EXHIBIT 10.4


 


 


AGREEMENT


 


THIS AGREEMENT
(“Agreement”) is made effective as of the     5     day of January,
2016, by and between Logistica U.S. Terminals, LLC (“LOGISTICA”), of Brownsville, Texas, and
El Capitan Precious Metals, Inc. (“ECPN”), of Scottsdale, Arizona.


 


In consideration of the mutual promises and
covenants herein contained, the Parties do hereby agree as follows:


 


     1.         The Parties acknowledge that they have previously entered
into and executed a Master Service Agreement, including an Iron Ore Processing Agreement attached as Appendix A thereto, both of
which are dated February 28, 2014, and a separate Agreement, dated December 24, 2014.


 


2.         The written contracts described in the previous paragraph
shall become null and void and unenforceable upon execution of the Agreement which supersedes those agreements. As a result, neither
Party shall be able to make any claim whatsoever against the other Party based on these prior agreements.


 


3.         The Parties hereby express their mutual desire and willingness
to develop mining activities in regard to the ore body known as the El Capitan mine site, near Capitan, New Mexico.


 


4.         As a part of the mining project referenced in the previous
paragraph, it shall be the responsibility of ECPN to do as follows:


 


a.       ECPN shall make concentrated ore available, always within
the quality      specifications defined and agreed, from the subject mine site for the purposes of carrying      out its responsibilities
under this Agreement.


 


b.       ECPN shall obtain and maintain the governmental compliance
requirements with      all necessary federal, state and local agencies.


 


c.       ECPN shall process and load the subject concentrated ore
on the trucks provided      by Logistica at the El Capitan mine site.


 


d.       ECPN shall otherwise use its best efforts to make the
mining project      contemplated by this Agreement successful.


 


5.         As a part of the mining project referenced in Paragraph
3 above, it shall be the responsibility of Logistica to do as follows:


 


a.       In cooperation with ECPN, Logistica, in its sole discretion,
shall provide all      necessary means of transporting the concentrated ore provided by ECPN to locations      mutually agreed upon
by ECPN and Logistica for further processing by Logistica or for           sale to a third party as the case may be.


 



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b.       Logistica shall further process the concentrated ore as
necessary, if it is required      and affordable, to a more refined state to make such ore product saleable to buyers, or in      the
alternate, Logistica may, in its sole discretion, otherwise undertake a process for the      extraction of precious metals.


 


c.       Logistica shall attempt to locate buyers for the concentrated
ore or precious      metals and shall actually undertake and sell the ore product or precious metals, as the      case may be.


 


d.       Logistica shall deposit all of the proceeds from the sale
of such ore products or      precious metals in an account in a federally-insured financial institution in the United      States
as mutually agreed upon by the Parties. Such account shall be in the name of both           Parties, requiring the authorized signatures
of both Parties for withdrawal.


 


e.       Logistica shall otherwise use its best efforts to make
the mining project      contemplated by this Agreement successful.


 


6.         The Parties are jointly undertaking this effort to develop
the El Capitan mine site and to process and sell the concentrated ore and precious metals located thereon pursuant to the provisions
of this Agreement. In doing so, each of the Parties shall maintain a record of its costs and expenses in carrying out each of its
specific duties and responsibilities under this Agreement. Such costs and expenses shall be only those incurred as operating expenses
for the activities described in this Agreement and not for general overhead or other non-mining related matters. Upon the receipt
of any revenues from such activities each of the Parties shall submit its costs and expenses to an accountant mutually agreed upon
by the Parties who shall compile a combined accounting of such costs and expenses pursuant to generally accepted accounting principles.
Each of the Parties shall then first be reimbursed for such incurred costs and expenses attributed to the ore product or precious
metals sold in a ratio representative of such respective amounts at that time. Once all such costs and expenses are reimbursed
to both Parties in full, the remaining net profit shall be divided equally in a 50/50 manner.


 


7.         The ore to be provided to the Logistica by ECPN from the
El Capitan mine site shall be “concentrated ore”, meaning that such ore shall be prepared by ECPN to certain specifications
as otherwise agreed between the Parties, but such concentrated ore shall contain a minimum of one (1) ounce of gold equivalent
per ton of precious metals.


