EXHIBIT 4.7
PURCHASE AGREEMENT,
BY AND BETWEEN
HALO RESOURCES LTD.,
AND
METANOR RESOURCES INC.
EXECUTED
MAY 2, 2006 AS AMENDED AUGUST 28, 2006
PURCHASE AGREEMENT
Made on the 27th day of April, 2006
BETWEEN: METANOR RESOURCES INC. a corporation organized under the
Canada Business Corporations Act, having its head office at
0000 xxxxxx Xxxxxxxx, Xxxxx 0, in the City of Val-d'Or,
Quebec, Canada J0Y 2N0,
(hereinafter called the "PURCHASER")
AND: HALO RESOURCES LTD., a corporation existing under the laws of
the Province of British Columbia having its head office at
1280 -- 000 Xxxx Xxxxxx, in the City of Xxxxxxxxx, X.X.,
Xxxxxx X0X 0X0,
(hereinafter called the "VENDOR" )
WHEREAS the Vendor and the Purchaser each own a 50% undivided ownership interest
in and to (a) the Bachelor Lake Property comprising two mining concessions and
fifty-one (51) mining claims for a surface area of 1,851.54 hectares, (b) the
Hewfran Property comprising thirty-eight (38) mining claims totalling 683
hectares, and (c) the Xxxxxx Property comprising eighty-eight (88) mining claims
totalling 2,286.69 hectares, all as more fully described in Schedule "A"
attached hereto (which schedule forms a part of this Agreement), together with
the buildings, the equipment and the surface and underground infrastructures
thereon erected ( such property and erections collectively the "BACHELOR
PROPERTY");
WHEREAS the Vendor and the Purchaser are parties to a Joint Venture Agreement
dated September 8, 2005 (the "JOINT VENTURE Agreement"), which Joint Venture
Agreement governs the joint ownership and conduct of operations on the Bachelor
Property as a mining property;
WHEREAS the Vendor has agreed to sell to the Purchaser, and the Purchaser has
agreed to purchase from the Vendor, the Vendor's 50% undivided ownership
interest in the Bachelor Property, together with its 50% Participating Interest
(as such term is defined in the Joint Venture Agreement) on and subject to the
terms and conditions of this Agreement (such purchase and sale transaction, the
"PURCHASE TRANSACTION"); and
WHEREAS the Vendor and the Purchaser agree that by purchasing the Participating
Interest of the Vendor, the Joint Venture Agreement shall terminate pursuant to
and in accordance with the terms of Section 13.2(ii) of said Joint Venture
Agreement;
NOW THEREFORE, in consideration of the premises, and other good and valuable
consideration (the receipt and sufficiency of which are acknowledged by each of
the Vendor and the Purchaser), the Vendor and the Purchaser hereby agree as
follows:
ARTICLE 1 -- PURCHASE AND SALE
1.1 Subject to the terms and conditions herein, the Vendor hereby agrees to
sell, assign, convey and transfer to the Purchaser, and the Purchaser
hereby agrees to purchase from the Vendor, the Vendor's 50% undivided
ownership right, title and interest in and to the Bachelor Property,
together with the Vendor's 50% Participating Interest.
ARTICLE 2 -- OWNERSHIP
2.1 Upon the completion of the Purchase Transaction the Purchaser shall
become the owner of the Vendor's 50% undivided ownership interest in
and to the Bachelor Property, in addition to the existing 50% undivided
ownership interest of the Purchaser in and to the Bachelor Property,
subject to the Existing Royalties (as such term is defined in the Joint
Venture Agreement), the Wolfden Royalty (as such term is defined in
section 3.2(b) below) and the Halo Royalty (as such term is defined in
section 3.1(c) below).
2.2 For greater certainty, notwithstanding the terms of section 2.1, the
Vendor makes no representation, warranty or covenant in respect of the
Purchaser's existing 50% undivided ownership interest in and to the
Bachelor Property.
ARTICLE 3 -- CONSIDERATION
3.1 PURCHASE PRICE. The purchase price payable by the Purchaser to the
Vendor for the Vendor's 50% undivided ownership interest in and to the
Bachelor Property and its 50% Participating Interest is:
(a) $3,500,000 payable at Closing (as such term is defined in
section 6.1);
(b) The issuance by the Purchaser to the Vendor at Closing of such
number of common shares of the Purchaser (the "Purchase
Shares") representing an amount equal to $750,000, calculated
at a value per common share equal to the volume weighted
average of the closing price of the common shares of the
Purchaser at the close of trading for the last ten trading
days on the TSX Venture Exchange immediately prior to the date
of this Agreement; and
(c) The grant by the Purchaser to the Vendor at Closing of a 1%
net smelter returns royalty (the "HALO ROYALTY") on all
minerals or mineral products derived from all or any part of
the Bachelor Property or from other ore bodies owned or
controlled by the Purchaser and processed at the Bachelor
Property.
3.2 ASSUMPTION OF LIABILITY. The Purchaser hereby agrees to assume and to
pay for and/or discharge or perform:
(a) all costs, charges, expenses and liabilities of the Vendor
arising under the Joint Venture Agreement or arising or
related to or otherwise incurred in connection with the
Bachelor Property and any activities thereon; and
(b) the Existing Royalties and the 1/2% net smelter return royalty
in favour of Wolfden Resources Inc. on the Vendor's 50%
undivided interest in and to the Bachelor Property (the
"WOLFDEN ROYALTY").
