Document:

ex10_641.htm

Exhibit 10.64.1

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (“Agreement”) is entered into by and between Bradley W. Evans (“Evans”) and the Board of Directors of Chugach Electric Association, Inc., an Alaska electrical cooperative association headquartered in Anchorage, Alaska (“Chugach” or “Employer”).

WITNESSETH:

WHEREAS, Chugach is engaged in the business of production, transmission and distribution of electricity in Alaska;

WHEREAS, Evans has skills and experience in electric utility management transmission and distribution of electricity; and

WHEREAS, Chugach desires to obtain Evans’ services as the Chief Executive Officer of its business, and Evans desires to be employed in that position by Chugach;

NOW, THEREFORE, in consideration of the premises and the mutual covenants herein set forth, the parties hereto agree as follows:

1.           Employment.   Chugach hereby employs Evans as its Chief Executive Officer and Evans hereby accepts such employment upon the terms and conditions hereinafter set forth.

2.           Duties.

a.  Evans shall serve as Chugach’s Chief Executive Officer and shall perform his services as such within the framework of Chugach’s bylaws, policies, procedures and goals as Chugach’s Board of Directors shall from time to time determine, including but not limited to the following:

	
  

	
(i)

	
Board Policy 106, Delegations of Authority from the Board of Directors to the Chief Executive Officer, Appendix A hereto;

	
  

	
(ii)

	
Board Policy 107, Board of Directors – Chief Executive Officer Relationship, Appendix B hereto; and

	
  

	
(iii)

	
Board Policy 118, Delegation of Certain of the Secretary’s and Treasurer’s Duties to the Chief Executive Officer, Appendix C hereto.

In such capacity, Evans (i) shall exercise general supervisory responsibility and management authority over Chugach and all of its controlled affiliates, and (ii) shall perform such other duties commensurate with his position as may be assigned to him from time to time by the Chugach Board of Directors.

  

  

  

b.  Evans shall devote substantially all his business time, attention and energies to the performance of his duties and functions under this Agreement and shall not during the term of his employment hereunder be engaged in any other substantial business activity for gain, profit or other pecuniary advantage.  Evans shall faithfully, loyally and diligently perform his assigned duties and functions and shall not engage in any activities whatsoever that conflict with his obligations to Chugach during the term of his employment hereunder.  Notwithstanding the foregoing, nothing in the foregoing shall be construed so as to limit or prohibit personal investments by Evans; provided that such investments shall not amount to a controlling interest in any entity (other than trusts, limited partnerships or other entities adopted by Evans for estate planning purposes).  Evans also agrees that he will not participate in any political activity that will or may reflect adversely upon Chugach without obtaining the prior consent of Chugach’s Board of Directors.

c.  Chugach shall furnish Evans with an office and other facilities at Chugach’s headquarters location and services that are suitable to his position and adequate for the performance of his duties and functions hereunder.

3.  Term of Agreement.  The term of this Agreement shall be for a period of two (2) years commencing July 1, 2011, and ending June 30, 2013.  If the board has not given notice of renewal/termination by April 30, 2013, the contract will extend for one additional year.

4.  Compensation.  Chugach shall pay to Evans, in consideration of and as compensation for the services agreed to be rendered by Evans hereunder, the following:

a.  Salary.  During the first year of this Agreement (July 1, 2011 – June 30, 2012), Chugach shall pay to Evans an annual salary of Three Hundred Thousand Dollars ($300,000.00 US) (the “Base Salary”), payable in regular installments on Chugach’s normal paydays, less any applicable withholdings required by law or any applicable deductions authorized by Evans.  During the second year of this Agreement (July 1, 2012 – June 30, 2013),  Chugach shall pay to Evans an annual salary of Three Hundred Thousand Dollars ($300,000.00 US) (the “Base Salary”), payable in regular installments on Chugach’s normal paydays, less any applicable withholdings required by law or any applicable deductions authorized by Evans.

b.  Discretionary Bonuses.  In its sole discretion, the Board of Directors may award to Evans a performance-based bonus and/or an incentive-based bonus in accordance with Sections 4.b.1 and 4.b.2 below.

1. The Board of Directors may, in its sole discretion, establish performance-based objectives for Evans and assign a fixed dollar amount or percentage of Base Salary bonuses for the successful achievement of those objectives.  The stated objective(s) will be provided to Evans by the Board of Directors and may be updated from time to time as the Board sees fit.  For each objective met, Evans will be awarded the bonus associated with that objective, said payment(s) to be made within thirty (30) days of the Board’s determination, less any applicable withholdings required by law or any applicable deductions authorized by Evans.  The parties acknowledge that such bonus payments to Evans, if any, are not considered compensation under any of the retirement plans offered by Chugach and therefore will not be considered in determining Evans’ retirement benefits.

  

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2. During the second year of this Agreement (July 1, 2012 – June 30, 2013), the Board of Directors may, in its sole discretion, award to Evans an incentive based bonus of a maximum of $50,000, less any applicable withholdings required by law or any applicable deductions authorized by Evans.  The parties acknowledge that such bonus payments to Evans, if any, are not considered compensation under any of the retirement plans offered by Chugach and therefore will not be considered in determining Evans’ retirement benefits.

c.  Use of Company Vehicles.  During the Employment Term, Evans shall be permitted to use Chugach vehicles on company business on a de minimus basis.  Evans shall not be entitled to a company vehicle for personal use.

5.  Chugach Provided Benefits.  During the term of this Agreement and if available then, Evans shall be entitled to participate in all group health, pension, 401(k), deferred compensation plans, employer-paid long-term disability insurance and life insurance coverage and other fringe benefit programs maintained by Chugach and provided to its salaried administrative personnel, on the same terms as apply to participation therein by such personnel generally (except as otherwise provided herein).

6.  Holidays, Sick Leave and Annual Leave.  Evans shall be entitled to such holidays, sick leave and annual leave as are provided to Chugach’s salaried administrative personnel generally.

7.  Expenses.  During the term of this Agreement, Chugach shall reimburse Evans for all reasonable travel, entertainment and other business expenses incurred or paid by Evans in performing his duties and functions hereunder, subject to Evans’ accounting for and reporting such expenses pursuant to applicable Chugach policies.

8.  Non-Competition.  During the term of this Agreement, during any extension thereof, and for a period of six months after termination of this Agreement, Evans shall not enter into or participate in any business competitive to the business carried on by Chugach in Southcentral Alaska or at such additional locations, if any, outside Southcentral Alaska at which Chugach conducts business. As used herein, the term “business competitive to the business carried on by Chugach” means any business that involves the production, transmission or distribution of electricity, and the words “Southcentral Alaska” mean a business conducted in whole or in part within the boundaries of the Municipality of Anchorage, the Kenai Peninsula Borough, or the Matanuska-Susitna Borough.  The provisions of this Section 8 shall survive the expiration and/or termination of this Agreement.  If a court of competent jurisdiction should declare any or all of this provision unenforceable because of any unreasonable restriction of duration and/or geographical area, then such court shall have the express authority to reform this provision to provide for reasonable restrictions and/or to grant Chugach such other relief, at law or in equity, as is reasonably necessary to protect its interests.

  

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9.  Confidential Information.  During the term of this Agreement and at all times thereafter, Evans will not use for his own advantage or disclose to any unauthorized person any confidential information relating to the business operations or properties of Chugach and any affiliate of Chugach.  Upon the expiration or termination of this Agreement, upon Chugach’s request, Evans will surrender and deliver to Chugach all documents and information of every kind relating to or connected with Chugach and its affiliates.  As used herein “confidential information” means all information, whether written or oral, tangible or intangible, of a private, secret, proprietary or confidential nature, of or concerning Chugach and its business and operations, including without limitation, any trade-secrets or know-how, computer software programs in both source code and object code, information regarding any product or service, development, technology, technique, process or methodology, any sales, promotional or marketing plans, programs, techniques, practices or strategies, any expansion or acquisition plans, any operational and management guidelines, any cost, pricing or other financial data or projections, and any other information which is to be treated as confidential because of any duty of confidentiality owed by Chugach to any third party or any other information that Chugach shall, in the ordinary course of its business, possess or use and not release externally without restriction on use or disclosure.  The foregoing confidential information provision shall not apply to information which: (i) is or becomes publically known through no wrongful act of Evans, (ii) is rightfully received from any third party without restriction and without breach by Evans of this Agreement, or (iii) is independently developed by Evans after the term of his employment hereunder or is independently developed by a competitor of Chugach at any time.  The provisions of this Section 9 shall survive the expiration and/or termination of this Agreement.

10.  Termination.

a.  Termination for Cause.  Chugach may terminate Evans’ employment for “cause” immediately upon written notice to Evans, provided, however, that Evans must be given ten (10) days written notice of cause for termination and the opportunity to cure such cause within that time if the Board in its reasonable discretion determines that (1) the cause for termination is capable of being cured and (2) no similar conduct or failure that was previously cured has occurred.  Such notice shall specify in reasonable detail the acts or omissions that constitute cause for termination.  For purposes of this Agreement, “cause” means a business-related reason that is not arbitrary, capricious or illegal and which is based on facts (i) supported by substantial evidence, and (ii) reasonably believed by the Board of Directors to be true.  Examples of “cause” for termination of employment are provided in Chugach Operating Policy 013 dated September 19, 2001, and are incorporated herein by reference to the extent they are consistent with this Agreement, and may also include the following:  willful and repeated failure or refusal to carry out reasonable orders, instructions, or directives of the Board of Directors; material acts of dishonesty, disloyalty or competition related to the business of Chugach or its relationships with employees, suppliers, contractors, customers or others with whom Chugach does business; refusal or failure to furnish material information concerning Chugach’s affairs as reasonably requested by or under the authority of the Board of Directors, or falsification or misrepresentation of such information, conviction of a crime constituting fraud, intentional dishonesty, moral turpitude, or other conduct that materially compromises the reputation of the employee or Chugach; or any other act, course of conduct, or omission that has or is reasonably likely to have a material adverse effect on Chugach, its business or financial position, or its goodwill or reputation.

  

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In the event of the involuntary termination of his employment for cause, Evans shall not be entitled to receive any compensation or benefits hereunder other than (1) his Salary earned through the effective date of Evans’s termination, (2) accrued, unused annual leave, and (3) vested employee benefits under the terms and conditions of the governing plan documents and policies.  In the event of termination for cause under this Section, Evans’ obligations under Sections 8 and 9 shall continue under the terms and conditions of this Agreement.

b.  Termination Without Cause.  Chugach may terminate Evans’ employment without cause at any time during the term of this Agreement or any extension thereof.  Upon such termination without cause and provided that the Consideration Requirements (as defined below) are satisfied, Chugach shall pay the following subject to the terms below:

(i)  a lump sum payment equal to 50% of his annual Base Salary  payable within ninety (90) days of the termination of employment; and

(ii)  the full cost of any continuation coverage required under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, for a period not in excess of 6 months on an after-tax basis and thereafter Evans shall be charged the full cost of such coverage.  If Evans becomes reemployed with another employer and is eligible to participate in such employer’s health care plan, then Chugach shall not be obligated to pay the cost of any continued coverage after the date of such reemployment for Evans and any of Evans’ dependents.

(iii) The amounts described above under (i) and (ii) above shall collectively be referred to as “Severance.”

For purposes of this Agreement, “Consideration Requirements” means all of the following: (i) Evans executes and returns to Chugach a separation agreement in a form acceptable to Chugach, which shall include a full waiver and release of all claims by Evans against Chugach, its affiliates, and their officers, directors, employees and agents, (ii) the revocation period for the separation agreement has lapsed without revocation, and (iii) Evans has not entered into a consulting agreement with Chugach, as contemplated by Section 11.

  

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In the event of a termination without cause under this Section 10(b), Evans also will be entitled to receive (1) his Salary earned through the effective date of Evans’s termination, (2) accrued, unused annual leave, and (3) vested employee benefits under the terms and conditions of the governing plan documents and policies. In the event of termination without cause under this Section, Evans’ obligations under Sections 8 and 9 shall continue under the terms and conditions of those Sections.

c.  Voluntary Termination.  Evans may voluntarily terminate his employment under this Agreement at any time upon sixty (60) days’ prior written notice to Chugach’s Board of Directors, whereupon Chugach’s employment of Evans shall terminate at the end of the sixty (60) day notice period.  In the event of Evans’ voluntary termination of employment, he shall not be entitled to receive any compensation or benefits hereunder other than (1) his Salary accrued through the effective date of such termination, (2) accrued, unused annual leave, and (3) vested employee benefits under the terms and conditions of the governing plan documents and policies.  In the event of voluntary termination under this Section, Evans’ obligations under Sections 8 and 9 shall continue under the terms and conditions of this Agreement.

d.  Disability.  Chugach may terminate Evans’ employment after having established Evans’ disability, subject to applicable state and/or federal law.  For purposes of this Agreement, “Disability” means a physical or mental disability which impairs Evans’ ability to substantially perform his duties under this Agreement and which results in Evans becoming eligible for long-term disability benefits under Chugach’s long-term disability plan (or, if Chugach has no such plan in effect, which impairs Evans’ ability to substantially perform his duties under this Agreement for a period of 180 consecutive days).  Evans shall be entitled to the compensation and benefits under the terms and conditions of the governing plan documents or policies provided for under this Agreement for (i) any period during the term of this Agreement and prior to the establishment of Evans’ Disability during which Evans is unable to work due to a physical or mental disability, or (ii) any period of Disability which is prior to Evans’ termination of employment pursuant to this Section.  In the event of termination due to disability under this Section, Evans’ obligations under Sections 8 and 9 shall continue under the terms and conditions of those Sections.

e.  Death.  This Agreement shall automatically terminate the day after Evans’ death if it has not already terminated prior to that date.

f.  Miscellaneous.  In the event of any termination or attempted termination hereof:  (i) if multiple events, occurrences or circumstances are asserted as bases for such termination or attempted termination, the event, occurrence or circumstance that is earliest in time, and any termination or attempted termination found to be proper hereunder based thereon, shall take precedence over the others; (ii) no termination of this Agreement shall relieve or release either party from liability hereunder based on any breach of the terms hereof by such party occurring prior to the termination date; and (iii) the terms of this Agreement relevant to performance or satisfaction of any obligation hereunder expressly remaining to be performed or satisfied in whole or in part at the termination date shall continue in force until such full performance or satisfaction has been accomplished and otherwise neither party hereto shall have any other or further remaining obligations to the other party hereunder.

  

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g.  No Duty of Mitigation.  In the event of any termination of Evans’ employment under subsection 10(b), Evans shall be under no obligation to seek other employment and shall be entitled to all payments or benefits required to be made or provided to Evans hereunder, without any duty of mitigation of damages and regardless of any other employment obtained by Evans.

11.  Consulting Agreement.  If Evans did not engage in conduct that could give rise to a termination for cause under Section 10(a) and is either terminated from Chugach without Cause under Section 10(b) or resigns under Section 10(c), then Chugach will consider whether to enter into a consulting agreement with Evans for a period of time after his separation of employment.  Any consulting arrangement would be subject to mutual agreement of the parties and the then-current CEO of Chugach (or the individual who will become CEO upon Evans’s separation of employment). In addition, as a condition of Chugach entering into any consulting agreement with Evans and receiving consideration under that agreement, Evans shall: (a) be required to satisfy parts (i) and (ii) of the Consideration Requirements after his last day of employment with Chugach; (b) be required to satisfy parts (i) and (ii) of the Consideration Requirements again after his last day of service to Chugach as an independent contractor; and (c) not be entitled to the Severance under Section 10(b) upon termination of employment from Chugach or at any other time.

12.  Injunctive Relief.  It is agreed that the services of Evans are unique and that any breach or threatened breach by Evans of any provision of this Agreement cannot be remedied solely by damages.  Accordingly, in the event of a breach by Evans of his obligations under this Agreement, Chugach shall be entitled to seek and obtain interim restraints and permanent injunctive relief, restraining Evans and any business, firm, partnership, individual, corporation or entity participating in such breach or attempted breach.  Nothing herein, however, shall be construed as prohibiting either party from seeking injunctive relief to require resolution of disputes or controversies arising out of or relating to this Agreement.

13.  Indemnification.

a.  Chugach shall indemnify Evans (as a “protected person”) to the fullest extent permitted by AS 10.25.145 (the terms of which are incorporated herein by this reference) against all costs, expenses, liabilities and losses (including, without limitation, attorneys’ fees, judgments, penalties and amounts paid in settlement) reasonably incurred by Evans in connection with any action, suit or proceeding, whether civil, criminal, administrative or investigative in which Evans is made, or is threatened to be made, a party to or a witness in such action, suit or proceeding by reason of the fact that he is or was an officer or agent of Chugach or of any of Chugach’s controlled affiliates or is or was serving as an officer, trustee, agent or fiduciary of any other entity at the request of Chugach (a “Proceeding”).

  

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b.  Chugach shall advance to Evans all reasonable costs and expenses incurred by him in connection with a Proceeding within twenty (20) days after receipt by Chugach of a written request for such advance, accompanied by an itemized list of the actual or anticipated costs and expenses and Evans’ written undertaking to repay to Chugach on demand the amount of such advance if it shall ultimately be determined that Evans is not entitled to be indemnified against such costs and expenses.  Evans shall periodically account to Chugach for all such costs and expenses incurred by Evans in connection with his defense of the Proceeding.

c.  The indemnification provided to Evans hereunder is in addition to, and not in lieu of, any additional indemnification to which he may be entitled pursuant to Chugach’s Certificate of Incorporation or Bylaws, any insurance maintained by Chugach from time to time providing coverage to Evans and other officers and directors of Chugach, or any separate written agreement with Evans.  The provisions of this Section 13 shall survive any termination of this Agreement.

