Document:

exhibit1011.htm

EXHIBIT 10.11

 

Transfer Agreement

Party A: Shenzhen Jiancheng Investment Ltd.

Party B: Tibet Changdu Huiheng Development Ltd.

Both parties reached the following agreement regarding transferring all the assets and equity held by Party A in the “Project of accelerator center of Liaocheng Hospital of Traditional Chinese Medicine” (hereafter “Liaocheng Project”) to Party B.

	
i.

	
Asset and equity to be transferred

The asset and equity to be transferred is: all equity of Party A in Liaocheng Project, including:

	
  

	
(1)

	
Asset to be transferred: all assets invested by Party A under the <<Contract for Establishing Cooperatively an Accelerator Treatment Research Center>> between Party A and Liaocheng Hospital of Traditional Chinese Medicine.

	
  

	
(2)

	
Equity to be transferred: all equity of Party A under the <<Contract for Establishing Cooperatively an Accelerator Treatment Research Center>> between Party A and Liaocheng Hospital of Traditional Chinese Medicine.

Both Parties agree that Party B obtains the right to income in Liaocheng Project after the transfer.

	
ii.

	
Transfer Price

Both Parties agree that the total transfer price of the asset and equity in Liaocheng Project is RMB 9 million.

	
iii.

	
Transition

	
  

	
1.

	
Within 5 days after the Agreement is executed, Party B pays the deposit to Party A , and Party A provides to Party B a <<Project Material List>> of Liaocheng Project (including project overview, background, cooperation agreement, asset sheet of the agreement, etc) based on the requirement of Party B, which will be taken as the basis of the transfer and through which Party B establishes its purchase intention. The materials provided by Party A must be true, complete and accurate.

	
  

	
2.

	
Party B verifies the project. Party B after determining its purchase intention can verify the items to be transferred according to the <<Project Materials List>> within 20 days of receipt of the <<Project Materials List>>. Both parties shall sign the verification sheet after the verification is finished. If the verification succeeds, Party B takes over the assets and equity under the <<Cooperation Contract>> of Liaocheng Project of Party A, and pays the transfer price subject to the Agreement, and Party A arranges contact with the hospital. If the verification shows that the items are significantly different from those listed in the <<Project Materials List>>, both parties negotiate to settle. If the negotiation fails to meet the requirement specified in the <<Project Materials List>>, Party B can withdraw from the transfer and Party A shall return all the deposit and the interest of the deposit based on the interest rate of the bank at that time to Party B. If Party B does not perform the Agreement and withdraw from the transfer when the verification succeeds, Party B shall bear the liability for breaching the agreement

	
  

	
3.

	
Closing of the cooperation equity. Both parties execute a supplemental agreement in writing to specify the closing date of the cooperation equity and the ownership of the asset and equity before and after the closing date. Party A shall also transfer to Party B legal documents, financial documents and related materials in connection with Liaocheng Project. These documents and materials shall basically be in their original forms. If original documents or materials are not available, copies shall be provided affixed with Party A’s seal. Party B shall have the right to determine whether it will continue to hire the personnel involved in Liaocheng Project. For those that Party B determines to continue to hire, Party A shall arrange the execution of Labor Contract for them in accordance with Party B’s requirement, and for those that Party B will not continue to hire, Party A shall be responsible for the layoff.

 

 

 

  

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iv.

	
Payment method of the transfer amount

	
  

	
1.

	
Party B shall pay Party A RMB 1 million as deposit within 5 business days after the execution of the Agreement. If the Contract and the Agreement have been performed, the deposit will be taken as part of the transfer amount;

	
  

	
2.

	
Party B shall pay Party A RMB 3 million as transfer amount within 5 business days after both parties have verified that the deposit has been paid to Party A, the Agreement has taken effect, and Party B has finished the verification within 20 days after receiving the <<Project Materials List>> from Party A;

	
  

	
3.

	
Party B shall pay Party A RMB 4 million within 5 business days after the asset and the equity have been handed over to Party B, and Party A provides a receipt indicating the total amount of the transfer;

	
  

	
4.

	
Party B shall pay Party A RMB 1 million as transfer amount within 90 days after the asset and the equity have been handed over to Party B.

	
v.

	
Declaration and guarantee of both parties

	
  

	
1.

	
Declaration and guarantee of Party A

	
  

	
(1)

	
Party A guarantees it has complete, effective right to own and dispose of the asset to be transferred, and it will not cause any damage to third party’s interest or raise any dispute;

	
  

	
(2)

	
Up to the execution date of the Agreement, Party A has not disposed of the asset to be transferred by transferring, by using as a pledge, by paying a debt, by using for security, or in any other manner. There is not any debt or debt related dispute involved with the asset to be transferred. Party A has not given its equity in Liaocheng Project as a pledge to a third party;

	
  

	
(3)

	
The asset to be transferred is in good condition and in normal operation;

	
  

	
(4)

	
Party A guarantees it has disclosed to Party B authentically, accurately and completely Liaocheng Project, related facts, matters or status in connection with fulfillment of the original Cooperation Contract;

	
  

	
(5)

	
Party A shall not change in any manner the terms of the original Cooperation Contract to cause damage to Party B’s interest;

	
  

	
(6)

	
Party A does not have any amount due to personnel in the Accelerator Treatment Research Center regarding salary, bonus and marketing fees. If there is such an amount due, it will be deducted from the transfer amount;

	
  

	
(7)

	
Party A shall not be engaged in any project in Liaocheng Hospital of Traditional Chinese Medicine with a third party that is competitive with Liaocheng Project;

	
  

	
(8)

	
Party A shall not actively transfer key personnel in Liaocheng Project;

	
  

	
(9)

	
Party A will perform the Agreement following the principle of honesty and good faith.

	
  

	
2.

