Exhibit 6.3
PURCHASE CONTRACT
The undersigned XXXXXXX XXXXXXXX acting on behalf of COMPANIA XXXXXX XXXXXXX, S.
A. a corporation duly registered in the Public Registry of Panama at microfiche
447555, document 577369 of the Mercantile Microfilm Section, duly authorized for
this act by a Board of Directors resolution of said corporation, which is
attached to this contract (attachment 1), hereinafter called XXXXXXX; and XXXXX
X. XXXXXXXXX, acting on behalf of the corporation TRANSWORLD EXPLORATION, S. A.
a corporation duly registered in the Public Registry at microfiche 053813, Roll
3741 and Image 0017, of the Mercantile Microfiche Section, duly authorized for
this act by shareholder's resolution of said corporation, which is attached to
this contract (attachment 2), hereinafter called TRANSWORLD, and XXXXXXX
XXXXXXXXX, acting on behalf of BANCO PANAMERICANO, S. A. corporation registered
in the Public Registry of Panama at microfiche 85971, roll 8104, Image 109 of
the Mercantile Microfiche Section, hereinafter called PANABANK.
RECITALS
That TRANSWORLD holds an Exploitation Concession of Mineral Class IV (gold and
Silver) granted by the Republic of Panama, as it stated in contract No. 10 of
October 4, 1988; covering 2, 400 hectares and the Remance Mine ("Concession"),
(attachment 3)
That PANABANK holds some legal rights over certain equipment, machinery and land
located within the Concession.
That XXXXXXX entered into a Letter of Intent dated December 15, 2003 with
TRANSWORLD by virtue of which the latter granted an Option Period ("Option") for
the purchase of the aforementioned Concession.
That XXXXXXX has exercised the Option and desires to purchase the
Therefore, based on the above, the parties agree to enter in this contract as
follows:
FIRST: PURCHASE PRICE. TERMS AND CONDITIONS: XXXXXXX will purchase the
Concession, subject to the following terms and conditions:
X. XXXXXXX will pay TRANSWORLD the amount of FIVE HUNDRED THOUSANDS
DOLLARS (US$500,000.00), according to the following schedule.
i) US$15,000.00 upon exercise of the Option and signing of this
contract.
ii) Thereafter, US$15,000.00 per quarter, three quarterly
payments, until the first anniversary of this Contract.
iii) Thereafter, US$40,000.00 per quarter, four quarterly
payments, until the second anniversary of this contract.
iv) Thereafter, US$70,000.00 per quarter, four quarterly
payments, until the third anniversary of this contract.
B. TRANSWORLD will receive a 2% Net Smelter Return Royalty ("NSR")
for a gold price up to US$399.99 per ounce and 3% NSR Royalty for
a gold price of US$400.00 per ounce and above, up to US$600.00
per ounce. For US$601.00 and above a 2% NSR Royalty for the price
excedent above US$600.00. This NSR Royalty is conveyed by the
execution of the Royalty Agreement attached to this contract.
(attachment 4)
X. XXXXXXX hereby agrees and commits to make the necessary
investment to build a mine facility at the Concession with an
installed mill capacity of 300 tons per day and place the mine in
commercial production in a thirty-six month period from execution
date of this contract.
SECOND: TRANSFER OF CONCESION: Once the first payment of US$15,000.00 is made
TRANSWORLD will initiate the process to transfer the
The parties agree to execute an escrow agreement and designate an escrow agent
within 30 days of the execution of this contract.
FOURTH: OCCUPATION RIGHTS: Upon execution of this contract XXXXXXX will have the
right to enter upon the concession and carry out the following:
A. Exploring for all Ores and Minerals which may be found in, on or
under the Concession, including without limitation, conducting
such geological and geophysical investigations, mapping and
subsurface drilling as XXXXXXX xxxxx advisable;
B. Mining (whether by underground, open pit, solution or other
methods now known or hereafter developed), stockpiling, removing,
shipping, processing, marketing or otherwise disposing of all
Ores and Minerals;
C. Placing and using on the Concession excavations, openings,
shafts, ditches and drains;
D. Constructing, erecting, operating, maintaining, using and, at its
election, removing any and all vehicles, drilling rigs,
buildings, structures, plants, machinery, equipment, railroads,
pipelines, electrical power lines and facilities, stockpiles,
waste piles, tailing ponds, setting ponds, heap leaching
facilities and all other improvements, property and fictures as
may be necessary, convenient or suitable for mining, removing,
beneflciating, concentrating, smelting, extracting, leaching,
refining and shipping of Ores and Minerals or products thereof,
or for any activities incidental thereto, or to any of the rights
or privileges of XXXXXXX under this CONTRACT.