14.  Amendment and Modification.  This Agreement contains the entire agreement between the parties with respect to the subject matter hereof, and supersedes any and all prior agreements, arrangements or understandings between the parties hereto with respect to the subject matter hereof, whether written or oral, including but not limited to the previous Employment Agreement (retroactive as of July 1, 2008). Notwithstanding the foregoing, nothing in this Agreement supersedes or restricts any of Evans’s existing obligations to Chugach to protect the confidentiality of information of Chugach and to assign intellectual property rights to it or otherwise protect its intellectual property and/or business interests, which remain in full force and effect. Subject to applicable law and upon the consent of Chugach’s Board of Directors, this Agreement may be amended, modified and supplemented by written agreement of Chugach and Evans with respect to any of the terms contained herein.

15.  Waiver of Compliance.  Any failure of either party to comply with any obligation, covenant, agreement or condition on its part contained herein may be expressly waived in writing by the other party, but such waiver or failure to insist upon strict compliance shall not operate as a waiver of, or estoppel with respect to, any subsequent or other failure.  Whenever this Agreement requires or permits consent by or on behalf of any party, such consent shall be given in writing.

16.  Notices.  All notices, requests, demands and other communications required or permitted hereunder shall be in writing and shall be deemed to have been duly given if delivered by hand, sent by registered or certified U.S. Mail, postage prepaid, commercial overnight courier service or transmitted by facsimile and shall be deemed served or delivered to the addressee at the address for such notice specified below when hand delivered, upon confirmation of sending when sent by fax, on the day after being sent when sent by overnight delivery, or five (5) days after having been mailed, certified or registered, with postage prepaid:

  

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If to Chugach

Chugach Electric Association, Inc.

P.O. Box 196300

Anchorage, Alaska 99519-6300

Facsimile: (907) 762-4888

Attn: Chairman of Board of Directors

	
If to Evans

Bradley W. Evans

Mailing:          P.O. Box 222483

                        Anchorage, Alaska 99522

Physical:        14741 Park Hills Circle

                        Anchorage, Alaska 99516

 

Or, in the case of either such party, to such substitute address as such party may designate from time to time for purposes of notices to be given to such party hereunder, which substitute address shall be designated as such in a written notice given to the other party addressed as aforesaid.

17.  Assignment.  This Agreement shall inure to the benefit of Evans and Chugach and be binding upon the successors and general assigns of Employer.  This Agreement shall not be assignable by either party except to the extent set forth in Section 21.

18.  Enforceability.  In the event it is determined that this Agreement is unenforceable in any respect, it is the mutual intent of the parties that it be construed to apply and be enforceable to the maximum extent permitted by applicable law.

19.  Applicable Law.  This Agreement is made under and shall be governed by and construed in accordance with the laws of the State of Alaska without regard to conflicts of laws principles thereof, and shall further be construed and enforced in accordance with the laws applicable to contracts executed, delivered and fully to be performed in the State of Alaska.

20.  Compliance with Section 409A.  The intent of Evans and Chugach is that all payments and benefits under this Agreement comply with or be exempt from Section 409A of the Internal Revenue Code of 1986, as amended (“Section 409A”), this Agreement be interpreted to be in compliance with Section 409A, and that such payments and benefits not be subject to any tax or interest under Section 409A.  In the event any term or provision of the Agreement would be prohibited by or inconsistent with the requirements of Section 409A, or cause any payments or benefits to be subject to tax or interest under Section 409A, such term or provision will be deemed reformed and modified to the minimum extent reasonably appropriate to conform with Section 409A.  In no event will Chugach or any of its employees or representatives have any liability to Evans in the event that any payment or benefit provided under this Agreement becomes subject to tax or interest under Section 409A.

  

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21. Beneficiaries: Executive’s Representative.  Evans shall be entitled to select (and to change, from time to time, except to the extent prohibited under any applicable law) a beneficiary or beneficiaries to receive any payments, distributions or benefits to be made or distributed hereunder upon or following Evans’ death.  Any such designation shall be made by written notice to Chugach.  In the event of Evans’ death or of a judicial determination of Evans’ incompetence, references in this Agreement to Evans shall be deemed, as appropriate, to refer to his designated beneficiary, to his estate or to his executor or personal representative (“Evans’ Representative”) solely for the purpose of providing a clear mechanism for the exercise of Evans’ rights hereunder in the case of Evans’ death or disability.

22. Jurisdiction.  Any litigation arising out of or involving this Agreement will proceed only in the Third Judicial District, State of Alaska, and venue will be permissible only in Anchorage, Alaska.

23. Acknowledgement of Non-Reliance.  Evans acknowledges and agrees that he has executed this Agreement freely and voluntarily, and that no representation or promise not expressly contained in the Agreement has been made by Chugach or the Board of Directors.

24.  Informed Agreement.  All the terms and conditions in this Agreement have been reflected upon without haste.  The undersigned parties acknowledge that neither is at a disadvantage, that each has been advised to seek representation of counsel in the negotiation and signing of this Agreement, that each has had the opportunity to seek legal representation, and that each is signing this Agreement without coercion.

  

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IN WITNESS WHEREOF, the parties have executed this Agreement, effective July 1, 2011.

	 	CHUGACH ELECTRIC ASSOCIATION, INC.
	 	 	 
	  	
/s/ Janet Reiser

	  	  	  
	  	
Name:

	
Janet Reiser

	  	  	  
	  	
Title:

	
Chair, Chugach Board of Directors

	  	  	  
	  	
BRADLEY W. EVANS

	  	  	  
	  	
/s/ Bradley W. Evans

	  	
Bradley W. Evans

 

 

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Exhibit 10.1

 

 

ASSET PURCHASE AGREEMENT

Asset Purchase Agreement (the “Agreement”) is made effective as of June 14, 2011, by and among Aurora Gold Corp., a Delaware corporation (the “Seller”), and DEVTEC Management Limited, a BVI corporation (the “Buyer”) (each a “Party” and collectively, the “Parties”).

R E C I T A L S

WHEREAS, the Seller owns all of the issued and outstanding limited liability membership interests (the “Membership Interests”) in AGC Resources LLC, a Colorado limited liability company and a wholly owned subsidiary of Seller (the “Subsidiary”) as more fully set forth in Schedule A hereto; and

WHEREAS, Seller, through Subsidiary, conducts certain resource exploration and development activities on lands located in the State of Colorado; and

WHEREAS, the Seller and the Subsidiary are parties to an Asset Purchase Agreement dated June 1, 2010, with Global Minerals Ltd., a corporation incorporated under the laws of British Columbia, Canada, formerly known as “Consolidated Global Minerals Ltd.” (“Global”), Mount Royale Ventures, LLC, a Colorado limited liability company (“Mount Royale”) and Golden Rex Mining Company, a Colorado limited liability company (“Golden Rex”), pursuant to which Subsidiary purchased the Colorado Mining Assets (as defined below); and

WHEREAS, Buyer wishes to purchase the Membership Interests from the Seller, and the Seller wishes to sell the Membership Interests to the Buyer, subject to and on the terms and conditions set forth in this Agreement;

NOW, THEREFORE, in consideration of the representations, warranties and covenants contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

1.            Definitions. In addition to the definitions appearing elsewhere in this Agreement, the following capitalized words and phrases have the meaning provided.

(a)          “Agreement” has the meaning set forth in the preface above.

(b)          “Business Day” means a day other than a Saturday, Sunday or national holiday on which commercial banks in the State of New York are open for the transaction of commercial banking business. In the event a payment date falls on a day other than a Business Day, payment shall be made on the next following Business Day.

(c)          “Buyer” has the meaning set forth in the preface above.

(d)          “Closing” has the meaning set forth in Section 2(e) below.

  

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(e)          “Closing Date” has the meaning set forth in Section 2(e) below.

(f)           “Colorado Mining Assets” means the assets acquired by the Subsidiary pursuant to the Asset Purchase Agreement dated June 1, 2010, as more fully set forth in Schedule 1(i) to this Agreement, with Global Mount Royale and Golden Rex, but not including the “Excluded Assets” set forth in Schedule 1(ii).

(g)          “Confidential Information” has the meaning set forth in Section 5(e) below.

(h)          “Dollars,” or “$” as used in this Agreement shall mean the lawful currency of the United States of America.

(i)           “Excluded Assets” means the assets more fully described in Schedule 1(ii) of this Agreement.

(j)           “Global” has the meaning set forth in the Recitals above.

(k)          “Joint Venture” means the Joint Venture created pursuant to a Joint Venture Agreement dated December 18, 2002 (the “Joint Venture Agreement”), by and among Mi Vida Enterprises, Gold Mines, Inc., Gold Reef Mining Company and Southern Cross Prospecting Company (collectively, the “Property Owners”) and Global and pursuant to the letter agreement dated November 10, 2009, and as extended by certain extension agreements dated February 28, 2010, April 12, 2010 and April 30, 2010, pursuant to which Seller and Subsidiary agreed to jointly participate in the Joint Venture, and as amended by the Asset Purchase Agreement entered into as of June 1, 2010, between the Global, Mountain Royale, Golden Rex, Seller and Subsidiary, to develop certain patented and unpatented mining claims located in Boulder County, State of Colorado, known as the Gold Hill Project and any successor in interest thereto or any other entity or under any amended or new agreement related to the Colorado Mining Assets.

(l)           “Material Adverse Effect” means any effect or change that would be materially adverse to the business of the applicable Party and its Subsidiaries, taken as a whole, or to the ability of any Party to consummate timely the transactions contemplated hereby; provided that none of the following shall be deemed to constitute, and none of the following shall be taken into account in determining whether there has been, a Material Adverse Effect: (a) any adverse change, event, development, or effect arising from or relating to (i) general business or economic conditions, including such conditions related to the business of the applicable Party and its Subsidiaries, (ii) national or international political or social conditions, including the engagement by the country of its incorporation or formation, whether or not pursuant to the declaration of a national emergency or war, or the occurrence of any military or terrorist attack upon such country, or any of its territories, possessions, or diplomatic or consular offices or upon any military installation, equipment or personnel of such country, (iii) financial, banking, or securities markets (including any disruption thereof and any decline in the price of any security or any market index), (iv) changes in accounting principles, (v) changes in laws, rules, regulations, orders, or other binding directives issued by any governmental entity, or (vi) the taking of any action contemplated by this Agreement and the other agreements contemplated hereby, (b) any existing event, occurrence, or circumstance with respect to which the other Party has knowledge as of the date hereof, and (c) any adverse change in or effect on the business of the applicable Party and its Subsidiaries that is cured by such party before the earlier of (i) the Closing Date and (ii) the date on which this Agreement is terminated pursuant to Section 10 hereof.

  

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(m)         “Membership Interests” has the meaning set forth in the Recitals above and in Schedule A to this Agreement.

(n)          “Ordinary Course of Business” means the ordinary course of business consistent with past custom and practice (including with respect to quantity and frequency).

(o)          “Outside Closing Date” has the meaning set forth in Section 2(e) below.

(p)          “Party” or “Parties” has the meaning set forth in the preface above.

(q)          “Person” means an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization, or a governmental entity (or any department, agency, or political subdivision thereof).

(r)           “Purchase Price” has the meaning set forth in Section 2(b) below.

(s)          “Representatives” has the meaning set forth in Section 5(e) below.

(t)           “Royalty” has the meaning set forth in Section 2(c) below.

(u)          “Seller” has the meaning set forth in the preface above.

(v)          “Security Interests” means any mortgage, pledge, lien, encumbrance, charge, or other security interest, other than (a) mechanic’s, materialmen’s, and similar liens, (b) liens for taxes not yet due and payable, (c) purchase money liens and liens securing rental payments under capital lease arrangements, and (d) other liens arising in the Ordinary Course of Business and not incurred in connection with the borrowing of money.

(w)         “Subsidiary Assets” means, all assets owned or leased by Subsidiary as more fully set forth in Schedule 1(i), but does not include the “Excluded Assets” as more fully set forth in Schedule 1(ii) of this Agreement.

2.            Transaction.

(a)           Purchase and Sale of Membership Interests. On and subject to the terms and conditions set forth in this Agreement, the Seller agrees to sell to Buyer and Buyer agrees to purchase from the Seller, the Membership Interests set forth on Schedule A to this Agreement, for the consideration specified below in this Section 2 (b) and (c).

  

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(b)          Purchase Price. The purchase price for the Membership Interests shall be Two Million Dollars ($2,000,000) (the “Purchase Price”), payable by bank check or bank wire, as follows:

 

  (i)           One Million Dollars ($1,000,000) is payable within ten Business Days from the day on which a cumulative total of 1,000 ounces of gold and/or silver has been produced by the Joint Venture.

  (ii)          One Million Dollars ($1,000,000) is payable on the six month anniversary of the payment of the first One Million Dollars ($1,000,000) set forth in Section 2(b)(i) above.

(c)          Royalty.

As additional consideration for the consummation of the transactions contemplated by this Agreement:

  (i)           Buyer shall pay Seller a Royalty equal to 5% of the value of the gold and/or silver produced by the Joint Venture.

  (ii)          The value of the gold and/or silver shall be based upon the London Metals Exchange equivalent price of the produced ounces of gold and/or silver at the time the Royalty payment is due.

  (iii)         The Royalty shall be paid quarterly and shall be paid in full within twenty (20) days from the end of each fiscal quarter. The Seller shall have the right, within ninety (90) days after the publication of the annual audited financial statements of the Buyer for each fiscal year during which gold and/or silver is mined, to request an audit of the Royalty calculation by the Buyer’s public auditors, after which time period the Buyer’s calculations shall be deemed to be correct. The cost of such audit shall be paid by the Seller unless the audit reveals that the Royalty payment for the fiscal year in question was more than Ten Percent (10%) less than that calculated as being due by the auditor.

  (iv)         The Royalty payment shall begin upon production of gold and/silver and continue to be made so long as gold and/or silver is produced by the Joint Venture and shall not be subject to any minimum or maximum amount.

(d)         Payment Non-Refundable. Buyer hereby acknowledges that each portion of the Purchase Price and Royalty becomes non-refundable as of the date paid.

(e)          The Closing. The closing of the transactions contemplated by this Agreement (the “Closing”) shall take place at the offices of Sierchio & Company, LLP commencing at 12:00 p.m., eastern daylight time (or such other place and time as the Parties may mutually determine), on the first business day following the satisfaction or waiver of all conditions to the obligations of the Parties to consummate the transactions contemplated hereby (other than conditions with respect to actions the respective Parties will take at the Closing itself) or such other date as the Parties may mutually determine (the “Closing Date”).

  

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(f)           Deliveries at the Closing. At the Closing, (i) the Seller will deliver to the Buyer the various certificates, instruments, and documents referred to in Section 6(a) below; (ii) Buyer will deliver to the Seller the various certificates, instruments, and documents referred to in Section 6(b) below; and (iii) the Seller will execute, acknowledge (if appropriate), and deliver to the Buyer an assignment of the Membership Interests.

3.           Representations and Warranties of the Seller.

(a)          Representations and Warranties of Seller. The Seller represents and warrants to the Buyer that the statements contained in this Section 3(a) are correct and complete as of the date of this Agreement and will be correct and complete as of the Closing Date (as though made then and as though the Closing Date were substituted for the date of this Agreement throughout this Section 3(a)).

  (i)           Organization of the Seller. The Seller is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware.

  (ii)          Authorization of Transaction. The Seller has full power and authority (including full corporate power and authority) to execute and deliver this Agreement and to perform its obligations hereunder. This Agreement constitutes the valid and legally binding obligation of the Seller, enforceable in accordance with its terms and conditions.

  (iii)         Non-contravention. Neither the execution and the delivery of this Agreement, nor the consummation of the transactions contemplated hereby (including the assignments and assumptions referred to in Section 2 above), will (A) violate any constitution, statute, regulation, rule, injunction, judgment, order, decree, ruling, charge, or other restriction of any government, governmental agency, or court to which the Seller is subject or any provision of the charter or bylaws of the Seller or (B) conflict with, result in a breach of, constitute a default under, result in the acceleration of, create in any party the right to accelerate, terminate, modify, or cancel, or require any notice under any agreement, contract, lease, license, instrument, or other arrangement to which the Seller is a party or by which it is bound or to which any of its assets is subject (or result in the imposition of any Security Interests upon any of its assets), except where the violation, conflict, breach, default, acceleration, termination, modification, cancellation, failure to give notice, or Security Interests would not have a Material Adverse Effect on the financial condition of the Seller or on the ability of the Parties to consummate the transactions contemplated by this Agreement. The Seller does not need to give any notice to, make any filing with, or obtain any authorization, consent, or approval of any government or governmental agency in order for the Parties to consummate the transactions contemplated by this Agreement (including the assignments and assumptions referred to in Section 2 above), except where the failure to give notice, to file, or to obtain any authorization, consent, or approval would not have a Material Adverse Effect.

(b)         Representations and Warranties of the Seller Concerning Subsidiary. The Seller represents and warrants to the Buyer that the statements contained in this Section 3(b) are correct and complete as of the date of this Agreement and will be correct and complete as of the Closing Date (as though made then and as though the Closing Date were substituted for the date of this Agreement throughout this Section 3(b)).

  

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  (i)           Organization of the Subsidiary. The Subsidiary is a limited liability partnership duly organized, validly existing and in good standing under the laws of Colorado.

