LETTER OF INTENT PURCHASE AGREEMENT
LETTER
OF INTENT
This
agreement made as of the 11th
day of
September, 2007 with an effective date as of the 11th
day of
September, 2007.
BETWEEN:
STAR
URANIUM CORP., a body corporate with offices at the City of Saskatoon, in the
Province of Saskatchewan (the Vendor)
OF
THE
FIRST PART
AND:
XXXXX
MINING INC., a body corporate with offices at the City of St. Xxxxxxx, in the
province of Quebec (the Purchaser)
OF
THE
SECOND PART
WHERE
AS:
1.
The
Vendor is the recorded and beneficial holder of a 100% interest in certain
property (the “Property”) situated in the Zama Lake area of northern Alberta,
more particularly described in Schedule “A”; and
2. The
Vendor has agreed to sell to the Purchaser a 100% interest in the Property
on
the terms and conditions set forth in this agreement.
NOW
THEREFORE, for good and valuable consideration (the receipt and sufficiency
of
which is acknowledged), the Vendor and the Purchaser agree as provided in this
agreement:
THE
SALE
Vendor’s
representation and warranties
The
Vendor represents and warrants to Xxxxx Mining, Inc. that:
| a) |
It
is beneficial and registered or recorded owner of a 100% interest in
the
Property;
|
| b) |
The
Property is in good standing, free and clear of all
encumbrances;
|
| c) |
The
Vendor has the full and undisputed right to deal with the Property
as
provided for in this Agreement;
|
| d) |
The
Vendor is not a non-resident for purposes of Section 116 of the Income
Tax
Act (Canada).
|
TERMS:
1.
The
Purchaser shall pay to the Vendor the sum of $100,000, payable on or before
October 31, 2007.
2. The
Purchaser shall deliver to the Vendor 150,000 shares of stock in Xxxxx Mining,
Inc. at a deemed price of $0.50 (U.S.) per share upon approval by the regulatory
authorities.
3. The
Purchaser, on or before May 16, 2008 shall spend or cause to be spent $400,000
in eligible exploration expenditures in order to maintain the Property in good
standing. In the event that it becomes apparent that some of the Property should
be allowed to lapse based on geological evaluation, that part of the Property
will be offered back to the Vendor first, with a 60 day period for the Vendor
to
re-acquire the land from the Purchaser or to allow it to lapse.
4. In
order
to maintain all of the Property, after May 16, 2008 and before May 16, 2010,
exploration expenditures of a further $ 1,000,000 are required to be spent
by
the Purchaser. However, if it is mutually agreed to allow certain parts of
the
Property to lapse, then the amount of expenditure required will be adjusted
accordingly.
5. The
Vendor shall retain a 2% Net Smelter Royalty in the Property. The Purchaser
can
buy down the NSR to 1% by making a payment of $1,000,000 to the Vendor at any
time
6. The
Vendor shall retain the diamond rights on the Property.
7. This
Letter of Agreement may be replaced by a more formal agreement if deemed to
be
necessary.
| /s/ Xxxx Xxxxxx | /s/ Xxxxx Xxxxx |
|
Xxxx Xxxxxx
President of Star Uranium
|
Xxxxx Xxxxx
President of Xxxxx Mining,
Inc.
|
2
“Schedule
A”
|
Permit
#
|
Legal
Description
|
Date
of Issue
|
Area
(Hectares)
|
1st
Term Work Requirement
|
|
9306050838
|
6-06-116:
1-36
|
16-May-2006
|
9,216
|
$46,080
|
|
9306050891
|
6-03-117:
1-36
|
19-May-2006
|
9,216
|
$46,080
|
|
9306050892
|
6-04-117:
1-36
|
19-May-2006
|
9,216
|
$46,080
|
|
9306050893
|
6-05-117:
1-36
|
19-May-2006
|
9,216
|
$46,080
|
|
0000000000
|
6-06-117:
1-36
|
19-May-2006
|
9,216
|
$46,080
|
|
9306050897
|
6-07-117:
1-36
|
19-May-2006
|
9,216
|
$46,080
|
|
9306050898
|
6-03-118:
1-36
|
19-May-2006
|
9,216
|
$46,080
|
|
9306050899
|
6-04-118:
1-36
|
19-May-2006
|
9,216
|
$46,080
|
|
9306050900
|
6-05-118:
1-36
|
19-May-2006
|
9,216
|
$46,080
|
|
9306050901
|
6-06-118:
1-36
|
19-May-2006
|
9,216
|
$46,080
|
|
Total=
|
92,160
|
$460,800
|
