OPTION AGREEMENT
THIS AGREEMENT is dated for reference the 28th day of June, 2002.
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BETWEEN:
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DIAMANT RESOURCES LTD.
a British Columbia company with an address at
0000 Xxxx Xxxxxxxx Xxxxxx, #0000, Xxxxxxxxx, X.X.
(the "Optionor") OF THE FIRST PART
AND:
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XXXX.XXX
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a Nevada corporation with its registered address at
0000 Xxxxx XxXxxx, Xxxxx 0000, Xxx Xxxxx, Xxxxxx.
("VIPC") OF SECOND PART
WHEREAS:
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A. The Optionor is the owner of an undivided 100% right, title interest in and
to certain Mining Claims more particularly described on (Schedule "A") attached
to this Agreement;
B. VIPC wishes to acquire the option to acquire a 50% interest in the
Optionor's property on the terms and subject to the conditions contained in this
Agreement;
NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the premises and
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the mutual covenants and agreements hereinafter contained, the parties hereto
agree as follows:
1. DEFINITIONS
1.1 In this Agreement, the following terms will have the meaning set forth
below:
(A) "Exploration and Development" means any and all activities comprising or
undertaken in connection with the exploration and development of the Property,
the construction of a mine and mining facilities on or in proximity to the
Property and placing the Property into commercial production;
(B) "Property" means and includes:
(i) the mining claims in the Fort St. Xxxx region of the listed in Schedule A
to this Agreement; and
(ii) all rights and appurtenances pertaining to the mining claims listed in
Schedule A, including all water and water rights, rights of way, and easements,
both recorded and unrecorded, to which the Optionor is entitled;
(C) "Property Expenditures" means all reasonable and necessary monies
expended on or in connection with Exploration and Development as determined in
accordance with generally accepted accounting principles including, without
limiting the generality of the foregoing:
(i) the cost of entering upon, surveying, prospecting and drilling on the
Property;
(ii) the cost of any geophysical, geochemical and geological reports or
surveys relating to the Property;
(iii) all filing and other fees and charges necessary or advisable to keep the
Property in good standing with any regulatory authorities having jurisdiction;
(iv) all rentals, royalties, taxes (exclusive of all income taxes and mining
taxes based on income and which are or may be assessed against any of the
parties hereto) and any assessments whatsoever, whether the same constitute
charges on the Property or arise as a result of the operation thereon;
(v) the cost, including rent and finance charges, of all buildings,
machinery, tools, appliances and equipment and related capital items that may be
erected, installed and used from time to time in connection with Exploration and
Development;
(vi) the cost of construction and maintenance of camps required for
Exploration and Development;
(vii) the cost of transporting persons, supplies, machinery and equipment in
connection with Exploration and Development;
(viii) all wages and salaries of persons engaged in Exploration and Development
and any assessments or levies made under the authority of any regulatory body
having jurisdiction with respect to such persons or supplying food, lodging and
other reasonable needs for such persons;
(ix) all costs of consulting and other engineering services including report
preparation;
(x) the cost of compliance with all statutes, orders and regulations
respecting environmental reclamation, restoration and other like work required
as a result of conducting Exploration and Development; and
(xi) all costs of searching for, digging, working, sampling, transporting,
mining and procuring diamonds, other minerals, ores, and metals from and out of
the Property;
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2.1 The Optionor hereby grants to VIPC the exclusive right and option to
acquire an undivided 50% right, title and interest in and to the Property (the
"Option") for total consideration consisting of cash payments to the Optionor
totalling Cdn. $10,000.00 provided VIPC will pay for the incurrence of Property
Expenditures to be made as follows:
(A) on the 30th day of June 2002 the payment to the Optionor of the sum of
Cdn.$5,000.00;
(B) on the 30th day of July 2003, the payment to the Optionor of the sum of
Cdn. $5,000.00;
(C) by July, 25th 2002, the incurrence of Property Expenditures will be borne
by VIPC;
VIPC will prepare and expend for a geological report on the Property (the
"Geological Report"). If the Geological Report is acceptable to VIPC, then VIPC
will negotiate with the Optionor to purchase the Mineral Claims outright. If the
Geological Report is not acceptable to VIPC, then VIPC will give notice of
termination of this Agreement to the Optionor.
