Letter of Intent March 5,2010

Exhibit
10.1
Letter
of Intent
 
March
5,2010
 
Gentlemen:
 
This
letter confirms our agreement on the principal terms and conditions of Yale
Resources Ltd. ("Yale") proposing to grant an option to Silver America Inc.
("SILVER AMERICA") to acquire a property interest in the Xxxxxxxxx property in
Zacatcas State, Mexico, more particularly described in Schedule "B" attached
hereto (the "Property"). Each party understands and agrees that preparation and
execution of a definitive agreement is required and that it will contain the
Gems set forth in Schedule "A" and may include additional terms as Yale and
SILVER AMERICA might agree to after good faith negotiation. This Letter of
Intent is intended to be binding with respect to the matters discussed in
Schedule "A". This Letter of Intent may be executed in one or more counterparts,
each of which shall be deemed an original for all purposes.
 
            YALE RESOURCES
      LTD.
             
            By:
      
            /s/ Xxx
      Xxxxxxx
             
            Name :
      Xxx Xxxxxxx
             
            Title
      : President
             
            SILVER
      AMERICA INC.
             
            By:
      
            /s/ Xxxxxxxx
      Xxxxxxxx
             
            Name
      : Xxxxxxxx Xxxxxxxx
             
            Title
      : CFO, Director
             
1

Schedule
"A"
 
Yale
Resources Ltd. / SILVER AMERICA Inc.
 
 TERM SHEET 
 
March
5,2010
 
This term
sheet of the Letter of Intent sets forth the proposed terms and structure of a
transaction in which Yale will
grant an option to SILVER AMERICA to acquire a 90% interest in the Property.
This Letter of Intent is a binding
agreement. Any transaction will be subject in all respects to a fully negotiated
and executed definitive option
agreement (the "Definitive Agreement") and approval, if required, of the
appropriate regulatory bodies.
 
            1. Option
      Agreement 
            THE
      PARTIES AGREE to negotiate in good faith a Definitive Agreement to
      include the following terms and conditions;
          
            (a)

            Yale
      grants to SILVER AMERICA an Option for SILVER AMERICA to acquire a 90%
      undivided interest in the Property.
          
            To exercise the
      Option, SILVER AMERICA shall pay cash to Yale, issue common shares of
      SILVER AMERICA and fund exploration and development expenditures (the
      "Expenditures") on the Property (all amounts in US$) in the following
      manner:
          
            (i)

            pay
      the refundable amount of $10,000 to Yale upon the signing of
      this Letter of Intent;

            (ii)

            Pay
      an additional $10,000 and issue 100,000 common shares in the
      capital of SILVER AMERICA on signing of a Definitive Agreemsnt;

            (iii)

            on
      or before the 30th
      of June 2010 SILVER AMERICA will pay Yale
      $20,000 and issue an additional 100,000 common shares in the
      capital of SILVER AMERICA to Yale.

            (iv)

            on
      or before the 30th of
      December 2010 SILVER AMERICA will
      pay Yale $30,000 and issue an additional 100,000 common shares
      in the capital of SILVER AMERICA to Yale.

            (v)

            on
      or before the 30th of June
      2011 SILVER AMERICA will pay Yale
      $50,000, issue an additional 100,000 common shares in the capital
      of SILVER AMERICA to Yale and have minimum expenditures
      of $400,000 (with a minimum of 2,000 metres of ,
      drilling).

            (vi)

            on
      or before the 30th of
      December 2011 SILVER AMERICA will
      pay Yale $50,000 and issue an additional 100,000 common shares
      in the capital of SILVER AMERICA to Yafe.

            (vii)

            on
      or before the 30th of June
      2012 SILVER AMERICA will pay Yale
      $75,000 and issue an additional 100,000 common shares in the
      capital of SILVER AMERICA to Yale.

            (viii)

            on
      or before the 30th of
      December 2012 SILVER AMERICA will
      pay Yale $100,000, issue an additional 100,000 common shares
      in the capital of SILVER AMERICA to Yale and have minimum
      expenditures of an additional
    $700,000.

