OPTION AGREEMENT
THIS AGREEMENT made as of the 28th day of September, 2001
BETWEEN:
Whitegold Natural Resource Corp.,
of Xxxxx 000, 000 Xxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxx Xxxxxxxx, X0X 0X0
(the "Optionor")
OF THE FIRST PART
AND:
Big Cat Mining Corporation,
of 0000 Xxxxxxx Xxxx, Xxxxxxxx, Xxxxxxx, X0X 0X0
(the "Optionee")
OF THE SECOND PART
WHEREAS:
A. The Optionor is the owner of certain mineral claims located in the Liard Mining Division
of British Columbia (the "Property").
B. The Optionor has agreed to grant an exclusive option to the Optionee to acquire an
interest in and to the Property, subject to the Royalty, on the terms and conditions hereinafter set forth;
NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the sum of $20.00 now
paid by the Optionee to the Optionor (the receipt of which is hereby acknowledged), the parties agree as
follows:
DEFINITIONS
1. For the purposes of this Agreement, the following words and phrases shall have the
following meanings, namely:
(a) Commencement of Commercial Production" means:
(i) if a Mill is located on the Property, the last day of a period of 40 consecutive
days in which, for not less than 30 days, the Mill processed ore from the
Property at 60 percent of its rated concentrating capacity; or
(ii) if no Mill is located on the Property, the last day of a period of 30 consecutive
days during which ore has been shipped from the Property on a reasonably
regular basis for the purpose of earning revenues,
but no period of time during which ore or concentrate is shipped from the Property for
testing purposes, and no period of time during which milling operations are undertaken
as initial tune-up, shall be taken into account in determining the date of Commencement
of Commercial Production;
(b) "Exploration Expenditures" means the sum of:
(i) all costs of acquisition and maintenance of the Property, all exploration and
development expenditures and all other costs and expenses of whatsoever kind
or nature including those of a capital nature, incurred or chargeable by the
Optionee with respect to the exploration and development of the Property and
the placing of the Property into commercial production, and
(ii) as compensation for general overhead expenses which the Optionee will incur,
an amount equal to 10% of all amounts included in subparagraph (i) in each year
except costs of fixed assets and costs and expenditures paid by the Optionee
under any contract involving payments by it in excess of $100,000 in the year,
and 5% of all other amounts included in subparagraph (i) in each year;
(c) "Option" means the option to acquire a 50% undivided interest in and to the Property as
provided in this Agreement;
(d) "Option Period" means the period during the term of this Agreement from the date hereof
to and including the date of exercise or termination of the Option;
(e) "Property" means the mineral claims described in Schedule "A" and all mining leases
and other mining interests derived from any such claims. Any reference to any mineral
claim comprised in the Property includes any mineral leases or other interests into which
such mineral claim may have been converted;
(f) "Property Rights" means all licenses, permits, easements, rights-of-way, certificates and
other approvals obtained by either of the parties either before or after the date of this
Agreement and necessary for the exploration and development of the Property, or for the
purpose of placing the Property into production or continuing production;
(g) "Royalty" means the amount of royalty from time to time payable to the Optionor
hereunder and as defined in Schedule "B" attached hereto.
REPRESENTATIONS AND WARRANTIES OF THE OPTIONOR
2. (a) The Optionor represents and warrants to the Optionee that:
(i) it is legally entitled to hold the Property and the Property Rights and will remain
so entitled until all interest of the Optionor in the Property (other than the
Royalty, if any) has been duly transferred to the Optionee as contemplated
hereby;
(ii) it is and at the time of each transfer to the Optionee of mineral claims comprised
in the Property he will be, the recorded holder and beneficial owner of all of the
mineral claims comprising the Property free and clear of all liens, charges and
claims of others, except as noted on Schedule "A", and no taxes or rentals are
due;
(iii) the mineral claims comprised in the Property have been duly and validly located
and recorded pursuant to the laws of the jurisdiction in which the Property is
situate and, except as specified in Schedule "A" and accepted by the Optionee,
are in good standing with respect to all filings, fees, taxes, assessments, work
commitments or other conditions on the date hereof and until the dates set
opposite the respective names in Schedule "A";
(iv) there is no adverse claim or challenge against or to the ownership of or title to
any of the mineral claims comprising the Property, nor to the knowledge of the
Optionor is there any basis therefore, and there are no outstanding agreements or
options to acquire or purchase the Property or any portion thereof, and no person
other than the Optionor, pursuant to the provisions hereof, has any royalty or
other interest whatsoever in production from any of the mineral claims
comprising the Property other than as set out in Schedule "A";
(v) no proceedings are pending for, and the Optionor is unaware of any basis for the
institution of any proceedings leading to the placing of the Optionor in
bankruptcy or subject to any other laws governing the affairs of insolvent
persons.
