Unassociated Document




EXHIBIT
10.24




ASSIGNMENT
OF PURCHASE OPTION AGREEMENT




THIS
ASSIGNMENT OF PURCHASE OPTION AGREEMENT is dated
for reference August 12, 2004 and made,







BETWEEN:




KEN
SWAISLAND, a person having an address at 2949 Palmerston Ave., West Vancouver,
B.C. V7V 2X2




(the
“Assignor”)




AND:




WITS
BASIN PRECIOUS MINERALS INC. a
Minnesota corporation having its office at Suite 900 - 520 Marquette Avenue.,
Minneapolis, MN 55402




(the
“Assignee”)




WITNESSES
THAT WHEREAS:




A.    The
Assignor has an option to purchase all the assets of Hunter Gold Mining Inc. and
Hunter Gold Mining Corporation including the Bates Hunter Mine and the Golden
Gilpin Mill and mill facilities, dewatering plant, mining properties, claims,
permits, and all ancillary equipment free and clear of any and all financial
liens or encumbrances with the exception of a one percent net smelter return
royalty payable to Goldrush Casino and Mining Corporation from George Otten and
Jim Blair (the “Principal Vendors”) and the other shareholders of the company
(the “Other Vendors”), as the optionors; and 




B.    Assignee
desires to purchase all of Assignor's right, title and interest in and to the
Purchase Option Agreement attached as Schedule A.




THEREFORE in
consideration of the sum of U.S.$1.00 and other good and valuable consideration
now paid by the Assignee to the Assignor (the receipt and sufficiency of which
is hereby acknowledged by the Assignor) the Assignor warrants and represents to
and covenants with the Assignee as follows:




ARTICLE
1

INTERPRETATION




1.1
  Definitions

     In this
Assignment:

 

       (a) “Assigned
Property”
means:






 


	 	
      (i)
	
      all
      of the Assignor's estate, right, title and interest as optionee in and to
      the Mines, the Companies and the Purchase Option Agreement, or portions)
      thereof demised thereunder;










 





















	 	
      ii)
	
      all
      moneys, claims, benefits, rights, demands, judgments, securities and the
      like whatsoever including any extensions or renewals thereof
      (collectively, the “Rights”) which the Assignor may now or at any time
      hereafter have or be entitled to under or by virtue of or in respect of,
      or incidental to, the Purchase Option Agreement,
  including:









	 	
      (A)
	
      any
      and all monies paid or payable to the Assignor under the Purchase Option
      Agreement; and








	 	
      (B)
	
      any
      and all benefits and advantages due or accruing due or at any time after
      (he date hereof to become due to the Assignor under the Purchase Option
      Agreement or under the Rights relating thereto;
and








	 	
      (C)
	
      the
      benefit of all covenants, guarantees, representations, warranties and
      indemnities which have been or in the fixture are granted to, received or
      negotiated by the Assignor, or any agent of the Assignor, in respect of
      the Purchase Option Agreement and/or the Rights relating
      thereto;








	 	
      (iii)
	
      all
      letters, papers and other documents in any way evidencing or relating to
      or which may, or at any time hereafter may, be received by the Assignor as
      security for or on account of the Purchase Option Agreement, the Rights
      relating thereto, or any of them;








	 	
      (iv)
	
      the
      Engineering Report on the Mines and content of the Cardinal Minerals
      website at www.cardinalminerals.net;








	 	
      (b)
	
      “Assignee”
      means the party so described above and its successors and assigns, whether
      immediate or derivative;




 


	 	
      (c)
	
      “Assignment”
      or “this
      Assignment”
      means this Assignment including all recitals and schedules hereto and
      includes all amendments thereto and modifications, restatements or
      replacements thereof from time to time;








	 	
      (d)
	
      “Assignor”
      means the party so described above and its successors and assigns, whether
      immediate or derivative;








	 	
      (e)
	
      “Companies”
      means Hunter Gold Mining, Inc. and Hunter Gold Mining
      Corporation;








	           (f)      
      	 “Mines”
      means the Bates Hunter Mine and Golden Gilpin Mine (collectively
      the “Bates-Hunter mine), and mill facilities dewatering plant, mining
      properties, claims, permits, and all ancillary equipment free and clear of
      any and all financial liens or encumbrances with the exception of a one
      percent net smelter return royalty payable to Goldrush Casino and Mining
      Corporation, as described in the Purchase Option Agreement and any
      Schedules thereto;



 





















	 	
      (g)
	
      “Purchase
      Option Agreement”
      means the “Purchase of Hunter Gold Mining Corporation (the “Target”) from
      George Otten and Tim Blair (the “Principal
      Vendors”) and the other shareholders of the company (the “Other
      Vendors”) by Ken Swaisland as evidenced by that certain agreement dated
      December 2, 2003, as amended by letter agreements dated January 13, 2004,
      March 30, 2004 and August 4, 2004;




