Document:

Untitled Document

 

Exhibit 10.3

 

PROPERTY OPTION AGREEMENT

 

THIS AGREEMENT made
and entered into as of the 15 day of January 2010

 

	
BETWEEN:

	
MinQuest Inc., a
company having a mailing address at 4235 Christy Way, Reno, Nevada,
89519, U.S.A.

	
 

	
 

	
 

	
(herein called the
“Optionor”)

 

OF THE FIRST PART

 

	
AND:

	
Star Gold
Corporation , a company having an office at 6240 East Seltice Way,
Suite C, Post Falls, Idaho, 83854, USA

	
 

	
 

	
 

	
(herein called the
“Optionee”)

 

OF THE SECOND PART

 

WHERAS the Optionor
has represented that it is the sole recorded and beneficial owner
in and to the property called the Longstreet Project (the
“Property) described in Schedule “A” attached
hereto;

 

AND WHEREAS the
Optionor, subject to the Net Smelter Royalty reserved to the
Optionor, now wishes to grant to the Optionee the exclusive right
and option to acquire an undivided 100% right, title and interest
in and to the Property on the terms and conditions hereinafter set
forth;

 

NOW THEREFORE THIS
AGREEMENT WITNESSETH THAT in consideration of the premises, the
mutual covenants herein set forth and the sum of One Dollar ($1.00)
of lawful money of U.S. currency now paid by the Optionee to the
Optionor (the receipt whereof is hereby acknowledged), the Parties
hereby mutually covenant and agree as follows:

 

	
1.

	
Definitions

 

 The following
words, phrases and expressions shall have the following
meanings:

 

	
 

	
(a)

	
“After
Acquired Properties” means any and all mineral interests
staked, located, granted or acquired by or on behalf of either of
the parties hereto during the currency of this Agreement which are
located, in the whole or in part, within one (1) mile of the
existing perimeter of the Property;

 

	
 

	
(b)

	
“Exchange”
means any stock Exchange;

 

1

 

 

	
 

	
(c)

	
“Expenditures”
includes all direct or indirect expenses [net of government
incentives and not including payments to the Optionor pursuant to
section 4, paragraphs (a), (b)(ii), (c)(ii), (d)(ii), (e)(ii),
(f)(ii), (g)(ii), (h)(ii), (i)(ii), (j)(ii), and (k)(ii) hereof ]
of or incidental to Mining Operations. The certificate of the
Controller or other financial officer of the Optionee, together
with a statement of Expenditures in reasonable detail shall be
prima facie evidence of such Expenditures; the parties hereto agree
that Property payments and Property expenditures are separate
payments as outlined in paragraph 4;

 

	
 

	
(d)

	
“Facilities”
means all mines and plants, including without limitation, all pits,
shafts, adits, haulageways, raises and other underground workings,
and all buildings, plants, facilities and other structures,
fixtures and improvements, and all other property, whether fixed or
moveable, as the same may exist at any time in, or on the Property
and relating to the operator of the Property as a mine or outside
the Property if for the exclusive benefit of the Property
only;

 

	
 

	
(e)

	
“Force
Majeure” means an event beyond the reasonable control of the
Opionee that prevents or delays it from conducting the activities
contemplated by this Agreement other than the making of payments
referred to in Section 4 herein. Such events shall include but not
be limited to acts of God, war, insurrection, action of
governmental agencies reflecting a clear and marked instability in
government procedures unacceptable to both Option or and
Optionee;

 

	
 

	
(f)

	
“Mineral
Products” means the commercial end products derived from
operating the Property as a mine:

 

	
 

	
(g)

	
“Mining
Operations” includes:

 

	
 

	
(i)

	
every kind of work
done on or with respect to the Property by or under the direction
of the Optionee during the Option Period or pursuant to an approved
Work Program; and

  

	
 

	
(ii)

	
without limiting
the generality of the foregoing, including all work capable of
receiving assessment credits pursuant to the Mines and Minerals act
of Nevada and the work of assessment, geophysical, geochemical and
geological surveys, studies and mapping, investigating, drilling,
designing, examining equipping, improving, surveying, shaft
sinking, raising, cross-cutting and drifting, searching for,
digging, trucking, sampling, working and procuring minerals, ores
and metals, in surveying and bringing any mineral claims to lease
or patent, in doing all other work usually considered to be
prospecting, exploration, development, a feasibility study, mining
work, milling concentration, beneficiation or ores and
concentrates, as well as the separation and extraction of Mineral
Products and all reclamation, restoration and permitting
activities;

 

2

 

 

	
 

	
(h)

	
“Net Smelter
Royalty” means that Net Smelter Royalty as defined in
Schedule “B” attached hereto
(“NSR”);

 

	
 

	
(i)

	
“Option”
means the option granted by the Optionor to the Optionee to
acquire, subject to the NSR reserved to the Optionor, an undivided
100% right, title and interest in and to the Property as more
particularly set forth in Section 4;

 

	
 

	
(j)

	
“Option
Period” means the period from the date hereof to the date at
which the Optionee has performed its obligations to acquire its
100% interest in the Property as set out in Section 4 hereof, which
ever shall be the lesser period;

 

	
 

	
(k)

	
“Property”
means the mineral claims described in Schedule “A” and
any future claims included through item (a) above;

 

	
 

	
(l)

	
“Filing
Fees” means all fees, payments and expenses necessary to keep
the mineral claims in good standing with federal, state and local
government entities;

 

	
 

	
(m)

	
“Work
Program” means a program of work reasonably acceptable to
both parties in respect of a particular Property, contained in a
written document setting out in reasonable detail;

  

	
 

	
(i)

	
An outline of the
Mining Operations proposed to be undertaken and conducted on the
Property, specifically stating the period of time during which the
work contemplated by the proposed program is to be done and
performed;

 

	
 

	
(ii)

	
The estimated cost
of such Mining Operations including a proposed budget providing for
estimated monthly cash requirements in advance and giving
reasonable details; and

 

	
 

	
(iii)

	
The identity and
credentials of the person or persons undertaking the Mining
Operations so proposed if not the Optionor, reasonably acceptable
to both parties hereto.

