Exhibit 10.10
Members' Agreement of the Members of Tonkin Springs
LLC as Amended by and between Tonkin Springs
Venture Limited Partnership and U.S. Environmental
Corporation dated October 18, 2001.
MEMBERS' AGREEMENT AS AMENDED
of the Members of TONKIN SPRINGS LLC
A Delaware Limited Liability Company
TABLE OF CONTENTS
ARTICLE I DEFINITIONS AND CROSS-REFERENCES
1.1 Definitions.
1.2 Cross References.
ARTICLE II REPRESENTATIONS AND WARRANTIES;TITLE TO
ASSETS; INDEMNITIES
2.1 Representations and Warranties.
2.2 Indemnification.
ARTICLE III INTERESTS OF MEMBERS
3.1 Continuing Liabilities Upon Adjustments of
Ownership Interests.
3.2 Continuing Obligations and Environmental
Liabilities.
3.3 Grant of Lien and Security Interest.
3.4 Subordination of Interests.
ARTICLE IV RELATIONSHIP OF THE MEMBERS
4.1 Transfer or Termination of Rights.
4.2 Abandonment and Surrender of Properties.
4.3 Implied Covenants.
4.4 No Third Party Beneficiary Rights.
ARTICLE V ACQUISITIONS WITHIN AREA OF INTEREST
5.1 General.
5.2 Notice to Non-Acquiring Member.
5.3 Option Exercised.
5.4 Option Not Exercised.
5.5 Non-Compete Covenants.
5.6 Xxxxxxxx-Xxxxxxx Lease.
ARTICLE VI GOVERNING LAW
6.1 Governing Law.
ARTICLE VII GENERAL PROVISIONS
7.1 Notices.
7.2 Gender.
7.3 Currency.
7.4 Headings.
7.5 Waiver.
7.6 Modification.
7.7 Force Majeure.
7.8 Rule Against Perpetuities.
7.9 Further Assurances.
7.10 Entire Agreement; Successors and Assigns.
7.11 Counterparts.
This Amended Members' Agreement (the Agreement)
is made effective as of October 18, 2001 (Effective
Date) between TONKIN SPRINGS VENTURE LIMITED
PARTNERSHIP, a Nevada limited partnership (TSVLP),
the address of which is 0000 Xxxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxx 00000-0000, and U.S.
ENVIRONMENTAL CORPORATION, a Colorado corporation
(USEC), the address of which is 0000 Xxxxxxx
Xxxxxx, Xxxxx 000, Xxxxxxxx, Xxxxxxxx 00000-0000.
RECITALS
X. Xxxxxx Springs Holding Inc., a Colorado
corporation (TSHI) and TSVLP were parties to the
Members' Agreement of Tonkin Springs LLC, dated
February 26, 1999 (the 1999 Agreement). Pursuant
to the 1999 Agreement, TSHI withdrew from the TSLLC
effective October 18, 2001 and the equity interest
of TSHI in TSLLC was thereby transferred to TSVLP
as provided under Section 2.3 of the 1999
Agreement.
B. Immediately prior to the withdrawal of TSHI
from TSLLC, TSVLP sold and transferred to USEC a
1/2 of 1 percent equity interest in TSLLC. After
such transfer and the withdrawal of TSHI, TSVLP
shall own 99.5 percent equity interest in TSLLC
and USEC shall own 0.5 percent equity interest
in TSLLC. TSVLP and USEC are affiliates of each
other.
C. TSVLP and USEC amended the Operating Agreement
of Tonkin Springs LLC effective as of October 18,
2001 (the LLC Agreement as Amended.)
D. TSVLP and USEC desire to continue TSLLC and to
thereby participate in the exploration, evaluation
and, if justified, the development and mining of
mineral resources within the Properties or any
other properties acquired pursuant to the terms of
this Agreement.
E. TSVLP and USEC wish to continue to operate the
limited liability company under the Delaware
Limited Liability Company Act, 6 Del. C.18-101 et.
seq. (the Act) to own and operate the Properties
and Assets. The name of the limited liability
company shall continue to be Tonkin Springs LLC
(the Company) and its affairs shall be governed by
that certain Operating Agreement as Amended of
Tonkin Springs LLC of even date herewith. TSVLP
and USEC desire to enter into this Agreement to
provide, amongst themselves, for their respective
contributions to the Company and for certain other
matters, all as set forth herein.
NOW THEREFORE, in consideration of the covenants
and conditions contained herein, TSVLP and USEC
agree as follows:
ARTICLE I
DEFINITIONS AND CROSS-REFERENCES
I.1 Definitions. The terms defined herein shall
have the defined meaning wherever used in this
Agreement. Capitalized terms used but not defined
in this Agreement shall have the meanings given
thereto in the LLC Agreement as Amended.
I.2 Cross References. References to exhibits are
to Exhibits of the LLC Agreement as Amended.
References to Articles, Sections and Subsections
refer to Articles, Sections and Subsections of this
Agreement unless indicated otherwise. References to
Paragraphs and Subparagraphs refer to paragraphs
and subparagraphs of the referenced Exhibits.
ARTICLE II
REPRESENTATIONS AND WARRANTIES;
TITLE TO ASSETS; INDEMNITIES
II.1 Representations and Warranties.
(a) Capacity of the Members. As of the Effective
Date, each Member warrants and represents to the
other that:
(1) it is a corporation or limited partnership, as
the case may be, duly organized and in good
standing in its state of incorporation or
partnership organization and is qualified to do
business and is in good standing in those states
where necessary in order to carry out the purposes
of this Agreement;
(2) it has the capacity to enter into and perform
this Agreement and all transactions contemplated
herein and all corporate, partnership and other
actions and consents required to authorize it to
enter into and perform this Agreement have been
properly taken or obtained;
(3) it will not breach any other agreement or
arrangement by entering into or performing this
Agreement; and
(4) this Agreement has been duly executed and
delivered by it and is valid and binding upon it in
accordance with its terms.
II.2 Limitation of Liability. The Members shall
not be required to make any contribution to the
capital of the Company except as otherwise provided
in this Agreement, nor shall the Members in their
capacity as Members or Manager be bound by, or
liable for, any debt, liability or obligation of
the Company whether arising in contract, tort, or
otherwise. The foregoing shall not limit any
obligation of a Member to (i) indemnify the other
Member as expressly provided by this Agreement,
(ii) restore a deficit Capital Account as required
by Section 4.2 (b) of Exhibit C of the LLC
Agreement as Amended or (iii) satisfy liabilities
arising under Article IV or Section 5.2 of this
Agreement. Any obligation herein to contribute
capital to the Company may be compromised by
written agreement of the Members, including by
agreements providing for payments by an obligated
Member directly to the other Member.
II.5 Indemnification.
(a) Each Member shall indemnify the other Member,
and its Affiliates and their respective directors,
officers, employees, agents and attorneys,
(collectively Indemnified Party) from and against
all direct and indirect costs, expenses, damages,
obligations, claims, demands, actions or
liabilities, including reasonable attorneys' fees
and other costs of litigation (either threatened or
pending) arising out of or based on a breach by a
Member (Indemnifying Party) of any representation,
warranty or covenant contained in this Agreement or
the LLC Agreement as Amended, including without
limitation:
(i) any action taken for or obligation or
responsibility assumed on behalf of the Company or
another Member by a Member or any of its directors,
officers, employees, agents and attorneys, or
Affiliates, in violation of Section 5.1 of the LLC
Agreement as Amended;
(ii) failure of a Member or its Affiliates to
comply with the non-compete or Area of Interest
provisions of Article V hereof;
(iii) any Transfer that causes termination of the
tax partnership established by Section 5.2 of the
LLC Agreement as Amended, against which the
transferring Member shall indemnify the non-
transferring Member as provided in Subsection
7.2(e) of the LLC Agreement as Amended and Article
V of Exhibit C; and
(iv) failure of a Member or its Affiliates to
comply with the preemptive right under Section 7.3
of the LLC Agreement as Amended and Exhibit H of
the LLC Agreement as Amended.
(b) If any claim or demand is asserted against an
Indemnified Party in respect of which such
Indemnified Party may be entitled to
indemnification under this Agreement, written
notice of such claim or demand shall promptly be
given to the Indemnifying Party. The Indemnifying
Party shall have the right, but not the obligation,
by notifying the Indemnified Party within thirty
(30) days after its receipt of the notice of the
claim or demand, to assume the entire control of
(subject to the right of the Indemnified Party to
participate, at the Indemnified Party's expense and
with counsel of the Indemnified Party's choice) the
defense, compromise or settlement of the matter,
including, at the Indemnifying Party's expense,
employment of counsel of the Indemnifying Party's
choice. Any damages to the assets or business of
the Indemnified Party caused by a failure by the
Indemnifying Party to defend, compromise or settle
a claim or demand in a reasonable and expeditious
manner requested by the Indemnified Party, after
the Indemnifying Party has given notice that it
will assume control of the defense, compromise or
settlement of the matter, shall be included in the
damages for which the Indemnifying Party shall be
obligated to indemnify the Indemnified Party. Any
settlement or compromise of a matter by the
Indemnifying Party shall include a full release of
claims against the Indemnified Party which have
arisen out of the indemnified claim or demand.
ARTICLE III
INTERESTS OF MEMBERS
III.1 Continuing Liabilities Upon Adjustments of
Ownership Interests. As between the Members, any
reduction or elimination of either Member's
Ownership Interest under the LLC Agreement as
Amended or pursuant to a withdrawal or resignation
of a Member from the Company, this Agreement or the
LLC Agreement as Amended shall not relieve such
Member of its share of any arising out of
Operations conducted during the term of this
Agreement but prior to such reduction or
elimination, regardless of when any funds may be
expended to satisfy such liability. For purposes of
this Section and as between the Members, such
Member's share of such liability shall be equal to
its Ownership Interest at the time the act or
omission giving rise to the liability occurred.
Should the cumulative cost of satisfying Continuing
Obligations be in excess of cumulative amounts
accrued or otherwise charged to the Environmental
Compliance Fund as described in Paragraph 3.14 of
Exhibit B of the LLC Agreement as Amended, each of
the Members shall, as between the Members, be
liable for its proportionate share (i.e., Ownership
Interest at the time that the act or omission
giving rise to such liability occurred) of the cost
of satisfying such Continuing Obligations,
notwithstanding that either Member has previously
resigned from the Company or that its Ownership
Interest has been reduced or eliminated pursuant
to the LLC Agreement as Amended.
III.2 Continuing Obligations and Environmental
Liabilities. On dissolution of the Company under
Section 14.1 of the LLC Agreement as Amended, each
Member shall, as between the Members, remain liable
for its respective share of liabilities to third
parties (whether such arises before or after such
dissolution), including Environmental Liabilities
and Continuing Obligations. In the event of the
resignation of a Member pursuant to Section 14.2 of
the LLC Agreement as Amended, the resigning
Member's share of such liabilities shall be equal
to its Ownership Interest at the time such
liability was incurred (or, as to liabilities
arising prior to the Effective Date, its initial
Ownership Interest).
III.3 Grant of Lien and Security Interest.
(a) Subject to Section 3.4 hereof, each Member
grants to the other Member a lien upon and a
security interest in its Ownership Interest,
including all of its right, title and interest in
the Company and the Assets, whenever acquired or
arising, and the proceeds from and accessions to
the foregoing.
(b) The Liens and security interests granted by
Subsection 3.3(a) hereof shall secure every
obligation or liability of the Member granting such
lien or security interest to the other Member
created under this Agreement or the LLC Agreement
as Amended. Each Member hereby agrees to take all
action necessary to perfect such lien and security
interest and hereby appoints the other Member its
attorney-in-fact to execute, file and record all
financing statements and other documents necessary
to perfect or maintain such lien and security
interest.
III.4 Subordination of Interests. Each Member
shall, from time to time, take all necessary
actions, including execution of appropriate
instruments and agreements, to pledge and
subordinate its Ownership Interest, any Liens it
may hold which are created under this Agreement and
any other right or interest it holds with respect
to Tonkin Springs LLC and the Assets (other than
any statutory lien of the Manager) to any secured
borrowings for Operations approved by the
Management Committee, including any secured
borrowings relating to Project Financing, and any
modifications or renewals thereof.
ARTICLE IV
RELATIONSHIP OF THE MEMBERS
IV.1 Transfer or Termination of Rights. Neither
Member shall Transfer all or any part of its rights
or obligations under this Agreement, except in
conjunction with a transfer or termination of the
Member's Ownership Interest permitted by the LLC
Agreement as Amended. Any such permitted assignment
shall be subject to the consent requirements of
Section 7.2 of the LLC Agreement as Amended.
IV.2 Abandonment and Surrender of Properties. The
Member that desires to have the Company abandon or
surrender all or part of the Properties pursuant to
Section 12.2 of the LLC Agreement as Amended shall
remain liable to the other Member for its share
(determined by its Ownership Interest as of the
date of such abandonment) of any liability with
respect to such Properties, including, without
limitation, Continuing Obligations, Environmental
Liabilities and Environmental Compliance, whether
accruing before or after such abandonment, arising
out of activities conducted subsequent to the
Effective Date and out of Operations conducted
prior to the date of such abandonment, regardless
of when any funds may be expended to satisfy such
liability.
IV.3 Implied Covenants. There are no implied
covenants contained in this Agreement other than
those of good faith and fair dealing.
IV.4 No Third Party Beneficiary Rights. This
Agreement shall be construed to benefit the Members
and their respective successors and assigns only,
and shall not be construed to create third party
beneficiary rights in any other party, expressly
including the Company, or in any governmental
organization or agency, except to the extent
required to permit indemnification of a non-Member
Indemnified Party pursuant to Subsection 2.5(a)
hereof.
ARTICLE V
ACQUISITIONS WITHIN AREA OF INTEREST
V.1 General. Any interest or right to acquire any
interest in real property or mineral or water
rights within the Area of Interest acquired during
the term of this Agreement by or on behalf of
either Member (Acquiring Member) or any Affiliate
of such Member shall, in accordance with and
subject to the provisions in this Article V, be
subject to the terms and provisions of this
Agreement and the LLC Agreement as Amended. TSVLP
and USEC and their respective Affiliates for their
separate account shall be free to acquire lands and
interests in lands outside the Area of Interest and
to locate mining claims outside the Area of
Interest. Failure of any Affiliate of either Member
to comply with this Article shall be a breach by
such Member of this Agreement.
V.2 Notice to Non-Acquiring Member. Within thirty
(30) days after the acquisition of any interest or
the right to acquire any interest in real property
or mineral or water rights wholly or partially
within the Area of Interest (except real property
acquired by the Manager pursuant to a Program), the
Acquiring Member shall notify the other Member of
such acquisition by it or its Affiliate; provided
that if the acquisition of any interest or right to
acquire any interest pertains to real property or
water or mineral rights partially within the Area
of Interest, then all such real property or water
or mineral rights (i.e., the part within the Area
of Interest and the part outside the Area of
Interest) shall be subject to this Article. The
Acquiring Member's notice shall describe in detail
the acquisition, the acquiring party if that party
is an Affiliate, the lands and minerals and water
rights covered thereby, the cost thereof, and the
reasons why the Acquiring Member believes that the
acquisition of the interest is in the best
interests of the Members under this Agreement. In
addition to such notice, the Acquiring Member shall
make any and all information concerning the
relevant interest available for inspection by the
other Member.
V.3 Option Exercised. Within thirty (30) days
after receiving the Acquiring Member's notice, the
other Member may notify the Acquiring Member of its
election to have the Company acquire the acquired
interest. Promptly upon such notice, the Acquiring
Member shall convey or cause its Affiliate to
convey to the Company, by special warranty deed,
all of the Acquiring Member's (or its Affiliate's)
interest in such acquired interest, free and clear
of all Encumbrances arising by, through or under
the Acquiring Member (or its Affiliate) other than
those to which both Members have agreed.
