EXHIBIT 99
ICONET, INC.
8 Gaucho Drive, Rolling Drive Estates
California, USA
90274
June 12, 2002
SEA EMERALD DEVELOPMENT CORP.
1997 Remo Drive
Brightgrove,Ontario
N0N 1C0
Dear Sirs:
RE: OPTION TO PURCHASE INTEREST IN LANGMUIR TOWNSHIP MINERAL PROPERTY
This Agreement sets forth the general terms and conditions of our agreement
concerning the granting of an option by SEA EMERALD (the "Vendor") to ICONET
Inc. ("Iconet") to purchase a 100% interest in and to those mineral claims more
particularly described in Schedule "A" hereto (including, without limitation,
all prospecting, research, exploration, exploitation, operating and mining
permits, licenses and leases associated therewith), covering property in
Langmuir Township, Porcupine Mining Division, Ontario (the "Property").
In consideration of the sum of $10.00 paid by ICONET to the Vendor, the receipt
and sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1.0 REPRESENTATIONS AND WARRANTIES
1.1 ICONET represents and warrants to the Vendor that:
(a) it is a valid and subsisting corporation duly incorporated and in good
standing under the laws of USA ;
(b) entering into this Agreement does not and will not conflict with, and
does not and will not result in a breach of, any of the terms of its
incorporating documents or any agreement or instrument to which Iconet
is a party;
(c) this Agreement has been authorized by all necessary corporate action on
the part of ICONET ; and
(d) its Common shares are currently posted and trading on the Bulleting
Board Exchange (the "Exchange").
1.2 The Vendor represents to ICONET that:
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(a) it is the beneficial and recorded owner of the Property and owns 100%
right, title and beneficial interest in the Property;
(b) it has paid all necessary access, administration, assessment and
other fees as are required to register, hold title to, and pass good
title to the Property;
(d) to the best of its knowledge, other than for aboriginal land claims,
there are no adverse claims or challenges against or to the ownership
of or title to the Property, nor to the best of its knowledge is there
any basis therefor;
(e) save and except as set out in Schedule "B", there do not exist any
outstanding agreements or options to acquire or purchase any interest
in the Property, or to explore, develop or exploit any mineral claims
comprising the Property, and no person has any royalty or other
interest whatsoever in the Property or any production therefrom;
(f) entering into this Agreement does not and will not conflict with, and
does not and will not result in a breach of, any agreement or
instrument to which the Vendor is a party;
(g) it has due and sufficient right and authority to enter into this
Agreement and to transfer the Property in accordance with this
Agreement; and
(h) there is no remaining assessment work relating to the Property for the
2002 calendar year, and the total assessment work required for the 2002
calendar year is estimated by the Vendor to aggregate $ 12,000.00 CDN
All of which remains to be expended and recorded.
2. GRANT OF OPTION
2.1 The Vendor hereby grants to Iconet an exclusive option (the "Option")
to earn an undivided 100% interest in the Property. In order to
exercise the Option, ICONET agrees to:
(a) Issue to the Vendor 10,000,000 restricted shares of Common Stock (the
"Shares") as follows: 2,000,000 Shares within 5 business days of
acceptance of this Agreement ("Acceptance"), and 2,000,000 Shares at
six month intervals, commencing six months from the date hereof. Iconet
shall not earn any interest in and to the Property until the full
10,000,000 million Shares are issued, at which time Vendor shall
prepare and deliver to Iconet clear title in good standing for 100% of
the Property. There is no penalty for early issuance of Shares.
(b) Iconet shall pay Vendor a royalty equal to 5% of Net Smelter Returns
from production from the Property. The term "Net Smelter Returns" shall
be specifically defined by the parties in an addendum to this
agreement. The NSR shall be payable quarterly, with payment due 30 days
after the end of the prior calendar quarter, together with a detailed
accounting of the production and evidencing the calculation of the 5%
NSR. Iconet shall, at any time, have the right to buy-back from the
Vendor and/ or assignees/ successors, up to a maximum of a 2% NSR from
the 5% NSR, leaving Vendor with 3% NSR. The buy-back price shall be at
the rate of Cdn$1,000,000 per 1% NSR.
In the event there is no production from the Property, and Iconet has
not exercised its right to buy-back a 2% NSR (or any portion thereof),
on or before the fourth anniversary of this agreement (June 12, 2006),
then Iconet shall pay minimum annual advance royalty of US$50,000.00,
commencing with its first payment due on June 13, 2006, and on like
date each year thereafter, during the term of this agreement, in which
there is no production from the Property. If Iconet has exercised its
buy-back option, or any portion thereof, the obligation to make advance
royalty payments shall terminate.