-2-
ARTICLE 4 -- REPRESENTATIONS AND WARRANTIES FROM THE VENDOR
The Vendor hereby represents and warrants to the Purchaser as follows:
4.1 The Vendor is a corporation existing under the laws of the province of
British Columbia, is qualified to do business and is in good standing
under the laws of British Columbia and those jurisdictions where
necessary in order to carry out the purposes of this Agreement.
4.2 All corporate actions required to authorize and to enter into and
perform this Agreement have been properly taken by the Vendor.
4.3 The execution of this Agreement will not result in any material default
under the articles or by-laws of the Vendor or under any legally
binding instrument or applicable law by which the Vendor is bound.
4.4 This Agreement has been duly executed and delivered by the Vendor and
is valid, binding and enforceable upon it in accordance with its terms.
4.5 The mining titles related to the Bachelor Property are registered in
the name of the Vendor for a 50% undivided ownership interest and, as a
result of the completion of the purchase and sale pursuant to article 1
of this Agreement and the due registration of the Purchase Agreement
between the Parties hereto, the Purchaser will acquire the Vendor's 50%
undivided ownership interest in and to the Bachelor Property, free and
clear of all hypothecs, liens and encumbrances of any nature or kind
whatsoever, other than the Existing Royalties (as such term is defined
in the Joint Venture Agreement), the Wolfden Royalty (as defined in
section 3.2(b)) and the Halo Royalty (as such term is defined in
section 3.1).
4.6 No individual, corporation, partnership, trust or any other form of
legal business entity has any agreement, option, right of first refusal
or right, title or interest, or any right capable of becoming any of
the foregoing in, to or in respect of the Vendor's 50% undivided
ownership interest in and to the Bachelor Property.
ARTICLE 5 -- REPRESENTATIONS AND WARRANTIES FROM THE PURCHASER
The Purchaser hereby represents and warrants to the Vendor as follows:
5.1 The Purchaser is a corporation existing under the Canada Business
Corporations Act, is qualified to do business and is in good standing
in the federal jurisdiction of Canada and those jurisdictions where
necessary in order to carry out the purpose of this Agreement.
5.2 All corporate actions and other actions required to authorize the
Purchaser to enter into and perform this Agreement have been properly
taken.
5.3 The execution of this Agreement will not result in any material default
under the articles, by-laws of the Purchaser or under any legally
binding instrument or applicable law by which the Purchaser is bound.
5.4 This Agreement has been duly executed and delivered by the Purchaser
and is valid, binding and enforceable upon it in accordance with its
terms.
-3-
ARTICLE 6 -- COVENANTS
6.1 The completion of the transactions contemplated in this Agreement (the
"CLOSING") will take place at the offices of Gowling Xxxxxxx Xxxxxxxxx
LLP, counsel to Metanor, in Montreal, Quebec at 2:00 p.m. on the
Completion Date (as defined in section 6.2) or at such other time or
place as the parties may agree in writing.
6.2 The Vendor and the Purchaser shall complete the Closing on the date
(the "COMPLETION DATE") that is the earlier of:
(a) the date that is 30 days after the date that the Purchaser has
completed a Cdn. $5,000,000 financing (debt or equity); and
(b) the date that is 4 months from the date of this Agreement (the
"PURCHASE CLOSING DATE").
6.3 The Purchaser shall use its best efforts and take all reasonable
actions as are necessary or prudent in order to complete the financing
referenced in section 6.2(a) on or before the Purchase Closing Date.
6.4 In the event that the Closing does not occur on or before the Purchase
Closing Date as a result of the Purchaser not completing such Closing,
then the Vendor shall have the option, in its sole and absolute
discretion, exercisable by notice in writing from the Vendor to the
Purchaser within ten days of the Purchase Closing Date, to purchase the
Purchaser's 50% undivided ownership interest in and to the Bachelor
Property, together with its 50% Participating Interest, on the same
terms (including representations and warranties) and for the same
consideration as is to be paid by the Purchaser to the Vendor as
provided in section 3.1 of this Agreement, mutatis mutandis. The
completion of any such purchase by the Vendor shall be completed on the
date that is 4 months from the Purchase Closing Date or such earlier
date as the Vendor and Purchaser may agree. In the event that the
Vendor completes such purchase, then the shares of the Vendor to be
issued to the Purchaser pursuant to section 3.1(b) shall be valued on
the same basis as the Purchase Shares but based on the ten trading days
immediately preceding the Purchase Closing Date.
6.5 The Purchaser hereby agrees that it will irrevocably assume and pay all
costs, charges and expenses relating to maintaining the Bachelor
Property in good standing and to maintain all buildings, equipment and
surface and/or underground infrastructures located thereon, and to
maintain all operating permits and other obligations related to the
Bachelor Property in good standing, from the date of this Agreement
until the Completion Date. In the event that the Closing does not occur
on or before the Purchase Closing Date then the Vendor shall re-assume
its obligation to contribute 50% to the costs, charges and expenses
related to the Bachelor Property from and after such date in accordance
with the terms of the Joint Venture Agreement.
