Agreement of Purchase and Sale
Date:
June
1,
2007 (“Effective Date”)
Seller: X.
X.
Xxxxxx
Address:
Buyer: Aultra
Gold, Inc., a Nevada corporation, X.X.
Xxx
0000, Xxxxxxxxxxxx, Xx. 00000
Agreement
Section
1. Sale
of
Property.
Seller
agrees to sell to Buyer and Buyer agrees to buy from Seller for the
consideration and on the terms and conditions set forth below the following
described mining claims located in Humboldt County, State of Nevada, mapped
out
on Appendix I and described in Appendix II attached hereto, together with all
improvements and all equipment owned by Seller located thereon (the
Property).
Section
2. Consideration.
The
consideration for the purchase and sale of the Property shall be payable as
follows:
2.1 Reimbursement.
As part
of the consideration Buyer has reimbursed Seller for all staking and filing
costs related to the Property, receipt and sufficiency of which are hereby
acknowledged by Buyer.
2.2 Transfer
of Stock Upon Closing. Upon
closing of this Agreement Buyer shall transfer to Seller Fifty Thousand (50,000)
shares of stock in Buyer with a value agreed upon by the parties as Zero and
50/100 Dollars ($0.50) per share.
2.3 Transfer
of Stock Upon Further Determination. Upon
Buyer’s sole determination of sufficient mineralization to place the Property in
production, Buyer shall transfer to Seller Fifty Thousand (50,000) shares of
stock in Buyer; such determination shall be made not later than thirty (30)
days
following the acquisition of the last item of data for further evaluation as
provided in paragraph 3.3 hereof.
2.4 Transfer
of Stock Upon Commencement of Production. Not
later
than 10 days following the date the Property is placed into development for
production of metals, Buyer shall transfer to Seller One Hundred Thousand
(100,000) shares of stock in Buyer.
2.5 Net
Smelter Royalty.
As
further consideration after the Property is placed in production,
Buyer
shall direct to Seller a monthly Net Smelter Royalty of Two and 00/100 Per
Cent
(2.00%) upon all gold, silver, copper, or other metals (the metals) produced
and
sold from the Property. Each royalty payment shall be paid not later than thirty
(30) days following the last day of the month in which the metals were produced
and sold.
Section
3. Exploration
and Evaluation; Right to Mine; Right to Enter; Hold Harmless
Provision.
3.1 Exploration
and Evaluation.
Commencing on the Effective Date and prior to closing, Seller hereby grants
to
Buyer an unrestricted and absolute right of ingress and egress in and to the
Property, and to have possession of the mining claims, for the purpose of
Buyer’s exploring and evaluating the mining claims situated on the Property,
including the incidental mining of ore in amounts commensurate with such
exploration and evaluation; Buyer shall timely provide Seller with any and
all
information generated by Buyer’s work as it becomes available.
3.2 Right
to
Enter.
Seller
shall have the right to enter on the Property at any reasonable time for the
purpose of inspection of, among other things, possible soil and water
contamination and metals production records, the foregoing not being an
exclusive list, during the term of this Agreement of Purchase and Sale and
prior
to closing.
3.3 Further
Evaluation. Following
closing, Buyer shall further explore and evaluate the mining claims situated
on
the Property, including the incidental mining of ore in amounts commensurate
with such exploration and evaluation; Buyer shall timely provide Seller with
any
and all information generated by this work commitment as it becomes
available.
3.4 Hold
Harmless Provision.
Buyer
shall protect, defend, and hold Seller harmless from any loss, liability, or
damage to persons or property arising out of or related to Buyer’s activities on
the Property or any condition of the Property during the terms of this Agreement
of Purchase and Sale and prior to closing. If prior to closing Buyer defaults
on
this Agreement of Purchase and Sale and this Agreement is terminated, Buyer
shall quitclaim title to the property to Seller free of any lien, encumbrance,
or charge on it attributable to Buyer’s activities.
Section
4. Conveyance.
Upon
closing, Seller
will deliver to Buyer a mining claim Quitclaim Deed, transferring all its right,
title, and interest in and to the Property to Buyer.
Section
5. Operator.
The
operator of the mine shall be Aultra Gold, Inc., or such other operator as
Aultra may specify from time to time.
Section
6. Liability
Insurance.
Buyer
shall maintain public liability and property damage insurance in a responsible
company with limits of not less than $1,000,000.00 per occurrence. Such
insurance shall cover all risks arising directly or indirectly out of Buyer’s
activities on or any condition of the Property whether not related to the
occurrence caused or contributed to by Buyer’s negligence. Such policy shall be
placed in force immediately on commencement of any work on the claims and shall
continue in force throughout the term of this Agreement. The Insurance shall
protect Seller and Buyer against claims of third parties.
Section
7.
Buyer’s
Further Responsibilities with Regard to the Property.
Prior
to
closing:
7.1 Workmanlike
Manner. All
work
done on the Property by Buyer shall be done in a workmanlike manner, following
good mining practices, and at Buyer’s sole cost and expense.