Immediately upon such notice, the acquired interest
shall become a part of the Properties for all
purposes of this Agreement and the LLC Agreement as
Amended. The Company shall promptly pay to the
Acquiring Member the latter's actual out-of-pocket
acquisition costs.
V.4 Option Not Exercised. If the other Member does
not give such notice within the thirty (30) day
period set forth in Section 5.3 hereof, it shall
have no interest in the acquired interests, and the
acquired interests shall not be a part of the
Assets or continue to be subject to this Agreement
or the LLC Agreement as Amended.
V.5 Non-Compete Covenants. Neither a Member that
resigns pursuant to Section 14.2 of the LLC
Agreement as Amended, nor any Affiliate of such a
Member, shall directly or indirectly acquire any
interest or right to explore or mine, or both, on
any property any part of which is within the Area
of Interest for twelve (12) months after the
effective date of resignation. If a resigning
Member, or the Affiliate of a resigning Member,
breaches this Section, such Member shall be
obligated to offer to convey to the non-resigning
Member, without cost, any such property or interest
so acquired (or ensure its Affiliate offers to
convey the property or interest to the non-
resigning Member, if the acquiring party is the
resigning Member's Affiliate). Such offer shall be
made in writing and can be accepted by the non-
resigning Member at any time within forty five(45)
days after the offer is received by such non-
resigning Member. Failure of a Member's Affiliate
to comply with this Section shall be a breach by
such Member of this Agreement.
V.6 Xxxxxxxx-Xxxxxxx Lease. Notwithstanding any
provision of this Agreement or the LLC Agreement as
Amended to the contrary, the Manager shall have the
full right and authority, but not the obligation,
to enter into such amendments of the Xxxxxxxx-
Xxxxxxx Lease as the Manager deems appropriate, in
its sole discretion, including without limitation
for the purposes of adding claims to those leased
thereunder, and to convey or quitclaim claims owned
by the Company to the lessors under the Xxxxxxxx-
Xxxxxxx Lease in connection therewith, as the
Manager deems appropriate in its sole discretion.
ARTICLE VI
GOVERNING LAW
VI.1 Governing Law. Except for matters of title to
the Assets Properties or their Transfer, which
shall be governed by the law of their situs, this
Agreement shall be governed by and interpreted in
accordance with the laws of the State of Delaware,
without regard for any conflict of laws or choice
of laws principles that would permit or require the
application of the laws of any other jurisdiction.
ARTICLE VII
GENERAL PROVISIONS
VII.1 Notices. All notices, payments and other
required or permitted communications (Notices) to
either Member shall be in writing, and shall be
addressed respectively as follows:
If to TSVLP: Tonkin Springs Venture Limited
Partnership
0000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxx 00000-0000
Attention: President, U.S. Gold Corporation
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to USEC: U.S. Environmental Corporation
0000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxx 00000-0000
Attention: President, U.S. Environmental
Corporation
Telephone: (000) 000-0000
Facsimile: (000) 000-00000
All Notices shall be given (a) by personal delivery
to the Member; (b) by electronic communication,
capable of producing a printed transmission and
confirmation, (c) by registered or certified mail
return receipt requested; or (d) by overnight or
other express courier service. All Notices shall be
effective and shall be deemed given on the date of
receipt at the principal address if received during
normal business hours, and, if not received during
normal business hours, on the next business day
following receipt, or if by electronic
communication, on the date of such communication.
Either Member may change its address by Notice to
the other Member.
VII.2 Gender. The singular shall include the
plural, and the plural the singular wherever the
context so requires, and the masculine, the
feminine, and the neuter genders shall be mutually
inclusive.
VII.3 Currency. All references to dollars or $
herein shall mean lawful currency of the United
States of America.
VII.4 Headings. The subject headings of the
Sections and Subsections of this Agreement and the
Paragraphs and Subparagraphs of the Exhibits to
this Agreement are included for purposes of
convenience only, and shall not affect the
construction or interpretation of any of its
provisions. References to hereunder are, unless
otherwise stated, references to this entire
Agreement.
VII.5 Waiver. The failure of either Member to
insist on the strict performance of any provision
of this Agreement or to exercise any right, power
or remedy upon a breach hereof shall not constitute
a waiver of any provision of this Agreement or
limit such Member's right thereafter to enforce any
provision or exercise any right.
VII.6 Modification. No modification or amendment
of this Agreement shall be valid unless made in
writing and duly executed by both Members.
VII.7 Force Majeure. The obligations of a Member
arising under this Agreement or under the LLC
Agreement as Amended shall be suspended to the
extent and for the period that performance is
prevented by any cause, whether foreseeable or
unforeseeable, beyond its reasonable control,
including, without limitation, labor disputes
(however arising and whether or not employee
demands are reasonable or within the power of the
Member to grant); acts of God; Laws, instructions
or requests of any government or governmental
entity; judgments or orders of any court; inability
to obtain on reasonably acceptable terms any public
or private license, permit or other authorization;
curtailment or suspension of activities to remedy
or avoid an actual or alleged, present or
prospective violation of Environmental Laws; action
or inaction by any federal, state or local agency
that delays or prevents the issuance or granting of
any approval or authorization required to conduct
Operations (including, without limitation, a
failure to complete any review and analysis
required by the National Environmental Policy Act
or any similar state law); acts of war or
conditions arising out of or attributable to war,
whether declared or undeclared; riot, civil strife,
insurrection or rebellion; fire, explosion,
earthquake, storm, flood, sink holes, drought or
other adverse weather condition; delay or failure
by suppliers or transporters of materials, parts,
supplies, services or equipment or by contractors'
shortage of, or inability to obtain, labor,
transportation, materials, machinery, equipment,
supplies, utilities or services; accidents;
breakdown of equipment, machinery or facilities;
actions by native rights groups, environmental
groups, or other similar special interest groups;
or any other cause whether similar or dissimilar to
the foregoing. The affected Member shall promptly
give notice to the other Member of the suspension
of performance, stating therein the nature of the
suspension, the reasons therefore, and the expected
duration thereof. The affected Member shall resume
performance as soon as reasonably possible. During
the period of suspension the obligations of both
Members to advance funds pursuant to this Agreement
or the LLC Agreement as Amended shall be reduced to
levels consistent with then current Operations.
VII.8 Rule Against Perpetuities. The Members do
not intend that there shall be any violation of the
rule against perpetuities, the rule against
unreasonable restraints on the alienation of
property, or any similar rule. Accordingly, if any
right or option to acquire any interest in the
Properties or Assets, in an Ownership Interest, or
the Company, or in any real property exists under
this Agreement, such right or option must be
exercised, if at all, so as to vest such interest
within time periods permitted by applicable rules.
If, however, any such violation should
inadvertently occur, the Members hereby agree that
a court shall reform that provision in such a way
as to approximate most closely the intent of the
Members within the limits permissible under such
rules.
VII.9 Further Assurances. Each of the Members
shall take, from time to time and without
additional consideration, such further actions and
execute such additional instruments as may be
reasonably necessary or convenient to implement and
carry out the intent and purposes of this Agreement
or as may be reasonably required by lenders in
connection with Project Financing.
VII.10 Entire Agreement; Successors and Assigns.
This Agreement contains the entire understanding of
the Members and supersedes all prior agreements and
understandings between the Members relating to the
subject matter hereof; provided that nothing in
this Section 7.10 modifies or affects the LLC
Agreement as Amended and the Members' obligations
thereunder. This Agreement shall be binding upon
and inure to the benefit of the respective
successors and permitted assigns of the Members.
VII.11 Counterparts. This Agreement may be
executed in any number of counterparts, and it
shall not be necessary that the signatures of both
Members be contained on any counterpart. Each
counterpart shall be deemed an original, but all
counterparts together shall constitute one and the
same instrument.
IN WITNESS WHEREOF, the parties hereto have
executed this Agreement as of the Effective Date.
TONKIN SPRINGS VENTURE LIMITED PARTNERSHIP
By: Tonkin Springs Gold Mining Company, as its
General Partner
By:/s/Xxxxxxx X. Xxxx, President
BY: U.S. ENVIRONMENTAL CORPORATION
By:/s/Xxxxx X. Xxxx, President
Exhibit 10.12
Operating Agreement of the Members
of Tonkin Springs LLC as Amended by and between
Tonkin Springs Venture Limited Partnership and U.S.
Environmental Corporation dated October 18, 2001.
OPERATING AGREEMENT OF
TONKIN SPRINGS LLC
A Delaware Limited Liability Company
As Amended Effective October 18, 2001
TABLE OF CONTENTS
ARTICLE I DEFINITIONS AND CROSS-REFERENCES
1.1 Definitions
1.2 Cross References
ARTICLE I NAME, PURPOSES AND TERM
2.1 Formation
2.2 Name
2.3 Purposes
2.4 Limitation
2.5 Term
2.6 Registered Agent; Offices
2.7 Record Title
ARTICLE III INTERESTS OF MEMBERS
3.1 Amended Ownership Interests
3.2 Changes in Ownership Interests
3.3 Documentation of Adjustments to Ownership
Interests
ARTICLE IV ADJUSTMENTS OF MEMBERS' INTERESTS AND
RELATED LIABILITIES; TREATMENT OF CASHFLOW AND
CERTAIN PAYMENTS
4.1 Evidence of Changes in Ownership Interests
4.2 Distributions
ARTICLE V RELATIONSHIP OF THE MEMBERS
5.1 Limitation on Authority of Members
5.2 Federal Tax Elections and Allocations
5.3 State Income Tax
5.4 Tax Returns
5.5 Other Business Opportunities
5.6 Waiver of Rights to Partition or Other
Division of Assets
5.7 Bankruptcy of a Member
5.8 Implied Covenants
5.9 No Certificate
5.10 Limitation of Liability
5.11 Indemnities
5.12 No Third Party Beneficiary Rights
ARTICLE VI REPRESENTATIONS AND WARRANTIES
6.1 Capacity of the Members
ARTICLE VII TRANSFER OF INTEREST; PREEMPTIVE RIGHT
7.1 General
7.2 Limitations on Free Transferability
7.3 Preemptive Right
ARTICLE VIII MANAGEMENT COMMITTEE
8.1 Organization and Composition
8.2 Decisions
8.3 Meetings
8.4 Action Without Meeting
8.5 Matters Requiring Approval
ARTICLE IX MANAGER
9.1 Appointment
9.2 Powers and Duties of Manager
9.3 Standard of Care; Indemnification
9.4 Resignation; Deemed Offer to Resign
9.5 Payments To Manager
9.6 Transactions With Affiliates
9.7 Activities During Deadlock
ARTICLE X PROGRAMS AND BUDGETS
10.1 Operations Pursuant to Programs and Budgets
10.2 Presentation of Programs and Budgets
10.3 Review and Adoption of Proposed Programs and
Budgets
10.4 Emergency or Unexpected Expenditures
10.58 Amendments to Programs and Budgets
ARTICLE XI ACCOUNTS AND SETTLEMENTS
11.1 Monthly Statements
11.2 Cash Calls
11.3 Failure to Meet Cash Calls
11.4 Audits
ARTICLE XII PROPERTIES
12.1 Royalties, Production Taxes and Other
Payments Based on Production
12.2 Abandonment and Surrender
12.3 Reaquisitions.
12.4 Disposition of Products by Manager.
ARTICLE XIII CONFIDENTIALITY, OWNERSHIP, USE
AND DISCLOSURE OF INFORMATION
13.1 Business Information
13.2 Disclosure Required By Law
13.3 Public Announcements
13.4 Duration of Confidentiality.
ARTICLE XIV RESIGNATION AND DISSOLUTION
14.1 Events of Dissolution
14.2 Resignation
14.3 Disposition of Assets on Dissolution
14.4 Filing of Certificate of Cancellation
14.5 Right to Data After Dissolution
14.6 Continuing Authority
ARTICLE XV GOVERNING LAW
15.1 Governing Law
ARTICLE XVI GENERAL PROVISIONS
16.1 Notices
16.2 Gender
16.3 Currency
16.4 Headings
16.5 Waiver
16.6 Modification
16.7 Force Majeure
16.8 Rule Against Perpetuities
16.9 Further Assurances
16.10 Entire Agreement; Successors and Assigns
16.11 Counterparts
OPERATING AGREEMENT OF
TONKIN SPRINGS LLC
A Delaware Limited Liability Company
This Amended Operating Agreement of Tonkin
Springs LLC (this Agreement) is made effective as
of October 18, 2001, (the Effective Date) between
TONKIN SPRINGS VENTURE LIMITED PARTNERSHIP, a
Nevada limited partnership (TSVLP), the address of
which is 0000 Xxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxx,
Xxxxxxxx 00000-0000, and U.S. ENVIRONMENTAAL
CORPORATION (USEC), the address of which is 0000
Xxxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxx, Xxxxxxxx
00000-0000.
RECITALS
X. Xxxxxx Springs Holding Inc., a Colorado
corporation (TSHI) and TSVLP were parties to the
Operating Agreement of Tonkin Springs LLC, dated
February 26, 1999 (the 1999 Agreement). Pursuant
to the 1999 Agreement, TSHI withdrew from the TSLLC
effective October 18, 2001 and the equity interest
of TSHI in TSLLC was thereby transferred to TSVLP
as provided under Section 2.3 of the 1999
Agreement.
B. Immediately prior to the withdrawal of TSHI
from TSLLC, TSVLP sold and transferred to USEC a
1/2 of 1 percent equity interest in TSLLC. After
such transfer and the withdrawal of TSHI, TSVLP
shall own 99.5 percent equity interest in TSLLC and
USEC shall own 0.5 percent equity interest in
TSLLC. TSVLP and USEC are affiliates of each
other.
C. TSVLP and USEC have amended the Members'
Agreement of Tonkin Springs LLC effective as of
October 18, 2001 (Members' Agreement as Amended.)
D. TSVLP and USEC desire to continue TSLLC and to
thereby participate in the exploration, evaluation
and, if justified, the development and mining of
mineral resources within the Properties or any
other properties acquired pursuant to the terms of
this Agreement.
E. TSVLP and USEC wish to continue to operate the
limited liability company under the Delaware
Limited Liability Company Act, 6 Del.C. 18-101 et
seq. (the Act) to own and operate the Properties
and Assets in accordance with the terms set forth
in this Agreement. Such company (the Company)
shall continue under the named Tonkin Springs LLC.
NOW THEREFORE, in consideration of the covenants
and conditions contained herein, TSVLP and USEC
agree as follows:
ARTICLE I
DEFINITIONS AND CROSS-REFERENCES
1.1 Definitions. The terms defined in Exhibit D
and elsewhere herein shall have the defined meaning
wherever used in this Agreement, including in
Exhibits.
1.2 Cross References. References to Exhibits,
Articles, Sections and Subsections refer to
Exhibits, Articles, Sections and Subsections of
this Agreement. References to Paragraphs and
Subparagraphs refer to paragraphs and subparagraphs
of the referenced Exhibits.
ARTICLE II
NAME, PURPOSES AND TERM
2.1 Formation. The Company has been duly
organized pursuant to the Act and the provisions of
this Agreement as a Delaware limited liability
company by the filing of its Certificate of
Formation and Certificate of Amendment (as defined
in the Act) in the Office of the Secretary of the
State of Delaware.
2.2 Name. The name of the Company is and shall
continue to be Tonkin Springs LLC and such other
name or names complying with the Act as the Manager
shall determine. The Manager shall accomplish any
filings or registrations required by jurisdictions
in which the Company conducts its Business.