6.6 In the event that the Purchase Transaction is not completed and the
Vendor does not exercise and complete its option to purchase as set out
in section 6.4, then neither party shall be liable to the other for
such transactions not being completed and, subject to section 6.5, the
Parties respective interests in and to the Bachelor Property shall
continue to be governed by the Joint Venture Agreement. In the event
that the Vendor exercises its option to purchase as set out in section
6.4 and the sale of the Purchaser's 50% undivided interest in and to
-4-
the Bachelor Property to the Vendor is not completed as a result of the
Purchaser not completing such transaction, then the Purchaser shall be
liable to the Vendor for, and the Purchaser shall and hereby agrees to
indemnify and save harmless the Vendor from, any and all costs,
expenses, losses, damages, liabilities and deficiencies suffered or
incurred by the Vendor and directly or indirectly arising from, related
to or in any way connected with any breach or non-performance of any
representation, warranty, covenant, obligation or agreement made or to
be performed by the Purchaser as a vendor of its 50% undivided interest
in and to the Bachelor Property under this Agreement.
6.7 The Vendor and the Purchaser shall enter into a net smelter returns
royalty agreement (the "NSR AGREEMENT") at Closing in respect of the
Halo Royalty based on the terms set out in this Agreement and in
Schedule "B" (which schedule shall form part of this Agreement) and
such other terms as the Parties shall agree.
6.8 The NSR Agreement shall provide that, subject to the rights of the
Vendor in this section 6.8 below, the Purchaser shall have the right to
buy back the Halo Royalty for $1,000,000 or to buy 1/2 of the Halo
Royalty (i.e. such that the Halo Royalty will become a .05% net smelter
royalty in favour of the Vendor) for $500,000, within 18 months of the
date of commencement of production from the Bachelor Property, by
delivering written notice to such effect to the Vendor within such 18
month period. In the event that the Purchaser gives notice to the
Vendor that it wishes to exercise the buy back for all of the Halo
Royalty at $1,000,000, the Vendor will have the option, in its sole and
absolute discretion, to sell all of the Halo Royalty to the Purchaser
for $1,000,000 or to sell 1/2 of the Halo Royalty to the Purchaser
(i.e. such that the Halo Royalty will become a 0.05% net smelter return
royalty in favour of the Vendor) for $500,000 and the Vendor shall
thereafter be entitled to retain the 0.05% net smelter return royalty
in respect of the entirety of the Bachelor Property.
6.9 The NSR Agreement shall provide that the $1,000,000 or $500,000 payable
by the Purchaser to the Vendor to buy back the Halo Royalty may be
paid, at the option of the Vendor in its sole and absolute discretion,
by immediately available cash or by common shares of the Purchaser.
6.10 Any common shares to be issued by the Purchaser to the Vendor pursuant
to the terms of this Agreement, including the Purchase Shares, shall be
fully paid common shares of the Purchaser listed for trading on the TSX
Venture Exchange and shall be subject to section 6.11 below.
6.11 The Purchaser shall take all necessary corporate action to issue and
deliver any shares to be issued to the Vendor pursuant to this
Agreement, including the Purchase Shares, and to record all such shares
on the books of the Purchaser in the name of the Vendor. The Purchaser
shall comply with applicable securities laws in connection with the
issuance of any shares to be issued to be Vendor pursuant to this
Agreement, including such Purchase Shares.
6.12 Any shares to be issued by the Purchaser to the Vendor pursuant to this
Agreement, including the Purchase Shares, shall be subject to all
applicable hold periods required by applicable securities laws and the
TSX Venture Exchange (but not to exceed four months from the date of
issuance). The issuance of any common shares pursuant to this
Agreement, including the Purchase Shares, shall be conditional upon the
Purchaser obtaining all regulatory consents or approvals, including
those of the TSX Venture Exchange, and the Purchaser will ensure that
-5-
all filings required in order to obtain all regulatory consents and
approvals are made with all applicable securities regulatory
authorities in a prompt and timely manner to allow for the issuance of
such shares on a basis that is exempt from all prospectus and
registration requirements under applicable securities laws and with a
hold period of no greater than four months. In the event that the
Purchaser is unable to issue any shares, including the Purchase Shares,
to be issued to the Vendor pursuant to this Agreement on an exempt
basis on the date which such shares are to be issued, then the
Purchaser shall pay to the Vendor on such date the value of the
Purchase Shares, as set out in section 3.1, in cash by certified cheque
or by wire transfer in immediately available funds.
6.13 Subject to the representations and warranties of the Vendor set out in
Article 4, the Vendor makes no other representation or warranty to the
Purchaser and the Purchaser agrees to purchase the Purchaser's 50%
interest in and to the Bachelor Property on an "as is, where is" basis.
