Contract
Exhibit 10.5
[***] CERTAIN INFORMATION IN THIS DOCUMENT HAS BEEN EXCLUDED PURSUANT TO REGULATION S-K, ITEM 601(B)(10). SUCH EXCLUDED INFORMATION IS BOTH NOT MATERIAL AND IS THE TYPE THAT THE REGISTRANT TREATS AS PRIVATE OR CONFIDENTIAL.
PURCHASE AND SALE CONTRACT WITH RESERVATION OF OWNERSHIP OF ASSETS ENTERED INTO BY THE COMPANY CALLED [***] REPRESENTED IN THIS ACT BY MR. [***], XXXXXXXXXXX REFERRED TO AS THE "SELLER"; AND ON THE OTHER HAND, THE COMPANY CALLED [***] REPRESENTED IN THIS ACT BY MISS [***], HEREINAFTER REFERRED TO AS THE "BUYER"; TOGETHER, THE "SELLER" AND THE "BUYER" SHALL BE REFERRED TO AS THE "PARTIES", WHO AGREE TO BE SUBJECT TO THE FOLLOWING BACKGROUND, DECLARATIONS AND CLAUSES.
D E C L A R A C I O N E S
I. | The "SELLER" declares in its own right and under oath to tell the truth, that: |
| i. | It is a legal entity duly constituted by the laws of the Mexican United States, as evidenced by public instrument number 36,539 (thirty-six thousand five hundred and thirty-nine) dated March 14 (fourteen) of 1996 (nineteen hundred and ninety-six), granted in the presence of Xxxxxx X. Xxxxxxxx Xxxxxxx, Notary Public number 139 of the then Federal District, and whose first original was duly registered under electronic mercantile folio number 75811-1, in the Public Registry of Commerce of Torreón, Coahuila dated December 10 (ten) of 2003 (two thousand and three). |
| ii. | Its legal representative has the sufficient and necessary powers to bind its client under the terms of this "CONTRACT", in accordance with Public Deed 30,789 dated April 25, 2024 granted before Xx. Xxxxxxxxx Xxxxx Xxxxx Xxxxx, holder of Notary Public number 247 of Mexico City, which to date have not been revoked or limited in any way. |
| iii. | For the purposes of this "CONTRACT", it indicates as its domicile to hear and receive notifications the one located at Xxxxx Xxx Xxxxxxx Xx. 0000, Xxx. Xxxxxxxxxx, X.X. 00000, Xxxxxxx, Xxxxxxxx, Xxxxxx. |
| iv. | As the legal representative of [***], you have the necessary and sufficient legal capacity to enter into this "CONTRACT". This "CONTRACT" and the execution of the transactions contemplated in this "CONTRACT" have been authorized by all necessary corporate actions by the "SELLER". |
| v. | It is the owner and therefore the legitimate owner of the assets that are in ANNEX 1 located in "Plant II" and "Mine" in the mining unit called "Mina Velardeña", which include: processing plant (includes all equipment |
annexes to the plant, inventory of inputs, and infrastructure that make up Plant II), real estate, furniture (furniture and equipment found in the facilities and offices of the Mine), permits and environmental procedures which may include, but are not limited to, studies, reports, statements, programs and licenses, as well as the authorizations of the water extraction xxxxx issued by CONAGUA (hereinafter "THE ASSETS").
