Letter of Intent
April 7th, 2004
Minquest Inc.
Mr. Xxxxxxx Xxxx
0000 Xxxxxxx Xxx
Xxxx, XX 00000
RE: Xxxxxx Property, Nevada
Dear Xx. Xxxx,
This letter is intended to serve an indication of the undersigned's intent
relating to the proposed option purchase for the property described above (the
"Property"). It is understood that this letter constitutes a non-binding
expression of intent only and that any final and binding agreement shall be
subject to the preparation, negotiation and execution of definitive legal
documents (hereinafter the "Contract"). Subject to the foregoing limitations, it
is the mutual intention and understanding of the parties that the terms and
conditions of the Contract to be entered into shall include, among others, the
following terms and conditions:
1. Purchaser: American Goldfields Inc.
2. Seller: MinQuest Inc.
3. Property: The Property to be optioned, more particularly described in
surveys to be agreed upon by both parties hereto, as well as
appurtenances thereto, including, but not limited to, all leases and
any and all other rights, title and interests that are conveyed in
similar transactions in the State of Nevada.
4. Purchase Terms:
a. Payment to Minquest: Amount
----------
b. Upon Signing $10,000.00
1st Anniversary $15,000.00
2nd Anniversary $15,000.00
3rd Anniversary $15,000.00
4th Anniversary $15,000.00
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Total: $70,000.00
c. Property Expenditures: Amount
----------
1st Year $50,000.00
2nd Year $75,000.00
3rd Year $100,000.00
4th Year $100,000.00
5th Year $125,000.00
c. Conditions:
i. Completion of the above schedule would earn American
Goldfields Inc. a 100% interest in the properties
subject to Minquest retaining a 3% royalty of which
2/3 can be purchased at a rate of $1,000,000 for each
1%.
ii. Company will reimburse MinQuest all acquisition costs
associated with claim staking on the property
estimated to total $5,500.
iii. Company assumes future carrying costs of the property
estimated at $3500 per year thereafter.
iv. All figures are US Funds.
v. The Company agrees to use Minquest to provide on-site
project management for the property at competitive
commercial rates.
vi. The Company is interested in discussing further
property options with Minquest.
5. Deposit: Within five (5) business days after the effective date of the
Contract, Purchaser shall cause to be deposited with Minquest (the
"Title Company") the amount of ten thousand dollars ($10,000).
6. Contract: The contract for this purchase shall be prepared within 15
days of acceptance of this Letter of Intent.
7. Title: Seller at Sellers sole cost shall provide existing title
documents and a map showing the location of the claims.
8. Closing: Closing shall be at a time agreed to by the Buyer and Seller
9. Assignment: Purchaser and Seller shall have the right to assign its
rights to the Letter of Intent or the Contract.
10. Other Documentation: Seller hereby agrees that 10 days from acceptance
of this Letter of Intent, it shall provide Purchaser with all studies,
engineering reports, site plans, agreements, warranties and guarantees
currently existing with respect to all or any part of the Property.
11. Confidentiality: Seller and its principal shareholders or partners,
employees, agents and representatives will use good faith efforts to
not disclose the subject matter or terms of this Letter or transaction
contemplated hereby.
If the foregoing properly evidences our preliminary understanding, please
indicate your approval in the space provided below and return a fully executed
copy of this Letter of Intent to our attention on or before 5:00 PM EST, April
8th, 2004. In the event such approval is not received prior to expiration of
such specified time period, this Letter of Intent shall expire and be of no
further effect.
Very truly yours, PURCHASER: ACCEPTED BY SELLER:
By: /s/ Xxxxxx Xxxx By: /s/ Xxxxxxx Xxxx
---------------------------- -----------------------------------
Name: Xxxxxx Xxxx Name: Xxxxxxx Xxxx
Company: American Goldfields Inc. Company:Minquest Inc.
Title: President Title: President
Date: April 8th, 2004 Date: April 8th, 2004