X. XXXXXXX is granted the right, insofar as TRANSWORLD may lawfully
grant the right, to divert streams; to remove lateral and
subjacent support, to cave, subside or destroy all or any parts
of the Concession where it will not interfere with mining, and to
xxxxx ore; all to the extent necessary, usual or customary in
carrying our any or all of the above referenced rights,
privileges and purposes in a reasonable manner.
FIFTH: CLIFTON'S CONTRACTUAL RIGHTS DURING THE INTERIN PERIOD:
The time period between the evecution of this contract and the transfer of the
TRANSWORLD to submit this request to DGRM, XXXXXXX should provide the
documentation listed in attachment 5.
SIXTH: CONCESSION'S SUPERFICIAL TAXES: TRANSWORLD recognizes that the concession
superficial taxes have not been paid for the past three years. XXXXXXX agrees to
assume responsibility for payment of this taxes upon execution of this contract
and 50% of this payment will be deducted from the last portion of the payment of
the cash purchase price stated in clause 1A (IV).
SEVENTH REPRESENTATION AND WARRANTIES:
A. TRASWORLD Representation:
1. TRANSWORLD has full power and authority to enter into this
Agreement and the provisions hereof constitute legal and binding
obligations of TRANSWORLD enforceable in accordance with their
terms. To the best of its knowledge neither the execution and
delivery of this agreement nor compliance by TRANSWORLD with any
of the provisions hereof, will conflict with or result in a
breach of any agreement or instrument to which TRANSWORLD is a
party or of any law, government, or administrative regulation or
restriction applicable to it.
2. There are no actions, suits, claims, proceedings, litigation or
investigations pending, or to the Best of TRANSWORLD'S knowledge,
threatened against TRANSWORLD at law or inequity, or by any court
or other governmental instrumentality which related to this
Agreement, or the concession, or which could if continued,
adversely affect TRANSWORLD's ability to fulfill the obligations
undertaken hereby, or XXXXXXX ability to explore or develop the
Remance Area.
3. TRANSWORLD is the holder of the Concession described in
attachment 3 free and clear of all liens, claims, encumbrances,
defects or objections subject only to the paramount title of the
of Panama and the terms and conditions thereof. TRANSWORLD has o
not previously transferred or encumbered its interest in the
Concession and has no knowledge that any other person or entity
abandonment, relinquishment or other premature termination of the
Concession.
X. XXXXXXX'x Representation:
1. XXXXXXX has full power and authority to enter into this Agreement
and the provisions hereof constitute legal and binding
obligations of XXXXXXX enforceable in accordance with their
terms. To the best of its knowledge neither the execution and
delivery of this agreement nor compliance by XXXXXXX with any of
the provisions hereof, will conflict with or result in a breach
of any agreement or instrument to which XXXXXXX is a party or of
any law, government, or administrative regulation or restriction
applicable to it.
2. There are no actions, suits, claims, proceeding, litigation or
investigations pending, or to the best of CLIFTON's knowledge,
threatened against XXXXXXX at law or inequity, or by any court or
other governmental instrumentality which related to this
Agreement, or the concession, or which could if continued,
adversely affect CLIFTON's ability to fulfill the obligations
undertaken hereby, or XXXXXXX ability to explore or develop the
Remance Area.
EIGHT: ENVIRONMENTAL MATTERS: The concession is currently in compliance with
environmental regulations for a non operating mine. Once XXXXXXX defines the new
mine plan and design, an Environmental Management Program (PAMA) will have to be
prepared and submitted to the Environmental Authorities for their review and
approval.
