ECHO BAY MINES
0000 Xxxxx Xxxxxxxx Xxxxx Xxxxxx
Xxxxx 0000 X. Xxx Xxxx
Xxxxxxxxx, Xxxxxxxx 00000-4957 Manager Land U.S.
Telephone (000) 000-0000 Telephone (000) 000-0000
Telecopier (000) 000-0000 Telecopier (303) 714-8987
November 22, 1996
Xx. Xxx Xxxxxxx
President
AMERICOMM RESOURCES CORPORATION
0 Xxxx 0xx Xxxxxx, Xxxxx 000
Xxxxx, Xxxxxxxx 00000
RE: HEADS OF AGREEMENT - XXXXXX PROPERTY
XXXXXXXXX COUNTY, NEVADA
Dear Xx. Xxxxxxx:
This letter confirms the common intent of AMERICOMM RESOURCES CORPORATION
("Americomm") and ECHO BAY EXPLORATION ("Echo Bay") to enter into a mining
venture agreement by which Echo Bay may acquire from Americomm an undivided
Fifty-One Percent (51%) interest in: (i) that certain Mining Lease Agreement
between Xxxxxxxxx xxx Xxxxxxx and Southwestern Gold U.S.A., Inc., dated
June 15, 1991, which Mining Lease Agreement was assigned to Americomm pursuant
to that certain Assignment and Assumption between Southwestern Gold U.S.A.,
Inc. and Americomm, dated May 19, 1995 (the "xxx Xxxxxxx Lease"), concerning
ninety-one (91) unpatented lode mining claims located in Xxxxxxxxx County,
Nevada (the "xxx Xxxxxxx Claims"), which xxx Xxxxxxx Lease is attached hereto
as Exhibit "A", (ii) that certain Mining Lease Agreement between Xxxxxx X.
Xxxxxxxx and Southwestern Gold. U.S.A., Inc., dated July 15, 1992, which
Mining Lease Agreement was assigned to Americomm pursuant to that certain
Assignment and Assumption between Southwestern Gold U.S.A., Inc. and
Americomm, dated May 19,1995 (the "Xxxxxxxx Lease"), concerning three (3)
unpatented lode mining claims located in Xxxxxxxxx County, Nevada (the
"Xxxxxxxx Claims"), which Xxxxxxxx Lease is attached hereto as Exhibit "B";
and, (iii) thirty-six (36) unpatented lode mining claims located in Xxxxxxxxx
County, Nevada owned by Americomm (the "Americomm Claims"), a description of
which Americomm Claims is attached hereto as Exhibit "C".
The mining venture to be entered into by Echo Bay and Americomm shall be
named the Xxxxxx Mining Venture (the "Venture"). Pursuant to mutual
agreement between Echo Bay and Americomm, the Venture will incorporate the
terms set forth in this Heads of Agreement into Form 5, Mining Venture
Agreement, published by the Rocky Mountain Mineral Law Foundation, including
its Exhibit B, Accounting Procedure, and Exhibit C, Tax Matters ("Form 5").
The Form 5 may be modified, as published, only by mutual agreement of Echo
Bay and Americomm and will most closely approximate the terms and conditions
set forth in this Heads of Agreement. Americomm and Echo Bay agree that the
following, although not inclusive, represents the salient provisions that set
forth the principal terms and conditions which will be incorporated into the
Xxxxxx Mining Venture Agreement ("Venture Agreement").
1. MINING VENTURE PROPERTY. The property subject to the Venture shall
include all unpatented claims described as the xxx Xxxxxxx Claims, the
Xxxxxxxx Claims, and the Americomm Claims ("Venture Property").
2. EFFECTIVE DATE. The Effective Date of this Heads of Agreement shall
be December 1, 1996 ("Effective Date").
3. TERM. The Term of this Heads of Agreement and the proposed Venture
Agreement shall be for twenty (20) years, and so long thereafter as operations
or activities under the Venture Agreement continue, or until the Venture
Agreement is terminated, which ever occurs first.
4. REPRESENTATIONS. To the best of its knowledge, Americomm represents as
follows:
4.1 Americomm holds certain rights, including, but not limited to, the
right to explore for, extract or produce minerals from the Venture
Property;
4.2 Americomm is the owner of the Americomm Claims, subject only to the
paramount title of the United States; the Americomm Claims'
location notices and certificates have been properly recorded and
filed; all assessment work required to hold the unpatented claims
comprising the Venture Property have been properly performed,
deferred or excused through the assessment year ending September 1,
1996; and, all filings required to maintain the unpatented claims
comprising the Venture Property in good standing through December
30, 1995, including evidence of assessment work, or the equivalent
thereof, have been made;
4.3 Americomm can freely assign the xxx Xxxxxxx Lease and the Xxxxxxxx
Lease to Echo Bay.
