EXHIBIT 10.7
DATED ___________, 2004
KEYGOLD CORPORATION
the Grantor
AND
[o]
the Grantee
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DEED OF PUT OPTION
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THIS DEED OF PUT OPTION (the "Deed") is made on the ____________________________
day of 2004
BETWEEN:
(1) Keygold Corporation, a corporation duly organised and existing under the
laws of __________________ with its registered address at
_______________________ and quoted on the OTC Bulletin Board (the
"GRANTOR");
AND
(2) [o, a limited liability company incorporated under the laws of
________________________________, having its registered office at
_____________________/o, an individual Passport No. ________ residing at
________________________________________ (the "GRANTEE").
WHEREAS:
(A) JHP Resources Limited (the "COMPANY") is a company incorporated under the
laws of the Province of the British Columbia, Canada whose place of
business is at #000-0000 Xxxxxx Xxx, Xxxxxxxx, X.X. Canada V6V 1N3;
(B) The Grantor has entered into a Subscription Agreement dated ___________
_____________, 2004 (the "AGREEMENT") to subscribe for up to 8,000 Series
A Shares;
(C) The Company shall have as at the date of the First Completion (as defined
in the Agreement) an authorised capital consisting of a class of ordinary
shares ("ORDINARY SHARES") and a class of Series A convertible preferred
shares (the "SERIES A SHARES");
(D) The Grantee is the beneficial owner of 2,000 Ordinary Shares (the "OPTION
SHARES"); and
(E) The Grantor has agreed to grant to the Grantee the right to require the
Grantor to purchase the Option Shares in consideration for the allotment
and issue of 3,500,000 common shares of the Grantor (the "CONSIDERATION
SHARES") to the Grantee.
NOW, THEREFORE, in consideration of the mutual promises and covenants made
herein the parties agree as follows:
1. GRANT OF OPTION
1.1. The Grantor hereby irrevocably grants unto the Grantee the right during
the Option Period (as defined in Clause 6) to require that the Grantor
purchase from the Grantee all but not some only of the Option Shares
subject to the terms and conditions set forth herein (the "OPTION").
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2. EXERCISE OF PUT OPTION
2.1. The Grantee may exercise this Option provided that:
(a) the market capitalization of the Grantor as calculated by
multiplying the number of issued shares of the Grantor by the market
price of the shares of the Grantor quoted on the OTC Bulletin Board
equals or exceeds US$120,000,000; and
(b) the Grantee delivers a demand in writing to exercise the Option
substantially in the form attached hereto as Schedule 1 (the
"EXERCISE LETTER") to the Grantor.
3. CONSIDERATION
3.1. The consideration to be paid by the Grantor to the Grantee for the
purchase of the Option Shares by the Grantor shall be satisfied by the
allotment and issue to the Grantee or its nominee(s) of the Consideration
Shares.
4. COMPLETION
4.1 Completion under this Deed ("COMPLETION") shall take place at 10:00 am in
the offices of the Grantor three (3) days following the receipt of the
Exercise Letter by the Grantor.
4.2 At Completion, the Grantor shall deliver or cause to be delivered to the
Grantee:
(a) share certificates for the Consideration Shares;
(b) a certified true copy of the board resolutions of the Grantor
approving the allotment and issue of the Consideration Shares to the
Grantee in accordance with the terms of this Deed;
(c) such waivers or consents as the Grantee may require to enable the
Grantee or its nominees to be registered as the holders of the
Consideration Shares; and
(c) such other documents as may be required to give to the Grantee good
title to the Consideration Shares and to enable the Grantee or its
nominees to become the registered holders thereof.
4.3 At Completion, the Grantee shall deliver or cause to be delivered to the
Grantor:
(a) duly executed instruments of transfer and sold notes in favour of
the Grantor accompanied by the relevant share certificates in
respect of the Option Shares;
(b) all powers of attorney or other authorities under which the
instruments of transfer and sold notes in respect of the Option
Shares have been executed;
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(c) a certified true copy of the board resolutions of the Grantee
approving the sale of the Option Shares to the Grantor in accordance
with the terms of this Deed;
(d) such waivers or consents as the Grantor may require to enable the
Grantor or its nominees to be registered as the holders of the
Option Shares; and
(e) such other documents as may be required to give to the Grantor good
title to the Option Shares and to enable the Grantor or its nominees
to become the registered holders thereof.