2

                (ix)

                on
      or before the 30th of
      June 2013 SILVER AMERICA will pay Yale
      $200,000 and issue an additional 100.000 common shares in
      the capital of SILVER AMERICA to Yale.

                (x)

                on
      or before the 30th of
      December 2013 SILVER AMERICA will
      pay Yale $355,000, issue an additional 200,000 common minimum
      expenditures of an additional $900,000. shares
      in the capital of SILVER AMERICA to Yale and
      have

                Any Expenditures greater than the minimum amount will be credited
      towards the next year.The common shares issued by SILVER AMERICA will be restricted as
      per the minimum requirements set by the appropriate regulatory
      body.If drilling has not started by die ln of June 2011 Yale will give 3 months notice to have a
      drill program started and if drilling has not started by the lsl of August 2011 the Agreement will be
      cancelled.
              
                (b)
                Upon
      the execution and exercise of the Option, Yale agrees to transfer a 90%
      undivided interest in the Property to the Mexican subsidiary of SILVER
      AMERICA.
              
                Yale will retain a 2% NSR (a total of 3% for the property) that can be
      bought out in entirety for US $2,000,000.Yale agrees to maintain all filings and payments on all claims
      within the Property in accordance with the laws of Mexico until such time
      as the Property is transferred to SILVER AMERICA- All such costs are to be
      reimbursed by SILVER AMERICA.
              
                (c) 
                Until
      the execution and exercise of the Option, the parties agree to the
      following:
              
                (i)

                Yale
      will be the operator of the Property and will charge a standard
      15% management fee on all Expenditures incurred on the
      Property;

                (ii)

                On
      an ongoing basis, Yale will budget for die project for each phase
      and receive 50% before starting each phase. The allocation of
      (he funds will be determined by mutual consent of both
      parties.

                (iii)

                That
      SILVER AMERICA will fund a minimum of $15,000 of exploration
      work (not just Expenditures) every quarter (e.g. Apr/May/Jun,).

                (iv)

                Yale
      will deliver to SILVER AMERICA a detailed account of work
      expenditures upon request, but not more often than
      every three
      (3) months;

                (v)

                Regardless
      of the amount of expenditures that have been committed,
      SILVER AMERICA will be responsible for paying the
      property taxes that are due
  bi-annualty.

3

                  2. Due Diligence
      Investigation
                  Yale agrees to make available and grant access to SILVER AMERICA
      and their representatives, any corporate, financial, geological or other
      information as is reasonably necessary to conduct a due diligence review
      of the Property- Yale shall take reasonable good faith efforts promptly to
      provide SILVER AMERICA or its representatives such documents as may
      reasonably be requested in writing. Yale will grant to SILVER AMERICA and
      ils consultants the right of entry to the Properly for the purpose of
      carrying out its due diligence review of the Property and to perform such
      investigations, surveys and tests as SILVER AMERICA deems desirable. The
      Closing of the Definitive Agreement is subject to SILVER AMERICA's satisfactory due diligence review of the
      Property.
                
                  3. Budgets and
      payments 
                  While
      Yale is Operator, Yale will provide SILVER AMERICA a budget for
      each successive phase of exploration and SILVER AMERICA agrees
  to:

                  (a)
      
                  approve
      and/or provide comments on the budget within fourteen (14)
      days;
                
                  (b)
                  give
      to Yale an advance of at least 50% of each budget within 30 days of its
      approval and that Yale will not start that next phase of exploration until
      the advance has been received;
                
                  Payment to Yale for
      each completed phase of exploration will be due within thirry (30) days of
      receipt of request from Yale and will be accompanied by a detailed
      breakdown of cosls.
                
                  If the complete
      funds are not received within thirty (30) days, Yale will have (he right
      to issue a letter of default for the amount owed and that if the funds
      have not been received within an additional thirty (30) days, Yale will
      have the right to terminate the Option. For greater clarity, if
      expenditures have not been refunded/paid to Yale within sixty (60) days
      from the date of the original request the agreement will be
      terminated.
                