4.4 The Venture Property is free and clear of all liens and
encumbrance except those which are specifically set forth in the
xxx Xxxxxxx Lease and the Xxxxxxxx Lease, if any;
4.5 The xxx Xxxxxxx Lease and the Xxxxxxxx Lease are in good standing;
all of Americomm's obligations thereunder which have accrued have
been met or performed;
4.6 Americomm has not received any notice regarding, and has no
knowledge of, any default or any violation of any term contained
in the xxx Xxxxxxx Lease or the Xxxxxxxx Lease;
4.7 Americomm has complied with all governmental regulations concerning
its activities on the Venture Property, including, but not limited
to, regulations enacted for the protection of the environment; and,
4.8 Americomm agrees that execution of this Heads of Agreement gives
Echo Bay sufficient authority to enter onto the Venture Property
to begin exploration activities.
5. RIGHT TO EARN INTEREST. Americomm hereby grants to Echo Bay the right
to earn and undivided Fifty-One Percent (51%) interest in the xxx Xxxxxxx
Lease, the Xxxxxxxx Lease, and the Americomm Claims by expending certain sums
money in the manner and within the time period described herein.
6. INITIAL EXPLORATION PHASE: WORK EXPENDITURES: CASH PAYMENTS. At
anytime during the first five (5) years of the Term (the "Initial Exploration
Phase"), Echo Bay shall be entitled to acquire an undivided Fifty-One Percent
(51%) interest in the xxx Xxxxxxx Lease, the Xxxxxxxx Xxxxx, and the
Americomm Claims by (i) expending Two Million Dollars ($2,000,000.00) on or
for the direct benefit of the Venture Property ("Work Expenditures"); and,
(ii) making Cash Payments to Americomm totaling Seven Hundred Fifty Thousand
Dollars ($750,000.00).
6.1 Required Work Expenditures. The Work Expenditures shall be made
annually ("Work Year") and in accordance with the following schedule:
WORK YEAR ANNUAL REQUIRED CUMULATIVE WORK
WORK EXPENDITURES EXPENDITURES
Year 1 $250,000.00 $250,000.00
Year 2 $300,000.00 $550,000.00
Year 3 $400,000.00 $950,000.00
Year 4 $500,000.00 $1,450,000.00
Year 5 $550,000.00 $2,000,000.00
Total Work Expenditures $2,000,000.00
All Work Expenditures are cumulative. If Echo Bay expends more than the
required amount in any year, then all excess monies shall be credited towards
subsequent required Work Expenditures. Echo Bay may, at it sole option,
elect to accelerate the Work Expenditures and expend the total required
Work Expenditures in less than the five (5) year time period specified
herein. Echo Bay shall not be penalized in any way if it makes such election.
Beginning with the first Work Year, which commences on the Effective Date,
and annually thereafter so long as Work Expenditures are required to be made,
the Work Expenditures will include a minimum of One Hundred Fifty Thousand
Dollars ($150,000.00) in drilling and assay expenses. Also included in the
annual Work Expenditures will be a minimum of Sixty Thousand Dollars
($60,000.00) in drilling and assay expenses to test the Shallow Resource.
The "Shallow Resource" is defined as the area of potential mineralization
that was delineated by previous drilling. The Shallow Resource will be
limited to an area that is within four hundred (400') feet of the surface. If,
in the determination of Americomm and Echo Bay, all reasonable efforts to
test the Shallow Resource have been made, then the requirement to make annual
expenditures to test the Shallow Resource shall be deleted from the annual
Work Requirement.
As part of the first years required Work Expenditure, Echo Bay agrees to
erect barriers that, in Echo Bay's sole determination, will reasonably prevent
entrance to existing mine shafts and adits on the Venture Property. The cost
of such preventative work shall be credited agains the required Work
Expenditures.
In the event that Echo Bay does not expend the total amount of an annual Work
Expenditure specified above, but it does expend at least eighty percent (80%)
of the annual Work Expenditure, then Echo Bay may, at its sole discretion,
elect to pay to Americomm a cash payment equaling the difference between the
annual required Work Expenditure and the amount actually expended by Echo Bay.