2.2 Upon making the cash payments and performing the Property Expenditures as
specified in Paragraph 2.1, VIPC shall have acquired an undivided 50% right,
title and interest in and to the Property.
2.3 This Agreement is an option only and the doing of any act or the making
of any payment by VIPC shall not obligate VIPC to do any further acts or make
any further payments.
3. TRANSFER OF TITLE
3.1 Upon execution of this Agreement, VIPC shall be entitled to record this
Agreement against title to the Property.
3.2 Upon making the cash payments and performing the Property Expenditures as
specified in Paragraph 2.1, the Optionor shall deliver to VIPC a duly executed
xxxx of sale or quit claim deed and such other executed documents of transfer as
required, in the opinion of VIPC's lawyers, for the transfer of an undivided 50%
interest in the Property to VIPC.
4. JOINT VENTURE
4.1 Upon VIPC acquiring an interest in the Property pursuant to paragraph
2.1, the Optionor and VIPC agree to join and participate in a single purpose
joint venture (the "Joint Venture") for the purpose of further exploring and
developing and, if economically and politically feasible, constructing and
operating a mine on the Property. The Joint Venture shall be a fair and amicable
agreement between the parties.
5. RIGHT OF ENTRY
5.1 During the currency of this Agreement, VIPC, its servants, agents and
workmen and any persons duly authorised by VIPC, shall have the right of access
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to and from and to enter upon and take possession of and prospect, explore and
develop the Property in such manner as VIPC in its sole discretion may deem
advisable for the purpose of incurring Property Expenditures as contemplated by
Section 2, and shall have the right to remove and ship therefrom ores, minerals,
metals, or other products recovered in any manner therefrom.
6. COVENANTS OF VIPC
6.1 VIPC covenants and agrees that:
(A) during the term of this Agreement, VIPC shall keep the Property clear of
all liens, encumbrances and other charges and shall keep the Optionor
indemnified in respect thereof;
(B) VIPC shall carry on all operations on the Property in a good and
workmanlike manner and in compliance with all applicable governmental
regulations and restrictions including but not limited to the posting of any
reclamation bonds as may be required by any governmental regulations or
regulatory authorities;
(C) during the term of the option herein, VIPC shall pay or cause to be paid
any rates, taxes, duties, royalties, workers' compensation or other assessments
or fees levied with respect to its operations thereon and in particular VIPC
shall pay the yearly claim maintenance payments necessary to maintain the claims
in good standing for the term of the option;
(D) VIPC shall maintain books of account in respect of its expenditures and
operations on the Property and, upon reasonable notice, shall make such books
available for inspection by representatives of the Optionor, if so requested;
(E) VIPC shall allow any duly authorised agent or representative of the
Optionor, to inspect the Property at reasonable times and intervals and upon
reasonable notice given to VIPC, provided however, that it is agreed and
understood that any such agent or representative shall be at his own risk in
respect of, and VIPC shall not be liable for, any injury incurred while on the
Property, howsoever caused;
(F) VIPC shall allow the Optionor access at reasonable times to all maps,
reports, sample results and other technical data prepared or obtained by VIPC in
connection with its operations on the Property;
(G) VIPC shall indemnify and save the Optionor harmless of and from any and
all costs, claims, loss and damages whatsoever incidental to or arising out of
any work or operations carried out by or on behalf of VIPC on the Property,
including any liability of an environmental nature.
7. REPRESENTATIONS AND WARRANTIES
7.1 The Optionor hereby represents and warrants that:
(A) the Property is in good standing with all regulatory authorities having
jurisdictions and all required claim maintenance payments have been made;
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(B) it has not done anything whereby the mineral claims comprising the
Property may be in any way encumbered;
(C) it has full corporate power and authority to enter into this Agreement
and the entering into of this Agreement does not conflict with any applicable
laws or with its charter documents or any contract or other commitment to which
it is party; and
(D) the execution of this Agreement and the performance of its terms have
been duly authorised by all necessary corporate actions including the resolution
of its Board of Directors.
7.2 VIPC hereby represents and warrants that:
(A) it has full corporate power and authority to enter into this Agreement
and the entering into of this Agreement does not conflict with any applicable
laws or with its charter documents or any contract or other commitment to which
it is party; and
(B) the execution of this Agreement and the performance of its terms have
been duly authorised by all necessary corporate actions including the resolution
of its Board of Directors.