	
Declaration and guarantee of Party B

	
  

	
(1)

	
The money paid by Party B as the transfer amount comes legally;

	
  

	
(2)

	
Party B has sufficient funds to make the payment under the Agreement;

	
  

	
(3)

	
Party B will perform the Agreement following the principle of honesty and good faith.

 

 

 

  

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vi.

	
Liabilities of Breach of Duties

If either party has the activity that is in violation of Clauses 1 and 2 of Article 5 of the Agreement, the other party has the right to cancel the Agreement, and the Party in violation shall be liable for all financial damages of the other party.

	
vii.

	
Cost

Both parties shall bear their respective cost for executing and performing the Agreement (including tax payable), except provided otherwise.

	
viii.

	
Force Majeure

	
  

	
1.

	
Should either party be prevented from performing all or part of its obligations or delayed for performing its obligations under the Agreement owing to an event of Force Majeure, it shall be exempt from the default liabilities arising therefrom, but it shall take all necessary relief measures if allowed to reduce losses caused by the event of Force Majeure.

	
  

	
2.

	
The Party claiming for Force Majeure circumstances shall notify the other party in writing of such event as soon as possible, and provide a report in writing including obligations under the Agreement that can not be performed or fully performed and the reason to delay the performance within 15 days after the event of Force Majeure.

	
ix.

	
Information disclosure and confidentiality

	
  

	
1.

	
Party B shall keep secret of the information about the trade secret, technology secret and business operation, etc. of Party A and of the project that is know to Party B for performing the Agreement, and shall not disclose to third parties or publish.

	
  

	
2.

	
Party B shall take necessary measures to maintain the trade secret and operation secret of Party A and its partner (the Hospital) known to Party B for performing the Agreement and keep the confidentiality. Party B shall not disclose, tell, give or transfer to a third party in any manner the project materials provided by Party A, except agreed by Party A in writing beforehand, and except that Party B is using the materials normally for performing the Agreement.

	
x.

	
Governing law and dispute settlement

The Agreement shall be governed by Chinese law. Both parties shall negotiate to settle disputes under the Agreement; if negotiation fails, either party can initiate arbitration in an Arbitration organization in the location where the Agreement is executed.

Any amendment to the Agreement shall be provided as a supplemental agreement in writing executed by both parties.

 

 

  

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xi.

	
Execution and effectiveness

	
  

	
1.

	
The Agreement will become effective after it is signed by legal representatives or authorized representatives of both parties affixed with seals of both parties.

	
  

	
2.

	
The Agreement includes four copies with each party holding two copies.

	
  

	
3.

	
The Agreement prevails in case of inconsistency between the Agreement and <<Contract>>.

Party A: Shenzhen Jiancheng Investment Ltd.

Date: 03/13/2011

Party B: Tibet Changdu Huiheng Development Ltd.

Date: 03/14/2011

  

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Radiation Oncology Center Co-establishment Contract

 

Liaocheng Traditional Chinese Medical Hospital, Shandong Province

Jiancheng Investment Co., Ltd., Shenzhen

August 23, 2007

CONTRACT OF COOPERATION

Jiancheng Investment Co., Ltd. and Liaocheng Traditional Chinese Medical Hospital (“the Hospital”), through friendly consultation, according to relevant PRC laws and regulations, as well as principles of equality and mutual benefits, decide to jointly establish the Radiation Oncology Research Center (“the Center”) at Liaocheng Traditional Chinese Medical Hospital in Liaocheng City, Shandong Province.

Chapter One: CO-PARTIES

Article 1:    Party A: Liaocheng Traditional Chinese Medical Hospital, Shandong Province (“Party A”)

Legal Representative: Shang Shangang

Position: President

Telephone: 0635 – 8340554

Facsimile: 0635 – 8343956

Postcode: 252000

Address: No. 1 Wenhua Road, Liaocheng City, Shandong

 

Party B: Jiancheng Investment Co., Ltd., Shenzhen (“Party B”)

Legal Representative: Li Jun

Position: Chairman

Telephone: 0755 – 25331498

Facsimile: 0755 – 25331319

Postcode: 518038

Address: Room 507, Plaza B, Yingdali Digital Zone, Futian Free Trade Zone, Shenzhen

Article 2:    The Center Name: Radiation Oncology Research Center at Liaocheng Traditional Chinese Medical Hospital

 

Article 3:    The Center Address: Liaocheng Traditional Chinese Medical Hospital

 

Article 4:    All activities of the Center must comply with laws and regulations of People’s Republic of China (“PRC”).

 

Article 5:    Both Parties agree that during the term of the Contract, Party A will not work with any radiotherapy equipment manufacturer or radiotherapy equipment investor other than Party B. Party A’s non-compliance of such commitment will be treated as serious breach of contract. The default party will compensate any losses herein caused.

  

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Article 6:    If one party transfers part or whole of its shares of the Center during the term of the Contract, the other party shall have an independent or common preemption right under the same conditions.

 

Article 7:    The Center does not belong to any existing department of the Hospital, with independent operation and independent accounting. As a functional department of the Hospital, the Center shall subject to unified control of the Hospital in administration and public management.

Chapter Two: PURPOSE, MANNER, TERM, DUTIES AND DISTRIBUTION PLAN OF THE COOPERATION

 

Article 8:    COOPERATION PURPOSE: through establishment of the radiation oncology research center in the Hospital, active treatment and research will be performed and clinic treatment quality will improve, which in return will help the Center become one of the leading combined clinic-research modern medical organizations in the region and achieve great social and economic benefits.

 

Article 9:    COOPERATION MANNER:

Party B provides:

Medical electronic linear accelerator with high does rate output 400cGY/min 6mv: 1

Automatic 60-pair Muti-leaf collimator treatment system HSR-GW60 (including TPS system): 1

CT-sim analog positioning system (not including CT machine)

Radiotherapy simulator machine: 1

Dose meter:  1

 

Party A provides:

equipment and ancillary room in accordance with requirements of treatment equipment, medical staff, and other auxiliary equipment (including air-conditioner, dehumidifier, and air purifier) as cooperation input.