ARTICLE 7 -- CONDITIONS TO CLOSING
7.1 CONDITIONS PRECEDENT IN FAVOUR OF THE PURCHASER. The obligation of the
Purchaser to complete the Purchase Transaction contemplated in this
Agreement shall be subject to the satisfaction of, or compliance with,
at or before the Completion Date, each of the following conditions
precedent (each of which is hereby acknowledged to be inserted for the
exclusive benefit of Purchaser and may be waived by it in writing in
whole or in part):
(a) Each of the representations and warranties of the Vendor
contained in this Agreement shall be true, complete and
accurate as and when made and at and as of the Closing;
(b) The Vendor shall have performed and complied with all of the
covenants, terms and conditions in this Agreement to be
performed or complied with by it at or before Closing;
(c) The Purchaser shall have received at or before the Closing
from the Vendor the following documents, dated as of the
Completion Date, prepared and/or delivered at the expense of
the Vendor:
(i) such instruments or agreements of sale, transfer,
conveyance, assignment or delivery, in registrable
form or otherwise, in respect of the Vendor's 50%
interest in and to the Bachelor Property, together
with its 50% Participating Interest, and the Vendor's
rights in respect of the Existing Royalties and the
Wolfden Royalty, as the Purchaser may reasonably
require to effect the full and effective sale,
transfer, conveyance, assignment or delivery thereof
to the Purchaser; and
(ii) such other documents, certificates and other
instruments as would be usual in respect of the
transactions contemplated herein or as the Purchaser
may reasonably require.
7.2 CONDITIONS PRECEDENT IN FAVOUR OF THE VENDOR. The obligations of the
Vendor to complete the Purchase Transaction contemplated in this
Agreement shall be subject to the satisfaction of, or compliance with,
at or before the Completion Date, each of the following conditions
-6-
precedent (each of which is hereby acknowledged to be inserted for the
exclusive benefit of the Vendor and may be waived by it in writing in
whole or in part):
(a) Each of the representations and warranties of the Purchaser
contained in this Agreement shall be true, complete and
accurate as and when made and at and as of the Closing;
(b) The Purchaser shall have performed and complied with all of
the covenants, terms and conditions in this Agreement to be
performed or complied with by it at or before Closing;
(c) The Vendor shall have received at the Closing from the
Purchaser the following payments and documents, dated as of
the Completion Date, prepared at the expense of the Purchaser
and in form and substance satisfactory to the Vendor:
(i) $3,500,000 in cash or by certified cheque or bank
draft or by wire transfer in immediately available
funds;
(ii) a duly registered and issued share certificate, dated
as of the Completion Date, representing the Purchase
Shares and embossed in the name of the Vendor;
(iii) such documents, certificates, legal opinions and
other instruments in respect of the completion of the
Purchase Transaction and the issuance and listing for
trading of the Purchase Shares, as the Vendor may
reasonably require; and
(iv) an assumption agreement in respect of the costs,
charges, expenses and liabilities contemplated in
section 3.2(a), the 50% Participating Interest of the
Vendor and in respect of the Existing Royalties and
the Wolfden Royalty; and
(d) The Purchaser shall have entered into with, and delivered the
NSR Agreement to, the Vendor.
ARTICLE 8 -- MISCELLANEOUS -- GENERAL
8.1 FURTHER ASSURANCES. Each Party shall do such acts and shall execute
such further documents, conveyances, deeds, assignments, transfers and
other instruments, and will cause the doing of such acts and will cause
the execution of such further documents as are within its power as the
other Party may in writing at any time and from time to time reasonably
request be done and/or executed, in order to complete the Purchase
Transaction and to give full effect to the provisions of this Agreement
and all documents delivered at Closing.
8.2 NOTICE. Any notice to be given to one Party hereto by another Party
hereto may be sent by facsimile or e-mail or may be personally
delivered as follows:
-7-
In the case of the Purchaser:
Metanor Resources Inc.
0000 xxxxxx Xxxxxxxx
Xxxxx 0
Xxx-x'Xx, Xxxxxx X0X 0X0
Attention: President
Fax: (000) 000-0000
e-mail: xxxxxxxxxx.xxxxxxx@xxxxxxxxxxx.xx.xx
In the case of the Vendor:
Halo Resources Ltd.
0000 - 000 Xxxx Xxxxxx
Xxxxxxxxx, Xxxxxxx Xxxxxxxx X0X 0X0
Attention: President
Fax: (000) 000-0000
e-mail: xxxxxxxxxxx@xxxxxxx.xxx
or to any other addresses or persons that any Party may at any time
designate by written notice to the other Party.
Any notice, request, consent or other communication shall be
conclusively deemed to have been given and received (i) on the day of
actual delivery if given by personal delivery; or (ii) on the day of
transmittal if given by facsimile or e-mail prior to 5:00 p.m. on a
business day and on the next following business day if given by
facsimile or e-mail after 5:00 p.m. on a business day.
8.3 GOVERNING LAWS. This Agreement shall be governed by and interpreted in
accordance with the laws of the Province of Quebec.
8.4 PERFORMANCE ON HOLIDAYS. If any action is required to be taken pursuant
to this Agreement on or by a specified date that is not a business day
in the Province of Quebec, then such action shall be valid if taken on
or by the next succeeding business day.
8.5 EXPENSES. Each Party hereto shall pay all expenses it incurs in
authorizing, preparing, executing and performing this Agreement and the
transactions contemplated hereunder, whether or not the Closing occurs,
including all fees and expenses of its legal counsel, accountants or
other representatives or consultants.
8.6 TIME. Time is of the essence of each provision of this Agreement.
8.7 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the Parties with respect to the subject matter hereof. The
execution of this Agreement has not been induced by nor do the Parties
rely upon or regard as material, any covenants, representations or
warranties whatsoever not incorporated herein and made a part hereof.
