SHARE PURCHASE AND SALE AGREEMENT
MADE
OCTOBER 21, 1998
AMONG
CORNUCOPIA RESOURCES INC.
AND
CORNUCOPIA RESOURCES LTD.
AND
VISTA GOLD HOLDINGS INC.
AND
VISTA GOLD CORP.
IN RESPECT OF THE SHARES OF
MINERAL RIDGE RESOURCES INC.
TABLE OF CONTENTS
PART 1 - DEFINITIONS AND INTERPRETATION.................................2
1.1 Definitions....................................................2
1.2 Interpretation.................................................6
PART 2 - PURCHASE AND SALE..............................................7
2.1 Purchase and Sale of Purchased Shares..........................7
PART 3 - REPRESENTATIONS AND WARRANTIES.................................7
3.1 Representations and Warranties of the Vendor and CRL...........7
(1) Corporate Status and Authority...........................7
(2) No Default...............................................8
(3) Share Capital............................................9
(4) Financial Matters........................................9
(5) Inventory...............................................10
(6) Material Changes........................................10
(7) Banking.................................................11
(8) Material Contracts......................................12
(9) Assets and Property.....................................12
(10) Hazardous Materials and Environmental Laws..............13
(11) Legal and Regulatory Matters............................13
(12) Taxation................................................14
(13) Employment Matters......................................15
(14) Insurance...............................................16
(15) Binding Agreement.......................................16
(16) Ownership of Purchased Shares...........................16
(17) Residency...............................................16
(18) No Commission...........................................17
(19) Approvals...............................................17
(20) Representations and Warranties of Mineral Ridge in
Restated and Amended Loan Agreement......17
(21) Securities Laws.........................................17
3.2 Representations and Warranties of the Purchaser and VGC.......21
(1) Corporate Status and Authority..........................21
(2) No Default..............................................21
(3) Binding Agreement.......................................21
(4) Share Capital...........................................22
(5) Disclosure Documents....................................22
(6) No Encumbrances on VGC Shares...........................22
(7) Listing of VGC Shares...................................22
(8) Reporting Issuer Status.................................22
(9) No Commission...........................................22
PART 4 - COVENANTS.....................................................23
4.1 Covenants of the Vendor and CRL...............................23
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(1) Agreement Date to Closing...............................23
(2) At Closing..............................................25
4.2 Covenants of the Purchaser and VGC............................26
(1) General.................................................26
(2) At Closing..............................................26
PART 5 - CONDITIONS PRECEDENT..........................................27
5.1 Mutual Conditions Precedent...................................27
5.2 Conditions for the Benefit of the Vendor and CRL..............28
5.3 Conditions for the Benefit of the Purchaser and VGC...........30
PART 6 - SURVIVAL OF REPRESENTATIONS AND INDEMNITY.....................33
6.1 Survival of Representations, Warranties and Covenants.........33
6.2 Indemnity.....................................................33
PART 7 - GENERAL.......................................................33
7.1 Time and Place of Closing.....................................33
7.2 Notices.......................................................33
7.3 Confidentiality and Disclosure................................35
7.4 Dispute Resolution and Arbitration............................35
7.5 Governing Law.................................................35
7.6 Binding Effect................................................35
7.7 Time of Essence...............................................36
7.8 Assignment....................................................36
7.9 Further Assurances............................................36
7.10 Expenses......................................................36
7.12 Entire Agreement..............................................36
7.11 Counterparts and Facsimile....................................37
SCHEDULE "A" - FINANCIAL STATEMENTS....................................A-1
SCHEDULE "B" - LOANS AND CREDIT FACILITIES.............................B-1
SCHEDULE "C" - BANK FACILITIES.........................................C-1
SCHEDULE "D" - MATERIAL CONTRACTS......................................D-1
SCHEDULE "E" - MATERIAL CONTRACTS IN BREACH OR DEFAULT.................E-1
SCHEDULE "F" - MINERAL RIGHTS AND LANDS................................F-1
SCHEDULE "G" - ROYALTY INTERESTS.......................................G-1
SCHEDULE "H" - EQUIPMENT...............................................H-1
SCHEDULE "I" - LITIGATION..............................................I-1
SCHEDULE "J" - EMPLOYMENT CONTRACTS....................................J-1
SCHEDULE "K" - INSURANCE...............................................K-1
SCHEDULE "L" - PERMITTED ENCUMBRANCES..................................L-1
SCHEDULE "M" - APPROVALS...............................................M-1
SCHEDULE "N" - VGC SUBSCRIPTION AGREEMENT..............................N-1
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SHARE PURCHASE AND SALE AGREEMENT
THIS AGREEMENT made the 21st day of October, 1998
AMONG:
CORNUCOPIA RESOURCES INC., a company incorporated under the
laws of the State of Nevada and having an office at Suite
540, Marine Building, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇
(the "VENDOR")
AND:
CORNUCOPIA RESOURCES LTD., a company amalgamated under the
laws of the British Columbia and having an office at Suite
540, Marine Building, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇
("CRL")
AND:
VISTA GOLD HOLDINGS INC., a company incorporated under the
laws of the State of Nevada and having an office at Suite
3000, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇.▇.▇.
(the "PURCHASER")
AND:
VISTA GOLD CORP., a company continued under the laws of the
Yukon Territory and having an ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇.▇.▇.