8. ASSIGNMENT
8.1 With the consent of the other party, which consent shall not be
unreasonably withheld, VIPC and the Optionor has the right to assign all or any
part of its interest in this Agreement and or in the Property, subject to the
terms and conditions of this Agreement. It shall be a condition precedent to any
such assignment that the assignee of the interest being transferred agrees to be
bound by the terms of this Agreement, insofar as they are applicable.
9. CONFIDENTIALITY OF INFORMATION
9.1 Each of VIPC and the Optionor shall treat all data, reports, records and
other information of any nature whatsoever relating to this Agreement and the
Property as confidential, except where such information must be disclosed for
public disclosure requirements of a public company.
10. TERMINATION
10.1 Until such time as VIPC has acquired an undivided 50% interest in the
Property pursuant to Section 2, this Agreement shall terminate upon any of the
following events:
(A) upon the failure of VIPC to make a payment or incur Property Expenditures
required by and within the time limits prescribed by Paragraph 2.1;
(B) in the event that VIPC, not being at the time in default under any
provision of this Agreement, gives 30 day's written notice to the Optionor of
the termination of this Agreement;
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(C) in the event that VIPC shall fail to comply with any of its obligations
hereunder, other than the obligations contained in Paragraph 2.1, and subject to
Paragraph 11.1, and within 30 days of receipt by VIPC of written notice from the
Optionor of such default, VIPC has not:
(i) cured such default, or commenced proceedings to cure such default and
prosecuted same to completion without undue delay; or
(ii) given the Optionor notice that it denies that such default has occurred.
(D) delivery of notice of termination by VIPC pursuant to Paragraph 2.1 in
the event the Geological Report is not acceptable;
In the event that VIPC gives notice that it denies that a default has occurred,
VIPC shall not be deemed in default until the matter shall have been determined
finally through such means of dispute resolution as such matter has been
subjected to by either party.
10.2 Upon termination of this Agreement under Paragraph 10.1, VIPC shall:
(A) transfer any interest in title to the Property, in good standing to the
Optionor free and clear of all liens, charges, and encumbrances;
(B) turn over to the Optionor copies of all maps, reports, sample results,
contracts and other data and documentation in the possession of VIPC or, to the
extent within VIPC's control, in the possession of its agents, employees or
independent contractors, in connection with its operations on the Property; and
(C) ensure that the Property is in a safe condition and complies with all
environmental and safety standards imposed by any duly authorised regulatory
authority.
10.3 Upon the termination of this Agreement under Paragraph 10.1, VIPC shall
cease to be liable to the Optionor in debt, damages or otherwise save for the
performance of those of its obligations, which theretofore should have been
performed, including those obligations in Paragraph 10.2.
10.4 Upon termination of this Agreement, VIPC shall vacate the Property within
a reasonable time after such termination, but shall have the right of access to
the Property for a period of six months thereafter for the purpose of removing
its chattels, machinery, equipment and fixtures.
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11. FORCE MAJEURE
11.1 The time for performance of any act or making any payment or any
expenditure required under this Agreement shall be extended by the period of any
delay or inability to perform due to fire, strikes, labour disturbances, riots,
civil commotion, wars, acts of God, any present or future law or governmental
regulation, any shortages of labour, equipment or materials, or any other cause
not reasonably within the control of the party in default, other than lack of
finances.
12. REGULATORY APPROVAL
12.1 If this Agreement is subject to the prior approval of any securities
regulatory bodies, then the parties shall use their best efforts to obtain such
regulatory approvals.
13. NOTICES
13.1 Any notice, election, consent or other writing required or permitted to
be given hereunder shall be deemed to be sufficiently given if delivered or
mailed postage prepaid or if given by telegram, telex or telecopier, addressed
as follows:
In the case of the Optionor: DIAMANT RESOURCES LTD.
0000 - 0000 XXXX XXXXXXXX XX.
