DATED 28 October 2005
---------------------
CARBON INVESTMENTS LIMITED (1)
and
CENTURION GOLD HOLDINGS, INC (2)
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JOINT VENTURE AGREEMENT
RELATING TO OIL & GAS LEASES
OVER THE KITCHEN AND
EAST KITCHEN PROSPECTS
IN THE XXXX INLET IN ALASKA
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GSC Solicitors
00-00 Xxx Xxxxx
Xxxxxx XX0X 0XX
Tel: 000 0000 0000
Fax: 000 0000 0000
Ref: JHB KJ
THIS AGREEMENT is dated 28 October 2005
PARTIES
CARBON INVESTMENTS LIMITED, a company registered under the laws of the Turks &
Caicos Islands with company number E35160 whose registered office is at Xxxxxxx
Xxxxx, Xxxx Xxxxxx, Xxxxx Xxxx, Turks & Caicos Islands, British West Indies
("Carbon"); and
CENTURION GOLD HOLDINGS, INC, a company registered under the laws of Florida USA
with company number 00-0000000 whose registered office is at Mainreef Road,
Primrose, South Africa ("Centurion").
WHEREAS
1. This Agreement is supplemental to an agreement between Centurion and
Escopeta Oil Co., LLC, ("Escopeta") a Texas Corporation dated 17 October
2005 ("the Escopeta Agreement") a copy of which is attached as Annexe "A"
whereby Centurion agreed to purchase an undivided 75% interest ("the
Rights") in the oil & gas leases referred to in the Schedule thereto ("the
Oil & Gas Leases").
2. Carbon has experience in introducing natural resource companies to listing
on AIM on the London Stock Exchange and has contacts with Financial
Advisers who wish to assist Centurion in listing the Rights on AIM.
3. Carbon also has access to third parties and investors who may be
interested in financing the exploitation of the Rights.
4. The Parties have agreed to enter into a joint venture for the exploitation
of the Rights and the Oil & Gas Leases together with Escopeta on the terms
and upon the conditions set out below.
NOW IT IS AGREED as follows
1. Joint Venture
Subject as follows the Parties have agreed to joint venture the
exploitation of the Rights under the Escopeta Agreement in the proportion
as to 60% to Carbon and 40% to Centurion ("the Joint Venture Ratios").
2. All assignments and other documents to be entered into by Centurion
pursuant to the terms of the Escopeta Agreement shall be documented in the
names of the Parties and the Parties shall do all acts and things so as to
give effect to the terms of this Agreement.
3. Immediately following execution of this Agreement Centurion shall give
notice of this Agreement and its terms to Escopeta and due notice of the
Agreement shall (if possible) be registered in the relevant land authority
in Alaska where the Oil & Gas Leases were initially issued and registered.
4. Financing of the Escopeta Agreement
Centurion will finance and make all payments due to Escopeta under the
terms of the Escopeta Agreement on a timeous basis and do all acts and
things necessary to preserve the Rights under the Escopeta Agreement.
5. Notwithstanding the provisions of paragraph 4 above the Parties shall
procure that all costs and charges incurred by Centurion in connection
with the Escopeta Agreement are reimbursed to Centurion in the Joint
Venture Ratios at the time of a sale of the Rights pursuant to paragraph
7. below or if a sale is not effected before any division of revenue to
the Parties pursuant to paragraph 10. below.
6. Notwithstanding the provisions of paragraphs 4. and 5. above the Parties
shall mutually cooperate to secure funding for Centurion to enable
Centurion to fund all payments due and payable under the Escopeta
Agreement.
7. Sale of the Rights
The Parties will use their respective best endeavours to procure the
Rights will be sold by Centurion to a listed company in the UK or
elsewhere for a consideration to be established following completion of a
Competent Valuation Report to be commissioned by Centurion.
8. Conduct of the Sale/Listing of the Rights
The Parties shall mutually cooperate to secure a sale of the Rights
pursuant to paragraph 7. above and Centurion will expeditiously appoint
all and any necessary professional advisers to effect such sale.
9. Competent Valuers Report
Centurion will coordinate the preparation of the Competent Valuation
Report as soon as practicably possible with the intent that such Report
shall be available by no later than 31 December 2005 with an Executive
Summary Report giving estimates of the reserves within the Prospects
contained within the Oil & Gas Leases being completed as soon as possible.
10. Conduct of Joint Venture in the event of no Sale
In the event that the Parties are not successful in coordinating and
securing a sale of the Rights Centurion shall fulfil its obligations under
the Escopeta Agreement.
