) remove therefrom and dispose of reasonable quantities of ores,
minerals and metals for the purposes of obtaining assays or making
other tests.
AREA OF MUTUAL INTEREST
8.01 An area of mutual interest located within two (2) kilometres of the
ultimate exterior boundaries of the Property is hereby established (hereinafter
called the "AMI"). By executing this Agreement, each of the parties hereby
covenants and agrees with the other party that any property interest or mineral
rights which may be acquired by either of them located wholly or partially
within the AMI shall become part of the Property for the purposes of this
Agreement, save as otherwise provided for herein.
8.02 If either party acquires a property interest or mineral rights wholly or
partially within the AMI as contemplated in paragraph 8.01 hereof, it shall
notify the other party in writing of the property interest or mineral rights
acquired and the cost of acquisition thereof. The notified party shall then have
thirty (30) days following receipt by it of the foregoing notification to elect
in writing to have the property interest or mineral rights included as part of
the Property for the purposes of this Agreement. If the notified party does not
so elect in writing within this thirty (30) day period, the acquiring party
shall be entitled to retain the property interest or mineral rights for its own
account and such property interest or mineral rights will not form part of the
Property and will not be subject to the terms of this Agreement.
8.03 If the notified party does elect in writing to have the property interest
or mineral rights included as part of the Property for the purposes of this
Agreement as contemplated in paragraph 8.02 hereof, compensation will be as
follows: if acquired by the Optionor, then the Optionee will compensate the
Optionor 100% of the cost of the acquisition and that amount will be credited to
the amount spent to fulfil the Agreement - if acquired by the Optionee, 100% of
the cost of the acquisition and that amount will be credited to the amount spent
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to fulfil the Agreement. Such reimbursement to be made contemporaneously with
the written election to have the property interest or mineral rights so acquired
included as part of the Property for the purposes of this Agreement.
MANAGEMENT COMMITTEE
9.01 A Management Committee composed of one (1) representative of each Party,
shall be established on the Effective Date. Each Party shall, within thirty (30)
days after the Effective Date, notify the other Party in writing of the name of
its representative (the "REPRESENTATIVE") and alternative Representative
("ALTERNATE") who may from time to time act in the absence of the
Representative. Each Party shall also be free to bring to all meetings at its
own cost such technical and other advisors as it may deem appropriate; provided
that such advisors are bound by the provisions of Sections 6 and 14. Each Party
shall have the right at any time and from time to time to change it's
Representative or Alternate by written notice given to the other Party. Each
Party shall incur all costs (which shall not be deemed to be Expenditures) for
its Representative's and Alternate's activities hereunder.
9.02 The Management Committee shall be constituted during the Option Period for
the following purposes:
(a) to review the on-going activities of the Operator on the Property and
to review reports submitted by the Operator on the progress of its
activities;
(b) to discuss in good faith any changes, alterations or recommendations
to the activities undertaken by the Operator on the Property; and
(c) to review proposed exploration operations on the Property to be
undertaken by the Operator.
9.03 Meetings of the Management Committee shall be held no less than once
annually. In lieu of holding meetings of the Management Committee, the
Management Committee may convene telephone conferences with the unanimous
consent of both Parties.
On any matter to be approved by the Management Committee, the Operator
shall have final and binding power on both Parties to decide on a decision in
case of dispute between the Parties.
TERMINATION
10.01 The Optionee may terminate this Agreement at any time prior to the First
Option Deadline, by the Optionee giving notice of termination to the Optionor.
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10.02 Notwithstanding any other provision of this Agreement, if at any time
during the term of either of the Options, the Optionee fails to pay to the
Optionor any payments required under sub-paragraph 4.02(a)(i) hereof, or fails
to incur any of the Expenditures provided for in sub-paragraph 4.02(a)(ii)
hereof, or fails to pay to the Optionor any additional payment required under
sub-paragraph 4.02 (a)(iii) or is in breach of any representation or warranty
contained herein, the Optionor may terminate this Agreement, but only if:
(a) it shall have first given to the Optionee a notice of default
containing particulars of the payment not advanced, the shares not
received, the Expenditures not incurred or the representation or
warranty breached; and
(b) the Optionee has not, within thirty (30) days following delivery of
such notice of default, cured such default.
