ASSET PURCHASE AGREEMENT
Exhibit
99.1
This
Asset Purchase Agreement (the “Agreement”) is made and entered into as of this
3rd day August, 2005 by and between Miniera Compania Double Down, SA an Ecuador
corporation hereinafter referred to as “Buyer” and U.S. Canadian Minerals Inc. a
Nevada corporation, hereinafter referred to as “Seller”
RECITALS
WHEREAS,
the seller owns 80% of Yellow River Mining, SA, an Ecuador corporation,
hereinafter referred to as (“Yellow River”).
WHEREAS,
Seller desires to sell and buyer desires to purchase the Seller’s interest in
Yellow River on the terms and subject to the conditions set forth in this
Agreement.
WHEREAS,
this Agreement is the consummation of all prior negotiations, drafts, initial
agreements etc. it is to be considered the full and final agreement between
the
parties relating to this transaction.
AGREEMENT
| 1. |
PURCHASE
AND SALE OF ASSETS.
On the terms and subject to the conditions set forth in this Agreement,
Seller agrees to sell, convey, assign, transfer and deliver to Buyer
and
Buyer agrees to purchase from Seller, at the closing date of October
10,
2005 the assets as described on Exhibit A hereto (the “Acquired
Assets”).
|
| 2. |
ASSUMPTION
OF OBLIGATIONS AND LIBILITIES.
At the time of closing, as herein defined, The Sellers total liability
to
Nevada Minerals is $127,000.00.
|
| 3. |
PURCHASE
PRICE. As
consideration for the sale, conveyance, assignment, transfer and
delivery
of the Acquired Assets, the Buyer agrees on the Closing Date to pay
$800,000 in total consideration to the
Seller.
|
| 4. |
CLOSING.
The closing shall take place on the Closing Date of August 5, 2005
at the
office of Securities Law Institute, Suite 250 770 Warm Springs Rd.
Las
Vegas, Nevada, at 1 P.M. local time or such other time and place
as the
parties may agree upon in writing. Buyer has the right to extend
the
Closing Date by 30 days upon the release to Seller of an additional
$100,000, which sum is to be applied to purchase price upon
closing.
|
| 5. |
DELIVERIES
AT CLOSING.
At
the closing on the Closing Date:
|
| (a) |
Seller
shall deliver to Buyer the Acquired Assets, a stock power executed
in
blank with respect to said certificates and such other instruments
as are
sufficient in the opinion of Buyer and its legal counsel to vest
in Buyer
and its successors or assigns the absolute) legal and equitable title
to
all of the Acquired Assets.
|
| (b) |
| (c) |
Buyer
delivering to Seller that Certificate of Title as referenced in Exhibit
B;
|
| (d) |
Buyer
shall deliver to Seller S250,000.
|
| 6. |
REPRESENTATIONS
AND WARRANTIES OF SELLER.
Seller hereby represents and warrants to Buyer
that:
|
| (a) |
Seller
is a corporation duly organized, validly existing and in good standing
under the laws of the State of Nevada. Seller has the requisite power
and
authority to own and operate its assets, properties and business
and to
carry on its business as now
conducted.
|
| (b) |
The
execution and delivery of this Agreement and the consummation of
the
transactions contemplated hereby have been duly authorized and approved
by
the board of directors of Seller, and, when executed by the authorized
representative of the Seller, this Agreement will constitute a legal
valid
and binding agreement of Seller.
|
| (c) |
The
execution and delivery of this Agreement and the consummation of
the
transactions contemplated hereby will not result in a breach of terms
and
conditions of, or result in a loss of rights under, or result in
the
creation of any lien, charge or encumbrance upon, any of the Acquired
Assets pursuant to (i) Seller’s articles of incorporation or bylaws, (ii)
any franchise, mortgage, deed of trust, lease, license, permit, agreement,
instrument or undertaking to which Seller is a party or by which
it or any
of its properties are bound, or (iii) any statute, rule, regulation,
order, judgment, award or decree.
|
| (d) |
Seller
has good and marketable title to all of its assets and properties,
including, without limitation, the assets related to the Yellow
River
Processing
Plant in Ecuador.
|
| (f) |
To
Seller’s knowledge, there is no suit, claim, action or proceeding now
pending threatened before any court, administrative or regulatory
agency
or any basis for such a claim which may result in any judgment, order,
decree, liability or any other determination which may have an adverse
effect, financial or otherwise, upon Seller or any of the Acquired
Assets.