 


8.         Once a buyer or buyers have been secured for the sale
of concentrated ore or precious metals, as contemplated by this Agreement, Logistica shall arrange for a line of credit or a letter
of credit, based on the underlying purchase contracts, to provide for the capitalization of the mining, processing, and sale activities
of the Parties after that point in time. This provision contemplates that, as soon as the concentrated ore or precious metals are
delivered to a buyer both ECPN and Logistica will be able to draw on the subject line of credit or letter of credit for its share
of the revenues attributed to the delivered product. In addition, separately, Logistica will use its best efforts to attempt to
assist ECPN in obtaining additional capitalization for ECPN upon execution of this Agreement. Logistica, however, will not be penalized
in any way if such capitalization cannot be achieved.






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9.         ECPN shall transfer to LOGISTICA ten million (10,000,000)
shares of Rule 144 common stock of ECPN which was committed under a previous agreement, upon execution of this Agreement.


 


10.       In addition, ECPN shall provide LOGISTICA with a Promissory
Note in the amount of Four Hundred Thousand Dollars ($400,000.00), with interest thereon at the rate of four and one-half percent
(4.5%) from February 28, 2014. Payment on such Promissory Note shall be made to Logistica out of the ECPN proceeds from the sale
of the concentrated ore from the El Capitan mine. The amount due to LOGISTICA by ECPN shall be reasonably paid from cash flow generated
by ECPN from the activities contemplated by this Agreement as agreed by the Parties. This Promissory Note shall replace the promissory
note described in the prior agreements between the Parties and which has been previously accounted for as the financing loaned
to purchase the AuraSource device.


 


11.       If Logistica is able to secure a purchaser for the El
Capitan mine site, Logistica shall receive a five percent (5%) commission calculated on the gross sale price of the mine site.
If ECPN sells or otherwise transfers an interest in the El Capitan mine site to a third party without the assistance of Logistica,
Logistica will receive the sum of Five Million Dollars ($5,000,000.00) upon closing of such transaction as was previously agreed,
as an inducement to enter into the investments necessary to put the processes and infrastructure in place


 


12.       It is the intent of the Parties pursuant to this Agreement
to have ECPN provide to Logistica a minimum amount of one thousand (1,000) tons of concentrated ore per month at the beginning
of this project. The Parties shall then cooperate to increase that monthly amount to at least five thousand (5,000) tons of concentrated
ore as soon as is reasonably possible, with the desire of both Parties to continue to increase such amounts as mush as is reasonably
possible, as soon as is reasonably possible. The Parties have set out their mutual goals in such regard as set out on the attached
Exhibit A.


 


13.       It is the further intent of both Parties to attempt to
develop and increase the mining activities at the El Capitan mine site for the mutual best interests of the Parties. This shall
potentially include the greater development of the mining capabilities at the El Capitan mine site, including more significant
facilities and technologies in processing the ore body there at. These further and greater activities will be undertaken pursuant
to separate written agreement between the Parties hereafter. Logistica however, will not separately lease any mineral acres within
twenty-five (25) miles of the El Capitan mine site.


 






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14.       The term of the relationship between the Parties for
the mining project contemplated by this Agreement shall be for a minimum of five (5) years. However, if ECPN sells or otherwise
transfers an interest in the El Capitan mine site, this Agreement shall terminate, except that ECPN shall compensate Logistica
pursuant to Paragraph 11 above.


 


15.       The Parties shall keep the proprietary information which
each Party received from the other Party fully and strictly confidential. However, each of the Parties shall have the right to
disclose and disseminate the terms and conditions of this Agreement, including in the form of press release and governmental disclosure
documents. This provision shall not prohibit either Party from disclosure as required by a regulatory agency or court of law.