2.3 Purposes. The Company is formed for the
following purposes and for no others, and shall
serve as the exclusive means by which each of the
Members accomplishes such purposes:
(a) to conduct Exploration within the Area of
Interest,
(b) to acquire additional real property and other
interests within the Area of Interest,
(c) to evaluate the possible Development and
Mining of the Properties, and, if justified, to
engage in Development and Mining
(d) to engage in marketing Products, and
(e) to perform any other activity necessary,
appropriate, or incidental to any of the foregoing,
including but not limited to permitting,
reclamation, closure and other environmental
compliance activities.
2.4 Limitation. Unless the Members otherwise
agree in writing, the Business of the Company shall
be limited to the purposes described in Section
2.3, and nothing in this Agreement shall be
construed to enlarge such purposes.
2.5 Term. The term of the Company shall begin on
the Effective Date and shall continue for twenty
(20) years from the Effective Date and for so long
thereafter as the Manger is continuing to maintain
the Properties or Products are produced from the
Properties on a continuous basis, and thereafter
until all materials, supplies, equipment and
infrastructure have been salvaged and disposed of,
and any required Environmental Compliance is
completed and accepted, unless the Company is
earlier terminated as herein provided. For purposes
hereof, Products shall be deemed to be produced
from the Properties on a continuous basis so long
as production in commercial quantities is not
halted for more than 24 months.
2.6 Registered Agent; Offices. The name of the
Company's registered agent in the State of Delaware
is The Corporation Trust Company or such other
person as the Manager may select in compliance with
the Act from time to time. The registered office of
the Company in the State of Delaware shall be
located at c/o The Corporation Trust Company, 0000
Xxxxxx Xxxxxx, Xxxxxxxxxx, XX 00000 or at any other
place within the State of Delaware which the
Manager shall select. The principal office of the
Company shall be at any other location which the
Manager shall select.
2.7 Record Title. Title to the Assets shall be
held by the Company.
ARTICLE III
INTERESTS OF MEMBERS
3.1 Amended Ownership Interests. The Members
shall have the following amended Ownership
Interests:
TSVLP-ninety nine and one half percent (99.5%)
USEC -one half of one (0.5%)
3.2 Changes in Ownership Interests. The Ownership
Interests shall be adjusted as follows:
(a) As provided in the Members' Agreement as
Amended Agreement;
(b) Upon Transfer by either Member of part or
all of its Ownership Interest in accordance with
Article VII; or
(c) Upon acquisition by either Member of part or
all of the Ownership Interest of the other Member,
however arising.
3.3 Documentation of Adjustments to Ownership
Interests. Each Member's Ownership Interest and
related Capital Account balance shall be shown in
the accounting records of the Company, as
maintained by the Manager, and any adjustments
thereto, including adjustments made under Article
IV, shall be made monthly and shall be preceded by
a notice to both Members with a written explanation
of the basis such adjustments.
ARTICLE IV
ADJUSTMENTS OF MEMBERS' INTERESTS AND
TREATMENT OF CASHFLOW.
4.1 Evidence of Changes in Ownership Interests.
An adjustment to an Ownership Interest as provided
in Section III shall not be evidenced by the
execution, issuance or recording of certificates or
other instruments, but each Member's Ownership
Interest shall be shown in the books of the
Company, as maintained by the Manager. Each Member
shall be provided with appropriately detailed
information regarding the basis and method of each
such adjustments.
4.2 Distributions.
(a) Provided that no Member's initial Ownership
Interest has been adjusted pursuant to Section III,
ninety nine and one half percent (99.5) of one
hundred percent (100%) of positive Cash Flow shall
be distributed to TSLLC and the remaining one half
of one percent (0.5%) of one hundred percent (100%)
of positive Cash Flow shall be distributed to USEC.
ARTICLE V
RELATIONSHIP OF THE MEMBERS
5.1 Limitation on Authority of Members. No Member
is an agent of the Company solely by virtue of
being a Member, and no Member has authority to act
for the Company solely by virtue of being a Member.
This Section 5.1 supersedes any authority granted
to the Members pursuant to the Act. Any Member
that takes any action or binds the Company in
violation of this Section 5.1 shall be solely
responsible for any loss or expense incurred by the
Company, the other Member or the Manager as a
result of the unauthorized action and shall
indemnify and hold harmless the Company, the other
Member and the Manager with respect to all such
losses and expenses.
5.2 Federal Tax Elections and Allocations. The
Company shall be treated as a partnership for
federal income tax purposes, and no Member shall
take any action to alter such treatment. Tax
elections and allocations shall be made as set
forth in Exhibit C.
5.3 State Income Tax. To the extent permissible
under applicable law, the relationship of the
Members shall be treated for state income tax
purposes in the same manner as it is for federal
income tax purposes.
5.4 Tax Returns. After approval of the Management
Committee, any tax returns or other required tax
forms shall be filed in accordance with Exhibit C.
5.5 Other Business Opportunities. Each Member shall
have the right to engage in and receive full
benefits from any independent business activities
or operations outside of the Area of Interest,
whether or not competitive with the Company,
without consulting with, or obligation to, the
other Member or the Company. The doctrines of
corporate opportunity or business opportunity shall
not be applied to the Business nor to any other
activity or operation of any Member outside the
Area of Interest. Except as otherwise provided in
Section 6.5 of the Members' Agreement as Amended,
no Member shall have any obligation to the Company
or any other Member with respect to any opportunity
to acquire any property outside the Area of
Interest at any time, or within the Area of
Interest after the termination of the Company.
Unless otherwise agreed in writing, neither the
Manager nor any Member shall have any obligation to
mill, beneficiate or otherwise treat any Products
in any facility owned or controlled by the Manager
or such Member.
5.6 Waiver of Rights to Partition or Other Division
of Assets. The Members hereby waive and release all
rights of partition, or of sale in lieu thereof, or
other division of Assets, including any such rights
provided by Law.
5.7 Bankruptcy of a Member. A Member shall cease to
have any power as a Member or Manager or any voting
rights or rights of approval hereunder upon
bankruptcy, insolvency, dissolution or assignment
for the benefit of creditors of such Member, and
its successor upon the occurrence of any such event
shall have only the rights, powers and privileges
of a transferee enumerated in Section 7.2, and
shall be liable for all obligations of the Member
under this Agreement. In no event, however, shall a
personal representative or successor become a
substitute Member unless the requirements of
Section 7.2 are satisfied.
5.8 Implied Covenants. There are no implied
covenants (including without limitation any implied
covenants relating to the conduct of Exploration,
Development, Mining or other activities upon or
with respect to the Properties) contained in this
Agreement other than those of good faith and fair
dealing.
5.9 No Certificate. The Company shall not issue
certificates representing Ownership Interests in
the Company.
5.10 Limitation of Liability. The Members shall not
be required to make any contribution to the capital
of the Company except as otherwise provided in this
Agreement, nor shall the Members in their capacity
as Members or Manager be bound by, or liable for,
any debt, liability or obligation of the Company
whether arising in contract, tort, or otherwise,
except as expressly provided by this Agreement.
5.11 Indemnities. The Company may, and shall have
the power to, indemnify and hold harmless any
Member, the Manager or any other person from and
against any and all claims and demands whatsoever
arising from or related to the Business, the
Company, the Assets, Operations or a Member's
membership in the Company.
5.12 No Third Party Beneficiary Rights. This
Agreement shall be construed to benefit the Members
and their respective successors and assigns only,
and shall not be construed to create third party
beneficiary rights in any other party or in any
governmental organization or agency.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
6.1 Capacity of the Members. As of the Effective
Date, each Member warrants and represents to the
other that:
(a) it is a corporation or limited partnership,
as the case may be, duly organized and in good
standing in its state of incorporation or
partnership organization and is qualified to do
business and is in good standing in those states
where necessary in order to carry out the purposes
of this Agreement;
(b) it has the capacity to enter into and
perform this Agreement and all transactions
contemplated herein and all corporate, partnership
and other actions and consents required to
authorize it to enter into and perform this
Agreement have been properly taken or obtained;
(c) it will not breach any other agreement or
arrangement by entering into or performing this
Agreement; and
(d) this Agreement has been duly executed and
delivered by it and is valid and binding upon it in
accordance with its terms.
ARTICLE VII
TRANSFER OF INTEREST; PREEMPTIVE RIGHT
7.1 General. A Member shall have the right to
Transfer to a third party, its Ownership Interest,
or any beneficial interest therein (including
without limitation any right or interest created
pursuant to this Agreement or the Members'
Agreement), solely as provided in this Article VII.
7.2 Limitations on Free Transferability. In
addition to being subject to preemptive rights as
described in Section 7.4 and Exhibit H, any
Transfer by either Member under Section 7.1 shall
be subject to the following limitations:
(a) No Member shall Transfer any legal or
beneficial right, title or interest (i) in or to
the Company, the Properties or the Assets, or (ii)
arising under this Agreement or the Members'
Agreement as Amended (including, but not limited
to, any royalty, profits, or other interest in the
Products) except in conjunction with the Transfer
of part or all of its Ownership Interest in the
Company and the relinquishment of its entire
Ownership Interest;
(b) Neither Member, without the consent of the
other Member, shall make a Transfer that violates
any Law, or results in the cancellation of any
permits, licenses, or other similar authorization;
(c) No Transfer permitted by this Article shall
relieve the transferring Member of any liability of
such transferring Member under this Agreement or
under the Members' Agreement as Amended, whether
accruing before or after such Transfer;
(e) Any Member that makes a Transfer that shall
cause termination of the tax partnership
established by Section 5.2 shall indemnify the
other Member for, from and against any and all
loss, cost, expense, damage, liability or claim
therefore arising from the Transfer, including
without limitation any increase in taxes, interest
and penalties or decrease in credits caused by such
termination and any tax on indemnification proceeds
received by the indemnified Member;
(f) In the event of a Transfer of less than all
of an Ownership Interest, the transferring Member
and its transferee shall act and be treated as one
Member under this Agreement; provided however, that
in order for such Transfer to be effective, the
transferring Member and its transferee must first:
(i) agree, as between themselves, that one of
them is authorized to act as the sole agent (Agent)
on their behalf with respect to all matters
pertaining to this Agreement, the Members'
Agreement as Amended and the Company; and
(ii) provide written notice to the other Member,
the Manager and the Company of the designation of
the Agent, and in such notice warrant and represent
to the other Member, the Manager and the Company
that:
(A) the Agent has the sole authority to act on
behalf of, and to bind, the transferring Member and
its transferee with respect to all matters
pertaining to this Agreement, the Members'
Agreement as Amended and the Company;
(B) the other Member, the Manager and the Company
may rely on all decisions of, notices and other
communications from, and failures to respond by,
the Agent, as if given (or not given) by the
transferring Member and its transferee; and
(C) all decisions of, notices and other
communications from, and failures to respond by,
the other Member, the Manager or the Company to the
Agent shall be deemed to have been given (or not
given) to the transferring Member and its
transferee.
The transferring Member and its transferee may
change the Agent (but such replacement must be one
of them) by giving written notice to the other
Member, the Manager and the Company, which notice
must conform to Subsection 7.2(f)(ii).
7.3 Preemptive Right. Any Transfer by either Member
under Section 7.1 and any Transfer by an Affiliate
in Control of either Member shall be subject to a
preemptive right of the other Member to the extent
provided in Exhibit H. Failure of a Member's
Affiliate to comply with this Section and Exhibit H
shall be a breach by such Member of this Agreement.
ARTICLE VIII
MANAGEMENT COMMITTEE
8.1 Organization and Composition. The Members
hereby establish a Management Committee to
determine overall policies, objectives, procedures,
methods and actions under this Agreement. Except
in the case of an emergency as provided for in
Section 10.8, all Programs, Budgets, Project
Financings and other significant matters concerning
the Operations will be subject to the supervision
of the Management Committee. The Management
Committee shall consist of one (1) member appointed
by TSVLP and one (1) member appointed by USEC.
Each Member may appoint one or more alternates to
act in the absence of a regular member. Any
alternate so acting shall be deemed a member.
Appointments shall be made or changed by notice to
the other Member and to the Manager.
8.2 Decisions. Each Member, acting through its
appointed members shall have one vote on the
Management Committee. Unless otherwise provided in
this Agreement, the vote of the Member with an
Ownership Interest over fifty percent (50%) shall
determine all decisions of the Management Committee
8.3 Meetings. The Management Committee shall hold
regular meetings at least quarterly in Lakewood,
Colorado, or at other mutually agreed places. The
Manager shall give 30 days' written notice to the
Members of such regular meetings. Additionally,
either Member may call a special meeting upon 30
days' notice to the Manager and the other Member.
In case of emergency, reasonable notice of a
special meeting shall suffice. There shall be a
quorum if one or more members is present who
represent Ownership Interests greater than fifty
percent (50%) of all Ownership Interests. Each
notice of a meeting shall include an itemized
agenda prepared by the Manager in the case of a
regular meeting, or by the Member calling the
meeting in the case of a special meeting, but any
matters may be considered with the consent of all
Members. The Manager shall prepare minutes of all
meetings and shall distribute copies of such
minutes to the Members within 30 days after the
meeting. The minutes, when signed by all Members,
shall be the official record of the decisions made
by the Management Committee and shall be binding on
the Manager and the Members. If personnel employed
in Operations are required to attend a Management
Committee meeting, reasonable costs incurred in
connection with such attendance shall be a Company
cost. All other costs shall be paid for by the
Members individually.
8.4 Action Without Meeting. In lieu of meetings,
the Management Committee may hold telephone
conferences, so long as all decisions are
immediately confirmed in writing by the Members.
8.5 Matters Requiring Approval. Except as otherwise
delegated to the Manager in Section 9.2, the
Management Committee shall have exclusive authority
to determine all management matters related to this
Agreement.
ARTICLE IX
MANAGER
9.1 Appointment. TSVLP shall have the right to
appoint the initial Manager and hereby appoints
itself as Manager with overall management
responsibility for Operations. TSVLP shall serve
until it resigns as provided in Section 9.4.
9.2 Powers and Duties of Manager. Subject to the
terms and provisions of this Agreement, the Manager
shall have the following powers and duties, which
shall be discharged in accordance with adopted
Programs and Budgets:
(a) The Manager shall manage, direct and control
Operations.
(b) The Manager shall implement the decisions of
the Management Committee, shall make all
expenditures necessary to carry out adopted
Programs, and shall promptly advise the Management
Committee if it lacks sufficient funds to carry out
its responsibilities under this Agreement.
(c) The Manager shall:
(i) purchase or otherwise acquire all material,
supplies, equipment, water, utility and
transportation services required for Operations,
such purchases and acquisitions to be made on the
best terms available, taking into account all of
the circumstances;
(ii) contract for services such as contract
services for the Exploration, Development or Mining
of the Properties,
(iii) obtain such customary warranties and
guarantees as are available in connection with such
purchases and acquisitions; and
(iv) keep the Assets free and clear of all Liens
and Encumbrances, except for those existing at the
time of, or created concurrent with, the
acquisition of such Assets, or mechanic's or
materialmen's Liens which shall be released or
discharged in a diligent matter, or Liens and
Encumbrances specifically approved by the
Management Committee or created pursuant to the
operation of this Agreement or the Members'
Agreement as Amended.
(d) The Manager shall conduct such title
examinations and cure such title defects as may be
advisable in the reasonable judgment of the
Manager.
(e) The Manager shall:
(i) make or arrange for all payments required by
leases, licenses, permits, authorities, contracts
and other agreements related to the Assets;
(ii) pay all taxes, assessments and like charges
on Operations and Assets except taxes determined or
measured by a Member's sales revenue or net income.
If authorized by the Management Committee, the
Manager shall have the right to contest in the
courts or otherwise, the validity or amount of any
taxes, assessments or charges if the Manager deems
them to be unlawful, unjust, unequal or excessive,
or to undertake such other steps or proceedings as
the Manager may deem reasonably necessary to secure
a cancellation, reduction, readjustment or
equalization thereof before the Manager shall be
required to pay them, but in no event shall the
Manager permit or allow title to the Assets to be
lost as the result of the nonpayment of any taxes,
assessments or like charges; and
(iii) shall do all other acts reasonably
necessary to maintain the Assets.
