Option Agreement Between Quincy Gold Corp. And NZ Uranium LLC Dated May 12, 2005.

Exhibit 10.14


OPTION AGREEMENT


THIS AGREEMENT made as of the 12th day of May, 2005


BETWEEN:


NZ URANIUM, LLC , a limited liability company organized under the laws of the State of Arizona and having an office for business located at 3514 East Presidio Circle, Mesa, Arizona 85213


(the " Optionor" )


OF THE FIRST PART


AND:


QUINCY GOLD CORP. , a corporation incorporated under the laws of the State of Nevada and having an office for business located at 309 Center Street, Hancock, Michigan


(the "Optionee")


OF THE SECOND PART


WHEREAS:


A.

The Optionor owns a fee simple interest in the Crownpoint Property (as more specifically defined in Section 1.1) located in McKinley County, New Mexico totaling approximately 1,099.24 acres as more particularly described in Schedule " A" attached hereto;


B.

The Optionor has determined to grant the Optionee an exclusive option to earn an interest in the Property, on and subject to the terms of this agreement.


NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the sum of $1.00 now paid by the Optionee to the Optionor and other good and valuable consideration (the receipt and sufficiency of which is hereby acknowledged), the parties agree as follows:


ARTICLE 1
INTERPRETATION


Definitions


1.1

For the purposes of this Agreement the following words and phrases shall have the following meanings, namely:


(a)

" Area of Mutual Interest" means four (4) miles from the outer boundary of the Property;


2


(b)

"Exchange" means the TSX Venture Exchange;


(c)

" Exploration and Development" means, inter alia, all direct and indirect property preparation, analysis (and activities incident thereto), exploration, administration and filing work and expenditures conducted and incurred by the Optionee, at its instruction, or on its behalf, or by assignment to another party pursuant to Section 16.1 hereof, for the purpose of determining the existence of mineral deposits of a commercial nature on the Property;


(d)

"Exploration Expenditures" means all cash, expenses, obligations and liabilities of whatever kind or nature spent or incurred directly or indirectly by the Optionee in connection with the Exploration and Development of the Property, including without limiting the generality of the foregoing, monies expended in maintaining the Property in good standing by doing and filing assessment work, in doing geophysical, geochemical and geological surveys, drilling, assaying and metallurgical testing, in acquiring facilities, in paying the fees, wages, salaries, travel expenses and fringe benefits (whether or not required by law) of all persons engaged in work with respect to and for the benefit of the Property, in paying for the food, lodging and other reasonable needs of such persons, and in supervision of management of all work done with respect to and for the benefit of the Property; provided, howeve r, that the Optionee shall be entitled to credit towards Exploration Expenditures of its administrative or overhead expenses which shall not exceed 10% of the Exploration and Development expenses incurred directly on the Property. In the event that the Optionor disputes any Exploration Expenditures the Optionor may notify the Optionee thereof in writing and the Optionee shall provide the Optionor with reasonable access to its books and records relating to the disputed Exploration Expenditures for the purpose of conducting an audit of same, which shall be performed by a Certified Public Accountant or Chartered Accountant acceptable to the Optionee, acting reasonably. In the event that the amount of Exploration Expenditures reported by the auditor are less than those reported by the Optionee, the Exploration Expenditures shall be deemed to be that lower figure and, if (but only if) the discrepancy is greater than 10%, the Optionee shall be responsible for paying the costs of such report;


(e)

" Feasibility Study" means a study that has been vetted by a recognized independent minerals industry consulting firm and in a form customarily required by third-party financing organizations showing the feasibility of placing the Property into production, in such form and detail and using such assumption as to mineral prices customarily used in determining the viability of mining projects such as the Property and including a reasonable assessment of the mineable mineral reserves and their amenability to in situ leaching or milling, a complete description of the work, equipment and supplies required to bring the Property into production and the estimated cost thereof, a description of the mining methods to be employed and a financial appraisal of the proposed operations supported by explanations of the following information


3


(i) a description of that part of the Property to be covered by the proposed mine,


(ii) the estimated recoverable reserves of minerals and the estimated composition and content thereof, including the effect of grade, dilution and impurities,


(iii) the proposed procedure for development, mining and production,


(iv) results of milling amenability tests (if any),


(v) the nature and extent of the facilities, if any, proposed to be acquired which may include mill facilities, if the size, extent and location of the ore body makes such mill facilities necessary or desirable, in which event the study shall also include a preliminary design for such mill, and the proposed mill site location, if any, or appropriate provisions for custom milling facilities,