                  4. Closing
      Conditions 
                  Conditions to
      Closing shall include, without limitation:
                
                  (i)
                  receipt of any
      necessary regulatory approvals;
                
                  (ii) 
                  SILVER
      AMERICA completing a due diligence review of the Property and SILVER
      AMERICA being satisfied, in its sole and absolute discretion, with the
      results of such a review and verification;
                
                  The
      parties agree to close the Definitive Agreement within sixty (60) days
      after the execution of this Letter of Intent and agree to extend the
      closing date for an additional thirty (30) days if there is a
      delay.
                
                  5. Disclosure
                  The
      parties are permitted to make any public announcement regarding this
      Letter of Intent or any transaction contemplated hereby as required by
      applicable securities law. 

                  6.
      No-Shop and Exclusive Provisions

                  Until sixty (60)
      days after the date of this Letter of Intent and in consideration for
      SILVER AMERICA's
      commitment of time and resources to perform due diligence, Yale
      will not, directly or indirectly, through any officer, director, employee,
      affiliate or agent or otherwise, take any action to solicit, initiate,
      seek, encourage or support any inquiry, proposal or offen from,
      furnish any information to, or participate in any negotiations with, any
      third party regarding the sale of the Property, or any plans to develop
      the Property. Yale agrees that my such negotiations
      (other than negotiations with SILVER AMERICA) in progress as of the date
      of this letter will be suspended during such period, and that Yale will
      not accept or enter into any agreement, arrangement or understanding for
      sale or option of the Properly or for the development of the Property
      during such period.

4

                If Yale or any of
      its officers, directors, employees, affiliates or agents receives any
      proposal for, or inquiry respecting, any third party acquisition of or
      development for the Property, Yale will promptly notify SILVER AMERICA,
      describing in detail the identity of the person making such proposal or
      inquiry and the terms and conditions of such proposal or
  inquiry.
              
                7. (a)
      Expenses      
                Otherwise
      stated herein. Yale and SILVER AMERICA shall each be liable for their
      own costs, including legal, accounting, and other such costs. incurred by
      each of them in the negotiation and closing of this transaction. SILVER
      AMERICA shall be responsible for all costs relating to its due diligence
      review of the Property.
              
      (b) Break-up Fee
                If within thirty
      (30) days from the date of this Letter of Intent or anytime 
      prior
      to the Closing of the Definitive Agreement, Yale fails to complete
      the terms
      outlined within this Letter of Intent, Yale will reimburse to SILVER
      AMERICA ail the expenses that have been incurred including the legal fees,
      due diligence expenses, taxes and disbursements incurred by SILVER AMERICA
      in relation to the review of the Property and drafting of the Definitive
      Agreement (and Joint Venture Agreement) and such reimbursement costs will
      not exceed $25,000.

                8. Area of
      Interest
                There
      will be no Area of Interest surrounding the Property.
              
                If Yale were to
      acquire a property or properties adjoining the Property, such
      property(ies) would be offered to SILVER AMERICA on a first right of
      refusal basis under terms similar to those within the Definitive
      Agreement.
              
                This Letter of
      Intent represents only the current thinking of the parties relating to the
      proposed transaction. All rights and obligations of the parties will be
      subject to negotiation and execution of a definitive agreement among the
      parties, completion of the due diligence, other matters set forth above,
      and the approval, if required, of the appropriate regulatory
    bodies.
              
5

Schedule
"B"- List of mineral concessions comprising the Property

            Concession  name
             
            Title   number
             
            Approx.
      Area (ha)
          
            XXXXXXXXX
             
            233872
             
            127.4100
          
            XXXXXXXXX
2
             
            233873
             
            155.4200
          
            Total:
             
            282.83
          
6

Document Metadata

Letter of Intent March 5,2010

Document Metadata

	YALE RESOURCES LTD.

	By:	/s/ Xxx Xxxxxxx
		Name : Xxx Xxxxxxx
		Title : President


	SILVER AMERICA INC.

	By:	/s/ Xxxxxxxx Xxxxxxxx
		Name : Xxxxxxxx Xxxxxxxx
		Title : CFO, Director

1. Option Agreement	THE PARTIES AGREE to negotiate in good faith a Definitive Agreement to include the following terms and conditions;

	(a)	Yale grants to SILVER AMERICA an Option for SILVER AMERICA to acquire a 90% undivided interest in the Property.