("VGC")
WHEREAS:
A. the Vendor is the legal and beneficial holder of all of the issued
and outstanding shares in the capital of Mineral Ridge;
B. the Purchaser has agreed to purchase and the Vendor has agreed to
sell all of the issued and outstanding shares in the capital of Mineral Ridge
on the terms, at the time and subject to the conditions set forth herein;
C. the Vendor is a wholly-owned subsidiary of CRL and the Purchaser is
a wholly-owned subsidiary of VGC;
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NOW THEREFORE THIS AGREEMENT WITNESSES THAT in consideration of the premises
and mutual covenants and agreements contained herein, and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto hereby covenant and agree as follows:
PART 1
DEFINITIONS AND INTERPRETATION
1.1 DEFINITIONS
In this Agreement and the recitals hereto, unless the context
otherwise requires, the following terms shall have the following respective
meanings:
(a) "ACCREDITED INVESTOR" means an "accredited investor" as that term is
defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the
U.S. Securities Act;
(b) "ASSETS" means all of the rights, properties, undertakings and assets
of Mineral Ridge, whether or not used in connection with or relating
to the Business, whether real or personal, tangible or intangible, and
whether owned, leased or licensed, including, without limitation, all
Mineral Rights, Lands and Equipment;
(c) "BUSINESS" means all the business carried on by Mineral Ridge as of
the date of this Agreement, including, without limitation, mineral
exploration and mining;
(d) "BUSINESS DAY" means any day, other than Saturday, Sunday or a
statutory holiday in the Province of British Columbia;
(e) "CLAIM" means any claim, demand, action, cause of action, damage,
loss, cost, liability or expense, including, without limitation,
reasonable professional fees and all costs incurred in investigating
or pursuing any of the foregoing or any proceeding relating to any of
the foregoing;
(f) "CLOSING" means the closing of the purchase and sale of the Purchased
Shares contemplated herein;
(g) "CLOSING DATE" means October 21, 1998 or such other date as the
parties hereto may agree;
(h) "CONSTATING DOCUMENTS" means the memorandum, articles, articles of
incorporation, articles of continuance or articles of amalgamation
pursuant to which a corporation is incorporated, continued or
amalgamated, as the case may be, together with any amendments thereto,
and the by-laws of such corporation and any shareholders' agreement
which has been executed by such corporation or which governs in whole
or in part such corporation's affairs;
(i) "CRL SHARES" means the 2,777,777 common shares in the capital of CRL
to be issued to VGC pursuant to the VGC Subscription Agreement;
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(j) "DRESDNER" means Dresdner Bank AG, New York and Grand Cayman Branches;
(k) "DRESDNER LOAN AGREEMENT" means the loan agreement dated January 17,
1997 between Mineral Ridge and Dresdner;
(l) "ENCUMBRANCE" means any mortgage, charge, pledge, hypothec, security
interest, lien, easement, right-of-way, encroachment, covenant,
condition, right of re-entry, lease, license, assignment, option,
claim, encumbrance, set-off, escrow, hold period, voting agreement,
voting trust or other limitation, restriction or title defect of
whatever kind or nature, regardless of form, whether or not registered
or registrable and whether or not consensual or arising by law or
pursuant to the by-laws, rules or policies of any stock exchange, and
whether known or unknown at the time of Closing;
(m) "ENVIRONMENTAL CONTAMINATION" means the discharge, emission, leaking,
spilling, leaching, release or discharge into the environment,
including, without limitation, land, air and water, of Hazardous
Materials or other material, so as to result in any harm, damage or
hazard to the environment or to any person, property or thing;
(n) "ENVIRONMENTAL LAWS" means all Laws or lawful requirements of any
Governmental Authority with respect to environmental and health
protection or regulating Hazardous Materials;
(o) "EQUIPMENT" means all supplies and all machinery, equipment,
automobiles, trucks, bulldozers, shovels, trailers, tractors, office
equipment, computer hardware and software, yard equipment, furniture,
furnishings and tools of all kinds owned or leased by Mineral Ridge,
the Vendor and CRL and used or intended for use in connection with the
Business;
(p) "FINANCIAL STATEMENTS" means the unaudited financial statements of
Mineral Ridge as at July 31, 1998 attached hereto as Schedule "A"
hereto;
(q) "GOVERNMENTAL AUTHORITY" means any federal, provincial, state,
municipal, county or regional governmental or quasi-governmental
authority, domestic or foreign, and includes any ministry, department,
commission, bureau, board, administrative or other agency, regulatory
body or instrumentality thereof, including, without limitation, any
securities commission, stock exchange or other securities regulatory
authority, whether a self-regulating body or otherwise;
(r) "GOVERNMENTAL AUTHORIZATIONS" means all authorizations, approvals,
licenses, permits or quotas issued to Mineral Ridge primarily in
connection with the Business or any of the Assets by any Governmental
Authorities;
(s) "HAZARDOUS MATERIALS" means any asbestos materials, urea formaldehyde,
explosives, radioactive materials, pollutants, contaminants, hazardous
substances, corrosive substances, toxic substances, special wastes or
wastes of any kind, including, without limitation, compounds known as
chlorobiphenyls and any
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substance the storage, manufacture, disposal, treatment, generation,
use, transport, remediation or release of which into the environment
is prohibited, controlled or licensed under Environmental Laws;
(t) "INVENTORIES" means all inventories of every kind and nature and
wheresoever situate owned by Mineral Ridge and in any way pertaining
to the Business, including, without limitation, all inventories of
processed ore, raw materials, work-in-progress, finished goods, spare
parts, operating supplies and packaging materials of or in any way
pertaining to the Business;
(u) "LANDS" means the surface interest in lands and premises associated
with the Mineral Rights and all plant, improvements, appurtenances and
fixtures situated thereon or forming part thereof, including without
limitation, all buildings situated thereon and all reserves of
minerals IN SITU within, under or upon such lands and premises;
(v) "LAWS" means all applicable laws (including the common law), by-laws,
rules, rulings, regulations, orders, ordinances, notices, injunctions,
directions, decrees, treaties, statutes and judgments or other
requirements of any Governmental Authority, all as in force at the
date of this Agreement;
(w) "LIABILITIES" means any and all debts, liabilities, obligations,
claims or demands of whatsoever nature or kind and whether accrued,
contingent, absolute, conditional or otherwise and whether or not
determined or determinable;
(x) "MATERIAL CONTRACT" means any agreement, whether written or oral,