11. Option
In consideration of the introduction by Carbon of Centurion to Escopeta,
Centurion hereby grants to Carbon an option to purchase 20 million shares
of common stock in the capital of Centurion at an option price of 50 cents
per share exercisable by Carbon at any time within one year from the date
hereof on the giving of notice in writing to Centurion.
12. Restrictions
12.1 Centurion shall not without the prior written approval of Carbon:
12.1.1 sell, transfer, lease, assign or otherwise dispose of the Rights or
any part thereof (or any interest therein), or contract so to do
whether or not for valuable consideration;
12.1.2 mortgage encumber, pledge or otherwise charge the Rights or any
part thereof (or any interest therein), or contract so to do;
12.1.3 do or permit or suffer to be done any act or thing whereby
Centurion may be wound up (whether voluntarily or compulsorily);
12.1.4 enter into any contract or transaction relating to the Rights
except in accordance with the terms of this Agreement and in on the
ordinary and proper course of its business in promoting and
developing the Rights on arm's length terms;
12.1.5 borrow or raise money secured on the Rights;
12.1.6 take major decisions relating to the Rights (in excess of US$10,000
being regarded as material for these purposes);
12.1.7 incur capital expenditure in respect of the Rights (in excess of
US$10,000 or such other sum as may be agreed between the Parties
from time to time); and
12.1.8 hold any meeting with Escopeta or purport to transact any business
at any such meeting unless there are present duly authorised
representatives or proxies for Carbon.
13. Warranties and Indemnity
In consideration of Carbon agreeing to enter into this Agreement
Centurion, warrants and undertakes to Carbon that each of the warranties
("the Warranties") set out in the Schedule is true complete and accurate
in all respects and is not misleading and Centurion agrees and
acknowledges that Carbon is entering into this Agreement in reliance on
the Warranties and that Carbon may treat the same as conditions of this
Agreement;
14. Each of the Warranties shall be separate and independent and shall not be
limited by reference to any other paragraph or sub-paragraph or anything
in this Agreement; and
Centurion covenants with and undertakes to Carbon to indemnify Carbon
against all losses, costs, charges and expenses (including without
limitation all legal and accountancy expenses) which Carbon may incur
whether before or after the start of any action in connection with the
investigation or settlement of a claim against Centurion in respect of a
breach or the enforcement of a settlement and legal proceedings against
Centurion in respect of a breach of the Warranties or a breach of this
Agreement or a breach of the Escopeta Agreement.
15. Event of Default
15.1 There shall be an event of default ("Event of Default"):
15.1.1 if Centurion fails to observe or perform any other obligations
under this Agreement or the Escopeta Agreement or Centurion is or
becomes in breach of any Warranty; or
15.1.2 if a receiver or administrative receiver or manager is appointed of
or in relation to Centurion or the whole or any part of Centurion's
undertaking assets rights or revenues or Centurion's directors
request any person to make any such appointment; or
15.1.3 if an encumbrancer takes possession of or a distress execution
sequestration or process is levied or enforced upon the whole or any
part of Centurion's undertaking assets rights or revenues; or
15.1.4 if Centurion ceases to carry on the whole or a substantial part of
its business or stops or suspends payment of its debts or proposes
or enters into any composition scheme compromise or arrangement with
or for the benefit of its creditors generally or any class of them;
or
15.1.5 if an application is made or a petition is presented by any person
to any court for an administration order in relation to Centurion;
or
15.1.6 if Centurion is (or admits that it is) unable to pay its debts as
they fall due or are deemed unable to pay its debts under section
123(1) of the Insolvency Xxx 0000; or
15.1.7 if Centurion becomes insolvent or any petition is presented by any
person or any order is made by any court or any meeting is convened
for the purpose of considering a resolution or any resolution is
passed for its winding-up liquidation or dissolution; or
15.1.8 if any of Centurion's shareholders issues a petition pursuant to
Xxxxxxx 000 Xxxxxxxxx Xxx 0000; or
15.1.9 if any circumstances arise which in Carbon's opinion has or may
have a material adverse effect on Centurion's ability to perform its
obligations under this Agreement or the Escopeta Agreement; or
15.1.10 if there is a change in the ownership or control of Centurion
(except where Carbon's prior written consent has been obtained); or
15.1.11 any event described in paragraphs 15.1.2 to 15.1.8 inclusive above
or any analogous event occurs to the Company in any other
jurisdiction.