In the vent Iconet, Inc. defaults on the minimum advance royalty
payment, then any and all rights, titles and interests in and to the
claims shall revert back to the Vendor upon sixty days' prior written
notice to Iconet, Inc., giving Iconet and opportunity to cure such
default within such 60 days.
The Share issuance and exploration expenditures referred to above are
collectively referred to as the "Option Price". ICONET shall not be required to
satisfy all or any of the Option Prices.
2.2 The parties hereto may extend in writing any of the deadlines set out
in paragraph 2.1.
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2.3 The Vendor acknowledges that the Shares will be subject to restrictions
on resale, including a hold period under the SECURITIES ACT of 1933, as
amended (USA), the Rules enacted pursuant thereto, and the policies of
the Exchange. The Vendor covenants and agrees with Iconet that he will
comply with all applicable rules relating to the resale of the Shares.
2.4 If and when Iconet exercises the Option, the parties agree to negotiate
in good faith and enter into an industry standard joint venture
agreement to govern the further development of the Property.
3. EXPLORATION PROGRAMS
3.1 ICONET or its duly authorized representatives shall have full conduct
of all exploration programs on the Property prior to the time that the
Option is exercised.
3.2 All work performed by Iconet or its representatives shall be performed
in a miner-like manner and shall comply with all laws, regulations and
permitting requirements of Canada and the Province of Ontario,
including compliance with all:
(a) environmental statutes, guidelines and regulations;
(b) work permit conditions for lakes and streams; and
(c) work restrictions relating to forest fire hazards.
4. RIGHT OF ENTRY
4.1 For so long as the Option continues in full force and effect, Iconet,
its employees, agents, permitted assigns and independent contractors
shall have the right to:
(a) enter upon the Property;
(b) have exclusive and quiet possession of the Property;
(c) incur expenditures;
(d) bring upon and erect upon the Property such mining facilities as Iconet
may consider advisable; and
(e) remove from the Property and sell or otherwise dispose of mineral
products.
5. REGISTRATION AND TRANSFER OF PROPERTY INTERESTS
5.1 Upon the request of ICONET, the Vendor shall assist ICONET to record
this Agreement with the appropriate mining recorder. Iconet will be
responsible for all reasonable costs associated with this registration.
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5.2 Until ICONET fully exercises the Option hereunder, title to the
Property shall remain in the name of the Vendor. At such time as ICONET
fully exercises the Option, the Vendor agrees to deliver or arrange for
delivery of duly executed and recordable transfers transferring an
undivided 100% interest in the Property to Iconet within 10 days of the
complete exercise of the Option. Iconet will be responsible for all
reasonable costs associated with recording this transfer.
6. COVENANTS
6.1 During the currency of this Agreement and the Option, the Vendor
covenants and agrees with Iconet to:
(a) refrain from doing any act or thing which would prevent Iconet from
exercising its rights in accordance with the terms and conditions of
this Agreement, provided ICONET has and continues to meet all of its
obligations hereunder;
(b) make available to ICONET and its representatives all records and files
relating to the Property and permit Iconet and its representatives at
its own expense to take abstracts therefrom and make copies thereof;
and
(c) promptly provide ICONET with any and all notices and correspondence
from Government agencies in respect of the Property.
6.2 During the currency of this Agreement and the Option, ICONET covenants
and agrees with the Vendor to:
(a) keep the Property in good standing, and free and clear of all liens,
charges and encumbrances arising from its own operations hereunder and
in good standing by the doing and filing of all necessary work and by
the doing of all other acts and things and making all other payments
which may be necessary in that regard;
(b) permit the Vendor, or its representatives duly authorized by it in
writing, at their own risk and expense, access to the Property at all
reasonable times and to all records prepared by Iconet in connection
with the work done on or with respect to the Property and furnish the
Vendor with annual reports and copies of all data (upon request), in
written and electronic format with respect to the work carried out by
Iconet on or with respect to the Property and results obtained,
together with timely current reports and information on any material
results obtained; and
(c) furnish to the Vendor as soon as practical in each year but not later
than sixty (60) days after the fiscal year end of Iconet a
comprehensive report in written and in electronic format on the work
carried out by ICONET on or with respect to the Property during the
preceding year and results obtained.
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7. RIGHT OF ASSIGNMENT
7.1 ICONET may not sell, transfer and otherwise assign any or all of its
rights under this Agreement without prior notice to or the prior
written consent of the Vendor.
8. DEFAULTS IN PAYMENT OF OPTION PRICE
8.1 The Option shall terminate if Iconet fails to make any of the payments
of the Option Price in accordance with paragraph 2.1 herein within the
time periods specified therein.
8.2 If ICONET shall be in default of any requirement other than those set
forth in paragraph 2.1 herein, the Vendor shall give written notice to
ICONET specifying the default, and Iconet shall not lose any rights
granted under this Agreement, unless within thirty calendar days after
the giving of notice of default by the Vendor, ICONET has failed to
cure the default by the appropriate performance.