(b) The representations and warranties contained in this section 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, and the
representations and warranties contained in this section shall survive the execution
hereof.
REPRESENTATIONS AND WARRANTIES OF THE OPTIONEE
3. (a) The Optionee represents and warrants to the Optionor that:
(i) it has been duly incorporated and validly exists as a corporation in good standing
under the laws of its jurisdiction of incorporation;
(ii) it is lawfully authorized to hold mineral claims and real property under the laws
of the jurisdiction in which the Property is situate;
(iii) 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 the Articles or the constating documents of the Optionee or any shareholders'
or directors' resolution, indenture, agreement or other instrument whatsoever to
which the Optionee is a party or by which it is bound or to which it or the
Property may be subject; and
(iv) no proceedings are pending for and the Optionee is unaware of any basis for the
institution of any proceedings leading to, the dissolution or winding up of the
Optionee or the placing of the Optionee in bankruptcy or subject to any other
laws governing the affairs of insolvent corporations.
(b) The representations and warranties contained in this section 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 its rights in respect
of any other breach of the same or any other representation or warranty and the
representations and warranties contained in this section shall survive the execution
hereof.
GRANT AND EXERCISE OF OPTION
4. (a) The Optionor hereby grants to the Optionee the sole and exclusive right and option to
acquire a 50% undivided interest in and to the Property free and clear of all charges,
encumbrances and claims, except for those set out in Schedule "A".
(b) The Option shall be fully exercised by the Optionee incurring Exploration Expenditures
of $3,500,000 on the Property as follows:
(A) $50,000 on or before March 1, 2003;
(B) a further $100,000 on or before December 31, 2003;
(C) a further $350,000 on or before December 31, 2004.
(D) a further $1,000,000 on or before December 31, 2005; and
(E) a further $2,000,000 on or before December 31, 2006.
In the event that the Optionee spends, in any of the above periods, less than the specified
sum, it may pay the Optionor the difference between the amount it actually spent and the
specified sum before the expiry of that period in full satisfaction of the expenditures
specified. In the event that the Optionee spends, in any period, more than the specified
sum, the excess shall be carried forward and applied to the expenditures to be made in
succeeding periods.
(c) If and when the Option has been exercised, a 50% undivided right, title and interest in
and to the Property shall vest in the Optionee free and clear of all charges, encumbrances
and claims, except for the obligations of the Optionee to pay the Optionor the Royalty, if
any, and to give the Optionor a right of first refusal on any mineral claim comprising a
part of the Property which the Optionee wishes to abandon.
(d) In the event that the Optionee does not fully exercise the Option by fulfilling the terms
set out in subparagraph (b) by the 10th anniversary of this Agreement the Option and this
Agreement shall terminate.
RIGHT OF ENTRY
5. Throughout the Option Period, the directors and officers of the Optionee 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 other mining work as the Optionee in
its sole discretion may determine advisable;
(d) bring upon and erect upon the Property such buildings, plant, machinery and equipment
as the Optionee may deem advisable; and
(e) remove and dispose of reasonable quantities of ores, minerals and metals for the
purposes of obtaining assays or making other tests.
TRANSFER OF PROPERTY
6. (a) Concurrently with the execution of this Agreement, the Optionor shall deliver to the
Optionee duly executed transfers of the appropriate interest in the Property which shall
be acquired by the Optionee upon exercise of the Option.
(b) The Optionee shall be entitled to record all transfers contemplated at its own cost with
the appropriate government office to effect legal transfer of such interest in the Property
into the name of the Optionee, provided that the Optionee shall hold such interest in the
Property subject to the terms of this Agreement, it being understood that the transfer of
such legal title to the Optionee prior to the exercise of the Option is for administrative
convenience only.