  (ii)          Authorization of Transaction. The Subsidiary has full power and authority (including full corporate power and authority) to perform its obligations hereunder. This Agreement constitutes the valid and legally binding obligation of the Subsidiary, enforceable in accordance with its terms and conditions.

  (iii)         Non-contravention. Except as set forth in Schedule 3(b)(v) to this Agreement, neither the execution and the delivery of this Agreement, nor the consummation of the transactions contemplated hereby (including the assignments and assumptions referred to in Section 2 above), will (A) violate any constitution, statute, regulation, rule, injunction, judgment, order, decree, ruling, charge, or other restriction of any government, governmental agency, or court to which the Subsidiary is subject or any provision of the charter or partnership agreement of the Subsidiary or (B) conflict with, result in a breach of, constitute a default under, result in the acceleration of, create in any party the right to accelerate, terminate, modify, or cancel, or require any notice under any agreement, contract, lease, license, instrument, or other arrangement to which the Subsidiary is a party or by which it is bound or to which any of its assets is subject (or result in the imposition of any Security Interests upon any of its assets), except where the violation, conflict, breach, default, acceleration, termination, modification, cancellation, failure to give notice, or Security Interests would not have a material adverse effect on the financial condition of the Subsidiary or on the ability of the Parties to consummate the transactions contemplated by this Agreement. The Subsidiary will obtain any authorization, consent, approval, or waiver from any government or governmental agency in order for the Parties to consummate the transactions contemplated by this Agreement (including the assignments and assumptions referred to in Section 2 above), except where the failure to give notice, to file, or to obtain any authorization, consent, or approval would not have a Material Adverse Effect.

  (iv)         Capitalization. All of the Membership Interests of the Subsidiary is owned by the Seller. The Membership Interests is free and clear of any liens or encumbrances, and are not subject to preemptive rights or rights of first refusal created by statute, its charter or partnership agreement. There are no outstanding or authorized options, warrants, purchase rights, subscription rights, conversion rights, exchange rights, or other contracts or commitments that could require the Subsidiary to issue, sell, or otherwise cause to become outstanding any of its equity interests.

  (v)          Litigation. Other than as set forth in Schedule 3(b)(v) to this Agreement (collectively, the “Litigation”), the Subsidiary is not currently (i) subject to any outstanding injunction, judgment, order, decree, ruling, or charge concerning its assets; or (ii) a party to any action, suit, proceeding, hearing, or investigation of, in, or before any court or quasi-judicial or administrative agency of any federal, state, local, or foreign jurisdiction concerning its assets. Buyer acknowledges that the final disposition of the Litigation, or any portion thereof, may have a Material Adverse Effect on the business of the Subsidiary and/or its rights or title to any assets currently owned or leased by Subsidiary, including, but not limited to, those assets more fully described on Schedules 1(i) to this Agreement and may result in the loss of the Subsidiary’s entire rights therein and title thereto.

  

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  (vi)         Contracts. Except as set forth in Schedule 3(b)(v), any written contract and oral agreement of the Subsidiary which will involve consideration in excess of $100,000 and any agreement under which the consequences of a default or termination could have a Material Adverse Effect (including but not limited to mineral rights agreements, leases and licenses to which the Subsidiary is a party): (i) the agreement is legal, valid, binding, enforceable, and in full force and effect; (ii) the agreement will continue to be legal, valid, binding, enforceable, and in full force and effect on identical terms following the consummation of the transactions contemplated hereby; (iii) no party is in breach or default, and no event has occurred that with notice or lapse of time would constitute a breach or default, or permit termination, modification, or acceleration, under the agreement; and (iv) no party has repudiated any provision of the agreement.

  (vii)        Disclaimer of other Representations and Warranties. Except as expressly set forth in this Section 3(b), the Seller makes no representation or warranty, express or implied, at law or in equity, in respect of any of the Subsidiary’s assets, liabilities or operations including, without limitation, with respect to merchantability or fitness for any particular purpose, and any such other representations or warranties are hereby expressly disclaimed. The Buyer hereby acknowledges and agrees that, except to the extent specifically set forth in this Section 3, the Buyer is purchasing the Membership Interests on an “as-is, where-is” basis.

4.           Representations, Warranties and Acknowledgements of the Buyer. The Buyer represents and warrants to the Seller that the statements contained in this Section 4 are correct and complete as of the date of this Agreement and will be correct and complete as of the Closing Date (as though made then and as though the Closing Date were substituted for the date of this Agreement throughout this Section 4).

(a)          Organization of the Buyer. The Buyer is a BVI corporation duly organized, validly existing, and in good standing under the laws of the British Virgin Islands. True and complete copies of the Articles of Incorporation, by-laws (or their equivalent), list of directors and beneficial owners of the Buyer will be delivered to the Seller and valid as of the Closing Date.

(b)          Authorization of Transaction. The Buyer has full power and authority (including full limited liability company power and authority) to execute and deliver this Agreement and to perform its obligations hereunder. This Agreement constitutes the valid and legally binding obligation of the Buyer, enforceable in accordance with its terms and conditions. The execution and delivery of this Agreement by the Buyer and the consummation by the Buyer of the transactions contemplated by this Agreement have been duly authorized by the Board of Directors of the Buyer and no other corporate proceedings on the part of the Buyer are necessary to authorize this Agreement.

  

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(c)          Non-contravention. Neither the execution and the delivery of this Agreement, nor the consummation of the transactions contemplated hereby (including the assignments and assumptions referred to in Section 2 above), will (i) violate any constitution, statute, regulation, rule, injunction, judgment, order, decree, ruling, charge, or other restriction of any government, governmental agency, or court to which the Buyer is subject or any provision of its articles of organization or operating agreement (or similar instruments) or (ii) conflict with, result in a breach of, constitute a default under, result in the acceleration of, create in any party the right to accelerate, terminate, modify, or cancel, or require any notice under any agreement, contract, lease, license, instrument, or other arrangement to which the Buyer is a party or by which it is bound or to which any of its assets is subject. The Buyer does not need to give any notice to, make any filing with, or obtain any authorization, consent, or approval of any government or governmental agency in order for the Parties to consummate the transactions contemplated by this Agreement (including the assignments and assumptions referred to in Section 2 above).

(d)          Investment. The Buyer (i) understands that the Membership Interests have not been, and will not be, registered under the Securities Act, or under any state securities laws, and are being offered and sold in reliance upon federal and state exemptions for transactions not involving any public offering, (ii) is acquiring the Membership Interests solely for its own account for investment purposes, and not with a view to the distribution thereof, (iii) is a sophisticated investor with knowledge and experience in business and financial matters, (iv) has received certain information concerning the Subsidiary and has had the opportunity to obtain additional information as desired in order to evaluate the merits and the risks inherent in holding the Membership Interests, (v) is able to bear the economic risk and lack of liquidity inherent in holding the Membership Interests, and (vi) is an Accredited Investor, as defined by the rules and regulations promulgated by the Securities and Exchange Commission.

(e)          Loss of Rights and Title to the Subsidiary’s Assets. Buyer acknowledges that the final disposition of the Litigation, or any portion thereof, may have a Material Adverse Effect on the business of the Subsidiary and/or its rights or title to any assets currently owned or leased by Subsidiary. Without limiting the foregoing, the final disposition of the Litigation, or any portion thereof, may specifically affect:

  (i)           The Validity of the Joint Venture. Buyer acknowledges that the Joint Venture and the Joint Venture Agreement may no longer be in full force and effect and is, in part, the subject of the Litigation.

  (ii)          Title to the Mill. Buyer acknowledges that Subsidiary’ title to the mill(s) located on the Oscar Lode mining claim and/or Good Enough Lode mining claim, as more fully set forth in Schedule 1(i), may no longer be valid and is, in part, the subject of the Litigation.

5.           Pre-Closing Covenants. The Parties agree as follows with respect to the period between the execution of this Agreement and the Closing.

(a)          General. Each of the Parties will use its reasonable best efforts to take all action and to do all things necessary in order to consummate and make effective the transactions contemplated by this Agreement (including satisfaction, but not waiver, of the closing conditions set forth in Section 6 below).

  

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(b)         Notices and Consents. Each of the Parties will give any notices to, make any filings with, and use its reasonable best efforts to obtain any authorizations, consents, and approvals of governments and governmental agencies in connection with the matters referred to in Sections 3(a)(iii) and 3(b)(iii) and Section 4(c) above.

(c)         Operation of Business. The Subsidiary will not, and the Seller will not cause or permit the Subsidiary to, engage in any practice, take any action, or enter into any transaction outside the Ordinary Course of Business without consent of the Buyer thereof.

(d)         Full Access. The Seller will permit representatives of the Buyer to have full access at all reasonable times, and in a manner so as not to interfere with the normal business operations of the Subsidiary and to all premises, properties, personnel, books, records (including tax records), contracts, and documents of or pertaining to the Subsidiary.

(e)         Confidentiality. Each Party will treat and hold as confidential, and not use or disclose, all of the information it receives from the other Party in the course of the reviews contemplated by Section 5(d), including, but not limited to, all information concerning the Subsidiary, the negotiation or existence and terms of this Agreement and the business affairs of the other Party (“Confidential Information”), provided, however, that the foregoing obligation of confidentiality shall not apply to (i) Confidential Information which is now or hereafter enters the public domain without a breach of this Agreement; (ii) Confidential Information known to the recipient Party prior to the time of disclosure by the disclosing Party or independently acquired or developed by employees or agents of the recipient Party (as shown by written records) without access to the Confidential Information and without violating any provisions of this Agreement; (iii) Confidential Information disclosed in good faith to the recipient Party by a third party legally entitled to disclose the same; and (iv) disclosures as may be necessary, in the opinion of the recipient Party’s outside legal counsel, for the recipient Party not to be in violation or default under any applicable law or order; provided, that the recipient Party shall provide the disclosing Party with prompt prior written notice of such requirement so that the disclosing Party may seek a protective order or other appropriate remedy and/or waive compliance with the terms of this Agreement. Notwithstanding the preceding, a recipient Party may disclose the Confidential Information or portions thereof to those of its directors, officers, employees, contractors, agents and representatives (the persons to whom such disclosure is permissible being collectively called “Representatives”) who absolutely need to know such information for the purpose of evaluating the transactions contemplated by this Agreement (it being understood that those Representatives must be subject to confidentiality agreements with the disclosing Party substantially similar to this Agreement). Each Party agrees to be responsible for any breach of this Agreement by its Representatives.

(f)          Notice of Developments. Each Party will give prompt written notice to the other Party of any development having a Material Adverse Affect or otherwise causing a breach of any of its own representations, warranties and acknowledgements in Section 3 and Section 4 above, as the case may be.

  

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6.              Conditions to Obligation to Close.

(a)          Conditions to Obligation of the Buyer. The obligation of the Buyer to consummate the transactions to be performed by it in connection with the Closing is subject to satisfaction of the following conditions:

  (i)           the representations and warranties set forth in Section 3 above shall be true and correct in all material respects at and as of the Closing Date;

  (ii)          the Seller shall have performed and complied with all of their covenants hereunder in all material respects through the Closing;

  (iii)         there shall not be any injunction, judgment, order, decree, ruling, or charge in effect preventing consummation of any of the transactions contemplated by this Agreement;

  (iv)         the Seller shall have delivered to the Buyer certificates to the effect that each of the conditions specified above in Sections 6(a)(i)-(iii) are satisfied in all respects; and

  (v)          all actions to be taken by the Seller in connection with consummation of the transactions contemplated hereby and all certificates, opinions, instruments, and other documents required to effect the transactions contemplated hereby will be reasonably satisfactory in form and substance to the Buyer.

The Buyer may waive any condition specified in this Section 6(a) if it executes a writing so stating at or prior to the Closing.

(b)         Conditions to Obligation of the Seller. The obligation of the Seller to consummate the transactions to be performed by it in connection with the Closing is subject to satisfaction of the following conditions:

  (i)           the representations and warranties set forth in Section 4 above shall be true and correct in all material respects at and as of the Closing Date;

  (ii)          the Buyer shall have performed and complied with all of its covenants hereunder in all material respects through the Closing;

  (iii)         there shall not be any injunction, judgment, order, decree, ruling, or charge in effect preventing consummation of any of the transactions contemplated by this Agreement;

  (iv)         the Buyer shall have delivered to the Seller a certificate to the effect that each of the conditions specified above in Section 6(b)(i)-(iii) is satisfied in all respects; and

  (v)          all actions to be taken by the Buyer in connection with consummation of the transactions contemplated hereby and all certificates, opinions, instruments, and other documents required to effect the transactions contemplated hereby will be reasonably satisfactory in form and substance to the Seller.

  

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The Seller may waive any condition specified in this Section 6(b) if they execute a writing so stating at or prior to the Closing.

7.           Termination.

(a)          Termination of Agreement. Notwithstanding anything in this Agreement to the contrary, the Parties may terminate this Agreement as provided below:

  (i)           the Buyer and the Seller may terminate this Agreement by mutual written consent at any time prior to the Closing;

  (ii)          the Buyer may terminate this Agreement by giving written notice to the Seller at any time prior to the Closing in the event (A) the Seller has within the then previous ten (10) business days given the Buyer any notice pursuant to Section 5(f) above.

  (iii)         the Seller may terminate this Agreement by giving written notice to the the Buyer at any time prior to the Closing in the event (A) the Buyer has within the then previous ten (10) business days given the Seller any notice pursuant to Section 5(f) above.

  (iv)         the Buyer may terminate this Agreement by giving written notice to the Seller at any time prior to the Closing (A) in the event the Seller has breached any material representation, warranty, or covenant contained in this Agreement in any material respect, the Buyer has notified the Seller of the breach, and the breach has continued without cure for a period of five (5) days after the notice of breach or (B) if the Closing shall not have occurred on or before June 30, 2011 (the “Outside Closing Date”); and

  (iii)         the Seller may terminate this Agreement by giving written notice to the Buyer at any time prior to the Closing (A) in the event the Buyer has breached any material representation, warranty, or covenant contained in this Agreement in any material respect, the Seller has notified the Buyer of the breach, and the breach has continued without cure for a period of five (5) days after the notice of breach or (B) if the Closing shall not have occurred on or before the Outside Closing Date.

(b)         Effect of Termination. If any Party terminates this Agreement pursuant to Section 7(a) above, all rights and obligations of the Parties hereunder shall terminate without any liability of any Party to any other Party; provided, however, that the confidentiality provisions contained in Section 5(e) above shall survive termination.

8.           Miscellaneous.

(a)          Survival of Representations, Warranties and Covenants. All of the representations, warranties and covenants of the Parties contained in this Agreement shall survive the Closing and continue in full force and effect thereafter (subject to any applicable statutes of limitations of the State of New York); provided, however, that the representations, warranties and covenants contained herein shall expire as of the one year anniversary of the this Agreement.

  

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(b)         Press Releases and Public Announcements. The Parties acknowledge that the Seller may issue a press release, upon execution of this Agreement, summarizing the Agreement. Except as provided in the preceding sentence, no Party shall issue any press release or make any public announcement relating to the subject matter of this Agreement prior to the Closing without the prior written approval of the other Party; provided, however, the Parties agree that the Seller may make any public disclosure it believes in good faith is required by applicable law or any listing or trading agreement concerning its publicly-traded securities (in which case the Seller will use its reasonable best efforts to give the Buyer prior notice of the proposed disclosure).

(c)          No Third-Party Beneficiaries. This Agreement shall not confer any rights or remedies upon any Person other than the Parties and their respective successors and permitted assigns.

(d)         Entire Agreement. This Agreement (including the documents referred to herein) constitutes the entire agreement between the Parties and supersedes any prior understandings, agreements, or representations by or between the Parties, written or oral, to the extent they related in any way to the subject matter hereof.

(e)          Succession and Assignment. This Agreement shall be binding upon and inure to the benefit of the Parties named herein and their respective successors and permitted assigns. No Party may assign either this Agreement or any of its rights, interests, or obligations hereunder without the prior written approval of the other Party.

(f)          Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which together will constitute one and the same instrument.

(g)         Headings. The section headings contained in this Agreement are inserted for convenience only and shall not affect in any way the meaning or interpretation of this Agreement.

(h)         Notices. All notices, offers, acceptance and any other acts under this Agreement (except payment) shall be in writing, and shall be sufficiently given if delivered to the addressees in person, by Federal Express or similar receipted next business day delivery, or by facsimile delivery followed by overnight next business day delivery as follows:

If to the Seller:

Aurora Gold Corporation

Baarerstrasse 10, 1st Floor

6300, Zug, Switzerland

Attention: Lars Pearl

Facsimile: +41 44 711 0283

  

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With a copy (which copy shall not constitute notice) to:

Sierchio & Company, LLP

430 Park Avenue

Suite 702

New York, New York 10022

Attention: Joseph Sierchio, Esq.

Facsimile: (212)246-3039

If to the Buyer:

DEVTEC Management Limited

Akara Building, 24 De Castro Street, Wickhams, Cay I

Road Town Tortola, British Virgin Islands 634233

Devtec c/o FCI AG

Level 1, Baarerstrasse 10, CH-6300 Zug, Switzerland

Fax. +41 44 274 2818

or, to such other address as any of them, by notice to the other may designate from time to time. The transmission confirmation receipt from the sender’s facsimile machine shall be evidence of successful facsimile delivery. Time shall be counted to, or from, as the case may be, the date of delivery.