10.03 Should the Optionee fail to comply with the provisions of sub-paragraph
10.02(b) hereof, the Optionor may thereafter terminate this Agreement, and the
provisions of paragraph 10.04 hereof shall then be applicable.
10.04 If this Agreement terminates prior to the exercise of either of the
Options then the Optionee shall:
(a) have provided to the Optionor records of all Expenditures for filing
for assessment credit, to the maximum extent permitted, or paid money
in lieu thereof to maintain the Property in good standing for at least
30 days from the date of termination; and
(b) deliver to the Optionor copies of all plans, assay maps and diamond
drill records relating to the Expenditures which it had not
theretofore delivered.
TRANSFER OF INTEREST BY THE OPTIONEE
11.01 The Optionee may at any time, with the consent of the Optionor, which
consent shall not be unreasonably withheld, sell, transfer or otherwise dispose
of all or any portion of its interest in and to the Property and this Agreement,
provided that any purchaser, grantee or transferee of any such interest shall
have first delivered to the Optionor its agreement related to this Agreement and
to the Property, containing:
(a) a covenant by such transferee to perform all the obligations of the
Optionee to be performed under this Agreement in respect of the
interest to be acquired by it from the Optionee to the same extent as
if this Agreement had been originally executed by the Optionee and
such transferee as joint and several obligors making joint and several
covenants; and
(b) a provision subjecting any further sale, transfer or other disposition
of such interest or any portion thereof in and to the Property and
this Agreement to the restrictions contained in sub-paragraph 11.01(a)
hereof.
11.02 No assignment by the Optionee of any interest less than its entire
interest in this Agreement and in the Property shall, as between the Optionee
and the Optionor, discharge it from any of its obligations hereunder, but upon
14
the transfer by the Optionee of the entire interest at the time held by it in
this Agreement and in the Property (whether to one or more transferees and
whether in one or in a number of successive transfers), the Optionee shall be
deemed to be discharged from all obligations hereunder or other fulfilment of
contractual commitments and any environmental liabilities, effective on the date
on which the Optionee shall have no further interest in this Agreement or in the
Property.
11.03 If the Optionee or Optionor should desire to sell all or any portion of
its interest in the Property it shall first offer same to the other party. The
other party shall have a 30 day period to elect whether to purchase the offered
interest.
Upon the expiry of the 30 day period the Optionee or Optionor shall be free to
dispose of the offered interest to the extent not committed to be purchased by
the other party to any third party for a period of 180 days and on terms no less
favourable to the other party than was offered to the Optionor. If no sale of
the offered interest is consummated within the aforesaid 180 day period, it
shall thereafter again become subject to the right of first refusal contemplated
hereby.
SURRENDER AND ACQUISITION OF PROPERTY INTERESTS BEFORE TERMINATION OF AGREEMENT
12.01 The party that is the Operator may at any time during the Option Period
elect to abandon one or more of the mining concessions that comprise the
Property by giving prior written notice to the party that is not the Operator
(in this section referred to as the "NON-OPERATOR") of such intention.
12.02 For a period of 60 days after the date of delivery of such notice the
non-Operator may elect to have any or all of the mining concessions in respect
of which such notice has been given transferred to it by delivery of a request
therefor to the Operator, whereupon the Operator will deliver to the Operator a
duly executed registerable transfer document transferring such mining
concessions to the non-Operator. If the non-Operator fails to make request for
the transfer of any mining concessions as aforesaid within such 60-day period,
the Operator may then abandon such mining concessions without further notice to
the non-Operator.
12.03 Upon any such transfer or abandonment the mining concessions so
transferred or abandoned pursuant to Subparagraph 12.02 will for all purposes of
this Agreement cease to form part of the Property.
15
FORCE MAJEURE
13.01 If the Optionee is at any time during the term of this Agreement either
prevented or delayed in complying with any provisions of this Agreement by
reason of strikes, labour shortages, power shortages, fuel shortages, fires,
wars, acts of God, governmental regulations restricting normal operations,
shipping delays or any other reason or reasons (other than lack of funds) beyond
the control of the Optionee, the time limited for the performance by the
Optionee of its obligations hereunder shall be extended by a period of time
equal in length to the period of each such prevention or delay.