		To exercise the Option, SILVER AMERICA shall pay cash to Yale, issue common shares of SILVER AMERICA and fund exploration and development expenditures (the "Expenditures") on the Property (all amounts in US$) in the following manner:

		(i)	pay the refundable amount of $10,000 to Yale upon the signing of this Letter of Intent;

		(ii)	Pay an additional $10,000 and issue 100,000 common shares in the capital of SILVER AMERICA on signing of a Definitive Agreemsnt;

		(iii)	on or before the 30th of June 2010 SILVER AMERICA will pay Yale $20,000 and issue an additional 100,000 common shares in the capital of SILVER AMERICA to Yale.

		(iv)	on or before the 30th of December 2010 SILVER AMERICA will pay Yale $30,000 and issue an additional 100,000 common shares in the capital of SILVER AMERICA to Yale.

		(v)	on or before the 30th of June 2011 SILVER AMERICA will pay Yale $50,000, issue an additional 100,000 common shares in the capital of SILVER AMERICA to Yale and have minimum expenditures of $400,000 (with a minimum of 2,000 metres of , drilling).

		(vi)	on or before the 30th of December 2011 SILVER AMERICA will pay Yale $50,000 and issue an additional 100,000 common shares in the capital of SILVER AMERICA to Yafe.

		(vii)	on or before the 30th of June 2012 SILVER AMERICA will pay Yale $75,000 and issue an additional 100,000 common shares in the capital of SILVER AMERICA to Yale.
		(viii)	on or before the 30th of December 2012 SILVER AMERICA will pay Yale $100,000, issue an additional 100,000 common shares in the capital of SILVER AMERICA to Yale and have minimum expenditures of an additional $700,000.

	(ix)	on or before the 30th of June 2013 SILVER AMERICA will pay Yale $200,000 and issue an additional 100.000 common shares in the capital of SILVER AMERICA to Yale.

	(x)	on or before the 30th of December 2013 SILVER AMERICA will pay Yale $355,000, issue an additional 200,000 common minimum expenditures of an additional $900,000. shares in the capital of SILVER AMERICA to Yale and have

	Any Expenditures greater than the minimum amount will be credited towards the next year.The common shares issued by SILVER AMERICA will be restricted as per the minimum requirements set by the appropriate regulatory body.If drilling has not started by die ln of June 2011 Yale will give 3 months notice to have a drill program started and if drilling has not started by the lsl of August 2011 the Agreement will be cancelled.

(b)	Upon the execution and exercise of the Option, Yale agrees to transfer a 90% undivided interest in the Property to the Mexican subsidiary of SILVER AMERICA.

	Yale will retain a 2% NSR (a total of 3% for the property) that can be bought out in entirety for US $2,000,000.Yale agrees to maintain all filings and payments on all claims within the Property in accordance with the laws of Mexico until such time as the Property is transferred to SILVER AMERICA- All such costs are to be reimbursed by SILVER AMERICA.

(c)	Until the execution and exercise of the Option, the parties agree to the following:

	(i)	Yale will be the operator of the Property and will charge a standard 15% management fee on all Expenditures incurred on the Property;

	(ii)	On an ongoing basis, Yale will budget for die project for each phase and receive 50% before starting each phase. The allocation of (he funds will be determined by mutual consent of both parties.

	(iii)	That SILVER AMERICA will fund a minimum of $15,000 of exploration work (not just Expenditures) every quarter (e.g. Apr/May/Jun,).

	(iv)	Yale will deliver to SILVER AMERICA a detailed account of work expenditures upon request, but not more often than every three (3) months;

	(v)	Regardless of the amount of expenditures that have been committed, SILVER AMERICA will be responsible for paying the property taxes that are due bi-annualty.

2. Due Diligence Investigation	Yale agrees to make available and grant access to SILVER AMERICA and their representatives, any corporate, financial, geological or other information as is reasonably necessary to conduct a due diligence review of the Property- Yale shall take reasonable good faith efforts promptly to provide SILVER AMERICA or its representatives such documents as may reasonably be requested in writing. Yale will grant to SILVER AMERICA and ils consultants the right of entry to the Properly for the purpose of carrying out its due diligence review of the Property and to perform such investigations, surveys and tests as SILVER AMERICA deems desirable. The Closing of the Definitive Agreement is subject to SILVER AMERICA's satisfactory due diligence review of the Property.