Article 10:   COOPERATION TERM of the Center is ten (10) years, since the clinic official opening date with treatment of the very first case of illness. By one party’s proposal and unanimous approval of the Council, both Parties may discuss contract extension matters since six (6) months before the cooperation expires.

 

Article 11:   Ownership of assets invested by either party during the cooperation term still belongs to the respective owner.

 

 

  

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Article 12:    Both parties shall distribute income of the Center* during the cooperation term according to the follow:

	
  

	
                 In Year 1, Party A receives 20% and Party B receives 80%;

	
  

	
                 During Year 2 and Year 5, Party A receives 30% and Party B receives 70%;

	
  

	
                 During Year 6 and Year 10, Party A receives 40% and Party B receives 60%.

	
  

	
                * “Income of the Center” means the medical treatment revenue of the Center deducting from operating costs of the Center.

Article 13:    Both Parties shall perform their respective duties as follows:

  Party A’s duties:

	
  

	
1.

	
Since the Contract is executed, Party A shall start preparing Center establishment documentations for all sorts of government approvals and respective costs;

	
  

	
2.

	
Party A is responsible for confirming the Center infrastructure plan and provides equipment room as well as accessory room;

	
  

	
3.

	
Party A is responsible for implementing water, electricity, roads and other infrastructure facilities;

	
  

	
4.

	
Party A is responsible for recommending professional medical staffs in order to provide the Center necessary health care skill support;

	
  

	
5.

	
Party A is responsible for other matters assigned by the Center;

	
  

	
6.

	
After national or local laws and regulations amended or changed, Party A is responsible for assisting Party B in maintaining the normal operations of the Center in accordance with laws and regulations.

  Party B’s duties:

	
  

	
1.

	
It is Party B’s responsibility to invest in radiotherapy equipment that is in compliance with Article 9 of the National Standards;

	
  

	
2.

	
Since the execution date of the Contract, Party B is responsible for delivering the equipment to the place designated by Party A and completes corresponding installment and adjustment, within one (1) months after the hospital equipment room passes qualification test and ready for equipment installment;

	
  

	
3.

	
Party B shall work with Party A on researching and conforming the organization and construction plan, and it shall assist Party A during the construction process;

	
  

	
4.

	
Party B shall work with Party A in establishing management mode and charters of the Center;

	
  

	
5.

	
Party B shall work with Party A in employment of first class domestic and international experts and high-level technical staffs;

	
  

	
6.

	
Party B is responsible for job training the founding medical staffs of the Center before their starting date;

	
  

	
7.

	
Party B is responsible for other matters assigned by the Center.

 

 

  

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8.

	
After Party A provides equipment room and accessory room, Party B shall put all invested equipment/facilities in place. If Party B cannot take action in accordance with its promise, it will reimburse Party A all expenses in infrastructure constructions.

Chapter Three: COUNCIL

Article 14:  The highest authority of the Center is the Council that consists of five (5) members. Two are appointed by Party A and the other three by Party B.  There is one Chairman, appointed by Party B, and one Vice Chairman, appointed by Party A. The terms of Chairman and Vice Chairman are both four (4) years and they can be reelected under the recommendation of the appointing party.

 

Article 15:   As the highest authority of the Center, the Council has the power to make all decisions for the Center except the following important matters which have to be agreed by both parties:

	
  

	
1.

	
The development and modification of the Charter;

	
  

	
2.

	
Confirmation of the Center’s termination or dissolution, after which the Council shall setup a liquidation committee in charging of liquidating the organization and issuing liquidation report;

	
  

	
3.

	
Center key personnel appointment;

	
  

	
4.

	
Other important matters with regard to the Center (which shall be decided by the majority vote of the Council at meeting).

Article 16:  If the Chairman of the Council for some reason cannot fulfill his/her duties, he or she may temporarily delegate his or her power to the Vice Chairman or other council member(s).

 

Article 17:  The Council meeting shall be held twice every year, usually in the first half and second half of the year. The Chairman may hold temporary council meetings. All minutes shall be placed on file.

	
  

	
Chapter Four: ORGANIZATION MANAGEMENT

Article 18:  The Radiotherapy Research Center in the Hospital is under direct governance of the Council and runs according to principle of center-director responsibility. Center directors are in charge of daily Center management.

 

Article 19:  Center shall has one director, recommended by Party B, and one deputy director, recommended by Party A, confirmed and appointed by the Council, with a career term of four (4) years.

 

 

  

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Article 20:  Responsibilities of the Center director include implementing Council’s decisions, in charge of medical treatment, marketing, management, financing and other daily center affairs as well as operation works, directly responsible to the Council. Deputy director’s job is to assist the Center director. The Center may appoint certain number of department heads, in charging of each department activities, accomplishing matters assigned by the Center director and deputy director.

 

Article 21:  If director and/or deputy director’s behavior consists of malpractice or gross negligence on duties, they will be fired at will by the Council meeting.

 

Article 22:  Party A shall assist experts/doctors affirmed by the Council to get medical qualifications and empower them with prescription right.

 

Article 23:  Machinery equipment, accessories, transportation tools and stationary required by the Center, in the case of the same conditions, shall be purchased in China first rather than in any other country (or countries).

 

Article 24:  Any equipment, transportation tools or accessories purchased from abroad shall, according to the PRC Import and Export Commodity Inspection Law, be submitted to the PRC commodity inspection agencies for inspection.

  Chapter Five: CONSTRUCTION OF THE EQUIPMENT ROOM

 

Article 25:  Party A shall take all responsibilities in place choosing, design and construction of the equipment room.

 

Article 26:  Party B is responsible for providing technology requirements on the construction of the equipment room, and shall assist Party A to build the equipment room.

