AGREEMENT OF PURCHASE AND SALE
THIS AGREEMENT is made effective as of the 25th day of June, 2002.
BETWEEN:
XXXXX XXXXXX, prospector, of X.X. Xxx 000 Xxxxxxxx, Xxxxxxx
Xxxxxxxx, X0X 0XX
("Xxxxxx")
AND:
XXXX MIRKO, prospector, of 000 Xxxxxxx Xxxxxx, Xxxxx
Xxxxxxxxx, Xxxxxxx Xxxxxxxx, X0X 0X0
("Mirko")
AND:
RIMFIRE MINERALS CORPORATION, a company incorporated
under the laws of the Province of British Columbia and having its
registered and records office at 700 - 000 Xxxx Xxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxx Xxxxxxxx,X0X 0X0
("Rimfire")
WHEREAS:
X. Xxxxxx and Mirko are the beneficial owners of a 100% interest in and to
the Xxxx property, located in the Liard Mining Division of British
Columbia and more particularly described in Schedule "A" attached to this
Agreement (the "Property"), with each of Xxxxxx and Mirko owning a 50%
interest in the Property;
B. Pursuant to a property option agreement dated May 17, 2001 among Xxxxxx,
Xxxxx and Rimfire, (the "Option Agreement"), Xxxxxx and Mirko granted
Rimfire an option to acquire a 100% interest in and to the Property; and
C. Mirko wishes to sell to Rimfire and Rimfire wishes to purchase from Mirko
his 50% interest in the Property (the "Mirko Interest"), and the parties
hereto wish to enter into this agreement for the purpose of setting out
their agreement respecting said purchase and sale.
NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of the sum of
$1.00 and the premises and the mutual covenants, representations and warranties
given by each of the parties to the other, the receipt and sufficiency of which
is hereby expressly acknowledged, the parties do hereby agree as follows:
Purchase and Sale Terms
1. Subject to the terms contained herein, Rimfire agrees to purchase and pay
for and Mirko agrees to sell to Rimfire the Mirko Interest for the
Purchase Price (as hereinafter defined).
2. As consideration for the sale of the Mirko Interest to Rimfire, Rimfire
shall issue 75,000 of its common shares (the "Purchase Price") to Mirko.
3. Rimfire shall pay the Purchase Price to Mirko within 10 days of the date
of TSX Venture Exchange acceptance of this Agreement of Purchase and Sale.
4. Mirko shall be liable for and shall pay all taxes, registration charges and
transfer fees properly payable on and in connection with the sale and
transfer of the Mirko Interest to Rimfire as contemplated hereby.
5. Mirko acknowledges and agrees that the Mirko Interest includes his share
of the Net Smelter Return (as that term is defined in the Option
Agreement) and that his share of the Net Smelter Return will be
transferred to Rimfire upon completion of the sale and transfer of the
Mirko Interest as contemplated hereby.
6. Xxxxxx acknowledges that as a result of the completion of the sale and
transfer of the Mirko Interest as contemplated hereby, Rimfire will own a
50% interest in and to the Property and:
a) Rimfire will be entitled to forego making that portion (being 50%) of the
cash and share payments (including the Advance Royalty Payment as
defined in the Option Agreement) which would otherwise have been
payable to Mirko under the Option Agreement; and
b) Rimfire will only be required to make 50% of the payment described in
section 6.6 of the Option Agreement in order to purchase the Net Smelter
Return (as defined in the Option Agreement) in accordance with the terms
of the Option Agreement, it being understood that all of such payment as
is required to be made by Rimfire pursuant to section 6.6 of the Option
Agreement will be made to Xxxxxx.
7. Mirko acknowledges that the shares to be issued to him pursuant to this
Agreement (the "Purchase Shares") will be issued pursuant to exemptions
from the prospectus and registration requirements of the British Columbia
Securities Act and as a result will be subject to transfer restrictions
imposed by applicable securities legislation, including Multilateral
Instrument 45-103 as adopted by the British Columbia Securities
Commission and the policies of the TSX Venture Exchange.
8. Rimfire covenants to use commercially reasonable efforts to obtain TSX
Venture Exchange acceptance of this Agreement within 30 days after the
date hereof.
9. Upon the completion of the sale and transfer of the Mirko Interest to
Rimfire, Rimfire agrees to be bound by those terms and conditions of the
Option Agreement which were applicable to Mirko prior to the sale and
transfer of the Mirko Interest to Rimfire pursuant to this Agreement.
10. Mirko agrees that after the execution of this Agreement any consent
required to be obtained from Mirko pursuant to section 9.5 of the Option
Agreement may be granted by Rimfire.
Representations and Warranties
11. Rimfire represents and warrants to Mirko that:
a) it is a company duly incorporated and validly subsisting and is in good
standing under the laws of the jurisdiction of its incorporation;
b) it has full power and absolute authority and capacity to enter into
this Agreement and to carry out the transactions contemplated hereby
except where regulatory approval is required; and
c) it has duly obtained all corporate authorizations for the execution,
delivery and performance of this Agreement and such execution, delivery
and performance and the consummation of the transactions herein
contemplated will not conflict with, or accelerate the performance
required by or result in any breach of any covenants or agreements
contained in or constitute a default under, or result in the creation
of any encumbrance, lien or charge under the provisions of its
constating documents or any shareholders' or directors' resolution,
indenture, agreement or other instrument whatsoever to which it is a
party or by which it is bound or to which it may be subject and will
not contravene any applicable law.
12. Mirko represents and warrants to Rimfire that:
a) To the best of his knowledge, other than the interest of Xxxxxx, the
interest of Rimfire pursuant to the Option Agreement and the net
smelter return in favour of Xxxxxx pursuant to the Option Agreement,
the Property is not subject to any liens, charges, royalties or
encumbrances of any kind and is not subject to any right, claim or
interest of any other person;
b) to the best of his knowledge, the Property is in good standing under
the laws of British Columbia and all payments and filings required to
be made and filed in connection with the Property have been made and
filed;
c) he has complied with all of the laws in effect in the jurisdiction in
which the Property is located with respect to the Property;
d) to the best of his knowledge, except as disclosed in this Agreement
and the Option Agreement, there is no adverse claim or challenge
against or to the ownership of or title to the Property or any portion
thereof, nor is there any basis therefor, and there are no outstanding
agreements or options to acquire or purchase the Property or any
portion thereof or interest therein; and
e) to the best of his knowledge, except as provided for in the Option
Agreement, no person or entity has any royalty or other interest
whatsoever in production or profits from the Property or any portion
thereof .
13. The representations and warranties hereinbefore set out are conditions on
which the parties have relied in entering into this Agreement, are to be
construed as both conditions and warranties and shall, regardless of any
investigation which may have been made by or on behalf of any party as
to the accuracy of such representations and warranties, survive the
closing of the transactions contemplated hereby and the acquisition of
any interest in the Property hereunder and each of the parties will
indemnify and save the other harmless from all loss, damage, costs,
actions and suits arising out of or in connection with any breach of any
representation or warranty contained in this Agreement.
Condition Precedent
14. This Agreement is subject to the acceptance of the TSX Venture Exchange
being obtained for the transactions contemplated hereby within 90 days of
the date of this Agreement.
General
15. This Agreement shall be governed by and interpreted in accordance with
the laws of British Columbia.
16. This Agreement embodies the entire agreement and understanding among
the parties hereto and supersedes all prior agreements and undertakings,
whether oral or written, relative to the subject matter hereof
17. Time shall be of the essence of this Agreement.
18. This Agreement shall enure to the benefit of and be binding upon the
parties hereto and their respective successors, permitted assigns, heirs,
administrators and legal representatives.
19. If any one or more of the provisions contained herein should be held to be
invalid, unenforceable or illegal in any respect in any jurisdiction, the
validity, legality and enforceability of such provision shall not in any
way be affected or impaired thereby in any other jurisdiction and the
validity, legality and enforceability of the remaining provisions
contained herein shall not in any way be affected or impaired thereby.
20. This Agreement may be executed in counterparts which may be delivered
by facsimile. Each executed counterpart shall be deemed to be an original
and all such counterparts when read together constitute one and the same
instrument.
IN WITNESS WHEREOF the parties hereto have executed this Agreement on the
date first above written.
RIMFIRE MINERALS CORPORATION
Per: XXXXX X. XXXXXX
Authorized Signatory
WITNESS
XXXXX XXXXXX XXXXX XXXXXX
Witness Signature Xxxxx Xxxxxx
Xxx 00 Xxxxxxxx, XX
Address
Expediter
Occupation
XXXXX XXXXXX XXXX MIRKO
Witness Signature Xxxx Mirko
Box 92 Xxxxxxxx, XX
Address
Expediter
Occupation
This agreement was prepared by Xxxxxx & Company, Barristers & Solicitors, for
Rimfire Mineral Corporation. It is recommended that other parties hereto
obtain independent legal advice with respect to the provisions contained
herein.
PROPERTY OPTION AGREEMENT
THIS AGREEMENT is made effective as of the 28th day of October, 2002.
BETWEEN:
RIMFIRE MINERALS CORPORATION, a company incorporated under
the laws of the Province of British Columbia and having its office at 700 -
000 Xxxx Xxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxx Xxxxxxxx,X0X 0X0
(hereinafter referred to as "Optionor")
OF THE FIRST PART
AND:
PLUTONIC CAPITAL CORP., a company incorporated under the laws of
British Columbia and having its head office at #501 - 000 Xxxx Xxxxxxxx
Xxxxxx, Xxxxxxxxx, Xxxxxxx Xxxxxxxx, X0X 0X0
(hereinafter referred to as "Optionee")
OF THE SECOND PART
WHEREAS:
A. The Optionor has represented to the Optionee that it is the owner of a
100% interest in certain mineral claims located in the Province of British
Columbia more particularly described in Schedule A attached hereto (the
"Property"), subject to a 1.5% net smelter royalty and first right of
refusal to Newmont Canada Limited granted pursuant to a property transfer
agreement dated July 10, 2001 (the "Right of First Refusal");
B. The Optionor has agreed to grant to the Optionee the right and option, but
not the obligation, to earn a 51% participating interest in and to the
Property on the terms and conditions stated in this Agreement and subject
to the terms and conditions of the Right of First Refusal;
C. The Optionee is a capital pool company, as that term is defined in the
policies of the TSX Venture Exchange (the "Exchange") and the option shall
serve as the Optionee's Qualifying Transaction pursuant to the policies of
the Exchange.
NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of the premises
and the mutual covenants, representations and warranties given by each of the
parties to the other, the receipt and sufficiency of which is hereby
expressly acknowledged, the parties do hereby agree as follows:
1. INTERPRETATION
1.1. In this Agreement, including the Schedules hereto, unless the context
otherwise requires, the following words and expressions shall have the
following meanings:
(a) "Acquiring Party" has the meaning ascribed to it in section 13.1;
(b) "Affiliate" means with respect to a party, any individual, corporation,
body corporate, partnership, association, unincorporated organization or
any other legal entity which directly or indirectly controls, is
controlled by, or is under common control with that party. For the
purposes of the preceding sentence, a corporation is controlled by a
person or entity when (i) shares of the corporation carrying more than
50% of the votes for the election of directors are held other than by
way of security only, by or for the benefit of that person or entity;
and (ii) the votes carried by the shares mentioned in paragraph (i) are
sufficient, if exercised, to elect a majority of directors of the
corporation;
(c) "Agreement" means this Option Agreement as amended in writing from time
to time;
(d) "Agreement Date" means the date of this Agreement as first set out above;
(e) "Area of Common Interest" means the area which is within 1 (one)
kilometer of the exterior boundaries of the Property;
(f) "Confidential Information" means the terms of this Agreement and any
information regarding or relating to the Mining Work;
(g) "Defaulting Party" means a party which is in default with respect to the
performance of any of its duties or obligations under this Agreement;
(h) "Exchange" means the TSX Venture Exchange;
(i) "Exchange Acceptance" means the acceptance for filing of this Agreement
on behalf of the Optionor by the Exchange;
(j) "Expenditures" means all cash, expenses, obligations and liabilities of
whatever kind or nature spent or incurred directly or indirectly in
connection with Mining Work and, without limiting the generality of the
foregoing, includes monies expended in acquisition of new claims,
constructing or acquiring all facilities, buildings, machinery and
equipment in connection with Mining Work, in paying any taxes, fees,
charges, payments or rentals (including payments made in lieu of
assessment work) or otherwise paid to keep the Property or any portion
thereof in good standing including any payment to or in respect of
acquiring any agreement or confirmation from any holder of surface rights
respecting the Property or any portion thereof, in carrying out any
survey of the Property or any portion thereof, in paying the fees, wages,
salaries, travelling expenses, fringe benefits (whether or not required
by law) of all persons engaged in work with respect to and for the
benefit of the Property or any portion thereof, in paying for the food,
lodging and other reasonable needs of such persons, in supervising and
managing any work done with respect to and for the benefit of the
Property or any portion thereof including overhead charges not to exceed
15% claimed by the Operator or in any other respects necessary for the
due carrying out of Mining Work and in connection with milling,
processing and treatment operations, and in providing supervision,
management, administration and accounting, financing, marketing,
engineering, legal and other support services in connection with Mining
Work. The certificate of an officer of the party incurring Expenditures
as to the amount of Expenditures incurred pursuant to this Agreement
and as to their categorization shall be prima facie evidence of such
amounts having been incurred;
(k) "Expert" means an independent person with recognized expertise in the
area of the subject matter of a dispute under section 18(d);
(l) "Intervening Event" has the meaning ascribed to it in section 16.1;
(m) "Losses" means losses from operations on the Property and shall include
any loss, liability, claim, demand, damage, expense, injury or death;
(n) "Mining Work" means every kind of work done on or in respect of the
Property or the products therefrom by or under the direction of or on
behalf of or for the benefit of the parties or any one or more of them
and, without limiting the generality of the foregoing, includes
assessment work, geophysical, geochemical and geological surveying,
studies and mapping, investigating, drilling, designing, examining,
equipping, improving, surveying, shaft sinking, raising, crosscutting
and drifting, searching for, digging, trucking, sampling, working and
procuring minerals, ores, metals and concentrates, surveying and
bringing any mineral claims or other interests to lease or patent,
reporting and all other work usually considered to be prospecting,
exploration, development and mining work;
(o) "Net Smelter Return" has the meaning ascribed to it in Schedule "A" of
the property transfer agreement dated July 10, 2001 made between Newmont
Canada Limited and Rimfire Minerals Corporation, attached hereto as
Schedule "B";
(p) "Non-Defaulting Party" means any party affected by a default of a
Defaulting Party;
(q) "Non-Operator" means the party which is not the Operator;
(r) "Operator" means the party managing the day to day exploration activities
on the Property as provided for in Article 9;
(s) "Option" means the option granted by Optionor to the Optionee as more
particularly set forth in section 4;
(t) "Optionor" means Rimfire Minerals Corporation;
(u) "Optionee" means Plutonic Capital Corp;
(v) "Property" means the lands located in the Liard Mining Division of
British Columbia, as more particularly described in Schedule "A" hereto,
and shall include any renewal thereof and any form of successor or
substitute title thereto;
(w) "Qualifying Transaction" has the meaning set out in Exchange Policy 2.4.
In the context of this Agreement, qualifying transaction means the
Option to purchase a 51% interest in the Property by the Optionee
pursuant to the terms of the Agreement;
(x) "Right of First Refusal" means the right of first refusal granted in the
property transfer agreement dated July 10, 2001 made between Newmont
Canada Limited and Rimfire Minerals Corporation and attached hereto as
Schedule "B";
(y) "Shares" means the 200,000 common shares in the capital of the Optionee;
and
(z) "Transfer Restrictions" means such restrictions on the transfer of the
Shares to be issued to the Optionor pursuant to this Agreement as may
be required by applicable securities legislation (including Multilateral
Instrument 45-103 as adopted by the British Columbia Securities
Commission) and the policies of the Exchange.
1.2. All references to $ or "dollars" in this Agreement means Canadian
dollars.
2. REPRESENTATIONS AND WARRANTIES
2.1. The Optionor represents and warrants to the Optionee that:
(a) it is a company duly incorporated and validly subsisting and is in good
standing with respect to the filing of its annual reports under the laws
of the jurisdiction of its incorporation and is qualified to do business
in the jurisdiction in which the Property is located;
(b) it has full power and absolute authority and capacity to enter into this
Agreement and to carry out the transactions contemplated hereby except
where regulatory approval is required;
(c) it has duly obtained all corporate authorizations for the execution,
delivery and performance of this Agreement and such execution, delivery
and performance and the consummation of the transactions herein
contemplated will not conflict with, or accelerate the performance
required by or result in any breach of any covenants or agreements
contained in or constitute a default under, or result in the creation
of any encumbrance, lien or charge under the provisions of its constating
documents or any shareholders' or directors' resolution, indenture,
agreement or other instrument whatsoever to which it is a party or by
which it is bound or to which it may be subject and will not contravene
any applicable law;
(d) the Property is not the whole or substantially the whole of the
Optionor's assets or undertaking;
(e) it is the registered and beneficial owner of a 100% interest in the
Property, subject to the Net Smelter Return and the Right of First
Refusal. The Property is not subject to any liens, charges, royalties
or encumbrances of any kind and is not subject to any right, claim or
interest of any other person;
(f) it has obtained written waiver of the right of first refusal to the entry
into this Agreement from Newmont Canada Limited, as provided in the Right
of First Refusal (attached hereto as Schedule "C");
(g) the Property is in good standing under the laws of British Columbia and
all payments and filings required to be made and filed in connection with
the Property have been made and filed;
(h) it has complied with all of the laws in effect in the jurisdiction in
which the Property is located with respect to the Property;
(i) the Optionee may enter in, under or upon the Property for all purposes of
this Agreement without making any payment to, and without accounting to
or obtaining the permission of, any other person other than any payments
required to be made under this Agreement;
(j) there is no adverse claim or challenge against or to the ownership of or
title to the Property or any portion thereof, and to the best of its
knowledge there is no basis therefor, and there are no outstanding
agreements or options to acquire or purchase the Property or any portion
thereof or interest therein, save for the Right of First Refusal;
(k) except for the Net Smelter Return, no person has any royalty or other
interest whatsoever in production or profits from the Property or any
portion thereof;
(l) except as permitted under any laws of the jurisdiction in which the
Property is located, to the best of the knowledge and belief of the
Optionor, its principals or management after having made reasonable
inquiry:
(i) there has been no material spill, discharge, leak emission, ejection,
escape, dumping, or any release or threatened release of any kind, of
any toxic or hazardous substance or waste (as defined by any applicable
law) from, on, in or under the Property, or into the environment;
(ii) no toxic or hazardous substance or waste has been disposed of or is
located on the Property as a result of the activities of the Optionor
or its predecessors in interest;
(iii) no toxic or hazardous substance or waste has been treated on or is now
stored on the Property; and
(iv) there is no other matter which has been a breach of applicable
environmental laws or which could result in liability to a party
hereunder.
2.2 The Optionee represents to the Optionor that:
(a) it has the full power and absolute authority and capacity to enter into
this Agreement and to carry out the transactions contemplated hereby and
is in good standing with respect to the filing of its annual reports under
the laws of the jurisdiction of its incorporation and is or will be
qualified to do business in the jurisdiction in which the Property is
located;
(b) it has duly obtained all corporate authorizations for the execution,
delivery and performance of this Agreement and such execution, delivery
and performance and the consummation of the transactions herein
contemplated will not conflict with, or accelerate the performance
required by or result in any breach of any covenants or agreements
contained in or constitute a default under, or result in the creation
of any encumbrance, lien or charge under the provisions of its constating
documents or any shareholders' or directors' resolution, indenture,
agreement or other instrument whatsoever to which it is a party or by
which it is bound or to which it may be subject and will not contravene
any applicable law.
2.3 The representations and warranties hereinbefore set out are conditions on
which the parties have relied in entering into this Agreement, are to
be construed as both conditions and warranties and shall, regardless of
any investigation which may have been made by or on behalf of any party
as to the accuracy of such representations and warranties, survive the
closing of the transactions contemplated hereby and the acquisition of
any interest in the Property hereunder and each of the parties will
indemnify and save the other harmless from all loss, damage, costs,
actions and suits arising out of or in connection with any breach of
any representation or warranty contained in this Agreement.
3. CONDITION PRECEDENT
3.1 This Agreement is subject to the Optionor obtaining Exchange Acceptance
hereof.
3.2 The Optionee represents that it intends to take such steps as are
necessary to have this Agreement accepted by the Exchange as a Qualifying
Transaction prior to March 1, 2003. The Optionee acknowledges and agrees
that if the Qualifying Transaction does not occur prior to March 1, 2003,
it will not be in a position to comply with section 4 and the Option
granted by this Agreement will terminate in accordance with section 8.
3.3 If the condition precedent in section 3.1 has not been satisfied within
120 days of the Agreement Date, the Optionee may, by notice in writing
to the Optionor, terminate this Agreement. Notwithstanding anything
contained in this section, if no notice of termination has been given
pursuant to this section and the condition precedent in section 3.1
is at any time satisfied, the Optionee will not have the right to
terminate this Agreement pursuant to this section.
4. OPTION
4.1 The Optionor hereby irrevocably grants the Optionee the exclusive right
to acquire an undivided 51% legal and beneficial interest in the Property
in consideration of the total cash payment of $130,000, the issuance of
200,000 Shares to the Optionor (or payment of cash in lieu at the
Optionee's election as provided for in subsections (b), (c), (d), (e) and
(b) below), and the spending of $1,435,000 of Expenditures on the
Property. The Optionee shall earn the 51% interest by:
(a) paying $2,000 cash to the Optionor by July 24, 2002 (the execution date
of the letter of intent made between the parties hereto with respect to
the Option), which payment has been made;
(b) paying an additional $13,000 cash to the Optionor upon the Exchange
Acceptance;
(c) paying an additional $15,000 cash and issuing 50,000 of the Shares (or
paying $20,000 in lieu) to the Optionor and incurring additional
Expenditures on the Property of at least $185,000 no later than July 24,
2003;
(d) paying an additional $25,000 cash and issuing an additional 50,000 of the
Shares (or paying $35,000 in lieu) to the Optionor and incurring
additional Expenditures on the Property of at least $250,000 no later
than July 24, 2004;
(e) paying an additional $35,000 cash and issuing an additional 50,000 of
the Shares (or paying $60,000 in lieu) to the Optionor and incurring
additional Expenditures on the Property of at least $400,000 no later
than July 24, 2005; and
(f) paying an additional $40,000 cash and issuing an additional 50,000 of the
Shares (or paying $85,000 in lieu) to the Optionor and incurring
additional Expenditures on the Property of at least $600,000 no later
than July 24,2006.
4.2 Each issuance of the Shares pursuant to sections 4.1 (c), (d), (e) and
(f) is subject to prior acceptance by the Exchange of a technical report
prepared in accordance with National Instrument 43-101 summarizing the
exploration work done on the Property and recommending further work on
the Property.
4.3 The Optionor acknowledges that any Shares issued by the Optionee pursuant
to this section will be subject to the Transfer Restrictions.
4.4 The Optionee acknowledges that its interest in the Property is subject to
the Right of First Refusal and that any interest it earns in the Property
upon exercise of the Option granted by this Agreement will be subject to
its proportionate share of the Net Smelter Return.
4.5 During the term of this Agreement, the Optionor will not encumber the
property or its interest therein, any improvements on the property or any
of the appurtenances thereto.
5. OPTION ONLY
5.1 This Agreement confers an option only and, except as otherwise expressly
provided herein, the doing of any act or the making or incurring of any
Expenditures by a party shall not be construed as obligating such party
to do any further or other act or make or incur any further or other
Expenditures.
6. VESTING OF INTEREST
6.1 When the Optionee has paid a total of $130,000 to the Optionor, issued
200,000 Shares (or paid cash in lieu) to the Optionor and incurred
$1,435,000 in Expenditures on the Property required by section 4.1, the
Optionee will have vested an undivided beneficial 51% right, title and
interest in the Property, subject to its proportionate share of the Net
Smelter Return.
6.2 Upon the vesting of the Optionee's interest the Optionor shall provide
executed transfers of the Property in blank to a mutually acceptable
escrow agent to be held in escrow until such time as the Option terminates
or is exercised at which time that percentage interest if any earned by
the Optionee shall be transferred to the Optionee.
7. JOINT VENTURE
7.1 Upon the vesting of the Optionee's interest, any further exploration and
development on the Property and any operation of the Property as a Mine
will be carried out as a joint venture between the parties, with each
party contributing to said joint venture in proportion to its interest
in the Property from time to time.
7.2 The terms of the joint venture would be made subject to a formal Joint
Venture Agreement including, but not limited to, the following:
(a) All operations on and in connection with the Property shall be managed
by a committee (the "Management Committee") comprising two
representatives of each party. All decisions of the Management Committee
shall be made by simple majority of the votes cast. The representative
of a party in the Management Committee shall have such number of votes
equal to such party's Interest at the time of the vote. If there is a
tied vote, the representative of the operator shall have the additional
casting vote.