9. FORCE MAJEURE
9.1 ICONET shall not be liable to the Vendor, and shall not be deemed in
default hereunder for any failure or delay to pay any portion of the
Option Price if, prior to payment thereof, any dispute as to ownership
or title to the Property or the minerals therein arises. All times
provided for in this Agreement shall be extended for the period
commensurate with the period of the delay and, so far as possible, both
parties shall take all reasonable steps to remedy the delay caused by
the events referred to above.
9.2 Neither party shall be liable to the other party hereto and neither
party shall be deemed in default hereunder for any failure or delay to
perform any of its covenants and agreements hereunder caused or arising
out of any act not reasonably within the control of such party,
excluding lack of funds but including without limitation acts of God,
strikes, lockouts or other industrial disputes, acts of public enemies,
native land claims, blockades, disputes as to Property ownership, war,
riots, fire, storm, flood, explosion, government restriction or the
obtaining of governmental approvals unavailability of equipment or
other causes whether of the kind enumerated above or otherwise. The
party affected shall give prompt notice to the other party of the
commencement and termination of one of the events referred to above. No
right of a party shall be affected for failure or delay of a party to
meet any condition of this Agreement, if the failure or delay is caused
by one of the events referred to above. All times provided for in this
Agreement shall be extended for the period commensurate with the period
for the delay and, so far as possible, the party affected shall take
all reasonable steps to remedy the delay caused by the events referred
to above.
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10. RETURN OF PROPERTY
10.1 In the event that ICONET should decide that it shall not proceed with
the Option, then it will cease to use and shall deliver to the Vendor
all reports, maps, drill logs, core assay results and any other
relevant technical data in written and electronic format compiled by
Iconet with respect to the Property.
11. MISCELLANEOUS
11.1 Time is of the essence of this Agreement except as otherwise provided
for in this Agreement.
11.2 The parties hereto agree that they and each of them will execute all
documents and do all acts and things within their respective powers to
carry out and implement the provisions or intent of this Agreement.
11.3 Any notice to be required hereunder will be in writing and sent by
delivery, facsimile transmission, or prepaid registered mail addressed
to the party entitled to receive the same or delivered to such party at
the address specified above, or to such other address as either party
may give to the other for that purpose. The date of receipt of any
notice, demand or other communication hereunder will be the date of
delivery if delivered, the date of transmission if sent by facsimile
or, if given by registered mail as aforesaid, will be the date on which
the notice, demand or other communication is actually received by the
addressee.
11.4 This Agreement supersedes any other agreement or arrangement, whether
oral or written, heretofore existing between the parties in respect of
the Property.
11.5 This Agreement shall enure to the benefit of and be binding upon the
parties hereto and their respective heirs, executors, successors and
permitted assigns.
11.6 This Agreement shall be interpreted and construed in accordance with
the laws of USA and the parties hereto shall attorn to the courts
thereof.
11.7 All amounts set forth in the Agreement are expressed in US dollars.
11.8 This Agreement and the performance of the covenants and obligations of
ICONET hereunder are expressly conditional upon the acceptance for
filing of this Agreement by the Exchange, which acceptance ICONET
agrees to take all reasonably necessary steps to secure forthwith.
11.9 This Agreement may be executed by the parties in counterparts and, when
so executed, such parts taken together shall comprise a completely
executed agreement.
If the above terms and conditions accurately record your understanding of our
agreement, please so acknowledge by signing a copy of this Agreement in the
space provided and returning the same to us at your earliest convenience. Upon
your execution thereof, this Agreement will constitute a legal and binding
agreement in accordance with its terms.
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Yours truly,
ICONET INCORPORATION.
/s/ RANDY MILLER
____________________
Randy Miller
Authorized Signatory
THE FOREGOING IS HEREBY CONFIRMED, ACKNOWLEDGED AND ACCEPTED THIS 12TH DAY OF
JUNE, 2002:
SEA EMERALD DEVELOPMENT CORP.
Per: /s/
_________________________________________
Authorized Signatory
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SCHEDULE "A"
DESCRIPTION OF PROPERTY
The Property includes mineral claim located in Langmuir Township, Porcupine
Mining Division, Ontario described as follows:
________________________________________________________________________________
AREA RECORD NO. HOLDER (100%)
________________________________________________________________________________
________________________________________________________________________________
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SCHEDULE "B"
AGREEMENTS/OPTIONS
THERE WILL BE A 5% NSR IN FAVOR OF THE VENDOR. ICONET INC MAY PURCHASE 2% FOR 2
MILLION DOLLARS US IN ONE LUMP SUM AT ANYTIME .