Attached files
Exhibit 10.2
PURCHASE AGREEMENT
BY THIS PURCHASE AGREEMENT
Effective as of the 24th day of December, 2009 (the "Effective Date"),
by and between GEOXPLOR CORP., a Nevada corporation, whose address is 3655
West Anthem Way, Anthem, Arizona 85086 ("GeoXplor"),
and
QUUIBUS TECHNOLOGY, INC., a Nevada corporation whose address is 114 West
Magnolia St., #400 - 136, Bellingham, Washington 98225 ("Quuibus").
GeoXplor, in consideration of the agreements set forth herein, has granted
certain rights to Quuibus under the following terms and conditions:
1. GRANT; DEFINITIONS
a. EXPLORATION LICENSE - GeoXplor hereby grants to Quuibus an exclusive
license to enter upon the "Property" together with the right to conduct "Mineral
Exploration" during the five-year evaluation and due diligence term.
b. DEFINITIONS - The words and phrases used in this Agreement shall have
the following meanings:
(1) The "Property" shall include those Vanadium & Uranium claims in
San Juan County Utah, more particularly described in Exhibit A attached
hereto.
(2) "Mineral Exploration and Development Testing" shall include those
activities that Quuibus, in its sole judgment and discretion, may deem
advisable for the purpose of ascertaining any facts relating to the
occurrence, nature and extent of Vanadium & Uranium and related Vanadium &
Uranium compounds or mineralization in and under the Property and the
metallurgical and physical properties of such minerals; including, but not
limited to, surface trenching, excavations, geophysical and geochemical
surveys, drilling, the sinking of shafts for bulk sampling, and further
including the right to use the surface for access, to place and use
facilities on the surface and to use water and other surface resources that
may be useful or convenient in connection with such activities. Mineral
Exploration and Development Testing shall specifically include such testing
as may be required for filings with any applicable stock exchange.
(3) "Shares" means fully paid and non-assessable common shares in the
capital of Quuibus, issued pursuant to exemptions from registration and
Page | 2
prospectus requirements contained in the United States Securities Act of
1933 and the rules and regulations promulgated thereunder, which Shares
shall contain such restrictive legends regarding applicable hold periods as
required by such securities laws.
(4) "Dollar(s)" or "$" shall mean currency of the United States.
c. TRANSFER OF TITLE - Upon Quuibus's completion of its obligations under
subsection a and b of Section 2 and subsection f of Section 4, GeoXplor shall
transfer title of the Property to Quuibus subject to (1) Quuibus's concurrent
transfer to GeoXplor of a royalty on the production of Vanadium & Uranium and
other commercially viable minerals from the Property and (2) a further agreement
to pay an additional bonus as specified in subsection c of Section 2 of this
Agreement.
2. CONSIDERATION TO GEOXPLOR
a. PAYMENTS - Quuibus shall pay GeoXplor in consideration of the grant of
the exploration license and other rights granted under this Agreement the
following:
(1) Five Thousand Dollars ($5,000.00) upon the execution of a letter
of intent on November 4, 2009, the receipt of which is acknowledged;
(2) Seventy Five Thousand Dollars ($75,000.00) to GeoXplor on or
before December 15, 2009, the closing date;
(3) First year anniversary of the closing date U.S. $100,000.00
(4) Second year anniversary of the closing date U.S. $100,000.00
(5) Third year anniversary of the closing date U.S. $100,000.00
(6) Fourth year anniversary of the closing date U.S. $100,000.00
(7) Fifth year anniversary of the closing date nil
(8) Sixth year anniversary of the closing date nil
b. STOCK TRANSFER - As additional consideration, the Purchase Price shall
include the issuance of 1,000,000 Shares, subject to such conditions as may be
imposed by the rules and regulations of the United States Securities and
Exchange Commission, as follows:
(1) Two Hundred and Fifty Thousand (250,000) Shares on execution of
this Agreement;
Page | 3
(2) Two Hundred Fifty Thousand (250,000) Shares on or before the date
one year from the Effective Date of this Agreement; and
(3) Two Hundred Fifty Thousand (250,000) Shares on or before the date
two years from the Effective Date of this Agreement.