13.02 The Optionee shall give prompt notice to the Optionor of each event of
force majeure under paragraph 13.01 hereof and upon cessation of such event
shall furnish the Optionor with notice to that effect together with particulars
of the number of days by which the obligations of the Optionee hereunder have
been extended by virtue of such event of force majeure and all preceding events
of force majeure.
CONFIDENTIAL INFORMATION AND NEWS RELEASES
14.01 The Optionor and the Optionee will, subject to regulatory requirements,
maintain the highest level of confidentiality with respect to this Option
Agreement and the Property.
On a best efforts basis, the Optionor and Optionee shall provide a copy of any
and all News Releases related to this Option Agreement and/or the Property to
the other party to review (but not for approval) by a representative for both
the Optionor and a representative of the Optionee for technical/material content
prior to release.
If there is a regulatory requirement for the Optionor or Optionee to disclose
information relating to this Option Agreement and/or the Property, and no
representative of the Optionor or Optionee is available within 48 hours, the
Optionor will disclose the minimum amount of confidential data to satisfy
regulatory requirements.
ARBITRATION
15.01 The parties agree that all questions or matters in dispute with respect to
the accounting of monies expended by the Optionee as provided for herein, or
with respect to any other matter of a financial nature hereunder, shall be
submitted to arbitration pursuant to the terms hereof.
15.02 It shall be a condition precedent to the right of any party to submit any
matter to arbitration pursuant to the provisions hereof that any party intending
to refer any matter to arbitration shall have given not less than thirty (30)
days' prior written notice of its intention so to do to the other party together
with particulars of the matter in dispute. On the expiration of such thirty (30)
days, the party who gave such notice may proceed to refer the dispute to
arbitration as provided for in paragraph 15.03 hereof.
15.03 Any matter submitted to arbitration hereunder will be conducted before a
single arbitrator appointed by the then President of the British Columbia
Engineers and Geoscientists Association under the provisions of the COMMERCIAL
16
ARBITRATION ACT (British Columbia), or, failing such appointment, by another
single arbitrator appointed under the provisions of said Act. The arbitrator
shall fix a time and place in Vancouver, British Columbia for the purpose of
hearing the evidence and representations of the parties, and shall preside over
the arbitration and determine all questions of procedure not provided for under
such Act or this paragraph. After hearing any evidence and representations that
the parties may submit, the arbitrator shall make an award and reduce the same
to writing, and deliver one copy thereof to each of the parties. The expense of
the arbitration shall be paid as specified in the award.
15.04 The parties agree that the award of the arbitrator shall be final and
binding upon each of them.
NOTICES AND PAYMENT
16.01 Any notice, demand, payment or other communication under this Agreement
will be given in writing and must be delivered or sent by telecopier and
addressed to the party to which it is being given at the following addresses:
(a) if to the Optionor:
YALE RESOUORCES LTD.
Xxxxx 000 - 000 Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX
X0X 0X0
Attention: President
Facsimile: (000) 000-0000
AND A COPY TO:
Xxxxxx Jonsson & Yeadon
1710 - 0000 Xxxx Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxx Xxxxxxxx
X0X 0X0
Attention: Xxx Xxxxxx
Facsimile: (000) 000-0000
(b) if to the Optionee:
AMERICAN SIERRA GOLD CORP.
000 Xxxxxx Xxxxx,
Xxxxx Xxxxxxx, Xxxxxxx, XX.
Attention: President
Facsimile: (000) 000-0000
17
AND A COPY TO:
Xxxxxxxxx Xxxxxx
1210 - 000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxx Xxxxxxxx
X0X 0X0
Attention: Xxxx Xxxxxxxxx
Facsimile: (000) 000-0000
16.02 If notice, demand, payment or other communication is sent by facsimile or
is delivered, it will be deemed to have been received on the next business day
following the day of transmission or delivery.
CURRENCY
17.01 All references to monies hereunder will be in lawful currency of the
United States of America.
REGULATORY ACCEPTANCE
18.01 If required, this Agreement is subject to the Optionor receiving
acceptance herefor from the TSX Venture Exchange (hereinafter called the
"Exchange"). The Optionor agrees to submit this Agreement to the Exchange,
together with all requisite supporting documents and the applicable filing fees,
forthwith upon the execution and delivery hereof by all parties in order to
apply for such acceptance.