However, this cash payment shall not be more than twenty percent (20%) of the
required annual Work Expenditure. For example; Echo Bay expends Two Hundred
Forty Thousand Dollars ($240,000.00) by the end of the first Work Year. To
keep the Venture Agreement in effect, Echo Bay would then make a cash payment
to Americomm of Ten Thousand Dollars ($10,000.00). This amount represents the
difference between the required annual Work Expenditure and the amount actually
expended by Echo Bay.
Regardless of the execution date of the Venture Agreement, all exploration
expenditures, including any underlying obligation expenditures, made by Echo
Bay before and after the Effective Date of this Heads of Agreement, shall be
included in and are a credit upon the Work Expenditures. In order for
exploration expenditures to be included in the Work Expenditures, such
expenditures must come within the scope of "Charges to the Joint Account" as
set forth in Form 5, Exhibit B, Accounting Procedures, Article II. Echo Bay
shall provide Americomm with an annual accounting of Work Expenditures within
thirty (30) days of the close of each exploration work year.
If Echo Bay is precluded from timely completion of any, or all, of the Work
Expenditures set forth above due to the action or inaction of any governmental
agency to grant approval or permits to conduct exploration or development
activities, then the time period for all of the Work Expenditures shall be
extended for a period of time equal to that of the delay(s).
In the event that Echo Bay exercises its option to acquire an additional
interest in the Venture Property pursuant to Section 7 ("Option"), then Echo
Bay shall be allowed to credit expenditures made by Echo Bay in excess of the
Two Million Dollars ($2,000,000.00) Total Work Expenditures to adopted
Programs and Budgets, provided that such credited amount is limited to a
total of Fifty-Five Thousand Dollars ($55,000.00).
6.2 Cash Payments. The Cash Payments shall be made in accordance with the
following schedule:
Cash Payment Due Date
$50,000.00 The Effective Date
$100,000.00 First Anniversary of the Effective Date
$150,000.00 Second Anniversary of the Effective Date
$200,000.00 Third Anniversary of the Effective Date
$250,000.00 Fourth Anniversary of the Effective Date
Total Cash Payments $750,000.00
Echo Bay may, at its sole option, elect to accelerate the Cash Payments and
pay the Total Cash Payments to Americomm in less than the five (5) year time
period specified herein. Echo Bay shall not be penalized in any way if it
makes such election.
7. ACQUIRED INTEREST. Upon completion of the Work Expenditures and payment
of the Cash Payments, Echo Bay shall have earned an undivided Fifty-One (51%)
interest in and to the xxx Xxxxxxx Lease, the Xxxxxxxx Lease, and the
Americomm Claims. If Echo Bay fails to complete the Work Expenditures or fails
to make the Cash Payments within the time and manner prescribed above, it
shall have earned no interest in the Venture Property and the Venture Agreement
shall terminate automatically. Within one (1) year after Echo Bay has earned
its undivided Fifty-One Percent (51%) interest in the Venture Property, Echo
Bay shall have an Option to acquire an additional Nineteen Percent (19%)
undivided interest in the Venture Property by making a cash payment to
Americomm of Two Million Dollars ($2,000,000.00).
8. INITIAL PARTICIPATING INTERESTS AND DEEMED EXPENDITURES. Conditioned
upon completion of the Work Expenditures and making the Cash Payments by Echo
Bay, the Initial Participating interest of the parties and value associated
with said interests shall be:
Interest Value
Echo Bay: Fifty-One Percent (51%) US$2,750,000.00
Americomm: Forty-Nine Percent (49%) US$2,642,156.00
9. OPERATOR; PROGRAMS AND BUDGETS.
9.1 Operator. Echo Bay is hereby appointed Operator of the Venture under
this Heads of Agreement and the Venture Agreement.
9.2 Programs and Budgets. During the Initial Exploration Phase, all work
programs and budgets shall be at the sole discretion of Echo Bay. Upon Echo
Bay earning its interest in the Venture Property, all further exploration,
development and operational activities shall be conducted, expenses shall be
incurred, and assets shall be acquired, only pursuant to adopted Programs and
Budgets. Proposed Programs and Budgets shall be prepared by the Operator for
one (1) month or any longer period of time. Each adopted Program and Budget,
regardless of length, shall be reviewed at least once a year by the
Management Committee. At least forty-five (45) days prior to the expiration
of each adopted Program and Budget, the Operator shall prepare and submit
to the Participants a proposed Program and Budget for the succeeding period.
