AMENDMENT TO AGREEMENT DATED JUNE 9, 2003 BETWEEN THE COMPANY AND LAS ASUNCION NEGOCIACION MINERA S.A.C. REGARDING THE EL GALENO PROPERTY TRANSLATION
EXHIBIT 23.11B
AMENDMENT TO AGREEMENT DATED JUNE 9, 2003 BETWEEN THE
COMPANY AND LAS XXXXXXXX NEGOCIACION MINERA S.A.C.
REGARDING THE EL XXXXXX PROPERTY
TRANSLATION
Mister Notary:
Kindly enter in your Public Deed Register the Option Amendment Agreement of the Mining Rights Transfer entered into by and between Xx Xxxxxxxx Negociación Minera S.A.C (ASUMIN), with Tax Nº 20338786728, domiciled in Xxxxxxxx Xxxxx Nº 176, Departament 5, of Miraflores District, Province and Department of Lima, duly represented by Xx. Xxxxxxx Xxxxxx Xxxxx Xxxxx, identified with Identity Card N° 07858807 and Xx. Xxxxx Xxxxxx Xxxxx Xxxxx, identified with Identity Card N° 07858843, both empowered as per recorded in the Entry N° 03011466 of the Legal Entities Registry of Lima, hereinafter “THE TITLEHOLDER” of one part; and Lumina Copper SAC, with Tax N° 20506363480, duly represented by Xx. Xxxx Xxxxxxxxx Mariátegui Canny, identified with Voter Card N° Nº08798881, as per Powers of Attorney registered in the Entry N°00011480480 of the Legal Entities Registry of Lima and domiciled in Xxxxxx Aljovín Nº 530 of the District of Xxxxxxxx de Surco, Province and Department of Lima; hereinafter “LUMINA” of the other part; in the following terms and conditions:
FIRST: BACKGROUND
THE TITLEHOLDER and LUMINA have entered into an Option to Transfer Mining Rights Agreement (hereinafter the Option Agreement) upon de following mining concessions (hereinafter the MINING RIGHTS):
| (a) | “El Xxxxxx”, 591.3231 hectares,
Code N° 0300X2984X01, which title was approved by Departmental Resolution
Nº 4701-97-RPM dated June 23rd, 1997, located in the District
of Encañada, Province of Celendín, Department of Cajamarca; |
| (b) | “El Xxxxxx I”, 274.5658 hectares,
Code N° 0300X3250X01, which title was approved by Departmental Resolution
Nº 4669-97-RPM dated June 23rd, 1997, located in the District
of Sorochuco, Province of Celendín, Department of Cajamarca; |
| (c) | “El Galeno II”, 349.9138 hectares,
Code N° 0300X3255X01, which title was approved by Departmental Resolution
Nº 03329-2000-RPM dated August 25th, s000, located in
the District of Sorochuco, Province of Celendín, Department of
Cajamarca; |
| (d) | “Xxxxxx 10”, 22.02 hectares,
Code N° 00-00000-00, which title was approved by Departmental Resolution
Nº 7536-96-RPM dated November 19th, 1996, located in the
district of Encañada, Province of Celendín, Department of
Cajamarca; |
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| (e) | “Xxxxxx 11”, 326.63 hectares, Code N°
00-00000-00, which title was approved by Departmental Resolution Nº
5308-97-RPM, dated June 30th, 1997, located in the District
of Encañada, Province of Celendín, Department of Cajamarca. |
SECOND. - REPRESENTATIONS AND WARRANTIES:
| 2.1 | THE TITLEHOLDER hereby represents and warrants that at the date of execution of this agreement: | |
| (a) | ASUMIN has all the corporate
powers and the authority to enter into the Amendment Agreement to the
Option to Transfer Mining Rights as well as to grant the Option to LUMINA,
being empowered to enter into and to perform all acts undertaken by ASUMIN
by means of this document, and no prior approval is required from
any entity whatsoever. |
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| (b) | Except for those provisions mentioned
in sub-section 1.2 of the Option Agreement referred to the status
of the Mining Concession Galeno II, the MINING RIGHTS are in good
standing, free and clear of any contingencies, liens or encumbrances,
and there are no oppositions by any priority rights of third parties,
as well as no judicial or extra judicial actions nor agreement that may
affect or limit: (i) their free transfer, (ii) the unlimited access of
LUMINA to the areas comprised within the MINING RIGHTS (iii)
or the entering into of this Agreement. Likewise, they are not subject
to any assignment, mining option, joint venture or the like and they are
not challenged for any reason whatsoever. |
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| (c) | The MINING RIGHTS are totally
up to date with the payment of the Concession Fees corresponding to each
one of them for all the fiscal years from the date of their petition up
to the concession fees for year 2002, which payment due on June 2002.