-8-
8.8 PUBLIC ANNOUNCEMENTS. No Party shall publicly disclose the specific
terms of this Agreement except as may be necessary in the opinion of
counsel to the Party making such disclosure to comply with the
requirements of any Governmental authority or regulatory authority
having jurisdiction. No public statement or press release shall be made
by any Party unless such Party intending to make such disclosure shall
consult with the other Party prior to making such statement or press
release, and each Party shall use all reasonable efforts, acting in
good faith, to agree upon a text for such statement or press release
which is satisfactory to each Party.
8.9 COUNTERPARTS. This Agreement may be executed in counterparts and
delivered by facsimile transmission. Each executed counterpart shall be
deemed to be an original and each executed counterpart taken together
shall constitute one agreement. In the event that either Party delivers
this Agreement by facsimile transmission then such Party shall
forthwith deliver the original executed copy of this Agreement to the
other Party.
8.10 CURRENCY. All amounts in this Agreement are stated and are payable in
Canadian funds.
8.11 ASSIGNMENT. Neither Party may assign any rights or benefits under this
Agreement, including the benefit of any representation or warranty, to
any third party without the prior written consent of the other Party.
Each Party agrees to perform its obligations under this Agreement, and
shall not arrange in any way for any other third party to perform those
obligations. No assignment of benefits or arrangement for substituted
performance by one Party shall be of any effect against any other Party
except to the extent that such other Party has consented to it in
writing.
IN WITNESS WHEREOF this Agreement has been done and executed in Montreal,
Province of Quebec as to the Purchaser and Toronto, Ontario as to the Vendor,
with effect on the date hereinabove mentioned.
METANOR RESOURCES INC.
________________________ By: _____________________________
Witness Xxxxx Xxx, President
________________________
Witness
-9-
HALO RESOURCES LTD.
________________________ By: _____________________________
Witness Marc Cernovitch, President
and Chief Executive Officer
________________________
Witness
-10-
SCHEDULE "A"
THIS IS SCHEDULE "A" OF THE AGREEMENT ENTERED INTO AS OF THE 27TH DAY OF APRIL
2006 BETWEEN HALO RESOURCES LTD. AND RESOURCES METANOR INC.
DESCRIPTION OF PROPERTY
A) THE BACHELOR PROPERTY
--------------------------------------------------------------------------------
CLAIMS RANGE LOT TOWNSHIP
--------------------------------------------------------------------------------
CLO257181 IV 27 Le Sueur
--------------------------------------------------------------------------------
CLO257182 V 24,25 Le Sueur
--------------------------------------------------------------------------------
XXX000000 V 22,23 Le Sueur
--------------------------------------------------------------------------------
CLO257184 V 20 Le Sueur
--------------------------------------------------------------------------------
CLO257185 V 18,19,20 Le Sueur
--------------------------------------------------------------------------------
XXX000000 IV 26 Le Sueur
--------------------------------------------------------------------------------
CLO257192 IV 24 Le Sueur
--------------------------------------------------------------------------------
CLO257193 IV 21 Le Sueur
--------------------------------------------------------------------------------
CLO257194 IV 19 Le Sueur
--------------------------------------------------------------------------------
CLO257205 III 18 Le Sueur
--------------------------------------------------------------------------------
XXX000000 III 19 Le Sueur
--------------------------------------------------------------------------------
CLO257231 IV 25 Le Sueur
--------------------------------------------------------------------------------
CLO257232 IV 23 Le Sueur
--------------------------------------------------------------------------------
XXX000000 IV 22 Le Sueur
--------------------------------------------------------------------------------
CLO257234 IV 20 Le Sueur
--------------------------------------------------------------------------------
CLO257235 IV 18 Le Sueur
--------------------------------------------------------------------------------
CLO267941 V 17 Le Sueur
--------------------------------------------------------------------------------
CLO267942 V 15 Le Sueur
--------------------------------------------------------------------------------
CLO267955 V 18 Le Sueur
--------------------------------------------------------------------------------
CL3742541 II 13 Le Sueur
--------------------------------------------------------------------------------