| vi. | It is his will to transfer to the "BUYER", by means of this instrument, the full ownership of "THE ASSETS", referred to in his declaration of which he is the legitimate owner and owner, which has been mentioned in paragraph v. above, with all that in fact and by law corresponds to him. |
| vii. | It informed and provided in a timely manner, all the information and documentation requested in writing by the "BUYER", regarding the legal and financial situation of the company of the "SELLER". |
| viii. | Under oath to tell the truth, that your goods and/or resources, as well as "THE ASSETS" subject matter of this "CONTRACT", do not come directly or indirectly from illicit activities or from any other activity or act that could favor the actualization of the alleged -crimes- of financing terrorism or resources of illicit origin. As well as those rights or assets that will be used to solve or fulfill the object of this instrument do not originate, update or resemble the illicit contemplated in Article 400-Bis of the Federal Criminal Code. |
II. | The "BUYER" declares in his own right, and under oath to tell the truth, that: |
| i. | It is a legal entity duly constituted by the laws of the Mexican United States, as evidenced by public instrument number 2,239 (two thousand two hundred and thirty-nine) dated September 23 (twenty-three) of September 2021 (two thousand twenty-three), granted before the faith of Xx. Xxxx Xxxxxx Xxxxxxxx Xxxxx, Notary Public number 1 of the City of Victoria, Durango, and that, in accordance with its corporate purpose, it is authorized to enter into contracts with the mining activity and for such reasons, it is authorized to enter into this "CONTRACT" and be bound by the terms and conditions established in this "CONTRACT". |
| x. | For the purposes of this "CONTRACT" it indicates as its domicile to hear and receive notifications the one located at Xxxxx xxx Xxxx Xx. 000 Xxx. Xx Xxxxxxxx Xxxxxxx Xxx Xxxxxxx, Xxxxxxx, Xxxxxxxx, Xxxxxx X.X. 00000 |
| xi. | It is interested in acquiring from the "SELLER", by means of this instrument, the ownership of all "THE ASSETS" referred to in subsection v of the respective declarations of the "SELLER". |
| xii. | It has sufficient resources to acquire "the assets" from the "SELLER". |
| xiii. | Under oath to tell the truth, that its resources and/or assets, to obtain "THE ASSETS" subject matter of this "CONTRACT", do not come directly or indirectly from illicit activities or from any other activity or act that could favor the actualization of the alleged -crimes- of financing terrorism or resources of illicit origin. As well as those rights or assets that will be used to solve or fulfill the object of this instrument do not originate, update or resemble the illicit contemplated in Article 400-Bis of the Federal Criminal Code. |
| xiv. | You enter into this "CONTRACT" and purchase "THE ASSETS" with "ALL RIGHTS AND OBLIGATIONS INCORPORATED INTO "THE ASSETS" on the understanding that the status of "THE ASSETS" is accepted "AS IS, AS IS, WITH ALL ITS FAULTS". Except as provided in Declarations I above and Clause 4 of this Agreement, neither "SELLER" nor any other person is making any express or implied representations or warranties with respect to "THE ASSETS", on behalf of "SELLER", and "SELLER" disclaims any other representations or warranties. To the extent that any other material or information has been provided to "BUYER", "BUYER" expressly disclaims the accuracy or completeness of such material or information. |
| xv. | You understand and accept that the purchase and sale of "THE ASSETS" includes those assets mentioned in statement I subsection v of this "CONTRACT". |
III. The "PARTIES" jointly declare, through their legal representative and in their own right respectively, under oath to tell the truth, that:
| i. | They mutually recognize the personality and character with which they respectively hold each other at the conclusion of this "CONTRACT". |
| ii. | The execution of this "CONTRACT" does not violate or transgress any type of contract and/or agreement previously entered into, and they declare that there is no bad faith, fraud, error, deception or any other vice of consent. |
| iii. | The conclusion of the "CONTRACT" is the desire of the "PARTIES" to suit their interests. |
In addition to all of the above, the "PARTIES" declare that they mutually recognize the capacity and personality under which they appear at the signing of this instrument and
assume the above statements as true, subject to the wording of the following:
C L Á U S U L A S:
1.1.The "SELLER" sells with reservation of title, at "BUYER", "THE ASSETS", Through the figure of sale, free of any charge, encumbrance, by means of a certain and determinable price in money, and therefore subject to the full payment of the price agreed in clause 2, he will transfer the character of owner, use and domain and, with this, he will acquire all the rights and obligations inherent and derived from it.
1.2.The "BUYER" Acquires "THE ASSETS" with reservation of title and agrees to receive them on an "as is" basis, on the understanding that the "SELLER" does not make any declaration or guarantee, except as expressly indicated in numeral I of the chapter on Declarations and Clause 4, with respect to the financial, legal, tax, operational, administrative or any other nature of the "SOCIETY".
0.0.Xx a price for the transmission of "THE ASSETS" the "BUYER" is obliged to pay the "SELLER", the total amount of US $3,000,000.00 (Three million dollars 00/100 legal tender of the United States of America) or its equivalent in national currency, plus the Value Added Tax (VAT), an amount that was set by mutual agreement by both "PARTIES" and that both recognize that it is their just and real value.
2.2.The "BUYER" In this act, you are obliged to pay the total price indicated in the previous paragraph, in accordance with the following payment table, with each payment backed by a respective promissory note:
2.3.The "BUYER" You are obliged to pay on the dates established above or on the following business day by deposit or bank transfer, to the following bank account:
Bank: [***]
Account: [***]
2.4.Manifests the "SELLER" that the agreed price is fair and will constitute the full payment of any rights that you had for the transfer of "THE ASSETS" subject matter of this "CONTRACT".