(4) Two Hundred Fifty Thousand (250,000) Shares on or before the date
three years from the Effective Date of this Agreement.
c. CONDITIONS FOR TRANSFER OF TITLE AND SUBSEQUENT LIMITATIONS -
(1) At such time as the Quuibus has completed the payments and stock
transfers specified in subsections a and b of this Section 3, and has
completed the expenditures for Work specified in subsection f of Section 4,
the Property shall be transferred to Quuibus by Quitclaim Deed.
(2) Concurrently with the transfer of title to Quuibus, Quuibus shall
convey to GeoXplor a "Net Value Royalty" on production of Vanadium &
Uranium and other minerals from the Property measured by three percent (3%)
of the gross proceeds received by the Quuibus from the sale or other
disposition of Vanadium & Uranium or other Vanadium & Uranium compounds
less (i) transportation of the product from the place of treatment to the
purchaser, (ii) all handling and insurance charges associated with the
transportation, and (iii) any taxes associated with the sale or disposition
of the product (excluding any income taxes of Quuibus). Quuibus shall have
the further right to purchase up to two percent (2%) of the Net Value
Royalty, in whole percentage points, for One Million Dollars ($1,000,000)
for each one percent (1%).
(3) If Quuibus, its assignee or a joint venture including Quuibus, (i)
delivers to its Board of Directors or applicable other management a
feasibility study recommending mining of Vanadium & Uranium carbonate or
other Vanadium & Uranium compound from the Property and such Board of
management authorizes implementation of a mining plan, or (ii) sells,
options, assigns, disposes or otherwise alienates all or a portion of its
interest in the Property, Quuibus shall pay GeoXplor an additional bonus of
Five Hundred Thousand Dollars ($500,000) in cash or shares of Quuibus. The
election to obtain cash or shares of Quuibus shall be at the sole election
of GeoXplor.
d. METHOD OF MAKING PAYMENTS - All payments required under this Agreement
may be mailed or delivered to GeoXplor's address or to any single depository as
GeoXplor may instruct. Upon making payment to the authorized agent or
depository, Quuibus shall be relieved of any responsibility for the distribution
of such payment to GeoXplor. The delivery or the deposit in the mail of any
payment hereunder on or before the due date thereof shall be deemed timely
payment hereunder.
Page | 4
3. INSPECTION
Both GeoXplor or Quuibus (or their respective agents), may enter upon the
Property or processing facilities to inspect the same at such times and upon
such notice to the other party as shall not unreasonably or unnecessarily hinder
or interrupt the operations of Quuibus. At such time as a royalty is conveyed to
GeoXplor, the royalty document shall include a right of inspection of the
Property and the books and records used for the calculation of royalty and the
right to audit on an annual basis.
4. OBLIGATIONS OF QUUIBUS
a. CONDUCT OF OPERATIONS - All work performed on the Property by Quuibus
pursuant its rights under this Agreement or by GeoXplor pursuant to its
activities as the operator to implement Work authorized by Quuibus, shall be
done in a good and workmanlike manner and in compliance with all state or
federal laws and regulations governing such operations.
b. PROTECTION FROM LIENS - Quuibus shall pay all expenses incurred or
authorized by it in its activities on the Property and shall allow no liens
arising from any act of Quuibus to remain upon the Property; provided, however,
that Quuibus shall not be required to remove any such lien as long as Quuibus is
contesting in good faith the validity or amount thereof.
c. INDEMNITY - Quuibus shall indemnify GeoXplor against and hold GeoXplor
harmless from any suit, claim, judgment or demand whatsoever arising out of
negligence on the part of Quuibus in the exercise of any of its rights pursuant
to this Agreement, provided that if GeoXplor or any person or instrumentality
acting on GeoXplor's behalf shall have been a contributing cause to the event
giving rise to such suit, claim, demand or judgment, Quuibus 's obligation to
indemnify GeoXplor shall not exceed Quuibus 's liability under the laws
applicable to the event giving rise to such suit, claim, demand or judgment.