 

	
2.

	
Headings

 

	
 

	
Any heading,
caption or index hereto shall not be used in any way in construing
or interpreting any provision hereof.

 

3

 

 

	
3.

	
Singular, Plural

 

	
 

	
Whenever the
singular or masculine or neuter is used in this Agreement, the same
shall be construed as meaning plural or feminine or body politic or
corporate or vice versa, as the context so requires.

 

	
4.

	
Option

 

	
 

	
The Optionor hereby
grants to the Optionee the sole and exclusive right to lease
(“Option”) the Property under the terms as
follows:

 

	
(a)

	
At signing, the
Optionee paying the sum of $20,000 USD to the Optionor by way of
cash, issue 25,000 shares of stock, 25000 stock options based on
“Fair Market Price” and reimburse all holding costs and
expenses of location of mining claims, such expenses to be
identified in Schedule “C”;

 

	
(b)

	
On or before the
First Anniversary

 

	
 

	
(i)

	
The Optionee
incurring Expenditures of $200,000 USD on the
property;

 

	
 

	
(ii)

	
The Optionee paying
$20,000 USD and issuing 25,000 shares of stock and 25000 stock
options based on “Fair Market Price”  to the
Optionor;

 

	
(c)

	
On or before Second
Anniversary

 

	
 

	
(i)

	
The Optionee
incurring Expenditures of $250,000 USD on the Property in addition
to the expenditures referred to in clause (b)(i);

 

	
 

	
(ii)

	
The Optionee paying
$20,000 U.S and issuing 25,000 shares of stock and 25000 stock
options based on “Fair Market Price”  to the
Optionor;

 

	
(d)

	
On or before Third
Anniversary

 

	
 

	
(i)

	
The Optionee
incurring Expenditures of $350,000 USD on the Property in addition
to the expenditures referred to in clauses (b)(i) and (c)(i)
hereof; and

 

	
 

	
(ii)

	
The Optionee paying
$30,000 USD and issuing 25,000 shares of stock and 25000 stock
options based on “Fair Market Price”  to the
Optionor;

 

4

 

 

	
(e)

	
On or before Fourth
Anniversary

 

	
 

	
(i)

	
The Optionee
incurring Expenditures of $450,000 USD on the Property in addition
to the expenditures referred to in clauses (b)(i), (c)(i) and
(d)(i) hereof; and

 

	
 

	
(ii)

	
The Optionee paying
$30,000 USD and issuing 25,000 shares of stock and 25000 stock
options based on “Fair Market Price” to the
Optionor;

 

	
(f)

	
On or before the
Fifth Anniversary

 

	
 

	
(i)

	
The Optionee
incurring Expenditures of $550,000 USD on the Property in addition
to the expenditures referred to in clauses (b)(i), (c)(i), (d)(i)
and (e)(i) hereof;

 

	
 

	
(ii)

	
The Optionee paying
$50,000 USD to the Optionor and issuing 25,000 shares of stock and
25000 stock options based on “Fair Market
Price”;

 

	
(g)

	
On or before the
Sixth Anniversary

 

	
 

	
(i)

	
The Optionee
incurring Expenditures of $750,000 USD on the Property in addition
to the expenditures referred to in clauses (b)(i), (c)(i), (d)(i)
and (e)(i) and (f)(i) hereof

 

	
 

	
(ii)

	
The Optionee paying
$50,000 USD to the Optionor and issuing 25,000 shares of stock and
25000 stock options based on “Fair Market Price”
 to the Optionor;

 

	
(h)

	
On or before the
Seventh Anniversary

 

	
 

	
(i)

	
The Optionee
incurring Expenditures of $1,000,000 USD on the Property in
addition to the expenditures referred to in clauses (b)(i), (c)(i),
(d)(i), (e)(i), (f)(i) and (g)(i) hereof;

 

	
 

	
(ii)

	
The Optionee paying
$50,000 USD to the Optionor; and issuing 25,000 shares of stock and
25000 stock options based on “Fair Market Price” to the
Optionor.  Following which the Optionee shall receive from
Optionor a quitclaim for 100% interest in and to the property with
the exception of a retained 3% NSR to the Optionor as defined in
Schedule B.

 

	
(i)

	
The Optionor and
Optionee understand and confirm that all Expenditures incurred in a
particular period, including any excess in the amount of
Expenditures required to be incurred to maintain the Option during
such period, shall be carried over and included in the aggregate
amount of Expenditures for the subsequent period, but not to exceed
more than three (3) consecutive years.

 

5

 

 

	
(j)

	
Notwithstanding
paragraphs (b)(i), (c)(i), (d)(i), (e)(i), (f)(i), (g)(i), (h)(i),
if the Optionee has not incurred the requisite Expenditures to
maintain its option in good standing prior to the anniversary of
any given year, the Optionee may pay to the Optionor within 60 days
following the expiry of such period, the amount of the deficiency
and such amount shall thereupon be deemed to have been Expenditures
incurred by the Optionee during such period.

 

	
(k)

	
The doing of any
act or the incurrence of any cash payments by the Optionee shall
not obligate the Optionee to do any further acts or make any
further payments with the exception of fees and expenses to keep
said property in good standing as per paragraph 8b.

 

	
6.