 


	 	
      (h)
	
      “Persons”
      or “Person”
      means and includes any individual, sole proprietorship, corporation,
      partnership, bank, joint venture, trust, unincorporated association,
      association, institution, entity, party or government (whether national,
      federal, provincial, state, municipal, city, county or otherwise and
      including any instrumentality, division, agency, body or department
      thereof);








	 	
      (i)
	
      “Option
      Price”
      means the sum of $3,000,000 in United States Currency to the Principle
      Vendors to purchase all the shares (or, at Assignee’s discretion, assets)
      of Hunter Gold Mining Corporation and Hunter Gold Mining Inc. on or before
      November 30, 2005;








	 	
      (j)
	
      “Net
      Smelter Royalty”
      means the retained royalty payable to the Assignor and the Principle
      Vendors pursuant to Article 4;







All
headings and titles in this Assignment are for reference only and are not to be
used in the interpretation of the terms hereof.




1.2   Amendment




Any
amendment of this Assignment will not be binding unless in writing and signed by
the Assignee and the Assignor.




1.3      Included
Words




Wherever
the singular or the masculine are used herein, the same will be deemed to
include the plural or the feminine or the body politic or corporate where the
context or the parties so require.




1.4      Governing
Law




This
Assignment will be construed and enforced under and in accordance with the laws
of the State of Colorado.

 

1.5  Jurisdiction

 

The
Assignor hereby irrevocably agrees that any legal action or proceeding against
it with respect to this Agreement may be brought in the courts of the State of
Colorado or in such other court as the Assignee may elect and, by execution and
delivery of this Agreement the Assignor hereby irrevocably submits to each such
jurisdiction and agrees to be bound by any suits, actions or proceedings
commenced in such courts and by any order or judgment resulting form any such
suit, action or proceeding, 


 






















1.6  Severability




Any
provision of this Assignment which is prohibited by law or otherwise ineffective
will be ineffective only to the extent of such prohibition or ineffectiveness
and will be severable
without invalidating or otherwise affecting the remaining provisions of this
Assignment.




1.7      Joint
and Several Liability




If the
Assignor is comprised of more than one Person, the representations, warranties,
agreements, indemnity, and other obligations and liabilities of the Assignor
contained in this Assignment are deemed to have been made or incurred by all of
those Persons jointly and each of those Persons severally.




1.8      Capacity




If the
Assigned Property or any portion thereof is held by the Assignor as a partner of
a firm, as a trustee, as an agent, or in any other similar capacity, whether
fiduciary or otherwise, each and every:





	 	
      (a)
	
       
      warranty, representation, covenant, agreement, term, condition, proviso
      and stipulation; and







(b)    assignment
and other charge constituted hereby,




made by
or imposed upon the Assignor hereunder will be and be deemed to be jointly and
severally made by or imposed upon the Assignor and the partnership, the
beneficiary (or beneficiaries) of the trust, the principal(s) of the agent, or
other entity (or entities), as the case may be, and each assignment and other
charge contained in this Assignment will be deemed to be an assignment or charge
against the interest and title of the partnership, the beneficiary (or
beneficiaries), the principals), or such entity (or entities), as the case may
be, in and to the Assigned Property, as well as being an assignment of or charge
against the interest and title of the Assignor in and to the Assigned
Property.




1.9      Binding
Effect




This
Assignment will be binding on the Assignor and the respective heirs, executors,
personal representatives, successors and assigns of each Person comprising the
Assignor and will inure to the benefit of the Assignee and its successors and
assigns.


























ARTICLE
2

GRANT
OF ASSIGNMENT




2.1      Grant
of Assignment




The
Assignor hereby assigns, transfers and sets over the Assigned Property to
the

Assignee
to have, hold and enjoy the same, with all and every benefit and advantage that
may or can now or hereafter be derived therefrom and with all power and right to
take all lawful measures and pursue all lawful remedies which the Assignor might
have taken (and whether in the name of the Assignor or otherwise) for the full
enforcement thereof and the enjoyment of all entitlements thereunder.








ARTICLE
3

PAYMENT
OF OPTION PRICE AND OPTION CLOSING PRICE




3.1      Payment
of Option Price




Upon
execution of this Assignment of Purchase Option Agreement, the Assignee hereby
agrees to pay to Assignor the sum of FIFTY THOUSAND ($50,000.00) DOLLARS in
United States currency, payable at such time as may be mutually agreed on or
before August 30, 2004, subject to financing having been
completed.