OBLIGATIONS OF THE OPTIONEE DURING OPTION PERIOD
7. During the Option Period, the Optionee shall:
(a) maintain in good standing those mineral claims comprised in the Property by the doing
and filing of 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 such mineral claims free and clear of all liens and other
charges arising from the Optionee's activities thereon except those at the time contested
in good faith by the Optionee;
(b) permit the directors, officers, employees and designated consultants of the Optionor, at
their own risk and expense, access to the Property at all reasonable times, and the
Optionor agrees to indemnify the Optionee against and to save it harmless from all costs,
claims, liabilities and expenses that the Optionee may incur or suffer as a result of any
injury (including injury causing death) to any director, officer, employee or designated
consultant of the Optionor while on the Property;
(c) permit the Optionor, at its own expense, reasonable access to the results of the work
done on the Property during the last completed calendar year;
(d) do all work on the Property in a good and workmanlike fashion and in accordance with
all applicable laws, regulations, orders and ordinances of any governmental authority;
(e) indemnify and save the Optionor harmless in respect of any and all costs, claims,
liabilities and expenses arising out of the Optionee's activities on the Property, but the
Optionee shall incur no obligation hereunder in respect of claims arising or damages
suffered after termination of the Option if upon termination of the Option any workings
on or improvements to the Property made by the Optionee are left in a safe condition.
TERMINATION OF OPTION
8. (a) The Optionee may terminate the Option by notice to the Optionor.
(b) If the Option is terminated by the Optionee or the Optionor, the Optionee shall:
(i) leave in good standing for a period of at least 24 months from the termination of
the Option Period those mineral claims comprised in the Property;
(ii) deliver to the Optionor a Xxxx of Sale or other proper form of transfer documents,
in recordable form whereby the right, title and interest in and to the Property has
been transferred to the Optionor or its nominee or nominees, free and clear of all
liens or charges arising from the Optionee's activities on the Property; and
(iii) deliver at no cost to the Optionor within 90 days of such termination, copies of
all reports, maps, assay results and other relevant technical data compiled by,
prepared at the direction of, or in the possession of the Optionee with respect to
the Property and not theretofore furnished to the Optionor.
(c) Notwithstanding the termination of the Option, the Optionee shall have the right, within
a period of 180 days following the end of the Option Period, to remove from the Property
all buildings, plant, equipment, machinery, tools, appliances and supplies which have
been brought upon the Property by or on behalf of the Optionee, and any such property
not removed within such 180 day period shall thereafter become the property of the
Optionor.
ROYALTY
9. (a) Upon the Commencement of Commercial Production, the Optionee shall pay to the
Optionor the Royalty, being equal to 3% of net Smelter Returns on the terms and
conditions as set out in this section and in Schedule "B".
(b) Instalments of the Royalty payable under paragraph (a) shall be paid by the Optionee as
follows:
(i) within 45 days after the end of each of the Optionee's first three fiscal quarters in
each fiscal year and within 60 days of the end of the Optionee's last fiscal quarter
in each fiscal year, the Optionee shall pay to the Optionor an amount equal to
25% of the estimated Royalty, if any, for the fiscal year, adjusted if necessary
after the first quarter of any fiscal year to reflect any change during the fiscal
year in estimated Royalty; and
(ii) within 120 days after the end of the Optionee's fiscal year, the balance, if any, of
Royalty payable in respect of the fiscal year last completed.
(c) After Commencement of Commercial Production, the Optionee shall, within 45 days
after the end of each fiscal quarter, furnish to the Optionor quarterly unaudited
statements respecting operations on the Property, together with a statement showing the
calculation of Royalty for the fiscal quarter last completed.
(d) Forthwith after the end of each fiscal year, commencing with the year in which
Commencement of Commercial Production occurs, the accounts of the Optionee relating
to operations on the Property shall be audited by the auditors of the Optionee, at its
expense, and the statement of operations, which shall include the statement of
calculation of Royalty for the year last completed. The Optionor shall have 45 days after
receipt of such statements to question the accuracy thereof in writing and, failing such
objection, the statements shall be deemed to be correct and unimpeachable thereafter.