	
Mining Operations during
Option

 

	
 

	
During the Option
Period, the Optionor may provide its mineral exploration expertise
on the Property, on a consultation basis for and on behalf of the
Optionee, at the election of the Optionee.  However, the
Optionee has the exclusive right to determine what Expenditures and
Mining Operations it will perform, when they will be performed, and
by whom. If the Optionee elects to use the mineral expertise and
consulting services of the Optionor, then the Optionor shall
invoice for time for consulting services and related travel
expenses from time to time and the prompt payment of such invoices
when due shall constitute a portion of Expenditures by the Optionee
as contemplated under Section 4 hereof.

 

	
 

	
During the currency
of this Agreement, the Optionee, its servants, agents and workmen
and any persons duly authorized by the Optionee, shall have the
right of access to and from and to enter upon and take possession
of and prospect, explore and develop the Property in such manner as
the Optionee in its sole discretion may deem advisable and shall
have the right to remove and ship therefrom ores, minerals, metals,
or other products recovered in any manner therefrom.

 

	
7.

	
Assignment

 

	
 

	
During the Option
Term, both parties shall have the right to sell, transfer, or
assign its interest in this Agreement or its right or interest in
the Property. It will be a condition of any assignment under this
Agreement that such assignee shall agree in writing to be bound by
the terms of this Agreement applicable to the
assignor.

 

6

 

 

	
8.

	
Termination

 

	
 

	
This Agreement
shall forthwith terminate in circumstances where:

 

	
 

	
(a)

	
The Optionee shall
fail to comply with any of its obligations hereunder, subject to
Force Majeure, and within 30 days of receipt by the Optionee of
written notice from the Optionor of such default, the Optionee has
not:

 

	
 

	
(i)

	
cured such default,
or commenced proceedings to cure such default and prosecuted same
to completion without undue delay; or

 

	
 

	
(ii)

	
given the Optionor
notice that it denies that such default has occurred.

 

	
 

	
In the event that
the Optionee gives notice that it denies that a default has
occurred, the Optionee shall not be deemed to be in default until
the matter shall have been determined finally through such means of
dispute resolution as such matter has been subjected to by either
party so long as the Optionee continues to maintain the property in
good standing with all government entities; or

 

	
 

	
(b)

	
The Optionee gives
notice of termination to the Optionor, which it shall be at liberty
to do at any time after the execution of this Agreement. If and
when the Optionee elects to terminate this Agreement, or terminate
one of the projects comprising the Property, at such time the
Property or the specific project will be returned to the Optionor
and all claim fees, payments and expenses will be paid in order to
maintain the property in good standing for one year after
termination.

  

	
 

	
Upon the
termination of this Agreement under this Section 8, the Optionee
shall cease to be liable to the Optionor in debt, damages, or
otherwise, other than to pay the claim fees as described in
paragraph (b) of this Section 8 and all liabilities referred to in
Section 11.

 

	
 

	
Upon termination of
this Agreement under this Section 8, the Optionee shall return the
Property, including all property within the designated boundary of
the area of interest, to the Optionor. The Optionee shall vacate
the Property within a reasonable time after such termination and
relinquishment, but shall have the right of access to the Property
for a period of six months thereafter for the purpose of removing
its chattels, machinery, equipment and fixtures.

 

	
9.

	
Representations and Covenants of the
Optionor

 

	
 

	
The Optionor
represents and covenants to and with the Optionee as
follows:

 

	
 

	
(a)

	
The Optionor is a
company duly organized validly existing and in good standing under
the laws of Nevada;

 

	
 

	
(b)

	
The Optionor has
full power and authority to carry on its business and to enter into
this Agreement and any agreement or instrument referred to or
contemplated by this Agreement;

 

7

 

 

	
 

	
(c)

	
Neither the
execution and delivery of this Agreement, nor any of the agreements
referred to herein or contemplated hereby, nor the consummation of
the transactions hereby contemplated hereby, nor the consummation
of the transactions hereby contemplated conflict with, result in
the breach of or accelerate the performance required by, any
agreement to which it is a party;

 

	
 

	
(d)

	
The execution and
delivery of this Agreement and the agreements contemplated hereby
will not violate or result in the breach of the laws of any
jurisdiction applicable or pertaining thereto or of its constating
documents;

 

	
 

	
(e)

	
The Agreement
constitutes a legal, valid and binding obligation of the
Optionor;

 

	
 

	
(f)

	
The Property is
accurately described in Schedule “A”, is in good
standing under the laws of the jurisdiction in which it is located
and is free and clear of all liens, charges and
encumbrances;

 

	
 

	
(g)

	
The Optionor is the
sole recorded and beneficial owner of the Property and has the
exclusive right to enter into this Agreement and all necessary
authority to transfer its interest in the Property in accordance
with the terms of this Agreement;

 

	
 

	
(h)

	
No Person, firm or
corporation has any proprietary or possessorty interest in the
Property other than the Optionor, and no person, firm or
corporation is entitled to any royalty or other payment in the
nature of rent or royalty on any minerals, ores, metals or
concentrates or any other such products removed from the Property
other than the government of the state of Nevada pursuant to
statute; notwithstanding any Federal, State or County royalties or
net proceeds tax derived from mining operations.

 

	
 

	
(i)

	
Upon request by the
Optionee, and at the sole cost of the Optionee, the Optionor shall
deliver or cause to be delivered to the Optionee copies of all
available maps and other documents and data in its possession
respecting the Property. Nothing will be withheld, hidden, or kept
from the Optionee; and

 

	
 

	
(j)

	
Subject to
performance by the Optionee of its obligations under Section 4,
during the Option Period, the Optionee will keep the Property in
good standing, free and clear of all liens, charges and
encumbrances, will carry out all Mining Operations on the Property
in a miner-like fashion if the Optionee elects to use the mining
expertise and consulting services of the Optionor, will obtain all
necessary licenses and permits as shall be necessary and will file
all applicable work up to the legal limits as assessment work under
the Mines and Mineral Act (Nevada)

 

8

 

 

	
10.

