EXHIBIT 10.1
OPTION TO PURCHASE AGREEMENT
THIS AGREEMENT made as of the 31st day of December 2006.
BETWEEN:
XXXXXX XXXX, an individual, residing at 0000 Xxxxxxxxx Xxxx, Xxxx Xxxxxxxxx,
Xxxxxxx Xxxxxxxx, Xxxxxx X0X 0X0
(hereinafter referred to as the "Vendor")
PARTIES OF THE FIRST PART
AND:
RIVER EXPLORATION, INC., a company duly incorporated under the laws of the State
of Nevada, having an office at 000 Xxxxx Xxxxxx Xxxxxx, Xxxxxx Xxxx, Xxxxxx
00000
(hereinafter referred to as "REI")
OF THE SECOND PART
WHEREAS:
A. Vendor is the sole beneficial owner of 100% of the mineral claims Pretty
Girl 3 and Pretty Girl 4 located in the Pretty Girl mineral claim group in
the Golden Mining Division of the Ministry of Sustainable Resource
Management, west of Invermere, British Columbia, Canada as described in
Schedule "A" attached hereto and forming part hereof (hereinafter together
with any form of successor or substitute mineral tenure called the
"Claim").
B. The parties now wish to enter into an agreement granting to REI the
exclusive right and option to acquire an undivided 100% of the right,
title and interest in and to the Claim on the terms and conditions as
hereinafter set forth.
NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the premises and
the mutual promises, covenants and agreements herein contained, the parties
hereto agree as follows:
1. INTERPRETATION
1.1 In this Agreement:
(a) "Effective Date" means the date that both parties have signed this
Agreement;
(b) "Mineral Products" means the products derived from operating the
Claim as a mine;
(c) "Net Smelter Returns" means the proceeds received by REI from any
smelter or other purchaser from the sale of any ores, concentrates
or minerals produced from the Claim after deducting from such
proceeds the following charges only to the extent that they are not
deducted by the smelter or other purchaser in computing the
proceeds:
(i) the cost of transportation of the ores, concentrates or
minerals from the Claim to such smelter or other purchaser,
including related transport;
(ii) smelting and refining charges including penalties; and
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(iii) marketing costs.
(d) "Option" means the option granted by Vendor to REI pursuant to
Section 3;
(e) "Operating the Claim as a mine" or "Operation of the Claim as a
mine" means any or all of the mining, milling, smelting, refining
or other recovery of ores, minerals, metals or concentrates or
values thereof, derived from the Claim;
(f) "Dollars ($)" means legal currency of Canada.
2. REPRESENTATIONS AND WARRANTIES
2.1 REI represents and warrants to Vendor that:
(a) REI is a body corporate duly incorporated, organized and validly
subsisting under the laws of its incorporating jurisdiction;
(b) REI has full power and authority to carry on its business and to
enter into this Agreement and any agreement or instrument referred
to or contemplated by this Agreement;
(c) neither the execution and delivery of this Agreement nor any of the
agreements referred to herein or contemplated hereby, nor the
consummation of the transactions hereby contemplated will conflict
with, result in the breach of or accelerate the performance
required by any agreement to which REI is a party; and
(d) the execution and delivery of this Agreement and the agreements
contemplated hereby will not violate or result in the breach of
laws of any jurisdiction applicable or pertaining thereto or of
REI's contenting documents.
2.2 Vendor represents and warrants to REI:
(a) the Claim consists of the mineral claims Pretty Girl 3 and Pretty
Girl 4 located in the Pretty Girl mineral claim group in the Golden
Mining Division of the Ministry of Sustainable Resource Management,
west of Invermere, British Columbia, Canada which has been duly and
validly staked and recorded, as accurately described in Schedule
"A", is presently in good standing under the laws of the
jurisdiction in which it is located and, except as set forth
herein, is free and clear of all liens, charges and encumbrances;
(b) Vendor is the sole beneficial owner of a 100% interest in and to
the Claim and has the exclusive right to enter into this Agreement
and all necessary authority to dispose of an undivided 100%
interest in and to the Claim in accordance with the terms of this
Agreement;
(c) no person, firm or corporation has any proprietary or possessory
interest in the Claim other than Vendor and no person is entitled
to any royalty or other payment in the nature of rent or royalty on
any minerals, ores, metals or concentrates or any other such
products removed from the Claim;
(d) neither the execution and delivery of this Agreement nor any of the
agreements referred to herein or contemplated hereby, nor the
consummation of the transactions hereby contemplated will conflict
with, result in the breach of or accelerate the performance
required by any agreement to which Vendor is a party or by which he
is bound;
(e) the execution and delivery of this Agreement and the agreements
contemplated hereby will not violate or result in the breach of the
laws of any jurisdiction applicable or pertaining thereto.