Likewise, GeoXplor shall similarly indemnify Quuibus from claims arising out of
its negligence in the conduct of its activities as operator to implement Work
authorized by Quuibus.
d. PAYMENT OF TAXES - Quuibus shall pay all taxes levied against the
Property and any improvements on the Property. Quuibus shall have the right to
contest, in the courts or otherwise, the validity or amount of any taxes or
assessments, before it shall be required to pay the same. If this Agreement is
terminated or otherwise expires, any taxes that are Quuibus 's responsibility
shall be prorated for the calendar year of expiration or termination as of the
date Quuibus has removed its equipment, facilities and improvements from the
Property.
e. MAINTENANCE - Quuibus shall timely pay and make the appropriate record
of the payment of the claim maintenance fee or any other fee required under
state or federal law to maintain the unpatented mining claims included within
Page | 5
the Property for each assessment year during which this Agreement continues in
force beyond September 1 of the applicable assessment year.
f. WORK COMMITMENT - Before the expiration of four (4) years from the
Effective Date, Quuibus shall expend not less than One Million Dollars
($1,000,000) in Mineral Exploration and Development Testing ("Work"). The Work
shall be scheduled to expend not less than One Hundred Fifty Thousand Dollars
($150,000) during the first year, Two Hundred Thousand Dollars ($200,000) during
the second year, Three Hundred Fifty Thousand Dollars ($350,000) during the
third year, Five Hundred Thousand Dollars ($500,000) during the fourth year,
nothing during the fifth year, and Production during the sixth year. The nature,
place and conduct of such Work shall be at the sole discretion of Quuibus and
the amount of the expenditures shall be determined by the direct cost to Quuibus
of Work performed. GeoXplor shall undertake to perform such Work as directed by
Quuibus under Work plans provided to GeoXplor on a periodic or as needed basis.
Quuibus's performance of Work shall otherwise conform to the Work plan and shall
conform to industry standards. Any expenditure in excess of the amount required
for any annual period shall be applicable against expenditures required for the
succeeding year or years.
5. TITLE MATTERS
a. REPRESENTATIONS AND WARRANTIES RELATED TO THE PROPERTY - GeoXplor
represents and warrants to Quuibus that: (1) the unpatented mining claims
constituting the Property have been located and appropriate record made thereof
in compliance with the laws of the United States and the laws of the State of
Nevada, (2) the claim maintenance fees have been paid for the year beginning on
September 1 prior to the effective date of this Agreement and appropriate record
made thereof; (3) there is no claim of adverse mineral rights affecting the
Property, (4) subject to the paramount interest of the United States, GeoXplor
controls the full undivided possessory title to the Property, and (5) except as
specified in Exhibit A, GeoXplor's possessory right to the Property is free and
clear of all liens and encumbrances.
b. JOINT REPRESENTATIONS - Quuibus and GeoXplor jointly represent and
warrant that each company: (1) have the full right, power and capacity to enter
into this Agreement upon the terms set forth herein, (2) is incorporated,
organized and in good standing under the laws of the state of its incorporation
and is qualified to do business and is in good standing in the State of Nevada;
(3) has obtained all necessary corporate and shareholder approvals and no
further action on the part of its directors or shareholders is necessary or
desirable to make this Agreement valid and binding; and (4) neither the
execution and delivery of this Agreement nor any of the agreement referred to
herein or contemplated hereby, nor the consummation of the transactions hereby
contemplated conflict with any agreement to which it is a party and by which it
is currently bound.
c. TITLE DOCUMENTS; DATA - Upon written request of Quuibus at any time
during the term hereof, GeoXplor shall promptly deliver to Quuibus copies of all
title documents affecting the Property that GeoXplor has in its possession. If
GeoXplor is in possession or knows the whereabouts of technical data concerning
Page | 6
the mineral estate of the Property, GeoXplor shall, at Quuibus's expense,
furnish copies of such materials to Quuibus or notify Quuibus of the location of
such information.
d. TITLE DEFECTS, DEFENSE AND PROTECTION - Quuibus has, during its initial
due diligence examination of the Property prior to the Effective Date, examined
and approved GeoXplor's title to the Property. If title to any of the Property
is contested or questioned by any person, entity or governmental agency GeoXplor
and Quuibus shall undertake such actions as may be required to perfect, defend
or initiate litigation to protect such title. In that event, all costs of such
action shall be paid by Quuibus and shall be a credit toward the Work
obligations of subsection f of Section 4.