(f) The Manager shall:
(i) apply for all necessary permits, licenses and
approvals;
(ii) comply with applicable federal, state and
local laws and regulations;
(iii) notify promptly the Management Committee of
any allegations of substantial violation thereof;
(iv) prepare and file all reports or notices
required for Operations; and
(v) arrange for bonds and reclamation for both
pre-existing and new conditions and disturbances of
the Properties, at the Company's cost;
The Manager shall not be in breach of this
provision if a violation has occurred in spite of
the Manager's good faith efforts to comply, and the
Manager has timely cured or disposed of such
violation through performance, or payment of fines
and penalties.
(g) The Manager shall prosecute and defend, but
shall not initiate without consent of the
Management Committee, all litigation or
administrative proceedings arising out of
Operations. The non-managing Member shall have the
right to participate, at its own expense, in such
litigation or administrative proceedings.
(h) The Manager shall provide insurance for the
benefit of the Company and the Members as
reasonably determined by the Manager.
(i) The Manager may dispose of Assets, whether
through abandonment, surrender or Transfer, subject
to the limitation set forth in Section 12.2.
(j) The Manager shall have the right to carry out
its responsibilities hereunder through agents,
Affiliates or independent contractors.
(k) The Manager shall perform or cause to be
performed during the term of this Agreement all
assessment and other work required by law in order
to maintain the unpatented mining claims included
within the Properties. The Manager shall have the
right to perform the assessment work required
hereunder pursuant to a common plan of exploration
and continued actual occupancy of such claims and
sites shall not be required. The Manager shall not
be liable on account of any determination by any
court or governmental agency that the work
performed by the Manager does not constitute the
required annual assessment work or occupancy for
the purposes of preserving or maintaining ownership
of the claims, provided that the work done is in
accordance with the adopted Program and Budget.
The Manager shall timely pay all fees and record
with the appropriate county and file with the
appropriate United States agency, affidavits or
other documents required by law to maintain all
such claims or sites.
(l) If authorized by the Management Committee, the
Manager may:
(i) locate, amend or relocate any unpatented
mining claim or mill site or tunnel site,
(ii) locate any fractions resulting from such
amendment or relocation,
(iii) apply for patents or mining leases or other
forms of mineral tenure for any such unpatented
claims or sites,
(iv) abandon any unpatented mining claims for the
purpose of locating mill sites or otherwise
acquiring from the United States rights to the
ground covered thereby,
(v) abandon any unpatented mill sites for the
purpose of locating mining claims or otherwise
acquiring from the United States rights to the
ground covered thereby,
(vi) exchange with or convey to the United States
any of the Properties for the purpose of acquiring
rights to the ground covered thereby or other
adjacent ground, and
(vii) convert any unpatented claims or mill sites
into one or more leases or other forms of mineral
tenure pursuant to any federal law hereafter
enacted.
(m) The Manager shall keep and maintain all
required accounting and financial records pursuant
to the Accounting Procedure and in accordance with
customary cost accounting practices in the mining
industry. The Manager shall respond in a timely
manner to all requests from Members for information
necessary to meet filing deadlines imposed by Law.
(n) The Manager shall keep the Management Committee
advised of all Operations by submitting in writing
to the Management Committee:
(i) quarterly progress reports which include
statements of expenditures and comparisons of such
expenditures to the adopted Budget;
(ii) periodic summaries of data acquired,
reasonably in advance of Management Committee
meetings;
(iii) copies of reports concerning Operations,
reasonably in advance of Management Committee
meetings;
(iv) a detailed final report within 30 days after
completion of each Program and Budget, but in no
event less often than annually, which shall include
comparisons between actual and budgeted
expenditures and comparisons between the objectives
and results of Programs; and
(v) such other reports as the Management
Committee may reasonably request.
At all reasonable times the Manager shall provide
the Management Committee or the duly authorized
representative of any Member (including
representatives of any actual or potential lenders,
equity investors that are duly authorized in
writing by a Member) access to, and the right to
inspect and copy all maps, drill logs, core tests,
reports, surveys, assays, analyses, production
reports, operations, technical, accounting and
financial records, and other information acquired
in Operations, including all computer files an
databases related thereto. In addition, the
Manager shall allow the non-managing Member or that
Member's authorized representative or invitee, at
that Member's sole risk and expense, and subject to
reasonable safety regulations, to inspect the
Assets and Operations at all reasonable times, so
long as the inspecting Member does not unreasonably
interfere with Operations.
(o) The Manager shall undertake all other
activities reasonably necessary to fulfill the
foregoing.
(p) The Manager shall have the right to require the
Members to fully fund the Environmental Compliance
Fund, in proportion to their respective Ownership
Interests, and in accordance with Section 3.14 of
Exhibit B, with all reasonably anticipated costs of
future reclamation, closure and Environmental
Compliance. No Member who has resigned or
withdrawn from the Company will be required to
contribute additional funds to the Environmental
Compliance Fund unless and until all contribution
made to said Environmental Compliance Fund prior to
such withdrawal or resignation have been spent or
committed to be spent.
(q) The Manager shall otherwise conduct Operations
as it deems appropriate in its discretion.
The Manager shall not be in default of any duty
under this Section 9.2 if its failure to perform
results from the failure of the Members to perform
acts or to contribute amounts required of them by
this Agreement.
9.3 Standard of Care; Indemnification. The Manager
shall conduct all Operations in a good, workmanlike
and efficient manner, in accordance with sound
mining and other applicable industry standards and
practices, and in accordance with the terms and
provisions of leases, licenses, permits, contracts
and other agreements pertaining to the Assets. The
Manager shall not be liable to the non-managing
Member for any act or omission resulting in damage
or loss except to the extent caused by or
attributable to the Manager's willful misconduct or
gross negligence. The Members shall indemnify and
hold harmless the Manager and its officers,
employees and agents from and against any
liabilities, obligations, claims, responsibilities,
actions, demands, losses, costs or expenses,
including but not limited to costs of litigation
and reasonable attorneys fees, arising out of or
relating to its activities as Manager, except that
any liabilities or obligations arising directly
from the Manager's gross negligence or willful
misconduct shall be excluded form this indemnity.
9.4 Resignation; Deemed Offer to Resign. The
Manager may resign upon three months' prior notice
to the other Member, in which case the other Member
may elect to become the new Manager by notice to
the resigning Member within 30 days after the
notice of resignation. In the case of any
resignation as Manager by TSVLP, USEC shall be
deemed to be the other Member and TSVLP shall be
deemed to be the resigning Member for purposes of
this Section 9.4. If any of the following shall
occur, the Manager shall be deemed to have offered
to resign, which offer shall be accepted by the
other Member, if at all, within 90 days following
such deemed offer:
(a) The Ownership Interest of the Member who
serves as or who appoints the Manager shall become
less than fifty percent (50%); or
(b) The Manager fails to perform a material
obligation imposed upon it under this Agreement and
such failure continues for a period of 30 days
after notice from the other Member demanding
performance; or
(c) The Manager fails to pay or contest in good
faith its bills within 60 days after they are due;
or
(d) A receiver, liquidator, assignee, custodian,
trustee, sequestrator or similar official for a
substantial part of its assets is appointed and
such appointment is neither made ineffective nor
discharged within 60 days after the making thereof,
or such appointment is consented to, requested by,
or acquiesced in by the Manager; or
(e) The Manager commences a voluntary case under
any applicable bankruptcy, insolvency or similar
law now or hereafter in effect; or consents to the
entry of an order for relief in an involuntary case
under any such law or to the appointment of or
taking possession by a receiver, liquidator,
assignee, custodian, trustee, sequestrator or other
similar official of any substantial part of its
assets; or makes a general assignment for the
benefit of creditors; or fails generally to pay its
or Company debts as such debts become due; or takes
corporate or other action in furtherance of any of
the foregoing; or
(f) Entry is made against the Manager of a
judgment, decree or order for relief affecting a
substantial part of its assets by a court of
competent jurisdiction in an involuntary case
commenced under any applicable bankruptcy,
insolvency or other similar law of any jurisdiction
now or hereafter in effect.
9.5 Payments To Manager. The Manager shall be
compensated for its services and reimbursed for its
costs hereunder in accordance with the Accounting
Procedure.
9.6 Transactions With Affiliates. If the Manager
engages Affiliates to provide services hereunder
including, without limitation, services relating to
milling or beneficiating Products, it shall do so
on terms no less favorable to the Company than
would be the case with unrelated persons in arm's-
length transactions.
9.7 Activities During Deadlock. Subject to the
contrary direction of the Management Committee and
to the receipt of necessary funds, if the
Management Committee for any reason fails to adopt
a Program and Budget, the Manager shall continue
Operations at levels comparable with the last
adopted Program and Budget but in no event at
levels which do not fully provide for the minimum
holding costs of the Properties
ARTICLE X
PROGRAMS AND BUDGETS
10.1 Operations Pursuant to Programs and Budgets.
Operations shall be conducted, expenses shall be
incurred, and Assets shall be acquired only
pursuant to adopted Programs and Budgets.
10.2 Presentation of Programs and Budgets. Proposed
Programs and Budgets shall be prepared by the
Manager for a period of one (1) year or any longer
period. Each adopted Program and Budget,
regardless of length, shall be reviewed at least
once a year at the annual meeting of the Management
Committee. During the period encompassed by any
Program and Budget, and at least two months prior
to its expiration, a proposed Program and Budget
for the succeeding period shall be prepared by the
Manager and submitted to the Members.
10.3 Review and Adoption of Proposed Programs and
Budgets. Within thirty (30) days after submission
of a proposed Program and Budget, or a proposed
Amendment thereto under Section 10.9, each Member
shall submit in writing to the Management
Committee:
(a) Notice that the Member approves any or all of
the components of the proposed Program and Budget;
or
(b) Modifications proposed by the Member to the
components of the proposed Program and Budget; or
(c) Notice that the Member rejects any or all of
the components of the proposed Program and Budget.
If a Member fails to give any of the foregoing
responses within the allotted time, the failure
shall be deemed to be a vote by the Member for
adoption of the Manager's proposed Program and
Budget. If a Member makes a timely submission to
the Management Committee pursuant to Subsections
10.4(a), (b) or (c), then the Management Committee
shall consult regarding the possible development of
a Program and Budget acceptable to all Members
(provided that no Member shall be obligated to
agree to any actual change to a proposed Program
and Budget in connection with such consultations)
failing which the Management Committee shall
determine a Program and Budget by majority vote of
Ownership Interests.
10.4 Emergency or Unexpected Expenditures. In case
of emergency, the Manager may take any reasonable
action it deems necessary to protect life, limb or
property, to protect the Assets or to comply with
Environmental Laws or other Laws. The Manager may
make reasonable expenditures for unexpected events
which are beyond its reasonable control and which
do not result from a breach by it of its standard
of care. The Manager shall promptly notify the
Members of the emergency or unexpected expenditure,
and the Manager shall be reimbursed for all
resulting costs by the Members in the same manner
and with the same consequences and effects as the
Members provided the funding for the then current
Program and Budget.
10.5 Amendments to Programs and Budgets. An adopted
Program and Budget may be amended by the Manager
(the Amendment) upon 30 days notice. The
procedures for review and approval of proposed
Amendments under this Section 10.5 shall be the
same as the procedures for the review and approval
of proposed Budgets and Programs under Section
10.3.
ARTICLE XI
ACCOUNTS AND SETTLEMENTS
11.1 Monthly Statements. The Manager shall promptly
submit to the Management Committee monthly
statements of account reflecting in reasonable
detail the charges and credits to the Business
Account during the preceding month.
11.2 Cash Calls. On the basis of each adopted or
amended Program and Budget and subject to Section
10 of this Agreement and Section 2.2 of the
Members' Agreement as Amended, the Manager shall
submit to each Member, a billing (or cash call) for
estimated cash requirements for each month during
the term of such Program. Within ten (10) days
after receipt of each such billing, each Member
shall pay to the Manager its share of such
estimated requirements. Time is of the essence of
payment of such xxxxxxxx. The Manager shall at all
times maintain a reasonable working capital
reserve. All funds reasonably in excess of
immediate cash requirements may be invested in
interest-bearing accounts with the Company's bank,
for the benefit of the Business Account.
11.3 Failure to Meet Cash Calls. A Member that
fails to meet cash calls in the amount and at the
times specified in Section 11.2 shall be in
default, and the amounts of the defaulted cash call
shall bear interest from the date due at an annual
rate equal to the Interest Rate, but in no event
shall said rate of interest exceed the maximum
permitted by Law.
11.4 Audits. Unless waived by all Members in
writing, the Manager shall order an audit of the
accounting and financial records for each calendar
year (or other mutually agreed accounting period).
All written exceptions to and claims upon the
Manager for discrepancies disclosed by such audit
shall be made not more than 3 months after receipt
of the audit report. Failure to make any such
exception or claim within the 3-month period shall
mean the audit is correct and binding upon the
Members. The audits shall be conducted by a firm
of certified public accountants selected by the
Manager, unless otherwise agreed by the Management
Committee.
ARTICLE XII
PROPERTIES; DISTRIBUTION OF PRODUCTION
12.1 Royalties, Production Taxes and Other Payments
Based on Production. All required payments of
production royalties, taxes based on production of
Products, and other payments out of production to
private parties and governmental entities, shall be
determined and made by the Company in a timely
manner and otherwise in accordance with applicable
laws and agreements. The Manager shall furnish to
the Members evidence of timely payment for all such
required payments. In the event the Company fails
to make any such required payment, any Member shall
have the right to make such payment and shall
thereby become subrogated to the rights of such
third party; provided, however, that the making of
any such payment on behalf of the Company shall not
constitute acceptance by the paying Member of any
liability to such third party for the underlying
obligation.
12.2 Abandonment and Surrender. Either Member may
request the Management Committee to authorize the
Manager to surrender or abandon part or all of the
Properties. If the other Member objects to such
surrender or abandonment, then at the option of the
objecting Member, the Company shall assign to the
objecting Member or such other Person as the
objecting Member specifies, by special warranty
deed and without cost to the surrendering Member,
all of the Company's interest in the Properties
sought to be abandoned or surrendered, free and
clear of all Encumbrances created by, through or
under the Company or the surrendering Member, other
than those to which both Members have agreed. Upon
the assignment, such properties shall cease to be
part of the Properties.
12.3 Reacquisition. If any Properties are abandoned
or surrendered under the provisions of this Article
XII, then, unless this Agreement is earlier
terminated, neither Member nor any Affiliate
thereof shall acquire any interest in such
Properties or a right to acquire such Properties
for a period of two years following the date of
such abandonment or surrender. If a Member
reacquires any Properties in violation of this
Section 12.3, the other Member may elect by notice
to the reacquiring Member within 45 days after it
has actual notice of such reacquisition, to have
such properties made subject to the terms of this
Agreement and transferred, without charge, to the
Company. In the event such an election is made,
the reacquired properties shall thereafter be
treated as Properties, and the costs of
reacquisition shall be borne solely by the
reacquiring Member and shall not be included for
purposes of calculating the Members' respective
Ownership Interests.
12.4 Disposition of Products by Manager. The
Manager shall market and dispose of Products. Such
dispositions by Manager shall be in good faith and
in accordance with good industry practice, with the
objective of obtaining the best possible price for
the Products. The Manager shall have the right to
enter into forward sales and hedging arrangements
as approved by the Management Committee.