(e) If the audited financial statements furnished pursuant to paragraph (d) disclose any
overpayment of Royalty by the Optionee during the fiscal year, the amount of the
overpayment shall be debited against future instalments of Royalty payable hereunder.
(f) If the audited financial statements furnished pursuant to paragraph (d) disclose any
underpayment of Royalty by the Optionee during the year, the amount thereof shall be
paid to the Optionor forthwith after determination thereof.
(g) The Optionor agrees to maintain for each mining operation on the Property, up-to-date
and complete records relating to the production and sale of minerals, ore, bullion and
other product from the Property, including accounts, records, statements and returns
relating to treatment and smelting arrangements of such product, and the Optionor or its
agents shall have the right at all reasonable times, including for a period of 12 months
following the expiration or termination of this Agreement, to inspect such records,
statements and returns and make copies at its own expense for the purpose of verifying
the amount of Royalty payments to be made by the Optionee to the Optionor pursuant
hereto. The Optionor shall have the right at its own expense to have such accounts
audited by independent auditors once each fiscal year.
(h) Upon the Optionor receiving a total of $1,000,000 from payments of Royalty, the
Royalty shall terminate. The Optionee shall always have the right to prepay such amount
before it is actually due.
POWER TO CHARGE PROPERTY
10. At any time after the Optionee has exercised the Option, the Optionee may grant
mortgages, charges or liens (each of which is herein called a "mortgage") of and upon the Property or any
portion thereof, any mill or other fixed assets located thereon and any or all of the tangible personal
property located on or used in connection with the Property to secure financing of development of the
Property, provided that, unless otherwise agreed to by the Optionor, it shall be a term of each mortgage
that the mortgagee or any person acquiring title to the Property upon enforcement of the mortgage shall
hold the same subject to the rights of the Optionor hereunder as if the mortgagee or any such person had
executed this Agreement.
TRANSFERS
11. (a) The Optionee may at any time either during the Option Period or thereafter, 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:
(i) 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 such transferee; and
(ii) a provision subjecting any further sale, transfer or other disposition of such
interest in the Property and this Agreement or any portion thereof to the
restrictions contained in this paragraph (a).
(b) 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 the transfer by the Optionee
of the entire interest at the time held by it in this Agreement, 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 save and except for the
payment of the Royalty or other fulfillment of contractual commitments accrued due
prior to the date on which the Optionee shall have no further interest in this Agreement.
(c) If the Optionor should receive a bona fide offer from an independent third party (the
"Proposed Purchaser") dealing at arm's length with the Optionor to purchase all or a part
of its interest in the Property, which offer the Optionor desires to accept, or if the
Optionor intends to sell all or a part of its interest in the Property:
(i) The Optionor shall first offer (the "Offer") such interest in writing to the
Optionee upon terms no less favourable than those offered by the Proposed
Purchaser or intended to be offered by the Optionor, as the case may be.
(ii) The Offer shall specify the price, terms and conditions of such sale, the name of
the Proposed Purchaser and shall, in the case of an intended offer by the
Optionor, disclose the person or persons to whom the Optionor intends to offer
its interest and, if the offer received by the Optionor from the Proposed
Purchaser provides for any consideration payable to the Optionor otherwise than
in cash, the Offer shall include the Optionor's good faith estimate of the cash
equivalent of the non-cash consideration.
(iii) If within a period of 60 days of the receipt of the Offer the Optionee notifies the
Optionor in writing that it will accept the Offer, the Optionor shall be bound to
sell such interest to the Optionee on the terms and conditions of the Offer. If the
Offer so accepted by the Optionee contains the Optionor's good faith estimate of
the cash equivalent of the non cash consideration as aforesaid, and if the
Optionee disagrees with the Optionor's best estimate, the Optionee shall so
notify the Optionor at the time of acceptance and the Optionee shall, in such
notice, specify what it considers, in good faith, the fair cash equivalent to be and
the resulting total purchase price. If the Optionee so notifies the Optionor, the
acceptance by the Optionee shall be effective and binding upon the Optionor and
the Optionee, and the cash equivalent of any such non-cash consideration shall
be determined by binding arbitration and shall be payable by the Optionee,
subject to prepayment as hereinafter provided, within 60 days following its
determination by arbitration. The Optionee shall in such case pay to the
Optionor, against receipt of an absolute transfer of clear and unencumbered title
to the interest of the Optionor being sold, the total purchase price which is
specified in its notice to the Optionor and such amount shall be credited to the
amount determined following arbitration of the cash equivalent of any non-cash
consideration.