15.2 If any Event of Default shall occur and be continuing after a period of 14
days following notice of an Event of Default being given by Carbon to
Centurion, then Carbon shall cease to be under any further commitment to
Centurion and Carbon may at any time thereafter (notwithstanding any
conflicting agreement or arrangement) declare that this Agreement shall be
terminated with immediate effect in which case Carbon shall have the right
to acquire its 60% interest in the Rights for a sum of US$1.
16. Invalidity of part of Agreement
In the event that there shall be a final adjudication that any provisions
or provision of this Agreement is, are or shall be invalid, illegal or
contrary to public policy such adjudication shall not affect any of the
other provisions of this Agreement which other provisions shall continue
in full force and effect.
17. Notices
17.1 Any notice to be given pursuant to this Agreement shall be in writing and
sent by registered or recorded delivery return receipt requested. Any
notice to a party shall be sent to the address of such party as set out in
this Agreement or to such other address as such party may have designated
by notice pursuant to this paragraph.
18. Duration and assignment
18.1 This Agreement shall supersede any previous agreements between the Parties
(including specifically the agreement between the Parties dated 7 October
2005 which has been cancelled) and this Agreement shall continue in full
force and effect until:
18.1.1 the date on which the Parties have concluded a sale of the Rights
in accordance with the provisions of paragraph 7. above; or
18.1.2 the date on which the Parties have successfully exploited the
Rights under the Escopeta Agreement in accordance with the
provisions of paragraph 10. above; or
18.1.3 the date of commencement of Centurion's winding up; or
18.1.4 the occurrence of an Event of Default.
18.2 Centurion shall not be entitled to assign this Agreement or any of its
rights and obligations under it or any of its interest in the Rights
unless such assignment has previously been agreed in writing by Carbon.
18.3 This Agreement shall enure for the benefit of and be binding upon the
respective successors in title and/or personal representatives and/or
permitted assigns of the Parties.
19. Costs
Centurion shall be responsible for the payment of all professional fees
incurred by the Parties in connection with the negotiation preparation and
completion of this Agreement.
20. Governing Law
This Agreement should be governed by the laws of England & Wales and the
Parties shall submit themselves to the exclusive jurisdiction of England &
Wales
As Witness the Parties have set their hands the day and year first above written
Signed by Xxxxxx Xxxxxxx )
for and on behalf of )
Carbon Investments Limited )
In the presence of )
Signed by Xxxx Xxxx )
for and on behalf of )
Centurion Gold Holdings, Inc )
In the presence of )
SCHEDULE
Warranties
1. All information contained in this Agreement and all other information
relating to Centurion is true, accurate and complete in every respect and
there is no fact or matter which renders any such matters or information
untrue, incomplete or misleading or the disclosure of which might
reasonably affect the willingness of Carbon to enter into this Agreement.
2. Centurion has full power and authority to enter into and perform this
Agreement and the Escopeta Agreement and this Agreement and the Escopeta
Agreement constitute valid and binding obligations on Centurion in
accordance with their terms.
3. The entry into this Agreement or the Escopeta Agreement or performing the
obligations in such agreements has not resulted nor will result in the
breach of any obligation of Centurion under:
3.1 its memorandum or articles of association, statutes, bye laws or
other terms of charter or corporate regulation;
3.2 any law or any order, judgment or decree of any court or
governmental agency including all relevant regulations of the
Securities Exchange Commission in the United States of America; or
3.3 any contract, undertaking or agreement.
4. Centurion is entitled to enter into this Agreement and the Escopeta
Agreement without the consent of any third party.
5 Centurion has conducted and is conducting its business in accordance with
all applicable laws and regulations and Centurion is not in breach of any
order, decree or judgement of any court or any governmental or regulatory
authority.
6 Centurion is not a party to any litigation or arbitration proceedings or
any regulatory proceedings before any tribunal, assessor or expert in any
jurisdiction and there are no proceedings of any of the aforesaid kind
pending or threatened either by or against Centurion and there are no
facts or circumstances which are likely to give rise thereto nor is there
any dispute with any revenue authority in relation to the affairs of
Centurion.
7 No distress, execution or other process has been levied in respect of
Centurion which remains undischarged and there is no unsatisfied judgement
or Court order outstanding against Centurion.
8 No receiver or manager has been appointed of the whole or any part of the
assets or undertakings of Centurion.
9 No meeting has been convened at which a resolution will be proposed, no
resolution has been passed, no petition has been presented and no order
has been made for the winding up of Centurion.
ANNEXE "A"
The Escopeta Agreement
["to be attached"]
