AGREEMENT FOR SALE AND PURCHASE OF MINERAL RIGHTS WITH RETAINED ROYALTY RIGHTS
AGREEMENT
FOR SALE AND PURCHASE OF MINERAL RIGHTS
WITH
RETAINED ROYALTY RIGHTS
An
agreement for the sale and purchase of mineral rights with a retained royalty
right (“Agreement”) entered into this 27th
day of
February 2007 by and between Xxxxxx Xxxx as Trustee of the Tombstone Silver
Mines Secured Creditors Trust (“Seller”) and Tombstone Exploration Corporation
(“Buyer”).
RECITALS
Whereas,
Seller owns the mineral rights on the patented mining claims described on the
Exhibit “A” (“Mineral Rights”);
Whereas,
Seller desires to sell the Mineral Rights to Buyer and Buyer desires to purchase
the Mineral Rights from Seller.
COVENANTS
Therefore,
in consideration of the mutual promises and covenants set forth in this
Agreement, the Seller and Buyer agree as follows:
1.
Sale
and Purchase of Mineral Rights:
The
Seller shall sell the Mineral Rights to the Buyer and the Buyer shall purchase
the Mineral Rights from the Seller upon the terms and conditions set forth
in
this Agreement.
2.
Description
of Property:
The
Mineral Rights are described in attached Exhibit “A”.
3.
Purchase
Price:
The
purchase price for the Property shall be $10,000.00 cash and a royalty of one
and one-half percent (1 ½%) of the gross smelter returns on all minerals mined
from the Mineral Rights.
4.
Payment
of Cash Portion of the Purchase Price:
The
Buyer shall pay the $10,000.00 cash portion of the Purchase Price to the Seller
by wire transfer to the IOLTA trust account of Xxxxxx Xxxx, Attorney at Law.
Seller acknowledges the receipt of those funds. (“Closing”).
5.
Payment
of Royalty:
Buyer
shall pay the royalty to Seller quarterly. The amount due shall be computed
on
the smelter returns actually received by the Buyer during each calendar quarter
and shall be paid to the Seller by the last day of the first calendar month
following the end of a quarter. The royalties will be paid to the Seller’s
address set forth in Section 19.
6.
Notice
of Royalty:
Seller
may in its discretion record a “Notice Of Royalty” with the Cochise County
Recorder stating that Seller holds certain rights with regard to the Mineral
Rights.
7.
Closing:
The
Seller and Buyer will close the transaction by Seller recording the original
transfer documents with the Recorder of Cochise County, Arizona and by paying
the property taxes described in Section 10 to the Treasurer of Cochise County,
Arizona.
8.
Transfer
Documents:
Title to
the mineral rights shall be transferred by a quit claim deed and assignment
in
the general form of the document attached as Exhibit “B”.
9.
Recording
Transfer Documents:
The
Seller shall record the Transfer Documents and shall pay the cost of
recording.
10.
Unpaid
Property Taxes:
The
property taxes on the Mineral Rights for years 2001 through 2007 are unpaid.
Seller shall pay these taxes within thirty (30) days of the Closing Date and
shall provide Buyer with written confirmation of their payment within a
reasonable period of time.
11.
Assignment:
Either
party may assign its rights under this Agreement without the prior written
consent of the other.
12.
Duplicate
Originals:
The
parties shall execute duplicate originals of this Agreement and each shall
serve
as an original for all purposes.
13.
Seller’s
Warranty:
Seller
represents and warrants:
a.
Xxxxxx
Xxxx is the Seller’s trustee and is duly authorized to enter into the
transaction and to execute all documents required to close it.
b.
Xxxxxx
Xxxx is not aware of any liens or encumbrances on the Mineral Rights other
than
the tax liens described in Section 9.
13.
Buyer’s
Warranties:
Buyer
represents and warrants that It:
a.
It has
conducted all desired independent investigations and accepts
the
Mineral Rights as is.
b.
It
acknowledges that there are no Seller warranties of any kind except those
expressly
set forth in this Agreement.
c.
The
individual signing this Agreement on behalf of the Buyer is duly authorized
to
enter into the transaction and execute all documents required to close
it.
14.
Effective
Date:
If both
parties execute this Agreement at the same time, the
effective
date of this Agreement shall be that date. If one party signs this Agreement
at
a latter time than the other, the effective date shall be the date this
Agreement is executed by the last party to sign it.
15.
Governing
Law:
The
interpretation and enforcement of this Agreement shall be governed by Arizona
law.
16.
Entire
Agreement:
This
Agreement constitutes the entire agreement between the parties regarding the
sale and purchase of the Mineral Rights.
17.
Counting
Days:
All
references to days in this Agreement shall be construed to be calendar days.
18.
Extension
of Time Periods Ending on Weekends or Holidays:
If the
time period for taking a particular action ends on a Saturday, Sunday or
Holiday, the time period for taking the action shall be extended through the
next business day.
19.
Address:
The
parties addresses for the purpose of this Agreement are:
a.
Seller: Tombstone
Silver Mines Secured Creditors Trust
c/o
Xxxxxx Xxxx, Trustee
0000
Xxxx
Xxxxxxxxx Xxxx, #000
Xxxxxxxxxx,
XX 00000
b.
Buyer: Tombstone
Exploration Corporation
000
Xxxxxxxxxxx Xxxxx
Xxxxxx,
XX X0X 0X0
In
witness whereof, the parties have executed this Agreement on the dates following
their signatures:
SELLER:
Tombstone
Silver Mines Secured Creditors Trust
__________________________________
Xxxxxx
Xxxx, Trustee
BUYER:
Tombstone
Exploration Corporation
By:________________________________
Name:______________________________
Title:_______________________________