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2.3 The representations and warranties hereinbefore set out are conditions on
which the parties have relied in entering into this Agreement and will
survive the acquisition of any interest in the Claim by REI and each
party will indemnify and save the other party harmless from all loss,
damage, costs, actions and suits arising out of or in connection with any
breach or any representation, warranty, covenant, agreement or condition
made by the other party and contained in this Agreement.
3. OPTION
3.1 Vendor hereby gives and grants to REI the sole and exclusive right and
option to acquire an undivided 100% of the right, title and interest of
Vendor in and to the Claim, subject only to Vendor receiving the annual
payments in accordance with the terms of this Agreement for and in
consideration of the following:
(a) REI, or its permitted assigns, incurring exploration expenditures
on the Claims of a minimum of $12,500 on or before March 31, 2008;
and
(b) REI, or its permitted assigns, incurring exploration expenditures
on the Claims of a further $45,000 (for aggregate minimum
exploration expenses of $57,500) on or before March 31, 2009; and
3.2 Upon exercise of the Option, REI agrees to pay Vendor, commencing July 1,
2009, the sum of $35,000 per annum for so long as REI, or its permitted
assigns, holds any interest in the Claims. Failure to make any such
annual payment shall result in termination of this Agreement in
accordance with Section 5.1.
4. RIGHT OF ENTRY
4.1 Until such time as the Option has been exercised, REI, its employees,
agents and independent contractors, will have the sole and exclusive
right and option to:
(a) enter upon the Claims;
(b) have exclusive and quiet possession thereof;
(c) do such prospecting, exploration, development or other mining work
thereon and thereunder as REI in its sole discretion may consider
advisable; and
(d) bring and erect upon the Claims such facilities as REI may consider
advisable.
5. TERMINATION
5.1 Subject to Section 8, this Agreement and the Option will terminate:
(a) on March 31, 2008 at 11:59 P.M., unless on or before that date, REI
has incurred exploration expenditures of a minimum of $12,500 on
the Claims;
(b) on March 31, 2009 at 11:59 P.M., unless REI has incurred a further
$45,000 of exploration expenditures on the Claims (for an aggregate
of $57,500); or
(c) at 11:59 P.M. on July 1 of each and every year, commencing on July
1, 2009, unless REI or its successor or assign has paid to Vendor
the sum of $35,000 on or before that date.
6. COVENANTS OF VENDOR
6.1 Vendor will:
(a) not do any act or thing which would or might in any way adversely
affect the rights of REI hereunder;
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(b) make available to REI and its representatives all records and files
in the possession of Vendor relating to the Claims and permit REI
and its representatives at its own expense to take abstracts
therefrom and make copies thereof; and
(c) promptly provide REI with any and all notices and correspondence
from government agencies in respect of the Claims.
7. COVENANTS OF REI
7.1 REI will:
(a) keep the Claims free and clear of all liens, charges and
encumbrances arising from their operations hereunder and in good
standing by the doing and filing of all necessary work and by the
doing of all other acts and things and making all other payments
which may be necessary in that regard;
(b) permit Vendor, or its representatives duly authorized by it in
writing, at their own risk and expense, access to the Claims at all
reasonable times and to all records prepared by REI in connection
with work done on or with respect to the Claims;
(c) conduct all work on or with respect to the Claims in a careful and
miner-like manner and in compliance with all applicable Federal,
Provincial and local laws, rules, orders and regulations, and
indemnify and save Vendor harmless from any and all Claims, suits,
actions made or brought against it as a result of work done by REI
on or with respect to the Claims; and
(d) 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.
8. EXERCISE OF OPTION
8.1 Once REI has incurred the exploration expenditures, and made the payments
set out in Section 3.1, REI will, subject to the right of Vendor to
receive the obligation of REI to make the annual payments set out in
Section 3.2, own an undivided 100% of Vendor's right, title, and interest
in and to the Claims.
9. OBLIGATIONS OF REI AFTER TERMINATION
9.1 In the event of the termination of the Option, REI will:
(a) leave the Claims in good standing for a minimum of one (1) year
under all applicable legislation, free and clear of all liens,
charges and encumbrances arising from this Agreement or their
operations hereunder and in a safe and orderly condition;
(b) deliver to Vendor within 60 days of its written request a
comprehensive report on all work carried out by REI on the Claims
(limited to factual matter only) together with copies of all maps,
drill logs, assay results and other technical data compiled by REI
with respect to the Claims;
(c) have the right, and obligation on demand made by Vendor, to remove
from the Claims within six (6) months of the effective date of
termination all facilities erected, installed or brought upon the
Claims by or at the instance of REI provided that at the option of
Vendor, any or all of facilities not so removed will become the
property of Vendor; and
(d) deliver to Vendor a duly executed transfer in registrable form of
an undivided 100% right, title and interest in and to the Claims in
favor of Vendor, or its nominee.
