EX-10.5 6 ex10-5.txt EXHIBIT 10.5 EXPENDITURE AND INVESTMENT AGREEMENT EXHIBIT 10.5 EXPENDITURE AND INVESTMENT AGREEMENT This Agreement dated June 3, 2005 ------------ BETWEEN: CHINA NETTV HOLDINGS INC., a Nevada company with offices at 536-999 Canada Place, Vancouver, British Columbia, V6C 3E2 Fax: (604) 641-1377 (herein called "China Net") AND: Xi Hua MINGING DEVELOPMENT INC., a Chinese corporation with a business addresses at Jin Zhu West Road # 75, Lhasa, Tibet, China (herein called "Xihua") WHEREAS: A. Xihua holds valid exploration permits (the "Permits", copies of which are attached hereto as Schedule "A") issued by Tibet Office of Ministry of Land and Recourses , covering certain mineral properties located in Tibet, China, known as Donggapu as more particularly described in Schedule "B" attached hereto (the "Property"). B. China Net and Xihua have entered into a Mineral Properties Lease and Option Agreement (the "Properties Agreement") dated April 8, 2005 whereby Xihua has granted to China Net an exclusive leasehold interest in and option to the Properties, and China Net has agreed to incur certain exploration expenditures on the Properties C. China Net and Xihua have now agreed to enter into this Agreement in relation to the exploration expenditures that China Net will invest in or incur in relation to the Properties. - 2 - NOW THEREFORE THIS AGREEMENT WITNESSETH THAT for valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties do hereby mutually covenant and agree as follows: 1. Advance of Funds: 1.1 China Net will, within 14 days of the date of this Agreement, forward US$1,200 ("Initial Funds") to a designated account of Xihua in China, to be used for the exclusive purposes of exploration and related activities on Donggapu Deposit . China Net may, in its discretion, advance such further funds at such and in such amounts not to exceed US$449,214 in total according to the budget for 2005, depending on the progress and result of exploration on the Properties. . 1.2 Xihua shall confirm to China Net in writing of its receipt of the Initial Funds immediately upon its receipt thereof, and, if it has not done so, shall forward to China Net within reasonable period of time, copies of complete books and records in relation to any expenditures it has incurred in relation to the Properties since the date of the Properties Agreement. 2. Xihua covenants with China Net that: 2.1 it will conduct its business only in the usual and ordinary course of business consistent with past practices and will use all commercially reasonable efforts to maintain and preserve its business organization, goodwill, assets, and advantageous business relationships; 2.2 other than in the ordinary course of business, except as is necessary to comply with applicable law or with respect to existing provisions of any existing plans, programs, arrangements or agreements, it will not grant any officer, director, employee or consultant an increase in compensation in any form; 2.3 it will promptly notify China Net in writing of any material change (actual, anticipated, or contemplated) in its business, operations, affairs, assets, financial condition, licences, permits, rights, privileges or liabilities, whether contractual or otherwise; 2.4 it will only use the Initial Funds (or cause such funds to be used) for the purpose of exploration and related activities on the Properties, as may be agreed to or directed by China Net or its engineers, geologists or other consultants; 2.5 it will keep accurate and complete records of the use of the Initial Funds and permit China Net, when it so requests, to inspect the records; 2.6 it will complete such filing or registration as may be required under applicable Chinese laws or regulations for the transfer of the funds including the Initial Funds, so that such funds transferred to Xihua may be recognised either as loan or as contribution to the registered capital of a Chinese company with foreign investment to be established by either or both parties. - 3 - 3. Further Documents Parties agree to do such things and sign such further documents to complete the transactions contemplated herein and in the Mineral Properties Lease and Option Agreement. 4. Counterparts This Agreement may be executed in counterpart and by facsimile transmission with the same effect as if both parties had originally signed the same document. All counterparts will be construed together and constitute one and the same agreement. IN WITNESS WHEREOF the Parties hereto have duly executed this Agreement as of the dates detailed below. CHINA NETTV HOLDINGS INC. Per: ------------------------------------ Authorized Signatory Printed Name and Title: --------------------------- XIHUA MINIG INVESTMENT HOLDINGS INC Per: /s/ Du Yan Guang ----------------------------------- Authorized Signatory Printed Name and Title: Du Yan Guang, Legal Representative ---------------------------
Schedule B ------------------------------------------------------------------------------------------------------------------------------- Minimum spending SR No. Area (Req. Name of Properties Owner-ship Minerals (sq. Period of validity State ann.) Certificate /Title km) Investment USD number ------- -------------------- ---------- ---------- -------- ----------------------- ------------- ------------ ---------------- ------- -------------------- ---------- ---------- -------- ----------------------- ------------- ------------ ---------------- 1 DONGGAPU Xihua Au Cu 21.89 2003.11.24--2005.12.31 26,695.12 5400000310745 ------- -------------------- ---------- ---------- -------- ----------------------- ------------- ------------ ---------------- Total 21.89 26,695.12 ---------------------------- ---------- ---------- -------- ----------------------- ------------- ------------ ---------------- 1 US$ = 8.2 Yuan RMB