(iv) If the Optionee fails to notify the Optionor before the expiration of the time
limited therefore that it will purchase the interest offered, the Optionor may sell
and transfer such interest to the Proposed Purchaser at the price and on the terms
and conditions specified in the Offer for a period of 60 days, but the terms of this
paragraph shall again apply to such interest if the sale to the Proposed Purchaser
is not completed within such 60 days.
(v) Any sale hereunder shall be conditional upon the Proposed Purchaser delivering
a written undertaking to the Optionee, in form and substance satisfactory to its
counsel, to be bound by the terms and conditions of this Agreement.
SURRENDER AND ACQUISITION OF PROPERTY
INTEREST PRIOR TO TERMINATION OF AGREEMENT
12. The Optionee may at any time elect to abandon any one or more of the mineral claims
comprised in the Property by giving notice to the Optionor of such intention. For a period of 30 days
after giving such notice, the Optionor may elect to have any or all of the mineral claims in respect of
which such notice has been given transferred to it by delivery of a request therefore to the Optionee,
whereupon the Optionee shall deliver to the Optionor a Xxxx of Sale or other appropriate transfer
documents in registrable form transferring such mineral claims to the Optionor. Any claims so
transferred shall be in good standing under the laws of the jurisdiction in which they are situate for at
least 24 months from the date of transfer. If the Optionor fails to make request for the transfer of any
mineral claims as aforesaid within such 30 day period, the Optionee may then abandon such mineral
claims without further notice to the Optionor. Upon any such transfer or abandonment, the mineral
claims so transferred or abandoned shall for all purposes of this Agreement cease to form part of the
Property.
FORCE MAJEURE
13. (a) If the Optionee is at any time either during the Option Period or thereafter prevent or
delayed in complying with any provisions of this Agreement by reason of strikes, lock-outs, 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, but nothing herein shall discharge the Optionee from its obligations hereunder to
maintain the Property in good standing;
(b) The Optionee shall give prompt notice to the Optionor of each event of force majeure
under paragraph (a) and upon cessation of such event shall furnish to the Optionor with
notice t 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.
(c) After the Commencement of Commercial Production, the Optionee shall work, mine and
operate the Property during such time or times as the Optionee in its sole judgment
considers such operations to be profitable. The Optionee may suspend or curtail
operations, both before and after Commencement of Commercial Production, during
periods when the products derived from the Property cannot be profitable sold at
prevailing prices or if an unreasonable inventory thereof, in the Optionee's sole
judgment, has accumulated or would otherwise accumulate.
CONFIDENTIAL INFORMATION
14. No information furnished by the Optionee to the Optionor hereunder in respect of the
activities carried out on the Property by the Optionee, or related to the sale of minerals, ore, bullion or
other product derived from the Property, shall be published by the Optionor without the prior written
consent of the Optionee, but such consent in respect of the reporting of factual data shall not be
unreasonably withheld, and shall not be withheld in respect of information required to be publicly
disclosed pursuant to applicable securities or corporation laws.
ARBITRATION
15. (a) The parties agree that all questions or matters in dispute with respect to the accounting of
monies hereunder or in any respect to any other dispute which the parties agree shall be
settled by arbitration, shall be submitted to arbitration pursuant to the terms hereof.
(b) 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 10 days' prior notice of its intention to do so
to the other party, together with particulars of the mater in dispute. On the expiration of
such 10 days, the party who gave such notice may proceed to refer the dispute to
arbitration as provided in paragraph (c).
(c) The party desiring arbitration shall appoint one arbitrator and shall notify the other party
of such appointment and the other party shall, within 15 days after receiving such notice,
either consent to the appointment of such arbitrator which shall then carry out the
arbitration or appoint an arbitrator and the two arbitrators so named, before proceeding
to act, shall within 30 days of the appointment of the last appointed arbitrator,
unanimously agree on the appointment of a third arbitrator to act with them and be
chairman of the arbitration herein provided for.