e. AMENDMENT AND RELOCATION OF MINING CLAIMS - Quuibus shall have the
right, upon prior consultation with GeoXplor, to amend or relocate the
unpatented claims which are subject to this Agreement. The location notices of
any such amended or related claims shall be approved by GeoXplor.
f. CHANGE OF LAW - If the law of the United States concerning acquisition
of mineral rights on federally managed lands is repealed, amended, or new
legislation is enacted, Quuibus shall have the right, at its expense, to take
whatever action it deems appropriate to preserve a right to explore for,
develop, and mine minerals from the Property. If Quuibus elects to take any
action under the terms of this subsection, it shall first notify GeoXplor in
writing setting forth the nature of the proposed action and an explanation
thereof. GeoXplor agrees to cooperate with Quuibus and execute whatever
documents are deemed necessary by Quuibus to accomplish such action. Nothing in
this subsection shall impose any obligation upon Quuibus to take any action, or
diminish the right of GeoXplor to take action it deems appropriate; provided,
however, that if GeoXplor chooses to take any action, it will first inform
Quuibus of the nature of such contemplated action.
g. GENERAL - Nothing herein contained and no notice or action which may be
taken under this Section 5 shall limit or detract from Quuibus 's right to
terminate this Agreement in the manner hereinafter provided.
6. TERMINATION; REMOVAL OF PROPERTY; DATA
a. TERMINATION BY GEOXPLOR - If Quuibus defaults in the performance of its
obligations specified in this Agreement, GeoXplor shall give Quuibus written
notice specifying the default. If the default is not cured within thirty (30)
days after Quuibus has received the notice, or if Quuibus has not within that
time begun action to cure the default and does not thereafter diligently
prosecute such action to completion, GeoXplor may terminate this Agreement by
delivering to Quuibus written notice of such termination. GeoXplor's right to
terminate this Agreement shall be its sole remedy for any failure to make
payments required under Section 2. If Quuibus in good faith disputes the
existence of a default, Quuibus shall initiate appropriate action in a court of
competent jurisdiction within the 30-day period and the time to cure shall run
Page | 7
from the date of a final determination that a default exists. GeoXplor shall
have no right to terminate this Agreement except as set forth in this subsection
a of Section 6.
b. TERMINATION BY Quuibus - Quuibus shall have the right to terminate this
Agreement at any time by written notice from Quuibus to GeoXplor.
c. TERMINATION OF GEOXPLOR AS OPERATOR - If GeoXplor defaults in the
performance of its duties and obligations to perform plans for the performance
of Work as specified in subsection f of Section 4 of this Agreement, Quuibus
shall give GeoXplor written notice specifying the default and the same
provisions specified in subsection a of this Section 6 shall apply. If the
default is not cured, or other appropriate action taken, GeoXplor's designation
as operator shall terminate. The termination of GeoXplor as operator shall not
release the Quuibus from its obligation to complete the expenditures of Work
required under subsection f of Section 4.
d. EFFECT OF TERMINATION - From and after the date of termination of this
Agreement by either party, all right, title and interest of the parties under
this Agreement shall terminate, and neither party shall be required to make
further payments or perform any further obligations hereunder concerning the
Property, except payments and obligations, the commitment to pay or the due
dates for the payment or performance of which occur prior to the termination
date.
e. REMOVAL OF PROPERTY - Upon any termination or expiration of this
Agreement, Quuibus shall have a period of three (3) months from and after the
effective date of termination within which it may elect to remove from the
Property all of its machinery, buildings, structures, facilities, equipment and
other property of every nature and description erected, placed or situated
thereon, except supports placed in shafts, drifts or openings in the Property.
Failure of Quuibus to so remove the same shall constitute an abandonment by
Quuibus to GeoXplor of the same; provided, however, that Quuibus may still be
required to remove such property upon notice from GeoXplor at any time during
the three-month period and thirty (30) days thereafter.
f. DELIVERY OF DATA - If this Agreement is terminated, upon written request
given by GeoXplor within thirty (30) days of said termination, Quuibus shall,
within a reasonable time, furnish GeoXplor copies of all available
noninterpretive exploration, development and mining data pertaining to the
Property prepared by or for Quuibus.
g. RELINQUISHMENT OF RECORD - If this Agreement is terminated or otherwise
expires, Quuibus shall provide GeoXplor with a recordable document sufficient to
provide notice that Quuibus no longer asserts rights to the Property under this
Agreement.