No such judgment, order or decree has been entered which has or could
have
such effect.
|
| (g) |
To
the best of Seller’s knowledge, Seller has all licenses and permits
(federal, state, and local) necessary to conduct its business and
such
licenses and permits are in full force and effect. No violations
are or
have been recorded in respect of such licenses or permits and no
proceeding is pending or threatened which could result in the revocation
or limitation of any such licenses or
permits.
|
| (h) |
No
consent is necessary to effect the transfer to Buyer of any of the
Acquired Assets and, upon the consummation of the transaction contemplated
hereby, Buyer will be entitled to use the Acquired Assets to the
full
extent that Seller used the same immediately prior to the transfer
of the
Acquired Assets.
|
| (i) |
Neither
this Agreement nor any Exhibit hereto delivered by Seller pursuant
to this
Agreement contains an untrue statement of material fact or omits
to state
a fact that is necessary in order to make the statements contained
herein
and therein, in light of the circumstances under which they are xxxx,
not
materially misleading
|
| 7. |
REPRESENTATIONS
AND WARRANTIES OF BUYER. Buyer hereby represents and warrants to
Seller that:
|
| (a) |
Buyer
is a corporation duly organized, validly existing and in good standing
under the laws of the Country of Ecuador, Buyer has the requisite
power
and authority to own and operate its assets, properties and business
and
to carry on its obligations
hereunder.
|
| (b) |
The
execution and delivery of this Agreement and the consummation of
the
transaction contemplated hereby have been duly authorized and approved
by
the board of directors of Buyer, and when executed by the authorized
representative of the Buyer, this Agreement will constitute a legal,
valid, and binding agreement of
Buyer.
|
|
8.
|
SURVIVAL
OF REPRESENTATIONS AND WARRANTIES:
All representations and warranties made by each of the parties hereto
shall survive the closing for a period of three years after the Closing
Date.
|
| 9. |
INDEMNIFICATION.
|
| (a) |
Seller
agrees to indemnify, defend and hold harmless Buyer against any and
all
claims, demands, losses, cost, expenses, obligations, liabilities
and
damages, including interest, penalties, and reasonable attorney’s fees,
incurred by Buyer arising, resulting from, or relating to any breach
of,
or failure by Seller to perform, any of its representations, warranties,
covenants or agreements in this Agreement or in any Exhibit or other
document furnished or to be furnished by Seller under this
Agreement.
|
| (b) |
Buyer
agrees to indemnify, defend, and hold harmless Seller against any
and all
claims, demands, losses, cost, expenses, obligations, liabilities
and
damages, including interest, penalties, and reasonable attorney’s fees,
incurred by Seller arising, resulting from, or relating to (i) any
breach
of, or failure by Seller to perform, any of its representations,
warranties, covenants or agreements in this Agreement or in any Exhibit
or
other document furnished or to be furnished by Buyer under this Agreement,
or (ii) any act or omission of Buyer or any of its successors or
assigns
after Closing Date that constitutes a breach or default under, or
failure
to perform, any obligation, duty, or liability of Yellow River under
any
contract, lease, license or other agreement to which it is party
or by
which it is bound at the Closing Date, or (iii) any liability of
Seller
arising out of its ownership of the Acquired Assets and caused by
the
business or operations of Yellow
River.
|
| 10. |
GENERAL
PROVISIONS.
|
| 10.1 |
CONSTRUCTION.
This Agreement shall be construed and enforced in accordance with
the laws
of Nevada.
|
| 10.2 |
NOTICES.
All notices, request, demands and other communications contemplated
under
this Agreement shall be in writing and shall be deemed to have been
duly
given when personally delivered or when mailed by United States express,
certified or registered mail, postage prepaid, addressed to the following
parties, their successors in interest, or their permitted assignees
at the
following address, or at such other address as the parties may designate
by written notice in the manner
aforesaid:
|
| 10.3 |
SECTION
HEADINGS.
The section headings in this Agreement are included for convenience
only,
are not part of this Agreement and shall not be used in construing
it.
|
| 10.4 |
COUNTERPARTS.
This Agreement may be executed in one or more counterparts, each
or which
shall be deemed an original but all of which together shall constitute
one
and the same instrument.
|
IN
WITNESS WHEREOF, The parties have duty executed this Agreement as of the date
first mentioned.
BUYER:
Miniera Compania Double Down, SA
/s/
Xxxxx Xxxxxx, Pres.
Xx
Xxxxxx, President
SELLER:
U.S. Canadian Minerals, Inc.
_______________________
Xxxx
X.
Woodwarcl, President
/s/
Xxxxxx Xxxxxxxx
Xxxxxx
Xxxxxxxx, CEO
EXHIBIT
A
List
of
Acquired Assets
(80%)
Eighty percent of the issued and outstanding shares of stock of Yellow River
Mining, SA,