  Chapter Six: LABOR MANAGEMENT

Article 27:  The Council shall determine on employment, dismissal, wages, labor insurance, labor protection, welfare benefits, rewards and punishments of the Center personnel, according to corresponding local labor rules and regulations. The Center shall sign labor contract with individual personnel and shall execute it accordingly.

 

Article 28:  The Council shall determine through discussion on employment, wages and benefits, social benefits, and travel expense standards of the high-level executives recommended by one party or the other.

 

 

 

  

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Chapter Seven: FINANCE, TAX, AND AUDIT

Article 29:  The Center shall establish its accounting sector and equip with accounting personnel, and have its own independent financial accounting, according to relevant laws and regulations. Both Parties shall work together to set up the Center Finance Implementation Rules and according to the Implementation Rules monthly funding and facility maintenance fee will be issued.

 

Article 30:  Center operating expenses include personnel wages, bonus, water/electricity, maintenance and stationary expense as well as other necessary cost the Center pays for.

 

Article 31:  The Center shall have independent accounting and financing with independent bank account. Cashier shall be provided by Party A (and employed by the Council) and Accountant in Chief shall be provided by Party B (and employed by the Council), which forms the finance office of the Center. Finance of the Center shall be cleared every month. Center profits, distracting from Center operation cost, shall be distributed to both Parties according to the distribution percentage rule in Article 8 of the Contract.

 

Article 32:  Financial statements of the Center shall be sent to both parties. Party A shall transfer the profit amount that Party B belongs to into Party B’s designated bank account within one week after such financing statement being received.

 

Article 33:  Either party may do regular or sudden auditing, or joint auditing. Both parties have the right to send professionals from accounting firms or its own accountant to check the Center’s accounting. However, they shall let the other party know at least one week ahead.

 

Article 34:  If the Center needs to pay taxes and management fees, after such payment being made, it shall be added into the Center’s operation cost. If no such payment needs to be made, neither party would take any responsibility underneath this provision.

 

Article 35:  The Center shall take out public accumulation fund and public welfare fund in accordance with relevant laws and regulations. The Council, according to the Center’s income and expenditure during that year, shall determine the annual takeout percentage.

 

Article 36:  Party A shall promise to separate income of the Center from its other incomes. With the exception of stipulation in Article 31 that Party A shall transfer Party B’s percentage amount into its account or otherwise performance under the Council’s orders, Party A shall not move funds at its will and shall act in accordance with the Council’s determinations.

 

 

  

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Chapter Eight: ASSET DISPOSAL AFTER THE TERM EXPIRES

 

Article 37:  At the time when the term of the Contract expires, after the Center’s assets got liquidated, the initial investment into the Center of each party shall still belong to itself. Other assets which were purchased by the Center during the time it exists shall be distributed equally (5:5) into both parties.

Chapter Nine: INSURANCE

Article 38:  All fixed assets of the Center are covered by insurance. The Council shall decide the type of policies, value, and term according to standards provided by the insurance company. The Center shall place the medical malpractice liability insurance. Once medical malpractice or related dispute happens in the Center, the Hospital shall handle it on behalf of the Center.  If financial damage incurred, insurance is the way to solve it. In the event insurance not covering, the Center shall solve the problem directly and any related expenses should be counted as operating cost.

Chapter Ten: CONTRACT MODIFICATION, CHANGE AND TERMINATION

Article 39:  Any modifications on the Contract and its attachments may be taken into effect only after legal representatives of both parties executed certain written agreement.

 

Article 40:  During the cooperation period, both parties shall adjust their mode of cooperation in accordance with changes made in the national policies with respect to cooperative medical institutes.

 

Article 41:  Due to changes of national policies or other force majeure that led to contract non-performance or long-term loss to the Center, both parties, by their mutual agreement, may terminate the Contract before its expiration date.

 

Article 42:  When force majeure that is unexpected, unavoidable and the consequence of which cannot be prevented, including but not limited to earthquake, typhoon, flood and warfare, happened, one party shall immediately notify the other party by telegraph and within fifteen (15) days after the accident happened, provide information about the negative impact the accident had on performance of the Contract. Both parties shall decide, after mutual agreement, whether to terminate the Contract, or partially exempt performance of the Contract or delay performance of the Contract.

 

Article 43:  If breach of contract or other reasons that lead to neither parties being able to cooperate with each other occurred and the Contract is terminated in the middle way, liquidation process shall be triggered. The main principle in liquidation is Party B takes back all the radiotherapy equipment it invested and Party A gets back all its facilities. The Center’s debts and credits, as well as all of the fixed assets it purchased when clinic was in operation shall be distributed to both parties due to the number of years of cooperation in accordance with the guide rules stipulated in Article 12.

 

  

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Chapter Eleven: DEFAULT RESPONSIBILITIES

Article 44:  Default occurs when either party breaches any provision in the Contract.

Article 45:  Material breach of contract occurs when either party unilaterally misappropriates the Center’s fund/profits without the Council’s unanimous consent or either party unilaterally moves away radiotherapy equipment Party B invested without the Council’s unanimous consent. The defaulting party shall compensate any resulting losses/damages.

 

Article 46:  If the Center cannot operate normally or the purpose of operation stipulated in the Contract cannot be reached due to one party’s non-strict fulfillment of its contract obligations or its material breach of contract or material noncompliance of its charter, the other party who complies with the Contract may terminate the Contract unilaterally or is entitled to collect from breaching party (including direct loss and loss of expected benefits).

	
  

	
Chapter Twelve: JURISDICTION

Article 47:  The contract formation, validity, interpretation, implementation and dispute shall be protected and governed by laws of People’s Republic of China.

	
  

	
Chapter Thirteen: DISPUTE RESOLUTION

  Article 48: Both parties shall try their best to resolve any dispute in execution of the Contract or any related disputes,  through friendly consultation. If dispute still cannot be solved, either party shall submit the case to the People’s Court where the Center is located for ruling.