(b) The Optionee shall be the initial Operator and shall remain as the
Operator for as long as its Interest is 50% or greater. All operations
on and in connection with the Property shall be carried out exclusively
by the Operator and the Operator shall have the right to retain such
subcontractors as it sees fit. If the Optionee's Interest is or becomes
less than 50%, the party with the greatest Interest shall become the
Operator.
(c) At the commencement of the joint venture, the parties' respective
Interests and deemed exploration expenditures shall be as follows:
Deemed
Exploration
Party Interest Expenditures
Rimfire 49% $1,378,000
Plutonic 51% $1,435,000
(d) A party shall elect whether to contribute to each annual work program and
budget. If a party elects not to contribute to a budget, its Interest
shall be reduced, such that a party's Interest at any time shall be
calculated by dividing the subject party's deemed and actual exploration
expenditures by the deemed and actual exploration expenditures of all of
the parties, and multiplying the resulting fraction by 100.
(e) If at any time a party's Interest is reduced to below 10%, it shall be
deemed to have conveyed its Interest to the other party in consideration
of the right to receive a 2% net smelter return royalty, and it will
cease to hold any interest in the Property.
8. TERMINATION OF OPTION
8.1 Should the exploration Expenditure, payment of cash consideration and
required share issuances (or payment of cash in lieu) set out in section
4 not be completed in full on or before their respective due dates then
the Option shall terminate and the Optionee shall earn no interest in the
Property pursuant to the terms hereof.
8.2 The Optionee may terminate this Agreement at any time by giving written
notice of such termination to the Optionor. This Agreement shall
terminate on the date the Optionor is deemed to have received such
notice in accordance with section 14 herein. Upon such termination, this
Agreement shall be of no further force and effect, except that the
Optionee shall be required to make any payments or share issuances due
and owing at the time the notice of termination is deemed to have been
received by the Optionor, and the Optionee shall forthwith deliver all
records of Mining Work, including maps and data derived therefrom in its
possession to the Optionor.
8.3 Where notice of termination is given by either party, the Optionor will
be free to make offers to other parties respecting the Property and the
interest offered herein.
8.4 If this Agreement is terminated by the Optionee, the Optionee shall take
such commercially reasonable steps as are necessary to ensure that the
Property remains in good standing for a period of at least one year
following the date of termination.
9. OPERATOR
9.1. For expenditures incurred up to July 24, 2003, the Optionee shall be the
Operator for the Property and shall manage the day to day exploration
activities on the Property.
9.2. For expenditures incurred subsequent to July 24, 2003 and until the
Optionee has exercised its Option in full, the Optionor shall be the
Operator for the Property and shall manage the day to day exploration
activities on the Property.
9.3. The Operator shall have full right, power and authority to do everything
necessary or desirable in connection with the Mining Work, including,
without limiting the generality of the foregoing, the right, power and
authority to:
(a) regulate access to the Property subject only to the right of
representatives of the Non-Operator to have access to the Property at
all reasonable times for the purpose of inspecting Mining Work thereon
at its own risk and expense; and
(b) employ and engage such employees, agents and independent contractors as
it may consider necessary or advisable to carry out its duties and
obligations hereunder and in this connection to delegate any of its
powers and rights to perform its duties and obligations hereunder.
9.4 During its tenure as Operator, the Optionee shall be entitled to
possession of the Property and to enter upon the Property to erect
buildings, to install machinery thereon and to explore and develop the
Property. In the event that the Optionee does not exercise the Option,
all buildings, plant, equipment, machinery, tools, appliances, supplies
and other chattels and fixtures which may have been brought by the
Optionee upon the Property, either before or during the currency of this
Agreement, may be removed by the Optionee at any time no later than 180
days after the termination hereof. Any property or assets not removed
by the Optionee within the said 180 days shall, upon the expiry of such
period, upon election by the Optionor become the property of the
Optionor. Should the Optionee elect not to retain the Property or assets
left on the Property, the Optionor shall, upon notice to the Optionee,
dispose of same. The Optionee shall be liable for all reasonable costs,
net of any recoveries, incurred by the Optionor on disposal of the
Property or assets.
9.5 For the Optionor's services as Operator under this Agreement, the
Optionor shall be paid a management fee (the "Management Fee") equivalent
to ten percent (10%) of exploration expenditures on the Property.
10. DUTIES AND OBLIGATIONS OF THE OPERATOR
10.1. The Operator agrees that during the term of this Agreement it shall:
(a) carry out exploration and development work on the Property in accordance
with recognized good and workmanlike exploration and engineering
practices and in conformity in all respects with all applicable
governmental mining laws and regulations;
(b) keep the Property free of liens, including builder's liens and miner's
liens, and should any liens be filed, remove the same within thirty (30)
days of their filing;
(c) propose budgets and work plans;
(d) maintain the mineral rights comprising the Property in good standing;
(e) at all times maintain and keep true and correct records of all
expenditures incurred, as well as all other data necessary or proper
for the settlement of accounts between the parties hereto in connection
with their rights and obligations under this Agreement. Such records
shall be open at all reasonable times upon reasonable notice for
inspection by the Non-Operator as applicable or its duly authorized
representative;
(f) upon the termination of this Agreement, leave the Property in a safe
condition in accordance with applicable statutes and regulations,
including environmental restoration requirements; and
(g) provide the non-Operator with an annual report within 30 days after each
calendar year-end indicating expenditures made during such calendar year,
the status of exploration on the Property and copies of factual data
generated during operations; The non-Operator shall have access to the
Property and to the Operator's exploration records with respect to the
Property at all times provided that it shall not unduly interfere with
or disrupt the activities of the Operator. Except as provided in section
12 below, all reports received by the non-Operator shall be kept
confidential and shall not be released to any other party without the
prior written consent of the Operator, which consent shall not be
unreasonably withheld.
10.2. The Non-Operator agrees to indemnify and hold harmless the Operator
from and against any Losses arising out of or in connection with the
Operator's operations or activities on the Property, provided the
Operator has complied with subsections 10.1(a) through (g) herein.
Without limiting the generality of the foregoing, the non-Operator
covenants and agrees to indemnify and save the Operator harmless from
Losses resulting from any of the following occurrences where they are the
result of the Operator's Mining Work on the Property in compliance with
subsections 10.1(a) through (g) herein:
(a) any material, spill, discharge, leak, emission, ejection, escape,
dumping, or any release or threatened release of any kind, of any toxic
or hazardous substance or waste (as defined by any applicable law) from,
on in or under the Property, or into the environment, except releases
permitted or otherwise authorized by such law;
(b) the disposal or location on the Property of any toxic or hazardous
substance or waste; and
(c) the treatment or storage on the Property of any toxic or hazardous
substance or waste.
11. TRANSFER RESTRICTIONS
11.1 This Agreement, and all rights and obligations hereunder may be assigned,
in whole or in part, by either party hereto with the consent of the
other, not to be unreasonably withheld or denied. Any assignment of
interest under this Agreement shall be made expressly subject to this
Agreement and the Right of First Refusal and shall require the assignee
to agree in writing to assume all of the obligations of the assigning
party as they relate to the interest assigned. No assignment shall be
effective as between the parties until delivery to the non-assigning
party of satisfactory evidence of such assignment.
11.2 Should the Optionee assign the Option to a third party, satisfaction of
the share issuance requirement in section 4.1 may be fulfilled with cash
or shares of another issuer (provided that that issuer is a company
listed on a Canadian Exchange).
12. CONFIDENTIALITY OF INFORMATION
12.1. No party to this agreement shall, without the express written consent
of the other parties, disclose any of the Confidential Information to any
other person or entity nor issue any press releases concerning the
Confidential Information;
12.2 Notwithstanding section 12.1, if the Optionor contemplates selling or
assigning its interest, it shall have the right to disclose to a
prospective purchaser any part of the Confidential Information reasonably
necessary to facilitate the sale or assignment of its interest if it
first obtains an agreement in writing from the prospective purchaser, and
furnishes a copy of such agreement to the Optionee, that the prospective
purchaser shall not disclose to any person or entity any of the
Confidential Information furnished to it.
12.3 Notwithstanding section 12.1, the parties shall have the right to
disclose the Confidential Information with respect to this Agreement,
in strict confidence to their attorneys or financial and mining
consultants.
12.4 Notwithstanding anything contained in section 12.1 of this Agreement,
the parties acknowledge the right and privilege of the Optionee to file,
register and/or to otherwise deposit a copy of this Agreement with any
governmental agencies in order to give third parties notice of this
Agreement, and hereby agree, each with the others, to do or cause to be
done all acts or things reasonably necessary to effect such filing,
registration or deposit.
12.5 This section does not apply to any disclosure which may be required by
law, securities regulatory bodies or stock exchanges governing one or
more of the parties.
13. AREA OF COMMON INTEREST
13.1 During the term of this Agreement, if any party or its Affiliate (the
"Acquiring Party") stakes or otherwise acquires, directly or indirectly,
any right to or interest in, or any right to receive proceeds of
production from, any mining claim, license, lease, grant, concession,
permit, patent, or other form of mineral tenure located wholly or partly
within the Area of Common Interest, the Acquiring Party shall forthwith
give notice to the other party of that staking or acquisition, the total
cost thereof and all details in the possession of the Acquiring Party
with respect to the acquisition, the nature of the property acquired and
the known mineralization.
13.2 The other party may, within 30 days of receipt of the Acquiring Party's
notice, by notice to the Acquiring Party, require that the mineral
properties and the right or interest acquired be included in and
thereafter form part of the Property for all purposes of this agreement.
The other party shall not be required to reimburse the Acquiring Party
for its proportionate share of the out of pocket costs of the
acquisition in question.
13.3 If the other party does not make the election aforesaid within the
period of 30 days, the right or interest acquired shall not form part of
the Property and the Acquiring Party shall be solely entitled thereto.
14. NOTICE
14.1 Any notice required or permitted to be given under this Agreement shall
be in writing and delivered by registered mail, facsimile transmission,
courier or by hand, in each case addressed to the intended recipient at
the address set out on the first page of this Agreement.
14.2 Any notice delivered by registered mail, courier or hand will be deemed
to have been given on the day it was received. Any notice given by
facsimile transmission will be deemed to have been given upon
confirmation by telephone of receipt.
14.3 Any party may give notice in writing of any change of its address. The
address provided in said notice will thereafter be deemed to be the
address of the party for the giving of notice hereunder.
15. ASSOCIATION OF PARTIES
15.1 Nothing contained in this Agreement shall be deemed to constitute a
party a partner, an agent or a legal representative of any other party.
No act done by any party pursuant to the provisions hereof shall operate
to create such a relationship.
16. FORCE MAJEURE
16.1 If a party is prevented from or delayed in incurring any exploration
expenditures, carrying out any programs or performing any of its
obligations required under this Agreement by a cause beyond its
reasonable control (other than its own lack of funds), as long as the
party complies with the provisions of this section, such delay or
failure to act will not constitute a breach of this agreement. A cause
beyond a party's reasonable control shall include, but not be limited
to, acts of God, fire, floods, explosions, labour disputes, strikes,
threats of imminent strike, lockouts or other industrial disturbances,
plant breakdowns or failure of operating equipment, interruptions or
delays in transportation, war, insurrection or mob violence,
nationalization, laws, rules and regulations or orders of any duly
constituted governmental authority, the inability to obtain on reasonable
terms required permits, licenses or other authorizations, or non-
availability of labour, equipment or materials, or any other matter
similar or dissimilar to the above that constitutes an event of force
majeure (each an "Intervening Event").
16.2 All time limits imposed by this Agreement will be extended by a period
equivalent to the period of delay resulting from an Intervening Event.
16.3 A party that claims an Intervening Event has occurred must, insofar as
possible, promptly give written notice to the other party of the
Intervening Event and the particulars thereof.
16.4 If a party has not taken all reasonable steps to prevent the occurrence
of an Intervening Event it may not rely on section 16.1. Where a party
claims that an Intervening Event has occurred it must perform its
obligations under this Agreement to the extent that it is possible and
practical to do so. Nothing herein will require such party to settle or
adjust any labour dispute or to question or to test the validity of any
law, rule, regulation or order of any duly constituted governmental
authority.
17. DEFAULT
17.1. This section does not apply where a party defaults on its obligations
under section 4.