(vi) the total costs, including capital budget, which are reasonably required to purchase, construct and install all structures, machinery and equipment required for the proposed mine, including a schedule of timing of such requirements,


(vii) the results of all environmental impact studies for the Property and costs of such studies,


(viii) the period in which it is proposed the Property shall be brought to production,


(ix) working capital requirements for the initial four (4) months of operation of the Property as a mine or such longer period as may be reasonably justified in the circumstances by the party doing the study,


(x) estimates of shutdown and reclamation costs, and


(xi) the net present value of the Property.


(f)

" Mineral Estate" means uranium bearing ore and any and all other metallic elements and rights, of whatever nature and kind, situated in, upon or under the Property, whether surface or subsurface, together with the right to use so much of the surface of the Property as is necessary, useful, convenient or incidental to explore for, develop, exploit or produce from such mineral estate, but specifically excluding hydrocarbons, coal, gases and industrial minerals;


(g)

"Operating Agreement" means the form of operating agreement governing the relationship of the parties in respect of the Property following the due exercise of


4


the Option to be agreed to by the parties prior to the Subject Removal Date;


(h)

" Operator" means that person or company acting as such pursuant to this Agreement;


(i)

"Option" means the exclusive option granted to the Optionee to acquire a 65% undivided interest in the Property, as provided in this Agreement;


(j)

"Option Period" means the period from the date of this Agreement to and including the date of exercise or termination of the Option, with such outside date as is set forth in this Agreement;


(k)

"Programs" means the plans, including budgets, for every kind of work done on or in respect of the Property by or under the direction of or on behalf of or for the benefit of a party, and, without limiting the generality of the foregoing, includes assessment work, geophysical, geochemical and geological surveying, studies and mapping, investigating, drilling, designing, examining, equipping, improving, surveying, shaft sinking, raising, cross-cutting and drifting, searching for, digging, trucking, sampling, working and procuring minerals, ores, metals and concentrates, surveying and bringing any mineral claims to lease or patent, reporting, and all other work usually considered to be prospecting, exploration, development and mining work;


(l)

" Property" means the Mineral Estate in the lands described in Schedule " A" attached hereto, together with: i) all rights, benefits, privileges, easements, tenements, hereditaments, appurtenances and other interests therein or relating thereto; ii) all Water Rights appurtenant to or used on or in connection with such Property; and iii) includes the Mineral Estate in any properties within the Area of Mutual Interest around the lands described in Schedule " A" attached hereto becoming subject to this Agreement by operation of Article 15 hereof;


(m)

" SEC Filings" means the Optionee' s public filings (as amended from time to time) with the United States Securities and Exchange Commission pursuant to the Securities Act of 1934;


(n)

"Shares" means the shares of the Optionee' s voting common stock, par value $0.001;


(o)

" Subject Removal Date" and " Title Report" have the meanings ascribed in Article 2 hereof; and


(p)

" Water Rights" means all water and water rights, ditch and ditch rights, wells and well structures, whether adjudicated or not and whether permitted or not, easements and rights of way associated with such water rights, if any, appurtenant to or used on or in connection with the Property.


Any other terms defined within the text of this Agreement will have the meanings so ascribed to


5


them.


Captions and Section Numbers


1.2

The headings and section references in this Agreement are for convenience of reference only and do not form a part of this Agreement and are not intended to interpret, define or limit the scope, extent or intent of this Agreement or any provision thereof.


Section References and Schedules


1.3

Any reference to a particular " Article" , " Section" , " Paragraph" , " clause" or other subdivision is to the particular Article, Section, clause or other subdivision of this Agreement and any reference to a Schedule by letter will mean the appropriate Schedule attached to this Agreement and by such reference the appropriate Schedule is incorporated into and made part of this Agreement. The Schedules to this Agreement are as follows:


Schedule " A"

Property


Severability of Clauses


1.4

If any part of this Agreement is declared or held to be invalid for any reason, such invalidity will not affect the validity of the remainder which will continue in full force and effect and be construed as if this Agreement had been executed without the invalid portion, and it is hereby declared the intention of the parties that this Agreement would have been executed without reference to any portion which may, for any reason, be hereafter declared or held to be invalid.