	
  

	
Chapter Fourteen: CONTRACT EXECUTION AND OTHERS

Article 49:  The Contract and its attachments shall entry into force after signed and sealed by both parties.

 

Article 50:  Any notification delivery method between the parties, like telegraph or facsimile, if involved with rights and obligations of any party or parties, shall be promptly made in written letterform. The legal address indicated in the Contract is also the mailing address of the parties.

 

  

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Article 51:  The Contract has four copies, two of which are held by each party. The Contract shall take into effect by official execution from legal representatives of both parties.

	
  

	
Party A:   Liaocheng Traditional Chinese Medical Hospital

	
  

	
                  (sealed)

	
  

	
                  Legal Representative: Shang Shangang

	
  

	
                  August 23, 2007

	
  

	
Party B:   Jiancheng Investment Co., Ltd.

	
  

	
                 (sealed)

	
  

	
                 Legal Representative: Li Jun

	
  

	
                 August 23, 2007

 

 

 

 

  

- 13-daneexh10_3.htm

Exhibit 10.3

 

JUDY 1 and McDAME MOUNTAIN CLAIMS

SITE SERVICE AGREEMENT

THIS AGREEMENT made effective as of the 8th day of July, 2011.

BETWEEN:

S.G. DIAKOW, .....................................................................................................

 

(the "Contractor")

OF THE FIRST PART

AND:

 

DANE EXPLORATION INC., 3577 - 349 West Georgia Street, Vancouver,

British Columbia, Canada, V6B 3Y4

 

(the "Client")

OF THE SECOND PART

 

W H E R E A S:

 

	
A.

	
The Client is the owner or has an interest in the land/mineral claims described in Schedule "A" hereto (herein called the "Property");

 

	
B.

	
The Client requires the services of a contractor to perform the work and services outlined in outlined in Schedule "B" herein (herein called the "Work Program");

 

	
C.

	
The Contractor has agreed with the Client to undertake the Work Program on the terms and conditions herein contained, or to arrange for an alternate service provider to be contracted on the on the same, or similar, terms to those included in this Service Agreement.

 

 

NOW THEREFORE THIS AGREEMENT WITNESSETH that the consideration of the covenants and agreements herein contained the parties hereto agree as follows:

 

	
1.

	
Definitions:

 

	
  

	
(a)

	
“AGREEMENT” shall mean this Service Agreement between Mr. S.G. Diakow and Dane Exploration Inc. dated July 8, 2011, as amended from time to time, including all attachments, exhibits, and schedules hereto.

 

	
  

	
(b)

	
“BUDGET” shall mean the estimated cost of the Work Program.

 

	
  

	
(c)

	
“EFFECTIVE DATE” shall be a mutually agreed date to be determined after the Client has successfully raised a minimum of US$50,000 through the sale of common shares of the Client, subsequent to July 8, 2011, and shall mean the date this Agreement becomes effective.

 

 

 

  

1

  

 

 

	
  

	
(d)

	
“PERSONNEL” shall mean S.G. Diakow’s permanent and temporary employees, officers and subcontractors involved in the execution and performance of the present Agreement.

 

	
  

	
(e)

	
“PROPERTY” shall mean the Judy 1 and McDame Mountain Claims, as specified in Schedule ‘A’ hereto.

 

	
  

	
(f)

	
“SERVICE FEE” shall mean fee incurred by the Contractor for personnel, equipment, and services provided or supplied with respect to the Work Program plus an administration fee of 15%.

 

	
  

	
(g)

	
“WORK PROGRAM” shall mean all of the services to be performed by S.G. Diakow as designated in Schedule “B” as the work and services to be performed by the Contractor.

 

	
2.

	
Contractor's Services

 

	
  

	
(a)

	
The Contractor shall perform the work and provide the services with respect to the Work Program as designated in the Budget as the work and services to be performed by the Contractor and, such additional work and services as may from time to time be mutually agreed to by the Contractor and the Client.

	
  

	
(b)

	
In the event that the Contractor is requested to perform any services or work which falls outside of the scope of the Work Program defined herein, it shall forthwith perform the same and the Client agrees to compensate the Contractor for such additional work and services performed.

	
  

	
(c)

	
The Contractor shall, in addition to the Work Program defined herein, perform the following duties:

	
  

	
(i)

	
at the cost of the Client, apply for and maintain in full force and effect any and all governmental permits and approvals required for the lawful undertaking of the Work Program;

	
  

	
(ii)

	
comply with all terms and conditions applicable to the Client or the Work Program contained in any governmental permit or approval required or obtained for the lawful prosecution of the Work Program, or in any insurance policy affecting or covering the Work Program, or in any surety bond obtained in connection with the Work Program;

	
  

	
(iii)

	
furnishing such consultation and advice relating to the Work Program as may be reasonably requested from time to time by the Client;

	
  

	
(iv)

	
keeping the Client fully informed on a regular basis of the progress of the Work Program, including the preparation of such reports as are provided for herein or as may reasonably be requested by the Client and which are of a nature generally requested or expected of contractors on similar projects;

 

 

  

2

  

	
  

	
(d)

	
The Contractor shall report on the progress of the Work Program every two weeks, which report shall include:

	
  

	
(i)

	
the cost incurred to date of the report for the Work Program;

	
  

	
(ii)

	
comparison of the costs of the Work Program contained in the budget with the actual costs of the Work Program to the date of the report;

	
  

	
(iii)

	
an estimate of any anticipated cost over-runs for any item contained in the Budget.