Each such proposed Program and Budget shall be in a form and degree of detail
sufficient to allow the non-Operator to make a reasonably informed
determination concerning participation therein.
9.3 Review and Approval of Proposed Programs and Budgets. Within fifteen
(15) days after submission of an exploration Program and Budget, or within
forty-five (45) days after submission of a proposed Program and Budget
involving development or mining, each participant shall submit to the
Management Committee: (a) a notice that the participant approves the proposed
Program and Budget; or (b) proposed modifications of the proposed Program
and Budget. Failure by a participant to give either of the foregoing
responses within the allotted time shall be deemed to be an approval by the
participants of the Operator's proposed Program and Budget. If a participant
makes a timely submission to the Management Committee of item 9.3(b) above,
the Management Committee shall seek, for a period of fifteen (15) days in the
case of an exploration Program and Budget and for a period of thirty (30)
days in the case of a Program and Budget involving development or mining, to
develop a Program and Budget acceptable to the participants. At the end of
such period, the Management Committee shall vote on any revised Program and
Budget developed pursuant to the preceding sentence or, failing agreement by
the participants on a revised Program and Budget, shall vote on the original
Program and Budget submitted by the Operator.
9.4 Election to Participate. By notice to the Management Committee within
twenty (20) days after the final vote adopting a Program and Budget, a
participant may elect to contribute to such Program and Budget in some lesser
amount than its respective Participating Interest, or not at all, in which
case its Participating Interest shall be recalculated as provided. If a
participant fails to notify the Management Committee, the participant shall
be deemed to have elected to contribute to such Program and Budget in
proportion to its Participating Interest as of the beginning of the period
covered by the Program and Budget. Notwithstanding the elections provided,
the Operator may implement any program and Budget adopted by vote of the
Management Committee immediately upon its effective date.
9.5 Budget Overruns; Program Changes. The Operator shall immediately
notify the Management Committee of any material departure from an adopted
Program and Budget. If the Operator exceeds an adopted Budget by more than
ten percent (10%), the excess over ten percent (10%) shall be for the sole
account of the Operator and such excess shall not be included in the
calculations of the Participating Interests, unless such excess is directly
caused by an emergency or unexpected expenditure or is authorized by the
participants. Budget overruns of ten percent (10%) or less shall be borne by
the participants in proportion to their respective Participating Interests as
of the time the overrun occurs.
10. DILUTION OF INTEREST.
10.1 If a participant elects to contribute funds to an adopted Program and
Budget in some lesser amount than its proportional Participating Interest,
or not at all, then the Participating Interest of the diluting participant
shall be recalculated at the time of the election by dividing: (i) the sum
of (a) the Initial Contribution of the diluting participant, (b) all
contributions of the diluting participant subsequent to its deemed Initial
Contribution, and (c) the amount, if any, the diluting participant elects
to contribute to the current adopted Program and Budget; by (ii) the sum of
(a),(b) and (c) above for all participants; and then multiplying the results
by one hundred. The Participating Interest of the other participant shall
thereupon become the difference between one hundred percent (100%) and the
recalculated Participating Interest of the diluting participant.
10.2 If a participant defaults in making a contribution or cash call
required by an approved Program and Budget, the non-defaulting participant
may advance the defaulted contribution on behalf of the defaulting participant
and treat the same, together with any accrued interest, as a demand loan
bearing interest from the date of the advance at LIBOR plus two percent (2%).
The failure to repay the loan upon demand shall be a default. Each
participant grants to the other a lien upon its interest in the Venture and
a security interest in its rights under the Venture Agreement.
10.3 At such time that a participant's Participating Interest dilutes to
fifteen percent (15%) or less, then the diluting participant's interest shall
be converted to a One Percent (1%) Net Returns Production Royalty from
production occuring from the xxx Xxxxxxx Claims and the Xxxxxxxx Claims, and
a Three Percent (3%) Net Returns Production Royalty from production occuring
from the Americomm Claims.