which is material to the Business and for the purposes of this
Agreement, a contract shall be a Material Contract if:
(i) performance of any right or obligation by any party to such
contract (other than a contract with a customer in the ordinary
course of business) may occur over a period of time greater
than one year;
(ii) an expenditure, receipt or transfer or other disposition of
property with a value of greater than $10,000 may arise under
such contract; or
(iii) such contract has been entered into other than in the ordinary
course of business;
(y) "MINERAL RIDGE" means Mineral Ridge Resources Inc., a company
incorporated under the laws of the State of Nevada;
(z) "MINERAL RIGHTS" means all water, water ▇▇▇▇▇, water rights,
concessions, leases, mineral interests, easements, reserves or any
other mineral interests, including, without limitation, patented and
unpatented claims and options to lease held by Mineral Ridge;
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(aa) "MISREPRESENTATION" means:
(i) an untrue statement of a material fact; or
(ii) an omission to state a material fact that is required to be
stated, or necessary to prevent a statement that is made from
being false or misleading in the circumstances in which it was
made;
(bb) "PERMITTED ENCUMBRANCES" means (i) Encumbrances for taxes, assessments
or governmental charges or levies on property not yet due or
delinquent, (ii) easements, encroachments and other minor
imperfections of title which do not, individually or in the aggregate,
materially detract from the value or impair the use or marketability
of the Mineral Rights or any real property, (iii) Encumbrances granted
by VGC or the Purchaser, and (iv) Encumbrances described in
Schedule "L" hereto;
(cc) "PERSON" means an individual, sole proprietorship, partnership,
unincorporated association, unincorporated syndicate, unincorporated
organization, trust, body corporate, a trustee, executor,
administrator or other legal representative, and any Governmental
Authority;
(dd) "PURCHASED SHARES" means the 25,000 issued and outstanding common
shares in the capital of Mineral Ridge being sold by the Vendor and
purchased by the Purchaser under this Agreement;
(ee) "SECURITIES LAWS" means the applicable securities laws of the Province
of British Columbia and the respective regulations made and forms
prescribed thereunder, together with all applicable published policy
statements and blanket orders and rulings of the British Columbia
Securities Commission;
(ff) "STOCK EXCHANGES" means The Toronto Stock Exchange and the American
Stock Exchange;
(gg) "TAXES" include, without limitation, all taxes, duties, fees,
premiums, assessments, imposts, levies and other charges of any kind
whatsoever imposed by any Governmental Authority, together with all
interest, penalties, fines, additions or taxes or other additional
amounts imposed in respect thereof (including, without limitation,
those levied on, or measured by, or referred to as income, gross
receipts, profits, capital, transfer, land transfer, sales, goods and
services, use, value-added, excise, stamp, withholding, business,
franchising, property, payroll, employment, health, social service,
education and social security taxes, all surtaxes, all customs duties
and import and export taxes, all licence, franchise and registration
fees, and all unemployment insurance, health insurance and Canada and
other government pension plan premium);
(hh) "U.S. EXCHANGE ACT" means the SECURITIES EXCHANGE ACT OF 1934, as
amended, of the United States of America;
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(ii) "U.S. PERSON" means a U.S. person as that term is defined in
Regulation S under the U.S. Securities Act;
(jj) "U.S. SECURITIES ACT" means the SECURITIES ACT OF 1933, as amended, of
the United States of America;
(kk) "U.S. SECURITIES LAWS" means the U.S. Securities Act, the U.S.
Exchange Act, the securities laws of each applicable state of the
United States and the regulations promulgated under each such act or
law;
(ll) "VGC SHARES" means the 1,562,500 common shares in the capital of VGC
to be issued to CRL at the Closing as consideration for the Purchased
Shares; and
(mm) "VGC SUBSCRIPTION AGREEMENT" means the agreement substantially in the
form of Schedule "N" hereto.
1.2 INTERPRETATION
For the purposes of this Agreement, except as otherwise expressly
provided:
(a) "THIS AGREEMENT" means this Agreement, including the recitals hereto,
and not any particular Part, Section, Subsection or other subdivision
or recital hereof, and includes any agreement, document or instrument
entered into, made or delivered pursuant to the terms hereof, as the
same may, from time to time, be supplemented or amended and in effect;
(b) the words "HEREOF", "HEREIN", "HERETO" and "HEREUNDER" and other words
of similar import refer to this Agreement as a whole and not to any
particular Part, Section, Subsection, or other subdivision or recital
hereof;
(c) the division of this Agreement into Parts, Sections, Subsections, and
other subdivisions or recitals, and the insertion of headings are for
convenience of reference only and are not intended to interpret,
define or limit the scope, extent or intent of this Agreement or any
provision hereof;
(d) all references to currency in this Agreement are to lawful money of
the United States of America and all amounts to be calculated or paid
pursuant to this Agreement are to be calculated in lawful money of the
United States of America;
(e) a reference to a statute in this Agreement includes all regulations or
rules made thereunder, all amendments to the statute, regulations or
rules in force as at the date of this Agreement, and any statutes,
regulations or rules that supplement or supersede such statutes,
regulations or rules;
(f) the singular of any term includes the plural, and vice versa, and the
use of any term is generally applicable to any gender and, where
applicable, a body corporate, firm or other entity, and the word "OR"
is not exclusive and the word "INCLUDING" is not limiting, whether or
not non-limiting language (such as
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"WITHOUT LIMITATION" or "BUT NOT LIMITED TO" or words of similar
import) is used with reference thereto;
(g) in the event that any date on which any action is required to be taken
hereunder by any of the parties hereto is not a Business Day, such
action shall be required to be taken on the next succeeding day which
is a Business Day; and
(h) all references to "APPROVAL", "AUTHORIZATION" or "CONSENT" in this
Agreement means written approval, authorization or consent.
PART 2
PURCHASE AND SALE
2.1 PURCHASE AND SALE OF PURCHASED SHARES
Subject to the terms and conditions contained in this Agreement,
the Vendor hereby agrees to sell, assign and transfer to the Purchaser and
the Purchaser hereby agrees to purchase from the Vendor at the Closing all of
the Purchased Shares, free and clear of all Encumbrances, except any
Permitted Encumbrances for a purchase price of $250,000 (CDN$380,700) payable
by the issuance of the VGC Shares to CRL at the Closing.