	
  

	
(e)

	
The Contractor shall hire and retain at the expense of the Contractor and as employees of the Contractor, and not as employees of the Client, such personnel as may be required to properly perform the Contractor's function hereunder.  The compensation, retention and performance of employees hired by the Contractor at its own expense shall be controlled exclusively by the Contractor, and the Contractor shall be responsible for complying with all laws and regulations affecting such employment, including the provision of any benefits or compensation requested by statute or contract.

 

	
3.

	
Budget

 

	
  

	
As soon as practicable after minimum funding of US$50,000 has been secured by the Client through sales of its shares subsequent to July 8, 2011 and the Work Program has been determined, and in any event prior to commencement of the Work Program, the Contractor shall prepare and submit to the Client for its review and approval a budget for the Work Program (herein the "Budget") showing the estimated cost of the Work Program broken down by line item, including a reasonable allowance for contingencies and reserves.  The Contractor shall update the Budget as and when any material change occurs in the Work Program or in the assumptions of the items contained in the Budget.  The approval by the client of the Budget, including any amended Budget, shall constitute approval to the Contractor to make any expenditures described therein or actions reasonably necessary to carry out such budgeted expenditures.  However, this shall not preclude the Contractor from performing services and incurring expenses under the Work Program whether original or amended, prior to approval of the Budget by the Client, and any such expenditure by the Contractor shall be reimbursed by the Client as per Paragraph 4 of the Contract.

 

	
4.

	
Compensation

 

	
  

	
(a)

	
As compensation for the services to be provided by the Contractor hereunder, the Client shall pay to the Contractor a "Service Fee" for the personnel, equipment and services provided or supplied with respect to the Work Program at the rates equal to the Contractor's charge out rates for such personnel, equipment and services, plus a 15% fee. The Contractor shall prepare and deliver to the Client bi-monthly statements showing the amount of the Contractor's Service Fee for the preceding bi-monthly period and the Client shall cause the Contractor's Service to be paid within fifteen (15) days of the receipt of the said statement setting forth the Contractor's Service Fee.

 

 

  

3

  

 

	
  

	
(b)

	
In the event that the Client directs or instructs the Contractor to perform or furnish any services or work which falls outside the scope of the Work Program and/or the services to be provided herein, the Contractor shall be entitled to receive such additional compensation as shall be mutually agreed upon, or in the absence of such agreement as shall be reasonable and equitable under the circumstances.

	
5.

	
Duration and Termination

   (i).  Initial Term and Renewal

	
  

	
The initial term during which S.G. Diakow shall be obligated to perform the work and services under the present agreement shall commence on the Effective Date and end upon final Completion of the Work Program.

   (ii). Early Termination

 

	
  

	
This Agreement shall terminate and be at an end in the event that:

 

	
  

	
(a)

	
Termination by Mutual Agreement

 

	
  

	

The Parties may mutually agree to terminate this Agreement;

 

	
  

	
(b)

	
Termination for Contractor’s bankruptcy or insolvency

	
  

	
The Client shall have the right to terminate the present Agreement upon 30 (thirty) days written notice to the Contractor in the event the Contractor files a voluntary assignment in bankruptcy or is to be adjudicated as bankrupt or insolvent, or files any petition seeking a reorganization arrangement, liquidation, dissolution or similar relief under any present or future law relating to bankruptcy, insolvency or other relief for debtors or shall seek, consent to or acquiesce in the appointment of any trustee, receiver, conservator or liquidator of the Contractor, or of all or a substantial part of its assets;

 

	
  

	
(c)

	
Termination for non-performance of work and services by Contractor

 

	
  

	
(i)

	
In the event the Contractor fails to perform the Work Program in the manner or within the time required or commits or permits a breach of or default in any of its duties, liabilities or obligations hereunder and fails to fully cure or remedy such failure, breach or default within thirty (30) days after written notice specifying the nature of such failure, breach or default by the Contractor, or if such breach or default cannot be reasonably cured within the said thirty (30) days, fails to commence such cure or remedy within the said thirty (30) day period or at any time thereafter fails to diligently prosecute such cure or remedy to completion, the Client shall have the right to terminate the Agreement upon 30 (thirty) days written notice to the Contractor. If the Contractor fails repeatedly to perform its

  

4

  

 

	
  

	
obligations under this Agreement in a timely or satisfactory fashion and thereby materially interferes with the Client's schedule for completion of the Work Program, provided that the Client has previously notified the Contractor in writing of one or more prior failures to perform in a timely or satisfactory fashion and the Contractor has failed to or could not correct such prior failure, and, in one or more subsequent instances, has failed to perform its obligations in a timely or satisfactory fashion, the Client shall have the right to terminate the Agreement upon 30 (thirty) days written notice to the Contractor.

	
  

	
(d)

	
Termination for non-payment of Service Fee by Client

	
  

	
In the event the Client fails to pay the Contractor's Service Fee from time to time as and when the Service Fee shall be due and payable, the Contractor shall have the right to terminate the Agreement upon 30 (thirty) days notice to the Client.

	
  

	
(e)

	
Termination for change in control

	
  

	
In the event of the Client disposing of all or any part of its interest in the Property prior to the completion of the Work Program by the Contractor without the prior consent of the Contractor, the Contractor shall have the right to terminate the Agreement upon 30 (thirty) days written notice.

	
  

	
(f)

	
Termination for non-approval for Amended Budget, Excessive, Unnecessary or Unreasonable Costs

 

The client shall have the right to terminate the Agreement upon 30 (thirty) days written notice in the event that:

 

	
  

	
(i)

	
the Client does not approve any amended Budget or Work Program submitted to it by the Contractor;

	
  

	
(ii)

	
the cost of carrying out the Work Program exceeds the Budget by an amount exceeding fifteen (15%) percent of the Budget;

	
  

	
(iii)

	
the contractor incurs costs which are unnecessary or unreasonable and not in accordance with prudent and generally accepted industry practices.

 

	
6.

