Raven Gold Corp.
May
30,
2006
Xx.
Xxxxxxx X. Xxxxxx Xx.
President
& CEO
Xxxx
Xxxx
Resources Corp.
Re:
Joint
Venture Agreement on the La Currita Groupings, near Temoris, Chihuahua, Mexico
between Amermin S.A. de C.V., a 97% owned subsidiary of Xxxx Xxxx Resources
Corp. (Xxxx) and Raven Gold Corp. (RAVEN) in trust for a Mexican subsidiary
to
be created at a later date. The La Currita Groupings are approximately 192
acres
and are known as Xxxxxx 0, Xx Xxxxxxx, Xx Curra, and La Currita (Head of
group).
Dear
Xx.
Xxxxxx;
We
are
pleased to present the following terms regarding the La Currita
Groupings.
Terms:
|
1.
|
Upon
the signing of this Agreement, RAVEN agrees to purchase 25% of Tara’s
interests in the La Currita Groupings by completing the
following;
|
|
a)
|
Make
a non-refundable payment of US$75,000.00, coinciding with the signing
of
this Agreement (the payment will be refundable if a satisfactory
title
search is not secured by RAVEN from Xxxx by August 17,
2006);
|
|
b)
|
Make
a payment of US$125,000.00 by August 17,
2006;
|
|
c)
|
Make
a payment of US$150,000.00 by October 17,
2006;
|
|
d)
|
Make
a payment of US$300,000.00 by December 17, 2006;
and
|
|
e)
|
RAVEN
must issue to Xxxx 250,000 Rule 144 restricted common
shares.
|
Upon
signing of this Agreement, Xxxx agrees to:
|
a)
|
Make
available a certified copy of title for the La Currita Groupings
as soon
as one is received or no later then August 17,
2006.
|
|
2.
|
RAVEN
agrees to make all property payments and any other payments deemed
necessary to maintain the properties and keep in good standing the
full
interest in the La Currita Groupings and continue to make these payments
as long as the Joint Venture outlined in this agreement is in effect.
Payments will be escrowed for payment at least 14 days before payment
is
due.
|
|
3.
|
RAVEN
will make an additional payment of US $100,000.00 on every anniversary
date of this agreement to maintain its interests earned, and to keep
the
Joint Venture in good standing.
|
1
|
4.
|
On
a monthly basis, the net operating revenue derived from La Currita
will be
distributed at the interest level earned, according to the overall
terms
of this agreement, by each party on the last day of the month during
which
the revenue was generated.
|
|
5.
|
Raven
will have the right to invest up to a maximum of $500,000.00 Start-Up
Capital, which is unrelated to any payments or expenditures within
this
agreement, under special terms. Whereby the investment will be paid
back
out of net operating revenue at a rate higher then the current interest
earned. On a monthly basis, 60% of the net operating revenue derived
from
La Currita, will be set aside and credited or paid out to Raven towards
recovery of the Start-Up Capital investment by Raven. The remainder
of the
net operating revenue derived from La Currita, during the recovery
of the
Start-Up Capital phase, will be distributed to Xxxx. Once the full
amount
of the Start-Up Capital has been recovered from the 60% set aside,
the
revenue sharing will revert back to the interest that has been earned
according to the overall terms of this
agreement.
|
|
6.
|
RAVEN
may increase its interest in the La Currita project to 40% thereby
reducing Tara’s interest in the La Currita Groupings to 60%, after first
notifying Xxxx of RAVEN’s intentions and after the following conditions
have been met:
|
|
a.
|
RAVEN
spends an additional US$1.0 million, over and above the Start-Up
Capital,
on exploration and development within 18 months of the date this
agreement
is signed. Xxxx agrees that RAVEN will be the operator overseeing
the
additional US$1.0 million expenditure; however, Xxxx may have it
representatives on location at any and all times to observe all
operations, and may audit expenditures as
necessary;
|
|
b.
|
RAVEN
will supply the expertise and expenditures, within the amount outlined
in
6)a., necessary to achieve monthly production at the La Currita Processing
Plant of 4,500 tons per month for 3 consecutive months and maintain
ongoing production of a minimum of 4,000 tons per
month;
|
|
c.
|
Once
RAVEN has notified Xxxx in writing, along with supporting documents,
that
it has spent US$1.0 million in exploration work on La Currita, the
Joint
Venture Partners agree to enter into a standard joint venture agreement
by
which it will have a 40% working interest in the La Currita Groupings
and
Xxxx will own a 60% interest. At this point, RAVEN is to be appointed
operator of the joint venture and will remain the operator as long
as it
maintains it’s 40% participation in the joint venture by paying all
property payments and it’s proportionate share of expenses or decides to
withdraw from such responsibility;
and
|
|
d.
|
RAVEN
issues to Xxxx an additional 250,000 Rule 144 restricted common shares
at
notification to increase its
interest.
|
|
7.
|
A
standard dilution clause will apply in case one of the partners decides
not to participate financially for its proportionate share in any
exploration or development program submitted by the operator. Should
the
operator decide not to present any exploration or development programs,
the other party can present one and become the
operator.
|
2
|
As
a basis for the dilution clause, each party will be deemed to have
invested the following amount of money in the La Currita
Groupings:
|
|
1.
|
RAVEN:
US$1,600,000 (representing its 40% interest);
and
|
|
2.
|
Xxxx:
US$2,400,000 (representing its 60%
interest).
|
Once
a
participant has been diluted to a 10% interest, this interest will automatically
convert into a 3% N.S.R. and the joint venture agreement will become null and
void. For a period of no longer then 1 year, the majority party will have the
option to reduce the 3% NSR to 1% in exchange for a US$2,000,000
payment;
|
8.
|
Each
party, as long as their original participation is maintained, will
have
one vote each in the decisions of the joint venture management committee.