(i)           Assignment.  This Agreement may not be assigned by either Party without the prior written consent of the other Party hereto. Until the Purchase Price has been fully paid, the Buyer may assign its obligations hereunder and transfer and convey title to the Membership Interests and or the Subsidiary’s Assets to any party (the “Transferee”) provided that: (a) the Buyer obtains the prior written consent of the Seller to such transfer and conveyance; (b) the Transferee has a financial net worth at least equal to that of the Buyer; (c) the Buyer pays to the Seller as additional consideration hereunder an amount equal to fifty (50%) of the aggregate consideration received or to be received by the Buyer in connection therewith; and (d) that the Transferee agrees, in writing, to assume all of the Buyer’s obligations and liabilities under this Agreement, including but not limited to the payment of the Purchase Price and Royalty. Following the payment of the Purchase Price, the Buyer may assign its obligations hereunder and transfer and conveys title to the Membership Interests and or the Subsidiary’s Assets to any party provided that (1) the Buyer obtains the prior written consent of the Seller to such transfer and conveyance, and (2) the Transferee agrees, in writing, to assume all of the Buyer’s obligations and liabilities under this Agreement, including but not limited to the payment of the Royalty.

(j)           Arbitration.  Any controversy or claim arising out of or related to this Agreement, or any breach hereof, shall be settled by final and binding arbitration which shall be administered by the American Arbitration Association or another private arbitration/mediation firm mutually acceptable to the Parties; such arbitration shall be conducted in accordance with the commercial arbitration rules of the American Arbitration Association or such other commercial arbitration/mediation rules acceptable to the Parties and the private arbitration/mediation firm. Arbitration shall be before a single neutral arbitrator, who shall be an attorney who has practiced in the area of mining law for at least fifteen years or a retired judge of the district court or an appellate court level and shall be held in New York. Judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction thereof. Any demand for arbitration must be made prior to the date when the institution of legal or equitable proceedings based on the underlying claim would be barred by the applicable statute of limitations. The arbitrator shall award attorneys’ fees and costs to the prevailing party.

  

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  (k)           Amendments and Waivers. No amendment of any provision of this Agreement shall be valid unless the same shall be in writing and signed by the Buyer and the Seller. No waiver by any Party of any default, misrepresentation, or breach of warranty or covenant hereunder, whether intentional or not, shall be deemed to extend to any prior or subsequent default, misrepresentation, or breach of warranty or covenant hereunder or affect in any way any rights arising by virtue of any prior or subsequent such occurrence.

  (l)            Severability. Any term or provision of this Agreement that is invalid or unenforceable in any situation in any jurisdiction shall not affect the validity or enforceability of the remaining terms and provisions hereof or the validity or enforceability of the offending term or provision in any other situation or in any other jurisdiction.

  (m)          Expenses. Each of the Parties will bear its own costs and expenses (including legal fees and expenses) incurred in connection with this Agreement and the transactions contemplated hereby.

  (n)           Construction. The Parties have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any of the provisions of this Agreement. Any reference to any federal, state, local, or foreign statute or law shall be deemed also to refer to all rules and regulations promulgated thereunder, unless the context requires otherwise. The word “including” shall mean including without limitation.

  (o)           Incorporation of Schedules. The Schedules identified in this Agreement are incorporated herein by reference and made a part hereof.

  (p)           Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. This Agreement may be executed and delivered by facsimile.

  (q)           Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without giving effect to the principles of choice of laws thereof.

[Signature Page Follows]

  

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IN WITNESS WHEREOF, the Parties hereto have executed this Asset Purchase Agreement as of the date first above written.

	  	
Aurora Gold Corp.

	  	  	  
	  	  	  
	
By:

	  	  
	  	
Name:

	  
	  	
Title:

	
President

	  	
DEVTEC Management Limited

	  	  	  
	  	  	  
	  	  	  
	
By:

	  	  
	  	
Name:

	  
	  	
Title:

	  

  

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Schedule A

Membership Interests in AGC Resources LLC

Membership Interests means the 100 membership units in AGC Resources LLC, all owned by Aurora Gold Corporation; a copy of the Certificate, dated April 21, 2010, is attached hereto.

  

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Schedule 1(i)

Subsidiary Assets

Subsidiary Assets mean:

(a)           The Colorado Mining Assets acquired by the Subsidiary pursuant to the Asset Purchase Agreement dated June 1, 2010, attached hereto, with Global Minerals Ltd., a corporation incorporated under the laws of British Columbia, Canada, formerly known as “Consolidated Global Minerals Ltd.,” Mount Royale Ventures, LLC, a Colorado limited liability company and Golden Rex Mining Company, a Colorado limited liability company (the “June 1, 2010 Agreement”); and

(b)           The Assumed Liabilities;

  (i)            The Assumed Liabilities means all the obligations of Subsidiary related to the Colorado Mining Assets arising after Subsidiary purchased the Colorado Mining Assets pursuant to the June 1, 2010 Agreement; and

(c)           The Lease of Water Right between Subsidiary and Sweeney Mining and Milling Corporation entered into as of February 25, 2011, and attached hereto; and

(d)           Shall not include the Excluded Assets listed on Schedule 1(ii).

  

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ASSET PURCHASE AGREEMENT

THIS ASSET PURCHASE AGREEMENT (this “Agreement”) dated as of June 1, 2010 (the “Effective Date”), is among GLOBAL MINERALS LTD., a corporation incorporated under the laws of British Columbia, Canada, formerly known as “Consolidated Global Minerals Ltd.” (“Global”), MOUNT ROYALE VENTURES, LLC, a Colorado limited liability company (“Mount Royale”), GOLDEN REX MINING COMPANY, a Colorado limited liability company (“Golden Rex”), AURORA GOLD CORPORATION, a Delaware corporation (the “Parent”) and AGC RESOURCES LLC, a Colorado limited liability company and a wholly owned subsidiary of Parent (“Purchaser”; Purchaser and Parent hereinafter are referred to individually as a “Purchaser Party” and collectively as the “Purchaser Parties”).  Global, Golden Rex and Mount Royale hereinafter sometimes are referred to individually as a “Seller” and collectively as the “Sellers”.  The Sellers and the Purchaser Parties hereinafter sometimes are referred to individually as a “Party” and collectively, as the “Parties”.

RECITALS

A.            Mi Vida Enterprises, Gold Mines, Inc., Gold Reef Mining Company and Southern Cross Prospecting Company (collectively, the “Property Owners”) and Global are parties to an agreement (the “Joint Venture Agreement”) dated December 18, 2002, pursuant to which Global and the Property Owners have created a joint venture (the “Joint Venture”) to develop certain patented and unpatented mining claims located in Boulder County, State of Colorado, known as the Gold Hill Project (the “Gold Hill Project”). An exhibit to the Joint Venture agreement between the Property Owners and Global listing such claims is attached hereto as Exhibit A.

B.             Mount Royale is the owner of the mill, related improvements and other real and personal property interests, including certain water rights associated with the Gold Hill Project, more specifically described on Exhibit B-1 and B-2 (the “MRV Assets”).

 

C.             Golden Rex, an entity controlled by Richard T. Heard, owns an interest in the Black Cloud Mine Claim Group, also described on Exhibit C (the “Black Cloud Claims”).

 

D.             Global and Parent are parties to a letter agreement dated November 10, 2009 as extended by those certain extension agreements dated February 28, 2010, April 12, 2010 and April 30, 2010, respectively (collectively, the “November Agreement”) attached hereto as Exhibit D, pursuant to which Parent and Global agreed to jointly participate in the Joint  Venture.

 

E.             Pursuant to this Agreement, Global and the Purchaser Parties desire to (i) replace the November Agreement in its entirety and (ii) modify the concepts set forth therein.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the premises and of the respective representations, warranties, covenants, agreements, and conditions contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the Parties agree as follows:

 

	
1.

	
DEFINITIONS; RULES OF CONSTRUCTION

1.1.          Certain Definitions.  In this Agreement and any Exhibit or Schedule hereto, the following capitalized terms have the following meanings:

 

“Acceptable Funds” means a certified or cashier’s check or wire transfer.  The wire transfer instructions for Sellers are set forth on Schedule 1.1A.

“Acquired Assets” means, collectively, the Black Cloud Assets, the MRV Assets and the Joint Venture Assets.

  

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“Action” or “Actions” means any lawsuit, legal proceeding, administrative enforcement proceeding, charge, claim, complaint, compliance review, inspection not conducted in the Ordinary Course of Business, investigation or arbitration proceeding.

“Affiliate” means, as to any Person, any other Person that, directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with that Person.  For purposes of this definition, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”), as used with respect to any Person or group of Persons, means possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of the Person, whether through the ownership of voting securities or by contract.

“Affidavit of Non-Foreign Seller” means the Affidavits of Non-Foreign Seller in the form attached hereto as Exhibits E-1 and E-2.

“Agreement” has the meaning set forth in the preamble.

“Applicable Canadian Securities Laws” has the meaning set forth in Section 5.1.14(i).

“Assumed Liabilities” means all obligations of Sellers related to any of the Acquired Assets, which obligations arise after the Closing Date, but not otherwise.

 “Assumption Agreement” means the Assumption Agreement in the form attached hereto as Exhibit F.

“Authorized Officer” means the president, vice president, secretary and/or assistant secretary of a Party.

“Bill of Sale” means the Bill of Sale in the form attached hereto as Exhibit G.

“Black Cloud Assets” means all of the right, title and interest of Golden Rex in the Black Cloud Claims, together with all equipment, machinery, fixtures, rights of way, easements and other real and personal property associated therewith.

“Business Books and Records” means all files, paperwork and all other books, records or business files of any Seller pertaining to the Acquired Assets or the Assumed Liabilities, other than the Excluded Books and Records.

“Business Day” means a day other than a Saturday, Sunday or national holiday on which commercial banks in the State of Colorado are open for the transaction of commercial banking business.

“Cash Consideration” has the meaning set forth in Section 3.1.1.

“Closing” means the consummation of the transactions contemplated by this Agreement.

“Closing Date” has the meaning set forth in Section 4.1.

“Closing Date Payment” has the meaning set forth in Section 3.1.1.

“Code” means the Internal Revenue Code of 1986, as amended, and the rules and regulations promulgated thereunder.

“Damages” means all actual damages, losses, injuries, penalties, fines, forfeitures, assessments, claims, suits, proceedings, investigations, actions, demands, causes of action, judgments, awards, taxes, charges, costs and expenses of any nature (including court costs, reasonable legal, accountants’, consultants’ and experts’ fees, charges, Liabilities and other costs and expenses incident to any proceedings or investigation or the defense of any claim (whether or not litigation has commenced)), and specifically includes any losses or damages arising out of lost profits or reductions in value, but specifically excludes any consequential, special, incidental, indirect or punitive damages, except to the extent payable to a third-party.

  

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“Deposit” has the meaning set forth in Section 3.1.3.

“Disclosure Schedules” means the following disclosure schedules of each Seller as specified in this Agreement that are delivered to Purchaser at or prior to the date hereof:

	
  

	
 

	
Schedule 1.1A

	
Sellers Wire Transfer Instructions

	
  

	
 

	
Schedule 1.1B

	
Certain Excluded Assets

	
  

	
 

	
Schedule 1.1C

	
Excluded Claims

	
  

	
 

	
Schedule 1.1D

	
Litigation Liabilities Not Constituting Excluded Liabilities

	
  

	
 

	
Schedule 1.1E

	
Reclamation Bonds

	
  

	
 

	
Schedule 1.1F

	
Permits

	
  

	
 

	
Schedule 5.1.2

	
Authority and Approval

	
  

	
 

	
Schedule 5.1.3

	
No Conflict

	
  

	
 

	
Schedule 5.1.4

	
Governmental Approvals and Filing

	
  

	
 

	
Schedule 5.1.6

	
Liabilities

	
  

	
 

	
Schedule 5.1.7

	
Title

	
  

	
 

	
Schedule 5.1.8

	
Legal Proceedings

	
  

	
 

	
Schedule 5.1.9

	
Compliance with Laws

	
  

	
 

	
Schedule 5.1.10

	
Environmental Matters

	
  

	
 

	

Schedule 5.2.6(a)

	

Authorized/Outstanding Stock

	
  

	
 

	

Schedule 7.2

	

Notices

	
  

	
 

	
Schedule 7.17

	
List of Acceptable Arbitrators

 

“Documents” means, collectively, this Agreement and the Related Agreements.

“Due Diligence Period” has the meaning set forth in Section 4.1.

“Environmental Laws” includes all federal, state, municipal or local laws, regulations, ordinances, by-laws, guidelines, policies, rules, regulations, Orders of any Governmental Authority pertaining to health or the environment as may be interpreted by applicable court decisions or administrative orders, and the common law relating in whole or in part to the protection of health or the environment (including, without limitation,  ambient air, surface water, ground water, land surface, or subsurface strata) and includes those laws relating to the storage, generation, use, handling, manufacture, processing, transportation, import, export, treatment, release or disposal of any Hazardous Materials and any laws relating to asbestos or asbestos containing materials, including, without limitation, the Comprehensive Environmental Response Compensation and Liability Act of 1980, 42 U.S.C §9601 et seq., the Resource Conservation and Recovery Act of 1976, 42 U.S.C. § 6901 et seq., the Clean Air Act, 42 U.S.C. § 7401 et seq., the Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq., the Oil Pollution Act of 1990, 33 U.S.C. § 2701 et seq., the Toxic Substances and Control Act, 15 U.S.C. § 2601 et seq., and the Safe Drinking Water Act, 42 U.S.C. § 300f et seq., each as amended as of the date of this Agreement, and comparable state and local laws.

“Excluded Assets” means:

	  	
a)

	
all cash, certificates of deposit, bank deposits, cash equivalents, investment securities and checks or other payments received, owned or pledged by any Seller (including the Reclamation Bonds subject, however, to the provisions of Section 4.4.4 below, the Purchase Shares and the Cash Consideration) on or prior to the Closing Date;

 

	  	
b)

	
all of Sellers’ Tax Returns and records, any rights to Tax refunds or credits and any Income Tax deposits or prepayments;

 

	  	
c)

	
Sellers’ rights under this Agreement and the Registration Rights Agreement;

	  	
d)

	
the Excluded Books and Records;

 

  

20

  

 

	  	
e)

	
all of Sellers’ insurance policies and contracts and all rights thereunder (including, but not limited to, the right to make claims thereunder and to the proceeds thereof); and

	  	
f)

	
those assets listed on Schedule 1.1B.

“Excluded Books and Records” means all minute or other constituent record books pertaining to any Seller, all books and records relating solely to Income Taxes and any other books or records relating solely to the Excluded Assets or Excluded Liabilities.

“Excluded Claims” means those items and matters set forth on Schedule 1.1C.

“Excluded Liabilities” means all Liabilities of Sellers that are not Assumed Liabilities, including, but not limited to:

	  	
a)

	
All bank debts and borrowings;

	  	
b)

	
all Taxes of Sellers or any Affiliate of Sellers (including any sales Tax) for periods ending on or prior to the Closing Date (or allocable to periods ending on or prior to the Closing Date);

	  	
c)

	
all Liabilities arising from any litigation, arbitration or any proceeding with any Governmental Authority involving the Acquired Assets and Sellers, if and to the extent such litigation, arbitration or proceeding was filed or relates to a period or occurrence prior to the Closing Date other than as set forth on Schedule 1.1D; and

	  	
d)

	
all Liabilities related to the Excluded Assets.

 “GAAP” means generally accepted accounting principles in the United States, consistently applied.

 “Governmental Authority” means any government or political subdivision, whether federal, state or local, or any agency or instrumentality of any such government or political subdivision, or any federal, state or local court, tribunal or arbitrator.

“Hazardous Materials” means any   pollution,   pollutant, contaminant, asbestos and asbestos-containing materials,   solid waste,   hazardous waste, hazardous materials, hazardous substances,   extremely hazardous substances, hazardous chemicals, toxic substances, toxic chemicals, toxic pollutants,   petroleum,   radionuclides,   radioactive materials, and polychlorinated biphenyls, all as defined  under any Environmental Law. 

“Income Tax” means any tax based on, or measured by reference to, income whether computed on a separate, consolidated, unitary, combined or any other basis.  Such term also shall include any interest, penalties or additions to tax in respect to any Income Tax.

“Income Tax Returns” means all tax returns, statements, reports, forms, claims for refund, amendments or schedules relating to Income Taxes.

“Indemnified Party” has the meaning set forth in Section 6.3.

“Indemnifying Party” has the meaning set forth in Section 6.3.

“Joint Venture Agreement” has the meaning set forth in the preamble hereto.

“Joint Venture Assets” means all of the right, title and interest of Global in and to the Joint Venture.

“Laws” means any law, statute, code, ordinance, regulation, rule, writ, order, injunction, judgment, award, decree, official policy, official interpretation, official instruction or other requirement of any Governmental Authority.

  

21

  

 

“Liability” or “Liabilities” means any or all obligations (whether to make payments, to give notices or to perform or not perform any action), commitments, contingencies, penalties, costs, expenses and other liabilities of a Person (whether absolute, accrued, contingent, fixed or otherwise, determined or determinable, liquidated or unliquidated, and whether due or to become due), and including, without limitation, any Damages.

“Lien” means any charge, claim, community or other marital property interest, condition, equitable interest, option, pledge, security interest, mortgage, lien, lease, sublease,  right of way, easement, encroachment, servitude, right of first option, right of first refusal, or similar restriction or encumbrance of any kind, including any restriction on use, voting (in the case of any security or equity interest), transfer, receipt of income, or exercise of any other attribute of ownership.

