KILIMANJARO MINING COMPANY, INC.
Exhibit
10.2
KILIMANJARO
MINING COMPANY, INC.
▇▇▇
▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
June 1,
2009
▇▇. ▇▇▇▇▇
▇. ▇▇▇▇▇▇
President
and Chief Executive Officer
▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Dear ▇▇.
▇▇▇▇▇▇:
The
purpose of this Binding Letter Agreement (“BLA”) is to set out the terms of a
definitive agreement to be entered into between Lake Victoria Mining Company,
Inc. (“LVCA”) a publicly traded company incorporated under the laws of the State
of Nevada with an office address at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
and Kilimanjaro Mining Company Inc. (“Kilimanjaro”) a private corporation
existing pursuant to the laws of the State of Nevada with a registered address
at ▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ wherein LVCA would
acquire up to a one hundred percent controlling interest (100%) in Kilimanjaro
pursuant to a share exchange or issuance described as follows:
A. Background
Facts
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1.
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LVCA
has represented the following:
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(a)
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LVCA
is a corporation incorporated under the laws of the State of
Nevada.
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(b)
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LVCA
is a reporting issuer in the state of Nevada,
U.S.A.;
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(c)
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The
common shares of LVCA are listed and posted for trading on the NASDAQ OTC:
BB Exchange – (“Exchange”);
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(d)
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LVCA
has issued and outstanding 28,478,300 common shares (each a “LVCA Share”
and collectively the “LVCA
Shares”);
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(e)
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As
at the Closing Date as herein after defined, LVCA will have working
capital allocated or will raise additional capital to carry out the terms
to the end of the first year of the Definitive
Agreement.
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2.
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Kilimanjaro
has represented the following:
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(a)
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That
it is a private corporation incorporated under the laws of the state of
Nevada, U.S.A. with a registered office at ▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇; and
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(b)
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Kilimanjaro
has issued and outstanding 33,032,277 common shares (each a “Kilimanjaro
Share” and collectively the “Kilimanjaro
Shares”);
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(c)
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Kilimanjaro
is in the process of accepting up to USD$2 million in Private Placement
funds from Accredited Investors to complete the Initial and Secondary
Payments for the acquisition of a new gold project area in Central
Tanzania. This is a property area in addition to the mineral prospecting
licenses that it currently holds.
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B. Proposal
The
proposed terms of the definitive agreement are generally described as the plan
for LVCA to acquire up to 100% of Kilimanjaro pursuant to a securities exchange
or issuance. By July 1, 2009, LVCA and Kilimanjaro will complete a Securities
Exchange Agreement (the “Definitive Agreement”) whereby LVCA will issue new,
restricted common shares of LVCA in exchange for new and/or existing Kilimanjaro
common shares. The ratio of the share exchange has been mutually accepted
("Agreed Valuation") by both companies. The exact number of new shares that LVCA
will issue to Kilimanjaro shareholders and the share exchange ratio will be
determined by the Accepted Exchange Schedule and forming Schedule A of this BLA.
The composition of the board of directors and senior officers of Kilimanjaro and
LVCA subsequent to the Closing Date will be subject to the terms of the
Definitive Agreement. Specifically the terms are as follows:
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(1)
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The
proposed closing date (“Closing Date”) shall be July 1, 2009. Both parties
agree to use their best efforts to close on
schedule.
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(2)
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The
ratio of the share exchange will be based on a mutually acceptable
valuation ("Agreed Valuation") of both companies. The Accepted Exchange
Schedule attached, as Schedule A of this BLA will determine the exact
share exchange ratio.
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(3)
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The
composition of the board of directors and senior officers of Kilimanjaro
and LVCA subsequent to the Closing Date will be subject to the terms of
the Definitive Agreement.
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(4)
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All
property agreements that LVCA has entered into with Geo Can Resources
Company Limited of Tanzania and the commitments associated within each of
these agreements will now be encompassed by the Definitive Agreement
between LVCA and Kilimanjaro. Kilimanjaro recently acquired the entire
mineral prospecting license rights that Geo Can
held.