PART 3
REPRESENTATIONS AND WARRANTIES
3.1 REPRESENTATIONS AND WARRANTIES OF THE VENDOR AND CRL
The Vendor and CRL each represent and warrant to and in favour of
the Purchaser and VGC as follows, and acknowledge that, notwithstanding any
due diligence and investigations the Purchaser and VGC may have undertaken
prior to the Closing, the Purchaser and VGC are relying fully upon such
representations and warranties as an inducement to enter into this Agreement
and to consummate the transactions contemplated hereby:
(1) CORPORATE STATUS AND AUTHORITY
(a) CORPORATE STATUS OF THE VENDOR. The Vendor is duly incorporated and
validly exists under the laws of the State of Nevada and is in good
standing under applicable corporate statutes of the State of Nevada.
(b) CORPORATE STATUS OF THE CRL. CRL is duly incorporated and validly
exists under the laws of the Province of British Columbia and is in
good standing under the COMPANY ACT (British Columbia) .
(c) CORPORATE STATUS OF MINERAL RIDGE. Mineral Ridge is duly incorporated
and validly exists under the laws of the State of Nevada and is in
good standing under applicable corporate statutes of the State of
Nevada.
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(d) CORPORATE POWER AND AUTHORITY OF THE VENDOR TO ENTER INTO AND PERFORM
AGREEMENT. The Vendor has the corporate power and authority to own
and hold the Purchased Shares, to enter into this Agreement, to
consummate all transactions contemplated herein, to perform its
obligations hereunder, and to transfer legal title to and to transfer
beneficial ownership of the Purchased Shares to the Purchaser on the
terms and conditions hereof, free and clear of Encumbrances, except
Permitted Encumbrances.
(e) CORPORATE POWER AND AUTHORITY OF CRL TO ENTER INTO AND PERFORM
AGREEMENT. CRL has the corporate power and authority to enter into
this Agreement, to consummate all transactions contemplated herein and
to perform its obligations hereunder.
(f) NO BANKRUPTCY PROCEEDINGS. No proceedings have been taken or
authorized by the Vendor, CRL or Mineral Ridge or, to the best of the
knowledge of the Vendor or CRL, by any other person, with respect to
the bankruptcy, insolvency, liquidation, dissolution, or winding-up of
the Vendor, CRL or Mineral Ridge.
(g) POWER AND AUTHORITY OF MINERAL RIDGE. Mineral Ridge has all requisite
power and authority to own and lease its Assets and carry on its
Business.
(h) SUBSIDIARIES. Mineral Ridge has no subsidiaries or investments in
other corporate entities.
(i) CORPORATE RECORDS. The corporate records of the Vendor and Mineral
Ridge, as required to be maintained by the Vendor and Mineral Ridge
under the applicable corporate statutes of the State of Nevada,
including, without limitation, the Constating Documents of the Vendor
and Mineral Ridge, are accurate, complete and up-to-date in all
material respects and all material transactions of Mineral Ridge have
been promptly and properly recorded in its books or filed with its
records.
(2) NO DEFAULT
The execution and delivery of this Agreement, the consummation of
the transactions contemplated hereby, or the fulfilment of or compliance with
the terms and provisions hereof do not and will not, and do not create a
state of facts which after notice or lapse of time or both will:
(a) result in the breach of or violate any term or provision of the
Constating Documents of either Mineral Ridge or the Vendor;
(b) conflict with, result in the breach of, constitute a default under, or
accelerate or permit the acceleration of the obligations of the Vendor
or CRL under, any Material Contract, except the guarantee dated
January 17, 1997 between the Vendor and Dresdner, the pledge agreement
dated January 17, 1997 between the Vendor and Dresdner, the guarantee
dated January 17, 1997 between CRL and
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Dresdner and the pledge agreement dated January 17, 1997 between CRL
and Dresdner;
(c) result in the cancellation, suspension or alteration in the terms of
any Government Authorization;
(d) result in the creation of any Encumbrance upon any of the Assets;
(e) require the consent of any person pursuant to any Material Contract,
except Dresdner;
(f) give any person other than the parties hereto any material interest or
right, including, without limitation, rights of purchase, termination,
cancellation or acceleration under any Material Contract or Government
Authorization;
(g) subject to compliance with disclosure requirements under applicable
securities legislation and the rules, by-laws and policies of any
stock exchange having jurisdiction, conflict with, breach, or violate
any of the terms, conditions or provisions of any Law, or any
judgment, order, injunction, decree, regulation or ruling of any court
or stock exchange having jurisdiction; or
(h) result in the imposition of any Taxes on Mineral Ridge or the Assets.
(3) SHARE CAPITAL
(a) SHARE CAPITAL. The authorized share capital of Mineral Ridge consists
of 25,000 common shares with a par value of $1.00 per share, of which
25,000 common shares have been duly and validly allotted and issued
and are outstanding as fully-paid and non-assessable shares as at the
date hereof. No other shares in the capital of Mineral Ridge are
issued and outstanding as at the date hereof.
(b) SHAREHOLDERS. The Vendor is the sole legal and beneficial shareholder
of Mineral Ridge.
(c) NO OPTIONS. Except pursuant to this Agreement, no person has any
option, warrant, right, call, commitment, conversion right, right of
exchange or other agreement, present or future, contingent or
absolute, or any right or privilege (whether by law, pre-emptive or
contractual) capable of becoming an option, warrant, right, call,
commitment, conversion right, right of exchange or other agreement for
the purchase, subscription, allotment or issuance of any of the
unissued common shares, financial instruments convertible into common
shares or other securities of Mineral Ridge.
(4) FINANCIAL MATTERS
(a) FINANCIAL STATEMENTS. The Financial Statements have been prepared in
accordance with generally accepted accounting principles in Canada and
present fairly and accurately in every material respect the assets,
liabilities (whether
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accrued, absolute, contingent or otherwise) and financial condition
of Mineral Ridge as of the date of such statements, and the results
of the operations of Mineral Ridge during the periods covered by
such statements.
(b) LIABILITIES. Except as disclosed in the Financial Statements, Mineral
Ridge had no material Liabilities as of the date of the Financial
Statements, other than:
(i) certain of the amounts claimed by ▇.▇. ▇▇▇▇▇▇▇▇ & Sons and
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Company under a lien filed in the office of
the County Recorder of ▇▇▇▇▇▇▇▇▇ County, Nevada and disclosed
in Schedule "I" hereto;
(ii) certain additional interest and fees claimed by Dresdner under
the terms of the Dresdner Loan Agreement; and
(iii) certain additional funds requested by Van American Insurance
Company in respect of the reclamation obligations of Mineral
Ridge.