“Material Adverse Effect” or “Material Adverse Change” means, when used in connection with a Party, any change, event, violation, inaccuracy or circumstance the effect of which is both material and adverse to (a) the property, business, operations, assets (tangible and intangible) or financial condition of such Party, or (b) the ability of such Party to perform its obligations under any Document to which it is a Party; provided, however, with respect to a Seller, clause (a) hereof shall read as follows: “the portion of the Acquired Assets owned by such Seller”.

“MRV Assets” means all of Mount Royale’s right, title and interest in the following:

	  	
1)

	
patented mining claims and water rights in the Left Hand Ditch Company described on Exhibit B-1 (collectively, the “MRV Property”);

	  	
2)

	
all Permits, licenses, servitudes, easements, right-of-way and other surface agreements used in connection with the ownership and operation of the MRV Property or the MRV Personal Property;

	  	
3)

	
all equipment, machinery, fixtures, and other real, personal and mixed property, operational and non-operational, known or unknown located on the MRV Property or on the other Acquired Assets or other properties covered by the Joint Venture Agreement, including, but limited to: feeders, crushers, ball mills, jigs, rag plants,  concentrate tables, thickeners, flotation machines, pumps, mining equipment, milling equipment, tanks, structures, materials and other items used in operation thereof, and all associated peripherals located on the MRV Property, including, without limitation, the inventory described on Exhibit B-2, except to the extent any of the foregoing constitute Excluded Assets (the “MRV Personal Property);

	  	
4)

	
all of the files, records, information and data, whether written or electronically stored, relating to the Acquired Assets, including, without limitation, (A) land and title records, (including abstracts of title, title opinions, and title curative documents); (B) contract files, (C) correspondence; (D) operations, environmental, production, and accounting records; (E) permitting and operational records; (F) geological and geophysical records, interpretations, data, maps and information, (G) engineering data, copies of all environmental reports and inspections, completed and pending, and any other environmental studies or reports related to the Acquired Assets or  other properties covered by the Joint Venture Agreement (the “MRV Records”).

“NI 45-106” has the meaning set forth in 5.1.14(ii).

“Order” means and includes any writ, judgment, decree, injunction, award, change, ruling or other order of any Governmental Authority.

“Ordinary Course of Business” means the ordinary course of business consistent with past custom and standard practice in the mining industry.

 

“Organizational Document” means (a) the articles or certificate of incorporation and the bylaws of a corporation; (b) operating agreement, limited liability company agreement, or similar document governing a limited liability company; (c) any charter or similar document adopted or filed in connection with the creation, formation, or organization of a Person; and (d) any amendment to any of the foregoing.

 

  

22

  

“Parent” has the meaning set forth in the preamble.

“Parent Registration Statement” means that certain Form S-1 Registration Statement filed with the SEC on February 5, 2010.

“Permits” means those permits, registrations and other licenses or documents issued by any Governmental Authority that may be required in order to operate any of the Acquired Assets.  A list of all Permits is set forth on Schedule 1.1E.

“Permitted Liens” means (a) Liens for Taxes not yet due and payable (other than Taxes arising out of the transactions contemplated by this Agreement) or for Taxes which are being contested in good faith, (b) Liens imposed by applicable Laws, such as materialmen’s, mechanics’, carriers’, workmen’s, repairmen’s and other similar Liens arising in the Ordinary Course of Business for amounts not yet due or which are being contested in good faith and (c) the Right of First Refusal.

“Person” means any natural person, corporation, general partnership, limited partnership, limited liability partnership, limited liability company, proprietorship, other business organization, trust, government, Governmental Authority, court or arbitrator, or any other entity whatsoever.

“Purchase Price” has the meaning set forth in Section 3.1.

“Purchaser” has the meaning set forth in the preamble.

“Purchaser Indemnified Parties” has the meaning set forth in Section 6.1.

“Purchaser Parties” has the meaning set forth in the preamble.

“Purchase Shares” has the meaning set forth in Section 3.1.2.

“Quitclaim Deed” means a deed pursuant to which title to the MRV Property or Black Cloud Assets will be transferred from the applicable Seller to Purchaser.  The forms of such Quitclaim Deeds are attached hereto as Exhibit H-1 and H-2.

“Reclamation Bonds” means the bonds pledged or posted by one or more Sellers in connection with the operation of the portion of the Acquired Assets owned by such Seller.  A description of all Reclamation Bonds is set forth on Schedule 1.1F.

“Registration Rights Agreement” means that certain Registration Rights Agreement in the form of Exhibit I.

“Related Agreements” means all agreements, certificates, instruments or other documents required to be executed and/or delivered pursuant to or in connection with this Agreement by any Person including, without limitation, each of the Transfer Documents and the Registration Rights Agreement.

“Right of First Refusal” has the meaning set forth on Schedule 5.1.7.

“SEC” means the Securities and Exchange Commission or any other Governmental Authority that may succeed to the obligations thereof.

“SEC Reports” means the periodic reports filed by the Parent with the SEC since December 31, 2009.

“Securities Act” has the meaning set forth in Section 5.2.6(f).

“Seller” and “Sellers” has the meaning set forth in the Recitals.

  

23

  

 

“Sellers Counsel” means Foster Graham Milstein & Calisher, LLP.

“Seller Indemnified Parties” has the meaning set forth in Section 6.2.

“Share Consideration” has the meaning set forth in Section 3.1.2.

“Tax” or “Taxes” means any federal, state, local or foreign taxes, charges, fees, imposts, levies or other such assessments imposed by law, including any income, gross receipts, gains, sales, use, employment, inventory, capital stock, license, occupation, withholding, payroll, employment, social security, unemployment, severance, franchise, profits, excise, property, transfer, capital, ad valorem, value added and estimated taxes, customs duties and any fees, assessments and charges in the nature of a tax and any interest, penalties and fines, additions to tax or additional amounts imposed by any Governmental Authority in respect of the foregoing.

“Tax Returns” means any returns, reports, schedules, forms, statements, and claims for refund required to be filed with any Governmental Authority with respect to Taxes, including any schedules or attachments hereto and any amendments thereof.

“Third Party Claim” has the meaning set forth in Section 6.4.1(a).

“Transfer Documents” means, collectively, the Bill of Sale, each Quitclaim Deed and the Assumption Agreement.

“Transfer Taxes” means all transfer, sales, use, reporting, recording, filing, conveyance and other similar fees, taxes and charges arising out of or in connection with the transfer of the Acquired Assets pursuant to this Agreement.

“TSX” means the Toronto Stock Exchange.

	  	
1.2.

	
Rules of Construction:

	  	
1.2.1.

	
Recitals, Exhibits, Schedules.  The recitals set forth above, together with all exhibits, schedules and other information attached to this Agreement, as well as any amendments to any of the foregoing, shall be deemed to be attached hereto and incorporated into this Agreement by this reference.  The following Exhibits and Schedules are attached to this Agreement:

	
  

	
 

	
Exhibit A

	
Exhibit A to the Joint Venture Agreement

	
  

	
 

	
Exhibit B-1

	
MRV Property

	
  

	
 

	
Exhibit B-2

	
MRV Inventory

	
  

	
 

	
Exhibit C

	
Black Cloud Claims

	
  

	
 

	
Exhibit D

	
November Agreement

	
  

	
 

	
Exhibit E-1

	
Affidavit of Non-Foreign Seller for Mount Royale

	
  

	
 

	
Exhibit E-2

	
Affidavit of Non-Foreign Seller for Golden Rex

	
  

	
 

	
Exhibit F

	
Assumption Agreement

	
  

	
 

	
Exhibit G

	
Bill of Sale

	
  

	
 

	
Exhibit H-1

	
Quitclaim Deed for Golden Rex

	
  

	
 

	
Exhibit H-2

	
Quitclaim Deed for Mount Royale

	
  

	
 

	
Exhibit I

	
Registration Rights Agreement

 

	
  

	
 

	
Schedule 1.1A

	
Sellers Wire Transfer Instructions

	
  

	
 

	
Schedule 1.1B

	
Certain Excluded Assets

	
  

	
 

	
Schedule 1.1C

	
Excluded Claims

	
  

	
 

	
Schedule 1.1D

	
Litigation Liabilities Not Constituting Excluded Liabilities

	
  

	
 

	
Schedule 1.1E

	
Reclamation Bonds

	
  

	
 

	
Schedule 1.1F

	
Permits

  

24

  

 

	
  

	
 

	
Schedule 5.1.2

	
Authority and Approval

	
  

	
 

	
Schedule 5.1.3

	
No Conflict

	
  

	
 

	
Schedule 5.1.4

	
Governmental Approvals and Filing

	
  

	
 

	
Schedule 5.1.6

	
Liabilities

	
  

	
 

	
Schedule 5.1.7

	
Title

	
  

	
 

	
Schedule 5.1.8

	
Legal Proceedings

	
  

	
 

	
Schedule 5.1.9

	
Compliance with Laws

	
  

	
 

	
Schedule 5.1.10

	
Environmental Matters

	 	
Schedule 5.2.6(a) 

	
Authorized/Outstanding Stock

	
  

	
 

	
Schedule 7.2

	
Notices

	
  

	
 

	
Schedule 7.17

	
List of Acceptable Arbitrators

 

	  	
1.2.2.

	
Statutory References.  All references to any federal, state or local governmental statute, rule, regulation or ordinance of any Governmental Authority shall be deemed to be a reference to such statute, rule, regulation or ordinance of such Governmental Authority as the same exists as of the date hereof, or as the same may be amended after such date.

	  	
1.2.3.

	
References.  All references in this Agreement to (a) singular terms shall be deemed to include the plural, (b) masculine terms shall be deemed to include the feminine, (c) “and” shall be deemed to include “and/or,” where applicable, and (d) “including” shall be deemed to be a reference to “including, without limitation,” where applicable.

 

	  	
1.2.4.

	
Consent; Discretion of Any Party.  Unless required otherwise in this Agreement, any consent of any Party (a) shall be (i) in writing and (ii) obtained not less than ten (10) Business Days prior to the action proposed and (b) may be granted or withheld, conditioned or delayed, in the sole discretion of such Party.

 

	  	
1.2.5.

	
Knowledge.  When any statement in this Agreement is made to the best of any Party’s “knowledge”, such statement shall be deemed to be made after (a) due inquiry to all Persons who reasonably could be expected to have any information with respect to the issue in question and (b) review by such Party of all material a prudent Person would deem relevant to the matter in question.

 

	  	
1.2.6.

	
GAAP.  All financial terms used in this Agreement and not otherwise defined herein shall be construed in accordance with GAAP.

 

	  	
1.2.7.

	
Periods of Time.  Unless indicated otherwise in this Agreement, all references to a (a) month or quarter shall be deemed to be a reference to a calendar month or quarter, as applicable, or (b) year shall be deemed to be a reference to a consecutive 365-day period beginning on the date in question and ending on the date which is 365 days thereafter.

	 	1.2.8.	
Payments – Non-Business Days; United States Dollars. Any payments due on any day which is not a Business Day shall be made on the immediately succeeding Business Day.  All references herein to “$” or “dollars” shall mean United States Dollars.

 

	
2.

	
PURCHASE AND SALE AND ASSUMPTION; TERMINATION OF NOVEMBER AGREEMENT

	  	
2.1.

	
Purchase and Sale of Acquired Assets.  Upon the terms and subject to the conditions of this Agreement, at the Closing:

	  	
2.1.1.

	
MRV Assets.  Mount Royale shall  sell, transfer, convey, assign, deliver and set over to Purchaser, and Purchaser will purchase and accept, all of the right, title and interest of Mount Royale in the MRV Assets pursuant to the applicable Quitclaim Deed and the Bill of Sale;

	  	
2.1.2.

	
Joint Venture Assets.  Global shall assign to Purchaser, and Purchaser will purchase and accept, all of Global’s right, title, benefit and interest in the Joint Venture Assets pursuant to the Assumption Agreement; and

 

  

25

  

 

	  	
2.1.3.

	
Black Cloud Assets.  Golden Rex shall sell, transfer, convey, assign, deliver and set over to Purchaser, and Purchaser will purchase and accept, all of Golden Rex’s right, title, benefit and interest in the Black Cloud Assets pursuant to the applicable Quitclaim Deed.

	  	
2.2.

	
Excluded Assets.  Notwithstanding anything to the contrary contained herein, the Acquired Assets do not include, and in no event will Purchaser acquire any right, title, benefit or interest in, to or under, any of the Excluded Assets.

	  	
2.3.

	
Assumed Liabilities.  Provided that the Closing occurs and upon the terms and subject to the conditions of this Agreement, Purchaser, as of the Closing Date, will assume and agree to pay, perform and discharge when due and hold each Seller Indemnified Party harmless from the Assumed Liabilities.  Notwithstanding anything contrary contained herein, Purchaser shall not be liable for any Liability arising from Sellers’ ownership or operation of the Acquired Assets arising prior to the Closing Date except to the extent described on Schedule 1.1D.

	  	
2.4.

	
Excluded Liabilities.  Notwithstanding anything to the contrary contained herein, the Assumed Liabilities shall not include, and in no event will Purchaser assume, be required to pay, perform, discharge, indemnify or hold any Seller Indemnified Party harmless from, any Excluded Liabilities, it being understood and agreed that except to the extent described on Schedule 1.1D, Purchaser is responsible only for Liabilities related to the Acquired Assets arising after the Closing Date.

 

	  	
2.5.

	
Termination of November Agreement.  The Parties hereby agree that the November Agreement is terminated and replaced in its entirety by the Documents.

	
3.

	
PURCHASE PRICE

	  	
3.1.

	
Components.  The purchase price (the “Purchase Price”) for the Acquired Assets shall consist of the following:

	 	3.1.1. 	
Cash.  The total cash portion of the Purchase Price (the “Cash Consideration”) for the Acquired Assets is Six Hundred Thousand and No/100th Dollars ($600,000.00).  One Hundred Thousand and No/100th Dollars ($100,000.00) already has been paid to and received by Sellers pursuant to the November Agreement.  An additional sum of One Hundred and Ten Thousand and No/100th Dollars ($110,000.00) was paid to Sellers by Purchaser on May 10, 2010.  Sellers hereby agree that a sum of Sixty Thousand and No/100th Dollars ($60,000.00) shall be placed into the COLTAF Fund of Sellers’ Counsel and shall be distributed to the Property Owners on June 1, 2010.  The final sum of Three Hundred Ninety Thousand and No/100th Dollars ($390,000.00) shall be paid to Sellers by Purchaser in Acceptable Funds on the Closing Date (the “Closing Date Payment”).

	  	
3.1.2.

	
Securities. An additional portion of the Purchase Price for the Acquired Assets consists of (5,000,000) “restricted” (as that term is defined in Rule 144 as promulgated by the SEC pursuant to the Securities Act) shares (the “Purchase Shares”) of the common stock of Parent as described in the Registration Rights Agreement (the Purchase Shares hereinafter are referred to as the “Share Consideration”).

For purposes of computing the value of the Purchase Shares for Tax purposes, such value shall be equal to the average of the closing price of Parent’s common stock on the Over the Counter Bulletin Board (the “OTCBB”), or if not then listed for trading on the OTCBB, on the Pink OTC Markets Inc.’s over the counter Pink Sheets market, for the seven (7) consecutive business days immediately prior to the Closing Date.

	  	
3.2.

	
Purchase Price Non-Refundable.  Purchaser hereby acknowledges that each portion of the Purchase Price becomes non-refundable as of the date paid or issued, as applicable.

	  	
3.3.

	
Allocation.  The Parties hereby agree that the Purchase Price shall be allocated as follows:

 

  

26

  

	  	
3.3.1.

	
Share Consideration.  The full portion of the Share Consideration shall be allocated to Global; and

	  	
3.3.2.

	
Cash Consideration.  The Cash Consideration shall be allocated entirely to Mount Royale.

Each Party shall report such allocations on its Tax Returns in accordance with Sections3.3.1 and 3.3.2 above.

	
4.

	
CLOSING MATTERS AND COVENANTS

	  	
4.1.

	
Closing.  Upon the terms and subject to the conditions of this Agreement, the Closing will take place, either in person or by exchange of counterparts through facsimile or other electronic means, beginning at 9:00 a.m. (local time) at the offices of Sellers’ Counsel, 621 17th Street, Suite 1900, Denver, Colorado 80293 no later than the second Business Day following the satisfaction or waiver of all conditions of the Parties to consummate the transactions contemplated by this Agreement (other than the conditions with respect to actions the respective parties will take at the Closing itself) (such period hereinafter referred to as the “Due Diligence Period”), or at such other place, date or time as is mutually agreed to by Global and Purchaser, which in any event shall be no later than June 15, 2010, subject to the provisions of Section 4.4.2(g)(ii), (the “Closing Date”).  All documents delivered and all transactions consummated at the Closing will be deemed for all purposes to have been delivered and consummated effective as of the Closing Date.

	  	
4.2.

	
Deliveries by Sellers.  At the Closing, the applicable Seller will deliver or cause to be delivered to Purchaser the following:

	  	
4.2.1.

	
Transfer Documents.  Duly executed counterparts of the Assumption Agreement, duly executed Bill of Sale, and a duly executed and acknowledged Quitclaim Deed to which such Seller is a party;

	  	
4.2.2.

	
Registration Rights Agreement.  Duly executed counterparts of the Registration Rights Agreement;

	  	
4.2.3.

	
Intentionally Omitted.

	  	
4.2.4.

	
Good Standing Certificate.  A certificate of good standing from the state of organization of each Seller, which will be dated not more than five (5) days prior to the Closing Date;

	  	
4.2.5.