With respect to the penalty for not meeting the annual minimum production
or investment established in article 40 of the Single Text of the Mining
Law approved by Supreme Decree N° 014-92-EM and its amendments, extensions,
regulations and other connected thereto (Mining Law) the MINING RIGHTS
have not been subject to such payment until year 2002. |
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| (d) | The MINING RIGHTS are incorporated
in the Official Mining Map with definitive UTM co-ordinates and has no
knowledge of any priority right within their areas; likewise, has no knowledge
of neighbour or bordering mining rights pending of definitive incorporation
to the Official Mining Map. |
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| (e) | The MINING RIGHTS are not comprised
within any Protected Natural Area, their Cushion Area and/or any Reserved
Area, and have not been declared as Urban Area or Urban Development Area. |
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| (f) | The administrative and registration
steps corresponding to the MINING RIGHTS have been accomplished
with all the formalities for granting the concession title, as provided
by law. |
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| (g) | THE TITLEHOLDER has not failed
to comply whether directly or through authorised third parties prior to
entering into this agreement, with any law, |
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regulation or permit related to the exercise of the
mining activities corresponding to them as TITLEHOLDER of the MINING
RIGHTS, neither violated any provision related to the environmental
protection, there being no environmental conditions that may affect the
MINING RIGHTS. |
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| (h) | THE TITLEHOLDER has complied
with all the formal obligations applicable to the MINING RIGHTS in
accordance with the Mining Law, being up to date with all the declarations,
assessments, studies, payments and all other requirement of law. |
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| 2.2 | If LUMINA verifies
that THE TITLEHOLDER’s title to the MINING RIGHTS is:
(i) defective, (ii) deficient, (iii) corrupted, (iv) limited to its free
assignment contemplated in sub-section 8.4 of the Option Agreement
and its transfer, (v) challenged; LUMINA may file all legal
actions deemed necessary which shall be borne by THE TITLEHOLDER
to remedy such defects, limitations or corruption without any responsibility
for LUMINA, who shall be entitled to deduct from the disbursements
provided in sub-section 3.4 of the Option Agreement all the expenses
actually incurred in the defence of the title without prejudice to THE
TITLEHOLDER ‘s obligation to co-operate with LUMINA in
all those acts deemed necessary to that end and committing itself to obtain
the widest righting of law. This deduction shall not proceed in case the
title and the exercising of the mining activity on the mining rights were
affected as a consequence of the obligations undertaken by LUMINA under
the Option Agreement. |
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| 2.3 | LUMINA hereby represents
and warrants that it has the corporate power and enough authority as to
enter into this Option Amendment Agreement and that not other consent
or approval in connection with this Agreement is required. |
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| 2.4 | THE TITLEHOLDER and
LUMINA hereby represent that this Option Amendment Agreement
is not subject to any regulatory approval nor consent of any nature
whatsoever, although subsequent actions of LUMINA or any of its
affiliates may require approval related to the stock exchange or of any
other kind. In any case any commitment in this extreme shall not affect
the title of THE TITLEHOLDER on the MINING RIGHTS. |
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THIRD.- AMENDMENT OF THE OPTION AGREEMENT
THE TITLEHOLDER and LUMINA hereby agree to modify sub-sections 3.2, 3.3 and 3.4.2 of sub-section 3.4 of Section Third of the Option Agreement, which shall be worded as follows:
| “3.2 | Transfer Price The Transfer Price for 100% of the MINING RIGHTS, including their constituents, accessories and other parts that are part of the Option, is US$2,000,000 (Two million and 00/100 Dollars of the United States of America). This amount could be eventually increased proportionally to the increase of the Retraction Token as agreed in sub-section 3.4.2 of the Option Agreement or sub-section 3.4.1 modified in accordance with this Amendment Agreement; or it could be reduced as provided in sub-section 3.4.3 of the |
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| Option Agreement. Finally, the Transfer Price shall be equal to the corresponding amount to be paid as Retraction Token as agreed in sub-section 3.4 of the Option Agreement. In addition to the Transfer Price and also as consideration for the transfer of the MINING RIGHTS, including their constituents and accessories parts, upon exercising the Option, LUMINA shall pay to THE TITLEHOLDER the amounts provided in sub-section 3.7 of the Option Agreement in the opportunities stipulated therein. The Retraction Token shall not be imputed to the Deferred Price which shall not be subject to any adjustment whatsoever.” |
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| “3.3 | Term of the Option | ||
| (a) | The term of the Option is forty eight (48) days as of the date of execution of the Option Agreement. | ||
| (b) | Prior to the expiration of the forty-eight month
of the Option, LUMINA may extend, at its own decision, the
term of the Option up to thirty six (36) additional months to the forty
eight months agreed in the foregoing paragraph (a). The extension could
be made (i) in three periods of twelve (12) months each one provided that