3.2  Payment
of Shares




Promptly following the execution of this Assignment,
Assignee will cause its stock transfer agent to issue to Assignor 250,000
unregistered shares of Assignee’s common stock (the “Shares”), with piggyback
rights on any new appropriate registration statement such registration statement
to be active within six (6) months of execution of this agreement, subject to
financing having been completed.





3.3      Payment
of Closing Option Warrant




Immediately
upon the closing of the acquisition of the Assigned Property from the Principal
Vendors and Other Vendors, the Assignee shall cause its transfer agent to issue
to the Assignor a Warrant to purchase ONE MILLION (1,000,000) common shares of
Assignee (the “Closing Option Warrant”) with an exercise price equal to the
closing price during the preceding 30 days, and with a three year exercise
period. Assignee agrees to use its best efforts to promptly register the resale
of the shares of common stock underlying the Closing Option Warrant after
issuance of such warrant notwithstanding said registration shall occur within
six (6) months of the warrant issuance.




3.4
 Closing
Option Shares Not Registered




Assignor
acknowledges that the Shares and Closing Option Warrant (collectively, with the
shares underlying the Warrant hereinafter the “Securities”) have not been and
will not be registered pursuant to the securities laws of any jurisdiction and
are being transferred pursuant to exemptions from registration contained in the
United States Securities Act of 1933, as amended (the “1933 Act”), and the
Securities may only be sold in a jurisdiction in accordance with the
restrictions on resale prescribed under the laws of the jurisdiction in which
such shares are sold, all of which may vary depending on the jurisdiction.
Assignor acknowledges that it is acquiring the Securities for investment
purposes only and without any present intention for resale. Assignor
acknowledges that he is an “accredited investor” as defined in Regulation D of
the 1933 Act (herein defined).























Legend. It is
understood and agreed that the certificates evidencing the Securities will bear
the following legend:




NONE
OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN

REGISTERED
UNDER THE UNITED STATES SECURITIES ACT OF

1933
ACT (THE “1933 ACT”), OR ANY U.S. STATE SECURITIES LAWS,

AND,
UNLESS SO REGISTERED, MAY NOT BE OFFERED OR SOLD,

DIRECTLY
OR INDIRECTLY, IN THE UNITED STATES OR TO U.S.

PERSONS
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION

STATEMENT
UNDER THE 1933 ACT, OR PURSUANT TO AN

AVAILABLE
EXEMPTION FROM, OR IN A TRANSACTION NOT

SUBJECT
TO, THE REGISTRATION REQUIREMENTS OF THE 1933

ACT
AND IN EACH CASE ONLY IN ACCORDANCE WITH

APPLICABLE
STATE SECURITIES LAWS. IN ADDITION, HEDGING

TRANSACTIONS
INVOLVING THE SECURITIES MAY NOT BE

CONDUCTED
UNLESS IN COMPLIANCE WITH THE 1933 ACT.




Assignor
acknowledges that the Securities acquired pursuant to the terms of this
Agreement will have such hold periods as are required under applicable
securities laws and as a result may not be sold, transferred or otherwise
disposed, except pursuant to an effective registration statement under the 1933
Act or pursuant to an exemption from. or in a transaction not subject to, the
registration requirements of the 1933 Act and in each case only in accordance
with applicable state and provincial securities laws.




Assignor
agrees that it will sign such reasonable documents as may be required by
Assignee or its counsel in order to evidence that the transactions contemplated
in this Agreement qualify for an exemption from the registration requirements of
the 1933 Act.




ARTICLE
4

NET
SMELTER RETURNS ROYALTY PRESENTATIONS AND WARRANTIES




4
  Net
Smelter Returns Royalty




The
Assignee hereby acknowledges that the Assignor has retained, out of the interest
in the Assigned Property transferred by the Assignor to the Assignee hereunder,
and acknowledges itself bound by and hereby covenants to pay to the Assignor, a
two percent (2%) Net Smelter Returns Royalty. It is hereby acknowledged and
agreed by the parties that their mutual intent is that the Net Smelter Return
Royalty is not be contractual only, but is to be an interest in land and a
burden on, and to bind and run with, the Assigned Properties and the lands
subject thereto, and the Assignee covenants and agrees with the Assignor that
the Assignee will, at the request of the Assignor, enter into a separate
agreement with respect to the Net Smelter Return Royalty which agreement will be
recorded against such mining lease(s) as an interest in land. The Net Smelter
Royalty is in lieu and not in addition to the 2% net smelter royalty specified
in that certain assignment of Purchase Option Agreement dated January 26, 2004
between Assignor and Cardinal Minerals, Inc., which 2% royalty is null and
void.