FURTHER ASSURANCES
19.01 Each of the parties hereto agrees to do and/or execute all such further
and other acts, deeds, things, devices, documents and assurances as may be
required in order to carry out the true intent and meaning of this Agreement,
including the registration thereof against any of the mineral property interests
comprising the Property at the request of any party.
TIME OF THE ESSENCE
20.01 Time shall be of the essence of this Agreement.
COSTS
21.01 Each of the parties hereto will be responsible for paying its own costs
relating to the preparation and execution of this Agreement.
18
ENTIRE AGREEMENT
22.01 The parties hereto agree that the terms and conditions of this Agreement
shall supersede and replace any other agreements or arrangements, whether oral
or written, heretofore existing among the parties in respect of the subject
matter of this Agreement, including, without limiting the generality of the
foregoing, the document entitled "Letter of Intent" between the parties and
dated the 4th day of February, 2009.
COUNTERPARTS
23.01 This Agreement and any certificate or other writing delivered in
connection herewith may be executed in any number of counterparts and any party
hereto may execute any counterpart, each of which when executed and delivered
will be deemed to be an original and all of which counterparts of this Agreement
or such other writing, as the case may be, taken together, will be deemed to be
one and the same instrument. The execution of this Agreement or any other
writing by any party hereto will not become effective until all counterparts
hereof have been executed by all the parties hereto.
EXECUTION BY FACSIMILE
24.01 Each of the parties hereto will be entitled to rely upon delivery by
facsimile of executed copies of this Agreement and any certificates or other
writings delivered in connection herewith, and such facsimile copies will be
legally effective to create a valid and binding agreement among the parties in
accordance with the terms and conditions of this Agreement.
TITLES
25.01 The titles to the respective paragraphs hereof shall not be deemed as part
of this Agreement but shall be regarded as having been used for convenience
only.
GOVERNING LAW
26.01 This Agreement shall be governed by and construed in accordance with the
laws of the Province of British Columbia and the federal laws of Canada
applicable therein.
19
ENUREMENT
27.01 This Agreement shall enure to the benefit of and be binding upon the
parties hereto and each of their successors and permitted assigns, as the case
may be.
IN WITNESS WHEREOF this Agreement has been executed as of the day and year first
above written.
EXECUTED BY
YALE RESOURCES LTD.
in the presence of:
/s/ Signed
------------------------------------
Authorized Signatory
EXECUTED BY
AMERICAN SIERRA GOLD CORP.
in the presence of:
/s/ Xxxxx Xxxxxx
------------------------------------
Authorized Signatory
SCHEDULE "A"
To the Agreement made and dated for reference the Xth day of April, 2009
Between Yale Resources Ltd. and American Sierra Gold Corp.
Concession Area (hec) File No. Title Date Title No. Registered Owner
---------- ---------- -------- ---------- --------- ----------------
Xxxxx de Oro 22,493.8526 16/32282 12-Aug-05 225290 Xxxxxx Xxxx Vista S.A. de C.V.
Xxxx de Oro Fracc. 1 30.0000 16/32282 12-Aug-05 225291 Xxxxxx Xxxx Vista S.A. de C.V.
Diana de Oro Fracc. 2 103.0503 16/32282 12-Aug-05 225292 Xxxxxx Xxxx Vista S.A. de C.V.
Diana de Oro Fracc. 3 11.8031 16/32282 12-Aug-05 225293 Xxxxxx Xxxx Vista S.A. de C.V.
Diana de Oro Fracc. 4 4,881.3547 16/32282 12-Aug-05 225294 Xxxxxx Xxxx Vista S.A. de C.V.
SUB-TOTAL (XXXXX DE ORO) 27,520.0607
Xxxxx XX 899.0181 16/32712 20-May-05 224570 Xxxxxx Xxxx Vista S.A. de C.V.
San Xxxxx I 90.0000 16/32787 31-May-05 224679 Xxxxxx Xxxx Vista S.A. de C.V.