ARTICLE XIII
CONFIDENTIALITY, OWNERSHIP, USE
AND DISCLOSURE OF INFORMATION
13.1 Business Information. All Business Information
shall be owned jointly by the Members as their
Ownership Interests are determined pursuant to this
Agreement. Both before and after the termination of
the Company, all Business Information may be used
by either Member for any purpose, whether or not
competitive with the Business, without consulting
with, or obligation to, the other Member. Each
Member shall keep confidential and not disclose to
any third party or the public any portion of the
Business Information that constitutes Confidential
Information.
13.2 Disclosure Required By Law. Notwithstanding
anything contained in this Article, a Member may
disclose any Confidential Information if, in the
opinion of the disclosing Member's legal counsel:
(a) such disclosure is legally required to be made
in a judicial, administrative or governmental
proceeding pursuant to a valid subpoena or other
applicable order; or (b) such disclosure is legally
required to be made pursuant to State or Federal
Securities Laws or the rules or regulations of a
stock exchange or similar trading market applicable
to the disclosing Member.
Prior to any disclosure of Confidential Information
under this Section 13.2, the disclosing Member
shall give the other Member at least three (3)
business days prior written notice (unless less
time is permitted by such rules, regulations or
proceeding) and, in making such disclosure, the
disclosing Member shall disclose only that portion
of Confidential Information required to be
disclosed and shall take all reasonable efforts to
preserve the confidentiality thereof, including,
without limitation, obtaining protective orders and
supporting the other Member in intervention in any
such proceeding.
13.3 Public Announcements. Prior to making or
issuing any press release or other public
announcement or disclosure of Business Information
that is not Confidential Information, a Member
shall first consult with the other Member as to the
content and timing of such announcement or
disclosure, unless in the good faith judgment of
such Member, there is not sufficient time to
consult with the other Member before such
announcement or disclosure must be made under
applicable Laws; but in such event, the disclosing
Member shall notify the other Member, as soon as
possible, of the pendency of such announcement or
disclosure, and it shall notify the other Member
before such announcement or disclosure is made if
at all reasonably possible. Any press release or
other public announcement or disclosure to be
issued by either Member relating to this Business
shall also identify the other Member.
13.4 Duration of Confidentiality. The provisions of
this Article XIII shall apply during the term of
this Agreement and for two years following
termination of this Agreement pursuant to Section
14.1, and shall continue to apply to any Member who
withdraws, who is deemed to have withdrawn, or who
Transfers its Ownership Interest, for two years
following the date of such occurrence.
ARTICLE XIV
DISSOLUTION
14.1 Events of Dissolution. The Company shall be
dissolved upon the occurrence of any of the
following:
(a) Upon expiration of term of the Company in
accordance with Section 2.5;
(b) Upon the unanimous written agreement of the
Members; or
(c) as otherwise provided by the Act.
14.2 Resignation. A Member may elect to resign from
the Company
(a) as set forth in the Members' Agreement as
Amended.
14.3 Disposition of Assets on Dissolution. Promptly
after dissolution under Section 14.1, the Manager
shall take all action necessary to wind up the
activities of the Company, in accordance with
Exhibit C. All costs and expenses incurred in
connection with the dissolution of the Company
shall be expenses chargeable to the Business
Account.
14.4 Filing of Certificate of Cancellation. Upon
completion of the winding up of the affairs of the
Company, the Manager shall promptly file a
Certificate of Cancellation with the Office of the
Secretary of State of the State of Delaware. If the
Manager has caused the dissolution of the Company,
whether voluntarily or involuntarily, then a person
selected by a majority vote of the Members to wind
up the affairs of the Company shall file the
Certificate of Cancellation.
14.5 Right to Data After Dissolution. After
dissolution of the Company pursuant to Subsections
14.1(a), (b), or (c), each Member shall be entitled
to make copies of all applicable information
acquired hereunder before the effective date of
termination not previously furnished to it.
14.6 Continuing Authority. On dissolution of the
Company under Section 14.1 the Member that was the
Manager or that appointed the Manager prior to such
dissolution (or the other Member in the event of a
resignation by the Manager) shall have the power
and authority to do all things on behalf of both
Members that are reasonably necessary or convenient
to: (a) wind up Operations (b) complete
reclamation, closure and other Environmental
Compliance activities with respect to the
Properties, and (c) complete any transaction and
satisfy any obligation, unfinished or unsatisfied,
at the time of such dissolution,, if the
transaction or obligation arises out of Operations
prior to such dissolution, . The Manager shall have
the power and authority to grant or receive
extensions of time or change the method of payment
of an already existing liability or obligation,
prosecute and defend actions on behalf of the
Company and either or both Members, encumber
Assets, and take any other reasonable action in any
matter with respect to which the former Members
continue to have, or appear or are alleged to have,
a common interest or a common liability.
ARTICLE XV
GOVERNING LAW
15.1 Governing Law. Except for matters of title to
the Assets or their Transfer, which shall be
governed by the law of their situs, this Agreement
shall be governed by and interpreted in accordance
with the laws of the State of Delaware, without
regard for any conflict of laws or choice of laws
principles that would permit or require the
application of the laws of any other jurisdiction.
ARTICLE XVI
GENERAL PROVISIONS
16.1 Notices. All notices, payments and other
required or permitted communications (Notices) to
either Member shall be in writing, and shall be
addressed respectively as follows:
If to TSVLP:
Tonkin Springs Venture Limited Partnership
0000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxx, President
Tonkin Springs Gold Mining Company,
General Partner
Telephone:(000)000-0000
Facsimile: (000) 000-0000
If to USEC:
U.S. Environmental Corporation
0000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxx X. Xxxx, President
Telephone: (000)000-0000
Facsimile: (000)000-0000
All Notices shall be given (a) by personal delivery
to the Member, (b) by electronic communication,
capable of producing a printed transmission and
confirmation, (c) by registered or certified mail
return receipt requested, or (d) by overnight or
other express courier service. All Notices shall be
effective and shall be deemed given on the date of
receipt at the principal address if received during
normal business hours, and, if not received during
normal business hours, on the next business day
following receipt, or if by electronic
communication, on the date of such communication.
Either Member may change its address by Notice to
the other Member.
16.2 Gender. The singular shall include the plural,
and the plural the singular wherever the context so
requires, and the masculine, the feminine, and the
neuter genders shall be mutually inclusive.
16.3 Currency. All references to dollars or $
herein shall mean lawful currency of the United
States of America.
16.4 Headings. The subject headings of the Sections
and Subsections of this Agreement and the
Paragraphs and Subparagraphs of the Exhibits to
this Agreement are included for purposes of
convenience only, and shall not affect the
construction or interpretation of any of its
provisions. References to hereunder are, unless
otherwise stated, references to this entire
Agreement.
16.5 Waiver. The failure of either Member to insist
on the strict performance of any provision of this
Agreement or to exercise any right, power or remedy
upon a breach hereof shall not constitute a waiver
of any provision of this Agreement or limit such
Member's right thereafter to enforce any provision
or exercise any right.
16.6 Modification. No modification of this
Agreement shall be valid unless made in writing and
duly executed by both Members.
16.7 Force Majeure. Except for the obligation to
make payments when due hereunder, the obligations
of a Member shall be suspended to the extent and
for the period that performance is prevented by any
cause, whether foreseeable or unforeseeable, beyond
its reasonable control, including, without
limitation, labor disputes (however arising and
whether or not employee demands are reasonable or
within the power of the Member to grant); acts of
God; Laws, instructions or requests of any
government or governmental entity; judgments or
orders of any court; inability to obtain on
reasonably acceptable terms any public or private
license, permit or other authorization; curtailment
or suspension of activities to remedy or avoid an
actual or alleged, present or prospective violation
of Environmental Laws; action or inaction by any
federal, state or local agency that delays or
prevents the issuance or granting of any approval
or authorization required to conduct Operations
(including, without limitation, a failure to
complete any review and analysis required by the
National Environmental Policy Act or any similar
state law); acts of war or conditions arising out
of or attributable to war, whether declared or
undeclared; riot, civil strife, insurrection or
rebellion; fire, explosion, earthquake, storm,
flood, sink holes, drought or other adverse weather
condition; delay or failure by suppliers or
transporters of materials, parts, supplies,
services or equipment or by contractors' or
subcontractors' shortage of, or inability to
obtain, labor, transportation, materials,
machinery, equipment, supplies, utilities or
services; accidents; breakdown of equipment,
machinery or facilities; actions by native rights
groups, environmental groups, or other similar
special interest groups; or any other cause whether
similar or dissimilar to the foregoing. The
affected Member shall promptly give notice to the
other Member of the suspension of performance,
stating therein the nature of the suspension, the
reasons therefore, and the expected duration
thereof. The affected Member shall resume
performance as soon as reasonably possible. During
the period of suspension the obligations of both
Members to advance funds pursuant to this Agreement
shall be reduced to levels consistent with then
current Operations.
16.8 Rule Against Perpetuities. The Members do not
intend that there shall be any violation of the
rule against perpetuities, the rule against
unreasonable restraints on the alienation of
property, or any similar rule. Accordingly, if any
right or option to acquire any interest in the
Properties or Assets, in an Ownership Interest, or
the Company, or in any real property exists under
this Agreement, such right or option must be
exercised, if at all, so as to vest such interest
within time periods permitted by applicable rules.
If, however, any such violation should
inadvertently occur, the Members hereby agree that
a court shall reform that provision in such a way
as to approximate most closely the intent of the
Members within the limits permissible under such
rules.
16.9 Further Assurances. Each of the Members shall
take, from time to time and without additional
consideration, such further actions and execute
such additional instruments as may be reasonably
necessary or convenient to implement and carry out
the intent and purposes of this Agreement or as may
be reasonably required by lenders in connection
with Project Financing.
16.10 Entire Agreement; Successors and Assigns.
This Agreement contains the entire understanding of
the Members and supersedes all prior agreements and
understandings between the Members relating to the
subject matter hereof. This Agreement shall be
binding upon and inure to the benefit of the
respective successors and permitted assigns of the
Members.
16.11 Counterparts. This Agreement may be executed
in any number of counterparts, and it shall not be
necessary that the signatures of both Members be
contained on any counterpart. Each counterpart
shall be deemed an original, but all counterparts
together shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have
executed this Agreement as of the Effective Date.
TONKIN SPRINGS VENTURE LIMITED PARTNERSHIP
By: Tonkin Springs Gold Mining Company,
as its General Partner
By:/s/Xxxxxxx X. Xxxx, President
By: U.S. ENVIRONMENTAL CORPORATION
By:/s/Xxxxx X. Xxxx, President
Exhibit 10.14
Technical Services Agreement dated December 18,
2001 between Tonkin Springs Holding Inc., Tonkin
Springs Venture Limited Partnership and Tonkin
Springs LLC, and Xxxxxxx Xxxxxxxxx & Xxxxxxx
(U.S.), Inc.
TECHNICAL SERVICES AGREEMENT
THIS TECHNICAL SERVICES AGREEMENT (this Agreement)
is made and entered into effective as of December
18, 2001, by and between TONKIN SPRINGS HOLDINGS,
INC., whose address is 000 Xxx Xxxxxx, Xxxxx 0000,
Xxxxxxx, Xxxxxxx X0X 0X0, XXXXXX (TSHI), TONKIN
SPRINGS LLC, whose address is 0000 Xxxxxxx Xxxxxx,
Xxxxx 000, Xxxxxxxx, Xxxxxxxx 00000 (Tonkin Springs
LLC) and XXXXXXX XXXXXXXXX & XXXXXXX (U.S.), INC.,
whose address is 0000 X. Xxxxxxxxx Xxxxxx, Xxxxx
0000, Xxxxxxxx, Xxxxxxxx 00000 (SRK).
RECITALS
WHEREAS, TSHI and the Nevada Division of
Environmental Protection (NDEP) entered into that
certain TSP-1 WORK PLAN AGREEMENT dated as of
November 30, 2001 (the NDEP Agreement), which
contemplates a work program to locate, plug and
properly abandon specific, historic, i.e. pre-1990,
boreholes at the TSP-1 area of the Tonkin Springs
project in Eureka County, Nevada. A copy of the
NDEP Agreement is appended to this Agreement as
Exhibit A. A copy of the work program approved by
the NDEP (the Work Plan), including a list of the
specific boreholes covered by the Work Plan, is
appended to the NDEP Agreement;
WHEREAS, TSHI and Tonkin Springs LLC (the owner of
the Tonkin Springs project) and Tonkin Springs
Venture Limited Partnership (TSVLP, the Manager of
Tonkin Springs LLC) entered into a Settlement
Agreement dated as of October 31, 2001 (the
Settlement Agreement), which also contemplates the
performance of the Work Plan and other matters. A
copy of the Settlement Agreement is appended to
this Agreement as Exhibit B;
WHEREAS, pursuant to the NDEP Agreement and the
Settlement Agreement: (i) the Work Plan is to be
conducted on behalf of Tonkin Springs LLC but
administered by and conducted under the direction
of SRK; and (ii) the Work Plan is to be paid for
out of the sum of $250,000 which TSHI has placed in
escrow (the Escrow) with the Xxxxx Fargo Bank
Arizona, N.A. (the Escrow Agent). A copy of the
Escrow Instructions from TSHI to the Escrow Agent
are appended to this Agreement as Exhibit C; and
WHEREAS, TSHI, Tonkin Springs LLC and SRK desire to
enter into this Agreement in order to provide for
the performance of the Work Plan on behalf of
Tonkin Springs LLC under the direction and control
of SRK, for payment for such services and for
certain related matters.
NOW, THEREFORE, in consideration of the covenants,
obligations, terms and conditions set forth in this
Agreement, TSHI, Tonkin Springs LLC and SRK agree
as follows:
Scope of Services.
SRK shall implement, carry out, control, direct and
make best efforts to complete the Work Plan. In
accordance with Section 6.1 of this Agreement, SRK
will, as agent on behalf of Tonkin Springs LLC,
hire contractors (Contractors) to perform earth
moving, surveying and drilling in connection with
performance of the Work Plan. SRK shall supervise,
control and direct all work conducted under this
Agreement (the Work), including without limitation
all Work performed by the Contractors. SRK shall
perform all Work, and shall ensure that the
Contractors perform all Work, in strict accordance
with the Work Plan. SRK shall ensure that all Work
is conducted in a good, workmanlike and safe
manner, in as expeditious a manner as reasonably
practicable and in accordance with all requirements
of applicable law and regulations. Additionally,
SRK shall ensure that the total cost of all Work
does not exceed the sum of $250,000. Not more than
$250,000 will be expended upon the Work Plan,
regardless of results. TSHI and Tonkin Springs LLC
acknowledge that the implementation of the Work
Plan may not result in the elimination of acid
generation in full and that additional mitigation
steps outside the scope of the Work Plan may be
necessary to eliminate acid generation to achieve
full compliance with the regulatory requirements of
the NDEP.
Upon contract execution, SRK shall provide twice
monthly written progress reports to the NDEP, with
copies to TSHI and Tonkin Springs LLC, concerning
implementation of the Work Plan. In the event that
SRK determines that it cannot complete the Work
Plan by June 30, 2002, SRK shall immediately
provide the NDEP, TSHI and Tonkin Springs LLC with
written notification of such determination,
together with SRK's best estimate as to the
completion date. Within 30 days after completion
of the Work Plan, SRK shall provide to TSHI and
Tonkin Springs LLC, for their review and comment, a
written draft of a summary completion report. The
summary completion report shall include, at a
minimum, the following: (i) a certification that
the Work Plan has been completed; (ii) a summary of
all activities included in the Work Plan; (iii) a
summary of holes staked out, located and not
located; (iv) a list of and supporting abandonment
reports for all holes abandoned; (v) a map
graphically depicting the holes that were staked
out, located, not located, and abandoned; (vi)
supporting documentation for holes not located,
including a photographic record of the excavation
bottom or a signed geotechnical log of the
excavation; and (vii) any deviations from the Work
Plan and rationale for such deviations, provided
that SRK shall not deviate from the Work Plan
except with specific, prior written consent of each
of TSHI and Tonkin Springs LLC, which consent shall
not be unreasonably withheld. Within 45 days after
completion of the Work Plan, SRK shall submit the
finalized summary completion report to the NDEP,
with copies of that report to both TSHI and Tonkin
Springs LLC. With respect to all reports to be
provided by SRK to TSHI and Tonkin Springs LLC
pursuant to this Agreement, SRK shall transmit
those reports to those parties simultaneously.