	
Intentionally Omitted.

	  	
4.2.6.

	
Liens.  Releases and discharges of all Liens (other than Permitted Liens) affecting the portion of the Acquired Assets owned by the applicable Seller;

	  	
4.2.7.

	
Secretary’s Certificate.  A certificate of the Secretary or Assistant Secretary of each Seller containing a true and correct copy of the resolutions duly adopted by the board of directors or other governing body of such Seller, approving and authorizing each of the Documents to which each Seller is a party and each of the transactions contemplated hereby and thereby.  The Secretary or Assistant Secretary of each Seller also shall certify such resolutions have not been rescinded, revoked, modified, or otherwise affected as of the Closing Date and remain in full force and effect as of the Closing Date;

	  	
4.2.8.

	
Incumbency Certificate.  A certificate of incumbency of each Seller executed by the Secretary or Assistant Secretary of such Seller listing the Authorized Officers of each Seller authorized to execute each of the Documents to which such Seller is a party on behalf of such Seller and, certifying the authority of each such Authorized Officer to execute the agreements, documents, and instruments on behalf of such Seller in connection with the consummation of the transactions contemplated herein;

 

  

27

  

 

	  	
4.2.9.

	
Affidavits of Non-Foreign Seller. Affidavits of Non-Foreign Seller for each of Mount Royale and Golden Rex;

	  	
4.2.10.

	
Cross Receipt.  A cross receipt, indicating receipt by the applicable Seller of the Closing Date Payment and the Purchase Shares; and

	  	
4.2.11.

	
Other Documents.  Such other duly executed documents, instruments and certificates as reasonably may be required to be delivered by Sellers pursuant to the terms of this Agreement.

 

	  	
4.3.

	
Deliveries by Purchaser.

At the Closing, Purchaser will deliver or cause to be delivered to Sellers the following:

	  	
4.3.1.

	
Closing Date Payment.  The Closing Date Payment as provided in Section 3.1.

	  	
4.3.2.

	
Purchase Shares.  Certificates representing the Purchase Shares, duly executed by an Authorized Officer of Parent, accompanied by such directions to any registrar or transfer agent as may be required to vest indefeasible title in the Purchase Shares in Global;

	  	
4.3.3.

	
Assumption Agreement.  Duly executed counterparts of the Assumption Agreement;

	  	
4.3.4.

	
Registration Rights Agreement.  Duly executed counterparts of the Registration Rights Agreement;

	  	
4.3.5.

	
Good Standing Certificate.  A certificate of good standing of each Purchaser Party from the Secretary of State of the State of Colorado (for Purchaser) and of Delaware (for Parent), each of which will be dated not more than five (5) days prior to the Closing Date;

	  	
4.3.6.

	
Organizational Documents.  A certificate of an Authorized Officer of Parent certifying that the Organizational Documents of Parent, as certified and delivered at the Closing, have not been amended or rescinded since the date of such certification and remain in full force and effect at the Closing Date;

	  	
4.3.7.

	
Secretary’s Certificate.  A certificate of the Secretary or Assistant Secretary of such Purchaser Party containing a true and correct copy of the resolutions duly adopted by the board of directors or other governing body of each such Purchaser Party, approving and authorizing each Document to which each such Purchaser Party is a party and each of the transactions contemplated hereby and thereby.  The Secretary or Assistant Secretary of each such Purchaser Party also shall certify such resolutions have not been rescinded, revoked, modified, or otherwise affected as of the Closing Date and remain in full force and effect as of the Closing Date;

	  	
4.3.8.

	
Incumbency Certificate.  A certificate of incumbency of each Purchaser Party executed by the Secretary or Assistant Secretary of each such Purchaser Party listing the Authorized Officers of each such Purchaser Party authorized to execute each Document to which each such Purchaser Party is a party and the Transfer Documents to which each such Purchaser Party is a party and, certifying the authority of each such Authorized Officer to execute the agreements, documents, and instruments on behalf of each such Purchaser Party in connection with the consummation of the transactions contemplated herein;

	  	
4.3.9.

	
Cross Receipt.  A cross receipt from Purchaser, indicating its acceptance of the Acquired Assets; and

	  	
4.3.10.

	
Other Documents.  Such other duly executed documents, instruments and certificates as reasonably may be required to be delivered by the applicable Purchaser Party pursuant to the terms of this Agreement.

 

  

28

  

 

	  	
4.4.

	
Conditions Precedent to Closing.  No Party shall be required to consummate the transactions contemplated hereby unless and until the following shall have occurred:

	  	
4.4.1.

	
Conditions to Obligations of Sellers.  The obligation of Sellers to consummate and effect the transactions contemplated hereby shall be subject to the satisfaction at or prior to the Closing Date of each of the following conditions, any of which may be waived, in writing, by Global:

	  	
a)

	
Representations and Warranties.  Each representation and warranty of each Purchaser Party contained in this Agreement shall be true and correct as of the date of this Agreement and as of the Closing Date, except (i) for those representations and warranties that addressed matters only as of a particular date prior to the date hereof (which representations shall have been true and correct as of such particular date) and (ii) where the failure to be true and correct would not have and would not reasonably be expected to have a Material Adverse Effect on the applicable Purchaser Party; provided that, to the extent such representations and warranties contain the term “Material Adverse Effect”, such representations and warranties (as so written, including the term “Material Adverse Effect”) shall be true and correct on and as of the date of this Agreement and the Closing Date.

	  	
b)

	
Agreements and Covenants.  Each Purchaser Party shall have performed and complied in all material respects with all of its covenants hereunder that are required to be performed or complied with by such Purchaser Party prior to the Closing.

	  	
c)

	
No Order.  No Action shall be pending before any Governmental Authority or before any arbitrator wherein an unfavorable Order would (i) prevent consummation of any of the transactions contemplated by this Agreement, or (ii) cause any of the transactions contemplated by this Agreement, including, without limitation, issuance of any portion of the Share Consideration, to be rescinded following consummation (and no such Order shall be in effect).

	  	
d)

	
Deliveries.  All deliveries of the applicable Purchaser Party described in Section 4.3 above shall have been delivered to Sellers and shall be in form and content reasonably satisfactory to Sellers and Sellers’ Counsel; and

	  	
e)

	
Material Adverse Change.  No Material Adverse Change shall have occurred with respect to either Purchaser Party or Parent’s capital stock.

	  	
4.4.2.

	
Conditions to Obligations of the Purchaser Parties.  The obligation of the Purchaser Parties to consummate and effect the transactions contemplated hereby shall be subject to the satisfaction at or prior to the Closing Date of each of the following conditions, any of which may be waived, in writing, exclusively by Purchaser:

	  	
a)

	
Representations and Warranties.  Each representation and warranty of each Seller contained in this Agreement shall be true and correct as of the date of this Agreement and as of the Closing Date, except (i) for those representations and warranties which addressed matters only as of a particular date prior to the date hereof (which representations shall have been true and correct as of such particular date) and (ii) where the failure to be true and correct would not have and would not reasonably be expected to have a Material Adverse Effect on the portion of the Acquired Assets owned by such Seller; provided that, to the extent such representations and warranties contain the term “Material Adverse Effect”, such representations and warranties (as so written, including the term “Material Adverse Effect”) shall be true and correct on and as of the date of this Agreement and Closing Date, as applicable.

	  	
b)

	
Agreements and Covenants.  Each Seller shall have performed and complied in all material respects with all of its covenants hereunder that are required to be performed or complied with by such Seller prior to the Closing.

 

  

29

  

 

	  	
c)

	
No Order.  No Action shall be pending before any Governmental Authority or before any arbitrator wherein an unfavorable Order would (i) prevent consummation of any of the transactions contemplated by this Agreement, or (ii) cause any of the transactions contemplated by this Agreement to be rescinded following consummation (and no such Order shall be in effect).

	  	
d)

	
Material Adverse Change.  No Material Adverse Change shall have occurred with respect to the Acquired Assets.

	  	
e)

	
Records.  The MRV Records shall have been delivered to Purchaser.

	  	
f)

	
Deliveries.  All deliveries of each applicable Seller described in Section 4.2 above shall have been delivered to Purchaser and shall be in form and content reasonably satisfactory to Purchaser and its counsel; and

	  	
g)

	
Due Diligence.

	  	
i.

	
Access.  During the Due Diligence Period, Sellers shall provide the Purchaser or its representatives with reasonable access during regular business hours to make such investigation of the Acquired Assets and to conduct such examination of the condition of the Acquired Assets and Assumed Liabilities as Purchaser reasonably deems necessary or advisable to familiarize itself with the assets, properties, books, records and other matters and to verify the representations and warranties of each Seller hereunder, including, without limitation, discussions with the Sellers’ officers, employees and independent accountants; provided that Purchaser and its representatives shall conduct such investigation in a manner so as to minimize the disruption of the business of each Seller.

	  	
ii.

	
Environmental Issues.  The Parties hereby agree that the only due diligence defect that permits the Purchaser Parties to terminate this Agreement during or prior to the Due Diligence Period shall be a material environmental defect in the Acquired Assets.  For purposes of this clause (ii), the term “material environmental defect” shall mean either (A) that the cost to remediate the environmental defect(s) in question exceeds $100,000 or (B) the defect consists of overtopping of any part of the tailings pond at the mill.  If there is a material environmental defect as defined herein, then this Agreement shall terminate in accordance with the provisions of Section 4.8.1 below.

	  	
4.4.3.

	
Additional Actions.  Each of the Parties hereto shall use its commercially reasonable efforts to take all action and to do all things necessary, proper or advisable in order to consummate and make effective the transactions contemplated by this Agreement as promptly as reasonably practicable, subject to the terms and conditions of this Agreement, including (i) satisfaction, unless waived by the Party to whose benefit they would otherwise accrue, of the closing conditions set forth herein, (ii) the defending of any Actions challenging the transactions contemplated by this Agreement or the performance of the obligations of any Party hereto in connection therewith, (iii) obtaining, delivering or effecting any waivers, modifications, permits, consents, approvals, authorizations, qualifications, notices, releases, registrations and filings as are required in connection with the consummation of the transactions contemplated by this Agreement, and (iv) the execution and delivery of such instruments and the taking of such other actions, including the furnishing to each other Party hereto of assistance or information, as the other Party hereto may reasonably require in order to carry out the intent of this Agreement.

	  	
4.4.4.

	
Bonds.  Purchaser shall cooperate with Sellers to obtain the requisite consent from all Governmental Authorities to the release of the Reclamation Bonds.  Purchaser shall replace the same with comparable financial instruments issued for the benefit of Purchaser acceptable to the applicable Governmental Authority to which the applicable Reclamation Bond is pledged.  Each Seller hereby agrees that, until Purchaser is able to post its own bonds with each applicable Governmental Authority, the Reclamation Bonds will remain in full force and effect and the applicable Seller shall not apply for any release thereof.  Purchaser hereby acknowledges and agrees to (a) notify Global promptly, but in any event within five (5) Business Days, after Purchaser is advised of the amount of any bond required to be posted by Purchaser with any Governmental Authority and (b) assist the applicable Seller to the extent reasonably necessary to obtain the release of the corresponding Reclamation Bond being replaced by the bond to be posted by Purchaser.

 

  

30

  

 

	  	
4.4.5.

	
Permits.  Sellers shall cooperate with Purchaser to achieve the assignment or other transfer of the Permits to Purchaser.

	  	
4.4.6.

	
Certificates of Title.  Sellers shall cooperate with Purchaser to achieve the transfer of titles for the following vehicles to Purchaser: (i) 1995 Chevrolet GK2 Pickup (green), VIN No. 1GCFK24K5SZ128678; (ii) 1992 Chevrolet Pickup (tan), CO license plate 344 EAF; (iii) 1990 International Dump Truck 4800, VIN No. 1HTSETVR9LH224153; and (iv) Ford F-250 Welding Truck locked up in the core storage shop located at the MRV Property.

	  	
4.5.

	
Post Closing Access to Books and Records.  Following the Closing, the Purchaser Parties and Sellers will afford each other, and their respective advisors, during normal business hours, reasonable access to, in the case of Sellers, the Excluded Books and Records, including those books and records related to the Excluded Liabilities and, in the case of each Purchaser Party, the Business Books and Records, including those books and records related to Assumed Liabilities or any of the Share Consideration, in its possession or control with respect to periods through the Closing and the right to make copies and extracts therefrom to the extent such access reasonably may be required by the requesting Party in connection with (a) the preparation of Tax Returns, (b) any Tax audit, Tax protest or other proceeding relating to Taxes, (c) compliance with the requirements of any Governmental Authority or business, legal or tax advisor, or (d) any actual or threatened Action; provided that this Section 4.5 shall not apply to any Actions in which the Parties or any of their respective Affiliates are adverse to each other.

	  	
4.6.

	
Actions.  During the Due Diligence Period, Sellers promptly shall inform Purchaser of the initiation of any Action and of any significant developments with respect to any such Action or any Action in existence on the date hereof.

	  	
4.7.

	
Taxes.

	  	
4.7.1.

	
Ordinary Course of Business.  All Taxes (other than Income Taxes), including real estate, personal property, public service company Taxes, and any similar charges or assessments, including utility Taxes, rent-related Taxes and service-related Taxes (collectively, “Periodic Taxes”), attributable to the Acquired Assets, and accruing prior to the Closing Date shall be paid by the applicable Seller.  Any Periodic Taxes accruing after Closing Date which are not part of the Excluded Liabilities shall be paid by Purchaser when and as due.

	  	
4.7.2.

	
Transfer Taxes.  All federal, state or local transfer Taxes including excise, sales, use, stamp, documentary, filing, recordation, notarial and other Taxes and fees that may be imposed or assessed as a result of or in order to effectuate the sale, assignment, conveyance or transfer of any Acquired Asset shall be borne equally by Purchaser and the applicable Seller, and shall be paid, when due, directly to the relevant Governmental Authority.  Sellers and Purchaser will cooperate to minimize the amount of transfer Taxes associated with the transaction to the extent reasonably practicable.

	  	
4.7.3.

	
Tax Reports and Returns.  Sellers shall file all Income Tax returns for the period of time prior to the Closing Date, and Purchaser shall file all Income Tax returns for the period after the Closing Date.

 

  

31

  

 

	  	
4.8.

	
Termination.

	  	
4.8.1.

	
Termination Events.  This Agreement shall terminate and be of no further force or effect upon the occurrence of any of the following:

	  	
a)

	
Mutual Agreement.  The mutual agreement of the Parties; or

	  	
b)

	
Environmental Defects.  The occurrence of a material environmental defect described more fully in Section 4.4.2(g)(ii) that the Sellers elect not to cure.

	  	
4.8.2.

	
No Other Rights of Termination.  Except as set forth above, there shall be no other right to terminate this Agreement, including, without limitation, based upon any actions taken by Mark Steen with respect to any portion of the Acquired Assets on or before the Closing Date.

	  	
4.8.3.

	
Effect of Termination.  If this Agreement shall terminate pursuant to the provisions of this Section 4.8, no Party shall have any rights hereunder; provided, however, the Purchaser Parties hereby acknowledge and agree that any portion of the Cash Consideration paid to any Seller prior to such termination may be retained by such Seller as liquidated damages and not as a penalty.

	
5.

	
REPRESENTATIONS AND WARRANTIES

	  	
5.1.

	
Representations and Warranties of Sellers. Each Seller represents and warrants, to the Purchaser Parties that, except as set forth in the Disclosure Schedules:

	  	
5.1.1.

	
Organization and Existence.

	  	
a)

	
Such Seller is duly organized, validly existing, and in good standing under the laws of its jurisdiction of organization, with full power and authority to own, lease, and operate its portion of the Acquired Assets and to carry on its business as and where the portion of the Acquired Assets owned by such Seller presently are owned or leased or where the business of such Seller is conducted.  Such Seller is qualified and is in good standing as a foreign entity in each jurisdiction where such qualification is required by Law, except where failure to be so qualified would not have a Material Adverse Effect.

	  	
b)

	
Each Seller has provided Purchaser with true and correct copies of such Seller’s Organizational Documents, none of which have been amended, modified or rescinded since the date provided to Purchaser.

	  	
5.1.2.

	
Authority and Approval; Due Execution and Delivery. Except as disclosed on Schedule 5.1.2:

	  	
a)

	
such Seller has the requisite power and authority to execute and deliver each of the Documents to which it is a party and to perform its obligations thereunder;

	  	
b)

	
The execution, delivery and performance by each Seller of its obligations under each Document to which it is to be a party, and the consummation by such Seller of the transactions contemplated herein and therein, have been duly authorized by all required actions on the part of such Seller; and

 

	  	
c)

	
Each Document to which each Seller is a party is and will be, when executed and delivered by such Seller, the valid and binding obligations of such Seller, enforceable against such Seller in accordance with their respective terms, except as may be limited by bankruptcy, insolvency, moratorium, or other similar laws affecting the enforcement of creditors’ rights generally or by general principles of equity (regardless of whether considered in a proceeding at Law or in equity).

	  	
5.1.3.

	
No Conflict.  Except as disclosed on Schedule 5.1.3 the execution and delivery by such Seller of each Document to which it is a party, and the consummation by such Seller of the transactions contemplated hereby and thereby, do not and will not (i) conflict with such Seller’s applicable Organizational Documents, or require the consent of any Person that has not been obtained under such Seller’s applicable Organizational Documents, (ii) violate, conflict with, result in a breach of, constitute a default under (whether with or without notice or the lapse of time or both), accelerate or permit the acceleration of the performance required by, or require any consent, authorization, or approval under, any contract to which such Seller is a party or by which such Seller is bound or to which any portion of the Acquired Assets owned by such Seller is subject, except to the extent any such violation, conflict or breach, or failure to obtain a consent, authorization or approval would not reasonably be expected to have a Material Adverse Effect or (iii) result in the creation of any Lien (other than a Permitted Lien) upon the portion of the Acquired Assets owned by such Seller.

