EXHIBIT 10.2
JOINT COOPERATION "AGREEMENT"
Number : /APL.MAS.02/11.2003
KNOW ALL MEN BY THIS PRESENT :
This Joint Cooperation Agreement (Agreement) is made and entered by and between
the undersigned signatories:
APOLO GOLD INC., a Cooperation duly incorporated under the Laws of Nevada in the
United State of America, and located at :
0000-000 Xxxxxxxxx Xxxxxx
Xxxxxxxxx X.X., X0X 0X0
C a n a d a
HEREINAFTER referred to as the "FIRST PARTY" (APOLO)
AND
PT METRO ASTATAMA, a limited liability corporation, incorporated under the Laws
of Republic of Indonesia, located at:
Jln. XXX Baru Xxxx Xx. 00 Xxxxx. XXX, Xxxxxxxxx Xxxxx Xxxxxxx - 00000 -
Indonesia
HEREINAFTER referred to as the "SECOND PARTY" (METRO)
WITNESSETH :
The Parties purposefully entered into and execute this Agreement with the sole
purpose of the Parties being to work together in a Joint Operation basis to
pursue and effect the Gold Mine covering 28 hectares and 905,3 hectares,
(hereinafter referred to as the ("Property") at the Region of Babakan Loa,
District of Kedondong, South Lampung, Province of Lampung, Southern Sumatera,
Indonesia. Owned by PT Karya Bukit Utama.
NOW THEREFORE :
In consideration of mutual promises, convenants and undertakings set forth
herein and for the good and valuable consideration, the Parties declare and
agree as stated in the Articles hereto.
ARTICLE 1
---------
Presentations and Warrant
-------------------------
1.01 Whereas, APOLO represent and warrants that:
a. APOLO has full corporate power and authority to enter into this
Agreement and entering of this Agreement does not conflict with any
applicable Laws or with the by Laws of APOLO, or with any contract or
other commitment to which APOLO is a Party to.
b. The execution of this Agreement and the performance of its Terms and
Conditions have been duly authorized by all necessary action including
the Resolution of the Board of Directors of APOLO approving the
transaction.
1.02 Whereas, METRO represent and warrants that :
a. Metro has exclusively signed a MEMORANDUM of UNDERSTANDING
(Kesepakatan) Number MAS.KBU/01-04/1996 with PT.KARYA BUKIT UTAMA
(KBU) for its Property KP Exploitation number KP 96PP0082 and KP
Exploitation number KP 96PP0083 at the above said location. Metro
acknowledges that it has the sole and exclusive authority to act on
behalf of PT. Karya Bukit Utama (KBU) regarding this Agreement with
Apolo.
b. METRO has full corporate power and authority to enter into this
Agreement and entering of this Agreement does not conflict with any
applicable Laws or with the by Laws of METRO, or with any contract or
other commitment to which METRO is Party to.
c. The execution of this Agreement and the performance of its Terms and
Conditions have been duly authorized by all necessary corporate action
including the Resolution of the Board of Directors of METRO.
ARTICLE 2
---------
The Obligation of the Parties:
------------------------------
1. Under this particular Article the Parties shall define clearly and
explicitly the commitment and obligation of the Parties/signatories herein
2. METRO hereby assign to APOLO the exclusive right through this Agreement, to
explore, test, develop and mine the "Property" and to extract, remove and
sell the Minerals and mineral products therein and realize the profit
thereof. APOLO and its nominee shall be the exclusive manager of the
"Property" and its development into a productive mine.
3. APOLO shall report in writing on a quarterly basis, all their activities
and progress to METRO, in order for METRO to make regular quarterly reports
to the appropriate Government Institution. Said quarterly report shall
coincide with public reporting requirements of APOLO which reports for the
periods ending March 31, June 30, September 30 and December 31.
ARTICLE 3
---------
Assigment
---------
Both Parties agree that with the consent of either Party, which consent shall
not be unreasonable withheld, each Party shall have the right to assign all or
any parts of its interest in this Agreement and in the Property, subject to the
Terms and Conditions of this Agreement. It shall be a condition precedent to any
such assignment that the assignee of interest being transferred agrees to be
bound by the Terms and Conditions of this Agreement, insofar as they are
applicable.