An arbitration clause will be included in case of
disagreement;
|
|
9.
|
It
is also agreed that RAVEN has an option to increase its interest
in the La
Currita Groupings to 60% thereby reducing Tara’s interest in the La
Currita Groupings to 40%, on the following
conditions:
|
|
a.
|
RAVEN
spends an additional US$2.5 million over and above the US$1.0 million
expenditures outlined in 6(a) above on exploration and development
within
36 months of the date this agreement is signed. Xxxx agrees that
RAVEN
will remain as operator overseeing the US$2.5 million expenditure;
however, Xxxx may have it representatives on location at any and
all times
to observe all operations, and may audit expenditures by RAVEN as
necessary;
|
|
b.
|
RAVEN
will supply the expertise and expenditures, within the amount outlined
in
9)a., necessary to achieve monthly production at the La Currita Processing
Plant of 9,000 tons per month for 3 consecutive months and maintain
ongoing production of a minimum of 8,000 tons per
month;
|
|
c.
|
RAVEN
issues to Xxxx 250,000 Rule 144 restricted common shares at notification
to increase its interest; and
|
|
d.
|
RAVEN
agrees that after it has earned its 60%, Xxxx will receive 90 days,
from
the date of approval of any exploration budget, to pay its proportionate
share of actual expenditures.
|
|
The
dilution clause outlined in 7 above, will be revised upon RAVEN increasing
its interests to 60%, and as a basis for the dilution clause, each
party
will be deemed to have invested the following amount of money in
the La
Currita Groupings;
|
| 1 |
RAVEN:
US$4,100,000 (representing its 60% interest);
and
|
| 2 |
Xxxx:
US$2,733,333 (representing its 40%
interest).
|
3
|
10.
|
RAVEN
agrees that it will divide any economic benefits gained through this
agreement based in the earned interest at the time of
benefit.
|
|
11.
|
It
is understood that Xxxx has an agreement with Paramount Gold Mining
Corp,
which hit holds under the “San Xxxxxx Joint Venture Agreement” dated
August 3rd, 2005 to supply and process ore at the La Currita Mill
at a
minimum rate of 75 tons per day and its first right of refusal to
participate in any mill improvement that will increase the daily
capacity
of the La Currita mill operation, therefore increasing RAVEN’s minimum
rate (75 tpd) proportionally.
|
|
12.
|
Should
RAVEN decide not to pursue exploration efforts, then RAVEN will cease
to
be the operator. In such a case, RAVEN will continue to hold its
earned
interest in the La Currita Groupings and all portions of this agreement
shall remain in effect and binding on each party, but may be diluted
out
as outlined clause 7 above.
|
|
13.
|
Subject
to any disclosure requirements as promulgated by the Securities and
Exchange Commission, the parties agree to consult each other and
agree on
joint news releases in the event of any public disclosure. Furthermore,
all news releases shall be jointly reviewed and released with the
following format included at the beginning of each news release:
“CHICAGO,
“Appropriate Date” (MARKETWIRE) - (Other OTC: XXXX.XX) Xxxx Xxxx Resources
Corp. and Raven Gold Corp (“XXXX.XX”) Raven Resources is pleased to
announce... This text may be revised by Xxxx at any
time.
|
|
14.
|
Either
party in the joint venture shall have first right of refusal on the
sale
of any portion of its interest in the La Currita Groupings to a third
party for 30 days from the date of
notification.
|
Subject
to any disclosure requirements as promulgated by the Securities and Exchange
Commission, the parties agree to consult each other and agree on joint news
releases in the event of any public disclosure.
The
parties mutually understand that, subject to the conditions contained herein,
this letter constitutes a binding agreement.
Please
indicate your concurrence with the foregoing by affixing your signature below,
and thereafter transmitting such executed copy in the manner heretofore
described.
DATED
this May 30, 2006
Per: /s/
Xxxx Xxxxxxxxx
President
00000-00xx
Xxxxxx
Xxxxxxx,
X.X. Xxxxxx
X0X
0X0
| DATED this May 30, 2006 | DATED this May 30, 2006 |
|
Per: /s/ Xxxxxxx X. Xxxxxx Xx.
|
Per: /s/
|
|
President & CEO
Xxxx Xxxx Resources Corp.
|
President
Amermin S.A. De
C.V
|
.
4
La
Currita Property Payment Schedule
|
Date
of Payment
|
Payment
Amount (U.S.$)
|
|||
|
June
25, 2006
|
$
|
50,000
|
Paid | |
|
July
25, 2006
|
$
|
50,000
|
Paid | |
|
August
25, 2006
|
$
|
50,000
|
||
|
September
25, 2006
|
$
|
50,000
|
||
|
October
25, 2006
|
$
|
50,000
|
||
|
November
25, 2006
|
$
|
50,000
|
||
|
December
25, 2006
|
$
|
50,000
|
||
|
January
25, 2007
|
$
|
50,000
|
||
|
February
25, 2007
|
$
|
50,000
|
||
|
March
25, 2007
|
$
|
50,000
|
||
|
April
25, 2007
|
$
|
50,000
|
||
|
May
25, 2007
|
$
|
25,000
|
||
|
Taxes
Due on final payment
|
$
|
180,000
|
||
|
Total
Property Payments
|
$
|
575,000.00
|
||
5