2.5. In the event that the "BUYER" does not make the first payment established in the payment table mentioned in Clause Two Subsection 2.2 on time, the "BUYER" accepts and acknowledges that it will be subject to an economic penalty of 10% (ten) percent of the total cost of this Contract, equivalent to the amount of US$300,000.00 (Three hundred thousand dollars 00/100 legal tender of the United States of America) or its equivalent in national currency, plus Value Added Tax (VAT) due to non-payment in time and form indicated in the payments section; and empowers and authorizes the "SELLER" to take the necessary legal actions for the recovery of the penalty amount and any assets that are in the possession of the "BUYER".
2.6. In the event that the "BUYER" does not make the second payment established in the payment table mentioned in Clause Two Subsection 2.2 on time, the "PARTIES" agree that the "SELLER" will interpret these actions as a refusal by the "BUYER" to continue with the provisions of this "CONTRACT" and this "CONTRACT", will be terminated and the "BUYER" accepts and acknowledges that the first payment made will be in favor of the "SELLER" as compensation for the termination of the "CONTRACT".
2.7. In terms of the provisions of Article 2312 of the Federal Civil Code, the "SELLER" reserves ownership of "THE ASSETS" until the price has been paid in full by the "BUYER".
0.Xx the transfer of property and its effects.
3.1. The "PARTIES" undertake that, once the full payment is accredited in the terms and terms indicated in Clause 2.2, the "SELLER" will transfer the full ownership and release the reservation of title in favor of the "BUYER" of "THE ASSETS", so that the "SELLER" (i) does not reserve any action or right except as indicated herein
"CONTRACT" and; (ii) guarantees to the "BUYER" that "THE ASSETS" object of the purchase and sale consigned in this instrument, have no limitation, charge or encumbrance whatsoever.
3.2. Therefore, once the total payment of "THE ASSETS" is accredited in the terms and terms indicated in Clause 2.2, the "SELLER" will transfer to the "BUYER" the character of owner and all the rights and obligations inherent and derived from them.
3.3 The "SELLER" is responsible for the care and conservation of the "ASSETS" until the date of the second payment set out in Clause 2.2.
3.3. Likewise, the "BUYER" declares that he accepts the ownership of "THE ASSETS", in whose transfer all his rights and obligations are inherently transferred, acquiring from this moment the total responsibility for it and releasing the "SELLER" from all responsibility in this regard, obliging himself to take it out in peace and safe for any related contingency that may arise.
3.4 Use of Plant Equipment and Facilities 2. During the term of this "CONTRACT" and as long as the "BUYER" has not made all the payments, the "SELLER" has the freedom and right to use all the "ASSETS" for its use and benefit, or to be able to process ore for third parties, without responsibility to give notice to the "BUYER".
4. Warranties of the "SELLER":
4.1. The "SELLER" hereby warrants to the "BUYER", in addition to any representations, representations, warranties, or obligations contained in this "CONTRACT", as of the date of execution of this "CONTRACT" that:
4.1.1. The background of this "CONTRACT" and the statements made by the "SELLER" are true, and they recognize that such statements and background have been the determining reason for the will of the "BUYER" to acquire "THE ASSETS" object of the purchase and sale set forth in this instrument.
4.1.2. The "BUYER" knows and accepts the current state of each of "THE ASSETS". The "SELLER" has provided the "BUYER" with all the current information in a precise and truthful form of "THE ASSETS", without any alterations, inaccuracies, errors or modifications in them, but they physically correspond to their content, so there are no reports, minutes or entries additional or different from the information provided previously.
4.2. The "SELLER" will deliver the available information related to the assets mentioned in statement I subsection v of this "CONTRACT", which may be: databases, copy of original deeds, location plan, and all the information available.
4.3. The "SELLER" agrees to vacate the property within a period of no more than 30 days after the total payment of this "CONTRACT", and to remove from the site all
documentation, files and personal data of its collaborators or equipment, which belong to other companies of the "BUYER" and which are located in other facilities of the "Velardeña Mine". All documentation and equipment to be removed will be detailed in Annex 2.
5.1. The "BUYER" assumes all the obligations inherent and derived from "THE ASSETS" representing [***] object of this "CONTRACT", under the character of owner, considering whatever their nature, and regardless of whether in one way or another the acts or facts that originate them have taken their cause before or after the signing of this "CONTRACT", therefore, the "BUYER" undertakes to respond under the terms and conditions that are necessary, and acquiring the right to exercise the rights in the manner that suits its interests.