17.2 Where a default has occurred, a Non-Defaulting Party may provide written
notice to the Defaulting Party specifying the default. If within 30 days
(or, if the default cannot reasonably be cured within 30 days, within
such period as may reasonably be required to cure the default) after the
giving of notice of default by the Non-Defaulting Party or parties, the
Defaulting Party has failed to cure the default, the Non-Defaulting Party
shall then be entitled to seek any remedy it may have on account of the
default. The Defaulting Party shall not lose any rights under this
Agreement, nor shall the Agreement or the Option, as the case may be,
terminate upon notice of the Default being given by the Non-Defaulting
Party.
18. DISPUTE RESOLUTION
18.1. Any dispute arising out of or in connection with this Agreement shall be
resolved in the following manner:
(a) the disputing party will provide the particulars of the dispute to the
non-disputing party as soon as practicable;
(b) upon the non-disputing party receiving the particulars, the non-disputing
party will have 10 business days to provide the disputing party with a
response to the particulars;
(c) upon the disputing party receiving the non-disputing party's response, the
parties will have 10 business days thereafter during which they may
attempt to resolve the dispute;
(d) if the parties are unable to resolve the dispute within 10 business days,
the dispute will be submitted by the parties to a mutually agreed upon
Expert for resolution and the parties will split equally the costs
incurred for this dispute resolution process;
(e) if the parties are unable to agree upon an Expert for the dispute within
10 business days after the end of the period referred to in subsection
(c) or if one or both of the parties refuses to accept the decision of
the Expert, the parties will submit the dispute to arbitration as
described in subsection (f) below; and
(f) any dispute which is not resolved by the dispute resolution process as
contemplated by this section, will be submitted to binding arbitration
pursuant to the Commercial Arbitration Act (British Columbia), and the
costs of such arbitration will be paid as determined pursuant to the
arbitration.
19. GENERAL
19.1 This Agreement shall be governed by and interpreted in accordance with
the laws of British Columbia.
19.2 This Agreement embodies the entire agreement and understanding among
the parties hereto and supersedes all prior agreements and undertakings,
whether oral or written, relative to the subject matter hereof.
19.3 Time shall be of the essence of this Agreement.
19.4 The recitals set out at the beginning of this Agreement do not form part
of this Agreement.
19.5 The headings of the sections of this Agreement are for convenience only
and do not form a part of this Agreement. They are not intended to affect
the construction of anything herein contained or govern the rights and
liabilities of the parties.
19.6 Notwithstanding anything to the contrary herein contained, this
Agreement shall be subject to Exchange Acceptance and the prior receipt
of any requisite third party consents.
19.7 Upon the written request of any of the parties, the other parties agree
to furnish such additional further assurances or documents as may be
reasonably necessary to carry out the intent, purposes and terms of this
Agreement.
19.8 This Agreement shall enure to the benefit of and be binding upon the
parties hereto and their respective successors, permitted assigns, heirs,
administrators and legal representatives.
19.9 This Agreement may only be changed by an agreement in writing, duly
executed by the party or parties against which enforcement, waiver,
change, modification or discharge is sought.
19.10 If any one or more of the provisions contained herein should be held to
be invalid, unenforceable or illegal in any respect in any jurisdiction,
the validity, legality and enforceability of such provision shall not in
any way be affected or impaired thereby in any other jurisdiction and
the validity, legality and enforceability of the remaining provisions
contained herein shall not in any way be affected or impaired thereby.
19.11 Words used herein importing the singular number only shall include the
plural, and vice-versa, and words importing the masculine gender shall
include the feminine and neuter genders, and vice-versa, and words
importing persons shall include firms and corporations.
19.12 Waiver of any provisions herein by any party hereto shall not be
construed as a waiver of any other provisions or terms of this
Agreement.
19.13 This Agreement may be executed in counterparts which may be delivered
by facsimile. Each executed counterpart shall be deemed to be an original
and all such counterparts when read together constitute one and the same
instrument.
IN WITNESS WHEREOF the parties hereto have executed this Agreement on the date
first above written.
RIMFIRE MINERALS CORPORATION
Per: XXXXX X. XXXXXXXXX
Authorized Signatory
PLUTONIC CAPITAL CORP.
Per: XXXXXX XXXXXXX
Authorized Signatory
This agreement was prepared by Xxxxxx & Company, Barristers & Solicitors, for
Rimfire Minerals Corporation. It is recommended that other parties hereto
obtain independent legal advice with respect to the provisions contained
herein.
This is SCHEDULE "A" to the Option Agreement dated October 28th, 2002 between
RIMFIRE MINERALS CORPORATION and PLUTONIC CAPITAL CORP.
The Tide Property consists of 5 mineral claims totaling 86 units in the Liard
Mining Division of British Columbia, as follows:
Claim Name Mineral Tenure No. of Units Record Date Expiry Date
Bow-1 321461 6 October 8, 1993 October 8, 2006
Bow-2 321462 20 October 9, 1993 October 9, 2006
Bow-3 321463 20 October 9, 1993 October 9, 2006
Bow-4 321464 20 October 8, 1993 October 8, 2006
Arrow 340087 20 September 14, 1995 Sept. 14, 2006
86
This is SCHEDULE "B" to the Option Agreement dated October28, 2002 between
RIMFIRE MINERALS CORPORATION and PLUTONIC CAPITAL CORP.
Property Transfer Agreement with Newmont Canada Limited
This is SCHEDULE "C" to the Option Agreement dated October28, 2002 between
RIMFIRE MINERALS CORPORATION and PLUTONIC CAPITAL CORP.
Acknowledgement of Newmont Canada to Waiver of Right of First Refusal
OPTION AGREEMENT
THIS AGREEMENT is made effective as of the 18th day of December, 2002.
BETWEEN:
RIMFIRE MINERALS CORPORATION, a company incorporated under the laws of the
Province of British Columbia and having its registered
and records office at 700 - 000 Xxxx Xxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxx
Xxxxxxxx,X0X 0X0
(hereinafter referred to as "Optionor")
OF THE FIRST PART
AND:
STIKINE GOLD CORPORATION, a company incorporated under the laws of British
Columbia and having its head office at 000 - 0000 Xxxx
Xxxxxx, Xxxxxxxxx, Xxxxxxx Xxxxxxxx, X0X 0X0
(hereinafter referred to as "Optionee")
OF THE SECOND PART
WHEREAS:
A. The Optionor holds a 50% interest and has an option to acquire an
additional 50% interest in and to the Xxxx Property from Xxxxx Xxxxxx
(the "Xxxxxx Option Agreement");
B. The Optionee holds a 100% beneficial interest in mineral claims adjacent
to or in the vicinity of the Xxxx Property (the "Stikine Property");
C. The Xxxx Property and the Stikine Property are located in the Liard
Mining Division of British Columbia, hereinafter collectively referred to
as the Xxxxxxxx Gold Property, as more particularly described in Schedule
"A" attached to this Agreement (the "Property");
C. The Optionee intends to apply for listing of its shares on the TSX Venture
Exchange prior to June 15, 2003; and
D. The Optionor has agreed to grant to the Optionee an option to acquire a
70% interest in and to the Property on the terms and conditions stated in
this Agreement.
NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of the
premises and the mutual covenants, representations and warranties given by each
of the parties to the other, the receipt and sufficiency of which is hereby
expressly acknowledged, the parties do hereby agree as follows:
1. INTERPRETATION
1.1 In this Agreement, including the Schedules hereto, unless the context
otherwise requires, the following words and expressions shall have the
following meanings:
(a) "Acquiring Party" has the meaning ascribed to it in section 15.1;
(b) "Affiliate" means with respect to a party, any individual, corporation,
body corporate, partnership, association, unincorporated organization or
any other legal entity which directly or indirectly controls, is
controlled by, or is under common control with that party. For the
purposes of the preceding sentence, a corporation is controlled by a
person or entity when (i) shares of the corporation carrying more than
50% of the votes for the election of directors are held other than by
way of security only, by or for the benefit of that person or entity;
and (ii) the votes carried by the shares mentioned in paragraph (i) are
sufficient, if exercised, to elect a majority of directors of the
corporation;
(c) "Agreement" means this Option Agreement as amended in writing from time
to time;
(d) "Agreement Date" means the date of this Agreement as first set out above;
(e) "Area of Common Interest" means the area which is within 4 kilometers of
the perimeter of the Xxxx Property excluding any area covered by the
Stikine Property;
(f) "Associate" has the meaning set out in the Company Act (British Columbia);
(g) "Commercial Production" means the operation of the Property as a
producing Mine and the production of mineral products therefrom
(excluding bulk sampling, pilot plant or test operations);
(h) "Confidential Information" means the terms of this Agreement and any
information regarding or relating to the Mining Work;
(i) "Defaulting Party" means a party which is in default with respect to the
performance of any of its duties or obligations under this Agreement;
(j) "Development" means operations or work (other than mining work)
performed for the purpose of or in connection with preparation for mining,
including the construction or installation of a mill or any other
treatment facilities, used for the mining, handling, milling, processing,
or other beneficiation of mineral products. The active pursuit of
obtaining any authorization or licenses related to any of the foregoing
activities included in this definition shall also be considered to be an
act of Development;
(k) "Exchange" means the TSX Venture Exchange;
(l) "Exchange Acceptance" means the acceptance for filing of this Agreement
on behalf of the Optionor by the Exchange;
(m) "Expenditures" means all cash, expenses, obligations and liabilities of
whatever kind or nature spent or incurred directly or indirectly in
connection with Mining Work and, without limiting the generality of the
foregoing, includes acquisition of new claims, monies expended in
constructing or acquiring all facilities, buildings, machinery and
equipment in connection with Mining Work, in paying any taxes, fees,
charges, payments or rentals (including payments made in lieu of
assessment work) or otherwise paid to keep the Property or any portion
thereof in good standing including any payment to or in respect of
acquiring any agreement or confirmation from any holder of surface
rights respecting the Property or any portion thereof, in carrying
out any survey of the Property or any portion thereof, in paying the
fees, wages, salaries, travelling expenses, fringe benefits (whether
or not required by law) of all persons engaged in work with respect to
and for the benefit of the Property or any portion thereof, in paying for
the food, lodging and other reasonable needs of such persons, in
supervising and managing any work done with respect to and for the
benefit of the Property or any portion thereof including overhead charges
claimed by the Operator or in any other respects necessary for the due
carrying out of Mining Work and in connection with milling, processing
and treatment operations, and in providing supervision, management,
administration and accounting, financing, marketing, engineering, legal
and other support services in connection with Mining Work and the
preparation of a Feasibility Report. The certificate of an officer of the
party incurring Expenditures as to the amount of Expenditures incurred
pursuant to this Agreement and as to their categorization shall be prima
facie evidence of such amounts having been incurred;
(n) "Expert" means an independent person with recognized expertise in the area
of the subject matter of a dispute under section 20;
(o) "Feasibility Report" means a detailed report, demonstrating the
feasibility of placing any part of the Property into Commercial
Production at an acceptable rate of return on capital, in such form and
detail as is customarily required by institutional lenders of major
financing for mining projects, and shall include a reasonable assessment
of the mineable ore reserves and their amenability to treatment, a
complete description of the work, equipment and supplies required to
bring such part of the Property into Commercial Production and the
estimated cost thereof, a description of the mining methods to be
employed and a financial appraisal of the proposed operations supported
by explanations of the following information:
(i) a description of that part of the Property to be covered by the proposed
Mine;
(ii) the estimated recoverable reserves of minerals and the estimated
composition and content thereof;
(iii) the proposed procedure for development, mining and production;
(iv) results of ore amenability tests;
(v) the nature and extent of the facilities proposed to be acquired or
constructed, which may include mill facilities if the size, extent and
location of the ore body makes such mill facilities feasible, in which
event, the study shall also include a preliminary design for such mill;
(vi) the total costs, including capital budget, which are reasonably required
to purchase, construct and install all structures, machinery and
equipment required for the proposed Mine, including a schedule of timing
of such requirements;
(vii) all environmental impact studies and costs;
(viii) the period in which it is proposed the Property shall be brought to
Commercial Production;
(ix) such other data and information as are reasonably necessary to
substantiate the existence of an ore deposit of sufficient size and grade
to justify development of a mine, taking into account all relevant
business, tax and other economic considerations; and
(x) working capital requirements for the initial four month operation of the
Property as a mine or such longer period as may be reasonably justified in
the circumstances;
(p) "Intervening Event" has the meaning ascribed to it in section 18.1;
(q) "Joint Venture" means the joint venture between the parties formed
pursuant to section 8.1;
(r) "Mine" means the workings established and assets acquired, including,
without limiting the generality of the foregoing, development headings,
plant and concentrator installations, infrastructure, housing, airport
and other facilities in order to bring the Property into Commercial
Production;
(s) "Listing Date" means the date the Optionee's Shares are listed for
trading on the Exchange;
(t) "Losses" has the meaning ascribed to it in section 11.1;
(u) "Manager" means the manager as appointed pursuant to section 8.2(a)(iii);
(v) "Management Committee" means the committee formed pursuant to section
8.2(a)(ii);
(w) "Mining Work" means every kind of work done on or in respect of the
Property or the products therefrom by or under the direction of or on
behalf of or for the benefit of the parties or any one or more of them
and, without limiting the generality of the foregoing, includes
assessment work, geophysical, geochemical and geological surveying,
studies and mapping, investigating, drilling, designing, examining,
equipping, improving, surveying, shaft sinking, raising, crosscutting
and drifting, searching for, digging, trucking, sampling, working and
procuring minerals, ores, metals and concentrates, surveying and bringing
any mineral claims or other interests to lease or patent, reporting and
all other work usually considered to be prospecting, exploration,
development and mining work;
(x) "Net Profits Interest" has the meaning ascribed to it in Schedule "B"
attached to this Agreement;
(y) "Net Smelter Return" has the meaning ascribed to it in the Xxxxxx Option
Agreement;
(z) "Non-Defaulting Party" means any party affected by a default of a
Defaulting Party;
(aa) "Option" means the option granted by the Optionor to the Optionee as
more particularly set forth in section 4;
(bb) "Optionor" means Rimfire Minerals Corporation;
(cc) "Optionee" means Stikine Gold Corporation;
(dd) "Operator" means Stikine Gold Corporation;
(ee) "Product" means all ores, metals and minerals mined or extracted from the
Property and any concentrates produced therefrom;
(ff) "Property" means the lands located in the Liard Mining division of British
Columbia, as more particularly described in Schedule "A" hereto, and shall
include any renewal thereof and any form of successor or substitute title
thereto;
(gg) "Shares" means common shares in the capital of the Optionee;
(hh) "Transfer Restrictions" means such restrictions on the transfer of the
Shares to be issued to the Optionor pursuant to this Agreement as may be
required by applicable securities legislation (including Multilateral
Instrument 45-103 as adopted by the British Columbia Securities
Commission) and the policies of the Exchange; and
(ii) "Xxxxxx Option Agreement" means the option agreement dated May 17,2001
between the Optionor and Xxxxx Xxxxxx.
