SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report: (Date of earliest event reported): September 10, 2005
DRAGON GOLD RESOURCES, INC.
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(Exact name of Registrant as specified in its charter)
000-50541
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(Commission file number)
Nevada 88-0507007
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(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation)
338 Euston Road, London NW1 3BT, UK
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(Address of principal executive offices) (Zip code)
+44 (0) 207 416 4920
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(Registrant's telephone number, including area code)
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions. (see General Instruction A.2. below).
* Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
* Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
* Pre-commencement communications pursuant to Rule 14d-2(b) uner the Exchange
Act (17 CFR 240.14d-2(b)). Item 1.01 Entry into a Material Definitive
Agreement
Item 1.01 Entry into a Material Definitive Agreement
On September 10, 2005, the Company entered into a cooperative agreement on
exploration and development of the Maling and Longhou Gold Properties in
Longshen and Lingchuan Counties, Guangzi Province, China.
Under the agreement, the Company and the Guilin Research Institute of Geology
and Mineral Resources (Institute) located in Guangxi, China agree to form a
Sino-Foreign cooperative joint venture company to explore and develop the Maling
and Longhou Gold Properties. This Agreement contains only the principal terms of
the final joint venture contract expected to be signed within three months of
signing this Agreement. According to the terms of this Agreement, the Company
will be required to contribute $800,000 to the Institute over a period of 30
months after the mineral exploration rights have been transferred into the JV
Company. During the exploration stage, which is expected to last 3 years, the
Company will have the right to earn an interest of 75% in the JV Company by
spending US$2.5 million in exploration activities. The term of the cooperation
agreement is 30 years.
Item 9.01. Financial Statements and Exhibits
(c) Exhibits
10.1 Cooperative Agreement on Exploration and Development of the Maling and
Longhou Gold Properties in Longshen and Lingchuan Counties, Guangzi
Province, China
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
DRAGON GOLD RESOURCES, INC.
September 15, 2005 /s/ Johannes Petersen
President and Chief Executive Officer
Exhibit 10.01 Cooperative Agreement on Exploration and Development of the Maling
and Longhou Gold Properties in Longshen and Lingchuan Counties,
Guangzi Province, China
COOPERATIVE AGREEMENT ON EXPLORATION AND DEVELOPMENT OF THE MALING AND LONGHOU
GOLD PROPERTIES IN LONGSHEN AND LINGCHUAN COUNTIES, GUANGXI PROVINCE, CHINA
Party A: Guilin Research Institute of Geology and Mineral Resources, Guangxi,
China
Party B: Dragon Gold Resources Inc., United Kingdom
Through friendly negotiation both parties agree on the following principal terms
regarding exploration and development of the Maling and Longhou Gold Properties,
and its associated minerals, in Longsheng and Lingchuan Counties of Guangxi
Zhuang Autonomous Region (herein referred as "the Cooperative Area", see
attached "Appendix A" which shows the mineral rights blocks owned by Party A):
1. Parties A and B will form a Sino-Foreign cooperative joint venture company
("the JV Company"), which will carry out exploration and development within the
Cooperative Area in Longsheng and Lingchuan area of Guangxi. Upon the JV Company
discovering and approving commercially viable deposit(s), the JV Company will
proceed to develop the deposits.
2. The investment of the JV Company will be carried out in two Stages. The First
Stage will be the Exploration Stage. Subject to the exploration results of the
First Stage, the Second Stage will be the Development Stage.
3. The registered capital for the JV Company in the First Stage shall be Three
Million and Three Hundred Thousand US Dollars (US$3,300,000).
4. The Parties' cooperative condition and interests are as follows:
4.1 During the Exploration Stage of the JV Company, Party A will use its
mineral exploration rights and exploration findings valued at US$800,000 as
its contribution to the joint-venture; Party B will contribute in cash to
the joint-venture. The interest ratio of the Parties in the JV Company will
be 25% for Party A; and 75% for Party B.
4.2 Party B shall contribute US$2,500,000 during the Exploration Stage. The
two Parties shall share risks and profits of the JV Company based on their
interest ratios, respectively. The Exploration Stage will be three years.
The investment in further exploration activities before entering the Second
Stage will be subject to the results of the First Stage.
4.3 Party B will pay Party A Eight Hundred Thousand US Dollars (US$800,000)
in cash within three years as a compensation to Party A's exploration
expenditures and achievements, in accordance with the payment schedule
defined below (If party B opts to enter the Development Stage earlier than
scheduled, Party B will make a payment to Party A for the balance of the
Eight Hundred Thousand US Dollars):
Cash Payment Schedule Amount of Payment (USD)
Within 30 days after signing final contract 50,000
Within 1 to 6 months after the mineral exploration right transferred 100,000
into the JV Company
Within 7 to 18 months after the mineral exploration right 200,000
transferred into the JV Company
Within 19 to 30 months after the mineral exploration right 450,000
transferred into the JV Company
Total: 800,000
4.4 After completion of the First Stage, if exploration and development
requires additional investment, then Parties shall make cash
contribution based on 25% (Party A) and 75% (Party B) interest ratio.
If one party fails to or is not willing to invest, then it may elect
to have its interest in the JV Company treated in one of the following
ways: (A) to be diluted by other party's additional capital
contribution; however, Party A's interest shall not be diluted to less
than 10% ; (B) to sell or transfer or dispose all or any portion of
its interest in the JV Company; or (C) if one party elects to sell or
transfer a portion of its interest and after that party has complete
such sale or transfer, if that party fails to or is not willing to
make contribution based on its then interest in the JV Company, then
its interest in the JV Company will be diluted by the other parties'
contributions and that party shall lose its right to maintain a
minimum interest in the JV Company.
