LETTER OF INTENT
February
16, 2010
RE: Purchase
of assets from Poltavas Capital Management Ltd
The following sets out the basic terms
upon which Supatcha Resources Inc. would be prepared to purchase the assets of
described herein from Poltavas Capital Management Ltd. The terms are
not comprehensive and additional terms, including reasonable warranties and
representations, will
be incorporated into a formal agreement (the "Formal Agreement") to be
negotiated. The basic terms are as follows:
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1.
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Purchaser: Supatcha
Resources Inc. (the "Purchaser")
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2.
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Vendor:
Poltavas Capital Management Ltd (the
"Vendor")
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3.
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Assets:
The
Purchaser agrees to purchase from the Vendor and the Vendor agrees to
sell, assign and transfer to the Purchaser, certain assets including,
without limiting the foregoing, all assets identified in Exhibit A
attached hereto (collectively the
“Assets”).
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4.
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Purchase Price:
The Vendor will sell to the Purchaser and the Purchaser will buy from the
Vendor the Assets for a purchase price of US $7,500,000 and will issue
500,000 common shares (the "Purchase Price"). The Purchase
Price will be allocated as the Purchaser deems appropriate among the
various items comprising the Assets and the Vendor and the Purchaser agree
to report the sale and purchase of the Assets for all federal and local
tax purposes in accordance with such
allocation.
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5.
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Access to
Information: The parties hereto agree that immediately
upon execution of this Letter of Intent the Purchaser and its respective
advisors will have full access during normal business hours to, or the
Vendor will deliver to the Purchaser, copies of all documents pertaining
to the Assets.
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6.
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Return of
Materials: Each of the parties agrees to return or
destroy any materials delivered in accordance with Section 7 of this
Letter of Intent if the Formal Agreement is not executed within the time
provided.
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7.
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Condition(s) Precedent
for the Purchaser: The obligation of the Purchaser to
purchase the Assets will be subject to satisfaction or written waiver by
the Purchaser of the following condition(s) (the "Conditions Precedent")
within five (5) days after execution and delivery of the Formal
Agreement:
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the
Purchaser and its solicitors having had a reasonable opportunity to
perform the searches and other due diligence reasonable or customary in a
transaction of a similar nature to that contemplated herein and that both
the solicitors and the Purchaser are satisfied with the results of such
due diligence;
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the
Purchaser obtaining the consent from any parties from whom consent to the
transfer of the Assets is
required;
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no
material adverse change having occurred in connection with the Assets
prior to Closing;
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no
legal proceedings pending or threatened to enjoin, restrict or prohibit
the transactions contemplated in this Letter of
Intent;
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a
satisfactory legal opinion being available from Vendor's
counsel;
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satisfactory
review of title to the Assets;
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execution
of the Formal Agreement by the Vendor;
and
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approval
of the Board of Directors of the Vendor being
obtained.
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It would
be the expectation of the Purchaser that many of the Conditions Precedent will
be narrowed or eliminated altogether as the Purchaser completes its due
diligence and the Formal Agreement and schedules thereto are
finalized.
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8.
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Closing: The
closing (the "Closing") of the transactions contemplated by this Letter of
Intent will occur not later than April 17, 2010, or such other date as is
mutually agreed to among the parties hereto. At the Closing,
the Vendor will transfer the Assets to the Purchaser free from any
outstanding liens, charges, claims or encumbrances and execute all such
documents as the Purchaser's solicitors may require in order to affect
such transfer. The Closing may take place by exchange of the
appropriate solicitor's undertakings, which will involve each party's
solicitors delivering to his or her counterpart all required cash and
documentation, to be held in trust and not released until all such cash
and documentation has been executed and delivered to the
Purchaser.
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9.
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Confidentiality: All
negotiations regarding the Vendor and the Assets will be confidential and
will not be disclosed to anyone other than respective advisors and
internal staff of the parties and necessary third parties, such as lenders
approached for financing. No press or other publicity release
will be issued to the general public concerning the proposed transaction
without mutual consent unless required by law, and then only upon prior
written notice to the other party.
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10.
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Purchase and Sale
Agreement: Upon execution of this Letter of Intent by
all parties hereto, the Purchaser will prepare a draft of the Formal
Agreement for the Vendor’s review.
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11.
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Good Faith
Negotiations: Each of the Purchaser and the Vendor will
act honestly, diligently and in good faith in their respective endeavors
to negotiate, settle and execute the Formal Agreement within 90 days
following the execution of this Letter of
Intent.
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12.
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Exclusive
Opportunity: For sixty (60) days following the execution
of this Letter of Intent, the Vendor will not, directly or indirectly,
solicit, initiate, entertain or accept any inquiries or proposals from,
discuss or negotiate with, provide any non-public information to or
consider the merits of any unsolicited inquiries or proposals from any
person or entity to any transaction involving the sale of the business or
assets of the Vendor or any of the securities of the Vendor or any merger,
consolidation, business combination or similar transaction involving the
Vendor. The Vendor agrees to promptly notify the Purchaser if
any of them receives an unsolicited offer for such a
transaction.
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13.
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Not a Binding
Agreement: This Letter of Intent does not create a
binding contract and will not be enforceable, except in respect of the
obligations set out in paragraphs 8, 11, 13, and 14. Only the
Formal Agreement, duly executed and delivered by Vendor and Purchaser,
will be enforceable, and it will supersede the provisions of this Letter
of Intent and all other agreements and understandings between the
Purchaser and the Vendor with respect to the subject matter of this Letter
of Intent.
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14.
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Currency: All
references to "$" in this Letter of Intent shall refer to currency of the
United States of America.
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15.
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Proper
Law: This Letter of Intent will be governed by and
construed in accordance with the law of the State of Nevada and the
parties hereby attorney to the jurisdiction of the Courts of competent
jurisdiction of the State of Nevada in any proceeding
hereunder.
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16.
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Counterparts and
Electronic Means: This Letter of Intent may be executed
in several counterparts, each of which will be deemed to be an original
and all of which will together constitute one and the same
instrument. Delivery to us of an executed copy of this Letter
of Intent by electronic facsimile transmission or other means of
electronic communication capable of producing a printed copy will be
deemed to be execution and delivery to us of this Letter of Intent as of
the date of successful transmission to
us.
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17.
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Acceptance: If
you are agreeable to the foregoing terms, please sign and return a
duplicate copy of this Letter of Intent by no later than by 5:00 p.m. EST
on February 16, 2010. Facsimile is
acceptable.
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Sincerely,
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/s/ Xxxxx Xxxxxx
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Name:
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Xxxxx
Xxxxxx
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Title:
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President
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The
above terms are accepted this 16th
day of February, 2010.
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POLTAVAS
CAPITAL MANAGEMENT LTD.
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/s/ Xxxxxxx Xxxxxxx
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Name:
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Xxxxxxx
Xxxxxxx
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Title:
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President
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3
EXHIBIT
A
ASSETS
Barlevskoye
and Vynohradiv Gold licenses in Southwest Ukraine
4