XX0000000 II 14 Le Sueur
--------------------------------------------------------------------------------
CL3742551 II 15 Le Sueur
--------------------------------------------------------------------------------
CL3742552 II 16 Le Sueur
--------------------------------------------------------------------------------
CL3742561 II 17 Le Sueur
--------------------------------------------------------------------------------
CL3742562 II 18 Le Sueur
--------------------------------------------------------------------------------
CL3742571 II 19 Le Sueur
--------------------------------------------------------------------------------
CL3742572 II 20 Le Sueur
--------------------------------------------------------------------------------
CL3742581 III 13 Le Sueur
--------------------------------------------------------------------------------
CL3742582 III 14 Le Sueur
--------------------------------------------------------------------------------
XX0000000 III 15 Le Sueur
--------------------------------------------------------------------------------
CL3742584 III 16 Le Sueur
--------------------------------------------------------------------------------
CL3742712 II 10 Le Sueur
--------------------------------------------------------------------------------
CL3742721 II 11 Le Sueur
--------------------------------------------------------------------------------
CL3742722 II 12 Le Sueur
--------------------------------------------------------------------------------
CL3742731 III 17 Le Sueur
--------------------------------------------------------------------------------
CL3812031 Xxx 00 Xxx 00 Xx Xxxxx
--------------------------------------------------------------------------------
Cl3734191 III 27 Le Sueur
--------------------------------------------------------------------------------
Cl3734192 III 28 Le Sueur
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
CLAIMS RANGE LOT TOWNSHIP
--------------------------------------------------------------------------------
CL3734201 III 29 Le Sueur
--------------------------------------------------------------------------------
CL3734202 III 30 Le Sueur
--------------------------------------------------------------------------------
CL3734211 III 31 Le Sueur
--------------------------------------------------------------------------------
CL3734212 II 21 Le Sueur
--------------------------------------------------------------------------------
CL3734221 II 22 Le Sueur
--------------------------------------------------------------------------------
CL3742651 III 19 Le Sueur
--------------------------------------------------------------------------------
CL3742652 III 20 Le Sueur
--------------------------------------------------------------------------------
CL3742661 III 21 Le Sueur
--------------------------------------------------------------------------------
CL3742662 III 22 Le Sueur
--------------------------------------------------------------------------------
CL3742771 III 23 Le Sueur
--------------------------------------------------------------------------------
CL3742772 III 24 Le Sueur
--------------------------------------------------------------------------------
XX0000000 III 25 Le Sueur
--------------------------------------------------------------------------------
CL3742782 III 26 Le Sueur
--------------------------------------------------------------------------------
CM478 - - Le Sueur
--------------------------------------------------------------------------------
CM510 - - Le Sueur
--------------------------------------------------------------------------------
B) THE HEWFRAN PROPERTY
CLAIM TOWNSHIP EXPIRY DATE
----- -------- -----------
3252153 Lesueur Oct 16,2005
3252154 Lesueur Oct 16,2005
3252155 Lesueur Oct 16,2005
3197781 Xxxxxxx Xxx 07,2007
3197782 Xxxxxxx Xxx 07,2007
3197783 Xxxxxxx Xxx 07,2007
3197784 Xxxxxxx Xxx 07,2007
3197785 Xxxxxxx Xxx 07,2007
3197791 Xxxxxxx Xxx 07,2007
3645873 Xxxxxxx Feb 06,2007
3145911 Xxxxxxx Feb 08,2007
3145912 Xxxxxxx Feb 08,2007
3645604 Xxxxxxx Feb 09,2007
3645605 Xxxxxxx Feb 09,2007
3645611 Xxxxxxx Feb 09,2007
3645762 Xxxxxxx Feb 08,2007
3645694 Xxxxxxx Feb 11,2007
3069781 Xxxxxxx May 14,2007
3069783 Xxxxxxx May 14,2007
-2-
CLAIM TOWNSHIP EXPIRY DATE
----- -------- -----------
3069791 Xxxxxxx May 14,2007
3069812 Xxxxxxx May 14,2007
3069813 Xxxxxxx May 14,2007
3080441 Xxxxxxx May 14,2007
3011591 Xxxxxxx Jun 15,2007
3011592 Xxxxxxx Jun 15,2007
3083911 Xxxxxxx Jun 15,2007
3083912 Xxxxxxx Jun 15,2007
3083913 Xxxxxxx Jun 15,2007
3083914 Xxxxxxx Jun 15,2007
3083921 Xxxxxxx Jun 15,2007
3083922 Xxxxxxx Jun 15,2007
3083923 Xxxxxxx Jun 15,2007
3083924 Xxxxxxx Jun 15,2007
3083925 Xxxxxxx Jun 15,2007
3087671 Xxxxxxx Aug 18,2007
3087672 Xxxxxxx Aug 18,2007
3087681 Xxxxxxx Aug 18,2007
3087682 XXXXXXX AUG 18,2007