	
Ownership of Information and Material

 

	
  

	
The Contractor shall, upon completion of the Work Program or any sooner termination of this Agreement, deliver to the Client all written data and information generated by or for the Client in connection with the Work Program, and all drawings, plans, books, records, contracts, agreements and all other data, information and documents in its possession relating to its services or the Work Program, and the Client shall have the right to use the same without further compensation to the Contractor.  The Contractor agrees, for itself and all personnel retained or employed by the Contractor in

 

 

  

5

  

 

 

	
  

	
performing its services, to hold in confidence and not to use or disclose to others any confidential or proprietary information or data of the Client which came within the knowledge of the Contractor as a result of its services, except where (i) the Client specifically authorizes the Contractor to disclose any of the foregoing to others or such disclosure reasonably results from the performance of the Contractor's services hereunder, or (ii) such data or information shall have theretofore been made publicly available by parties other than the Contractor or any such persons.

 

	
7.

	
Licenses

 

	
  

	
The Contractor shall, at its own expense, qualify to do business and obtain and maintain such licenses as may be required for the performance by the Contractor of its services.

 

	
9.

	
Indemnity

 

	
  

	
(a)

	
The Contractor hereby agrees to indemnify, defend and hold harmless the Client from and against any and all claims, demands, losses, liabilities, actions, lawsuits and other proceedings, judgments and awards, and costs and expenses (including reasonable legal fees), arising directly or indirectly, in whole or in part, out of the negligence or any willful act or omission of the Contractor, or any of its officers, directors, agents or employees in connection with this Agreement or the Contractor's services or work hereunder,  within the scope of its duties or authority hereunder.  The provisions of this paragraph shall survive the termination of this Agreement.

	
10.

	
Independent Contractor

 

	
  

	
In performing its services hereunder, the Contractor shall be an independent contractor and not an employee or agent of the Client.

 

	
11.

	
Severability

 

	
  

	
Each provision of this Agreement is intended to be severable.  If any term or provision hereof shall be determined by a court of competent jurisdiction to be illegal or invalid for any reason whatsoever, such provision shall be severed from this Agreement and shall not affect the validity of the remainder of this Agreement.

  

6

  

 

 

	
15.

	
Governing Law

	
  

	
This Agreement is entered into in the Province of British Columbia, Canada and shall be governed by the laws thereof.

 

	
16.

	
Time of Essence

 

	
  

	
Subject to the provision of Paragraph 17, time is of the essence in the performance of this Agreement.

 

	
17.

	
Force Majeure

 

	
  

	
A delay in or failure of performance by either party hereto other than the payment of money, shall not constitute a default, nor shall the Client or the Contractor be held liable for loss or damage, if and to the extent that such delay, failure, loss or damage is caused by occurrences beyond the reasonable control of such party, and its agents, employees, contractors, subcontractors and consultants, including but not limited to Acts of God, expropriation or confiscation of facilities, compliance with any order or request of any governmental authority or person purporting to act therefore, acts of declared or undeclared war, weapon of war employing atomic fission or radioactive force, whether in the time of peace or war, public disorders, rebellion, sabotage, revolution, earthquake, floods, riots, strikes, labour or employment difficulties, delays in transportation, inability of a party to obtain necessary materials or equipment or permits due to existing or future laws, rules or regulations of governmental authorities, or any other causes, whether direct or indirect, and whether or not of the same class or kind as those specifically above named, not within the reasonable control of such party, or its agents, employees, contractors, subcontractors and consultants, and which by the exercise of reasonable diligence the said party is unable to prevent.  However, (i) the Contractor shall not be entitled to the benefits of this Paragraph 17 unless it gives prompt written notice to the Client of the existence of any event, occurrence or condition which it believes permits a delay in the performance of its obligations pursuant to this Paragraph 17, and (ii) no such event, occurrence or condition referred to in this Paragraph 17 shall prevent the parties from terminating this Agreement pursuant to Paragraph 5.

	
20.

	
Modification of Agreement

	
  

	
This Agreement constitutes the entire agreement between the parties hereto.  To be effective any modifications of this Agreement must be in writing and signed by the party to be charged thereby.

 

	
21.

	
Headings

 

	
  

	
The headings of the Paragraphs of this Agreement are inserted for convenience of reference only and shall not in any manner affect the construction or meaning of anything herein contained or govern the rights or liabilities of the parties hereto.

 

 

  

7

  

 

 

	
22.

	
Interpretation

	
  

	
Whenever the content requires, all words used in the singular number shall be deemed to include the plural and vice versa, and each gender shall include any other gender.

 

	
23.

	
Notices

 

	
  

	
All notices, requests and communications required or permitted hereunder shall be in writing and shall be sufficiently given and deemed to have been received upon personal delivery or, if mailed, upon the first to occur of actual receipt of forty-eight (48) hours after being placed in a regularly maintained receptacle for the deposit of mail, postage prepaid, registered or certified mail, with return receipt requested, addressed to the above parties as follows:

 

 

	 	 CLIENT:	
DANE EXPLORATION INC.

3577 - 349 West Georgia Street

Vancouver, British Columbia, Canada, V6B 3Y4

Tel:   604.805.7292

Fax:  604.241.8411

	 	 	 
	 	 CONTRACTOR:	
S.G. DIAKOW

.......................

.........................................................................................

..................................

..................................

 

Notice of a change in address of one of the parties shall be given in writing to the other party as provided above, but shall be effective only upon actual receipt.

IN WITNESS WHEREOF, the parties have hereunto set their hands as of the day and year first above written.