3. Budgets and payments	While Yale is Operator, Yale will provide SILVER AMERICA a budget for each successive phase of exploration and SILVER AMERICA agrees to:

	(a)	approve and/or provide comments on the budget within fourteen (14) days;

	(b)	give to Yale an advance of at least 50% of each budget within 30 days of its approval and that Yale will not start that next phase of exploration until the advance has been received;

	Payment to Yale for each completed phase of exploration will be due within thirry (30) days of receipt of request from Yale and will be accompanied by a detailed breakdown of cosls.

	If the complete funds are not received within thirty (30) days, Yale will have (he right to issue a letter of default for the amount owed and that if the funds have not been received within an additional thirty (30) days, Yale will have the right to terminate the Option. For greater clarity, if expenditures have not been refunded/paid to Yale within sixty (60) days from the date of the original request the agreement will be terminated.

4. Closing Conditions	Conditions to Closing shall include, without limitation:

	(i)	receipt of any necessary regulatory approvals;

	(ii)	SILVER AMERICA completing a due diligence review of the Property and SILVER AMERICA being satisfied, in its sole and absolute discretion, with the results of such a review and verification;

		The parties agree to close the Definitive Agreement within sixty (60) days after the execution of this Letter of Intent and agree to extend the closing date for an additional thirty (30) days if there is a delay.

5. Disclosure	The parties are permitted to make any public announcement regarding this Letter of Intent or any transaction contemplated hereby as required by applicable securities law.

6. No-Shop and Exclusive Provisions	Until sixty (60) days after the date of this Letter of Intent and in consideration for SILVER AMERICA's commitment of time and resources to perform due diligence, Yale will not, directly or indirectly, through any officer, director, employee, affiliate or agent or otherwise, take any action to solicit, initiate, seek, encourage or support any inquiry, proposal or offen from, furnish any information to, or participate in any negotiations with, any third party regarding the sale of the Property, or any plans to develop the Property. Yale agrees that my such negotiations (other than negotiations with SILVER AMERICA) in progress as of the date of this letter will be suspended during such period, and that Yale will not accept or enter into any agreement, arrangement or understanding for sale or option of the Properly or for the development of the Property during such period.

	If Yale or any of its officers, directors, employees, affiliates or agents receives any proposal for, or inquiry respecting, any third party acquisition of or development for the Property, Yale will promptly notify SILVER AMERICA, describing in detail the identity of the person making such proposal or inquiry and the terms and conditions of such proposal or inquiry.

7. (a) Expenses	Otherwise stated herein. Yale and SILVER AMERICA shall each be liable for their own costs, including legal, accounting, and other such costs. incurred by each of them in the negotiation and closing of this transaction. SILVER AMERICA shall be responsible for all costs relating to its due diligence review of the Property.

(b) Break-up Fee	If within thirty (30) days from the date of this Letter of Intent or anytime prior to the Closing of the Definitive Agreement, Yale fails to complete the terms outlined within this Letter of Intent, Yale will reimburse to SILVER AMERICA ail the expenses that have been incurred including the legal fees, due diligence expenses, taxes and disbursements incurred by SILVER AMERICA in relation to the review of the Property and drafting of the Definitive Agreement (and Joint Venture Agreement) and such reimbursement costs will not exceed $25,000.

8. Area of Interest	There will be no Area of Interest surrounding the Property.

	If Yale were to acquire a property or properties adjoining the Property, such property(ies) would be offered to SILVER AMERICA on a first right of refusal basis under terms similar to those within the Definitive Agreement.

This Letter of Intent represents only the current thinking of the parties relating to the proposed transaction. All rights and obligations of the parties will be subject to negotiation and execution of a definitive agreement among the parties, completion of the due diligence, other matters set forth above, and the approval, if required, of the appropriate regulatory bodies.

Concession name	Title number	Approx. Area (ha)

XXXXXXXXX	233872	127.4100
XXXXXXXXX 2	233873	155.4200
	Total:	282.83