	
Representations and Covenants of the
Optionee

 

	
 

	
The Optionee
represents and covenants to and with the Optionor
that:

 

	
 

	
(a)

	
The Optionee is a
company duly organized validly existing and in good standing under
the laws of Nevada;

 

	
 

	
(b)

	
The Optionee has
full power and authority to carry on its business and to enter into
this Agreement and any agreement or instrument referred to or
contemplated by this Agreement;

 

	
 

	
(c)

	
Neither the
execution and delivery of this Agreement, nor any of the agreements
referred to herein or contemplated hereby, nor the consummation of
the transactions hereby contemplated conflict with, result in the
breach of or accelerate the performance required by, any agreement
to which it is a party;

 

	
 

	
(d)

	
The execution and
delivery of this Agreement and the agreements contemplated hereby
will not violate or result in the breach of the laws of any
jurisdiction applicable or pertaining thereto or of its constating
documents; and

 

	
 

	
(e)

	
This Agreement
constitutes a legal, valid and binding obligation of the
Optionee.

 

	
11.

	
Indemnity and Survival of
Representation

 

	
 

	
The representation
herein before set out are conditions on which the parties have
relied in entering into this Agreement and shall survive the
acquisition of any interest in the Property by the Optionee and
each of the parties will indemnify and save the other harmless from
all loss, damage, costs, actions and suits arising out of or in
connection with any breach of any representation, option, covenant,
agreement or condition made by them and contained in this
Agreement.

 

	
 

	
The Optionor agrees
to indemnify and save harmless the Optionee from any liability to
which it may be subject arising from any Mining Operations carried
out by the Optionor or at its direction on the Property. The
Optionee agrees to indemnify and save harmless the Optionor from
any liability to which it may be subject arising from any Mining
Operations carried out by the Optionee or at its direction on the
Property.

 

9

 

 

	
 

	
The Optionor agrees
to indemnify and save harmless the Optionee from any liability
arising from any and every kind of work done on or with respect to
the Property prior to the signing of this Agreement (the
“Prior Operations”). Without limiting the generality of
the foregoing, Prior Operations includes all work capable of
receiving assessment credits pursuant to The Mines and Minerals Act
of Nevada and the work of assessment, geophysical, geochemical and
geological surveys, studies and mapping, investigating, drilling,
designing, examining equipping, improving, surveying, shaft
sinking, raising, cross-cutting and drifting, searching for,
digging, trucking, sampling, working and procuring minerals, ores
and metals, in surveying and bringing any mineral claims to lease
or patent, in doing all other work usually considered to be
prospecting, exploration, development, a feasibility study, mining
work, milling, concentration, beneficiation of ores and
concentrates, as well as the separation and extraction of Mineral
Products and all reclamation, restoration and permitting
activities.

 

	
12.

	
Confidentiality

 

	
 

	
The parties hereto
agree to hold in confidence all information obtained in confidence
in respect of the Property or otherwise in connection with this
Agreement other than in circumstances where a party has an
obligation to disclose such information in accordance with
applicable securities legislation, in which case such disclosure
shall only be made after consultation with the other
party.

 

	
13.

	
Notice

 

	
 

	
All notices,
consents, demands and requests (in this Section 13 called the
“Communication”) required or permitted to be given
under this Agreement shall be in writing and may be delivered
personally sent by telegram, by fax or other electronic means or
may be forwarded by first class prepaid registered mail to the
parties at their addresses first above written. Any Communication
delivered personally or sent by fax or other electronic means
including email shall be deemed to have been given and received on
the second business day next following the date of sending. Any
Communication mailed as aforesaid shall be deemed to have been
given and received on the fifth business day following the date it
is posted, addressed to the parties at their addresses first above
written or to such other address or addresses as either party may
from time to time specify by notice to the other; provided,
however, that if there shall be a mail strike, slowdown or other
labor dispute which might effect delivery of the Communication by
mail, then the Communication shall be effective only if actually
delivered. For purposes of this agreement and as a definition of
address the Optionor’s email shall be defined as rrkern@charter.net and the
Optionor’s fax number is 775-746-0938. The Optionee’s
email shall be defined as admin.stargold@gmail.com and the
Optionee’s fax number is ________. Notice will be provided to
each party should their respective email address
change.

 

10

 

 

	
14.

	
Further Assurances

 

	
 

	
Each of the parties
to this Agreement shall from time to time and at all times do all
such further acts and execute and deliver all further deeds and
documents as shall be reasonably required in order to fully perform
and carry out the terms of this Agreement

 

	
15.

	
Entire Agreement

 

	
 

	
The parties hereto
acknowledge that they have expressed herein the entire
understanding and obligation of this Agreement and it is expressly
understood and agreed that no implied covenant, condition, term or
reservation, shall be read into this Agreement relating to or
concerning any matter or operation provided for herein

 

	
16.

	
Proper Law and Arbitration

 

	
 

	
This Agreement will
be governed by and construed in accordance with the laws of the
State of Nevada and the laws of the United States of America. The
parties hereto hereby irrevocably attorn to the jurisdiction of the
Courts of Nevada. All disputes arising out of or in connection with
this Agreement, or in respect of any defined legal relationship
associated therewith or derived therefrom, shall be referred to and
finally resolved by a sole arbitrator by arbitration under the
rules of The Arbitration Act of Nevada.

 

	
17.

	
Enurement

 

	
 

	
This Agreement will
ensure to the benefit of and be binding upon the parties hereto and
their respective successors and permitted assigns.

 

	
18.

