SALE AND PURCHASE OF MINING CONCESSIONS AGREEMENT
Exhibit 10.6
SALE AND PURCHASE OF MINING CONCESSIONS AGREEMENT
THIS AGREEMENT is made and entered at the City of Chihuahua, State of Chihuahua on this the 18th day of August of the year 2005,
AMONG:
MINERA RIO TINTO, S. A. DE C. V. a company duly incorporated and validly existing pursuant to the laws of the United Mexican States, herein represented by ▇▇▇▇▇ ▇▇▇▇ TOUCHE in his capacity as Sole Administrator holding general powers of attorney for legal representation and collections, acts of administration and domain, and having an office at Av. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Number 2117- Altos, La Cima, C. P. 31310, Chihuahua, Chihuahua (R .F. C. MRT940802NN2) (hereinafter referred to as the "Vendor ")
OF THE FIRST PART
AND
SUNBURTS MINING DE MÉXICO, S. A. DE C. V. a company duly incorporated and validly existing pursuant to the laws of the United Mexican States, herein represented by ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ in his capacity as Sole Administrator holding general powers of attorney for legal representation and collections, acts of administration and domain, and having an office at ▇▇. ▇▇▇ ▇▇▇ ▇▇▇▇ – ▇ ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, Sinaloa, C. P. 82149, (R. F. C. SMM050708TJ7) (hereinafter referred to as "Purchaser")
OF THE SECOND PART.
WHEREAS:
A.
The Vendor is the sole legal and beneficial recorded owner of the Mining Concessions.
B.
The Vendor wishes to sell to the Purchaser and the Purchase wishes to purchase from the Vendor, on payment of the Purchase Price, all of the Vendor’s rights, title and claims in and to the Mining Concessions
NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the mutual warranties and representations herein contained, the parties agree as follows:
1.
WARRANTIES AND REPRESENTATIONS OF THE VENDOR
1.1.
To induce the Purchaser to purchase the Mining Concessions, the Vendor warrants and represents to the Purchaser that:
A.
The Vendor is the sole legal and beneficial recorded owner of the following mining concessions located of the Municipality of Guazaparez, State Chihuahua, Mexico:
(1)
mining lot “Encino Gordo”, mining exploration title No. 225297, valid from 12/08/2005 to 11/08/2011 land area: 450 has.;
(2)
mining lot “Encino Gordo” mining exploration title No. 292013;
The mining concessions referred in this Subsection 1.1. Paragraph A shall hereinafter collectively referred to as the “Mining Concessions”.
B.
The Mining Concessions are, as of the date hereof: (1) validly existing (2) in full compliance with all obligations imposed by the Mining Act of Mexico and its Regulations (3) free and clear of all liens, charges or limitations of ownership whatsoever and (4) free and clear of the effects of any agreement or act that may affect the rights attached thereto or their ownership.
C.
The execution and performance of this Agreement will not conflict with or result in any breach of any covenants, agreements or other instrument whatsoever to which the Vendor is a party to or is related to the Mining Concessions.
D.
The authority of its representative acting herein is sufficient in accordance with the law for the execution hereof and such authority has not, as of the date hereof, been revoked, amended or limited in any manner whatsoever.
2.
WARRANTIES AND REPRESENTATIONS OF THE PURCHASER
2.1.
The Purchaser warrants and represents to the Vendor that:
A.
The Purchaser is a limited liability corporation duly incorporated and validly subsisting pursuant to the laws of the United Mexican States and, therefore, it possesses the legal capacity required under Mexican law to hold as proprietor the ownership rights in and to mining concessions located within the territory of the United Mexican States, pursuant to article 11 of the Mining Act.
B.
The authority of its representative acting herein is sufficient in accordance with the law for the execution hereof and such authority has not, as of the date hereof, been revoked, amended or limited in any manner whatsoever.
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3.
SALE AND PURCHASE. The Vendor hereby sells to the Purchaser, and the Purchaser hereby purchases as proprietor from the Vendor, an undivided one hundred percent (100%) title in and to the Mining Concessions, free and clear of all liens, charges, encumbrances, adverse claims, rights or interest of any person and with no reservation of any right or action of any nature whatsoever.
4.
PURCHASE PRICE. The Purchaser hereby pays to the Vendor, and the Vendor receives in full satisfaction, as the total price for the purchase of an undivided 100% title to the Mining Concessions, the amount of $ 1,000 (One Thousand Pesos currency of Mexico) plus applicable Value Added Tax (the “Purchase Price”). This Agreement shall signify full evidence of receipt of the Purchase Price by the Vendor.
5.
OBLIGATIONS OF VENDOR. If necessary or required by law, the Vendor shall promptly execute or cause to be executed all documents, deeds, conveyances and other instalments of further assurance which may be reasonably necessary or advisable to carry out fully the intent of this Agreement or to record the Purchaser as the sole legal and beneficial owner of the Mining Concessions at the Mines Registry office of the Federal Bureau of Mines.
6.