11. UNDERLYING OBLIGATIONS. Echo Bay agrees to pay, on or before August 31
each year that this Heads of Agreement or the Venture Agreement is in full
force and effect, the federal claim rental fees due for the unpatented claims
comprising the Venture Property. Echo Bay may, with the consent of Americomm,
abandon all or a portion of Americomm Claims. As of the Effective Date, and
during the Initial Exploration Phase, unless the Venture Agreement is
terminated on or before thirty (30) days prior to the due date of any
payment or obligation required pursuant to the xxx Xxxxxxx Lease and the
Xxxxxxxx Lease, or on or before thirty (30) days prior to the end of any
assessment work year, Echo Bay shall make all payments and complete all
obligations required by the xxx Xxxxxxx Lease and the Xxxxxxxx Lease, and
perform assessment work and make necessary filings required to maintain the
unpatented claims comprising the Venture Property. Echo Bay shall make the
required payments directly to Xxxxxxxxx xxx Xxxxxxx and Xxxxxx X. Xxxxxxxx,
on or before fifteen (15) days prior to the due date with a copy of such
payment provided to Americomm. In addition, Echo Bay shall have the right,
subject to Americomm's approval, to renegotiate the xxx Xxxxxxx Lease and
the Xxxxxxxx Lease.
12. AREA OF MUTUAL INTEREST. The Venture shall only apply to the Venture
Property specified herein and any property situated within the exterior
perimeter of the Venture Property hereinafter acquired by either Echo Bay or
Americomm. Neither Americomm or Echo Bay shall have any obligations to
contribute any additional properties to the Venture other than those
properties specified herein.
13. MANAGEMENT COMMITTEE. The Management Committee for the Venture shall
consist of four (4) members, two (2) which shall be appointed by each
participant. All significant decisions including, but not limited to those
affecting Programs and Budgets, shall be by the affirmative vote of a majority
(greater than 50%) of the Participating Interests. Management Committee
meetings shall be held at least two times per year at a mutually agreeable
location.
14. LIABILITY; RECLAMATION; INSURANCE. Echo Bay hereby indemnifies
Americomm against any liability arising from personal injury, death or
property damage when such is caused by Echo Bay's actions on the Venture
Property during the Initial Exploration Phase, provided that nothing herein
shall relieve Americomm from liability for its own negligence or for the
negligence of persons or instrumentalities acting on its behalf.
Should the Venture Agreement terminate prior to Echo Bay acquiring any
interest in the Venture Property, Echo Bay shall reclaim the Venture Property
in accordance with applicable law when such is required as a direct result
of Echo Bay's activities on the Venture Property and Echo Bay shall hold
Americomm harmless from any such reclamation obligations. By entering into
this Heads of Agreement, Echo Bay expressly disclaims any responsibility for
any historic or current environmental liabilities that may attach to the
Venture Property. Echo Bay's responsibility for reclamation or acceptance of
environmental/permitting liabilities on the Venture Property shall be limited
during the term of the Initial Exploration Phase specifically to any
disturbance that may be caused by Echo Bay's own activities on the Venture
Property and liability for reclamation of any disturbances existing on the
Venture Property prior to the Effective Date shall be the exclusive
responsibility of Americomm and Americomm hereby agrees to indemnify and hold
Echo Bay harmless from and against such liability. In the event that Echo
Bay earns an undivided interest in the Venture Property, then the reclamation
liability for all disturbances on the Venture Property shall be jointly as
between the parties.
Echo Bay shall not create or suffer any liens or encumbrances on the Venture
Property that may arrise out of work conducted by or on behalf of Echo Bay
during the Initial Exploration Phase.
During the Term hereof, Echo Bay agrees to comply with all applicable state
and federal laws and regulations regarding insurance for persons working in
or on the Venture Property under the direct supervision of Echo Bay. Echo
Bay agrees to carry liability insurance with respect to its operations on the
Venture Property in reasonable amounts in accordance with acceptable industry
practices in Xxxxxxxxx County, Nevada.
15. RIGHT OF FIRST REFUSAL.
15.1 If either participant (then the "Offeror") elects to sell or otherwise
transfer all or any part of its interest in the Venture, the other participant
(then the "Offeree") will have the Right of First Refusal to acquire all or
part of the interest being transferred on the same terms and conditions as a
bonafide offer made by an arms length third party. Such right shall be
effective for a thirty (30) day period following notification by the
transferring participant. If any portion of the consideration to be received
is in the form of real property or other assets, an undertaking to act or
refrain from acting, or in some other nonmonetary form, the notice from the
Offeror to the Offeree will describe such consideration and its monetary
value, based on the fair market value of any such nonmonetary consideration.
15.2 If the Offeree does not accept the whole of the offer, the Offeror shall
be entitled, within thirty (30) days after such non-acceptance, to sell or
transfer that part which was not accepted to a bonafide third party, but at
not less than the equivalent price and on conditions which are not more
favorable to such third party than those at which the Offeree was entitled to
acquire the interest.