Currency


1.5

All references herein to currency are references to United States dollars.


ARTICLE 2
CONDITIONS PRECEDENT


Condition Precedent to the Obligations of the Optionee

2.1

All Obligations of the Optionee hereunder are expressly subject to:

(a)

the Optionee, at is own cost and expense, obtaining a title report (and, if required, title insurance), in form and substance acceptable to the Optionee, that the Property is free and clear of all liens, charges and encumbrances, save and except for the interest, if any, of the Comerica Bank in and to the Property (a " Title Report" ). The Optionee shall use its commercially reasonable efforts to obtain such report as quickly as possible, and in any event must acquire the Title Report within 90 days of the date hereof (such latter date being the " Subject Removal Date" );


6


(b)

the Optionee completing a satisfactory due diligence review of the Property, on or before the Subject Removal Date; and

(c)

the Optionor obtaining, on or before the Subject Removal Date, a written consent or other document, in form and substance acceptable to the Optionee, acting reasonably, from Comerica Bank releasing the Property from any and all security interests which Comerica Bank may have in or to the Property.

Condition Precedent to the Obligations of the Parties

2.2

All obligations of the parties hereunder are expressly subject to the parties agreeing to a form of Operating Agreement (as defined herein), and the parties agree to use their commercially reasonable best efforts to agree to same on or before the Subject Removal Date which Operating Agreement shall be deemed to be attached to and form part of this Agreement.

Waiver of Conditions Precedent

2.3

The conditions precedent set out in the preceding Sections are inserted for the exclusive benefit of the parties referenced therein and any such condition may be waived in whole or in part by such party on or prior to the Subject Removal Date by delivering to the other party a written waiver to that effect. In the event that the conditions precedent set out in the preceding Section are not satisfied on or before the Subject Removal Date, all parties shall be released from all obligations under this Agreement.

Nature of Conditions Precedent

2.4

The conditions precedent set forth in this Article 2 are conditions of completion of the transactions contemplated by this Agreement and are not conditions precedent to the existence of a binding agreement. Each party acknowledges receipt of the sum of $1.00 and other good and valuable consideration as separate and distinct consideration for agreeing to the conditions precedent in favor of the other party or parties set forth in this Article.


ARTICLE 3
REPRESENTATIONS, WARRANTIES AND

COVENANTS OF THE OPTIONOR


Representations


3.1

The Optionor represents and warrants to and covenants with the Optionee, with the knowledge that the Optionee relies upon same in entering into this Agreement, that:


(a)

it has been duly organized and validly exists as a limited liability company in good standing under the laws of its jurisdiction of organization;


(b)

it has full limited liability company power and capacity to enter into this


7


Agreement and it has duly obtained all limited liability company authorizations for the execution of this Agreement and for the performance of this Agreement by it, and the consummation of the transactions herein contemplated will not conflict with or result in any breach of any covenants or agreements contained in, or constitute a default under, or result in the creation of any encumbrance under the provisions of the Articles or the organizational documents of the Optionor or any members' or managers' resolution, or material indenture, agreement or other instrument whatsoever to which the Optionor is a party or by which it is bound or to which it may be subject;


(c)

the entering into and the performance of this Agreement and the transactions contemplated herein will not result in the violation of any judgment, decree, order, rule or regulation of any court or administrative body by which the Optionor is bound, or any statute or regulation applicable to the Optionor;


(d)

no proceedings are pending for, and the Optionor is unaware of any basis for the institution of any proceedings leading to, the dissolution or winding up of the Optionor or the placing of the Optionor in bankruptcy or subject to any other laws governing the affairs of insolvent corporations;


(e)

to the best of the Optionor's knowledge, there are no outstanding work orders or actions specific to the Property required by any governmental agency, to be taken relating to environmental matters, or any existing condition on the Property which it has been advised could be the basis therefor, in respect to the Property or any operations thereon and that it has no knowledge of any other material adverse environmental issues affecting the Property;


(f)

to the best of the Optionor's knowledge the Optionor owns the Property, free and clear of all liens, charges and encumbrances save and except as set forth in Schedule " A" attached hereto or as disclosed in the Title Report;


(g)

the best of the Optionor's knowledge, ingress and egress to the Property, as is reasonably necessary for the purpose of exploring, developing, exploiting or operating the Property, is provided by public roads and/or easement rights that are appurtenant to the Property;