1.2 All references to $ or "dollars" in this Agreement means Canadian dollars.
2 REPRESENTATIONS AND WARRANTIES
2.1 The Optionor represents and warrants to the Optionee that:
(a) it is a company duly incorporated and validly subsisting and is in good
standing under the laws of the jurisdiction of its incorporation and is
qualified to do business in the jurisdiction in which the Property is
located;
(b) it has full power and absolute authority and capacity to enter into this
Agreement and to carry out the transactions contemplated hereby except
where regulatory approval is required;
(c) it has duly obtained all corporate authorizations for the execution,
delivery and performance of this Agreement and such execution, delivery
and perfomance and the consummation of the transactions herein
contemplated will not conflict with, or accelerate the performance
required by or result in any breach of any covenants or agreements
contained in or constitute a default under, or result in the creation
of any encumbrance, lien or charge under the provisions of its constating
documents or any shareholders' or directors' resolution, indenture,
agreement or other instrument whatsoever to which it is a party or by
which it is bound or to which it may be subject and will not contravene
any applicable law;
(d) the Property is not the whole or substantially the whole of the
Optionor's assets or undertaking;
(e) the Optionor is the owner of a 50% interest in the Property. The
Optionor's 50% interest in the Property is not subject to any liens,
charges, royalties or encumbrances of any kind and will not be subject
to any right, claim or interest of any other person;
(f) the Optionor has the option to earn an additional 50% interest in and to
the Property pursuant to the terms of the Xxxxxx Option Agreement.
Pursuant to the Agreement, as modified, the Optionor's 50% interest,
when earned, will be subject to a 2.5% net smelter return royalty (the
"Net Smelter Return") of which one half is payable to Xxxxxx and one half
to the Optionor;
(g) the Optionor has complied with all of the terms and conditions of the
Xxxxxx Option Agreement, all payments have been made as required under
the Xxxxxx Option Agreement and the Xxxxxx Option Agreement is in good
standing in accordance with its terms and conditions;
(h) to the best of its knowledge, the Property is in good standing under the
laws of British Columbia and all payments and filings required to be made
and filed in connection with the Property have been made and filed;
(i) it has complied with all of the laws in effect in the jurisdiction in
which the Property is located with respect to the Property;
(j) the Optionee may enter in, under or upon the Property for all purposes of
this Agreement without making any payment to, and without accounting to
or obtaining the permission of, any other person other than any payments
required to be made under this Agreement;
(k) to the best of its knowledge, except as disclosed in this Agreement and
the schedules attached hereto, there is no adverse claim or challenge
against or to the ownership of or title to the Property or any portion
thereof, nor is there any basis therefor, and there are no outstanding
agreements or options to acquire or purchase the Property or any portion
thereof or interest therein;
(l) to the best of its knowledge, no person has any royalty or other interest
whatsoever in production or profits from the Property or any portion
thereof except as provided for in the Xxxxxx Option Agreement;
(m) except as permitted under any laws of the jurisdiction in which the
Property is located, to the best of the knowledge and belief of the
Optionor, its principals or management after having made reasonable
inquiry:
(i) there has been no material spill, discharge, leak emission, ejection,
escape, dumping, or any release or threatened release of any kind, of any
toxic or hazardous substance or waste (as defined by any applicable law)
from, on, in or under the Property, or into the environment;
(ii) no toxic or hazardous substance or waste has been disposed of or is
located on the Property as a result of the activities of the Optionor
or its predecessors in interest; and
(iii) no toxic or hazardous substance or waste has been treated on or is now
stored on the Property.
2.2 The Optionee represents to the Optionor that:
(a) it has the full power and absolute authority and capacity to enter into
this Agreement and to carry out the transactions contemplated hereby and
is in good standing under the laws of the Jurisdiction of its
incorporation and is or will be qualified to do business in the
jurisdiction in which the Property is located;
(b) it will observe the terms and the conditions of this Agreement and the
Xxxxxx Option Agreement, including the requirement for any royalties
payable to the Optionor and to Xxxxxx under the Xxxxxx Option Agreement;
and
(c) it has duly obtained all corporate authorizations for the execution,
delivery and performance of this Agreement and such execution, delivery
and performance and the consummation of the transactions herein
contemplated will not conflict with, or accelerate the performance
required by or result in any breach of any covenants or agreements
contained in or constitute a default under, or result in the creation
of any encumbrance, lien or charge under the provisions of its constating
documents or any shareholders' or directors' resolution, indenture,
agreement or other instrument whatsoever to which it is a party or by
which it is bound or to which it may be subject and will not contravene
any applicable law.
2.3 The representations and warranties hereinbefore set out are conditions
on which the parties have relied in entering into this Agreement, are to
be construed as both conditions and warranties and shall, regardless of
any investigation which may have been made by or on behalf of any party
as to the accuracy of such representations and warranties, survive the
closing of the transactions contemplated hereby and the acquisition of
any interest in the Property hereunder and each of the parties will
indemnify and save the other harmless from all loss, damage, costs,
actions and suits arising out of or in connection with any breach of any
representation or warranty contained in this Agreement.
3 CONDITION PRECEDENT
3.1. This Agreement is subject to the Optionor obtaining Exchange Acceptance
hereof.
3.2. If the Exchange Acceptance has not been obtained within 120 days of the
Agreement Date, any party may, by notice in writing to the other party,
terminate this Agreement. Notwithstanding anything contained in this
section, if no notice of termination has been given pursuant to this
section and Exchange Acceptance has been obtained at any time, neither
party will have the right to terminate this Agreement pursuant to this
section.
4 OPTION
4.1 The Optionor hereby irrevocably grants the Optionee the exclusive right
to acquire a 70% interest in the Property, subject to the Xxxxxx Option
Agreement, the Ongoing Expenditure Requirement and the Net Smelter Return,
in consideration of the total cash payment of $75,000, the issuance of
150,000 Shares to the Optionor, the expenditure of $1,500,000 on
exploration and development on the Property and the additional cash and
/or share payments listed in section 4.1(c). The Optionee shall earn
the interest by:
(a) paying an aggregate of $75,000 to the Optionor as follows:
(i) $10,000 upon the execution of this Agreement which sum has been paid;
(ii) $25,000 on or before May 1, 2003; and
(iii) $40,000 on or before May 1, 2004;
(b) issuing 150,000 Shares to the Optionor as follows:
(i) 100,000 Shares by no later than 15 days after the Listing Date and
before June 15, 2003; and
(ii) 50,000 Shares on or before the first anniversary of the Listing Date and
before June 15, 2004;
(c) making additional cash/share payments to the Optionor as follows:
(i) on or before the second anniversary of the Listing Date and before June
15, 2005, paying the Optionor $50,000 cash or, at the election of the
Optionee, issuing to the Optionor Shares having an aggregate market value
of $50,000 based on the average closing price of the Optionee's Shares
for the 10 days preceding the issuance of the Shares;
(ii) on or before the third anniversary of the Listing Date and before
June 15, 2006, paying the Optionor $50,000 cash or, at the election of
the Optionee, issuing to the Optionor Shares having an aggregate market
value of $50,000 based on the average closing price of the Optionee's
Shares for the 10 days preceding the issuance of the Shares;
(d) incurring aggregate Expenditures of $1,500,000 on exploration and
development on the Property as follows:
(i) $125,000 on or before December 31, 2002;
(ii) an additional $300,000 on or before December 31, 2003;
(iii) an additional $350,000 on or before December 31, 2004; and (iv) an
additional $725,000 on or before December 31, 2005.
4.2 The Optionee agrees that in order to earn its interest in the Property as
contemplated by this Agreement, the Listing Date must occur prior to
June 15, 2003. The Optionee acknowledges and agrees that if the Listing
Date does not occur prior to June 15, 2003, it will not be in a position
to comply with sections 4.1(b) and (c) and the Option granted by this
Agreement will terminate in accordance with section 12.1.
4.3 The Optionor acknowledges that any Shares issued by the Optionee pursuant
to this section will be subject to the Transfer Restrictions.
4.4 The Optionee acknowledges that its interest in the Property is subject to
the terms of the Xxxxxx Option Agreement and that any interest it earns
in the Property upon exercise of the Option granted by this Agreement
will be subject to the payment of the Net Smelter Return.
4.5 The Optionee agrees that it will, prior to June 14, 2003, cause its
beneficial interest in the Stikine Property to become a 100% registered
interest.
5 OPTION ONLY
5.1 This Agreement confers an option only and, except as otherwise expressly
provided herein, the doing of any act or the making or incurring of any
Expenditures by a party shall not be construed as obligating such party
to do any further or other act or make or incur any further or other
Expenditures.
6 VESTING OF INTEREST
6.1 When the Optionee has paid a total of $75,000 to the Optionor, issued
150,000 Shares to the Optionor, incurred $1,500,000 in Expenditures on
the Property and made the cash or share payments required by section
4.1(b) and (c) the Optionee will have vested an undivided beneficial 70%
right, title and interest in the Property, subject to the Net Smelter
Return and the Ongoing Expenditure Requirement.
6.2 Upon the vesting of a 70% beneficial interest the Optionor shall execute
such property transfer documents as the Optionee may reasonably deem
necessary to assign, transfer and assure the Optionee's good, safeholding
and marketable title to a 70% interest in the Property and shall deliver
same to the Optionee.
7 FUNDING OBLIGATIONS AFTER VESTING OF INTEREST AND PRIOR
TO FEASIBILITY REPORT
7.1 Following vesting of a 70% interest in the Property with the Optionee,
in each calendar year the Optionee shall incur additional Expenditures
of $500,000 on the Property until such time as a Feasibility Report has
been prepared and approved by the parties (the "Ongoing Expenditure
Requirement"). Expenditures in excess of $500,000 in any calendar year
shall be cumulative with any excess being credited to the expenditure
requirements in subsequent years. The Optionee will have the option,
at its sole discretion, of making a cash payment of $50,000 to the
Optionor in lieu of incurring $500,000 in Expenditures on the Property
in any given year pursuant to the Ongoing Expenditure Requirement.
(a) If in any calendar year during which the Optionee is required to meet the
Ongoing Expenditure Requirement, the Optionee fails to incur the
expenditures necessary to meet the Ongoing Expenditure Requirement and
does not make a $50,000 cash payment to the Optionor in lieu of incurring
such expenditures as permitted by section 7.1:the Optionee's interest in
the Property shall revert to and become the property of the Optionor and
the Optionee shall have no further interest in the Property; and
(b) the Optionee shall take such steps as are necessary to transfer legal
title to the Property to the Optionor.