If the other party shall fail to appoint an arbitrator within 15 days after receiving notice of the
appointment of the first arbitrator, the first arbitrator shall be the only arbitrator, and if the two
arbitrators appointed by the parties shall be unable to agree on the appointment of the chairman,
the chairman shall be appointed under the provisions of the Commercial arbitration Act of
British Columbia. Except as specifically otherwise provided in this section, the arbitration
herein provided for shall be conducted in accordance with such Act. The chairman, or in the
case where only one arbitrator is appointed, the single arbitrator, shall fix a time and place in
Vancouver, British Columbia, for the purpose of hearing the evidence and representations of the
parties, and he shall preside over the arbitration and determine all questions of procedure not
provided for under such Act or this section. After hearing any evidence and representations that
the parties may submit, the single arbitrator, or the arbitrators, as the case may be, shall make an
award and reduce the same to writing and delivery one copy thereof to each of the parties. The
expense of the arbitration shall be paid as specified in the award.
(d) The parties agree that the award of a majority of the arbitrators or in the case of a single
arbitrator, of such arbitrator, shall be final and binding upon each of them.
DEFAULT AND TERMINATION
16. (a) If at any time during the Option Period the Optionee fails to perform any obligation
required to be performed by it hereunder or is in breach of a warranty given by it
hereunder, which failure or breach materially interferes with the implementation of this
Agreement, the Optionor may terminate this Agreement, but only if:
(i) it shall have first given to the Optionee a notice of default containing particulars
of the obligation which the Optionee has not performed or the warranty
breached; and
(ii) the Optionee has not, within 45 days following delivery of such notice of default,
cured such default or commenced proceedings to cure such default by
appropriate payment or performance, the Optionee hereby agreeing that should it
so commence to cure any default it will prosecute the same to completion
without undue delay.
Should the Optionee fail to comply with the provision of subparagraph (ii), the Optionor
may thereafter terminate this Agreement.
(b) The Optionee may permanently discontinue mining operations on the Property at any
time after the Commencement of Commercial Production when in its opinion no further
mining operations can be economically carried out thereon. At such time, the Optionee
shall dispose of all mining plant and equipment used on the Property, effect all
reclamation work as required by law and otherwise dispose of the Property as it thinks
fit. Any purchaser of the Property after termination of mining operations on the Property
shall take the Property free and clear of all claims by the Optionor. The accounts of the
Optionee relating to its mining operations on the Property shall be audited by the
auditors of the Optionee as soon as practicable after the sale or disposition of all mining
plant, equipment and the Property and completion of reclamation. Final settlement of
any Royalty payable to the Optionor shall be effected without delay after receipt of the
final audited statements. After receipt of such final audited statements and payment of
Royalty, if any, this Agreement and the mutual obligations of the Optionee and the
Optionor hereunder shall terminate.
NOTICES
17. (a) Each notice, demand or other communication required or permitted to be given under
this Agreement shall be in writing and shall be sent by prepaid registered mail deposited
in a Post Office in Canada addressed to the party entitled to receive the same, or
delivered, telexed, telegraphed or telecopied to such party at the address for such party
specified above. The date of receipt of such notice, demand or other communication
shall be the date of delivery thereof if delivered, telexed, telegraphed or telecopied, or, if
given by registered mail as aforesaid, shall be deemed conclusively to be the third
business day after the same shall have been so mailed except in the case of interruption
of postal services for any reason whatever, in which case the date of receipt shall be the
date on which the notice, demand or other communication is actually received by the
addressee.
(b) Either party may at any time and from time to time notify the other party in writing of a
change or address and the new address to which notice shall be given to it thereafter until
further change.
GENERAL
18. (a) This Agreement shall supersede and replace any other agreement or arrangement,
whether oral or written, heretofore existing between the parties in respect of the subject
matter of this Agreement.
(b) No consent or waiver expressed or implied by either party in respect of any breach or
default by the other in the performance by such other of its obligations hereunder shall
be deemed or construed to be a consent to or a waiver of any other breach of default.