(5) INVENTORY
Gold inventory is recorded at estimated net realizable value. Gold
ounces contained and recoverable in the ▇▇▇▇▇ pad, or stockpile and in the
processing plant are valued using the average cost method and carried at the
lower of cost and net realizable value. All other Inventories are
merchantable or usable in the ordinary course of business. No items included
in the Inventories are held by Mineral Ridge on consignment from others or
have been pledged as collateral.
(6) MATERIAL CHANGES
Except as contemplated by this Agreement or disclosed in Schedule
"E", Mineral Ridge has not, since the date of the Financial Statements:
(a) experienced any adverse material change in the business, operations,
assets, liabilities, ownership, capital or financial position or
condition of Mineral Ridge, or any change in a material fact that has
a significant adverse effect on, or would reasonably be expected to
have a significant adverse effect on, the business, operations,
assets, liabilities, ownership, capital or financial position or
condition of Mineral Ridge, including, without limitation, the
Business, the Assets and the Liabilities;
(b) transferred, assigned, sold or otherwise disposed of any part of the
Business or any of the Assets, except in the normal course of
business;
(c) incurred or assumed any material Liability, except unsecured current
obligations and liabilities incurred in the ordinary and usual course
of business;
(d) discharged or satisfied any Encumbrance, or paid any obligation or
Liability, other than Liabilities disclosed in the Financial
Statements and the Liabilities incurred
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since the date of the Financial Statements that have been paid in
the normal course of business;
(e) suffered an extraordinary loss (before interest or taxes), waived,
surrendered or omitted to take any action in respect of any rights of
substantial value or entered into any commitment or transaction not in
the normal course of business, where such loss, rights, commitment or
transaction is or would be material in relation to the Assets or the
Business;
(f) granted any bonuses, whether monetary or otherwise, or made any
general wage or salary increases in respect of employees or officers
employed by Mineral Ridge other than as provided for in existing
employment arrangements, or changed the terms of employment for any
employee or officer of Mineral Ridge;
(g) hired or dismissed any employee or officer of Mineral Ridge, other
than the dismissals of ▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇▇;
(h) granted any Encumbrance in respect of any of the Assets;
(i) declared or paid any dividend or declared or made any other
distribution on any of the Purchased Shares or redeemed, purchased or
otherwise acquired any of the Purchased Shares; or
(j) authorized, agreed or otherwise become committed to do any of the
foregoing.
(7) BANKING
(a) LOANS AND CREDIT FACILITIES. Except as disclosed in Schedule "B"
hereto, Mineral Ridge has not entered into, committed to or otherwise
arranged for, any loans, operating lines of credit or other credit
facilities (including, without limitation, letters of credit, interest
rate or currency swaps, hedging contracts, forward loan or rate
agreements or other financial instruments), nor does Mineral Ridge
have any outstanding any bonds, debentures, mortgages, notes or other
similar indebtedness, and nor is Mineral Ridge obligated to create or
issue any bonds, debentures, mortgages, notes or other similar
indebtedness or financial instruments.
(b) GUARANTEES/INDEMNITIES. Mineral Ridge has not directly or indirectly
guaranteed or indemnified, or agreed to guarantee or indemnify, or
agreed to any other like commitment, in respect of any debt, liability
or other obligation of any person.
(c) BANK FACILITIES. Schedule "C" hereto contains a complete and accurate
listing showing the name of each bank, trust company or similar
financial institution in which Mineral Ridge has an account, safety
deposit box or other banking facility (of the nature described in
Schedule "C" hereto), including the names of all persons authorized to
transact business in respect of such accounts, and each corporate
credit card issued to Mineral Ridge.
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(8) MATERIAL CONTRACTS
Schedule "D" hereto contains a complete and accurate list of all
Material Contracts. Except as disclosed in Schedule "E" hereto, Mineral Ridge
is not in breach or default of any of the terms of any Material Contract, and
the Vendor is not aware of any breach or default of any of the terms of any
Material Contract by any party thereto other than Mineral Ridge, and each such
Material Contract is in good standing and in full force and effect without
amendment thereto. No state of facts exists which, after notice or lapse of
time or both, would constitute such a default or breach. Mineral Ridge has the
capacity, including the necessary personnel, equipment and supplies, to perform
all of its obligations under each of its Material Contracts.
(9) ASSETS AND PROPERTY
(a) OWNERSHIP OF ASSETS. Mineral Ridge owns good and marketable title to,
and is in actual and exclusive possession and control of, the Assets,
free and clear of Encumbrances, except Permitted Encumbrances, and
without limiting the generality of the foregoing, Mineral Ridge owns
or leases and is in actual and exclusive possession and control of the
Mineral Rights described in Schedule "F" hereto free and clear of
Encumbrances, except Permitted Encumbrances and, in the case of leased
Mineral Rights, the same are held under valid and subsisting leases,
and all monies due and payable thereunder have been duly paid;
(b) ZONING. All Lands are zoned to permit the particular activity carried
out on such Lands by Mineral Ridge and its authorized agents or any
person to whom Mineral Ridge has given occupancy rights in respect of
such Lands.
(c) ROYALTY PAYMENTS. Except as disclosed in Schedule "G" hereto, there
are no landowner's royalties, overriding royalties, net profits
interests, working interests or similar interests on or in relation to
any of the Assets.
(d) OPERATING CONDITIONS. Mineral Ridge has operated the Assets and the
Business in accordance with accepted industry standards and in
accordance with all applicable laws, regulations and orders. The
Equipment comprised in the Assets is in good operating condition.
(e) LIST OF MINERAL RIGHTS. There are no Mineral Rights comprised in the
Assets other than those described in the list of Mineral Rights set
out in Schedule "F" hereto, which accurately and completely describes
all interests of Mineral Ridge in any Mineral Rights.