ARTICLE 4
---------
Consideration and Allocation re Operation
1. Upon execution of this Agreement, APOLO shall, within 45 days, arrange for
the issuance of 3.000.000 common shares of APOLO subject to sale under rule
144, to :
PT METRO ASTATAMA
Xx XXX Xxxx Xxxx Xx. 00
Xxxxxxxx XXX, Xxxxxxxxx Xxxxx
Jakarta - 10210 (Pusat), Indonesia
as describe below:
a. 1.000.000 share issued January 15 2004
b. 1.000.000 share issued June 15 2004
c. 1.000.000 share issued January 15 2005
Should Apolo for any reason as stated in Article 5, item 6, decided to abandon
the property, any stock not already issued shall be cancelled provided Apolo's
notice to abandon the property is issued prior to the due date for issuance of
the shares.
2. The Parties has mutually agreed that the Project shall be managed by APOLO
or its nominee and that the Net Profits will be allocated eighty (80)
percent to APOLO and twenty (20) percent to METRO. Distribution of Net
Profits shall be based on a Net Profit Basis which is defined as the
deduction of all cost, expenses of operation, management fees, Government
license fees and taxes, camp expenses, travel and depreciation on Equipment
based on the projected live of the mine or the Equipment. The equipment for
mining shall be depreciated by recommended depreciation levels by the
auditors of Apolo.
3. Should the Parties disagree on the figure of the depreciation, the auditors
of APOLO shall recommend an opinion on acceptable method of depreciating
the equipment. The remaining profit after all applicable expenses shall be
paid out eighty (80) percent to APOLO and twenty (20) percent to METRO. If
payments are less than the Net Profit shown after expenses, said pay out
shall also be 80% to APOLO and 20% to METRO basis unless the Parties
mutually agree to another arrangements.
ARTICLE 5
---------
General Terms and Conditions
----------------------------
1. The Parties hereto hereby convenant and agree that they will execute such
further agreements, conveyances and assurances as may required, or which
council for the Parties may deem necessary to effect or carry out the
intent of the Agreement.
2. This Agreement shall constitute the entire Agreement between the Parties
with respect to the Property. No representation or inducement has been made
except as set forth herein. No changes, alteration, or modification of this
Agreement shall be binding upon either Party until and unless a Memorandum
in writing to such effect shall have been signed by all Parties hereto.
This Agreement suspends all previous written, oral or implied understanding
between the Parties with respect to the matter covered herein.
3. Time shall be of the essence of this Agreement
4. The Title to the Article of this Agreement shall not be deemed to form part
of this Agreement but shall be regarded as having been used for convenience
and references only.
5. Each provision of this Agreement shall be interpreted in such manner to be
effective and valid under applicable Law of Indonesia, but if any provision
shall be effective only to the extent of such prohibition or invalidity,
without invalidating the reminder of such provisions of this Agreement.
6. APOLO hereby convenant and agrees that:
a. if it should elect to discontinue its operation on the Property, it
shall return to METRO the Property interest acquired by APOLO therein
under this Agreement and shall execute any and all documents/
Agreements, that are required by METRO to effect the return of the
Property rights to METRO. All Equipment on the Property owned by APOLO
shall be sold to METRO based on current value. If the Equipment is
owned by APOLO and the Parties do not agree to a value, APOLO has the
right to remove the Equipment and sell it elsewhere.
b. It shall conduct sufficient work on the Property to maintain the
Property in good standing at all times hereinafter until the year
following any declared discontinuance, as referred to in 6.a.
7. This Agreement shall be governs by and interpreted in accordance with
International Laws and in the Independent Country.