7. SHARE MATTERS
GeoXplor represents and warrants to Quuibus that it is an "accredited"
investor as that term is defined in Rule 501 of Regulation D promulgated under
the United States Securities Act of 1933, as amended, and acknowledges and
agrees that the Shares will be issued in accordance with all applicable
Page | 8
securities laws and will be subject to hold periods and restrictions on resale
in accordance with applicable securities laws and it is GeoXplor's
responsibility to determine what those hold periods and restrictions are before
selling or otherwise transferring any Shares.
8. NOTICES
Any notice or communication required or permitted hereunder shall be
effective when personally delivered or deposited, postage prepaid, certified or
registered, in the United States mail to the addresses specified above. Either
party may, by notice to the other given as aforesaid, change its mailing address
for future notices.
9. CONFIDENTIALITY
Each of the parties agrees that all information obtained under the terms of
this Agreement will not be publicly disclosed or used other than for the
activities contemplated hereunder except as required by law or by the rules and
regulations of any regulatory authority or stock exchange having jurisdiction or
with prior written consent of the other party, such consent not to be
unreasonably withheld.
10. BINDING EFFECT; ASSIGNMENT
This Agreement shall not be assigned by Quuibus except to a wholly owned
subsidiary, in which case the Quuibus shall guarantee the performance of the
assignee. GeoXplor may assign all or any portion of its right to the royalty
provided hereunder.
11. FORCE MAJEURE
If Quuibus is delayed or interrupted in or prevented from exercising its
rights or performing its obligations, as herein provided, by reasons of "force
majeure," then, and in all such cases, Quuibus shall be excused, without
liability, from performance of its obligations set forth in this Agreement
(except as to obligations to pay money as set forth in Sections 2 and 4), but
the provisions shall again come into full force and effect upon the termination
of the period of delay, prevention, disability or condition. "Force majeure"
includes all disabilities arising from causes beyond the reasonable control of
Quuibus; including, without limitation, acts of God, accidents, fires, damages
to facilities, labor troubles, unavailability of fuels, supplies and equipment,
orders or requirements of courts or government agencies, or the inability to
obtain environmental clearance or operating permits that may be required by
governmental authorities. If a condition of force majeure is declared, the due
dates for any performance (excluding time for payment of monies) hereunder shall
be extended for the period of the disability.
12. MEMORANDUM
The parties to this Agreement agree to execute and record a Memorandum of
this Agreement in a form sufficient to constitute record notice to third parties
Page | 9
of the rights granted hereunder, which may be recorded in the official records
of Esmeralda County, Nevada.
13. CONSTRUCTION
a. GOVERNING LAW - This Agreement shall be construed by the internal laws
but not the laws of conflict of the State of Nevada.
b. HEADINGS - The headings used in this Agreement are for convenience only
and shall not be deemed to be a part of this Agreement for purposes of
construction.
c. ENTIRE AGREEMENT - All of the agreements and understandings of the
parties with reference to the Property are embodied in this Agreement, and this
Agreement supersedes all prior agreements or understandings between the parties.
d. NO IMPLIED COVENANTS - It is expressly agreed that no implied covenant
or condition whatsoever shall be read into this Agreement relating to any time
frame as the measure of diligence for any operations of Quuibus hereunder.
[SIGNATURE PAGE TO FOLLOW]
Page | 10
14. FURTHER ASSURANCES
The parties agree to perform all acts and execute all documents that may be
necessary to carry out the spirit and intent of this Agreement.
SIGNED, effective as of the date recited above.
GEOXPLOR CORP. QUUIBUS TECHNOLOGY, INC.
By: /s/ signed By /s/ signed
---------------------------------- ----------------------------------
State of Arizona )
) ss
County of Maricopa )
The foregoing document was acknowledged before me, the undersigned notary
public, this ____ day of __________, 2009, by ____________________, the
_________________ of GEOXPLOR CORPORATION, a Nevada corporation, for and on
behalf of the corporation.