--------------------------------------------------------------
38 CLAIM
C) THE XXXXXX PROPERTY
MJL EXPLORATION
----------------------------------------------------------------------------------------------------------------
CLAIM RANGE LOT TITLE NO. DATE MATURITY DATE SURFACE (HA)
----------------------------------------------------------------------------------------------------------------
32F08 2 1 0003270 2003/09/15 2005/09/14 31.44
32F08 2 2 0003271 2003/09/15 2005/09/14 42.31
32F08 2 3 0003272 2003/09/15 2005/09/14 42.31
32F08 2 4 0003273 2003/09/15 2005/09/14 42.31
32F08 2 5 0003274 2003/09/15 2005/09/14 42.32
32F08 2 6 0003275 2003/09/15 2005/09/14 42.32
32F08 2 7 0003276 2003/09/15 2005/09/14 42.32
32F08 2 8 0003277 2003/09/15 2005/09/14 42.33
32F08 2 9 0003278 2003/09/15 2005/09/14 42.32
32F08 3 5 0003279 2003/09/15 2005/09/14 43.02
32F08 3 6 0003280 2003/09/15 2005/09/14 43.00
32F08 3 7 0003281 2003/09/15 2005/09/14 42.98
32F08 3 8 0003282 2003/09/15 2005/09/14 10.32
-3-
----------------------------------------------------------------------------------------------------------------
CLAIM RANGE LOT TITLE NO. DATE MATURITY DATE SURFACE (HA)
----------------------------------------------------------------------------------------------------------------
32F08 & F09 4 7 0003283 2003/09/15 2005/09/14 41.85
32F08 & F09 4 8 0003284 2003/09/15 2005/09/14 38.35
32F08 (25) (33) 0003285 2003/09/15 2005/09/14 55.96
32F08 (25) (34) 0003286 2003/09/15 2005/09/14 55.96
32F08 (25) (35) 0003287 2003/09/15 2005/09/14 40.52
32F08 (26) (33) 0003288 2003/09/15 2005/09/14 55.96
32F08 (26) (34) 0003289 2003/09/15 2005/09/14 55.96
32F08 (26) (35) 0003290 2003/09/15 2005/09/14 40.44
32F09 5 26 0003291 2003/09/15 2005/09/14 15.63
32F09 5 27 0003292 2003/09/15 2005/09/14 15.64
32F09 5 28 0003293 2003/09/15 2005/09/14 36.69
32F09 5 29 0003294 2003/09/15 2005/09/14 36.69
32F09 6 28 0003295 2003/09/15 2005/09/14 42.58
32F09 6 29 0003296 2003/09/15 2005/09/14 41.84
32F08 BLOC 11 0008367 2003/12/09 2005/12/08 18.70
32F08 BLOC 14 0008368 2003/12/09 2005/12/08 19.22
32F09 (2) (39) 0013637 2004/02/17 2006/02/16 16.59
32F09 (2) (40) 0013638 2004/02/17 2006/02/16 17.24
32F09 (3) (39) 0013639 2004/02/17 2006/02/16 53.29
32F09 (3) (40) 0013640 2004/02/17 2006/02/16 55.89
32F09 (4) (39) 0013641 2004/02/17 2006/02/16 23.16
32F09 (4) (40) 0013642 2004/02/17 2006/02/16 24.44
32F08 BLOC 10 0015481 2004/02/17 2006/03/04 23.46
32F09 (20) (13) 5268741 2003/11/07* 2005/11/06 16.00
32F09 (21) (11) 5268742 2003/11/07* 2005/11/06 16.00
32F09 (21) (10) 5268743 2003/11/07* 2005/11/06 16.00
32F09 (21) (09) 5268744 2003/11/07* 2005/11/06 16.00
32F09 (22) (09) 5268745 2003/11/07* 2005/11/06 16.00
32F09 (22) (10) 5268746 2003/11/07* 2005/11/06 16.00
32F09 (22) (11) 5268747 2003/11/07* 2005/11/06 16.00
32F09 (23) (11) 5268748 2003/11/07* 2005/11/06 16.00
32F09 (23) (10) 5268749 2003/11/07* 2005/11/06 16.00
32F09 (23) (09) 5268750 2003/11/07* 2005/11/06 16.00
32F09 (24) (09) 5268751 2003/11/07* 2005/11/06 16.00
32F09 (24) (10) 5268752 2003/11/07* 2005/11/06 16.00
32F09 (24) (11) 5268753 2003/11/07* 2005/11/06 16.00
32F09 (24) (12) 5268754 2003/11/07* 2005/11/06 16.00
32F09 (23) (12) 5268755 2003/11/07* 2005/11/06 16.00
32F09 (22) (12) 5268756 2003/11/07* 2005/11/06 16.00
32F09 (22) (13) 5268757 2003/11/07* 2005/11/06 16.00
32F09 (23) (13) 5268758 2003/11/07* 2005/11/06 16.00
32F09 (24) (13) 5268759 2003/11/07* 2005/11/06 16.00
32F09 (24) (14) 5268760 2003/11/07* 2005/11/06 16.00
32F09 (24) (15) 5268761 2003/11/07* 2005/11/06 16.00
32F09 (23) (15) 5268762 2003/11/07* 2005/11/06 16.00
32F09 (23) (14) 5268763 2003/11/07* 2005/11/06 16.00
32F09 (22) (14) 5268764 2003/11/07* 2005/11/06 16.00
32F09 (22) (15) 5268765 2003/11/07* 2005/11/06 16.00
32F09 (24) (16) 5268766 2003/11/07* 2005/11/06 16.00
32F09 (24) (17) 5268767 2004/02/20* 2006/02/19 16.00
-4-
----------------------------------------------------------------------------------------------------------------
CLAIM RANGE LOT TITLE NO. DATE MATURITY DATE SURFACE (HA)
----------------------------------------------------------------------------------------------------------------
32F09 (23) (17) 5268768 2004/02/20* 2006/02/19 16.00
32F09 (23) (16) 5268769 2003/11/07* 2005/11/06 16.00
32F09 (22) (16) 5268770 2003/11/07* 2005/11/06 16.00
32F09 (22) (17) 5268771 2004/02/20* 2006/02/19 16.00
32F09 (21) (17) 5268772 2004/02/20* 2006/02/19 16.00
32F09 (21) (16) 5268773 2003/11/07* 2005/11/06 16.00
32F09 (21) (15) 5268774 2003/11/07* 2005/11/06 16.00
32F09 (20) (15) 5268775 2003/11/07* 2005/11/06 16.00
32F09 (20) (16) 5268776 2003/11/07* 2005/11/06 16.00
32F09 (20) (17) 5268777 2003/11/07* 2005/11/06 16.00
32F09 (19) (17) 5268778 2003/11/07* 2005/11/06 16.00
32F09 (19) (16) 5268779 2003/11/07* 2005/11/06 16.00