(c) The parties shall promptly execute or cause to be executed all documents, deeds,
conveyances and other instruments of further assurance and do such further and other
acts which may be reasonably necessary or advisable to carry out fully the intent of this
Agreement or to record wherever appropriate the respective interest from time to time of
the parties in the Property.
(d) This Agreement shall enure to the benefit of and be binding upon the parties and their
respective successors and permitted assigns.
(e) This Agreement shall be governed by and construed in accordance with the laws of
British Columbia and shall be subject to the approval of all securities regulatory
authorities having jurisdiction.
(f) Time shall be of the essence in this Agreement.
(g) Wherever the neuter and singular is used in this Agreement it shall be deemed to include
the plural, masculine and feminine, as the case may be.
IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the day and year first
above written.
The CORPORATE SEAL of )
Whitegold Resource Corp. )
was hereunto affixed in the )
presence of: ) c/s
)
_____________________________________ )
)
_____________________________________ )
The CORPORATE SEAL of )
Big Cat Mining Corporation )
was hereunto affixed in the )
presence of: ) c/s
)
_____________________________________ )
)
_____________________________________ )
c:\data\wp\big cat\agreements\option agreement.doc
SCHEDULE "A"
To Option Agreement dated September 28, 2001
|
Claim Name |
Record Number |
Year of Expiry |
|
ISK1 |
227242 |
March 5, 2002 |
|
ISK2 |
227244 |
March 5, 2002 |
|
ISK3 |
227243 |
March 5, 2002 |
|
ISK4 |
227245 |
March 5, 2002 |
|
BRYS1 |
669164M |
August 16, 2002 |
|
BRYS2 |
669165M |
August 16, 2002 |
|
BRYS3 |
669200M |
August 16, 2002 |
|
BRYL1 |
669160M |
August 15, 2002 |
|
BRYL2 |
669161M |
August 15, 2002 |
|
BRYL3 |
669162M |
August 15, 2002 |
|
BRYL4 |
669163M |
August 16, 2002 |
|
GRIZZLY |
228114 |
August 10, 2002 |
|
ISK5 |
227213 |
March 3, 2003 |
|
ISK6 |
227224 |
March 3, 2002 |
Liard Mining Division
SCHEDULE "B"
To Option Agreement dated September 28, 2001
NET SMELTER RETURNS
1. For the purposes of this Agreement "Net Smelter Returns" shall mean the actual proceeds
received from any mint, smelter or other purchaser for the sale of bullion, concentrates or ores produced from the
Property and sold, after deducting from such proceeds the following charges to the extent that they are not deducted
by the purchaser in computing payment:
(a) in the case of the sale of bullion, refining charges only;
(b) in the case of the sale of concentrates, smelting and refining charges, penalties and the cost of
transportation of such concentrates from the Property to any smelter or other purchaser; and
(c) in the case of ores shipped to a purchaser, refining charges for bullion and charges for smelting,
refining and the cost of transportation from the mill to any smelter or other purchaser for
concentrates.
2. The Optionee shall have the right to commingle with ore from the Property, ore produced from
other properties owned or controlled by the Optionee, provided the Optionee shall adopt and employ reasonable
practices and procedures for weighing, sampling and assaying in order to determine the amounts of products derived
from, or attributable to, ore mined and produced from the Property. The Optionee shall maintain accurate records of
the results of such sampling, weighing and assaying with respect to any ore mined and produced from the Property.
The Optionor or its authorized agent shall be permitted the right to examine at all reasonable times such records
pertaining to commingling of ores or to the calculations of Net Smelter Returns.
3. Commencing on the fifth anniversary of this Agreement and every year thereafter until
Commencement of Commercial Production from the Property, the Optionee shall pay the Optionor an advance on
Net Smelter Returns of $100,000. Any advances on Net Smelter Returns paid under this paragraph shall be
accumulated and be deductible from any Net Smelter Returns to the Optionor to the extent such Net Smelter
Returns payments exceed $100,000 for any calendar year.
4. If, after Commencement of Commercial Production from the Property, Net Smelter Returns
payable to the Optionor for any calendar year are less than $100,000, the Optionee shall pay to the Optionor on or
before June 1 of the following year the difference between the $100,000 and the amount of Net Smelter Returns
payable for the said calendar year.