-----------------------------------
Notary Public
State of___________ )
) ss
County of _________ )
The foregoing document was acknowledged before me, the undersigned notary
public, this ____ day of __________, 2009, by ____________________, the
_________________ of QUUIBUS TECHNOLOGY, INC., a Nevada corporation, for and on
behalf of the corporation.
-----------------------------------
Notary Public
Page | 11
EXHIBIT B
(ROYALTY PROVISIONS)
If the Property is conveyed to Quuibus Technologies Inc. ("Quuibus"), under
the terms of the foregoing Purchase Agreement, Quuibus shall convey to GeoXplor
Corp. ("GeoXplor"), a "Royalty" on the Net Value of Vanadium & Uranium or other
Vanadium & Uranium compounds or products ("Minerals"), as defined in the
foregoing Purchase Agreement, which Royalty conveyance shall include the
following terms and conditions:
1. PAYMENT OF ROYALTY
a. FREQUENCY OF PAYMENT OF ROYALTY. Royalty shall be due and payable within
thirty (30) business days after the sale proceeds are received from any
purchaser of Mineral produced from the Property.
b. METHOD OF MAKING PAYMENTS. All payments required hereunder may be mailed
or delivered to any single depository as GeoXplor may instruct. If the party
paying the Royalty (the "Payor") makes a payment or payments on account of the
Royalty in accordance with the provision of this exhibit B, it will have no
further responsibility for distribution of the Royalty. All charges of the
agent, trustee or depository will be borne solely by the party (ies) receiving
payments of Royalty. The delivery or the deposit in the mail of any payment
hereunder on or before the due date thereof shall be deemed timely payment
hereunder.
2. RECORDS AND REPORTS
a. RECORDS, INSPECTION AND AUDIT. Within one hundred and forth (140) days
following the end of each calendar year, commencing with the year in which the
Property (or any portion thereof) is brought into commercial production (not
inclusive of any bulk sampling programs or pilot plant or test operations), the
Payor shall deliver to GeoXplor a statement of the Royalty paid for said
calendar year. GeoXplor (or its designated agent) shall have the right within a
period of ninety (90) days from receipt of such statement to inspect the Payor's
books and records relating thereto and to conduct an independent audit of such
books and records at its own cost and expense.
b. OBJECTIONS. If GeoXplor does not request an inspection of the Payor's
books and records during the ninety (90) day period referred to in the preceding
paragraph, all payments of Royalty for the annual period will be considered
final and in full satisfaction of all obligations of the payor with respect
thereto. If GeoXplor elects to question any calculation of Royalty, GeoXplor
shall deliver to the Payor a written notice (the "Objection Notice") within
ninety (90) days after receipt by GeoXplor of the final statement. If such audit
determines that there has been a deficiency or an excess in the payment made to
GeoXplor, such deficiency or excess will be resolved by adjusting the next
payment or due hereunder. GeoXplor will pay all the costs and expenses of such
audit unless a deficiency of five percent (5%) or more of the amount due is
determined to exist. The Payor will pay the costs and expenses of such audit if
Page | 12
a deficiency of five percent (5%) or more of the amount due is determined to
exist. All books and records used and kept by the Payor to calculate the Royalty
due hereunder will be kept in accordance with generally accepted accounting
principles.
c. EVIDENCE OF MAINTENANCE OF THE CLAIMS. The Payor shall deliver to
GeoXplor, not later than the date two weeks prior to the date for the payment of
annual claim maintenance fees for the Property, evidence that the fee has been
timely paid.
3. INUREMENT
The Royalty shall run with the land and be binding on all subsequent owners
of the Property, including any amendments, relocations, patents of the same or
additional or alternative rights to mine as may be acquired for the same land
included within the Property as a result of any changes in the mineral laws of
the United States.
4. ASSIGNMENTS BY GEOXPLOR
GeoXplor may transfer, pledge, mortgage, charge or otherwise encumber all
or any part of its rights, title and interest in and to its Royalty; provided,
however, that the Payor shall be under no obligation to make its payments
hereunder to such assignee, transferee, pledge or other third party until the
Payor's receipt of notice concerning the assignment or transfer