7.2 Upon the completion of a Feasibility Report, the Ongoing Expenditure
Requirement shall terminate and the Optionee shall not be required to
meet any further ongoing requirements to retain its 70% interest in the
Property.
8 JOINT VENTURE
8.1 Upon vesting of a 70% interest in the Property and delivery of the
Feasibility Report with the Optionee the parties will enter into an
agreement to become joint participants for the express purpose of
exploring, developing, and exploiting mineral deposits on or under the
Property ("Joint Venture").
8.2 The parties acting diligently and in good faith will negotiate and
finalize an industry standard Joint Venture agreement which will contain:
(a) Terms respecting the objectives and operation of the Joint Venture as
follows:
(i) The objectives of the Joint Venture shall be to place the Property into
Commercial Production;
(ii) When the Joint Venture is formed the parties shall form a Management
Committee which shall determine overall policies, objectives,
procedures, methods and actions under the joint venture agreement.
At inception the Management Committee shall be comprised of two members
appointed by the Optionee and one member appointed by the Optionor.
Thereafter if the Optionee's interest is reduced to less than 50% the
Optionee shall be entitled to appoint only one member of the Management
Committee. Accordingly, the Optionor, whose interest has increased to
more than 50%, shall be entitled to appoint two members of the Management
Committee;
(iii) The Management Committee shall appoint a Manager with overall
responsibility for operations. The Manager shall have the right to
charge for its overhead, administration and other unallocatable costs
equal to 10% of the costs of Expenditures. The Management Committee shall
have the authority to make any adjustment to the fee paid to the Manager
from time to time to ensure that the Manager neither gains or loses
financially from it acting as the Manager and subject to any contract
that the Joint Venture may make with a third party Manager;
(iv) The Manager shall prepare and submit to the Management Committee for its
approval programs and budgets that the Manager proposes to conduct on the
Property by the 60th day after completion of each approved program or by
January 1st in each calendar year if no program has been approved and
completed in the prior year;
(v) The Management Committee shall meet and approve the Manager's programs
and budgets by the 30th day after the proposed program was submitted;
(vi) The Joint Venture activities must be undertaken and conducted according
to the approved programs;
(vii) Each party shall have the pro rata right of first refusal if the other
party wishes to sell its interest in the Joint Venture subject to the
right of assignment provisions, the terms of which are set out in section
13.1 of this Agreement; and
(b) Terms respecting the interests of the parties and the dilution of same as
follows:
(i) When the Optionee's interest has vested as provided in section 6.1, the
parties shall have the following initial interests in the Joint Venture:
Optionor - thirty (30%) percent; and Optionee seventy (70%) percent;
(ii) The agreed upon Expenditures for purposes of calculating dilution shall
be the Optionee's initial Expenditures together with all additional
Expenditures incurred by the Optionee pursuant to the Ongoing Expenditure
Requirement until the delivery of a Feasibility Report. For purposes of
calculating dilution under the Joint Venture, the Optionor shall, at the
time the Feasibility Report is delivered by the Optionee, be deemed to
have contributed a sum that is determined by multiplying the total amount
of the Optionee's Expenditures as of that time by 30/70. After delivery
of the Feasibility Report further costs incurred on the Property shall be
borne by the Optionor and the Optionee in accordance with their respective
interests in the Property;
(iii) Terms respecting dilution as follows:
(a) If any party elects or is deemed to have elected not to contribute to a
program the amounts to be contributed by the party who elected to
contribute to that program shall be increased subject to the right of the
contributing party to elect not to contribute more than the amount
initially committed to. If a party elects not to contribute more than
the amount initially committed to, the Manager may elect not to proceed
with the program or prepare an amended program and the provisions of this
section shall apply to such amended program;
(b) If after electing to participate a party fails to pay its share within 30
days the Manager may by notice demand payment. If no payment is made
within the specified period the party shall be deemed to have elected
not to contribute the costs and the provisions of section 8.2 (b)
(iii)(c) shall apply;
(c) If a party elects or is deemed not to contribute to the costs, the
interest of that party shall be decreased and the interest of the party
contributing in excess of it's proportionate share shall be increased so
that at all times the interest of each party will be that percentage
which is equivalent to the actual and deemed Expenditures expressed as a
percentage of the Expenditures of both parties Notwithstanding the
foregoing, the party whose interest has been reduced shall be entitled
to receive details of and to contribute to future programs to the extent
of its then interest; and
(d) If the effect of the application of sections 8.2 (a) , (b) and (c)
is to reduce the interest of any party to ten (10)% or less that interest
will be converted to a five (5%) percent Net Profits Interest.
(c) Terms respecting the financing of Development as follows:
(i) The Optionor may elect, by written notice to the Optionee, to cause the
Optionee to provide or arrange for direct financing to the Optionor in
amounts sufficient to enable the Optionor to fund its proportionate share
of financing of Development. If the Optionor gives such notice, the
Optionee shall provide or arrange for financing to the Optionor in
amounts sufficient to enable the Optionor to fund it proportionate share
of Development costs. Upon the completion of such financing, the
Optionor's interest shall be reduced to 25% and the Optionee's share and
total interest shall be increased to 75%. Thereafter, for the purposes
of calculating dilution hereunder, the Optionor, shall be deemed to have
contributed a sum that is determined by multiplying the total amount of
Expenditures as of that time by 25/75.
9 OPERATOR
9.1 The Optionee shall be the Operator for the Property and shall manage the
day to day exploration activities on the Property.
9.2 The Operator shall have full right, power and authority to do everything
necessary or desirable in connection with the Mining Work, including,
without limiting the generality of the foregoing, the right, power and
authority to:
(a) regulate access to the Property subject only to the right of
representatives of Xxxxxx and the Optionor to have access to the Property
at all reasonable times for the purpose of inspecting Mining Work thereon
at their own risk and expense; and
(b) employ and engage such employees, agents and independent contractors as
it may consider necessary or advisable to carry out its duties and
obligations hereunder and in this connection to delegate any of its
powers and rights to perform its duties and obligations hereunder.
10 DUTIES AND OBLIGATIONS OF THE OPERATOR
10.1 The Optionee agrees that during the term of this Agreement it shall:
(a) carry out exploration and development work on the Property in accordance
with recognized good and workmanlike exploration and engineering
practices and in conformity in all respects with all applicable
governmental mining laws and regulations;
(b) keep the Property free of liens, including builder's liens and miner's
liens, and should any liens be filed, remove the same within thirty (30)
days of their filing;
(c) upon the termination of this Agreement, leave the Property in a safe
condition in accordance with applicable statutes and regulations,
including environmental restoration requirements;
(d) maintain the mineral rights comprising the Property in good standing;
(e) at all times maintain and keep true and correct records of all production
and disposition thereof and of all expenditures incurred, as well as all
other data necessary or proper for the settlement of accounts between the
parties hereto in connection with their rights and obligations under this
Agreement. Such records shall be open at all reasonable times upon
reasonable notice for inspection by the Optionor or his duly authorized
representative; and
(f) indemnify and hold harmless the Optionor from and against any damage,
claim or demand arising out of any failure to comply with subsection (a)
through (e) herein.
11 INDEMNITIES
11.1 In this section "Losses" shall include any loss, liability, claim,
demand, damage, expense, injury or death.
11.2 The Optionor covenants and agrees to save the Optionee harmless from
and against any Losses arising out of or in connection with the
operations or activities which were carried out on the Property by the
Optionor prior to the date of this Agreement. Without limiting the
generality of the foregoing, the Optionor covenants and agrees to
indemnify and save the Optionee harmless from Losses resulting from:
(a) any material, spill, discharge, leak, emission, ejection, escape,
dumping, or any release or threatened release of any kind, of any toxic
or hazardous substance or waste (as defined by any applicable law) from,
on, in or under the Property, or into the environment, except releases
permitted or otherwise authorized by such law;
(b) any toxic or hazardous substance or waste that has been disposed of or
is located on the Property as a result of activities of the Optionor or
its predecessors in interest; and
(c) any toxic or hazardous substance or waste that has been treated on or is
now stored on the Property.
11.3 The Optionee covenants and agrees to save the Optionor harmless from and
against any Losses arising out of or in connection with the Optionee's
operations or activities on the Property up to the formation of the Joint
Venture. Without limiting the generality of the foregoing, the Optionee
covenants and agrees to indemnify and save the Optionor harmless from
Losses resulting from:
(a) any material, spill, discharge, leak, emission, ejection, escape,
dumping, or any release or threatened release of any kind, of any toxic
or hazardous substance or waste (as defined by any applicable law) from,
on in or under the Property, or into the environment, except releases
permitted or otherwise authorized by such law;
(b) the disposal or location on the Property of any toxic or hazardous
substance or waste; and
(c) the treatment or storage on the Property of any toxic or hazardous
substance or waste.
11.4 Upon the formation of the Joint Venture, the Joint Venture shall be
solely responsible for any future operating losses or liabilities.
12 TERMINATION OF OPTION
12.1 Should the Expenditure, payment of cash consideration and required share
issuances set out in section 4.1 not be completed in full on or before
their respective due dates then the Option shall terminate and the
Optionee shall earn no interest in the Property pursuant to the terms
hereof.
12.2 The Optionee may terminate this Agreement at any time by giving written
notice of such termination to the Optionor. This Agreement shall
terminate on the date the Optionor is deemed to have received such notice
in accordance with section 16 herein. Upon such termination, this
Agreement shall be of no further force and effect, except that the
Optionee shall be required to make any payments or share issuances due
and owing at the time the notice of termination is deemed to have been
received by the Optionor, and the Optionee shall forthwith deliver all
records of Mining Work, including maps and data derived therefrom in its
possession to the Optionor.
12.3 Where either party is entitled, under any provision contained herein, to
terminate this Agreement, it shall do so by delivering notice of
termination to the other party in the manner prescribed in section 16.
Where notice of termination is given by either party:
(a) this Agreement shall terminate on the date the party is deemed to have
received notice under section 16;
(b) except as otherwise provided herein, neither party will have any further
rights or obligations hereunder;
(c) the Optionee will have earned no interest in the Property; and
(d) the Optionor will be free to make offers to other parties respecting the
Property and the interest offered herein.
12.4 If this Agreement is terminated by the Optionee, the Optionee shall take
such steps as are necessary to ensure that the Property remains in good
standing for a period of at least one year following the date of
termination.
13 ASSIGNMENT
13.1 Subject to section 9.5 of the Xxxxxx Option Agreement, any party may
assign, in whole or in part, its interest to an Affiliate or an
Associate. Except for such assignment to Affiliates or Associates,
subject to section 13.2 no party shall assign or transfer its interest
or any other interest in or under this Agreement, in whole or in part,
without the prior written consent of the other party, which consent shall
not be unreasonably withheld. In addition to a direct assignment or
transfer, the assignment or transfer of any or all of a party's interest
or other interest in or under this Agreement to an Affiliate or Associate
may be effected by way of merger, amalgamation, consolidation or
reorganization without the consent of the other party and, in either
case, the resultant interest of a party and its Affiliates or Associates
shall be aggregated and treated as one interest for the purposes of
section 8 hereof. No assignment shall operate to relieve the assignor
from any liability or obligation under this Agreement. Each assignment
shall provide that the assignee shall be bound by this Agreement.
13.2 No party may mortgage, charge or encumber all or any part of its interest
for any reason without the prior written consent of the other party.
14 CONFIDENTIALITY OF INFORMATION
14.1 No party to this agreement shall, without the express written consent of
the other parties, disclose any of the Confidential Information to any
other person or entity nor issue any press releases concerning the
Confidential Information; 14.2 Notwithstanding section 14.1, if the
Optionor contemplates selling or assigning its interest, it shall have
the right to disclose to a prospective purchaser any part of the
Confidential Information reasonably necessary to facilitate the sale or
assignment of its interest if it first obtains an agreement in writing
from the prospective purchaser, and furnishes a copy of such agreement to
the Optionee, that the prospective purchaser shall not disclose to any
person or entity any of the Confidential Information furnished to it.
14.3 Notwithstanding section 14.1, the parties shall have the right to
disclose the Confidential Information with respect to this Agreement,
in strict confidence to their attorneys or financial and mining
consultants.
14.4 Notwithstanding anything contained in section 14.1 of this Agreement,
the parties acknowledge the right and privilege of the Optionee to file,
register and/or to otherwise deposit a copy of this Agreement with any
governmental agencies in order to give third parties notice of this
Agreement, and hereby agree, each with the others, to do or cause to be
done all acts or things reasonably necessary to effect such filing,
registration or deposit.