(f) LIST OF LANDS. There are no Lands comprised in the Assets other than
those described in the list of Lands set out in Schedule "F" hereto,
which accurately and completely describes all interests in real
property owned by Mineral Ridge used in the conduct of the Business.
(g) LIST OF EQUIPMENT. There is no Equipment comprised in the Assets
other than as described in the list of Equipment set out in
Schedule "H" hereto, which accurately
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and completely describes the Equipment and other personal property
owned by Mineral Ridge.
(10) HAZARDOUS MATERIALS AND ENVIRONMENTAL LAWS
(a) HAZARDOUS MATERIALS AND COMPLIANCE WITH ENVIRONMENTAL LAWS. No
Hazardous Materials, or other material used in or generated by any of
the Assets or the Business, have been or are currently placed, used,
stored, treated, manufactured, disposed of, released, discharged,
spilled or emitted in violation of any Environmental Laws or
Governmental Authorizations. All Hazardous Materials disposed of,
removed, emitted, treated, released, discharged or spilled from or by
any of the Assets or the Business were and are documented, generated,
handled, transported, stored, treated and disposed of in compliance
with all Environmental Laws and Governmental Authorizations.
(b) WASTE DISPOSAL. All of the Assets that were or are used for the
generation, handling, treatment, storage or disposal of Hazardous
Materials or other material used in or generated by the Assets or the
Business on any of the Lands or on any of the Mineral Rights have been
and are properly permitted and operated in compliance with all
Environmental Laws.
(c) ENVIRONMENTAL CONTAMINATION. There is no Environmental Contamination
of any of the Assets or the Business.
(d) ENVIRONMENTAL ORDERS OR AGREEMENTS. There are no orders, agreements
or consent orders to which Mineral Ridge or any affiliate of Mineral
Ridge is a party relating to compliance of any of the Assets or the
Business with Environmental Laws.
(e) ENVIRONMENTAL CLAIMS. There have been no orders issued or threatened
and no investigations, removal, remedial or response actions ordered,
conducted, taken or threatened under or pursuant to any Environmental
Laws with respect to the Assets or the Business or any other
businesses conducted on or from any of the Lands or Mineral Rights
other than routine inspections. No claims are pending or threatened
with respect to Environmental Contamination on any of the Lands or
Mineral Rights or the violation of any Environmental Laws in
connection with the Assets or the Business.
(f) NUISANCE. The use of, and operations relating to, the Assets and the
Business conducted on or from the Lands or Mineral Rights, do not
constitute a nuisance of any nature, nor has any such claim for
nuisance been made or threatened in respect of such use by any person.
(11) LEGAL AND REGULATORY MATTERS
(a) LITIGATION. Except as described in Schedule "I" hereto, there are no
actions, suits, litigations, arbitrations, proceedings or claims in
progress, pending or threatened against or relating to Mineral Ridge,
the Vendor or CRL or likely to affect any of the Business, the Assets
or the Purchased Shares, there is no circumstance, matter or
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thing known to the Vendor or CRL which might reasonably give rise to
any such proceeding and there is not outstanding or threatened against
Mineral Ridge, the Vendor or CRL any judgment, decree, injunction,
rule or order of or by any court or Governmental Authority having
jurisdiction.
(b) COMPLIANCE WITH LAWS. The operation of the Business is conducted in
compliance with all applicable Laws of each jurisdiction in which the
Business has been and is carried out and none of Mineral Ridge, the
Vendor or CRL have received any notice of any alleged material breach
or violation of any such Laws.
(c) COMPLIANCE DIRECTIVES. There are no outstanding compliance directives
or work orders relating to Mineral Ridge, the Assets or the Business
from any police, fire department, sanitation, health authorities,
environmental agencies, or from any other Government Authority,
department or agency, nor does Mineral Ridge, the Vendor or CRL have
notice that there are any matters under consideration by such
authorities relating to Mineral Ridge, the Assets or the Purchased
Shares.
(d) NOTICE OF DEFAULT/CLAIMS. None of Mineral Ridge, the Vendor or CRL
has received, from any Governmental Authority or a third party, any
notice of violation of any law or regulation or of any default,
violation or termination of any permits and licenses or of any fact or
circumstance which shall, or is likely to, result in such a default,
violation or termination.
(e) NO SEIZURE. Except in respect of the litigation described in
Schedule "I" hereto, there is no eminent domain, appropriation,
expropriation or seizure proceeding in respect of the Assets, the
Business or the Purchased Shares that is pending or that has been
threatened.
(f) LICENSES, REGISTRATIONS AND PERMITS. Mineral Ridge is duly qualified
to carry on, and holds all licenses, registrations and permits as may
be required for carrying on, the Business in all jurisdictions in
which the nature of the Business or the Assets make such
qualification, licenses, registrations and permits necessary.
(g) RECLAMATION. The Financial Statements and notes thereto accurately
disclose and describe all obligations of Mineral Ridge under all
applicable statutes for reclamation, site restoration and closure
requirements in respect of its Assets.
(12) TAXATION
There are no actions, suits, claims, proceedings, investigations or
audits now pending or threatened against Mineral Ridge, the Vendor or CRL in
respect of any Taxes affecting the Assets, the Business or the Purchased Shares
and there are no matters under discussion, audit or appeal with any Governmental
Authority relating to Taxes which, if not paid, would result in a lien or charge
on any of the Assets or the Purchased Shares. Mineral Ridge has fulfilled all
requirements under Laws for withholding of amounts from employees and has
remitted all amounts withheld to the appropriate authorities within the
prescribed times.
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(13) EMPLOYMENT MATTERS
(a) EMPLOYEE CONTRACTS. Except as disclosed in Schedule "J" hereto,
Mineral Ridge is not a party to:
(i) any material written contract or commitment for the employment of
any officer or employee;
(ii) any agreement relating to the termination or notice of
termination of any employee which requires a specified notice
period or salary in lieu of notice;
(iii) any contract with or commitment to any labour union or
employees' association;
(iv) any pension, profit sharing, deferred compensation, retirement,
hospitalization, health, disability, termination, insurance or
similar plan or practice, formal or informal, with respect to its
employees, former employees or others, other than a stock option
plan or a group benefits plan; and
(v) any other contract that requires more than six months' notice of
termination.