(h)

during the Option Period the Optionor shall not take any action which would cause a representation or warranty of the Optionor to become untrue and shall do all such acts and things, including the payment of all required property taxes, as are reasonably necessary in order to ensure that representations and warranties of the Optionor contained in paragraphs (a), (b), (c), (d) remain true and correct through such Option Period in respect of the Property;


(i)

the Optionor is not party to any agreement which provides for the payment of finder' s fees, brokerage fees, commissions or other fees or amounts which are or may become payable to any third party in connection with the execution and delivery of this Agreement and the transactions contemplated herein;


8


(j)

the best of the Optionor's knowledge the Optionor is the lawful owner of, has good legal and beneficial title to, and has the right to dispose of its interests in and to the Property, and upon exercise of the Option to give good and marketable title thereto to the Optionee, free and clear of all liens, charges, encumbrances, obligations and any other royalties or restrictions save and except for any liens, charges, encumbrances, obligations and any other royalties or restrictions as set forth in Schedule " A" attached hereto or as disclosed in the Title Report; and


(k)

there is no litigation or proceeding existing against the Optionor or the Property; the Optionor, to the best of its knowledge, is unaware of any pending or threatened litigation, proceeding or investigation against the Optionor or the Property, nor does the Optionor know, or have any grounds to know after due inquiry, of any basis for any litigation which would affect any of forgoing.


Survival


3.2

The representations and warranties contained in this Section are provided for the exclusive benefit of the Optionee, and a breach of any one or more thereof may be waived by the Optionee in whole or in part at any time without prejudice to its rights in respect of any other breach of the same or any other representation or warranty, and the representations and warranties contained in this Section shall survive the execution of this Agreement and of any transfers, assignments, deeds or further documents respecting the Property.


ARTICLE 4
REPRESENTATIONS, WARRANTIES AND

COVENANTS OF THE OPTIONEE


Representations


4.1

The Optionee represents and warrants to and covenants with the Optionor, with the knowledge that the Optionor relies upon same in entering into this Agreement, that:


(a)

it has full corporate power and capacity to enter into this Agreement and it has been duly incorporated, amalgamated or continued and validly exists as a corporation in good standing with respect to the filing of annual reports under the laws of its jurisdiction of incorporation, amalgamation or continuation;


(b)

it has duly obtained all corporate authorizations for the execution of this Agreement and for the performance of this Agreement by it, and the consummation of the transactions herein contemplated will not conflict with or result in any breach of any covenants or agreements contained in, or constitute a default under, or result in the creation of any encumbrance under the provisions of the Articles or the constating documents of the Optionee or any shareholders' or directors' resolution, indenture, agreement or other instrument whatsoever to


9


which the Optionee is a party or by which it is bound or to which it may be subject;


(c)

the entering into and the performance of this Agreement and the transactions contemplated herein will not result in the violation of any judgment, decree, order, rule or regulation of any court or administrative body by which the Optionee is bound, or any statute or regulation applicable to the Optionee;


(d)

the authorized capital of the Optionee consists of 200,000,000 shares of common stock, par value $0.001, and no shares of preferred stock, of which 40,230,997 shares are issued outstanding as at the date hereof;


(e)

no person, firm or corporation has any agreement or option or any right capable of becoming an agreement or option for the purchase, subscription or issuance of any of the unissued shares in the capital of the Optionee, save and except as set forth in the SEC Filings;


(f)

the Optionee is not party to any agreement which provides for the payment of finder' s fees, brokerage fees, commissions or other fees or amounts which are or may become payable to any third party in connection with the execution and delivery of this Agreement and the transactions contemplated herein;


(g)

no proceedings are pending for, and the Optionee is unaware of any basis for the institution of any proceedings leading to, the dissolution or winding up of the Optionee or the placing of the Optionee in bankruptcy or subject to any other laws governing the affairs of insolvent corporations; and


(h)

the Optionee has duly filed all reports to be filed by it with the Exchange, the Securities Exchange Commission under the Securities Exchange Act of 1934, as amended, and no such reports contain any untrue statement of material fact or omits to state any material fact required to be stated therein or necessary to make the statements in such report, in light of the circumstances under which they were made, not misleading at the time such reports were filed.


Survival


4.2

The representations and warranties contained in this Section are provided for the exclusive benefit of the Optionor and a breach of any one or more thereof may be waived by the Optionor in whole or in part at any time without prejudice ...