Each of TSHI and Tonkin Springs LLC will have the
right to have a representative on-site to observe
the conduct and performance of all or any portion
of the Work and to provide any comments or
suggestions with respect thereto to SRK, provided
that: (i) comments and suggestions will be provided
only to the designated representative of SRK and
not to any of the Contractors or any other
employees of SRK; and (ii) it is understood by all
parties that the Work Plan will be carried out
under the exclusive direction and control of SRK
and that SRK shall make all final decisions as to
the manner of performance and implementation of the
Work Plan. For purposes of this Section 1.3: (i)
Tonkin Springs LLC designates Mr. Xxxxx Xxxx as its
designated representative; (ii) TSHI designates
Xxxxxxx Xxxxxxxx as its designated representative;
and (iii) SRK designates Xxxxx Xxxxx as its
designated representative.
Compensation and Terms of Payment.
SRK will submit monthly invoices to the Escrow
Agent for Work that has been conducted pursuant to
the Work Plan, with reasonable documentation
evidencing the performance of the Work. SRK will
approve and forward invoices of any Contractors
hired by SRK on behalf of Tonkin Springs LLC to the
Escrow Agent. SRK will simultaneously provide
copies of their own and Contractors' invoices and
supporting documentation to each of TSHI and Tonkin
Springs LLC. SRK will not submit to the Escrow
Agent invoices covering Work performed by it or by
Contractors, nor shall the Escrow Agent pay such
invoices, unless and until SRK has obtained and
provided to TSHI and Tonkin Springs LLC lien
releases or waivers from SRK and/or the Contractors
who performed such Work, as well as written
releases of Tonkin Springs LLC and TSHI from any
contractual or any other liability for payment with
respect to such Work. In accordance with the
Escrow Instructions, the Escrow Agent will pay
SRK's and Contractors' invoices on the eleventh day
after its receipt thereof from SRK, unless TSHI
first provides the Escrow Agent with a written
objection instructing the Escrow Agent not to pay
such invoice. In that event, TSHI and SRK shall
promptly consult in order to resolve any problems
or discrepancies with respect to the invoice and,
upon reaching such a resolution, TSHI shall
instruct the Escrow Agent to pay the invoice, as
the same may have been corrected or modified.
Upon completion of the Work Plan, SRK shall submit
its final invoice, clearly marked as such, to the
Escrow Agent, with copies to TSHI and Tonkin
Springs LLC as set forth in Section 2.1 above.
Such invoice shall not be paid by the Escrow Agent
unless and until SRK has provided TSHI and Tonkin
Springs LLC with lien releases or waivers, and
contractual and other payment liability releases of
Tonkin Springs LLC and TSHI from SRK and all
Contractors involved in the performance of the
Work.
SRK shall charge for Work performed by it in
accordance with the attached SRK Standard Schedule
of Fees.
Invoices shall be organized on an item-by-item
basis and shall itemize the charges for each item
or portion of the Work performed. SRK shall
include a summary of actual hours worked on the
project by SRK's professional and technical
employees, by classification and hourly rate.
Direct, nonsalary, reimbursable expenses, and other
direct costs and expenses, shall be itemized
separately in each invoice. SRK shall furnish
copies of time sheets, expense reports, vendor
invoices, and other documentation necessary to
substantiate each invoice, at the request of either
TSHI or Tonkin Springs LLC.
SRK, TSHI and Tonkin Springs LLC acknowledge, agree
and understand that, notwithstanding anything in
this Agreement to the contrary: (i) there is only
the Escrow sum of $250,000 available for payment
for the Work (the Budget); (ii) part of the
services being provided by SRK is to ensure that
performance of the Work Plan does not exceed this
Budget; (iii) SRK will not perform any Work, or
contract for the performance of any Work by
Contractors, if the performance of such Work would
result in cost overruns in excess of the Budget,
except with the express and specific prior written
authorization of TSHI; and (iv) under no
circumstances will TSHI be obligated under this
Agreement to fund any amount in excess of the sum
of $250,000 which it has already placed in Escrow,
unless TSHI has provided the authorization
described in (iii) above. The parties further
acknowledge, agree and understand that TSHI's role
under this Agreement and in connection with the
Work Plan is purely financial (i.e. in connection
with the funding and administration of the Escrow)
and that it shall not direct or control the
performance of the Work Plan, it being understood
that it shall be SRK's exclusive responsibility to
direct and control the performance of the Work
Plan.
Confidential Information.
SRK recognizes and acknowledges that it will have
access to and may develop or become aware of
certain information of Tonkin Springs LLC, TSHI or
their respective affiliates (collectively, Tonkin
Entities) and that such information constitutes
confidential information of the Tonkin Entities.
SRK shall not, during or after the term of this
Agreement, use or disclose directly or indirectly
any such confidential information to any person,
firm, corporation, association, or other entity,
except to Contractors engaged by SRK and to
authorized representatives of the Tonkin Entities,
for any reason or purpose whatsoever without the
Tonkin Entities' prior written approval. SRK
represents that it has entered into agreements with
all of its employees requiring them not to disclose
any such information. Only employees with a
demonstrable need to know will be given access to
information collected or developed under this
Agreement. In the event of a breach or threatened
breach by SRK of the provisions of this Section 3,
the Tonkin Entities shall be entitled to a
temporary restraining order or a preliminary
injunction restraining SRK from using or
disclosing, in whole or in part, such confidential
information, and SRK consents to the entry of such
a temporary restraining order or preliminary
injunction without the necessity of the Tonkin
Entities posting any bond in connection therewith
and agrees that it shall not assert any defenses to
any petition filed by the Tonkin Entities in a
court of competent jurisdiction requesting such
temporary restraining order and/or preliminary
injunction, as the case may be. Nothing herein
shall be construed as prohibiting the Tonkin
Entities and its affiliates from pursuing any other
remedies available to them for such breach or
threatened breach, including the recovery of
damages from SRK. The provision of this Section 3
shall survive the dissolution or termination of
this Agreement.
The obligations of this Section 3 do not apply to
information which: (a) is or becomes part of the
public domain without the breach of any obligation
of confidentiality owed to the Tonkin Entities; or
(b) is lawfully in the possession of SRK at the
time it was acquired hereunder without the breach
of any obligation of confidentiality owned to the
Tonkin Entities; or (c) is required by law to be
disclosed.
In the event SRK receives any legal process
purporting to require the production of
confidential information to any court, agency,
other tribunal, person, or entity, SRK shall
immediately notify the Tonkin Entities, provide the
Tonkin Entities with a copy of such legal process,
and cooperate with the Tonkin Entities in any legal
proceeding arising therefrom.
Except for the reports and documents expressly
required to be provided to the NDEP pursuant to
Section 1 of this Agreement, SRK shall not
communicate with governmental agencies concerning
the Work or concerning SRK's or Contractors'
performance of the Work without obtaining the prior
approval of TSHI and Tonkin Springs LLC.
Any reports, documents, or other information,
regardless of form, that is collected or developed
by SRK pursuant to this Agreement shall be
exclusively the property of TSHI and Tonkin Springs
LLC and all such reports, documents, or
information, and any copies thereof shall be turned
over to TSHI and Tonkin Springs LLC at the
conclusion of the Work, unless TSHI and Tonkin
Springs LLC shall sooner request same. SRK may
retain one hard copy of such documents for record
purposes. Reuse of such documents by TSHI or
Tonkin Springs LLC for other than the project
covered by this Agreement shall be without
liability to SRK.
Termination.
The Agreement may be terminated at any time for
good cause by mutual written notice of termination
from TSHI and Tonkin Springs LLC to SRK. Such
termination shall be effective in the manner
specified in the notice, shall be without prejudice
to any claims which TSHI or Tonkin Springs LLC may
have against SRK, and shall be subject to the other
provisions of this Agreement. On receipt of such
notice, except to the extent otherwise directed,
SRK shall immediately discontinue the Work and the
placing of Contractor orders for materials,
facilities, services and supplies in connection
with the performance of the services and shall, if
requested, make every reasonable effort to procure
termination of existing contracts with Contractors
upon terms satisfactory to TSHI and Tonkin Springs
LLC. Thereafter, SRK shall be authorized to do
only such Work as may be necessary to preserve and
protect the services already in progress and as
otherwise requested by TSHI and Tonkin Springs LLC.
A complete settlement of all claims of SRK upon
termination of the Agreement, as provided in the
preceding paragraph, shall be made as follows:
SRK shall within ten (10) days invoice the Escrow
Agent for all obligations and commitments that SRK
may have in good faith undertaken or incurred in
connection with the services which have not been
included in prior payments; for the reasonable cost
of terminating existing contracts; for preserving,
protecting, or disposing of property and performing
any other necessary services after the notice of
termination has been received; and for all services
performed prior to the date of termination, in
accordance with this Agreement. SRK shall
simultaneously provide copies of such invoices,
together with all supporting documents evidencing
the performance of the Work at issue, to TSHI and
Tonkin Springs LLC in accordance with the
provisions of Section 2 above.
The Escrow Agent shall pay SRK in accordance with
and subject to the provisions of Section 2 above.
Upon final settlement, SRK shall deliver to TSHI
and Tonkin Springs LLC all reports, documents,
drafts, notes, and all other information and data
collected or prepared by SRK under this Agreement
and deliver to TSHI and Tonkin Springs LLC lien
releases or waivers, and contractual and other
payment liability releases of Tonkin Springs LLC
and TSHI, from SRK and all Contractors involved in
the performance of the Work.
Parties' Representations, Warranties, and
Responsibilities.
SRK represents and warrants to TSHI and Tonkin
Springs LLC that it has the authority to enter into
this Agreement and to perform the Work and that it
is licensed, certified and/or otherwise authorized
to practice in the area of engineering and so
licensed and certified to conduct business in the
State of Nevada. SRK further represents and
warrants that all Work performed by it hereunder
will be: (a) in conformance with the terms of this
Agreement; (b) performed in a skillful and
workmanlike manner in accordance with appropriate
industry standards; (c) performed by the proper
number of experienced, skilled, and/or licensed
personnel, qualified by education and experience to
perform their assigned tasks; and (d) performed in
accordance with the standards customarily provided
by an experienced and competent professional
technical consulting organization rendering the
same or similar services. SRK covenants that the
Contractors shall meet these standards and that the
contracts with the Contractors shall contain these
representations and warranties.
SRK agrees to indemnify and hold TSHI, TSVLP and
Tonkin Springs LLC (and their shareholders,
members, managers, officers, principles, employees
and agents) harmless from and against any and all
losses, damages, costs, penalties, expenses
(including, but not limited to, reasonable costs of
investigation and legal expenses), liabilities,
judgments, liens, suits, claims or demands arising
out of any actual or threatened damage to property,
including property of TSHI, TSVLP or Tonkin Springs
LLC or injuries to or death of persons, including
employees of TSHI, TSVLP or Tonkin Springs LLC
arising from SRK's willful misconduct or negligent
acts or omissions in connection with the Work, or
any breach or threatened breach of this Agreement
by SRK, excluding and to the extent of, the
negligence or willful misconduct of TSHI, TSVLP or
Tonkin Springs LLC. SRK shall require that all
contracts with Contractors provide the
indemnifications provided by SRK in this Section
5.2.
TSHI agrees to indemnify, defend and hold harmless
SRK (and its officers, employees, and agents)
against any and all claims, demands, suits,
judgments, expenses, losses and damages, or injury
to, or death of persons and for destruction of or
damages to any property of SRK resulting directly
from TSHI's (or its employees or agents) negligence
or willful misconduct, except to the extent that
any such expenses, losses or damages are
attributable to the negligence or willful
misconduct of SRK, its employees, agents, or the
Contractors.
Tonkin Springs LLC agrees to indemnify, defend and
hold harmless SRK (and its officers, employees, and
agents) against any and all claims, demands, suits,
judgments, expenses, losses and damages, or injury
to, or death of persons and for destruction of or
damages to any property of SRK resulting directly
from Tonkin Springs LLC's (or its employees or
agents) negligence or willful misconduct, except to
the extent that any such expenses, losses or
damages are attributable to the negligence or
willful misconduct of SRK, its employees, agents,
or the Contractors.
Notwithstanding paragraph 5.2, SRK shall assume all
responsibility for and shall indemnify and hold
harmless TSHI, TSVLP and Tonkin Springs LLC and
each of their affiliates, against, and shall assume
the defense of any claims, suits, or judgment
brought against any of them under the Federal
Employers Liability Act whenever employees of SRK
or any of the Contractors claim or allege that they
are employees of TSHI, TSVLP or Tonkin Springs LLC
or their affiliates, within the meaning of said
act, or that they are furthering operational
activities of TSHI, TSVLP or Tonkin Springs LLC or
their affiliates.
In no event shall SRK, TSHI or Tonkin Springs LLC
be liable to each other for lost revenues, lost
profits, cost of capital, claims of instances or
any special, indirect, incidental, or consequential
or punitive damages pursuant to this Agreement.
SRK promptly shall pay all wages due its workmen
and employees required for the Work. SRK shall
defend and protect Tonkin Springs LLC and TSHI from
and against all claims, liens and liabilities which
may arise as a result of SRK's failure to do so or
the failure of any of the Contractors to pay their
workmen or employees. If at any time there should
be evidence of any lien, claim or encumbrance for
which, or to which, Tonkin Springs LLC, TSHI, the
Tonkin Springs project property or the production
therefrom, is or might become subject or liable and
which are: (i) attributable to labor, materials,
supplies, equipment or services furnished to or
required by any of the Contractors or SRK or any of
their suppliers or vendors, or any other persons or
entity for use on or in conjunction with those
properties or SRK's or the Contractors' activities
thereon; or (ii) attributable to payroll,
withholding or other taxes or other indebtedness,
resulting from or in connection with SRK's or any
of the Contractors' work or operations in
connection with the Work, SRK shall, upon demand by
Tonkin Springs LLC or TSHI, immediately cause the
release of such lien or pay such claim and deliver
to Tonkin Springs LLC and TSHI a complete release
or receipt satisfactory to Tonkin Springs LLC and
TSHI discharging such lien, claim or encumbrance.
Tonkin Springs LLC and/or TSHI at any time may pay
and discharge such liens, claims and encumbrances,
in which event SRK shall be obligated to
immediately reimburse the paying party or parties
in the amount so paid, together with reasonable
costs and attorneys fees incurred by the paying
party or parties.
If TSHI instructs the Escrow Agent pursuant to
paragraph 2.1 above not to pay an invoice submitted
by SRK or a Contractor for Work performed under
this Agreement when there are sufficient funds in
the Escrow Account to pay that invoice, and SRK or
the Contractor files a lien against any part of the
Tonkin Springs project property with respect to
Work covered by that invoice, TSHI shall have no
liability to Tonkin Springs LLC to secure the
release of that lien unless TSHI acted unreasonably
in so instructing the Escrow Agent. If TSHI acted
unreasonably in so instructing the Escrow Agent, it
shall be obligated to secure the release of that
lien, provided, however, that (a) TSHI's liability
to Tonkin Springs LLC and the lien holder (whether
SRK or a Contractor) with respect to the lien shall
be limited to the amount of the lien, (b) the
amount of the lien shall be paid, upon a
determination that TSHI acted unreasonably or upon
TSHI's subsequent election (in its sole discretion)
to authorize the Escrow Agent pay the lien, solely
from the Escrow Account, and (c) TSHI shall have no
liability to Tonkin Springs LLC and the lien holder
(whether SRK or a Contractor) for the payment of
all or any portion of the lien once all funds in
the Escrow Account have been disbursed, it being
expressly understood and agreed that TSHI's
liability under this Agreement is limited to the
$250,000 previously deposited by it into the Escrow
Account. If the parties do not resolve the issue
of whether TSHI acted unreasonably in instructing
the Escrow Agent not to pay an invoice, the issue
of whether TSHI acted unreasonably shall be
resolved by binding arbitration in Denver, Colorado
pursuant to the commercial arbitration rules of the
American Arbitration Association. No other
disputes under this Agreement shall be required to
be resolved by arbitration, unless the parties to
the dispute so agree in writing.