(b) UNIONS. There are no current attempts to organize or establish any
labour union or employee association with respect to Mineral Ridge.
(c) NO GOLDEN PARACHUTES. Except in respect of the employment contracts
described in Schedule "J" hereto, neither the execution and delivery
of this Agreement nor the consummation of any of the transactions
contemplated hereby or thereby, whether individually or in the
aggregate, shall:
(i) result in any payment (including, without limitation, a
severance, unemployment compensation, termination, "golden
parachute", bonus or other payment) becoming due to any director,
officer, employee, agent or contractor of Mineral Ridge or of any
other person including CRL for which Mineral Ridge would be
liable in whole or in part under any plan, agreement or
otherwise; or
(ii) materially increase or result in the acceleration of the time of
payment of any salary or benefits otherwise payable by Mineral
Ridge to any director, officer, employee, agent or contractor of
Mineral Ridge or of any other person including CRL for which
Mineral Ridge would be liable in whole or in part.
(d) NO EMPLOYMENT DISPUTES. Mineral Ridge has not terminated the
employment of any employee in circumstances that may give rise to a
claim by such employee for wrongful dismissal, other than the claim of
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ described in Schedule "I" hereto. No notice has been
received by Mineral Ridge or CRL of any complaint filed by any of its
employees against it, claiming that it has violated any
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applicable employment standards or human rights or similar
legislation or of any applications, complaints or proceedings of
any kind involving Mineral Ridge or any of its employees before any
court, labour relations board or similar tribunal. There are no
pending or threatened work stoppages or labour disputes, charges or
unfair labour practices by any present or former employees of
Mineral Ridge. No event has occurred with respect to CRL, the
Vendor or Mineral Ridge which is likely to result in any claim or
action against Mineral Ridge under any Laws related to employment
or social security matters or any increase in social insurance
payroll assessments or any similar assessment payable by Mineral
Ridge.
(e) RETIREMENT AND BENEFITS PLANS. The Financial Statements and notes
thereto accurately disclose and describe all retirement and benefits
plans and pension obligations for present and past employees of
Mineral Ridge.
(14) INSURANCE
Mineral Ridge maintains such policies of insurance and insured
reclamation bonds, issued by responsible insurers, as are appropriate to or
statutorily required for the Business and its Assets, in such amounts and
against such risks as are customarily carried and insured against by owners of
comparable businesses, properties and assets. Except as disclosed in Schedule
"I" with respect to the reclamation bonding with Van American, all such policies
of insurance and insured reclamation bonds, are in full force and effect and
Mineral Ridge is not in default as to the payment of premiums or other terms of
any such policy. Schedule "K" hereto contains a complete list of all such
insurance policies and insured reclamation bonds carried by Mineral Ridge.
(15) BINDING AGREEMENT
This Agreement has been duly executed and delivered by the Vendor and
CRL and constitutes a legal, valid and binding obligation of the Vendor and CRL.
(16) OWNERSHIP OF PURCHASED SHARES
(a) The Vendor is the sole legal and beneficial owner of the Purchased
Shares, free and clear of all Encumbrances, except Permitted
Encumbrances.
(b) The Vendor is not acting as nominee, agent, trustee, executor,
administrator or other legal representative on behalf of any other
person who has a direct beneficial interest in the Purchased Shares.
(17) RESIDENCY
Mineral Ridge is a "non-resident" of Canada within the meaning of the
INCOME TAX ACT (Canada).
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(18) NO COMMISSION
Neither the Vendor nor CRL has taken any action that would result in a
brokerage commission, finder's fee or other like payment being payable by any
party hereto with respect to the transactions contemplated hereby.
(19) APPROVALS
Except as disclosed in Schedule "M" hereto or as otherwise specified
in this Agreement or the VGC Subscription Agreement, no exemption, consent,
approval, order or authorization of any court, Governmental Authority, stock
exchange or any third party is required by, or with respect to, the Vendor, CRL
or Mineral Ridge in connection with the execution, delivery and performance of
this Agreement by the Vendor or CRL or the consummation by the Vendor or CRL of
any of the transactions contemplated hereby.
(20) REPRESENTATIONS AND WARRANTIES OF MINERAL RIDGE IN RESTATED AND
AMENDED LOAN AGREEMENT
The representations and warranties of Mineral Ridge set out in Article
VI of the restated and amended loan agreement between Mineral Ridge and Dresdner
dated as of October 21, 1998, other than:
(a) the representations and warranties set out in Sections 6.5 and 6.7;
and
(b) the representations set out in Sections 6.6 and 6.18, insofar as they
pertain to the Purchaser or VGC,
are, and will on the Closing Date, be true, complete and accurate.
(21) SECURITIES LAWS
(a) PURCHASE AS PRINCIPAL. CRL is purchasing the VGC Shares as
principal for its own account, and not for the benefit of any
other person, for investment only and not with a view to resale
or distribution.
(b) NO ADVERTISEMENT. The offering and sale of the VGC Shares to CRL
were not made through an advertisement of the VGC Shares in
printed media of general and regular paid circulation, radio or
television or any other form of advertisement, and, to its
knowledge, CRL has not received an offering memorandum as such
term is defined under the Securities Laws, and CRL acknowledges
that it is not purchasing the VGC Shares as a result of any form
of general solicitation or general advertising including
advertisements, articles, notices or other communications
published in any newspaper, magazine or similar media or
broadcast over radio, or television, or any seminar or meeting
whose attendees have been invited by general solicitation or
general advertising.
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(c) NO INSIDER INFORMATION. The VGC Shares are not being purchased
by CRL as a result of any material information concerning the
Company that has not been publicly disclosed and CRL's decision
to enter into this agreement and acquire the VGC Shares has not
been made as a result of any verbal or written representation as
to fact or otherwise made by or on behalf of the Company or any
other person and is based entirely upon currently available
public information concerning the Company.
(d) FINANCIAL KNOWLEDGE. CRL has such knowledge and experience in
financial and business affairs as to be capable of evaluating the
merits and risks of the investment hereunder in the VGC Shares
and is able to bear the economic risk of loss of such investment.