ARTICLE 6
---------
The Payments:
-------------
1. As agreed by the Parties herein the Agreement to acquire the "Property"
amounting US$ 2,500,000.oo (US Dollar two million five hundred thousand)
with the payment schedule below, and or a six percent (6%) gross production
royalty until the amount of US$ 2,500,000.oo paid. The 6% royalty commences
when the mill is fully operational (24 hour production):
December 03 2003 USD 50,000.oo
January 15 2004 USD 25,000.oo
March 30 2004 USD 25,000.oo
June 30 2004 USD 150,000.oo
December 15 2004 USD 250,000.oo
June 30 2005 USD 250,000.oo
December 15 2005 USD 250,000.oo
June 30 2006 USD 250,000.oo
December 15 2006 USD 250,000.oo
June 30 2007 USD 500,000.oo
December 15 2007 USD 500,000.oo
-------------------
Total USD 2,500,000.oo
The parties acknowledge that the sum of $25,000 has already been paid and that a
balance of $25,000 is payable on execution of the Agreement. Payment of the 6%
gross production royalty shall be made every quarterly within 30 days of the
filing og the filing of financial statement with the SEC as part of the form
10QSB which is filed each quarter as specified in article 2 item 3.
2. Total Payment US$ 2,500,000.oo
3. In the event amounts payable are not made when they are due, APOLO shall
have a thirty (30) day period from the date the payment was due to complete
the payment.
ARTICLE 7
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Net Profit
----------
1. APOLO shall calculate on a quarterly basis, the Net Profit Derive from the
operations on the Property. The quarterly basis of the reporting shall be
coincide the quarterly reporting requirements of APOLO with The Securities
and Exchange Commission (SEC). These quarterly requirement are March 31,
June 30 , September 30and December 31. Should the Mine start on any other
basis, the first quarter will be adjusted to abide with the dates mentioned
above. All quarterly reports are due for filing 45 days after the due date
for quarterly reports and 90 days after the year end date of June 30.
2. APOLO shall no later than 45 days after completion of quarter, determine
the Net Profit available to METRO and in turn pay to METRO required amount
as defined under Article 4 of this Agreement.
3. Deliver a properly prepaid Financial statement on Operation at the Mine
site, which shall include gross receipt from mineral sales during the
reporting quarter, less Government royalties, expenses that have been
deducted, and the resulting Net Profit before taxes. This Statement will
outline the amount due to METRO.
4. Provided however that, until such time as there are Net Profit available,
APOLO should deliver to METRO within 45 days of the end of a reporting
quarter, a detailed Financial Statement of all operations. This statement
even when no mineral recovery has occurred to date. Once the required
Equipment is in place and Production has commenced, the requirements for
reporting are in effect.
5. Both Parties agree that each Party will execute and deliver such documents
as may be necessary to permit both APOLO and METRO to record its Share
rights against the Property.
ARTICLE 8
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First Right of Refusal
----------------------
Notwithstanding Article 3, in the event METRO wishes to sell all or part of its
interest in this Agreement or the Property itself, it shall first give notice to
APOLO in writing containing an offer to sell or part of its interest, and the
Terms of sale that it would be accept. The offer can be in Cash or other
consideration.
APOLO shall have 30 days from the date of receipt of notice from METRO to sell
or part, to reply in writing to METRO, its intentions re-the METRO offer. METRO
shall then be bound by this proposal they have made to APOLO. The Parties then
have a further 30 days to complete the accepted proposal that METRO has made and
APOLO has accepted. If APOLO fail to notify METRO before the expiration of the
time therein, then METRO may sell and transfer such interest offered to any
third Party or Parties, provided it is on the same terms that APOLO either
decline or fail to exercise on.
ARTICLE 9
---------
Notices
-------
Any notice, election, consent or other writing required or permitted to be given
hereunder shall be deemed to be sufficient given or postage prepaid or if given
by telegram, telex or faxes addressed as followed:
For APOLO: APOLO GOLD INC.
0000-000 Xxxxxxxxx Xxxxxx
Xxxxxxxxx X.X., X0X 0X0
C a n a d a
Telephone : 000-000-000-0000
Fax : 000-000-000-0000
For METRO: PT. METRO ASTATAMA
Jln. XXX Baru Xxxx No. 10
Kompl. XXX, Xxxxxxxxx Xxxxx
Xxxxxxx - 00000 - Xxxxxxxxx
Telephone : 000-00-000-0000
000-00-000 130 282
Fax : 000-00-000-0000
ARTICLE 10
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The Parties Rights
------------------
Each Party acknowledges that the other Party has other interest and business,
and that this Agreement is a non exclusive Agreement, and only relates to the
property described herein and/or hereafter, or otherwise agreed to by the
Parties in writing.