	
After Acquired Properties

 

	
 

	
(i)

	
The parties
covenant and agree, each with the other, that any and all After
Acquired Properties shall be subject to the terms and conditions of
this Agreement and shall be added to and deemed, for the purposes
hereof, to be included in the Property. Any costs incurred by the
Optionor in staking, locating, recording or otherwise acquiring any
“After Acquired Properties” will be deemed to be Mining
Operations for which the Optionor will be entitled to
reimbursements as part of the Expenditures payable by the Optionee
hereunder.

 

	
 

	
(ii)

	
Any additional
claims agreed by the Optionee to be staked by the Optionor within
one (1) mile from the existing perimeter of the Property boundaries
shall form party of this Agreement. The Optionee will reimburse the
Optionor for the costs of staking the additional claims, unless the
Optionee does not elect to have the additional claims subject to
this Agreement.

 

11

 

 

	
19.

	
Default

 

	
 

	
Notwithstanding
anything in this Agreement to the contrary if any party (a
“Defaulting Party”) is in default of any requirement
herein set forth the party affected by such default shall give
written notice to the Defaulting Party specifying the default and
the Defaulting Party shall not lose any rights under this
Agreement, unless thirty (30) days after the giving of notice of
default by the affected party the Defaulting Party has failed to
take reasonable steps to cure the default by the appropriate
performance and if the Defaulting Party fails within such period to
take reasonable steps to cure any such default, the affected party
shall be entitled to seek any remedy it may have on account of such
default including, without limiting, termination of this
Agreement.

 

	
20.

	
Payment

 

	
 

	
All references to
monies herein shall be in US funds unless otherwise specified. The
Optionee shall make payments for the Expenditures incurred by the
Optionor no later than 30 days after the receipt of invoices
delivered by the Optionee to do any acts or make any payments
hereunder, and any act or payment or payments as shall be made
hereunder shall not be construed as obligating the Optionee to do
any further act or make any further payment or
payments.

 

	
21.

	
Supersedes Previous
Agreements

 

	
 

	
This Agreement
supersedes and replaces all previous oral or written agreements,
memoranda, correspondence or other communications between the
parties hereto relating to the subject matter hereof.

 

IN WITNESS WHEREOF the Parties hereto
have duly executed this Agreement effective as of the ___ day of
January, 2010

 

MinQuest
Inc.

 

	
Per:

	
 

	
 

	
 

	
Richard  Kern,
President

	
 

 

Star Gold
Corporation.

 

	
Per

	

	
 

	
 

	
Lindsay Gorrill,
President

	
 

 

12

 

 

SCHEDULE “A”

 

Sections 9, 10, 15
 and 16, T6N, R47E, MDB&M, Nye County, Nevada

 

	
CLAIM NAME

	
 

	
CLAIMANT’S
NAME

	
 

	
NMC NUMBER

	
 

	
 

	
 

	
 

	
 

	
Longstreet
1A

	
 

	
MinQuest
Inc.

	
 

	
799562

	
Longstreet
2A

	
 

	
MinQuest
Inc.

	
 

	
799563

	
Longstreet
3A

	
 

	
MinQuest
Inc.

	
 

	
799564

	
Longstreet
6A

	
 

	
MinQuest
Inc.

	
 

	
799565

	
Longstreet
7A

	
 

	
MinQuest
Inc.

	
 

	
799566

	
Longstreet
8A

	
 

	
MinQuest
Inc.

	
 

	
799567

	
Longstreet
9A

	
 

	
MinQuest
Inc.

	
 

	
799568

	
Longstreet
16A

	
 

	
MinQuest
Inc.

	
 

	
799569

	
Longstreet
13

	
 

	
MinQuest
Inc.

	
 

	
799570

	
Longstreet
32

	
 

	
MinQuest
Inc.

	
 

	
799571

	
Longstreet
34

	
 

	
MinQuest
Inc.

	
 

	
799572

	
Longstreet
4A

	
 

	
MinQuest
Inc.

	
 

	
836168

	
Longstreet
5A

	
 

	
MinQuest
Inc.

	
 

	
836169

	
Longstreet
8

	
 

	
MinQuest
Inc.

	
 

	
836170

	
Longstreet
10

	
 

	
MinQuest
Inc.

	
 

	
836171

	
Longstreet
10A

	
 

	
MinQuest
Inc.

	
 

	
836172

	
Longstreet
28

	
 

	
MinQuest
Inc.

	
 

	
836173

	
Longstreet
30

	
 

	
MinQuest
Inc.

	
 

	
836174

	
Longstreet
36

	
 

	
MinQuest
Inc.

	
 

	
836175

	
Longstreet
37

	
 

	
MinQuest
Inc.

	
 

	
836176

	
Longstreet
39

	
 

	
MinQuest
Inc.

	
 

	
836177

	
Longstreet
41

	
 

	
MinQuest
Inc.

	
 

	
836178

	
Longstreet
43

	
 

	
MinQuest
Inc.

	
 

	
836179

	
Longstreet
45

	
 

	
MinQuest
Inc.

	
 

	
836180

	
Longstreet
47

	
 

	
MinQuest
Inc.

	
 

	
836181

	
Longstreet
49

	
 

	
MinQuest
Inc.

	
 

	
836182

	
Longstreet
101

	
 

	
MinQuest
Inc.

	
 

	
836183

	
Longstreet
102

	
 

	
MinQuest
Inc.

	
 

	
836184

	
Longstreet
103

	
 

	
MinQuest
Inc.

	
 

	
836185

	
Longstreet
104

	
 

	
MinQuest
Inc.

	
 

	
836186

	
Longstreet
105

	
 

	
MinQuest
Inc.

	
 

	
836187

	
Longstreet
106

	
 

	
MinQuest
Inc.

	
 

	
836188

	
Longstreet
107

	
 

	
MinQuest
Inc.