 


16.       Neither Party shall be liable to the other, or be deemed
to be in breach of this Agreement, by reason of any delay in performing, or failure to perform, any of its obligations under this
agreement if the delay or failure was beyond that party's reasonable control (including without limitation weather, fire, flood,
explosion, epidemic, riot, civil commotion, any strike, lockout or other industrial action, act of God, war, warlike hostilities
or threat of war, terrorist activities, accidental or malicious damage and any prohibition or restriction by any government or
other legal authority which affects this Agreement and which is not in force on the date of this Agreement.


 


17.       The Parties shall fully cooperate with one another in
carrying out the intent of this Agreement. This shall specifically include, but not be limited to, inspections, disclosure of any
and all requested information and material, and any other due diligence activities of a Party. The Parties acknowledge that the
subject mining project contemplated by this Agreement is in its initial phase, which project will change and evolve on an ongoing
basis. The Parties will work together and cooperate in adapting to such changes, and the resulting needs of this project, and will
adapt and conform their duties and activities respectively to achieve the intended results to make the project successful. If any
issues arise in such regard, such issues shall be subject to the arbitration provision hereinafter contained.


 


18.       Each Party shall bear its own costs and expenses in this
matter, except as otherwise set out in this Agreement.


 


19.       The relationship between the Parties is that of independent
contractors. The Parties are not agents, partners, joint ventures, or employees of the other. As such, each Party shall be responsible
for the payment of its own taxes and for its other governmental and business obligations. Neither Party may in any way bind or
obligate the other Party nor suggest or represent that it has the right to do so. No fiduciary relationship exists between the
Parties hereto, except to reasonably and ethically honor its duties and responsibilities under this Agreement.


 






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20.       Each of the Parties to this Agreement shall hold the
other Party harmless and indemnify the other Party for liability or damages caused by the activities of such Party, within the
scope of their relationship as independent contractors.


 


21.       This Agreement constitutes the entire agreement between
the Parties hereto with respect to the subject matter addressed herein. All prior and contemporaneous agreements, understandings,
conditions, warranties, and representations are hereby superseded by this Agreement.


 


22.       Any modification or change in this Agreement must be
in writing, executed by an officer of ECPN and Logistica. No representative has the right or authority to make any oral or written
modifications of this Agreement.


 


23.       Should one of the sections or provisions of this Agreement,
or any word, phrase, sentence, clause, or paragraph thereof be declared invalid, illegal, or unenforceable in any respect by any
federal, state, county, or municipal government, such validity, legality, and enforceability of the remaining sections and provisions
hereof and any other applications thereof shall not in any way be affected or impaired thereby and will remain in full force and
effect as if such invalid or illegal sections or provisions were omitted.


 


24.       No waiver of any breach of any condition, covenant, or
agreement herein shall constitute a continuing waiver or a waiver of any subsequent breach of the same or any other condition,
covenant, or agreement.


 


25.       The Parties agree to negotiate in good faith to resolve
any disputes, disagreements, questions, claims, or similar matters in regard to this Agreement or any matter in regard to the relationship
between themselves. If such matters cannot be resolved by negotiation between the Parties, such matters shall be resolved by using
a single arbitrator and procedures established by such arbitrator. Judgment upon any award may be entered in any court of competent
jurisdiction. The prevailing party shall be entitled to recover all expenses of arbitration, including reasonable attorney's fees.
Venue of such arbitration shall be in Maricopa County, Arizona. Either Party may make a demand for arbitration by filing the demand
in writing with the other Party. This provision for arbitration shall be an absolute bar to any other legal proceedings between
the Parties hereto. This Agreement shall be construed in accordance with the laws of the State of Arizona.


 


26.       This Agreement may be executed in one or more counterparts,
each of which will be deemed to be an original copy of the Agreement and all of which, when taken together, will be deemed to constitute
on and the same Agreement.


 


IN WITNESS WHEREOF, the parties have executed
this Agreement as of the day and year first above written.


 






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	LOGISTICA U.S. TERMINALS, LLC	 	EL CAPITAN PRECIOUS METALS, INC.
	 	 	 	 	 
	 	 	 	 	 
	By:	/s/ Humberto Siller	 	By:	/s/ Charles C. Mottley
	 	Humberto Siller	 	 	 Charles C. Mottley
	 	Manager	 	 	CEO and President



 






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