San Xxxxx XX 88.0000 16/32788 31-May-05 224680 Xxxxxx Xxxx Vista S.A. de C.V.
San Xxxxx III 88.0000 16/32769 31-May-05 224677 Xxxxxx Xxxx Vista S.A. de C.V.
Carolina 145.6392 16/32789 20-Sep-05 225521 Xxxxxx Xxxx Vista S.A. de C.V.
SUB-TOTAL (OTHERS) 1,310.6573
TOTAL 100% OWNED: 28,830.7180
EL VERGEL OPTION (XXXXXXXXX): CERRO COLORADO
El Vergel Option 50.0000 16/24374 30-Nov-04 223311 Xxxxxxx Xxxxx Xxxxxxxxx
SUB-TOTAL (EL VERGEL) 50.0000
XXXXXXX OPTION 1: CERRO COLORADO
Xxxxxxxxx 6.0000 1/1.3-857 29-Jan-02 214981 X. Xxxxxxx y X. Xxxxxxxx
Cerro Colorado 56.7083 016/31476 14-Jun-02 217047 X. Xxxxxxx
La Misionera 40.0000 016/31011 19-Feb-02 215396 X. Xxxxxxx
XXXXXXX OPTION 2: AMPLIACION XXXXXXXXX
Ampl. Xxxxxxxxx 49.3838 099/01791 14-Dec-89 186066 X. Xxxxxxx y X. Xxxxxxxx
Ampl. Xxxxxxxxx XX 74.0000 099/01799 14-Dec-89 186126 X. Xxxxxxx y X. Xxxxxxxx
SUB-TOTAL (XXXXXXX) 226.0921
TOTAL OPTIONED CLAIMS 276.0921
TOTAL URIQUE PROJECT 29,106.8101
SCHEDULE "B"
To the Agreement made and dated for reference the Xth day of April, 2009
Between Yale Resources Ltd. and American Sierra Gold Corp.
Concession Area (hec) Primary NSR Secondary NSR
---------- ---------- ----------- -------------
Xxxxx de Oro 22,493.8526 2% to EXMIN Resources none
Xxxx de Oro Fracc. 1 30.0000 2% to EXMIN Resources none
Xxxxx de Oro Fracc. 2 103.0503 2% to EXMIN Resources none
Xxxxx de Oro Fracc. 3 11.8031 2% to EXMIN Resources none
Xxxxx de Oro Fracc. 4 4,881.3547 2% to EXMIN Resources none
SUB-TOTAL (XXXXX DE ORO) 27,520.0607
Xxxxx XX 899.0181 2% to EXMIN Resources none
San Xxxxx I 90.0000 2% to EXMIN Resources none
San Xxxxx XX 88.0000 2% to EXMIN Resources none
San Xxxxx III 88.0000 2% to EXMIN Resources none
Carolina 145.6392 2% to EXMIN Resources none
SUB-TOTAL (OTHERS) 1,310.6573
TOTAL 100% OWNED: 28,830.7180
EL VERGEL OPTION (XXXXXXXXX): CERRO COLORADO
El Vergel Option 50.0000 none 2% to EXMIN Resources
SUB-TOTAL (EL VERGEL) 50.0000
XXXXXXX OPTION 1: CERRO COLORADO
Xxxxxxxxx 6.0000 1.0 to 1.5 % to Xxxxxxx 0.5-1.0 to EXMIN Resources*
Cerro Colorado 56.7083 1.0 to 1.5 % to Xxxxxxx 0.5-1.0 to EXMIN Resources*
La Misionera 40.0000 1.0 to 1.5 % to Xxxxxxx 0.5-1.0 to EXMIN Resources*
XXXXXXX OPTION 2: AMPLIACION XXXXXXXXX
Ampl. Xxxxxxxxx 49.3838 1.0 to 1.5 % to Xxxxxxx 0.5-1.0 to EXMIN Resources*
Ampl. Xxxxxxxxx XX 74.0000 1.0 to 1.5 % to Xxxxxxx 0.5-1.0 to EXMIN Resources*
SUB-TOTAL (XXXXXXX) 226.0921
TOTAL OPTIONED CLAIMS 276.0921
TOTAL URIQUE PROJECT 29,106.8101
* total NSR to no exceed 2%