	
 

	
836189

	
Longstreet
108

	
 

	
MinQuest
Inc.

	
 

	
836190

	
Longstreet
12

	
 

	
MinQuest
Inc.

	
 

	
843867

	
Longstreet
14

	
 

	
MinQuest
Inc.

	
 

	
843868

	
Longstreet
16

	
 

	
MinQuest
Inc.

	
 

	
843869

	
Longstreet
18

	
 

	
MinQuest
Inc.

	
 

	
843870

	
Longstreet
20

	
 

	
MinQuest
Inc.

	
 

	
843871

	
Longstreet
26

	
 

	
MinQuest
Inc.

	
 

	
843872

 

13

 

 

	
CLAIM NAME

	
 

	
CLAIMANT’S
NAME

	
 

	
NMC NUMBER

	
 

	
 

	
 

	
 

	
 

	
Longstreet
42

	
 

	
MinQuest
Inc.

	
 

	
843873

	
Longstreet
44

	
 

	
MinQuest
Inc.

	
 

	
843874

	
Longstreet
46

	
 

	
MinQuest
Inc.

	
 

	
843875

	
Longstreet
48

	
 

	
MinQuest
Inc.

	
 

	
843876

	
Longstreet
50

	
 

	
MinQuest
Inc.

	
 

	
843877

	
Longstreet
40

	
 

	
MinQuest
Inc.

	
 

	
851568

	
Longstreet
109

	
 

	
MinQuest
Inc.

	
 

	
855021

	
Longstreet
110

	
 

	
MinQuest
Inc.

	
 

	
855022

	
Longstreet
111

	
 

	
MinQuest
Inc.

	
 

	
855023

	
Longstreet
112

	
 

	
MinQuest
Inc.

	
 

	
855024

	
Longstreet
113

	
 

	
MinQuest
Inc.

	
 

	
855025

	
Longstreet
114

	
 

	
MinQuest
Inc.

	
 

	
855026

	
Longstreet
115

	
 

	
MinQuest
Inc.

	
 

	
855027

	
Longstreet
118

	
 

	
MinQuest
Inc.

	
 

	
851569

	
Longstreet
119

	
 

	
MinQuest
Inc.

	
 

	
851570

	
Longstreet
120

	
 

	
MinQuest
Inc.

	
 

	
851571

	
Longstreet
121

	
 

	
MinQuest
Inc.

	
 

	
851572

	
Longstreet
122

	
 

	
MinQuest
Inc.

	
 

	
851573

	
Longstreet
123

	
 

	
MinQuest
Inc.

	
 

	
851574

	
Longstreet
124

	
 

	
MinQuest
Inc.

	
 

	
851575

 

 

 

 

 

 

 

 

 

 

14

 

 

SCHEDULE “B”

 

“Net Smelter
Return” shall mean the aggregate proceeds received by the
Optionee from time to time from any smelter or other purchaser from
the sale of any ores, concentrates, metals or any other material of
commercial value produced by and from the Property after deducting
from such proceeds the following charges only to the extent that
they are not deducted by the smelter or other purchaser in
computing the proceeds:

 

	
 

	
(a)

	
The cost of
transportation of the ores, concentrates or metals from the
Property to such smelter or other purchaser, including related
insurance;

 

	
 

	
(b)

	
Smelting and
refining charges including penalties; and

 

The Optionee shall
reserve and pay to the Optionor a NSR equal to three (3%) percent
of Net Smelter Return.

 

Payment of NSR
payable to the Optionor hereunder shall be made quarterly within
thirty (30) days after the end of each calendar quarter during
which the Optionee receives Net Smelter Returns in USD dollars or
in kind bullion at the discretion of the Optionor. Within (60) days
after the end of each calendar quarter for which the NSR for such
year shall be audited by the Optionee and any adjustments in the
payments of NSR to the Optionor shall be made forthwith after
completion of the audit. All payments of NSR to the Optionor for a
calendar year shall be deemed final and in full satisfaction of all
obligations of the Optionee in respect thereof if such payments or
the calculations thereof are not disputed by the Optionor of the
same audited statement. The Optionee shall maintain accurate
records relevant to the determination of the NSR and the Optionor
or its authorized agent, shall be permitted the right to examine
such records at all reasonable times.

 

 

 

 

 

 

 

 

 

 

 

15

 

 

SCHEDULE “C”

 

	
BLM claim filing fees
2009 (60 x $140)

	
 

	
$

	
8,400.00

	
 

	
 

	
 

	
 

	
 

	
 

	
County claim filing fees
2009 (60 x $10.50 + $4.00)

	
 

	
$

	
634.00

	
 

	
 

	
 

	
 

	
 

	
 

	
Total

	
 

	
$

	
9,034.00

	
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

16Untitled Document

 

Exhibit
10.4

 

AMENDMENT

TO

LONGSTREET PROPERTY OPTION
AGREEMENT

 

This Property
Option Agreement Amendment (the “Amendment”) is executed
this 10th day of
December. 2014 by and between MinQuest, Inc., a Nevada corporation
(“MinQuest”) and Star Gold
Corp., a Nevada corporation (“Star Gold”) (each a
“Party”
and together the “Parties”).

 

RECITALS

 

	
 

	
A.

	
MinQuest and Star
Gold entered into a Property Option Agreement (the
“Option
Agreement”), dated January 15, 2010, for the property
referred to in the Option Agreement as the “Longstreet
Property” (the “Property”);

 

	
 

	
B.

	
Section 4 of the
Option Agreement requires Star Gold to incur certain levels of
Expenditures on the Property, make certain cash payments to
MinQuest and issue to MinQuest certain numbers of options to
purchase Star Gold common stock (the “Options”), according to
the schedules set forth therein;

 

	
 

	
C.