Contractors.
In accordance with this Section 6.1, SRK will, as
agent on behalf of Tonkin Springs LLC, hire
Contractors to perform earth moving, surveying and
drilling in connection with performance of the Work
Plan. SRK shall supervise, control and direct all
Work performed by Contractors and ensure that such
Work is performed in strict accordance with the
Work Plan, in a good, workmanlike and safe manner,
in as expeditious a manner as reasonably
practicable and in accordance with all requirements
of applicable law and regulations. SRK shall not
hire or enter into any contract with any Contractor
without a written agreement between such Contractor
and SRK (acting as the agent of Tonkin Springs
LLC), and without the prior written approval of
that agreement by both TSHI and Tonkin Springs LLC,
which approval shall not be unreasonably withheld
or delayed. Neither SRK nor any other party to
this Agreement shall terminate any contract with a
Contractor without the prior written consent of
each of TSHI and Tonkin Springs LLC, which consent
shall not be unreasonably withheld or delayed.
Neither TSHI nor Tonkin Springs LLC shall provide
instructions to any of the Contractors with respect
to the Work, it being understood that the provision
of such instructions is the responsibility of SRK
and that any suggestions or requests from TSHI or
Tonkin Springs LLC must instead be provided to
SRK's representative in accordance with Section 1.3
of this Agreement. As between TSHI, SRK and Tonkin
Springs LLC, SRK shall be responsible for the
willful misconduct and negligent acts and omissions
of any of the Contractors. TSHI and Tonkin Springs
LLC may make reasonable requests for information
and data concerning any and all Contractors under
this Agreement, and SRK hereby agrees to submit
such information and data promptly upon request.
Each of TSHI and Tonkin Springs LLC shall pay their
own costs and expenses in connection with their
respective reviews of proposed contracts and
Contractors.
Protection of Persons and Property.
SRK acknowledges and is aware, and hereby
represents that it has made and will make the
Contractors aware, that the Tonkin Springs property
may contain hazardous substances, constituents, or
contaminants, and subject to Section 5, SRK
knowingly and voluntarily assumes all risk of
injury and damages to SRK, SRK's personnel, and
SRK's property and to the Contractors, Contractors'
personnel, and Contractors' property, caused by
exposure to such materials. SRK agrees to advise
fully all of its employees and agents working for
SRK at the property, as well as the Contractors, of
the associated risks and of all necessary
environmental, safety, and health procedures
required by applicable state or federal law,
regulation, or order. SRK covenants and warrants
that all personnel, including SRK's employees, have
been fully trained in accordance with applicable
laws, rules or regulations.
SRK agrees that it will report to TSHI and Tonkin
Springs LLC, in writing, any personal injury of
SRK's or Contractors' employees, within 24 hours of
the injury or as soon as practicable.
SRK shall have the right to use the office
facility of Tonkin Springs LLC at the Tonkin
Springs project, but no other facilities or
equipment of Tonkin Springs LLC. Any long
distance telephone charges, or any other
incremental operating costs associated with
SRK's work at the office facility, shall be
borne solely by SRK. SRK agrees to maintain
that office in a neat and clean manner.
Insurance.
SRK agrees at all times during the term of this
Agreement to maintain in full force and effect:
(a) Worker's Compensation Insurance, including
occupational disease in accordance with applicable
statutory and regulatory requirements; (b)
Employer's Liability Insurance, including coverage
on all of SRK's employees engaged in the
performance of the Work; (c) Commercial General
Liability Insurance, including protective liability
covering death or bodily injury and contractual
liability; and (d) Professional Liability
Insurance. SRK agrees to furnish to TSHI and
Tonkin Springs LLC its certificates of insurance or
other evidence satisfactory to TSHI and Tonkin
Springs LLC to the effect that such commercial
general liability insurance has been procured,
names TSHI, TSVLP and Tonkin Springs LLC as
additional insureds, and is in force except for
primary errors and omissions insurance, the
certificates shall state that the policies of
insurance are in force and cannot be canceled or
otherwise terminated without thirty (30) days
advance written notice.
For the purpose of this Agreement, SRK shall carry
the following types of insurance in the limits
(which may be a combination of primary and excess
coverage) specified below:
Coverages Limits of Liability
Worker's compensation Statutory
Employer's liability $1,000,000
Commercial general liability $1,000,000 per
Occurrence,
$1,000,000 aggregate
Umbrella Liability $4,000,000
Automobile $1,000,000 combined
single limit
Professional liability $2,000,000 per
occurrence and aggregate
TSHI, Tonkin Springs LLC and SRK will require all
Contractors to maintain in full force and effect:
(a) Worker's Compensation Insurance, including
occupational disease in accordance with applicable
statutory and regulatory requirements; (b)
Employer's Liability Insurance, including coverage
on all of SRK's employees engaged in the
performance of the Work; and (c) Commercial General
Liability Insurance, including protective liability
covering death or bodily injury and contractual
liability. Contractors will agree to furnish to
TSHI, Tonkin Springs LLC and SRK its certificates
of insurance or other evidence satisfactory to
TSHI, Tonkin Springs LLC and SRK to the effect that
such commercial general liability insurance (a) has
been procured, (b) names TSHI, TSVLP, Tonkin
Springs LLC and SRK as additional insureds, and (c)
is in force. The certificates shall state that the
policies of insurance are in force and cannot be
canceled or otherwise terminated without thirty
(30) days advance written notice. For the purpose
of this Agreement, Contractors shall carry the
following types of insurance in the limits (which
may be a combination of primary and excess
coverage) specified below:
Coverages Limits of Liability
Worker's compensation Statutory
Employer's liability $1,000,000
Commercial general liability $1,000,000 per
occurrence,
$2,000,000 aggregate
Automobile $1,000,000 combined
single limit
Independent Contractor.
In the performance of the services under this
Agreement, SRK shall be an independent contractor,
maintaining complete control of SRK's personnel and
operations and the implementation of the Work Plan.
As such, SRK shall pay all salaries, wages,
expenses, social security taxes, federal and state
unemployment taxes, and any similar taxes relating
to the performance of this Agreement. SRK and its
employees shall in no way be regarded as or act as
agents or employees of TSHI or Tonkin Springs LLC.
This Agreement does not and shall not be construed
to create any partnership, joint venture or agency
whatsoever.
Notices.
Any notice required or permitted to be given under
this Agreement shall be in writing and shall be
deemed to have been given when hand delivered or
deposited in the United States mail, certified or
registered, return receipt requested, postage
prepaid, addressed to the respective address of
SRK, TSHI or Tonkin Springs LLC, as appropriate,
set forth at the top of this Agreement or such
other address(es) as either party shall designate
by written notice to the other. In addition,
pursuant to this Agreement, any notice, report or
other communication to TSHI shall also be provided
to TSHI by facsimile to Xx. Xxxxx Xxxxxxx at (416)
367-4681 and any notice, report or other
communication to Tonkin Springs LLC shall also be
provided to Tonkin Springs LLC by facsimile to
(000) 000-0000.
Nonassignment.
TSHI and Tonkin Springs LLC have entered into this
Agreement in order to receive the professional
services of SRK. SRK will not make any assignment,
by operation of law or otherwise, of all or any
portion of the Work required under this Agreement
without first obtaining the written consent of TSHI
and Tonkin Springs LLC. However, the respective
rights and obligations of TSHI and Tonkin Springs
LLC hereunder shall inure to the benefit of and
shall be binding upon the successors and assigns of
TSHI and Tonkin Springs LLC, respectively.
Miscellaneous.
The terms and provisions of Section 3, entitled
Confidential Information, Section 5, entitled SRK's
Representations, Warranties, and Responsibilities,
Section 7, entitled Protection of Persons and
Property, and Section 9, entitled Independent
Contractor, shall survive the termination of this
Agreement, howsoever brought about.
SRK shall not be responsible hereunder for any
delay, default or nonperformance of this agreement,
if and to the extent that such delay or
nonperformance is caused by an act of God, weather,
accident, labor strike, fire, explosion, riot,
rebellion, terrorist activity, sabotage, flood,
epidemic, act of government authority or any other
cause beyond the reasonable control of SRK.
TSHI and Tonkin Springs LLC shall have the right to
inspect and audit SRK's books, records and all
associated documents relating to such costs. SRK
agrees to maintain records and associated documents
for a period of two years from the end of the
calendar year in which such costs were incurred and
to make such books and records available to TSHI
and Tonkin Springs LLC at all reasonable times
within the two-year period and for so long
thereafter as any dispute remains unresolved. TSHI
and Tonkin Springs LLC may photocopy any such books
and records at their own expense.
This Agreement shall be subject to and governed by
the laws of the state of Colorado. The Work and
performance of same shall comply with all
applicable city, county, state, and federal codes,
rules, regulations, and orders.
Failure of any party to exercise any option, right,
or privilege under this Agreement or to demand
compliance as to any obligation or covenant of the
other party shall not constitute a waiver of any
such right, privilege, option, or performance,
unless waiver is expressly required by this
Agreement or is evidenced by a properly executed
instrument.
This Agreement may not be modified except by
written amendment executed by the parties hereto.
The invalidity or unenforceability of any provision
hereof shall not affect the validity or
enforceability of any other provision.
This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be
an original, and such counterparts shall together
constitute and be one and the same agreement.
This Agreement, together with the attachment and
all documents, drawings, specifications, and
instruments specifically referred to in the
Agreement shall constitute the entire agreement
between the parties, and no other proposals,
conversations, bids, memoranda, or other matter
shall vary, alter, or interpret its terms. The
captions in this Agreement are for the convenience
of the parties in identification of the several
provisions and shall not constitute a part of this
Agreement or be considered interpretative. In the
event of any conflict or inconsistency between the
terms and conditions of this Agreement and those of
the Work Plan, the terms and conditions of this
Agreement shall in all instances prevail and
govern.
Dated as of the 18th day of December, 2001.
XXXXXXX XXXXXXXXX & XXXXXXX
(U.S.), INC.
By: Xxxxxx X. Xxxxxx
Its: Controller
TONKIN SPRINGS HOLDINGS NC.
By: Ebe Scherkus
Its: Executive Vice
President, Chief Operating
Officer
TONKIN SPRINGS LLC
By: Xxxxxxx X. Pass
Its: Vice President
Exhibit 10.19
Management Agreement dated effective January 1,
2001 between U.S. Gold Corporation and Gold
Resource Corporation.
MANAGEMENT AND ADMINISTRATION AGREEMENT
Between GOLD RESOURCE CORPORATION And
U. S. GOLD CORPORATION
THIS MANAGEMENT AND ADMINISTRATION AGREEMENT (the
Agreement) is made and entered into effective as of
January 1, 2002, between Gold Resource Corporation,
a Colorado corporation (GRC), whose address is 0000
Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxx 00000-0000 and
U.S. Gold Corporation, a Colorado corporation (U.S.
Gold), whose address is 0000 Xxxxxxx Xxxxxx, Xxxxx
000, Xxxxxxxx, Xxxxxxxx 00000-0000.
ARTICLE I.
RECITALS:
1.1 WHEREAS GRC has certain intended business
activities including management and evaluation and
potential development of mineral properties located
in Mexico, related funding activities and general
corporate administration (collectively Business
Activities) and is interested in securing the
management and administration of such Business
Activities; and
1.2 WHEREAS U.S. Gold has the personnel, facilities
and experience to provide GRC certain management
and administrative services related to the Business
Activities;
1.3 NOW THEREFORE, in consideration of the promises
and of the mutual covenants, conditions, and
obligations contained herein, and other valuable
consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree
as follows:
ARTICLE II.
SCOPE OF SERVICES TO BE PROVIDED
2.1 U.S. Gold agrees to provide the following
general Management and Administrative Services to
GRC as provided in this Agreement:
2.2 Executive Management- The time and services of
the following individuals will be provided on an
as-needed basis (anticipated to require, on
average, no more than approximately 50% of the
normal available work period): a) Xxxxxxx X. Xxxx;
b) Xxxxxxx X. Pass, and c) Xxxxx X. Xxxx, each whom
are full-time executive employees of U.S. Gold.
2.3 Office Services- The office and infrastructure
of U.S. Gold's Lakewood, Colorado offices will be
made available to support the Business Activities
of GRC including, but not limited to, non-exclusive
use of computers, printers, telephones, facsimile,
files storage, mail service. Any third party
expenses for the direct benefit of GRC shall be
paid directly by GRC.
2.4 Preparation of Agreements- U.S. Gold, on behalf
of GRC, will prepare such drafts and negotiate with
third parties any agreements related to Business
Activities, for final review, approval and
execution, as directed by the Board of Directors of
GRC. Any out of pocket costs related to such
activities, including but not limited to travel
costs, fees of attorneys, accountants and tax
experts, shall be paid directly by GRC.
2.5 Financing Activity- U.S. Gold, on behalf of
GRC, shall prepare such documents and make such
presentations as necessary or appropriate towards
the objective of raising funding for Gold Resource,
including but not limited to equity, debt, and
lease financings, except that under no
circumstances shall U.S. Gold act as, or be
construed as acting as financial advisor to, or
underwriter or placement agent of any securities of
GRC. All arrangements shall be reviewed, approved
and executed as directed by the Board of Directors
of GRC. Any out of pocket expenses related to such
activities shall be paid directly by GRC.
2.6 Management of Consultants- U.S. Gold, on behalf
of GRC, may and shall enter into consulting
agreements with third parties for the furtherance
of Business Activities, and shall work with and
manage such consultants in such activities, as
directed by the Board of Directors of GRC. All
direct and indirect costs and expenses related to
such consultants, consulting agreements and related
activities shall be paid directly by GRC. Examples
include lawyers, accountants, engineers,
engineering firms, field personnel, etc.
2.7 Management of Contracts- U.S. Gold, on behalf
of GRC, shall enter into such contracts with third
parties as required for the furtherance of Business
Activities, and shall manage such contracts. All
direct and indirect costs and expenses related to
such contracts shall be paid directly by GRC.
Examples include but are not limited to engineering
design, facilities fabrication and construction,
permitting, etc.
2.8 Establishment of Subsidiaries and Qualification
to Conduct Business- U.S. Gold, on behalf of GRC
and upon advice of consultants, shall create such
business entities as necessary and appropriate
including subsidiaries of GRC, to hold assets and
conduct operations related to or in furtherance of
Business Activities.
2.9 Opening of Bank Checking and Savings Accounts-
U.S. Gold, on behalf and in the name of GRC, shall
from time to time open checking and savings
accounts at banks and other financial institutions
to hold assets and conduct operations related to or
in furtherance of Business Activities.
2.10 Maintenance of Books and Records- U.S. Gold
will maintain checking and savings account records
for and on behalf of GRC and shall prepare monthly
budgets and monthly accounting for all activities.
An annual independent audit, at the expense of GRC,
shall be performed on the financial accounts of
GRC. U.S. Gold will provide such independent
auditors full access to all records and full
cooperation in the conduct of such annual audit.
ARTICLE III.