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XXXXXXXXX, X.X. X0X 0X0
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Canada
Telecopier: (000) 000-0000
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In the case of VIPC: VIPC . COM
0000 Xxxxx XxXxxx,
Xxxxx 0000, Xxx Xxxxx
Xxxxxx
Telecopier: (000) 000-0000
and any such notice given as aforesaid shall be deemed to have been given to the
parties hereto if delivered, when delivered, or if mailed, on the third business
day following the date of mailing, or, if telegraphed, telexed or telecopied, on
the same day as the telegraphing, telexing or telecopying thereof PROVIDED
HOWEVER that during the period of any postal interruption in Canada or the USA
any notice given hereunder by mail shall be deemed to have been given only as of
the date of actual delivery of the same. Any party may from time to time by
notice in writing change its address for the purposes of this Paragraph.
14. GENERAL TERMS AND CONDITIONS
14.1 The parties hereto hereby covenant and agree that they will execute such
further agreements, conveyances and assurances as may be requisite, or which
counsel for the parties may deem necessary to effectually carry out the intent
of this Agreement.
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14.2 This Agreement shall constitute the entire agreement between the parties
with respect to the Property. No representations or inducements have been made
save as herein set forth. No changes, alterations or modifications of this
Agreement shall be bonding upon either party until and unless a memorandum in
writing to such effect shall have been signed by all parties hereto. This
Agreement shall supersede all previous written, oral or implied understandings
between the parties with respect to the matters covered hereby.
14.3 Time shall be of the essence of this Agreement.
14.4 The titles to the sections in this Agreement shall not be deemed to form
part of this Agreement but shall be regarded as having been used for convenience
of reference only.
14.5 Unless otherwise noted, all currency references contained in this
Agreement shall be deemed to be references to United States funds.
14.6 Wherever possible, each provision of this Agreement shall be interpreted
in such manner as to be effective and valid under applicable law, but if any
provision shall be prohibited by or be invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Agreement.
14.7 The Schedules to this Agreement shall be construed with and as an
integral part of this Agreement to the same extent as if they were set forth
verbatim herein.
14.8 Defined terms contained in this Agreement shall have the same meanings
where used in the Schedule.
14.9 This Agreement shall be governed by and interpreted in accordance with
the laws of the State of Nevada.
14.10 This Agreement shall enure to the benefit of and be binding upon the
parties hereto and their respective heirs, executors, administrators, successors
and assigns.
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WITNESS WHEREOF this Agreement has been executed by the Parties hereto as of the
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day and year first above written.
DIAMANT RESOURCES LTD.
by its authorised signatory:
/s/ Xxxxxx Xxxx
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Signature of Authorised Signatory
XXXXXX XXXX
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Name of Authorised Signatory
President
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Position of Authorised Signatory
VIPC VENTURES, INC.
by its authorised signatory:
/s/ Xxxxxx Xxxx
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Signature of Authorised Signatory
XXXXXX XXXX
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Name of Authorised Signatory
President
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Position of Authorised Signatory
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SCHEDULE "A"
PROPERTY DESCRIPTION
Beatton Claim Group
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The Beatton claims lie over a portion of the North American Craton on the Nova
Domain. Field trips have confirmed the presence of garnet covered beaches on the
Beatton River. Geochemistry is encouraging for exploration, because eclogitic
diamond inclusion field garnets and pyroxenes, whole crystal garnet, Kimberlite
I suite accessory minerals, are evident in close proximity to a magnetic
anomaly. The claims consist of 72 Units.
Alces Claim Group
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The Alces claims straddle an inferred deep basement fault. The kimberlitic
indicator G-9 garnets and the diamond indicator pyroxenes found in pits on the
edge of the Alces River channel indicate that there is likely a kimberlitic,
lamprophyric or lamproitic intrusive in the area. Diopsides (CP-2) and chrome
diopsides (CP-5) have been derived from samples. These minerals traditionally do
not survive in the gravel depositional environment for more than a few
kilometres. The claims consist of 125 Units.
List of Claims
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Claim Name | Claim Number
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Beatton 1 240542
Beatton 2 240960
Beatton 3 240961
Beatton 4 240962
Alces 1 240791
Alces 2 240792
Alces 3 240793
Alces 4 240794
Alces 5 240795
Alces 6 240796
Alces 7 699172M
Alces 8 699173M
Alces 9 699174M
Alces 10 699175M
Alces 11 669178M
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