	
The Parties now
desire to amend the Option Agreement to adjust the timing and
amounts of the required Expenditures, cash payments and option
grants required by Section 4 of the Option Agreement.

 

NOW, THEREFORE, in
consideration of the covenants, agreements, representations and
warranties set forth in this Amendment, the Parties hereby
covenant, agree, represent and warrant as follows.

 

AGREEMENT

 

	
1.

	
DEFINITIONS.

 

All capitalized
terms not defined in this Amendment shall have the meaning ascribed
to those terms in the Purchase Agreement.

 

	
2.

	
AMENDMENTS.

 

Section 4 of the
Option Agreement shall be amended to provide for the following
schedule for Star Gold to incur the listed Expenditures, make the
listed cash payments and grant the listed Options to
MinQuest:

 

	
 

	
(a)

	
Between January 16,
2014 and January 16, 2015 Star Gold shall:

 

	
 

	
(i)

	
incur Expenditures
on the Property (including any surplus Expenditures incurred prior
to January 15, 2014) of five hundred fifty thousand and no/100
dollars ($550,000.00); and

 

1

 

 

	
 

	
(ii)

	
make cash payments
to MinQuest (independent of any required cash payments made prior
to January 15, 2014) totaling fifty six thousand and no/100 dollars
($56,000.00); and

 

	
 

	
(iii)

	
grant MinQuest
twenty five thousand (25,000) Options (independent of any Options
previously granted) with an exercise price equal to the five (5)
day VWAP of Star Gold’s common stock ending on the day the
Options are granted (hereafter the “Fair Market
Price”).

 

	
 

	
(b)

	
Between January 17,
2015 and January 16, 2016 Star Gold shall:

 

	
 

	
(i)

	
incur Expenditures
on the Property (including any surplus Expenditures incurred prior
to January 17, 2015) of one hundred thousand and no/100 dollars
($100,000.00); and

 

	
 

	
(ii)

	
make cash payments
to MinQuest (independent of any required cash payments made prior
to January 17, 2015) totaling fifty six thousand and no/100 dollars
($56,000.00); and

 

	
 

	
(iii)

	
grant MinQuest
twenty five thousand (25,000) Options (independent of any Options
previously granted) to be exercised at the Fair Market
Price.

 

	
 

	
(c)

	
Between January 17,
2016 and January 16, 2017 Star Gold shall:

 

	
 

	
(i)

	
incur Expenditures
on the Property (including any surplus Expenditures incurred prior
to January 17, 2016) of one hundred fifty thousand and no/100
dollars ($150,000.00); and

 

	
 

	
(ii)

	
make cash payments
to MinQuest (independent of any required cash payments made prior
to January 17, 2016) totaling fifty six thousand and no/100 dollars
($56,000.00); and

 

	
 

	
(iii)

	
grant MinQuest
twenty five thousand (25,000) Options (independent of any Options
previously granted) to be exercised at the Fair Market
Price.

 

	
 

	
(d)

	
Between January 17,
2017 and January 16, 2018 Star Gold shall:

 

	
 

	
(i)

	
incur Expenditures
on the Property (including any surplus Expenditures incurred prior
to January 17, 2017) of three hundred thousand and no/100 dollars
($300,000.00); and

 

	
 

	
(ii)

	
make cash payments
to MinQuest (independent of any required cash payments made prior
to January 17, 2017) totaling forty thousand and no/100 dollars
($40,000.00); and

 

	
 

	
(iii)

	
grant MinQuest
forty thousand (40,000) Options (independent of any Options
previously granted) to be exercised at the Fair Market
Price.

 

	
 

	
(e)

	
Between January 17,
2018 and January 16, 2019 Star Gold shall:

 

	
 

	
(i)

	
incur Expenditures
on the Properly (including any surplus Expenditures incurred prior
to January 17, 2018) of five hundred thousand and no/100 dollars
($500,000.00); and

 

2

 

 

	
 

	
(ii)

	
make cash payments
to MinQuest (independent of any required cash payments made prior
to January 17, 2018) totaling forty five thousand and no/100
dollars ($45,000.00); and

 

	
 

	
(iii)

	
grant MinQuest
forty five thousand (45,000) Options (independent of any Options
previously granted) to be exercised at the Fair Market
Price.

 

	
 

	
(f)

	
Between January 17,
2019 and January 16, 2020 Star Gold shall:

 

	
 

	
(i)

	
incur Expenditures
on the Property (including any surplus Expenditures incurred prior
to January 17, 2019) of seven hundred thousand and no/100 dollars
($700,000.00); and

 

	
 

	
(ii)

	
make cash payments
to MinQuest (independent of any required cash payments made prior
to January 17, 2019) totaling fifty thousand and no/100 dollars
($50,000.00); and

 

	
 

	
(iii)

	
grant MinQuest
fifty thousand (50,000) Options (independent of any Options
previously granted) to be exercised at the Fair Market
Price.

 

	
3.

	
MISCELLANEOUS.

 

3.1       No
Third Parties Benefited. This Amendment is between and for
the sole benefit of Star Gold and MinQuest and their successors and
assigns, and creates no rights whatsoever in favor of any other
person or entity and no other person or entity will have any rights
to rely hereon.