CONSIDERATION TO U. S. GOLD
3.1 As consideration for the services provided by
U.S. Gold under this Agreement, unless terminated
early as provided herein, GRC shall pay to U.S.
Gold $30,000.00 per month payable no later than the
first business day of each month thereunder.
ARTICLE IV.
TERM OF AGREEMENT
4.1 The term of this Agreement, unless terminated
earlier as provided in Section V below, shall be
twelve (12) months commencing January 1, 2002 and
terminating December 31, 2002.
ARTICLE V.
EARLY TERMINATION
5.1 This Agreement may not be terminated by either
party other than for cause with 30-day prior
written notice.
5.2 In the event that either party terminates this
Agreement for cause, there shall be a prorate
of the monthly payment to U.S. Gold as per
Article 3.1 through the effective date of such
termination.
ARTICLE VI.
REPRESENTATIONS, WARRANTIES AND COVENANTS
6.1 GRC hereby represents and warrants to U.S. Gold
as of the date of this Agreement, and this
Agreement is made in reliance on the following
representations and warranties:
a) GRC is a corporation duly organized, validly
existing and in good standing under the laws of
Colorado. GRC has full corporate power and
authority, and all franchises, licenses and permits
as are necessary to own its assets and to carry on
its business as presently conducted and to
consummate the transactions contemplated by this
Agreement.
6.2 U.S. Gold hereby represents and warrants to GRC
as of the date of this Agreement, and this
Agreement is made in reliance on the following
representations and warranties:
a) U.S. Gold is a corporation duly organized,
validly existing and in good standing under the
laws of Colorado. U.S. Gold has full corporate
power and authority, and all franchises, licenses
and permits as are necessary to carry on its
business as presently conducted and to consummate
the transactions and performance contemplated by
this Agreement.
b) Xxxxxxx X. Xxxx, Xxxxx X. Xxxx and Xxxxxxx X.
Pass are executive employees of U.S. Gold.
ARTICLE VII.
GOVERNING LAW
7.1 This Agreement shall in all respects be
governed by, and construed in accordance with, the
laws of the State of Colorado, including all
matters of construction, validity and performance.
In WITNESS WHEREOF, the parties have executed this
Agreement effective the first date set forth above.
GOLD RESOURCE CORPORAITON
By: Xxxxxxx X. Xxxx, President
November 29, 2001
U. S. GOLD CORPORATION
By: Xxxx X. Goth, Independent Director
November 29, 2001
Exhibit 10.20
Technology Option Agreement dated
December 18, 2001 between Newmont Technologies
Limited and U.S. Gold Corporation.
TECHNOLOGY OPTION AGREEMENT
Preamble
This is an agreement (the Agreement) between U.S.
Gold Corporation, a Colorado corporation having a
business address at 0000 Xxxxxxx Xx., Xxxxx 000,
Xxxxxxxx, Xxxxxxxx 00000-0000 (USGC) and Newmont
Technologies Limited, a Nevada Corporation having a
business address at 00000 X. Xxx Xxxxx Xxxx,
Xxxxxxxxx, Xxxxxxxx 0000000 (NTL). This Agreement
is to be effective as of December 18, 2001
(Effective Date).
Recitals
A. NTL and/or its parent Newmont Mining Corporation
(NMC) has patents and know-how concerning certain
inert gas flotation technology (the N2TEC
Flotation Technology) that has application to
flotation of certain refractory sulfide gold ores,
and NTL is interested in licensing others to
operate within the scope of these patent rights
and/or to use the know-how.
B. USGC has at its Tonkin Springs Mine in Eureka
County, Nevada refractory sulfide gold ores that
appear to be amenable to processing with the N2TEC
Flotation Technology and USGC is interested in
possible implementation and use of the N2TEC
Flotation Technology at an appropriate time during
development at the Tonkin Springs Mine, but is not
interested in entering into a license agreement
with NTL at this time.
C. NTL is willing to provide to USGC and USGC is
willing to accept certain option rights according
to the terms and conditions set forth below
concerning possible future licensing and use of the
N2TEC Flotation Technology for processing
refractory sulfide gold ore at the Tonkin Springs
Mine.
Agreement
1. DEFINITIONS. For purposes of this Agreement, the
following terms shall have the meanings set forth
below:
Option Period means a period of time beginning with
the Effective Date and expiring May 31, 2002.
Negotiation Period means a period of time beginning
with Exercise Of Option and expiring June 30, 2002.
Exercise Of Option has the meaning as provided in
section 2.2.
Option Fee means the sum of $US10,000 (ten thousand
United States dollars).
2. OPTION/EXERCISE OF OPTION/OPTION FEE.
2.1 NTL hereby grants to USGC an option to have NTL
enter into good faith negotiations between NTL and
USGC during the Negotiation Period to pursue
agreement concerning definitive terms of a license
agreement (the License Agreement) by which NTL
would nonexclusively license NTL's and NMC's U.S.
patents and know-how concerning the N2TEC
Flotation Technology to USGC for use to process
refractory sulfide gold ore at the Tonkin Springs
Mine (NTL's and NMC's existing U.S. patents
concerning the N2TEC Flotation Technology are
listed in Exhibit A attached hereto). The License
Agreement would include provisions to effect at
least the following key concepts:
(a) NTL would grant to USGC a nonexclusive license
to NTL's and NMC's U.S. patents and know-how
concerning the N2TEC Flotation Technology for use
in flotation processing of refractory sulfide gold
ore from the Tonkin Springs Mine.
(b) USCG would pay to NTL license fees including
(i) an initial license fee of $US50,000 (fifty
thousand United States dollars), with USCG
receiving a credit against such initial license fee
for payment of the Option Fee and (ii) ongoing
production royalties, to be reported and paid
quarterly, based on two percent (2%) of precious
metals paid from concentrates prepared using the
N2TEC technology, to be paid at NTL's option in-
kind in concentrate containing xxxxx xxxxxxxx
metals that are calculated to net to the paid
quantity or in money based on net smelter returns
or an equivalent net return if subsequently
processed by other than smelting, with the ongoing
production royalties being subject to an annual
minimum of $10,000 per year starting with the
second year of the License Agreement. Upon
expiration of the last-to-expire of NTL's and NMC's
patents concerning the N2TEC(r) Flotation Technology,
ongoing production royalties would thereafter be
reduced by one-half. NTL would have a right to
audit at least annually pertinent records
concerning the Tonkin Springs Mine to verify the
accuracy of ongoing production payments. USCG
would be permitted to pay the initial license fee
in installments due as follows: (i) $US30,000
(thirty thousand United States dollars) to be paid
upon execution by USGC of the License Agreement
(with the credit for payment of the Option Fee
being applied against this installment), (ii)
$US10,000 (ten thousand United States dollars) to
be paid no later than three months following
execution by USGC of the License Agreement and
(iii) $US10,000 (ten thousand United States
dollars) to be paid no later than six months
following execution by USGC of the License
Agreement.
(c) Within the first two (2) years of the License
Agreement, USGC would have an option to buy-out
one-half or all of any further production royalties
(including further annual minimums) at a rate of
$US500,000 (five hundred thousand United States
dollars) for buy-out of one-half (1% of precious
metals paid from concentrates) or $1,000,000 (one
million United States dollars) for buy-out of all
(2% of precious metals paid from concentrates) of
any further production royalties.
(d) All improvements, enhancements, modifications
and adaptations of any portion of the N2TEC
Flotation Technology discovered or developed during
the term of the License Agreement would be reported
to and owned by NTL.
(e) USGC would maintain in confidence and not use
for any purpose other than exercise of its license
rights all information and know-how concerning the
N2TEC Flotation Technology, including all
improvements, enhancements, modifications and
adaptations.
(f) NTL would commit to provide a reasonable amount
of technical consultation during design, start-up
and operation of a flotation operation implementing
the N2TEC Flotation Technology at the Tonkin
Springs Mine for at least the first two (2) years
of the License Agreement. USGC would pay for all
technical consultation provided by NTL, except that
during the first two (2) years of the License
Agreement, NTL would provide free of charge up to
five (5) man days per year of technical
consultation.
(g) To the extent that NTL or NMC agrees to perform
any additional test work for USGC related to
amenability of the N2TEC Flotation Technology for
processing refractory sulfide gold ore from the
Tonkin Springs Mine, NTL or NMC would be paid for
performing the test work.
(h) NTL would make no representations or warranties
(including any representations or warranties with
respect to the validity of any patents, freedom to
practice any technology or the quality or extent of
any know-how or technical consultation services),
except for a representation that NTL has the right
to enter into the License Agreement. NTL would
have no obligation to enforce any patents. USGC
would have no right to enforce any of NTL's or
NMC's patents.
(i) The License Agreement would have a term that
lasts until the last-to-expire of NTL's and NMC's
U.S. patents concerning the N2TEC Flotation
Technology and so long thereafter as the N2TEC
Flotation Technology is used to process refractory
sulfide gold ore from the Tonkin Springs Mine,
provided that USGC would be permitted to
prematurely terminate the License Agreement with at
least three (3) months prior written notice to NTL,
in which case USGC would immediately cease all use
of N2TEC Flotation Technology.
(j) The License Agreement would be interpreted
construed and governed in accordance with the laws
of the State of Colorado, without reference to
conflict of laws principles, and all disputes
arising from or relating to the License Agreement
would be within the exclusive jurisdiction of the
state and/or federal courts located within the
State of Colorado.
2.2 Exercise Of Option requires that USGC provide
to NTL during the Option Period effective written
notice that USGC desires to commence good faith
negotiations with NTL to pursue agreement between
NTL and USGC concerning definitive terms for the
License Agreement. Such written notice shall be
effective only upon actual receipt by NTL.
2.3 Upon execution of this Agreement, USGC shall
pay to NTL the Option Fee.
2.4 NTL represents that it has a good faith
interest in nonexclusively licensing USGC to use
the N2TEC Flotation Technology to process
refractory sulfide gold ore from USGC's Tonkin
Springs Mine and believes that good faith
negotiations between NTL and USGC will lead to a
definitive agreement for such a license. NTL's
only obligation under this Agreement, however,
shall be to in good faith enter into and in good
faith participate in and pursue the negotiations
with USGC during the Negotiation Period as provided
in this Agreement. This Agreement grants no rights
to USGC to any patents, know-how or other rights of
NTL or NMC concerning the N2TEC Flotation
Technology. USGC understands and acknowledges that
there is no assurance that final agreement will
actually be reached on definitive terms for the
License Agreement and that USGC shall have no right
to use the N2TEC Flotation Technology unless
definitive terms for the License Agreement are
finally agreed upon and the License Agreement
containing such definitive terms is finalized and
duly executed on behalf of both NTL and USGC prior
to expiration of the Negotiation Period. Upon
expiration of the Negotiation Period, NTL shall
have no further obligations under this Agreement.
3. MISCELLANEOUS.
3.1 USGC shall not assign or otherwise transfer
this Agreement, or any portion of this Agreement,
without the prior written consent of NTL. NTL
shall not assign or otherwise transfer this
Agreement, or any portion of this Agreement,
without the prior written consent of USGC; provided
that NTL can without prior consent of USGC to
transfer this Agreement, or any rights or
obligations of NTL under this Agreement, to any
affiliate(s) of NTL, including without limitation a
right by NTL to delegate to any affiliate(s) of NTL
any obligation under this Agreement or the License
Agreement.
3.2 Time is of the essence of this Agreement. In
particular, USGC understands and acknowledges that
NMC is currently in negotiations with another
company concerning a possible arrangement whereby
NMC and/or NTL would license rights in the N2TEC
Flotation Technology to the other company and the
other company would then be the exclusive source
for sublicensing the N2TEC Flotation Technology
for use in non-Newmont operations, and in the event
that NTL and USGC do not agree to definitive terms
for the License Agreement and duly execute the
License Agreement during the Negotiation Period, it
is possible that NTL would not thereafter have an
ability to license the N2TEC Flotation Technology
to USGC for use at the Tonkin Springs mine and NTL
can provide no assurances to USGC concerning the
terms under which a sublicense to the N2TEC
Flotation Technology might then be available from
the other company.
3.3 All notices and payments made pursuant to this
Agreement shall be delivered to the person/address
as provided below, or to such other person/address
as a party may hereafter designate in writing to
the other party:
If to NTL: K. Xxxx XxXxxx
Newmont Technical Facility
00000 X. Xxx Xxxxx Xxxx
Xxxxxxxxx, XX 00000
If to USGC: Xxxxxxx Xxxx
U.S. Gold Corporation
0000 Xxxxxxx Xx., Xxxxx 000
Xxxxxxxx, XX 00000-0000
3.4 This Agreement constitutes the entire agreement
and understanding of the parties relating to
licensing of rights to N2TEC Flotation Technology
and this Agreement supercedes all previous
communications, proposals, representations and
agreements, whether oral or written, relating
thereto, provided that a prior Nondisclosure
Agreement between Newmont Gold Company (now NMC)
and Tonkin Springs LLC (the Nondisclosure Agreement
having been signed on behalf of Tonkin Springs LLC
on January 25, 2000 and on behalf of Newmont Gold
Company on February 1, 2000) shall be unaffected by
this Agreement, and further provided that USGC, as
the sole owner of Tonkin Springs LLC, shall be
bound by the terms of that Nondisclosure
Agreement, which Nondisclosure Agreement shall
apply to any information disclosed to or otherwise
made available to USGC in furtherance of this
Agreement, and further provided that NTL shall be
an intended beneficiary under such Nondisclosure
Agreement and shall have a full right and
authority to enforce any rights of NMC under such
Nondisclosure Agreement.
3.5 This Agreement shall be interpreted construed
and governed in accordance with the laws of the
State of Colorado, without reference to conflict of
laws principles. All disputes arising from or
relating to this Agreement shall be within the
exclusive jurisdiction of the state and/or federal
courts located within the State of Colorado, and
the parties hereby consent to such exclusive
jurisdiction and waive objections to venue therein.
3.6 This Agreement shall be modified only by a
writing signed by both parties, referring
specifically to this Agreement and setting forth
the specific modifications hereto.
3.7 Any headings of the various paragraphs and
sections of this Agreement have been inserted for
convenience only and shall not be deemed to be made
a part of this Agreement.
IN WITNESS WHEREOF, each party hereto acknowledges
that the representative named below has the
authority to execute this Agreement on behalf of
the respective party to form a legally binding
contract and has caused this Agreement to be duly
executed on its behalf.
Newmont Technologies Limited
Name: Xxxxxxx Xxxxx Xxxx
Title: Vice President
Date: December 18, 2001
U.S. Gold Corporation
By: Xxxxxxx X. Xxxx
Title: President
Date: December 18, 2001
Exhibit 21. Subsidiaries of the Company.
Xxxx Gold Mining Company, a Colorado corporation
Hayden Hills Gold Mining Company, a Colorado
corporation
Tonkin Springs Gold Mining Company, a Colorado
corporation
Tonkin Springs Venture LP, a Nevada limited
partnership
Tonkin Springs LLC, a Delaware limited liability
company
White Pine Gold Mining Company, a Colorado
corporation
U.S. Environmental Corporation, a Colorado
Corporation
Exhibit 23.1 Consent of Xxxxx Winter Xxxxxxxxx & Co.,
LLC, to incorporation of their audit report dated March
19, 2002, in the Company's Form S-8
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We hereby consent to the incorporation by reference in
the Registration Statement of U.S. Gold Corporation on
Form S-8, File No. 33-47460 of our report dated March 19,
2002, on our audits of the consolidated balance sheet,
and related statements of operations, changes in
shareholders equity and cash flows for U.S. Gold
Corporation as of and for the years ended December 31,
2001 and 2000, which report is included in the Annual
Report on Form 10-KSB.
Xxxxx Winter Xxxxxxxxx & Co., LLC
Certified Public accountants
March 19, 0000
Xxxxxx, Xxxxxxxx