5.2. To this end, the "SELLER" ceases to be jointly and severally liable under the character of owner, and the "BUYER" assumes such responsibility, regardless of whether in one way or another the acts or facts that give rise to it have taken their cause before or after this "CONTRACT".
5.3 As of the time the "BUYER" makes all the payments established in Clause Two Subsection 2.2, the "PARTIES" agree that the only one responsible for each and every one of the obligations, conditions and responsibilities required by environmental legislation, current permits and environmental procedures included in "THE ASSETS" and past, present and future environmental liabilities and will be solely and exclusively the responsibility of the "BUYER", and will comply with Mexican environmental regulations in relation to environmental compliance in the construction, operation, closure and post-closing of operations.
5.4. The "BUYER" shall be responsible for any notices to third parties or governmental authorities arising from the sale of "THE ASSETS" hereunder after the goods have been paid in full.
The "BUYER" will take all necessary actions to change the name of the Xxxxxxx Mining Company of any and all studies, reports, statements, programs, licenses and water xxxxx as soon as practicable, but in any event within six (6) months following the date of the last payment under this "CONTRACT".
6.1. The taxes, expenses and fees that may be generated by virtue of this "CONTRACT" will be paid by the "BUYER" under the terms of the applicable and current legislation.
In accordance with the terms of the Value Added Tax Law, for the payment received by the "SELLER", it will expressly transfer and itemize the Value Tax
Corresponding addition, in accordance with the applicable articles of the aforementioned Law, as well as applicable articles of the Federal Tax Code.
7.1. All notices and notifications between the "PARTIES" must be made in writing and delivered either personally or by certified mail with acknowledgement of receipt, to the addresses indicated by each of the "PARTIES" in their respective declarations, unless the "PARTIES" notify their change of address at least 15 fifteen calendar days prior to its becoming effective.
8.1. The "PARTIES" agree that the headings that appear at the beginning of each of the clauses of this "CONTRACT" have only been inserted for reference purposes, and therefore should not be considered at any time as a means of interpretation of this "CONTRACT".
9.1. This "CONTRACT" may not be modified, except by agreement of the "PARTIES" granted in writing with the same formalities of this document.
9.2. This "CONTRACT" represents the entire agreement between the "PARTIES" and therefore renders null and void any other verbal or written agreement that may have existed between the "PARTIES" prior to this instrument.
10.1. The "PARTIES" agree that the interpretation, compliance and execution of this "CONTRACT" will be in accordance with the federal legislation in force and applicable in Mexico, and expressly submit to the competence and jurisdiction of the competent courts in the city of the City of Torreón, Coahuila, expressly waiving any other jurisdiction that for domicile issues, place of execution of the commission object of this "CONTRACT", nationality of the "PARTIES", or any other, may correspond to them.
10.2. The "PARTIES" agree that the "CONTRACT" and any other document contemplated in this "CONTRACT" will be drafted only in the Spanish language.
Notwithstanding anything to the contrary in this Agreement, in no event shall any of the parties , or any of their shareholders, affiliates, subsidiaries, directors, officers, employees, or agents be liable for any special, incidental, indirect, exemplary, punitive, consequential, or punitive damages (including loss of profits, lost revenue, or lost sales) in connection with any claim, loss, damage or injury arising out of such party's conduct under this "CONTRACT" or for any tort liability, regardless of whether or not the breaching party was advised of the possibility of such damages.
The "PARTIES" being aware of the content and scope of this "CONTRACT", they declare themselves in agreement with the content of this "CONTRACT", and recognize that in the execution of this there was no fraud, error, bad faith or any other defect of consent, and ratify and sign it in the presence of two witnesses, who also signed, in the city of Torreón, Coahuila, on April 29 (twenty-nine), 2024 (two thousand and twenty-four).
THE "BUYER" | | THE "SELLER" |
| | |
[***] | | [***] |
ANNEX 1
ASSETS – MACHINERY, PLANT EQUIPMENT 2
ASSETS – LAND
ASSETS – PERMITS AND ENVIRONMENTAL PROCEDURES
Floor II | ||
| ||
Jales Dam | ||
Bank of loan materials 2. | ||
ASSETS – TRANSMISSION OF WATER EXTRACTION XXXXX ISSUED BY
CONAGUA
Water extraction xxxxx | ||
ANNEX 2
LIST OF ASSETS, MACHINERY, EQUIPMENT AND INFORMATION
MACHINERY AND EQUIPMENT
OWNED BY SUPPLIERS OF [***] (CHICAGO MINE)