14.5 This section does not apply to any disclosure which may be required by
law, securities regulatory bodies, or stock exchanges governing one or
more of the parties.
15 AREA OF COMMON INTEREST
15.1 During the term of this agreement, if any party or its Affiliate (the
"Acquiring Party") stakes or otherwise acquires, directly or indirectly,
any right to or interest in, or any right to receive proceeds of
production from, any mining claim, license, lease, grant, concession,
permit, patent, or other form of mineral tenure located wholly or partly
within the Area of Common Interest, the Acquiring Party shall forthwith
give notice to the other party of that staking or acquisition, the total
cost thereof and all details in the possession of the Acquiring Party
with respect to the acquisition, the nature of the property acquired and
the known mineralization.
15.2 The other party may, within 30 days of receipt of the Acquiring Party's
notice, by notice to the Acquiring Party, require that the mineral
properties and the right or interest acquired be included in and
thereafter form part of the Property for all purposes of this agreement.
The other party shall not be required to reimburse the Acquiring Party
for its proportionate share of the out of pocket costs of the acquisition
in question.
15.3 If the other party does not make the election aforesaid within the
period of 30 days, the right or interest acquired shall not form part of
the Property and the Acquiring Party shall be solely entitled thereto.
16 NOTICE
16.1 Any notice required or permitted to be given under this Agreement shall
be in writing and delivered by registered mail, facsimile transmission,
courier or by hand, in each case addressed to the intended recipient at
the address set out on the first page of this Agreement.
16.2 Any notice delivered by registered mail, courier or hand will be deemed
to have been given on the day it was received. Any notice given by
facsimile transmission will be deemed to have been given upon
confirmation by telephone of receipt.
16.3 Any party may give notice in writing of any change of its address. The
address provided in said notice will thereafter be deemed to be the
address of the party for the giving of notice hereunder.
17 ASSOCIATION OF PARTIES
17.1 Nothing contained in this Agreement shall be deemed to constitute a party
a partner, an agent or a legal representative of any other party. No act
done by any party pursuant to the provisions hereof shall operate to
create such a relationship.
18 FORCE MAJEURE
18.1 If a party is prevented from or delayed in incurring any Expenditures,
carrying out any programs or performing any of its obligations required
under this Agreement by a cause beyond its reasonable control (other than
its own lack of funds), as long as the party complies with the provisions
of this section, such delay or failure to act will not constitute a
breach of this agreement. A cause beyond a party's reasonable control
shall include, but not be limited to, acts of God, fire, floods,
explosions, civil disobedience and unrest, weather delays, labour
disputes, strikes, threats of imminent strike, lockouts or other
industrial disturbances, plant breakdowns or failure of operating
equipment, interruptions or delays in transportation, war, insurrection
or mob violence, nationalization, laws, rules and regulations or orders
or permit, licence delays of any duly constituted governmental authority
or non-availability of labour, equipment or materials (each an
"Intervening Event").
18.2 All time limits imposed by this Agreement will be extended by a period
equivalent to the period of delay resulting from an Intervening Event.
18.3 A party that claims an Intervening Event has occurred must, insofar as
possible, promptly give written notice to the other party of the
Intervening Event and the particulars thereof.
18.4 If a party has not taken all reasonable steps to prevent the occurrence
of an Intervening Event it may not rely on section 18.1. Where a party
claims that an Intervening Event has occurred it must perform its
obligations under this Agreement to the extent that it is possible and
practical to do so. Nothing herein will require such party to settle or
adjust any labour dispute or to question or to test the validity of any
law, rule, regulation or order of any duly constituted governmental
authority.
19 DEFAULT
19.1 This section does not apply where a party defaults on its obligations
under section 4.
19.2 Where a default has occurred, a Non-Defaulting Party may provide written
notice to the Defaulting Party specifying the default. If within 30 days
(or, if the default cannot reasonably be cured within 30 days, within
such period as may reasonably be required to cure the default) after the
giving of notice of default by the Non-Defaulting Party or parties, the
Defaulting Party has failed to cure the default, the Non-Defaulting Party
shall then be entitled to seek any remedy it may have on account of the
default. The Defaulting Party shall not lose any rights under this
Agreement, nor shall the Agreement or the Option, as the case may be,
terminate upon notice of the Default being given by the Non-Defaulting
Party.
20 DISPUTE RESOLUTION
20.1 Any dispute arising out of or in connection with this Agreement shall be
resolved in the following manner:
(a) the disputing party will provide the particulars of the dispute to the
non-disputing party as soon as practicable;
(b) upon the non-disputing party receiving the particulars, the non-disputing
party will have 10 business days to provide the disputing party with a
response to the particulars;
(c) upon the disputing party receiving the non-disputing party's response,
the parties will have 10 business days thereafter during which they may
attempt to resolve the dispute;
(d) if the parties are unable to resolve the dispute within 10 business days,
the dispute will be submitted by the parties to a mutually agreed upon
Expert for resolution and the parties will split equally the costs
incurred for this dispute resolution process;
(e) if the parties are unable to agree upon an Expert for the dispute within
10 business days after the end of the period referred to in subsection
(c) above or if one or both of the parties refuses to accept the decision
of the Expert, the parties will submit the dispute to arbitration as
described in subsection (f) below; and
(f) any dispute which is not resolved by the dispute resolution process as
contemplated by this section, will be submitted to binding arbitration
pursuant to the Commercial Arbitration Act (British Columbia), and the
costs of such arbitration will be paid as determined pursuant to the
arbitration.
21 GENERAL
21.1 This Agreement shall be governed by and interpreted in accordance with
the laws of British Columbia.
21.2 This Agreement embodies the entire agreement and understanding among the
parties hereto and supersedes all prior agreements and undertakings,
whether oral or written, relative to the subject matter hereof.
21.3 Time shall be of the essence of this Agreement.
21.4 The recitals set out at the beginning of this Agreement do not form part
of this Agreement.
21.5 The headings of the sections of this Agreement are for convenience only
and do not form a part of this Agreement. They are not intended to affect
the construction of anything herein contained or govern the rights and
liabilities of the parties.
21.6 Notwithstanding anything to the contrary herein contained, this Agreement
shall be subject to Exchange Acceptance and the prior receipt of any
requisite third party consents.
21.7 Upon the written request of any of the parties, the other parties agree
to furnish such additional further assurances or documents as may be
reasonably necessary to carry out the intent, purposes and terms of this
Agreement.
21.8 This Agreement shall enure to the benefit of and be binding upon the
parties hereto and their respective successors, permitted assigns, heirs,
administrators and legal representatives.
21.9 This Agreement, and all rights and obligations hereunder may be
assigned, in whole or in part, by either party hereto with the consent of
the other, not to be unreasonably withheld or denied. Any assignment of
interest under this Agreement shall be made expressly subject to this
Agreement and shall require the assignee to agree in writing to assume
all of the obligations of the assigning party as they relate to the
interest assigned. No assignment shall be effective as between the
parties until delivery to the non-assigning party of satisfactory
evidence of such assignment.
21.10 This Agreement may only be changed by an agreement in writing, duly
executed by the party or parties against which enforcement, waiver,
change, modification or discharge is sought.
21.11 If any one or more of the provisions contained herein should be held to
be invalid, unenforceable or illegal in any respect in any jurisdiction,
the validity, legality and enforceability of such provision shall not in
any way be affected or impaired thereby in any other jurisdiction and the
validity, legality and enforceability of the remaining provisions
contained herein shall not in any way be affected or impaired thereby.
21.12 Words used herein importing the singular number only shall include the
plural, and vice-versa, and words importing the masculine gender shall
include the feminine and neuter genders, and vice-versa, and words
importing persons shall include firms and corporations.
21.13 Waiver of any provisions herein by any party hereto shall not be
construed as a waiver of any other provisions or terms of this Agreement.
21.14 This Agreement may be executed in counterparts which may be delivered by
facsimile. Each executed counterpart shall be deemed to be an original
and all such counterparts when read together constitute one and the same
instrument.
IN WITNESS WHEREOF the parties hereto have executed this Agreement on the date
first above written.
RIMFIRE MINERALS CORPORATION
Per: XXXXX X. XXXXXXXXX
Authorized Signatory
STIKINE GOLD CORPORATION
Per: XXXXX XXXXXXXXX
Authorized Signatory
This agreement was prepared by Xxxxxx & Company, Barristers & Solicitors, for
Rimfire Mineral Corporation. It is recommended that other parties hereto obtain
independent legal advice with respect to the provisions contained herein.
This is SCHEDULE "A" to the Option Agreement dated December 18, 2002 between
RIMFIRE MINERALS CORPORATION and STIKINE GOLD CORPORATION.
XXXXXXXX GOLD PROPERTY
Claim Name Mineral Tenure No. of Units Record Date Expiry Date
BT 385785 20 21-Apr-01 31-Dec-04
BT 1 386612 20 16-May-01 31-Dec-04
BT 2 386613 20 16-May-01 31-Dec-04
BT 3 386614 8 17-May-01 31-Dec-04
GOS 386611 20 17-May-01 17-May-03
88
STIKINE PROPERTY
Claim Name Mineral Tenure No. of Units Record Date Expiry Date
Will 1 393892 9 June 6, 2002 June 6, 2003
Will 2 393893 9 June 6, 2002 June 6, 2003
Will 3 393894 18 June 6, 2002 June 6, 2003
Will 4 393895 18 June 6, 2002 June 6, 2003
54
This is SCHEDULE "B" to the Option Agreement dated December 18, 2002 between
RIMFIRE MINERALS CORPORATION and STIKINE GOLD CORPORATION.
NET PROFITS INTEREST
A party who is reduced to less than a 10% Interest shall be subject to the
provisions of Section 8.2(d) herein and shall, upon such event be referred to
as "Royalty Owner". Royalty Owner is entitled to a royalty equal to 5% of the
Net Profits, calculated as provided herein, attributable to all mineral
products produced and sold (or deemed sold, as set forth herein) and all other
revenue from the Property.
All capitalized words and phrases used in this Schedule shall have the meanings
assigned to them herein, as follows:
A. "Cash Flow" shall mean the extent to which, on a cumulative basis, Proceeds
exceed the sum of "Operating Costs and those certain Production Costs other
than Operating Costs".
B. "Net Profits" shall mean, on a cumulative basis, the extent to which Cash
Flow exceeds Payback.
C. "Operating Costs" shall mean and include the total of all direct costs of
operation and all general and administrative on-site and off site expense
that are paid, incurred or accrued, as a result of or in connection with
all operations and activities conducted on or for the benefit of the
Property, including but not limited to the following:
(a) Rentals, Royalties and Other Payments. The sum of all Property
acquisition, holding and maintenance costs, including filing fees,
license fees, costs of permits and assessment work, delay rentals,
production royalties owing to any third parties, any tax royalty or other
payments or obligations of any kind or character whatsoever that are
imposed by any federal, state or local government, and all other payments
made by, or expenses incurred or accrued, that are necessary or desirable
to acquire or maintain title to the Property and to construct of maintain
facilities and improvements used on or for the benefit of the Property.
(b) Labor and Employee Benefits.
(i) All salaries and wages of employees that are directly engaged in
operations on or fore the benefit of the Property, including salaries or
wages of employees who are temporarily assigned to work on or for the
benefit of the Property.
(ii) Costs of holiday, vacation, sickness and disability benefits, and other
customary allowances applicable to the salaries and wages chargeable
under paragraph (1)(b)(i) above and paragraph (1)(j) below. Such costs
may be charged on a "when and as paid basis", or by "percentage
assessment" on the applicable amount of salaries and wages. If percentage
assessment is used, the rage that is employed shall be applied to
salaries or wages only, excluding any overtime or bonus payments.
(iii) Actual cost of established plans for employees' group life insurance,
hospitalization, pension, retirement, stock purchase, thrift or bonus
plans (except, in the latter instance, production or incentive bonus
plans under a union contract based on actual rates or production, cost
savings or other production factors, and similar non-union bonus plans
customary in the industry or necessary to attract competent employees,
any and all of which bonus payments shall be considered salaries and
wages under paragraph (1)(b)(i) above or paragraph (1)(j) below, rather
than costs attributable to employee3s' benefit plans), and actual costs
of other benefit plans of a like nature applicable to salaries and wages
chargeable under said paragraphs (1)(b)(i) or (1)(j), providing that the
benefits chargeable under such plans shall be limited to those
incorporated within usual and customary plans.