7.2 Waste.
During
the term of this Agreement, Buyer shall not commit or suffer any waste of the
Property or any improvements thereon.
7.3 Comply
with Laws.
During
the term of this Agreement, Buyer shall comply with all laws, ordinances,
regulations, directions, rules, and requirements of all governmental
authorities.
7.4 Fees;
Taxes; Permits and Licenses. Buyer
shall pay when payable all fees, property taxes and shall maintain in full
force
and effect all necessary permits and licenses.
Section
8. Assignment.
Buyer
shall retain the right to assign or sell the Property; however, such assignment,
sale, or transfer shall not relieve Buyer from its obligations under this
Agreement.
Section
9. Closing.
9.1 Time
and
Place.
Closing
of the sale and purchase of the Property (the “Closing”) shall occur not later
than ____________________ (the
“Closing Date”). Closing of this agreement shall be deemed complete when both
parties have performed their mutual obligations under paragraph 2.2 and Section
4 hereof.
9.2. Buyer
and
Seller shall
bring to closing the following:
a. The
conveyance documents described in paragraph 2.2 and Section 4
hereof;
b. A
duly
executed affidavit certifying that Seller is not a foreign person, trust,
partnership, or corporation in compliance with the requirements of IRC §1445;
c. Such
other
documents and funds, as are required to close the sale and purchase of the
Property in accordance with this Agreement.
9.3 Costs.
Buyer
shall pay the fee for recording the conveyance documents referred to
herein.
Section
10. Area
of
Mutual Interest.
The
parties hereby declare an Area of Mutual Interest (“AMI”) to exist within the
area the boundaries of which are described by a line that is one-half (1/2)
mile
from the nearest point of the boundary of the claims as mapped and described
herein. In the event Buyer produces metals
from any claim within the AMI, Buyer shall pay the Net Smelter Royalty described
in paragraph 2.5 on such metals as provided therein.
Section
11. Notice
of
Abandonment of Claims.
In
the
event Buyer desires to abandon the claims that are the subject of this Agreement
(including claims within the AMI), Buyer shall give written notice to Seller
of
Buyer’s intention abandon the claims not less than ninety (90) days before the
date of abandonment. Buyer shall maintain the claims following notice to and
including the date of abandonment.
Section
12. Waiver.
Failure
by Seller or Buyer to enforce any right under this Agreement shall not be deemed
to be a waiver of that right or of any other right, nor shall any waiver by
Seller of any breach hereof be held to be a waiver of any succeeding breach,
or
a waiver of this non-waiver clause.
Section
13. Successors
and Assigns.
Rights,
terms, covenants, and conditions herein contained shall be binding on and inure
to the benefit of the heirs, successors, and assigns of Seller and
Buyer.
Section
14. Notices.
All
notices required or permitted to be given shall be in writing and shall be
deemed given and received on personal service or deposit in the United States
Mail, certified or registered mail, postage prepaid, return receipt requested,
addressed to the addresses stated above. The foregoing addresses may be changed
by written notice, given in the same manner. Notice given in any manner other
than the manner set forth above shall be effective when received by the party
for whom it is intended.
Section
15. Representation
and Condition of Property.
Buyer
certifies that this Agreement of Purchase and Sale is accepted and executed
on
the basis of Buyer’s own examination and personal knowledge of the Property, and
Buyer’s opinion of the value thereof. No representation as to the quality or
quantity of the mining claims or any other fact relating to the mining claims
shall be deemed a material representation between the parties hereto unless
the
same shall be included in this Agreement in writing, and all other
representations of whatsoever nature are hereby agreed to be immaterial and
not
actionable by or in favor of either party. Buyer accepts the Property on the
basis of Buyer’s own independent investigation and inspection and not upon any
representations made by Seller.
Section
16. Governing Law; Interpretation.
This
Agreement shall be governed by the laws of Nevada. If a court of competent
jurisdiction holds any portion of this Agreement to be void or unenforceable
as
written, Seller and Buyer intend that (1) that portion of this Agreement be
enforced to the extent permitted by law, and (2) the balance of this Agreement
remain in full force and effect.
Section
17. Time
Is
of the Essence.
Time
is
of the essence of this Agreement.
Section
18. Authority
to Execute.
Each
person executing this Agreement on behalf of Seller and Buyer, respectively,
warrants his or her authority to do so.
Section
19. Integration;
Modification and Amendments.
This
Agreement contains the entire agreement of the parties with respect to the
Property and supersedes all prior written and oral negotiations and agreements
with respect to the Property insofar as the within described mining claims
are
concerned. Any modifications, changes, additions, or deletions to this Agreement
must be approved by Seller and Buyer, in writing.
|
Seller:
|
Buyer:
Autra
Gold, Inc.
|
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| /s/ X. X. Xxxxxx | /s/ Xxxxx X. Xxxxxx | ||
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X. X. Xxxxxx |
Xxxxx X. Xxxxxx, President |
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