4.5 Party B's contributions shall follow the following schedule:
US$500,000 within 12 months after signing the final contract; another
US$1,000,000 within 24 months; and further US$1,000,000 within 36
months after signing the final contract.
4.6 Before Party B has contributed its first US$500,000, Party B has the
right to elect not to make further contribution in which case Party B
shall transfer all its interest in the JV Company to Party A at no
cost. Before completing its US$2,500,000 contribution and after
contributing US$500,000, if Party B elects not to make further
contributions, Party B shall have earned an interest in the JV
company, based on its actual contributions, to be calculated in the
following way: Party B earns 0.375% interest in the JV Company for
every US$10,000 contributed in excess of the first US$500,000
contribution.
5 In order for cooperative exploration activities to commence in a timely
manner, within One Month of signing of this agreement, Party B shall wire
US$50,000 to an account under Party A's name that is jointly supervised by
the two Parties. The fund will be used to perform an initial geological
evaluation program on the Cooperative Area. This contribution shall be
accounted for as part of the Party B's contribution to the JV Company, and
these funds will be managed jointly by both parties requiring dual
signatories, one approved by each party. At the same time, the Parties will
form a Joint Venture Management Committee to manage the current program and
meanwhile will carry out the preparation work for the establishment of the
Sino-Foreign cooperative joint venture company. Once the JV Company is
established, the JV Company's Board of Directors will replace the Joint
Venture Management Committee.
6 Obligations of the Parties:
6.1 For future exploration work carried out in the Cooperative Area, Party
A will have a priority to be contracted for the geological exploration
work, however, Party A must be able to perform the work competitively
and according to the requirements set out by Joint Venture Management
Committee (or the Board of Directors).
6.2 After signing of this agreement, Party A shall provide all necessary
geological information to Party B so that Party B can organize experts
to evaluate the projects. Party B shall keep confidential all received
geological information and shall be fully responsible for the damage
caused by leaking of the information.
6.3 After signing of this agreement, Party A shall assist Party B to
establish the JV Company; after the establishment of the JV Company,
Party A shall transfer its mineral rights of Cooperative Area into the
JV Company as soon as possible.
7 Joint Venture Management Committee (Board of Directors)
7.1 The Joint Venture Management Committee will have 5 members, three
appointed by Party B and two appointed by Party A. The Chairman is
appointed by Party B and Vice Chairman by Party A. The Board of
Directors will have 5 Directors, three appointed by Party B and two
appointed by Party A. The Chairman is appointed by Party B and Vice
Chairman by Party A.
7.2 The General Manager nominated by Party B and Deputy-General Manager
nominated by Party A, will be appointed by the Joint Venture
Management Committee (or the Board of Directors) and will be
responsible for the daily operation of the JV Company.
8 Right of First Refusal
Should either Party (a "Vending Party") elect to sell, transfer, or otherwise
dispose of all or any portion of its interest in the JV Company, it must first
offer such interest (the "Offered Interest") to the other Party ("Other Party").
The Other Party must reply to the Vending Party within 30 days after receipt of
the offer. If the Other Party does not intend to increase its interest in the JV
Company, the Vending Party may transfer its Offered Interest within 90 days to a
third party but the terms and conditions shall not be more favorable than the
offer to the Other Party. Should the Vending Party be unable to transfer its
Offered Interest in the JV Company within 90 days or alters terms and conditions
of transferring, the Vending Party must again comply with the above provision
and offer it again to the Other Party.
9.The term of the cooperation is 30 years.
10. Final Contract
The Parties acknowledge that this agreement contains only the principal terms of
the final contract. Other matters and issues shall be determined in the final
contract. The final joint venture contract shall be signed within three months
of signing this agreement. During this period, the Party A shall not contact
and/or deal with any third party on any forms of cooperation regarding the
Cooperative Area. This Agreement has total four copies and is written in both
Chinese and English, and signing parties shall each keep two copies. For all
purposes, the Chinese and English copies of this agreement shall be equally
effective.
Party A: Party B
Guilin Research Institute of Geology and Dragon Gold Resources Inc.
Mineral Resources
Address: Address:
#2 Fuxing Road, Guilin City, 338 Euston Road, Suite 323,
Guangxi, China London, United Kingdom
Representative: Yongping Huang Representative: Johannes Petersen
___________________________ ___________________________
Date: September 10, 2005 Date: September 10, 2005
Contact Phone: 86-773-583-9404 Contact Phone: 0044-207-416-4920
Contact Person: Mo Jiangping Contact Person: Johannes Petersen
Fax: 86-773-581-3531 Fax: 0044-207-416-4975
Bank Account: Guilin Gaoxin Branch Of Communication Bank Account Number: 453008110018000028766
APPENDIX A
DESCRIPTION OF COOPERATIVE AREAS
Details of Cooperative Areas
1.
Name of Cooperative Area: Longhou Gold Property in Longsheng County,
Guangxi
Location of Cooperative Area: Longsheng County of Guilin City, Guangxi
Coordinates: 110(degree)05'30?--110(degree)06'30?,25(degree)46'15?--25
(degree)47'30?
Exploration License Number: 4500000320042
Renewal Date of License: 2003/02/24/-2005/12/10
Area of Property: 3.87km(2)
2.
Name of Cooperative Area: Maling Gold Property, Longsheng County, Guangxi
Location of Cooperative Area: Longsheng and Lingchuan Counties of Guilin
City, Guangxi
Coordinates: 110(degree)09'00?--110(degree)11'15?,25(degree)41'00?--25
(degree)43'00?
Exploration License Number: 4500000310092
Renewal Date of License: 2003/04/09-2006/04/09
Area of Property: 11.61km(2)
APPENDIX B
COPY OF EXPLORATION LICENSE CERTIFICATES