the intention is notified prior to the expirations of the Option term;
or (ii) alternatively at LUMINA’s decision the Option may
be extended to only one period of thirty six (36) months. The new terms
shall be counted from the day following the expiration of the forty eight
(48) months agreed in the foregoing paragraph (a) of this sub-section
3.3, or the expiration of the extended term, as the case may be. The extension
or extensions as the case may be, shall be made by means of letter through
a notary. |
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| (c) | The Option term is compulsory for THE TITLEHOLDER
and voluntary for LUMINA. Accordingly, LUMINA may terminate
the Option at any time by giving notice to THE TITLEHOLDER through
a notary. The termination shall be effective upon the 30 calendar day
following the date of receipt of the notice. If the Option termination
takes place, both parties shall be stating their conformity in doing so
as signal of not having anything to claim from each other for such termination,
and LUMINA must comply within the terms stipulated in the Option
Agreement with all its obligations due before or at the date of the
Option termination.” |
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“3.4. (...) |
Retractaction Token .- | ||
| 3.4.2 | If LUMINA decides to extend the
Option term as mentioned in paragraph (b) of sub-section 3.3 of Third
Clause, as modified in this Option Amendment Agreement, the payment
of US$1,120,000.00 (One Million One Hundred and Twenty Thousand Dollars
of the United States of America) provided in paragraph (g) of sub-section
3.4.1 of the Option Agreement, shall be postponed until expiration
of the extended term Option. Additionally to the payments established
in subsection 3.4.1 of the Option Agreement, LUMINA shall pay to
THE |
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TITLEHOLDER as Retraction Token the amount of US$100,000.00 (One Hundred Thousand and 00/100 Dollars of United States of America) for each twelve months extended period, which shall be fully paid upon starting each extended period. The 50% of these payments for the extended period or periods shall be imputed to the final payment provided in paragraph (g) of sub-section 3.4.1 which is postponed until the Option exercise. Thus, as an example, of the US$100,000.00 (One hundred thousand dollars of United States of America) that are to be paid at the forty eight (48) months, sixty (60) months and seventy two (72) months, if LUMINA has extended the Option up to such periods, 50% per cent of said amounts, that is, US$ 50,000 (Fifty Hundred Thousand dollar of United States of America) shall be discounted from the US$1,120,000.00 (One Million One Hundred and Twenty Thousand Dollars of the United States of America) which payment remained postponed, so if the option is extended only for twelve months the amount to be paid to exercise the Option shall be US$ 1’070,000; if the Option is extended for two periods of twelve months each the amount to be paid to exercise the Option shall be US$ 1’020,000; and if the Option is extended for three periods of twelve months the amount to be paid to exercise the Option shall be US$ 970,000.00. If LUMINA decides to extend the Option for only one period of 36 months, as provided in (ii) of paragraph (b) of the amended subsection 3.3., it shall pay the amount of US$ 100,000 upon expiration of the 48, 60 and 72 months, provided that the Option is in full force and effect in each one of said opportunities and upon expiration of the 84 month shall pay US$ 970,000 to exercise the Option. The above mentioned shall be understood only as an example, since as already agreed in sub-section 3.4.3 of the Option Agreement, the Retraction Token payments agreed in this sub-section 3.4.3 are subject to adjustments. For purposes of the adjustments, the date of calculation shall be the date in which the payment is made. |
FORTH.- SECTIONS REMAINING IN FULL FORCE AND EFFECT AND DEFINITIONS
| 4.1 | All covenants contained in the Option Agreement that
have not been expressly modified by this Option Amendment Agreement,
including the rules referred to arbitration, remain in full force and
effect.. |
| 4.2 | All definitions contained in the Option Agreement apply to this Option Amendment Agreement. |
FIFTH.- TERM OF THE AGREEMENT
If any of the covenants contained in this Option Amendment Agreement become null or voidable the remaining provisions contained in the Option Agreement or in this Option
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Amendment Agreement shall remain in full force and effect to the extent they may be separated.
The provision contained in Article 225 of the Peruvian Civil Code shall apply to this Agreement in the sense that any eventual nullity for violation of an imperative rule shall not imply the nullity of the act of law but its substitution by the imperative rule. Without prejudice to the foregoing, THE TITLEHODLER and LUMINA undertake to reflect the covenants that might be declared null or voidable in a way that such covenants shall not be challenged.
SIXTH.- EXPENSES
All the notary and registration expenses arising in connection with this Option Amendment Agreement shall be borne by LUMINA.
Mr. Notary, kindly add the clauses required by law as well as the necessary inserts, sending the corresponding copies to the Public Register for its registration in the MINING RIGHTS entries.
Executed in Lima, in signal of conformity, this 30th day of May of 2003.
| Xxxx Xxxxxxxxx-Mariategui Xxxxx | Xxxxxxx Xxxxxx Xxxxx Xxxxx |
| Voter Card N° 08798881 | Identity Card N°07858807 |
| LUMINA | THE TITLEHOLDER |
Xxxxx Xxxxxx Xxxxx Xxxxx
Identity Card N° 078558843
THE TITLEHOLDER
Xxxxxxx Xxxxxx Xxxxx Xxxxx
Identity Card N° 07858807
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