4.3 The Consideration Shares shall be allotted and issued to the Grantee fully
paid at Completion, free from all liens and encumbrances and with all
rights attaching to them pursuant to the Memorandum and Articles of
Association of the Grantor.
4.4 Unless waived by the Grantee, the Grantee shall not be obliged to complete
this Deed unless the Grantor is quoted on the OTC Bulletin Board or listed
either on the American Stock Exchange, the New York Stock Exchange or the
NASDAQ Stock Market as at the date of the Completion.
5. REPRESENTATIONS AND WARRANTIES
5.1 The Grantor hereby represents, warrants and undertakes as at the date of
this Deed, on the date of the Exercise Letter and at Completion to the
Grantee as follows:
(a) The Grantor is a company duly organized and validly existing under
the laws of , that all necessary actions required, corporate or
otherwise, have been undertaken and that all signatures, consents
and approvals have been procured for purposes of executing this Deed
and performance of its obligations hereunder.
(b) Particulars of the Grantor as at the date hereof are set out in Part
A of Schedule 2 and the authorized capital of the Grantor
immediately prior to the Completion as disclosed in Part 2 of
Schedule 2 is true accurate and complete for all material respects.
(c) The Consideration Shares that are being allotted and issued to the
Grantee hereunder will be duly and validly issued, fully paid, and
non-assessable when issued, and will be free of restrictions on
transfer other than restrictions on transfer under this Deed or the
Memorandum and Articles of Association of the Grantor or under the
applicable laws.
(d) The Consideration Shares shall have demand registration rights that
permit the holder to demand within the two (2) weeks of acquiring
such Consideration Shares that the Grantor file a registration
statement within 45 days of the demand and require the Grantor to
use commercially reasonable efforts to prosecute the registration of
the Consideration Shares in compliance with the United States
Securities Act of 1933.
(e) There are no other outstanding options, warrants, rights (including
conversion or preemptive rights and rights of first refusal), proxy
or agreements among members or agreements of any kind for the
purchase or acquisition from the Grantor of any of its securities.
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(f) Compliance with the terms of this Deed does not and will not
conflict with, or result in the breach of, or constitute a default
under any agreement or instrument to which the Grantor is a party,
or any provision of the Memorandum and Articles of Association of
the Grantor or constitutional documents or any encumbrance, lease,
contract, order, judgement, award, injunction, regulation or other
restriction or obligation by which the Grantor is bound or subject;
(g) The Grantor is not engaged in any litigation or arbitration
proceedings, as plaintiff or defendant, and there are no such
proceedings pending or threatened, either by or against the Grantor
and there are no facts which have been brought to the attention of
the Grantor indicating any such litigation or arbitration; and
(h) The Grantee is quoted on the OTC Bulletin Board or listed either on
the American Stock Exchange, the New York Stock Exchange or the
NASDAQ Stock Market.
5.2 The Grantee hereby represents, warrants and undertakes as at the date of
this Deed, on the date of the Exercise Letter and at Completion to the
Grantor that it is a company validly existing under the laws of , and that
the Option Shares are free from any and all liens and encumbrances and are
fully paid and freely transferable, without limitation, to the Grantor at
Completion and that all necessary actions required, corporate or
otherwise, have been undertaken and all signatures, consents and approvals
have been procured for purposes of writing, issuing and authorizing this
Option on the Option Shares and the delivery and transfer of the Option
Shares to the Grantee upon exercise of this Option.
6. TERM
6.1 The term of this Option (the "Option Period") shall commence on the date
of the First Completion (as defined in the Agreement) (the "Start Date")
and expire on the earlier of:
(a) the exercise of the option under the Deed of Call Option between the
Grantor and the Grantee and dated the , 2004; or
(b) the liquidation and winding up of the Grantee; or
(c) three (3) years from the Start Date.
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7. REGISTRATION OF THE CONSIDERATION SHARES
7.1 In the event that after Completion the Grantee as holder of the
Consideration Shares demands within the two (2) weeks of acquiring such
Consideration Shares that the Grantor register the Consideration Shares in
compliance with the United States Securities Act of 1933, the Grantor
shall as soon as practicable and in any event within 45 days of demand by
the Grantee file a registration statement and use commercially reasonable
efforts to prosecute such registration provided that there shall be no
penalty to the Grantor should the registration not be declared effective
at any point in time or ever.
8. GENERAL
8.1 Each party shall pay his or its own costs and disbursements of and
incidental to this Deed.