 

3.2       Notices.
All notices or other written communications hereunder will be
deemed to have been properly given (i) upon delivery, if delivered
in person or by facsimile transmission with receipt of an
electronic confirmation thereof, (ii) one Business Day after having
been deposited for overnight delivery with any reputable overnight
courier service, or (iii) three Business Days after having been
deposited in any post office or mail depository regularly
maintained by the U.S. Postal Service and sent by registered or
certified mail, postage prepaid, return receipt requested,
addressed as follows:

 

	
If to Star
Gold:

	
Attn: Kelly J.
Stopher

611 E. Sherman Avenue

Coeur d’ Alene, ID 83814

Phone: (208) 664-5066

Fax: (208) 765-8520

	
 

	
 

	
With a copy
to:

	
Parsons/Burnett/Bjordahl/Hume,
LLP

Attn: Robert J. Burnett

505 W. Riverside Avenue, Suite 500

Spokane, Washington 99201

Phone: (509) 252-5066

Fax: (509) 252-5067

	
 

	
 

	
If to
MinQuest:

	
Attn: Richard
Kern

MinQuest Inc

4235 Christy Way, Reno 89519

Phone: (775) 746-4471

Fax: (775) 746-0938

	
 

	
 

	
With a copy
to:

	
 ________________________

	
 

	
 ________________________

	
 

	
Phone: (__)
______________

	
 

	
Fax:
(__)_________________

 

3

 

 

3.3       Additional
Documents. Each Party shall execute such additional
documents as may reasonably be requested by the other Party to
effectuate the provisions of this Amendment.

 

3.4       Assignment.
No Party may assign its rights or obligations under this Amendment
without the prior written consent of the other Party. Any purported
assignment without the other Party’s prior written consent
will be void ab initio.

 

3.5       Authorization;
Binding Effect. Each Party represents to the other that its
execution of this Amendment has been authorized by all necessary
corporate action and that this Amendment constitutes a binding
obligation of such Party. Each individual who executes this
Amendment on behalf of a Party represents to all Parties that he or
she is authorized to do so. This Amendment will bind each
Party’s successors and permitted assigns.

 

3.6       Attorneys’
Fees. If a Party is in default under this Amendment the
other Party will have the right, at the expense of the defaulting
Party, to retain an attorney to make demand, enforce remedies, or
otherwise protect or enforce the rights of the non-defaulting
Party. A Party in default shall pay all attorneys’ fees and
costs so incurred.

 

3.7       Consents
and Approvals. Unless specifically stated to the contrary in
this Amendment (i.e., by stating that a Party’s consent or
approval may be granted or withheld in its sole discretion),
whenever any provision of this Amendment requires a Party to
provide its consent or approval, such Party will not unreasonably
condition, withhold or delay such consent or approval, provided
that the Party seeking the consent is not in default under the
Agreement.

 

3.8       Consent
Required to Amend or Waive. No amendment or modification of
any provision of this Amendment will be effective unless made in
writing and signed by each of the Parties.

 

3.9       Counterparts.
This Amendment may be executed in counterparts each of which will
be deemed an original, and such counterparts when taken together
shall constitute but one agreement.

 

3.10     Entire
Agreement. This Amendment sets forth the entire
understanding of the Parties with respect to the subject matter of
this Amendment and supersedes all prior agreements and
understandings between the Parties regarding the subject matter of
this Amendment. No other amendments to the Option Agreement are
contemplated or intended by this Amendment except such other
amendments as may be required to carry out the specific terms and
intent of this Amendment.

 

4

 

 

3.11       Governing
Law; Consent to Jurisdiction. This Amendment and its
interpretation and enforcement are governed by the laws of the
state of Nevada. Each Party agrees that venue for any dispute
arising out of or in connection with this Amendment will be in
Mineral County, Nevada and each Party waives any objections it may
now or hereafter have regarding such venue.

 

3.12       No
Waiver. No waiver by any Party of any right or default under
this Amendment will be effective unless in writing and signed by
the waiving Party. No such waiver will be deemed to extend to any
prior or subsequent right or default or affect in any way any
rights arising by virtue of any prior or subsequent such
occurrence.

 

3.13       Relationship
of the Panics. The relationship of the Parties is strictly
one of Optionor and Optionee. This Amendment is neither intended
to, nor will it be construed as, an agreement to create a joint
venture, partnership, or other form of business association between
the Parties.

 

3.14       Severability.
If for any reason any provision of this Amendment is determined by
a tribunal of competent jurisdiction to be legally invalid or
unenforceable, the validity of the remainder of the Amendment will
not be affected and such provision will be deemed modified to the
minimum extent necessary to make such provision consistent with
applicable law and. in its modified form, such provision will then
be enforceable and enforced.

 

3.15       Terminology.
Unless specifically indicated to the contrary: (i) wherever from
the context it appears appropriate, each term stated in either the
singular or the plural will include the plural and the masculine
gender will include the feminine and neuter genders; (ii) the term
“or” is not exclusive; (iii) the term
“including” (or any form thereof) will not be limiting
or exclusive; (iv) the words “Amendment,”
“herein,” “hereof,”
“hereunder,” or other words of similar import refer to
this Amendment as a whole, including exhibits and schedules (if
any), as the same may be modified, amended or supplanted. The
headings in this Amendment have no independent
meaning.

 

3.16       Disclaimer—Preparation
of Amendment. This Amendment was originally prepared by
counsel for Star Gold. The Parties agree, however, that this fact
shall not create any presumption in favor or against any Party in
respect of the interpretation or enforcement of this Amendment.
Each other Party is advised to have this Amendment reviewed by
independent legal and tax counsel prior to its execution. By
executing this Amendment each such Party represents (i) that it has
read and understands this Amendment, (ii) that it has had the
opportunity to obtain independent legal and tax advice regarding
this Amendment and (iii) that it has obtained such independent
advice or has freely elected not to do so.

 

5

 

 

IN WITNESS WHEREOF,
the Parties hereto have caused this Amendment to be executed as of
the date first written above.

 

	
STAR GOLD
CORP.

	
 

	
MINQUEST,
INC.

	
 

	
 

	
 

	
BY:

	

	
 

	
BY:

	

	
 

	
David Segelov,
President and CEO

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

	
 

	
 

	
Richard Kern,
President

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

6

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00298-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00298-of-00352.parquet"}]]