ASSUMPTION OF OBLIGATIONS. Following the date of signing of this Agreement, the Purchaser is the holder of all rights and the obligor to all obligations imposed to such Purchaser by the Mining Act of Mexico and its Regulations, as the sole legal and beneficial recorded owner of the Mining Concessions.
7.
AREA OF INFLUENCE. The parties agree that any mining concession or rights attached to any mining concession, or any rights derived from any application for a mining concession, owned by the Vendor or by any representative of the Vendor as of the date hereof or subsequent to such date, having an area located within ten (10) kilometers from the outer perimeter of the Mining Concessions, shall automatically and without the requirement for additional consent or action, form part of the Mining Concessions and therefore shall be subject to this Agreement.
8.
FIRS RIGHT OF REFUSAL.- The Vendor hereby represents to be the owner of 100% title to the mining concessions title no. 220149 (mining lot “El Camuchin”) and 220148 (mining lot “La Paloma”) geographically adjacent to the Mining Concessions subject matter hereof. The Vendor hereby grants to the Purchaser, and the Purchaser acquires from the Vendor, the first right of refusal to acquire, in first priority, 100% or any lesser portion of title to the referenced mining concessions. In the event of an offer to purchase any portion of the mining concessions described herein made to the Vendor by a third party, the Vendor shall forthwith notify the Purchaser thereon indicating the price offered thereby and it shall grant to the Purchaser a term of thirty days to exercise its first right of
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refusal granted herein. If the Purchaser desire to exercise its first right of refusal, it shall forthwith notify the Vendor accordingly and both parties shall immediately execute proper transfer agreement in accordance with the terms contained in the notice; if the Purchaser dos not desire to exercise its first right of refusal, it will likewise notify the Vendor accordingly and thereafter the Vendor shall have the right to freely sell its interest in the aforesaid mining concessions, but solely under the terms set out in the notice.
9.
NOTICES. Any notice or notification given or required to be given between the parties as a result of the application of this Agreement shall be given in writing and shall be addressed to the latest domiciles set out by the parties under this Agreement, which domiciles are, until further notice is given, as follows:
If to the Purchaser:
If to the Vendor:
Minera Rio Tinto, SA de CV
Sunburst Mining de México, SA de CV
Attention: ▇▇▇▇▇ ▇▇▇▇ Touché
Av. Del Mar 1022 – 5, Zona Costera
Av. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ No.2117
Mazatlán, Sinaloa, México, C.P.82149
La Cima, Chihuahua, Chihuahua, México
Main. (6699) 90 05 48
Tel/Fax. ▇▇▇-▇▇▇-▇▇▇▇
Fax. (6699) 86 98 59
The parties may, at any time, change their above-referenced domiciles by ten days written notice to the other party.
All Notices shall be given (i) by personal delivery, or (ii) by electronic communication, with a confirmation sent by registered or certified mail return receipt requested, or (iii) by registered or certified mail return receipt requested or by commercial courier. All Notices shall be effective and shall be deemed delivered (i) if by personal delivery, on the date of delivery if delivered during normal business hours, and, if not delivered during normal business hours, on the next business day following delivery, (ii) if by electronic communication, on the next business day following actual receipt of the mailed confirmation, and (iii) if solely by mail or by commercial carrier, on the next business day after actual receipt. A Party may change its address by Notice to the other Party.
10.
GOVERNING LAW. This Agreement shall be construed and regulated by the provisions of the Mining Act of Mexico and the Regulations, the Code of Commerce, the Federal Civil Code and the Civil Code of the State of Chihuahua, Mexico. The parties hereto attorn to the jurisdiction of the state and federal tribunals of the City of Chihuahua, State of Chihuahua, which shall have the authority to resolve any dispute, suit or claim arising under, or the interpretation or construction of, this Agreement. The parties hereby renounce to the jurisdiction of any other tribunal or court to whose jurisdiction they might have a right to, by virtue of their current or future domiciles or by provision of any law currently or in the future in force and effect.
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11.
WHOLE AGREEMENT. This Agreement shall constitute the entire understanding of the parties in respect to the subject matter hereof and it shall supersede and replace any other agreement or arrangement, whether oral or written, heretofore existing between the parties in respect of the subject matter of this Agreement.
12.
LANGUAGES. This Agreement is approved in both the English and Spanish languages. The parties agree that in the event of discrepancy between the two versions, the Spanish version shall prevail. The parties acknowledge to having obtained sufficient independent legal advice and to having read and understood (through their respective appointed interpreters and legal counsel) the legal effects and validity of this Agreement in both the Spanish and English versions. The English version is attached as schedule A hereto and made part hereof for all corresponding legal effects.
In witness whereof, the parties hereto after having read and understood the legal effects and validity of the premises set forth above, have caused this Agreement to be executed on the date and place first above written.
THE “VENDOR”
MINERA RIO TINTO, S.A. DE C. V.
__________________________
▇▇▇▇▇ ▇▇▇▇ TOUCHE
ITS SOLE ADMINISTRATOR
THE “PURCHASER”
SUNBURST MINING DE MÉXICO, S. A. DE C. V.
____________________________
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
ITS SOLE ADMINISTRATOR
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