8.2 Each notice, demand or other communication given or made under this Deed
shall be in writing and delivered or sent to the relevant party at his or
its address or fax number set out below (or such other address or fax
number as the addressee has by five (5) days' prior written notice
specified to the other parties):
To the Grantor:
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Fax Number:
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Attention:
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To the Grantee:
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Fax Number:
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Attention:
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Any notice, demand or other communication so addressed to the relevant
party shall be deemed to have been delivered (a) if given or made by
letter, when actually delivered to the relevant address; and (b) if given
or made by fax, when despatched.
8.3 No failure or delay by a party in exercising any right, power or remedy
under this Deed shall operate as a waiver thereof, nor shall any single or
partial exercise of the same preclude any further exercise thereof or the
exercise of any other right, power or remedy. Without limiting the
foregoing, no waiver by a party of any breach by the other party of any
provision hereof shall be deemed to be a waiver of any subsequent breach
of that or any other provision hereof. If at any time any provision of
this Deed is or becomes illegal, invalid or unenforceable in any respect,
the legality, validity and enforceability of the remaining provisions of
this Deed shall not be affected or impaired thereby.
8.4 This Deed (together with any documents referred to herein) constitutes the
whole agreement between the parties and it is expressly declared that no
variations hereof shall be effective unless made in writing.
8.5 The provisions of this Deed including the representations, warranties and
undertakings herein contained, insofar as the same shall not have been
fully performed at Completion, shall remain in full force and effect
notwithstanding Completion.
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8.6 The Grantor and the Grantee shall do and execute or procure to be done and
executed all such further acts, deeds, things and documents as may be
necessary to give effect to the terms of this Deed.
8.7 This Deed shall be governed by and construed in accordance with the laws
of State of Nevada, United States of America and the parties hereby
irrevocably submit to the non-exclusive jurisdiction of the State of
Nevada, United States of America courts.
8.8 This Deed shall be binding on and enure to the benefit of the parties
hereto and their respective successors.
8.9 Except as permitted herein, no party hereto may assign or transfer any of
its rights or obligations under this Deed.
8.10 This Deed may be entered into by any party by executing a counterpart
hereof. All such counterparts when taken together shall constitute one and
the same instrument and this Deed shall only take effect upon the
execution by each of the parties hereto. This Deed may be executed by the
parties in original or telecopy produced by fax machine or other means of
electronic communication producing a printed copy.
8.11 The title and subheadings in this Deed have been resorted to only for
convenience and shall not adversely affect the rights and interests of the
parties.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF this Xxxx has been executed on the day and year first above
written.
SIGNED SEALED AND )
DELIVERED BY )
)
for and on behalf of )
Grantor )
in the presence of: )
)
SIGNED SEALED AND )
DELIVERED BY )
)
for and on behalf of )
Grantee )
in the presence of: )
)
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SCHEDULE 1
[Date]
[Name and address of the Keygold Corporation]
Dear Sirs,
We refer to the Deed of Put Option dated , 2004 (the "Deed") entered into
between us relating to the Option Shares. Terms and expressions used in this
Exercise Letter shall have the same meaning as defined in the Deed.
We hereby exercise the Option referred to in the Deed to require that you
purchase from us all but not some only of the 2,000 Option Shares in
consideration of the Consideration Shares and that the completion of the sale
and purchase of the Option Shares shall take place on __________________________
at _______ a.m./p.m. at ___________________________.
Yours faithfully,
For and on behalf of
[Grantee]
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SCHEDULE 2
(PART A)
PARTICULARS OF THE GRANTOR
(as at the date hereof)
1. REGISTERED OFFICE :
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2. DATE OF INCORPORATION :
3. COMPANY NUMBER :
4. PLACE OF INCORPORATION :
5. DIRECTORS :
6. AUTHORIZED SHARE CAPITAL :
7. ISSUED SHARE CAPITAL at the date hereof is held as follows:
NAME OF SHAREHOLDERS NO. OF SHARES HELD
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(PART B)
SHARE CAPITAL OF THE GRANTOR
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(immediately prior to Completion)
AUTHORIZED SHARE CAPITAL:
(PART C)
PARTICULARS OF THE GRANTOR
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(IMMEDIATELY AFTER COMPLETION)
1. REGISTERED OFFICE :
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2. NAME OF COMPANY:
3. DATE OF INCORPORATION:
4. PLACE OF INCORPORATION:
5. AUTHORISED SHARE CAPITAL:
6. PAID-UP SHARE CAPITAL:
7. SHAREHOLDERS:
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