 

  

32

  

 

	  	
5.1.4.

	
Governmental Approvals and Filing.  Except as disclosed on Schedule 5.1.4 no consent, authorization, approval or action of, filing with, notice to, or exemption from any Governmental Authority on the part of such Seller is required in connection with the execution, delivery and performance of any Document to which such Seller is a party or the consummation of the transactions contemplated hereby or thereby, except where the failure to obtain any such consent, approval or action, to make any such filing, to give any such notice or obtain any such exemption would not be reasonably expected to have a Material Adverse Effect.

	  	
5.1.5.

	
Taxes.

	  	
i.

	
Such Seller has not received any notice of assessment against any portion of the Acquired Assets owned by such Seller and to the best knowledge of such Seller (A) all Taxes have been paid when due, except to the extent any of such Taxes are being contested in good faith and (B) there are no Tax examinations, Tax claims or Tax actions currently pending or asserted in writing or otherwise with respect to such portion of the Acquired Assets owned by such Seller.

 

	  	
ii.

	
Such Seller has complied with all applicable Laws relating to the payment of Taxes pertaining to the portion of the Acquired Assets owned by such Seller.

	  	
iii.

	
Such Seller is not a foreign person for the purpose of and within the meaning of Section 1445 of the Code and applicable Treasury Regulations, and at the Closing such Seller shall provide Purchaser with an affidavit certifying as to such status at the Closing.

	  	
iv.

	
There are no Liens for Taxes (other than Permitted Liens) on the portion of the Acquired Assets owned by such Seller.

	  	
v.

	
No written claim or deficiency for any Taxes has been asserted against the Acquired Assets owned by such Seller that has not been resolved and/or paid in full.

	  	
5.1.6.

	
Liabilities Attributable to Acquired Assets.  As of the Closing Date, there are no Liabilities attributable to the Acquired Assets, except as disclosed on Schedule 5.1.6.

 

	  	
5.1.7.

	
Title.  Such Seller owns good and marketable title in and to the portion of the Acquired Assets owned by such Seller, free and clear of all Liens except (a) the water rights in the Left Hand Ditch Company, and (b) as disclosed on Schedule 5.1.7.

	  	
5.1.8.

	
Legal Proceedings. Except as disclosed on Schedule 5.1.8:

 

	  	
a)

	
There are no Actions pending or, to the knowledge of such Seller, threatened in writing against such Seller, that, if adversely decided, reasonably would be expected to have a Material Adverse Effect on the Acquired Assets; and

 

  

33

  

 

	  	
b)

	
To the knowledge of such Seller, such Seller is not subject to any Order and such Seller has not been threatened in writing to be subject to any Order that reasonably would be expected to have a Material Adverse Effect on the Acquired Assets.

	  	
5.1.9.

	
Compliance with Laws.  Except as disclosed on Schedule 5.1.9:

	  	
a)

	
Such Seller has operated the portion of the Acquired Assets owned by such Seller in material compliance with applicable Laws; and

	  	
b)

	
Such Seller has not received any written Order or other written communication from any Governmental Authority of any alleged, actual or potential material Liability or violation of or failure to comply with any applicable Laws with respect to the portion of the Acquired Assets owned by such Seller.

 

	  	
5.1.10.

	
Environmental Matters.  To such Seller’s knowledge, such Seller is in material compliance with all Environmental Laws applicable to the portion of the Acquired Assets owned by such Seller, except as disclosed on Schedule 5.1.10.

 

	  	
5.1.11.

	
No Brokers.  Based upon the guidelines of the TSX, no broker, finder or similar agent has been employed by or on behalf of such Seller, and no Person with whom such Seller has had any dealings or communications of any kind, is entitled to any brokerage commission, finder’s fee or any similar compensation in connection with this Agreement or the transactions contemplated hereby.

	  	
5.1.12.

	
Intentionally Omitted.

	  	
5.1.13.

	
Disclosure.  This Agreement (including the Exhibits and the Schedules hereto, as any of the same may be modified or qualified by the Disclosure Schedules), does not contain any untrue statement of a material fact or omit to state any material fact required to make the statements herein or therein not misleading in the light of the circumstances under which those statements were made.  There is no fact known to any Seller that has a Material Adverse  Effect or threatens in the future to have a Materially Adverse Effect on the portion of the Acquired Assets owned by the applicable Seller which has not been disclosed to the Purchaser Parties by the applicable Seller in writing.

	  	
5.1.14. 

	
Securities. Global represents and warrants to Parent that Global:

	  	
i.

	
understands and acknowledges that the Purchase Shares have not been registered under the Securities Act, under any state securities laws, or under the applicable federal and provincial laws of Canada (the “Applicable Canadian Securities Laws”) in reliance upon exemptions from (i) the registration requirements of the Securities Act afforded by Section 4(2) thereof and Regulation S as promulgated by the SEC thereunder and (ii) prospectus delivery requirements of the Applicable Canadian Securities Laws afforded by Section 2.13 of the National Instrument 45-106 Prospectus and Registration Exemptions (“NI-45-106”);

	  	
ii.

	
is acquiring the Purchase Shares solely for its own account and not as nominee or agent for any other person and not with a view to, or for offer or sale in connection with, any distribution thereof (within the meaning of the Securities Act and the rules and regulations promulgated thereunder); that would be in violation of the federal and state securities laws.

	  	
iii.

	
is able to bear the economic risk associated with its acquisition of the Purchase Shares and either alone or together with its representatives, has such knowledge, sophistication and experience in business and financial matters so as to be capable of evaluating and assessing the merits and risks of its acquisition of the Purchase Shares and has so evaluated the merits and risks of such investment and has determined that the Purchase Shares are suitable to investment for it;

 

  

34

  

 

	  	
iv.

	
understands and acknowledges that no securities commission, stock exchange, governmental agency, regulatory body or similar authority has made any finding or determination or expressed any opinion with respect to the merits of an acquisition of the Purchase Shares.

	  	
v.

	
confirms that neither Parent nor any of its directors, employees, officers, consultants, agents or affiliates, has made any representations (written or oral) to it regarding the value of the Purchase Shares and acknowledges and confirms that, other than as required by the Registration Rights Agreement, no representation has been made to Global with respect to the listing of the Purchase Shares on any exchange or that application has been or will be made be made for such listing. In making its investment decision with respect to the Purchase Shares, Global has relied solely upon publicly available information relating to Parent and the written representation made by or on behalf of Parent herein;

	  	
vi.

	
acknowledges that the acquisition of the Purchase Shares is a speculative investment involving substantial risks, including, but not limited to, the risks set forth in the SEC Reports, which risks Global has reviewed and considered, and are incorporated herein by reference;

	  	
vii.

	
acknowledges that Parent will, from time to time, offer and sell additional shares of common stock (or securities convertible into or exercisable or exchangeable for shares of its common stock) on such terms and conditions as its board of directors, in its sole discretion, may determine. The terms and conditions of the offer and sale of any such additional securities may adversely affect Parent’s existing shareholders;

	  	
viii.

	
acknowledges that the certificates representing the Purchase Shares will bear a legend substantially as follows:

“THE SECURITIES TO WHICH THIS CERTIFICATE RELATES HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”) AND THE RULES AND REGULATIONS PROMULGATED THEREUNDER AND MAY NOT BE OFFERED OR SOLD DIRECTLY OR INDIRECTLY (A) WITHIN THE UNITED STATES OR TO OR FOR THE ACCOUNT OR BENEFIT OF U.S. PERSONS (AS DEFINED IN REGULATION S) EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AS TO SUCH SECURITIES UNDER, IN COMPLIANCE WITH REGULATION S AND/OR OTHER APPLICABLE EXEMPTION FROM, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, OR (B) IN CANADA OR TO RESIDENTS OF CANADA EXCEPT PURSUANT TO REGISTRATIONS AND PROSPECTUS EXEMPTIONS UNDER THE APPLICABLE PROVINCIAL SECURITIES LAWS AND REGULATIONS OR PURSUANT TO AN EXEMPTION ORDER MADE BY THE APPROPRIATE PROVINCIAL SECURITIES REGULATOR(S), IN EACH CASE AS EVIDENCED BY AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY.”

 

	  	
ix.

	
understands and acknowledges that Parent has the right not to record a purported transfer of the Purchase Shares without Parent being satisfied that such transfer is exempt from or not subject to (a) registration under the Securities Act and any applicable state securities laws, and (b) the registration and prospectus requirements under Applicable Canadian Securities Laws;

 

  

35

  

 

	  	
x.

	
understands and acknowledges that in addition to resale restrictions imposed under U.S. federal securities law, there are additional restrictions on Global’s ability to resell the Purchase Shares under Applicable Canadian Securities Law;

	  	
xi.

	
understands and acknowledges that, except as provided in the Registration Rights Agreement, Parent is not obligated to file and has no present intention or obligation of filing any registration statement or prospectus in respect of re-sales of the Purchase Shares with the SEC in the United States or with any of the provincial securities regulatory authorities in Canada;

 

	  	
xii.

	
Is a resident of British Columbia, Canada and is not a “U.S. Person” as that term is defined in Rule 902 of Regulation S; and, is not, and on the Closing Date will not be, an Affiliate of Parent;

	  	
xiii.

	
the Purchase Shares have not been offered to it in the United States and the individuals making the decision to purchase the Purchase Shares and executing and delivering this Agreement on its behalf of were not in the United States when the decision was made and this Agreement was executed and delivered; all offers and sales of the Purchase Shares shall be made in compliance with all applicable laws of any applicable jurisdiction and, particularly, in accordance with Rules 903 and 904, as applicable, of Regulation S or pursuant to registration of the Purchase Shares under the Securities Act or pursuant to an exemption from registration;  it will not engage in any activity for the purpose of, or that could reasonably be expected to have the effect of, conditioning the market in the United States for any of the Purchase Shares and, neither Global nor any of its affiliates will directly or indirectly maintain any short position, purchase or sell put or call options or otherwise engage in any hedging activities in any of the Purchase Shares or any other securities of Parent until after the end of the Distribution Compliance Period (as defined in Regulation S), and acknowledges that such activities are prohibited by Regulation S;

 

	  	
xiv.

	
Global understands that it is purchasing the Purchase Shares pursuant to certain exemptions from the registration and prospectus requirements of applicable securities legislation in Canada  afforded by, without limitation, Sections 2.13  of NI 45-106 and, as a consequence, (A) certain rights, remedies and protections under securities legislation will not be available to Global in connection with the acquisition of the Purchase Shares; (B) Global may not receive information that would otherwise be required to be provided to it under Applicable Canadian Securities Laws; and (C) Parent is relieved from certain obligations that would otherwise apply under securities legislation.

 

	  	
5.2.

	
Representations and Warranties of Purchaser Parties.  Each Purchaser Party hereby represents and warrants to Sellers as of the date of this Agreement that:

	  	
5.2.1.

	
Organization and Existence.  Such Purchaser Party is duly organized, validly existing and in good standing under the laws of its jurisdiction of organization, with full power and authority to own, lease, and operate its business and properties and to carry on its business as and where such properties and assets are now owned or leased and such business is now conducted.  Purchaser is a wholly-owned subsidiary of Parent.

 

  

36

  

 

	  	
5.2.2.

	
Authority and Approval; Due Execution and Delivery.  Such Purchaser Party has the power  and authority to execute and deliver each of the Documents to which it is to be a party and to perform its obligations hereunder or thereunder.  The execution, delivery and performance by each Purchaser Party of the Documents to which it is to be a party and the consummation by each Purchaser Party of the transactions contemplated herein and therein, have been duly authorized by all required actions on the part of such Purchaser Party.  Each of the Documents is and will have been duly executed and delivered by each Purchaser Party that is a party hereto and thereto.  Each Document to which each such Purchaser Party is a party when executed and delivered by such Purchaser Party is and will be, the valid and binding obligations of such Purchaser Party, enforceable against such Purchaser Party in accordance with their respective terms, except as may be limited by bankruptcy, insolvency, moratorium, or other similar laws affecting the enforcement of creditors’ rights generally or by general principles of equity (regardless of whether considered in a proceeding at Law or in equity).

	  	
5.2.3.

	
No Conflict.  The execution and delivery by such Purchaser Party of each of the Documents to which it is to be a party, and such Purchaser Party’s compliance with the terms and conditions hereof and thereof, and the consummation by such Purchaser Party of the transactions contemplated hereby and thereby, do not and will not (i) conflict with any of such Purchaser Party’s Organizational Documents, or require any consent of any Person that has not been obtained under, such Purchaser Party’s Organizational Documents or (ii) violate any provision of, or require any consent, authorization, or approval under, any Law or any Order applicable to such Purchaser Party.

	  	
5.2.4.

	
Governmental Approvals and Filing.  No consent, authorization, approval or action of, filing with, notice to, or exemption from any Governmental Authority on the part of such Purchaser Party is required in connection with the execution, delivery and performance of any of the Documents to which such Purchaser Party is to be a party or the consummation of the transactions contemplated hereby or thereby.

	  	
5.2.5.

	
Brokers.  Based upon the guidelines of the TSX, no broker, finder or investment banker is entitled to any brokerage commission, finder’s fee or similar payment in connection with the transactions contemplated hereby based upon arrangements made by or on behalf of such Purchaser Party.

 

	  	
5.2.6.

	
Capital Stock.

	  	
a)

	
Authorized/Outstanding Stock.  The authorized capital stock and the outstanding capital stock of Parent consists in each case as of the date hereof solely of the shares indicated on Schedule 5.2.6(a) to this Agreement.  All of the outstanding shares, including those constituting the Share Consideration, have been duly authorized, are fully paid and non-assessable, and were or will be issued in compliance with all applicable securities laws, subject, in the case of the shares constituting the Share Consideration, to the accuracy and the truthfulness of the representation of Global contained herein.

	  	
b)

	
Preemptive; Registration Rights.  Parent has granted registration rights in connection with its consummation of various private placements as more fully described in the Parent Registration Statement.

	  	
c)

	
Options; Warrants.  Except as set forth in the SEC Reports, there are no outstanding warrants, options, convertible securities or other agreements or arrangements of any character under which Parent or any subsidiary is or may be obligated to issue any equity securities of any kind, or to transfer any equity securities of any kind owned by them.

  

37

  

 

	  	
d)

	
Buy/Sell/Voting Agreements.  Except as set forth in the SEC Reports, Parent does not know of any voting agreements, buy-sell agreements, option or right of first refusal or other agreements of any kind among any of the security holders of Parent or any of the subsidiaries relating to the securities held by them.

	  	
e)

	
Future Registrations.  Parent has not agreed, and does not have any present intention, to register, over the next three months, any of its securities under the Securities Act of 1933, as amended (the “Securities Act”), except as provided in the Registration Rights Agreement and except for the Parent Registration Statement or any amendment thereto or additional registration statements required in order to register for resale the securities included in such registration statement.

	  	
f)

	
Offering of Shares.  No consent, authorization, approval, permit or order of, or declaration to or filing with, any Governmental Authority is required in connection with the offer, issuance, sale or delivery of any of the Share Consideration, except as may be required by the Province of British Columbia, Canada.  Assuming the truth and accuracy of the representations and warranties of Global set forth in Section 5.1.14 above, the issuance of the Purchase Shares in conformity with the terms of this Agreement constitutes a transaction exempt from the registration requirements of Section 5 of the Securities Act, and from all applicable state registration and qualification requirements in the United States.

	  	
g)

	
No Offer or Sale.  Neither the Parent nor any agent acting on its behalf has, directly or indirectly, sold or offered for sale, or solicited any offers to buy, any securities, or otherwise approached or negotiated with any Person so as to subject the offer or issuance of the Purchase Shares to Global to the provisions of Section 5 of the Securities Act, and Parent agrees that neither it nor any agent acting on its behalf will take any action that would subject the offer or issuance of the Purchase Shares to those provisions.

	  	
h)

	
Disclosure.  This Agreement, (including the Exhibits and the Schedules hereto and thereto, as any of the same may be modified or qualified by the Disclosure Schedules) does not contain any untrue statement of a material fact or omit to state any material fact required to make the statements herein or therein not misleading in the light of the circumstances under which those statements were made.  There is no fact known to Parent that has a Material Adverse Effect on the business, assets, liabilities, condition (financial or otherwise), affairs or operations of Parent, which has not been disclosed by Parent to the Sellers in writing.

	  	
5.3.

	
Survival.  The representations and warranties of each of the Parties hereto shall survive the execution and delivery of the Documents and the consummation of the transactions contemplated hereby and thereby for a period of time equal to the applicable statute of limitations.

	
6.

	
INDEMNIFICATION

	  	
6.1.

	
Indemnification by Sellers.  Subject to the terms and conditions of this Agreement, each Seller will indemnify and hold harmless each Purchaser Party, its Affiliates and their respective officers, directors, managers, members, employees, agents, successors and permitted assigns (collectively, the “Purchaser Indemnified Parties”) against and in respect of any Damages suffered or incurred by any Purchaser Indemnified Party based upon or arising out of, directly or indirectly, the following:

	  	
6.1.1.