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10. TRANSFER OF TITLE
10.1 Upon the request of REI, Vendor will deliver to REI a duly executed
transfer in registrable form of an undivided 100% of Vendor's right,
title and interest in and to the Claims in favor of REI which REI will be
entitled to register against title to the Claims provided that transfer
of legal title to the Claims as set forth in this Subsection 10.1 is for
administrative convenience only and beneficial ownership of an undivided
100% interest in the Claims will pass to REI only in accordance with the
terms and conditions of this Agreement.
11. REGISTRATION OF AGREEMENT
11.1 Notwithstanding Section 10 of this Agreement, REI or Vendor will have the
right at any time to register this Agreement or a Memorandum thereof
against title to the Claims.
12. DISPOSITION OF CLAIMS
12.1 REI may at any time sell, transfer or otherwise dispose of all or any
portion of its interest in and to the Claims and this Agreement provided
that, at any time, REI has first obtained the consent in writing of
Vendor, such consent not to be unreasonably withheld and further provided
that, at any time during the currency of this Agreement, any purchaser,
grantee or transferee of any such interest will have first delivered to
Vendor its agreement related to this Agreement and to the Claims,
containing:
(a) a covenant with Vendor by such transferee to perform all the
obligations of REI to be performed under this Agreement in respect
of the interest to be acquired by it from REI, and
(b) a provision subjecting any further sale, transfer or other
disposition of such interest in the Claims and this Agreement or
any portion thereof to the restrictions contained in this
Subsection 12.1.
12.2 The provisions or Subsection 13.1 of this Agreement will not prevent
either party from entering into an amalgamation or corporate
reorganization which will have the effect in law of the amalgamated or
surviving company possessing all the property, rights and interests and
being subject to all the debts, liabilities and obligations of each
amalgamating or predecessor company.
13. ABANDONMENT OF PROPERTY
13.l REI shall have the unfettered right at any time after the exercise of the
Option to abandon all or any part of its interest in the Claims by
delivering a notice in writing of their intention to do so to Vendor,
such notice to list the part or parts of the Claims to be abandoned, and
if within 30 days of receipt of such notice Vendor delivers to REI a
notice ("Reacquisition Notice") stating its intention to reacquire all or
part or parts of the Claims, REI will deliver to Vendor duly executed
recordable transfers of its interest in such part or parts of the Claims
as Vendor has set forth in the Reacquisition Notice, such part or parts
to be in good standing for at least one year beyond the date of delivery
of such transfers and to be free and clear of all liens, charges, and
encumbrances arising from the operations of REI or its agents or
subcontractors hereunder.
14. CONFIDENTIAL NATURE OF INFORMATION
14.1 The parties agree that all information obtained from the work carried out
hereunder and under the operation of this Agreement will be the exclusive
property of the parties and will not be used other than for the
activities contemplated hereunder except as required by law or by the
rules and regulations of any regulatory authority having jurisdiction, or
with the written consent of both parties, such consent not to be
unreasonably withheld. Notwithstanding the foregoing, it is understood
and agreed that a party will not be liable to the other party for the
fraudulent or negligent disclosure of information by any of its
employees, servants or agents, provided that such party has taken
reasonable steps to ensure the preservation of the confidential nature of
such information.
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15. FURTHER ASSURANCES
15.1 The parties hereto agree that they and each of them will execute all
documents and do all acts and things within their respective powers to
carry out and implement the provisions or intent of this Agreement.
16. NOTICE
16.1 Any notice, direction or other instrument required or permitted to be
given under this Agreement will be in writing and will be given by the
delivery or the same or by mailing the same by prepaid registered or
certified mail in each case addressed as follows:
(a) if to VENDOR
0000 Xxxxxxxxx Xxxx, Xxxx Xxxxxxxxx, Xxxxxxx Xxxxxxxx, Xxxxxx
X0X 0X0
ATTENTION : XXXXXX XXXX
(b) if to RIVER EXPLORATION, INC.