NINTH: LAND MACHINERY AND EQUIPMENT: The concession covers 2, 40O hectares and
the immediate Remance Mine are covers 350 hectares. The possesory rights
covering the immediate Remance Mine Area have been purchased. A detailed
description of the land holdings is included in attachment 6. Both TRANSWORLD
and PANABANK agree to grant access and uses of the land to XXXXXXX without any
restrictions or as long as the mining
TENTH: CONCESSION'S GOOD STANDING: Except as disclosed in Clause: SIX, the
concession is in good standing.
ELEVENTH: TERMINATION: This contract will be terminated if any of the following
situations occurs:
A. By mutual agreement.
B. Due to default attributed to one of the parties wherein the non-
complying party shall have a period of thirty (30) days to remedy
the default, as from the day of notice received from other party
informing of said non-compliance.
X. XXXXXXX can terminate this contract with a 30 day notice period
by making one additional quarterly payment and returning the
concession to TRANSWORLD.
D. If this contract is terminated by failure of XXXXXXX to comply
with the payments listed in clause 1A, XXXXXXX will return the
concession to TRANSWORLD.
TWELVETH: FORCE MAJEURE: In case of fortuitous case or force majeure, all the
periods of time or terms indicated in this contract which are related to the
fulfillment of any of the obligations assumed by the parties, will be prolonged
for a period equal to the period of delay.
THIRTEENTH: ARBITRATION: Any claim or controversy arising from or related to
this agreement, as well as the interpretation, application, execution and
termination of this document should be resolved through an arbitration, after
attempting a conciliation, by the Panamanian Arbitration and Conciliation
Center, and based to its procedures rules.
FOURTEENTH: NOTICES: Any notice, election, report or other correspondence
required or permitted hereunder shall be in writing and shall be sufficiently
given if (i) delivered personally to an officer of the party to whom directed
(ii) sent by registered or certified mail, postage prepaid, return receipt
requested of currior (iii) sent by fax or electronic mail. All such notices
shall be addressed.
TRINIDAD: Compania Minera La Trinidad, S. A.
Courier Address:
Xxxxx 00, Xx. 00 Xxx Xxxxxxxxx
Xxxxxx Xxxx
Mail Address:
Xxxxxxxx 0000, Xxxx 0x
Xxxxxx, Xxxxxx
Attn: Xxxxx X. Xxxxxxxxx
Phone: (000)000-0000
Fax: (000)000-0000
E-mail: invgeo@cableonda. net
PANABANK: Banco Panamericano, S. A.
Courier Address:
Xxxxx 00, Xxxxxxxx Xxxxxxxx
Xxxxxx Xxxx
Mail Address:
Xxxxxxxx 0000, Xxxx 0
Xxxxxx, Xxxxxx
Attn: Xxxxxxx Xxxxxxxxx
Fax: (000)000-0000
XXXXXXX: Compania Xxxxxx Xxxxxxx, S.A.
Courier Address:
00 Xxxxxx Xxxx
Xxxxxx, XX 00000
Xxxxxx Xxxxxx of America
Mail Address:
00 Xxxxxx Xxxx
Xxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxxx
Phone: (000) 000-0000 / (000)000-0000
Fax: (000) 000-0000
e-mail: xxxxxxxxxx00000@xxxxx.xxx
FIFTEENTH: COUNTERPARTS: This contract may be executed in any number of
counterparts. Each executed counterpart shall be deemed to be an All executed
contemplate taken together shall constitute one agreement.
SEVENTEENTH: APLLICABLE LAW: This Contract will be governed by and construed
under the laws and principles of the Republic of Panama without regard to
conflicts of laws principles.
This contract is signed and executed in three originals.
Panama, February 20, 2004.
COMPANIA XXXXXX XXXXXXX, S. A. TRANSWORLD EXPLORATION, S. A
/s/ Xxxxxxx Xxxxxxxx /s/ Xxxxx X. Xxxxxxxxx
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Xxxxxxx Xxxxxxxx Xxxxx X. Xxxxxxxxx
BANCO PANAMERICANO, S.A. (PANABANK)
/s/ Xxxxxxx Xxxxxxxxx /s/ Xxxxxxx Xxxxx
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Xxxxxxx Xxxxxxxxx Xxxxxxx Xxxxx