	
Breach of Representations or Warranties.  Any breach or inaccuracy of any representation or warranty of such Seller in this Agreement or in any Related Agreement (except as it relates to an Excluded Claim for which there shall be no indemnification);

	  	
6.1.2.

	
Breach of Covenants.  Any breach of any covenant or agreement of such Seller in this Agreement or in any Related Agreement; and

 

  

38

  

 

	  	
6.1.3.

	
Excluded Liabilities.  The Excluded Liabilities.

 

	  	
6.2.

	
Indemnification by Purchaser.  Subject to the terms and conditions of this Agreement, the Purchaser Parties will indemnify and hold harmless each Seller and each of their respective Affiliates and their respective officers, directors, managers, members, employees, agents, successors and permitted assigns (collectively, the “Seller Indemnified Parties”) against and in respect of any Damages suffered or incurred by any Seller Indemnified Party based upon or arising out of, directly or indirectly, the following:

	  	
6.2.1.

	
Breach of Representation or Warranty.  Any breach or inaccuracy of any representation or warranty of either Purchaser Party in this Agreement or in any Related Agreement;

	  	
6.2.2.

	
Breach of Covenant.  Any breach of any covenant or agreement of either Purchaser Party in this Agreement or in any Related Agreement; or

	  	
6.2.3.

	
Assumed Liabilities.  The failure of either Purchaser Party to perform its obligations with respect to the Assumed Liabilities.

	  	
6.3.

	
Inter-Party Claims.  In order for a Purchaser Indemnified Party or a Seller Indemnified Party (each, an “Indemnified Party”) to be entitled to any indemnification pursuant to this Section 6, the applicable Indemnified Party shall notify the other Party from whom such indemnification is sought (the “Indemnifying Party”) in writing promptly after occurrence of the event giving rise to such Indemnified Party’s claim for indemnification, specifying in reasonable detail the basis of such claim, that the Indemnified Party has accrued or reasonably anticipates that it will have to pay or accrue Damages, the amount of such Damages or reasonably anticipated Damages, and the specific representation, warranty or covenant on which such claim is based; provided, however, that failure to give such notification shall not affect the indemnification provided hereunder except to the extent the Indemnifying Party actually shall have been prejudiced as a result of such failure or the indemnification obligations are materially increased as a result of such failure.  The Indemnified Party and its Affiliates shall thereupon give the Indemnifying Party reasonable access during normal business hours to the books, records and assets of the Indemnified Party and its Affiliates which evidence or support such claim or the act, omission or occurrence giving rise to such claim.  If the Indemnifying Party disputes its liability with respect to any such claim, the Indemnifying Party and the Indemnified Party shall proceed to negotiate a resolution of such dispute and, if not resolved through negotiations, such dispute shall, subject to the terms of this Agreement, be resolved by arbitration in accordance with Section 7.17.

	  	
6.4.

	
Third Party Claims.

	  	
6.4.1.

	
Notice.  In order for an Indemnified Party to be entitled to any indemnification provided for under this Agreement in respect of, arising out of or involving a claim made by any Person (other than by an Indemnified Party, which claims are addressed in Section 6.3) against the Indemnified Party (a “Third Party Claim”), such Indemnified Party must notify the Indemnifying Party in writing of the Third Party Claim (which notice shall specify in reasonable detail the events giving rise to such Third Party Claim, that the Indemnified Party has accrued or reasonably anticipates that it will have to pay or accrue Damages, the amount of such Damages or reasonably anticipated Damages, and the specific representation, warranty or covenant on which such claim is based) promptly after receipt by such Indemnified Party of notice of the Third Party Claim; provided, however, that failure to give such notification shall not affect the indemnification provided hereunder except to the extent the Indemnifying Party actually shall have been prejudiced as a result of such failure or the indemnification obligations are materially increased as a result of such failure.  Thereafter, the Indemnified Party shall deliver to the Indemnifying Party, promptly following the Indemnified Party’s receipt thereof, copies of all notices and documents (including court papers) received by the Indemnified Party relating to the Third Party Claim.

 

  

39

  

 

	  	
6.4.2.

	
Defense of Third Party Claim.  If a Third Party Claim is made, the Indemnifying Party shall be entitled to participate in the defense thereof.  If within ninety (90) days of the date notice is delivered to the Indemnifying Party with respect to such Third Party Claim, the Indemnifying Party acknowledges in writing its obligation to indemnify the Indemnified Party against any and all Damages that may result from a Third Party Claim the Indemnifying Party also may assume the defense of such Third Party Claim with counsel selected by the Indemnifying Party and reasonably satisfactory to the Indemnified Party, provided that to the extent the Indemnifying Party fails to acknowledge its obligation to indemnify the Indemnified Party within the time frame specified above, then the Indemnified Party immediately shall have the right to assume or re-assume the defense of such Third Party Claim.  Subject to the foregoing, should the Indemnifying Party so elect to assume the defense of a Third Party Claim, the Indemnifying Party shall not be liable to the Indemnified Party for any legal or other expenses subsequently incurred by the Indemnified Party in connection with the defense thereof, except to the extent the Indemnified Party reasonably determines there are defenses that are reasonably likely to conflict with the defenses being asserted by the Indemnifying Party.

	  	
6.4.3.

	
Participation by Indemnified Party.  If the Indemnifying Party assumes such defense, the Indemnified Party shall have the right to participate in the defense thereof and to employ counsel, at its own expense, separate from the counsel employed by the Indemnifying Party, it being understood and agreed that the Indemnifying Party shall control such defense, unless the employment of such counsel shall have been specifically authorized in writing by the Indemnifying Party or the Indemnified Party, after taking into consideration the advice of outside counsel, reasonably determines representation by counsel to the Indemnifying Party of both the Indemnifying Party and such Indemnified Party would be reasonably likely to present such counsel with a conflict of interest.  Notwithstanding the foregoing, the Indemnifying Party shall be liable for the fees and expenses of one (1) outside counsel and any local counsel reasonably necessary to defend such Third Party Claim (and not any fees and expenses allocated to any internal counsel) employed by the Indemnified Party for any period during which the Indemnifying Party has not assumed the defense thereof; which fees and expenses shall constitute indemnifiable Damages for purposes of this Section 6.

	  	
6.4.4.

	
Defense or Prosecution of Third Party Claim.  If the Indemnifying Party chooses to defend or prosecute a Third Party Claim, all the Indemnified Parties shall reasonably cooperate in the defense or prosecution thereof.  Such cooperation shall include the retention and (upon the Indemnifying Party’s request) the provision to the Indemnifying Party of records and information that are reasonably relevant to such Third Party Claim, and making employees and representatives available on a mutually convenient basis during normal business hours to provide additional information and explanation of any material provided hereunder.

	  	
6.4.5.

	
No Admission of Liability.  Whether or not the Indemnifying Party assumes the defense of a Third Party Claim, the Indemnified Party shall not admit any liability with respect to, settle, compromise or discharge, such Third Party Claim without the Indemnifying Party’s prior written consent.  If the Indemnifying Party assumes the defense of a Third Party Claim, the Indemnified Party shall agree to any settlement, compromise or discharge of a Third Party Claim the Indemnifying Party reasonably may recommend and that by its terms (i) obligates the Indemnifying Party to pay the full amount of Damages in connection with such Third Party Claim and (ii) releases the Indemnified Party and its Affiliates completely in connection with such Third Party Claim with no admission of liability.

	  	
6.5.

	
Limitations.  The rights to indemnification under Section 6.1 and Section 6.2 are subject to the following limitations:

 

  

40

  

 

	  	
6.5.1.

	
Cap.  Except with respect to a claim based on fraud or intentional misconduct, recovery by the Purchaser Indemnified Parties or the Seller Indemnified Parties with respect to all claims under Section 6.1 or 6.2 shall be limited to an amount equal to the Cash Consideration.

	  	
6.5.2.

	
Amount of Damages.  The amount of any Damages incurred by an Indemnified Party shall be reduced by any amount recovered by such Indemnified Party with respect thereto under any insurance coverage (net of any increased premiums and additional costs and expenses incurred in connection with the insurance claims), from any other Person alleged to be responsible therefor or from any Tax benefits actually received by such Party.

	  	
6.5.3.

	
Sole Remedy.  Except only with respect to claims based on fraud or intentional misconduct and for a suit for equitable relief, the rights and remedies of the Indemnified Parties as provided in this Article VI will be the sole and exclusive remedy of the Indemnified Parties with respect to all Documents and no other remedy, whether in contract, tort or otherwise, or any right of rescission, with respect to any Document shall be had, all of which each Party hereby expressly waives.

	  	
6.5.4.

	
Mitigation.  Each Indemnified Party shall use its reasonable efforts to mitigate any Damages which are the subject of claims hereunder, provided, the failure of any Indemnified Party to mitigate any Damages shall not relieve the Indemnifying Party of its obligations hereunder except to the extent it shall have been prejudiced by such failure.

	
7.

	
MISCELLANEOUS

	  	
7.1.

	
Further Assurances.  Each of the Parties hereto hereby agrees to execute all such documents and do all such filing, recording, publishing and other acts as any other Party deems appropriate to comply with the requirements of Law in connection with the consummation of the transactions contemplated hereby and by the Related Agreements or the performance by each Party of its respective obligations under any Document.

	  	
7.2.

	
Notices.  All notices hereunder shall be in writing (which includes notice by telecopy or e-mail) and shall be delivered to each Party at the address for such Person set forth on Schedule 7.2 hereto. Changes to any such address shall be delivered to each of the Parties hereto in the manner set forth in this Section 7.2. Notices are deemed effective if given by (a) telecopy or e-mail when such telecopy or e-mail, as applicable, is transmitted to the telecopy number or e-mail address set forth herein and confirmation of receipt of such telecopy or e-mail, as applicable, at the appropriate address has been received by the sender, (b) mail, 48 hours after such communication is deposited in the mail, certified or registered with return receipt requested, postage prepaid, addressed as aforesaid or (c) any other means, when delivered to the addressee at the address specified herein.

	  	
7.3.

	
Amendments with Consent of Parties.  Amendments may be made to this Agreement from time to time by the agreement of the Parties.  All amendments shall be in writing and shall be executed by each of Parties hereto.

	  	
7.4.

	
Complete Agreement; Incorporation by Reference.  This Agreement constitutes the complete and exclusive statement of the agreement among the Parties hereto and supersedes all prior written and oral statements and other any prior representation, statement, condition or warranty.

	  	
7.5.

	
Section Titles.  The headings in this Agreement are inserted as a matter of convenience only, and do not define, limit or otherwise describe or proscribe the scope of this Agreement or the intent of the provisions hereof.

	  	
7.6.

	
Binding Provisions.  This Agreement is binding upon and inures to the benefit of the Parties hereto and their respective heirs, executors administrators, personal and legal representatives, successors and permitted assigns. Each of the Parties hereby agrees that this Agreement and the rights granted hereunder are personal to each of such Parties and may not be assigned or transferred by any of such Parties without the prior written consent of the other Parties.  Notwithstanding the foregoing, no such consent shall be required for any assignment to any affiliate of any Party, provided (a) notice of such assignment is delivered by the applicable Party to the other Party in accordance with the provisions of Section 7.2 above and (b) Parent hereby acknowledges and agrees that none of its obligations under any Document may be assigned.

 

  

41

  

 

	  	
7.7.

	
No Waiver, Remedies Cumulative.  No delay or failure on the part of any Party hereto to exercise any right in this Agreement shall operate as a waiver of such right.

	  	
7.8.

	
Severability of Provisions.  Each provision of this Agreement shall be considered severable from the other provisions of this Agreement and if, for any reason, any provision of this Agreement is determined by a court of competent jurisdiction to be invalid or unenforceable under any existing or future law, such invalidity shall not impair the operation of or affect those portions of this Agreement which are valid, and the same shall remain in full force and effect.

	  	
7.9.

	
Governing Law; Jurisdiction.  This Agreement shall be governed by and construed in accordance with the laws and decisions of the State of Colorado, including the conflicts of laws provisions thereof, except to the extent such conflict of laws provisions would require the laws of another state to apply.

	  	
7.10.

	
Counterparts.  This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which, when taken together, shall constitute one and the same document.  The signature of any Party to any counterpart shall be deemed a signature to, and may be appended to, any other counterpart to form a complete copy of this Agreement.  Signatures by facsimile or electronic mail are acceptable, provided an original signature page is delivered to the other Parties hereto within 10 Business Days after receipt of the facsimile or electronic mail copy thereof.

	  	
7.11.

	
Time of the Essence.  With regard to all dates and time periods set forth or referred to in this Agreement, time is of the essence.

	  	
7.12.

	
No Third Party Beneficiaries.  The terms and provisions of this Agreement are intended solely for the benefit of the Parties hereto and their respective successors and permitted assigns, and it is not the intention of the Parties to confer third party beneficiary rights upon any other Person.

	  	
7.13.

	
Expenses .  Except as otherwise expressly provided in this Agreement, whether or not the transactions contemplated hereby are consummated, each Party will pay its own costs and expenses incurred in connection with the negotiation, execution and closing of each Document and the transactions contemplated hereby and thereby.  The applicable Seller shall pay its share of any fees and expenses in connection with the prepayment, release, satisfaction or removal of any Liens affecting the portion of the Acquired Assets owned by such Seller.

	  	
7.14.

	
Announcement.  No Party will issue any press release or otherwise make any public statement with respect to this Agreement or the transactions contemplated hereby prior to the Closing without the prior consent of the other Parties, except as may be required by applicable Law.  Notwithstanding anything in this Section 7.14 to the contrary, to the extent practicable, the Parties consult with each other before issuing, and provide each other a reasonable prior opportunity to review and comment upon, any such press release or other public statements with respect to this Agreement and the transactions contemplated hereby, whether or not required by applicable Law.

 

  

42

  

 

	  	
7.15.

	
Non-Reliance.  Each Purchaser Party acknowledges and agrees that no Seller has made or is making any representations or warranties whatsoever regarding the subject matter of this Agreement, express or implied, except as provided in Section 5.1 of this Agreement and the Disclosure Schedules.  Sellers acknowledge and agree that no Purchaser Party has made and is not making any representations or warranties whatsoever regarding the subject matter of this Agreement, express or implied, except as provided in Section 5.2 of this Agreement.

	  	
7.16.

	
Construction.  Neither this Agreement nor any uncertainty or ambiguity herein shall be construed or resolved against either Purchaser Party or any Seller, whether under any rule of construction or otherwise.  No Party to this Agreement shall be considered the draftsman.  On the contrary, this Agreement has been reviewed, negotiated and accepted by all Parties and their respective attorneys and shall be construed and interpreted according to the ordinary meaning of the words so as fairly to accomplish the purposes and intentions of all the Parties.

	  	
7.17.

	
Arbitration. Any controversy or claim arising out of or related to this Agreement, or any breach hereof, shall be settled by arbitration which shall be administered by the Judicial Arbiter Group, Inc. or another private arbitration/mediation firm mutually acceptable to the Parties; such arbitration shall be conducted in accordance with the commercial arbitration rules of the American Arbitration Association or such other commercial arbitration/mediation rules acceptable to the Parties and the private arbitration/mediation firm.  Arbitration shall be before a single neutral arbitrator, who shall be an attorney who has practiced in the area of mining law for at least fifteen years or a retired judge of the district court or an appellate court level and shall be held in Denver, Colorado, and shall be governed by the laws of the state of Colorado.  Judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction thereof.  Any demand for arbitration must be made prior to the date when the institution of legal or equitable proceedings based on the underlying claim would be barred by the applicable statute of limitations.  The arbitrator shall award attorneys' fees and costs to the prevailing party.  A list of three (3) arbitrators acceptable to the Parties is attached as Schedule 7.17.

[Signature Page to Follow]

IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed and delivered as of the Effective Date.

	  	
PURCHASER PARTIES:

	  	  	  
	  	
Aurora Gold Corporation, a Delaware corporation

	  	  	  
	  	
By:

	
/signed/ Michael Montgomery

	  	  	
Michael Montgomery, Chief Operating Officer

	  	  	  
	  	
AGC Resources LLC, a Colorado limited liability company

	  	  	  
	  	
By:

	
/signed/ Michael Montgomery

	  	  	
Michael Montgomery, Manager

	  	  	  
	  	  	  
	  	
SELLERS:

	  	  	  
	  	
Global Minerals Ltd., a corporation incorporated under the laws of British Columbia, Canada

	  	  	  
	  	  	  
	  	
By:

	
/signed/ George W. Heard

	  	  	
George W. Heard, President

	  	  	  
	  	
Mount Royale Ventures, LLC, a Colorado limited liability company

	  	  	  
	  	
By:

	
/signed/ Richard T. Heard

	  	  	
Richard T. Heard, Manager

	  	  	  
	  	  	  
	  	
Golden Rex Mining Company, a Colorado corporation

	  	  	  
	  	
By:

	
/signed/ Richard T. Heard

	  	  	
Richard T. Heard, President

 

  

43

  

Schedule 1(ii)

Excluded Assets

Excluded Assets means the water rights under Water Court adjudication 85CW117 together with 20 shares of the Left Hand Ditch Company, which were to be conveyed to Subsidiary under the June 1, 2010 Agreement, but which were never received by Subsidiary.

  

44

  

Schedule 3(b)(v)

Litigation

Mark Steen, in his capacity as an officer of Mi Vida Enterprises, Inc., Gold Hill Mines, Inc. and Southern Cross Prospecting Company, through his attorney, Thomas Finch, has initiated litigation against Global Minerals, Ltd. The various legal actions filed in connection with this litigation are attached hereto.

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