16. ASSIGNMENT OF INTERESTS. The interests of the participants in the
Venture may not be assigned without the prior written consent of the other
participant, which consent will not be unreasonalby withheld, excepting, the
participants may freely assign it rights in the Venture to an affiliate,
subsidiary or partner.
17. TERMINATION. Upon written notice to Americomm, prior to Echo Bay
acquiring an interest in the Venture Property, Echo Bay shall have the right
to terminate the Venture Agreement at any time. Upon such termination, Echo
Bay shall be relieved of any further rights or obligations, except for those
rights and obligations which accrued prior to Echo Bay's termination. Within
ninety (90) days after termination of the Venture Agreement, Echo Bay will
provide to Americomm copies of all non-interpretative data developed by or
for Echo Bay related to the Venture Property not previously provided to
Americomm. Such data shall include, but not necessary limited to, drill logs,
assay reports, geophysical, geochemical and geologic maps, metallurgical
reports and engineering reports and studies.
18. CONFIDENTIALITY. Americomm and Echo Bay agree that the terms and
provisions of this Heads of Agreement and the Venture Agreement are highly
confidential and proprietary to each of them. Accordingly, and regardless
of whether Americomm and Echo Bay actually execute a Venture Agreement in
the manner contemplated by this correspondence, Americomm and Echo Bay agree
with each other they will not disclose, publish nor inform any third party of
the terms, conditions or monetary amounts stated herein unless the consent
of the other party is obtained in advance, which consent shall not be
unreasonably withheld or delayed. Each party shall consult with and obtain
the written consent of the other party prior to making or issuing any public
announcements, press release, or similar publicity or disclosure with respect
to this Heads of Agreement, the Venture Agreement, or any other agreement
between the parties. However, such consents shall not be required if any
disclosure is required by law, rule, regulation or ordinance as determined by
counsel for the disclosing party, but in all cases the disclosing party
shall give the other party a reasonable time within which to offer comments
on that which is disclosed or otherwise published.
19. REPORTS; ACCESS TO VENTURE PROPERTY. During the Initial Exploration
Phase, Echo Bay will provide to Americomm, on a quarterly basis, a narrative
report, together with copies of all factual data gathered by Echo Bay on the
Venture Property during the preceding calender quarter. Americomm will have
access to the Venture Property at all times.
20. NOTICES. All notices, payments, reports, consents and other
communications between the parties shall be in writing to the parties at their
respective addresses as follows:
Americomm: AMERICOMM RESOURCES CORPORATION
0 Xxxx 0xx Xxxxxx, Xxxxx 000
Xxxxx, Xxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxx
Echo Bay: ECHO BAY EXPLORATION INC.
0000 Xxxxx Xxxxxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxx 00000
Attn: Land Department
This Heads of Agreement is subject to final approval of Americomm and Echo
Bay's Board of Directors and is not binding until executed by an authorized
officer of Americomm and Echo Bay. This Heads of Agreement is further subject
to and is conditional upon on a review by Echo Bay of the title to the Venture
Property, and a determination of Echo Bay's potential liability on the Venture
Property with respect to the Comprehensive Environmental Response Compensation
Liability Act of 1980, as amended ("CERCLA") and the Resources Conservation
and Recovery Act of 1980, as amended ("RCRA").
Upon execution, this Heads of Agreement consitutes a binding agreement
between the parties and a mutual commitment by both parties to negotiate
expeditiously and in good faith towards the execution of the Venture
Agreement. This Heads of Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all of
which shall constitute the same Heads of Agreement.
If this Heads of Agreement accurately reflects our understanding, please
signify your concurrence by fully executing both copies of this Heads of
Agreement and returning both copies to me for Echo Bay's execution. Please
contact me at the above address and telephone number at your earliest
convenience if you have comments or questions regarding this proposal. I
look forward to hearing from you in the near future.
Respectfully
ECHO BAY EXPLORATION INC.
X. Xxx Xxxx
X. XXX XXXX, Land Manager U.S.
This confirms that the foregoing accurately reflects our understanding and
intent.
AMERICOMM RESOURCES CORPORATION
BY: Xxxxxx X. Xxxxxxx DATED: 12/5/96
XXXXXX X. XXXXXXX
President
ECHO BAY EXPLORATION INC.
BY: Xxxxxx X. Xxxxx DATED: 12/3/96
XXXXXX X. XXXXX
Vice President, Exploration