DANE EXPLORATION INC.,

/s/ David Christie

David Christie, President & CEO

Contractor:

/s/ S.G. Diakow

S.G. Diakow

 

 

  

8

  

SCHEDULE "A"

PROPERTY DESCRIPTION: Judy 1 and McDame Mountain Claims

'Property' shall mean British Columbia Mineral Tenure 735182 (the “Judy 1 Claim”) and British Columbia Mineral Tenure 821402 (the “McDame Mountain Claim”), both located 2 kilometres (1.5 miles) northeast of Cassiar, British Columbia, Canada, comprising an area of 627.96 hectares (1551.68 acres) on McDame Mountain, British Columbia, Canada.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  

9

  

 

 

SCHEDULE "B"

 

DESCRIPTION OF WORK AND SERVICES

TO BE PERFORMED BY CONTRACTOR AND CHARGES

It appears the Judy 1 and McDame Mountain claims (the 'Judy Claims'), are underlain by both Sylvester and McDame Group rocks in proximity to a granitic pluton (Cassiar intrusive) and a major fault zone, the area has attractive mineral potential that should be investigated by reference to various data sources and by field work. Of particular interest will be the publications, both historic and recent, of the provincial Ministry of Energy and Mines. Review of the regional geochemical data may help focus exploration initiatives but will not take the place of ground-based prospecting efforts. A suitably equipped experienced prospecting team should spend about one week performing a reconnaissance survey of the entire claim. They should record the various rock types, structures and any mineral zones and submit appropriate rock, soil and stream sediment samples for analysis. The cost of this program of Phase 1 work will be approximately US$11,500 and when completed the results of the work should be considered with reference to the regional database to determine if further work is justified.

A second program of work should be undertaken if sufficient encouragement is obtained from the prospecting and reconnaissance survey work. It can be anticipated that the program if justified, will include further rock and soil geochemistry sampling, a limited amount of trenching using hand tools and dynamite, additional geochemical sampling, and simple geophysical survey methods. A Phase 2 budget of  US$36,000 is recommended, but is likely scalable down to $17,500. This would include four person crew to prospect, sample and, possibly, trenching and geophysical surveys. Allow for two weeks field work, 50 rock samples. 150 samples, rental of portable rock drill, explosives.

Completion of Phase 2 should be followed again by a thorough review of data obtained. One or more areas of mineral potential should have been recognized and at least partially defined.

A Phase 3 program is speculative, depending upon the location and configuration of the mineral zones. It is likely that further geophysical surveys with different techniques or more densely spaced observations, will be required to assist in designing a program of diamond drill holes to test the deeper potential of the “best” parts of the area. Costs, including the cost of a limited drilling campaign, are difficult to estimate but in a somewhat remote area such as McDame Mountain are likely to be fairly high. Phase 3 should be expected to cost a scalable total of up to US$350,000.

 

 

 

 

 

 

 

 

 

 

 

  

10

  

 

 

SCHEDULE "B"

 

BUDGET (US Dollars) – all cost estimates include 15% Service Fee component

	(a)	Phase 1 – Preliminary Work  – Review of Regional Database:	 	 	 	 
	 	

allowance for purchase of maps, air photographs, publications

	 	$	500.00	 
	 	
review files at Geological Survey Branch, Victoria and

	 	 	 	 
	 	
Vancouver, allowance for travel and living expenses 

	 	$	500.00	 
	 	
wages

	 	$	600.00	 
	(b)	

Phase 1  - Field Work  –  Two person prospecting crew, five days in the field:

	 	 	 	 
	 	
mobilization to Cassiar district, travel costs, et al., allow

	 	$	1,500.00	 
	 	
prospecting and camping gear

	 	$	200.00	 
	 	
groceries and other supplies

	 	$	500.00	 
	 	
analytical costs, including freight, 80 samples

	 	$	1,600.00	 
	 	
wages – for two persons for five days @ $800/day

	 	$	4,000.00	 
	 	
assembling and reporting results of field work allow

	 	$	600.00	 
	Anticipated Cost of Preliminary Review and Field Work	 	$	10,000.00	 
	Allowance for unscheduled expenses @ 15%	 	$	1,500.00	 
	 	 	 	 	 
	PHASE 1 - Anticipated Cost of Preliminary Phase 1 Review and Field Work:	 	$	
11,500.00

	 

 

 

Phase 2 – Follow- up Work

	
Phase 2 – Initial Drilling and Trenching – Four person crew to prospect, sample and, possibly, trenching and geophysical surveys. Allow for two weeks field work, 50 rock samples. 150 samples, rental of portable rock drill, explosives:

	 
	
mobilization to Cassiar district, including travel

	 	$	2,500.00	 
	
equipment & provisions

	 	$	4,900.00	 
	
drill and backhoe rentals, based on a small Kabota type tracked

	 	 	 	 
	
backhoe and use of ATV’s to access target zones

	 	$	10,100.00	 
	
assays, including freight costs

	 	$	2,000.00	 
	
wages

	 	$	14,000.00	 
	
reports to analyze results of chip samples produced from trenching

	 	$	500.00	 
	
Anticipated Cost of Initial Drilling and Trenching Work

	 	$	34,000.00	 
	
Allowance for unscheduled expenses @ 15%

	 	$	2,000.00	 
	  	 	 	 	 
	
PHASE 2 - Anticipated Cost of Initial Drilling and Trenching Work:

	 	$	36,000.00	 

 

 

Phase 3 – More surveys, followed by diamond drilling

 

Selected target areas will have to be more carefully detailed in order to identify drill sites. Geophysical surveys, either of a different method or on a more dense grid, should clarify the type of structure being investigated and will ensure that diamond drill holes are placed in the most prospective areas. Speculatively, an initial drill program of 1500 to 2000 meters is likely to be required.  Drilling costs in the Cassiar area are in the range of $60 to $70 per foot of drilling. All-in costs, based on using a light weight helicopter portable drill rig, are estimated in the range of $60,000 to $70,000 per 1,000 feet of drilling.

 

	
PHASE 3 - Anticipated Cost of More surveys, followed by diamond

	 	 	 	 
	
drilling are estimated at:

	 	 	$	45,000	 
	  	 to	 	$	350,000	 

 

 

  

11

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