32F09 (19) (15) 5268780 2003/11/07* 2005/11/06 16.00
-------
TOTAL : 1975.36
=======
JENSHANSEN
----------------------------------------------------------------------------------------------------------------
CLAIM RANGE LOT TITLE NO. DATE MATURITY DATE SURFACE (HA)
----------------------------------------------------------------------------------------------------------------
32F09 6 7 0003206 2003/09/15 2005/09/14 42.32
32F09 6 8 0003207 2003/09/15 2005/09/14 42.30
32F08 Bloc 2 0 0003208 2003/09/15 2005/09/14 27.51
32F08 Bloc 3 0 0003209 2003/09/15 2005/09/14 22.36
32F08 Bloc 4 0 0003210 2003/09/15 2005/09/14 17.87
32F08 Bloc 5 0 0003211 2003/09/15 2005/09/14 15.80
32F08 Bloc 6 0 0003212 2003/09/15 2005/09/14 9.92
32F08 Bloc 7 0 0003213 2003/09/15 2005/09/14 19.96
32F08 Bloc 8 0 0003214 2003/09/15 2005/09/14 27.08
32F08 Bloc 9 0 0003215 2003/09/15 2005/09/14 29.10
32F08 Bloc 15 0 0003216 2003/09/15 2005/09/14 25.20
32F08 Bloc 16 0 0003217 2003/09/15 2005/09/14 31.91
------
TOTAL: 311.33
======
-5-
SCHEDULE "B"
THIS IS SCHEDULE "B" OF THE AGREEMENT ENTERED INTO AS OF THE 27TH DAY OF APRIL
2006 BETWEEN HALO RESOURCES LTD. AND RESOURCES METANOR INC.
NET SMELTER RETURNS ROYALTY
1. INTERPRETATION
Where used in this Schedule "B":
(a) "Agreement" means the Purchase Agreement to which this
schedule is attached, including any amendments thereto or
renewals or extensions thereof.
(b) "Bachelor Property" means those mining properties described in
Schedule "A" of the Agreement.
(c) "Fiscal Period" means each calendar year or other period of 12
consecutive months adopted by the payor of the Halo Royalty
for accounting and tax purposes.
(d) "Halo Royalty" means the 1.0% Net Smelter Returns royalty
payable pursuant to the terms of the Agreement.
(e) Other defined terms used but not defined in this Schedule "B"
shall have the meanings ascribed thereto in the Agreement.
2. NET SMELTER RETURNS
"Net Smelter Returns" shall mean the gross proceeds received by the payor of the
Halo Royalty from the sale or other disposition of minerals, ores, metals
(metals shall include, precious metals and metals other than precious metals) or
concentrates of metals produced from the Bachelor Property or from other ore
bodies controlled or owned by the Purchaser and sold, less the following
expenses if actually incurred:
(a) taxes specifically based on mining production, but excluding
any and all taxes (i) based upon the net or gross income of
the owner or other operator of the Property or the payor of
the Royalty Interest and (ii) based upon the value of the
Property, the privilege of doing business and other similarly
based taxes;
(b) charges and costs, if any, for transportation and insurance of
ores, metals (metals shall include, precious metals and metals
other than precious metals) or concentrates of metals produced
from the Property to any mint, smelter, or refinery; and
(c) charges, costs (including assaying and sampling costs) and all
penalties, if any, charged by a smelter or refiner of ores,
metals (metals shall include, precious metals and metals other
than precious metals) or concentrates of metals produced from
the Property.
3. PAYMENT
(a) The Halo Royalty shall be paid in cash only on a quarterly
basis within 15 days after the end of each fiscal quarter
during the relevant Fiscal Period;
(b) Each payment under subsection 3(a) shall be accompanied by a
statement indicating the calculation of Net Smelter Returns.
The Halo Royalty holder shall be entitled to audit, during
normal business hours, such books and records as are necessary
to determine the correctness of the payment of the Halo
Royalty provided, however, that such audit may be made once
only on an annual basis and within 12 months of the end of the
Fiscal Period in respect of which such audit is made; and
(c) Payment of the Halo Royalty shall be made to the Halo Royalty
holder at such place or places as the Halo Royalty holder
shall advise the payor from time to time.
4. REGISTRATION/TRANSFER OF THE PROPERTY
The Halo Royalty holder shall be entitled to register the NSR Agreement against
title to the Bachelor Property with the intention of the Parties that it shall
run with and bind the title to the Bachelor Property and be binding on all
successive title holders thereof. The owner of the Bachelor Property shall be
entitled to transfer all or part of such title in and to the Bachelor Property
to any third party, provided that such third party shall agree in writing to be
bound by the terms of the NSR Agreement to the extent of such interest in the
Bachelor Property acquired and, in such circumstances, the transferor of such
interest in and to the Bachelor Property shall be released from all obligations
in respect of the Halo Royalty accruing from and after the date of such
transfer.
-2-