(iv) The cost of any and all assessments imposed by any governmental authority
which are applicable to salaries, wages and benefits chargeable under
paragraphs (1)(b)(i), (1)(b)(ii), (1)(b)(iii), and (1)(j) hereof,
including all penalties.
(c) Improvements, Materials, Equipment and Supplies. The cost of
improvements, materials, equipment and supplies (herein called
"Material") purchased from unaffiliated third parties, or furnished and
used for operations on or for the benefit of the Property as used herein,
the cost of Material shall also include all applicable amortization or
depreciation expense allocable to such Material, and costs of financing.
(d) Transportation. Reasonable transportation costs paid, incurred or accrued
in connection with the transportation of employees and Material necessary
for operations on or for the benefit of the Property.
(e) Contract Services and Utilities. The cost of contract services and
utilities procured from outside sources, other than services described
in paragraph (1)(h) below, for the benefit of the Property. If contract
services are performed, the cost charged or accrued for such services
shall not be greater than the cost for which comparable services and
utilities are available in the open market within the vicinity of the
Property.
(f) Insurance Premiums. Net premiums paid or accrued for insurance carried
for operations on or for the benefit of the Property. In the event of
self-insurance for Worker's Compensation and/or Employer's Liability
under state law, an election may be made to include such risks in the
self-insurance program, and such costs of self-insuring such risks shall
be charged.
(g) Damage and Losses. All costs incurred or accrued in excess of insurance
proceeds, in connection with the repair or replacement of any damage or
loss, resulting from any cause, affecting any portion of the Property, or
any improvements thereon.
(h) Legal and Regulatory Expenses. All legal and regulatory costs and
expenses incurred or accrued in connection with or resulting from
operations on or for the benefit of the Property, or as may be necessary
to protect title to the Property, or to protect, replace or recover the
facilities or improvements used on or for the benefit of the Property,
and all other costs of consulting, legal, accounting, insurance and other
services in connection with the operations on the Property.
(i) Taxes. All taxes (except taxes calculated upon income) of every kind and
nature assessed or assessed or levied upon or in connection with the
Property or in connection with operations conducted on or for the benefit
of the Remaining Participants and Royalty Owner(s) shall be separately
responsible for income taxes that are attributable to their respective
interest in the Property.
(j) District and Camp Expense. The allocable portion of (i) the salaries and
expenses of superintendent and other employees serving the Property whose
time is allocated directly to the Property, and (ii) the costs of
maintaining and operating an office and any necessary sub-office for the
benefit of the Property, and (iii) all necessary camps, including housing
facilities for employees, used for the benefit of the Property.
(k) Other Expenditures. Any reasonable direct expenditures, other than
expenditures which are covered by the foregoing provisions, incurred or
accrued for the necessary and proper conduct of operations on or for the
benefit of the Property.
(l) Allocation of Costs. Any of the foregoing Operating Costs that are
incurred or accrued for the benefit of both the Property and other lands
shall be allocated on a calendar year's basis between the Property and
such other lands and such allocation shall be made in the same proportion
as the tonnage or ore that is mined from such other lands and fed to
process during that year relates to the tonnage of ore that is mined from
the Property and fed to process during such year. In the alternative, as
to capital items, the election may be made to charge to the Operating
Costs of the Property an amount equal to a market rental value for such
items, based upon the amount of use of such items on or for the benefit
of the Property.
(m) Reclamation Costs. Reclamation costs, which shall be charged if and to
the extent that such costs are actually paid, set aside, or accrued for
the Property, including reclamation bonds.
(n) Overhead Charge. An overhead charge described in section 8.2(a)(iii) of
the Option Agreement:
(i) Any and all prior excesses of Operating Costs over Proceeds; and
(ii) A reasonable sum for working capital reserves, it being understood that
such reserves shall be not less than three months worth or cumulative
Operating Costs that are paid, incurred or accrued when the Property is
in full production.
(iii) A reasonable sum of contingencies as confirmed by the Operators
auditors.
D. "Payback" shall mean the point in time at which cumulative Cash Flow has
equaled the sum of (1) all cumulative Production Costs, plus (2) interest
on all such Production Costs at a rate equal to the Prime Rate, plus 2%,
with interest to be calculated on the first business day of each calendar
quarter during which any of those Production Costs are paid, incurred or
accrued, and with such interest to begin accruing from the first day that
Royal pays, incurs or accrues any such Production Costs.
E. "Production Costs" shall mean all costs and expenses paid, (including the
aggregate of all preproduction expenditures), incurred or accrued on or for
the benefit of the Property, including but not limited to exploration,
development and mining activities, title work, environmental studies and
reports, construction and installation of mining and procession
improvements and (to the extent not included in the foregoing), all
Operating Costs.
F. "Prime Rate" means, at any time, the rate of interest per annum quoted,
published and commonly known as the "prime rate" of Canadian Imperial Bank
of Commerce ("CIBC") which CIBC establishes at its main offices in Toronto
as the reference rate of interest in order to determine interest rates for
loans in Canadian Dollars to its Canadian borrowers, adjusted automatically
with each quoted or published change in such rate, all without the necessity
of any notice to its borrowers or to any other person.
G. "Proceeds" means all sums received (or deemed to have been received)
resulting from the sale of any Products mined or produced from the
Property.
The Royalty on Net Profits shall be paid to Royalty Owner on a quarterly basis,
and Royalty Owner will be provided, along with each such payment, a summary
report describing the results of activities and operations undertaken upon the
Property during the previous quarter, along with copies of all non-interpretive
data collected from, on or about the Property during such quarter.
Royalty Owner shall have the right, at any time during the existence of this
Net Profits Production Royalty, such right to be exercised on Royalty Owner's
own behalf or through an agent, and such right to be exercised at Royalty
Owner's own cost and risk and only upon reasonable prior notice, to enter upon
the Property at all reasonable times and intervals to observe the mining,
weighing, hauling, milling, assaying, stockpiling and other operations on the
Property and to obtain ore samples for reasonable assaying purposes, and to
inspect the non-interpretive geological records, all for the purpose of
determining whether the provisions set forth herein are being observed;
provided however, any such observation and inspection shall be conducted in
such a manner so as to not unreasonably interfere with operations on the
Property. Full, true and accurate accounts showing the tonnages and all
shipments and sales of all products from the Property shall be kept, which
books, records and accounts may be inspected by Royalty Owner at his own
expense, at any reasonable time during normal business hours, and upon
reasonable prior notice.
Royalty Owner agrees to treat all information acquired hereunder as
confidential, and the parties agree that neither shall use the other's name in
any manner, without first having obtained written approval of the other party,
except as may be required by law. In the event of any anticipated disclosure
that a party believes is required by law, the disclosing party shall notify the
non-disclosing party prior to such disclosure, so that the non-disclosing party
can take appropriate action to limit or prohibit such disclosure through a
protective order or otherwise.
STIKINE GOLD CORPORATION
000-0000 Xxxx Xxxxxx
Xxxxxxxxx, XX
Xxxxxx X0X 0X0
T: 604.684.5900 x 114
F: 604.684.5909
Xxxxx 00, 0000
XXXXXXX MINERALS CORPORATION
700- 000 Xxxx Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxx Xxxxxxxx
X0X 0X0
ATTENTION: XXXXX XXXXXXXXX, PRESIDENT
Dear Sirs:
Re: Option Agreement
Further to our discussion, reference is made to the Option Agreement dated
December 18, 2002 (the Agreement") between the Rimfire Minerals Corporation
(the "Optionor") and Stikine Gold Corporation (the "Optionee"). In connection
with the Xxxx Property and the Stikine Property , collectively referred to as
the Xxxxxxxx Gold Property, various provisions of the Agreement must be
amended, as follows:
1. It is agreed that the Optionee now intends to apply for listing of its
shares on the TSX Venture Exchange (the "Exchange") prior to August 31, 2003
and the Optionor agrees to extend the deadline for such application, as
defined in the Agreement.
2. For the purposes of subsection 4.1 (b) (i), the Optionee will now issue
100,000 Shares to the Optionor by no later than the Listing Date and before
August 31, 2003.
3. For the purposes of subsection 4.2, the Optionee now agrees that in order to
earn its interest in the Property, the Listing Date must occur prior to
August 31, 2003. The Optionee now acknowledges and agrees that if the
Listing Date does not occur prior to August 31, 2003, it will not be in a
position to comply with section 4.1 (b) as amended, and the Agreement will
terminate in accordance with section 12.1.
All capitalized terms used herein and not otherwise defined shall have the same
meaning as is assigned to such terms in the Agreement. Except for the
amendments provided herein, which are hereby deemed to be merged with the
Agreement, the terms and conditions of the Agreement shall remain in full
force and effect.
If you agree with these amendments to the Agreement, please sign the enclosed
copy of this letter and return it to the attention of Xxxxx Xxxxxxx in our
office. Thank you for your attention to this matter and please do not hesitate
to contact the undersigned at your convenience.
Yours Truly,
STIKINE GOLD CORPORATION
Xxxxx X. Xxxxxxxxx, P.Eng
President and CEO
RIMFIRE MINERALS CORPORATION does hereby agree to the amendments to the
Agreement.
Dated this 28th day of March, 2003
Per: XXXXX X. XXXXXXXXX
Authorized Signing Authority
May 21, 2003
ADDENDUM TO MINING JOINT VENTURE AGREEMENT
This Addendum to Mining Joint Venture Agreement dated May 23, 2002 (this
"Addendum") is entered into by and between RIMFIRE MINERALS CORPORATION,
a British Columbia corporation ("Rimfire"), and HOMESTAKE CANADA INC. an
Ontario corporation ("Homestake").
RECITALS
A. Rimfire and Homestake have entered into that certain Mining Joint
Venture Agreement dated effective Apri1 23, 2002 ("Venture Agreement").
B. Homestake has acquired the MOR 2 claim adjoining the Properties that
are subject to the Venture Agreetnent. A description of the MOR 2 claim
("MOR 2") is provided on Exhibit 1 attached hereto and made a part hereof.
Rimfire and Homestake desire to cause the MOR 2 Claim to become subject to
the Venture Agreement in accordance with the provisions of this Addendum.
AGREEMENT
Now, therefore, in consideration of the mutual premises and covenants and
agreements contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are acknowledged, Rimfire and Homestake agree
as follows:
1. Rimfire and Homestake agree that the MOR 2 Claim shall be subject to
the Venture Agreement and be included as a Property in accordance with the
following terms:
a. Title to the MOR 2 Claim shall remain with Homestake until the
earlier to occur of (i) vesting of Homestake's undivided 75% interest in
the Properties pursuant to Section S.I(a) of the Venture Agreement, Or
(ii) prior termination of the Venture Agreement.
b. When Homestake's 75% interest vests pursuant to said Section5.1(a) of the
Venture Agreement, Homestake shall convey an undivided 25% interest in
the MOR 2 Claim to Rimfire.
c. In the event of termination of the Venture Agreement prior to the vesting
of Homestake's undivided 75% in the Properties, the provisions of Section
5.6 of the Venture Agreement shall be applicable with respect to the MOR
2 Claim and Homestake shall assign all of its title to the MOR Claim to
Rimfire in accordance with Section 5.6(b).
d. Homestake shall have no obligation to incur any Exploration Expenses with
respect to the MOR 2 Claim, but any expenses incurred by Homestake in
respect of the MOR 2 Claim that constitute Exploration Expenses shall be
credited to Homestake as Exploration Expenses under the provisions of the
Venture Agreement.
e. The Area of Interest as defined in Article I of the Venture Agreement
shall not be at'fected by inclusion of the MOR 2 Claim as a Property
under the Venture Agreement.
f. Homestake makes no representations or warranties of any kind in respect
of the MOR 2 Claim or its ownership interest therein.
2. The Venture Agreement remains in full force and effect as modified by the
provisions of this Addendum.
IN WITNESS WHEREOF, the parties hereto have executed this Addendum of the
date first above written.
HOMESTAKE CANADA INC.
By:
Title: President
Date: May 22, 2003
By:
Title: Secretary
Date: May 23, 2003
RIMFIRE MINERALS CORPORATION
By: XXXXX X. XXXXXXXXX
Title: President
Date: May 23, 2003
By: XXXXX X. XXXXXX
Title: Chairman, Director
Date: May 27, 2003
Addendum to Mining Joint Venture Agreement Between
Rimfire Minerals Corporation and
Xxxxxxx Gold Corporation
DESCRIPTION OF THE MOR 2 CLAIM
Liard Mining Division, British Columbia
NTS: 104B/1SE and 104G/2E
Latitude: 57.00 degrees; Longitude 130.67 degrees
Claim Tenure Expiry Units
MOR 2 394044 05-June-2005 12
