PURCHASE AGREEMENT
THIS
AGREEMENT made May 19th,
2006
BETWEEN:
MOSQUITO
CONSOLIDATED GOLD MINES LIMITED
of 30 1
-
000
Xxxxxxxxx
Xxxxxx, Xxxxxxxxx, XX, X0X 0X0
(the
"Purchaser")
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OF
THE FIRST PART
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AND: XXXX
INSURANCE GROUP INC. of Xxxxx 000, 00 Xxxxx Xxxxxxxxxx Xxxxxx, Xxxxxx,
XX 00000
(the
"Vendor")
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OF
THE SECOND PART
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WHEREAS:
A.
The
Vendor warrants and represents that it is the owner of the mineral claims more
particularly described as Spruce Mountain Property, EIko, Nevada, Parcel
Numbers: OPM-127-064 and OPM-127-062 (collectively, the "Mineral
Claims").
B.
The
Vendor has agreed to sell and transfer 100% ofthe right, title and interest
in
and to the Mineral Claims pursuant to the terms hereinafter set forth ftee
and
clear of any and all claims of whatsoever nature and kind.
NOW
THEREFORE THIS AGREEMENT WITNESSES that in consideration of the premises and
of
the mutual covenants and agreements hereinafter contained, the parties hereto
agree as follows:
1. Purchase
and Sale
1.1
The
Vendor hereby sells, assigns, transfers and sets over unto the Purchaser for
its
own use absolutely
an undivided 100% interest in and to the Mineral Claims in its as is condition
in consideration
for US$550,OOO (the "Purchase Price") to be paid as follows:
(a)
US$75,000.OO on or before May 25, 2006;
(b) US$100,000.00
on or before July 15, 2006;
(e) US$IOO,OOO.OO
on or before September 15, 2006;
(d)
US$125,000.000 on or before November 15,2006; and
(e)
U8$150,000.00 on or before January 15,
2007,
wherein
upon the completion of the foregoing payments, the Purchaser shall be deemed
to
be the legal and beneficial owner of a 100% interest in the Mineral Claims
free
and clear of all encumbrances except for those set out in the title report
dated
May 4, 2006, referencing the original recorded Special Warranty Deed, being
document No. 550863 prepared by First American Title Company of Nevada attached
hereto as Schedule "A"
(the
"Title Report").
1.2
In
the event there is a failure to pay any of the instalments on or before the
stated due date, as provided in paragraph 1,1, there will be an interest penalty
applied at the rate of 10% per annum. The Purchase has the right to accelerate
any of the payments without penalty or any fee.
1.3
The
Purchaser shall deliver to Xxxx Xxxxxxx Xxxxxx LLP, Calgary, Alberta on or
before May 25, 2006, this Agreement originally executed and the first payment
of
US$75,000 by way of bank draft made payable to "Xxxx Xxxxxxx Xxxxxx UP in
Xxxxx", both of which shall not be released to the Vendor until Xxxx Xxxxxxx
Xxxxxx LLP has:
(i)
confirmed in writing (the "Confirmation") that it is holding in its
possession:
(a) |
duly
executed and registrable instruments for the conveyance of the legal
title
of the Mineral Claims from the Vendor to the Purchaser or the Purchaser's
designee (the "Conveyancing Instruments'');
and
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(b) |
an
irrevocable direction (the "Irrevocable Direction") to hold the
Conveyancing Instruments in trust until all payments under paragraph
1.1
have been made at which time it shall deliver the Conveyancing Instruments
to the Purchaser (the "Title Release");
and
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(ii)
provided the Purchaser with copies of the Conveyancing .lnstruments and
Irrevocable
Direction together with the Confirmation.
2. Vendor's
Representation, Warranties and Covenants
2.1
The
Vendor represents, warrants and covenants that:
(a) |
it
is the owner of an undivided100% interest in and to the Mineral Claims,
except as
described in the Title Report;
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(b) |
the
Mineral Claims are and until the Title Release will be kept free
and clear
of any encumbrances, liens or charges and it has done anything whereby
the
Mineral Claims may be encumbered;
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(c) |
the
Mineral Claims are and until the Title Release will be in good standing
under all applicable laws and regulations and all assessment work
required
has been performed and filed and all taxes have been paid, except
that the
Purchaser acknowledges receipt of a hazardous condition notice on
the
Mineral Claims from the State of Nevada and the Purchaser agrees
to accept
full responsibility and liability
to remedy said notice at the Purchaser's sole expense from the 1st
day
of
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May,
2006. Further, the
Purchaser agrees to indemnify Seller iTom any and all liability
associated with said notice;
(d) |
to
the best of the information and belief of the Vendor, the Mineral
Claims
have been properly located and staked and recorded in compliance
with the
laws of the jurisdiction in which they are situated, and that there
are no
disputes over title to the Mineral
Claims;
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(e) |
it
has the right to enter into this Agreement and to dispose of 100%
of its
right, title and
interest in and to the Mineral Claims to the
Purchaser;
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(f) |
to
the knowledge of the Vendor there are no outstanding agreements or
options
to acquire or purchase the Mineral Claims or any portion thereof
or
interest therein and no person as any royalty or interest whatsoever
in
production or profits from the Mineral Claims or any portion
thereof.
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2.2 |
The
representations and warranties in paragraph 2.1 shall apply to all
assignments, conveyances, transfers and documents delivered in connection
with this Agreement and there shall be no merger of any representations
and warranties in such assignments, conveyances, transfers and documents
notwithstanding any rule of law, equity or statute to the contrary
and all
such rules are hereby waived. The Purchaser shall have the right
to waive
any representation and warranty made by the Vendor in the Purchaser's
favour without prejudice to any of its recourses with respect to
any other
breach by the Vendor. All of the representations and warranties contained
in this Agreement shall survive the closing of this
transaction.
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3
Purthaser's
Representations. Warranties and Covenants
3.1
The
Purchaser represents, warrants and covenants that:
(a)
it
has the right to enter into this Agreement.
4. |
General
Provisions
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4.1 |
Time
shall be of the essence and the parties shall execute all further
documents or assurances
as may be required to carry out the full intent of this
agreement.
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4.2 |
This
Agreement constitutes and contains the entire agreement and understanding
between the parties and supersedes all prior agreement, memoranda,
correspondence, communications, negotiations and representation,
whether
oral or written, express or implied, statutory or otherwise, between
the
parties or any of them with respect to the subject matter
hereof.
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4.3 |
This
Agreement shall enure to the benefit of and be binding upon the parties
hereto and their
respective heirs, executors, administrators, successors and
assigns.
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4.5 |
This
Agreement may be signed in counterpart and all counterparts taken
together
shall constitute
one and the same Agreement, and any facsimile signature shall be
taken as
an original.
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IN
WITNESS WHEREOF this Agreement has been executed by the parties hereto as of
the
day and year first above written