ARTICLE
5

REPRESENTATIONS
AND WARRANTIES




5
  Representations
and Warranties




The
Assignor represents and warrants to the Assignee with respect to the Assigned
Property as follows:




i.
Authority to Assign: the Assignor has a good right, fall power and absolute
authority to assign, transfer, set over the Assigned Property to the Assignee in
the manner contemplated by this Assignment;




ii. No
Other Assignments: none of the Assigned Property has been previously assigned to
or pledged or encumbered in favor of any other Person, except Cardinal Minerals,
Inc., and Cardinal Minerals, Inc. has properly reassigned all of its interest to
Assignor, receiving all necessary consents;




iii.
Purchase Option Agreement Valid and Subsisting: the Purchase Option Agreement is
a valid and subsisting Purchase Option Agreement and is in full force and
effect;




iv.
Purchase Option Agreements Complete: the Purchase Option Agreement represents
the entire agreement between the parties thereto with respect to the subject
matter thereof;




v. Mine
and Mill Permit status: The Assignor assures to the best of his knowledge and
understanding that Permit M-1990-41, which covers the Bates-Hunter Mine and the
Golden Gilpin Mill and the Water Discharge Permit # 0043168 are in good standing
and has the rights to transfer same to the Assignee.




vi. No
Breaches: the Assignor has not committed any act or omitted to perform any
obligation, nor has the Assignor permitted any act or omission to occur, which
would be a breach or a default of the Assignor's obligations pursuant to the
Purchase Option Agreement or which would vitiate the continued obligations or
liabilities of any other party to the Purchase Option Agreement;




vii. No
Defaults: the Assignor is not aware of any default under the Purchase Option
Agreement by the Assignor or by any other party thereto;




viii. No
Disputes: there are no disputes of which the Assignor is aware between the
Assignor and any other party to the Purchase Option Agreement concerning the
Purchase Option Agreement;




ix.
Obligations Performed: the Assignor has fulfilled and performed all of its
obligations and liabilities under the Purchase Option Agreement to be performed
by it through the date of this Assignment and has maintained all of its Rights
thereunder; and




x.
No
Consents Required; no
consents are required to the assignment of the Assigned Property as contemplated
hereby, in order to effect this assignment.























6
  MISCELLANEOUS




a. Notice




Any
notice, demand or other document to be given, or any delivery to be made
hereunder shall be effective if in writing and delivered in person and left
with, or if telecopied and confirmed by prepaid registered letter addressed to
the attention of:




i.    in the
case of the Assignee, addressed as follows:




Wits
Basin Precious Minerals Inc.

Suite 900
- 520 Marquette Avenue

Minneapolis,
MN 55402

Attention:
President

Fax
Number: 612-371-2077




ii.    in the
case of the Assignor, addressed as follows:




Kenneth
F. Swaisland

2949
Palmerston Ave

West
Vancouver, B.C. V7V 2X2

Fax
Number: 604-925-3592 




Any
notice, demand or other document or delivery so given or made shall be deemed to
have been given or made and received at the time of delivery in person or on the
business day next following the date of telecopying of the same. Any party
hereto may from time to time by notice in writing change his or its address (or
in the case of a corporate party, the designated recipient) for the purposes of
this section.




b.    Execution
in Counterparts




If the
Assignor is comprised of more than one party, this Assignment may be executed by
such parties in several counterparts, each of which will be deemed to be an
original and all of which will together constitute one and the same
instrument.




c.    Time
of the Essence




Time is
of the essence of this Assignment.




d.   Due
Diligence




In the
event that Assignee elects not to complete the due diligence programs as
recommended by Glen O’Gorman within the time frames contained within The Hunter
Gold Mining Corporation Letter of Extension and modification dated August 31,
2004 and attached hereto as Schedule B or should the Assignee elect not to close
on the acquisition of the Mines, then (a) the Assignee will immediately reassign
to the Assignor all of the rights, title and interest to the Option forming the
subject matter of this agreement and (b) the Assignor will immediately return to
Assignee the Shares, duly endorsed and medallion guaranteed, and (c) Assignor
will have no further obligations under the Option Purchase Agreement or this
Assignment whatsoever.


























IN
WITNESS WHEREOF the
Assignor has duly executed this Assignment on this 12 day of August,
2004.



	 KENNETH F.
      SWAISLAND	 	 
	 	
	 
 per: /s/
      Kenneth F. Swaisland	 
 	 
 
	Authorized Signatory- Kenneth F.
      Swaisland	  	
	 	
	 	







	 WITS BASIN PRECIOUS MINERALS
    INC.	 	 
	 	
	 
 per: /s/
      H. Vance White	 
 	 
 
	Authorized Signatory - H. Vance White, CEO