000 Xxxxx Xxxxxx Xxxxxx, Xxxxxx Xxxx, Xxxxxx 00000
16.2 Any notice, direction or other instrument aforesaid will, if delivered,
be deemed to have been given and received on the day it was delivered,
and if mailed, be deemed to have been given and received on the fifth
business day following the day of mailing, except in the event of
disruption of the postal services in which event notice will be deemed to
be received only when actually received.
16.3 Any party may at any time give to the other notice in writing of any
change of address of the party giving such notice and from and after the
giving of such notice, the address or addresses therein specified will be
deemed to be the address of such party for the purpose of giving notice
hereunder.
17. HEADINGS
17.1 The headings to the respective sections herein will not be deemed part of
this Agreement but will be regarded as having been used for convenience
only.
18. DEFAULT
18.1 If any party (a "Defaulting Party") is in default of any requirement
herein set forth other than the provisions of Section 5 for which notice
of default need not be given, the party affected by such default will
give written notice to the defaulting Party specifying the default and
the Defaulting Party will not lose any rights under this Agreement,
unless within 30 days after the giving of notice of default by the
affected party the Defaulting Party has cured the default by the
appropriate performance and if the Defaulting Party fails within such
period to cure any such default, the affected party will be entitled to
seek any remedy it may have on account of such default.
19. PAYMENT
19.1 All references to monies hereunder will be in Canadian funds except where
otherwise designated. All payments to be made to any party hereunder will
be mailed or delivered to such party at its address for notice purposes
as provided herein, or for the account of such party at such bank or
banks in Canada as such party may designate from time to time by written
notice. Said bank or banks will be deemed the agent of the designating
party for the purpose of receiving and collecting such payment.
20. ENUREMENT
20.1 Subject to Section 13, this Agreement will ensure to the benefit of and
be binding upon the parties hereto and their respective successors and
permitted assigns.
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21. TERMS
21.1 The terms and provisions of this Agreement shall be interpreted in
accordance with the laws of British Columbia.
22. FORCE MAJEURE
22.1 No party will be liable for its failure to perform any of its obligations
under this Agreement due to a cause beyond its control (except those
caused by its own lack of funds) including, but not limited to acts of
God, fire, flood, explosion, strikes, lockouts or other industrial
disturbances, laws, rules and regulations or orders of any duly
constituted governmental authority or non- availability of materials or
transportation (each an "Intervening Event").
22.2 All time limits imposed by this Agreement, other than those imposed by
Section 5, will be extended by a period equivalent to the period of delay
resulting from an Intervening Event described in Subsection 23.1.
22.3 A party relying on the provisions of Subsection 23.1 will take all
reasonable steps to eliminate an Intervening Event and, if possible, will
perform its obligations under this Agreement as far as practical, but
nothing herein will require such party to settle or adjust any labor
dispute or to question or to test the validity of any law, rule,
regulation or order of any duly constituted governmental authority or to
complete its obligations under this Agreement if an Intervening Event
renders completion impossible.
23. ENTIRE AGREEMENT
23.1 This Agreement constitutes the entire agreement between the parties and
replaces and supersedes all prior agreements, memoranda, correspondence,
communications, negotiations and representations, whether verbal or
written, express or implied, statutory or otherwise between the parties
with respect to the subject matter herein.
24. TIME OF ESSENCE
24.1 Time will be of the essence in this Agreement.
25. ENFORCEMENT OF AGREEMENT
25.1 The covenants, promises, terms and conditions contained herein will be
binding upon the parties jointly and severally and may be enforced by
each as against each other inter se.
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IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the day
and year first above written.
XXXXXX XXXX
/s/ Xxxxxx Xxxx
___________________________________________________________________
By:
/s/ Xxxxx Xxxxxx
___________________________________________________________________
Signature of Witness
Xxxxx Xxxxxx
___________________________________________________________________
Printed Name of Witness
RIVER EXPLORATION, INC.
/s/ Xxxxxx Xxxx
___________________________________________________________________
Per:
by its Authorized Signatory: Xxxxxx Xxxx, President
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This is SCHEDULE "A" to an Agreement made as of the 31st day of December, 2006
between VENDOR and RIVER EXPLORATION, INC.
Staked Claims Event No. 4115867 and 4116009, Tenure Numbers: 534948, 535190.
Claims known as Pretty Girl 3 and Pretty Girl 4. These claims are located
approximately 00 xxxxxxxxxx xxx xxxx xx Xxxxxxxxx, XX Xxxxxx. The claims occupy
a large spur between Law Creek to the north and Xxxxx Creek to the south. The
property lies within NTS mapsheet 82K/8 and 82K/9 at latitude 50(degree)
31'north, longitude 116(degree) 18'west.
