AGREEMENT SHIPMAN DIAMOND PROJECT

 

 

THIS AGREEMENT dated for reference the 1st day of September, 2011, is made

 

DUNCAN J. BAIN, of 49 Midale Crescent, London, Ontario N5X 3C2

(hereinafter referred to as the “Vendor”)

OF THE FIRST PART

ORO CAPITAL CORPORATION, a company incorporated

under the laws of the State of Nevada and having an office

at  23 Dassan Island Drive, Plettenberg Bay, 6600 South Africa

 

(hereinafter referred to as the “Purchaser”)

OF THE SECOND PART

 

 

 

1.       Interpretation

 

 

 

 

 

3.       Representations and Warranties of the Vendor

 

 

 

 

 

4.01           The Purchaser represents and warrants to the Vendor that:

 

(a)	the Purchaser is a corporation duly incorporated in the jurisdiction of incorporation identified on the first page of this Agreement and is a valid and subsisting corporation and is in good standing under the statute under which it was incorporated and any other applicable legislation;

 

(b)

it has full corporate power and authority to enter into this Agreement and the entering into of this Agreement does not conflict with any applicable laws or with its charter documents nor does it conflict with, or result in a breach of, or accelerate the performance required by any contract or other commitment to which it is party or by which it is bound.

 

 

5.01   If there is any disagreement, dispute or controversy (hereinafter collectively called a “Dispute”) between the parties with respect to any matter arising under this Agreement or the construction hereof, then the Dispute shall be determined by arbitration in accordance with the following procedures:

 

(a)	the party on one side of the Dispute shall inform the other party by notice of the names of three impartial and independent persons who are recognized experts in the area which is the subject matter of the Dispute; and

 

(b)	the other party shall, within seven (7) days of receipt of the notice, inform the party on the other side of the Dispute the name of the one person that it wishes to act as the sole arbitrator.

 

5.02           The arbitration shall be conducted in accordance with the Commercial Arbitration Act (Saskatchewan) and the decision of the arbitrator shall be made within thirty (30) days following his being named, shall be based exclusively on the advancement of exploration, development and production work on the Claims and not on the financial circumstances of the parties.  The costs of arbitration shall be borne equally by the parties to the Dispute unless otherwise determined by the arbitrator in the award.

 

6.01	Any notice, election, consent or other writing required or permitted to be given hereunder shall be deemed to be sufficiently given if delivered or if mailed by registered mail, addressed as follows:

 

	In the case of the Vendor:		In the case of the Purchaser:
	DUNCAN J. BAIN		ORO CAPITAL CORPORATION
	49 Midale Crescent London, Ontario Canada  N5X 3C2		23 Dassan Island Drive, Plettenberg Bay, 6600 South Africa

 

And any such notice given as aforesaid shall be deemed to have been given to the parties hereto if delivered, when delivered, or if mailed, on the tenth Business Day following the date of mailing, or, if telegraphed or faxed, on the next succeeding day following the telegraphing or faxing thereof PROVIDED HOWEVER that during the period of any postal interruption in either country of mailing or the country or delivery, any notice given hereunder by mail shall be deemed to have been given only as of the date of actual delivery of the same.  Any party may from time to time by notice in writing change its address for the purpose of this article.

 

 

 

SIGNED, SEALED AND DELIVERED by	)
DUNCAN J. BAIN in the presence of:	)
	)
	)
___________________________________	)
Signature of Witness	)
	)
___________________________________	)		DUNCAN J. BAIN
Address of Witness	)
	)
___________________________________	)
Occupation of Witness	)
THE CORPORATE SEAL of	)
ORO CAPITAL COPRATION	)
was hereunto affixed in the presence of:	)
	)		C/S
	)
Per:________________________________	)
Authorized Signatory	)

 

 

To that Agreement between DUNCAN J. BAIN., as the Vendor, ORO CAPITAL CORPORATION, as the Purchaser, dated the 1st day of September, 2011.

 

Block	Claim Number	Registered Owner	Area (Hectares)	Recording Date	Anniversary Date	Township/Range
Shipman	S-143740	Duncan Bain	256 hectares	August 8, 2011	August 7, 2013	All of Section 24, Township 52, Range 21  W of Second Meridian

 

 

 

 

 

 

To that Agreement between DUNCAN J. BAIN., as the Vendor, ORO CAPITAL CORPORATION, as the Purchaser, dated the 1st of September, 2011.

 

 

(All capitalized terms used herein shall have the definitions contained in the Agreement, unless otherwise specified.)

Pursuant to paragraph 3.1 of the Agreement to which this Schedule is attached, The Vendor is entitled to a royalty (the “GORR”) equal to 1.0% of the Average Appraised Value (as hereinafter defined) of all gem and industrial diamonds recovered, sorted and graded from the Property (the “Diamonds”), free and clear of all costs of development and operations.

“Average Appraised Value” means the average of the valuations in United States of America dollars of the Diamonds determined by two independent graders, one appointed by the Purchaser and one appointed by the Vendor.  Such independent graders shall be duly qualified and accredited, and shall sort, grade and value the Diamonds in accordance with industry standards, having regard to, but without limiting the generality of the foregoing, the commercial demand for the Diamonds, the grades of the Diamonds (gem or industrial) and the colours, size and clarity of the Diamonds.  Each independent valuator shall value each particular classification of the Diamonds in accordance with the industry price books, standards and formulas.  The parties acknowledge that the intention is that the GORR is to be paid to the Vendor on this basis, regardless of the price or proceeds actually received by the Purchaser for or in connection with the Diamonds or the manner in which a sale of the Diamonds to a third party is made, and without deduction.

The Purchaser will calculate and pay the GORR to the Vendor within thirty (30) days of the end of each calendar quarter of all Diamonds from the Property which are graded in such calendar quarter.

The Vendor shall not be entitled to participate in the profits or be obligated to share in any losses generated by the Purchaser actual marketing or sales practices.

 

 

To that Agreement between DUNCAN J. BAIN., as the Vendor, ORO CAPITAL CORPORATION, as the Purchaser, dated the 1st day of September, 2011.

 

 

For the purposes of this Agreement the term “net smelter return royalty” or “NSR” means all monies realized and actually received by the Purchaser from the sale of ores, concentrates, and/or minerals mined or extracted from the Claims other than Diamonds (the “Product”), including premiums, bonuses and subsidies less, if the Product requires smelting or other processing, all monies paid or payable by the Purchaser on account of:

(a)	all smelting, refining, treatment, selling and other costs, charges and penalties charged by the smelter or other purchase of the Product;

(b)	all costs of loading, transporting and insuring such Product from the Claims to the smelter or other purchaser; and

(c)	freight allowance, royalties paid or payable, and all taxes paid by the Purchaser on such Product except income taxes, including but not limited to production, severance, net proceeds, sales and privilege taxes.

In the event that smelting or refining are carried out in facilities owned or controlled, in whole or in part, by the Purchaser, charges, costs and penalties for such operations shall equal the amount the Purchaser would have incurred if such operations were carried out at facilities not owned or controlled by the Purchaser which offer comparable services for comparable products on prevailing terms.

The NSR shall be calculated at the end of each calendar quarter and paid by the Purchaser to the Vendor within 45 days of the end of each calendar quarter.