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(5)
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Resale
Restrictions on Shares: Kilimanjaro acknowledges that the Shares issued
under the securities exchange will be subject to such resale restrictions
or escrow requirements as may be required by applicable securities
legislation or the policies of the
Exchange.
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(6)
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Kilimanjaro
will provide to LVCA all information in its possession with respect to all
the licenses that it owns, which will (subject to the provisions of the
next sentence) be held in confidence by LVCA. All information
with respect to the licenses generated pursuant to this BLA will be held
in confidence, subject to the right of any party to release any such
information (including the initial information provided by Kilimanjaro) as
required by applicable law or the rules, regulation, bylaws and listing
agreements of the Exchange.
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(7)
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Upon
execution of the Definitive Agreement, Kilimanjaro will return to LVCA a
total of 9,350,300 shares of LVCA to be cancelled and any shares that have
not been issued to Geo Can that are due for Property Purchase Agreements
will be forgiven.
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(8) Closing
will be subject to several conditions, including:
(a) Both
parties mutually agreeing to a final executable Definitive Agreement that
incorporates the general terms of this BLA by July 1, 2009 and satisfaction of
the terms and conditions to be set forth therein;
(b)
Agreement by Kilimanjaro, Kilimanjaro shareholders and LVCA to the final number
of new shares that LVCA will issue to Kilimanjaro shareholders as per the agreed
share exchange ratio schedule contained in Schedule A attached;
(c)
Completion of all necessary legal, financial and technical due diligence reviews
and receipt of all necessary consents and approvals, including board,
shareholder and regulatory approvals.
(d)
Obtaining agreement, by signature, of the Definitive Agreement by a majority
percentage (over 50%) of the Kilimanjaro shareholders.
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C. Effect
of Acceptance of this Letter Agreement
If the
terms set out herein are acceptable to you, please so indicate by signing and
returning one copy of this letter. The parties will then proceed in
good faith to complete a formal Definitive Agreement incorporating the terms
hereof and, pending the execution of this agreement, shall not actively solicit
or negotiate business arrangements, which would be inconsistent or incompatible
with the proposed Definitive Agreement. Until such time as this BLA is
terminated by virtue of the Definitive Agreement being signed on or before July
1, 2009 each of the parties hereto shall use their best efforts to complete the
Definitive Agreement on schedule. This BLA is binding on either party and each
party is obligated to proceed in good faith pursuant to the provisions hereof
and each party is obligated to bear its own costs.
There are
no third party beneficiaries to the terms of this BLA.
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Unless
otherwise stated herein, all amounts expressed herein are in the currency of
United States of America.
Each
party hereto shall be responsible for all expenses incurred by it in connection
with the preparation of the Definitive Agreement and all other documents
required in connection with obtaining all necessary regulatory approvals and
documentation for the Definitive Agreement to be executed.
Issue of
a news release by LVCA is subject to the prior review of Kilimanjaro to ensure
approval.
Yours
truly,
KILIMANJARO
MINING COMPANY INC.
By: ▇▇▇▇▇
KALENUIK
▇▇▇▇▇ Kalenuik
The
foregoing terms are acceptable as a basis for preparation of the formal and
definitive agreement.
By: ▇▇▇▇▇ ▇.
▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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SCHDULE
A
ACCEPTED
SHARE EXCHANGE SCHEDULE
The share
exchange ratio is determined by the amount of the total USD$2 million of Private
Placement money that is accepted by Kilimanjaro by June 18, 2009 for application
to the new gold project area. Accordingly, both LVCA and Kilimanjaro as the
final share exchange ratio mutually accept the following schedule.
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Total
Private Placement Accepted
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Kilimanjaro
Shares
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LVCA
Ratio Issued
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$---------
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1
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1.0
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$300,000
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1
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1.2
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$500,000
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1
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1.3
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$1,000,000
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1
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1.4
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$1,500,000
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1
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1.7
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$2,000,000
plus
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1
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2.0
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