ARTICLE 11
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Definition
----------
In addition to the Definitions contained in this Agreement, in this Article:
"Cost means all items of outlay and expenses whatsoever, both direct and
indirect, with respect to the Property or any mine recorded by the purchaser in
accordance with generally accepted accounting principals and without limiting
generally, more particularly:
A. "Capital Costs" means:
a. All costs preparing and equipping the mine for commercial production
which are recorded prior to the completion date, including without
limiting generally, all amount invested in development headings, Heavy
Equipment, Gold processors, housing, infrastructures, road
constructions, Drainage, Airport, and other facilities whatsoever.
b. All cost of maintaining efficient production of Gold which are
recorded after completion date, including without limiting generally,
exploration, exploitation, development and acquisition of fixed
assets, and
c. For purposes only of calculation of Net Profits all items of outlay
and expenses obtained financial information and providing security as
recorded by APOLO
B. "Exploration costs" means all cost recorded during the exploration period,
including without limiting generally, such reasonable charges for
administrative services as may charged by APOLO.
C. "Exploitation costs" means all cost relating to Production of minerals.
D. "Mine costs" means all costs which do not fall into other class of costs
enumerated herein including, without limiting generally:
a. Payroll costs, including applicable fringe benefits, burden and other
direct payroll costs
b. All other costs incidental to mining operation and Government
administrations
c. All costs from any slowdown, suspensions or termination of mining
operation at the mine, whether voluntary or involuntary, and howsoever
arising
d. All prepared expenses and costs of supplies and repair parts and
consumables for the operation of the Equipment and Plant
e. All taxes, other than income taxes, royalties or other charges of
imposts provided for pursuant to any Law or legal obligation imposed
by any Government
f. All incidental costs rehabilitation of the mine, reclamation and
environmental protection, and
g. Such reasonable portion of its head office overhead costs including
management overhead as may be charged by APOLO in the normal course of
business.
ARTICLE 12
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Confidentaility
---------------
Both Parties, APOLO and METRO shall treat all data, reports, and other
information of any nature whatsoever relating to this Agreement and the Property
as confidential. The only exception to this would be matters that APOLO is
obliged to disclosure to the Public, to the securities and exchange commission
in its regular reporting requirements regarding Property matters. From the date
hereof, the Parties shall not, without the express written consent of the other
Party, disclosure to any third party any information concerning the Property or
any operation thereon. The Parties shall not buy, sell, or other wise disclosure
any information relating to the Property , unless such information is required
to be disclosed because of the applicable Law in Indonesia or in the U.S.A in
that event, the required information will be provided to the other Party first
before any disclosure is undertaken.
ARTICLE 13
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Addendum
--------
Both APOLO and METRO agree to produce an Addendum following this Agreement, to
cover any addition or modification as determined by the Parties. This Addendum
shall then become a legal and inseparable part of this Agreement and in binding
part of this Agreement.
ARTICLE 14
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The Spirit
----------
Essentially the spirit behind this Agreement is one of mutual trust and
confidence and the reliance on each of the signatories to do what is fair and it
shall be expected that each of the named signatories of private and financial
nature to the utmost of each parties ability.
ARTICLE 15
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In Witness Whereof
------------------
This Agreement shall benefit and be binding upon the Parties and their
signatories hereto and their respective heirs, successors and assigns.
This Agreement shall be executed in two (2) original copies only and having some
Power of Law. One copy is provided to "APOLO" and one copy is provide to
"METRO".
This "Agreement" shall be executed on this 17th day of November , 2003
----------------------------
"The First Party" "The Second Party"
Apolo Gold Inc. PT Metro Astatama
CORPORATE SEAL CORPORATE SEAL
/S/MARTIAL X. XXXXXXXXX /S/ X. XXXXX SABARIO
----------------------- --------------------
Martial H Xxxxxxxxx X. Xxxxx Sabario
/S/ XXXXXX XXXXXXX /S/ XXXXXXXX XXXXX
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Xxxxxx Xxxxxxx Xxxxxxxx Xxxxx