(e) "U.S. PERSON". CRL is not a "U.S. Person" as defined in
Regulation S under the U.S. Securities Act.
(f) INVESTMENT ONLY. CRL has no intention to distribute either
directly or indirectly any of the VGC Shares in the United States
or to "U.S. Persons"; provided, however, that CRL may sell or
otherwise dispose of any of the VGC Shares pursuant to
registration thereof pursuant to the U.S. Securities Act and any
applicable state securities laws or under an exemption from such
registration requirements.
(g) NO U.S. REGISTRATION. CRL understands that the VGC Shares have
not been and will not be registered under the U.S. Securities Act
and that the sale contemplated hereby is being made in reliance
on an exemption from such registration requirement.
(h) ACCREDITED INVESTOR. CRL is an Accredited Investor and is a
corporation not formed for the specific purpose of acquiring the
VGC Shares, with total assets in excess of $5,000,000.
(i) NO "DIRECTED SELLING EFFORTS". CRL acknowledges that it has not
purchased the VGC Shares as a result of, and will not itself
engage in, any "directed selling efforts" (as defined in
Regulation S under the U.S. Securities Act) in the United States
in respect of the VGC Shares which would include any activities
undertaken for the purpose of, or that could reasonably be
expected to have the effect of, conditioning the market in the
United States for the resale of the VGC Shares; provided,
however, that CRL may sell or otherwise dispose of any of the VGC
Shares pursuant to registration of the VGC Shares pursuant to the
U.S. Securities Act and any applicable state securities laws or
under an exemption from such registration requirements and as
otherwise provided herein.
(j) ADDRESS OF CRL. The office of CRL at which CRL received and
accepted the offer to purchase the VGC Shares is the address
listed on the first page of this Agreement.
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(k) U.S. RESALE RESTRICTIONS. CRL agrees that if it decides to
offer, sell or otherwise transfer any of the VGC Shares, it will
not offer, sell or otherwise transfer any of such VGC Shares
directly or indirectly, unless:
(i) the sale is to VGC;
(ii) the sale is made outside the United States in a transaction
meeting the requirements of Rule 904 of Regulation S under
the U.S. Securities Act and in compliance with applicable
local laws and regulations;
(iii) the sale is made pursuant to the exemption from the
registration requirements under the U.S. Securities Act
provided by Rule 144 thereunder and in accordance with any
applicable state securities or "Blue Sky" laws; or
(iv) the VGC Shares are sold in a transaction that does not
require registration under the U.S. Securities Act or any
applicable U.S. state laws and regulations governing the
offer and sale of securities, and it has prior to such sale
furnished to VGC an opinion reasonably satisfactory to VGC.
(l) CANADIAN RESALE RESTRICTIONS. CRL acknowledges that if it
decides to offer, sell or otherwise transfer any of the VGC
Shares in Canada, such securities may be offered or sold or
otherwise transferred only:
(i) pursuant to an exemption from the registration and
prospectus requirements under the Securities Laws or the
securities legislation of the province of Canada in which
such trade is occurring, and with the prior consent of The
Toronto Stock Exchange; or
(ii) if 12 months has elapsed from the date of the issue of the
VGC Shares, and at that time CRL is not a control person of
VGC, no unusual effort is made to prepare the market or
create a demand for the VGC Shares and no extraordinary
commission or other consideration is paid in respect of such
offer, sale or transfer.
(m) LEGEND. CRL acknowledges that all certificates issued
representing the VGC Shares, as well as all certificates issued
in exchange for or in substitution therefor, will bear legends to
the following effect:
"THE COMMON SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
THE FOLLOWING HOLD PERIOD AND RESALE RESTRICTIONS:
1. B.C. LEGEND -- THE COMMON SHARES REPRESENTED BY THIS
CERTIFICATE ARE SUBJECT TO A HOLD PERIOD IN THE PROVINCE OF
BRITISH COLUMBIA AND MAY NOT
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BE TRADED IN BRITISH COLUMBIA UNTIL OCTOBER 21, 1999,
EXCEPT AS PERMITTED BY THE SECURITIES ACT (BRITISH
COLUMBIA) AND THE REGULATIONS AND RULES MADE THEREUNDER.
A NEW CERTIFICATE, NOT BEARING THIS LEGEND, MAY BE
OBTAINED FROM THE COMPANY UPON DELIVERY OF THIS
CERTIFICATE AT ANY TIME AFTER OCTOBER 21, 1999.
2. U.S. LEGEND -- THE COMMON SHARES REPRESENTED BY THIS
CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"). THE
HOLDER HEREOF, BY PURCHASING SUCH SECURITIES, AGREES FOR THE
BENEFIT OF THE COMPANY THAT SUCH SECURITIES MAY BE OFFERED,
SOLD OR OTHERWISE TRANSFERRED ONLY (A) TO THE COMPANY; (B)
OUTSIDE THE UNITED STATES IN ACCORDANCE WITH RULE 904 OF
REGULATION S UNDER THE 1933 ACT OR (C) WITHIN THE UNITED
STATES IN ACCORDANCE WITH THE EXEMPTION FROM REGISTRATION
UNDER THE 1933 ACT PROVIDED BY RULE 144 THEREUNDER, IF
APPLICABLE, AND IN COMPLIANCE WITH ANY APPLICABLE STATE
SECURITIES LAWS. DELIVERY OF THIS CERTIFICATE MAY NOT
CONSTITUTE GOOD DELIVERY IN SETTLEMENT OF TRANSACTIONS ON
STOCK EXCHANGES IN CANADA. A NEW CERTIFICATE, NOT BEARING
THIS LEGEND, MAY BE OBTAINED FROM THE COMPANY'S REGISTRAR
AND TRANSFER AGENT, UPON DELIVERY OF THIS CERTIFICATE AND
EITHER A DULY EXECUTED DECLARATION, IN A FORM SATISFACTORY
TO SUCH REGISTRAR AND TRANSFER AGENT AND THE COMPANY, TO THE
EFFECT THAT SUCH SALE IS BEING MADE IN ACCORDANCE WITH
RULE 904 OF REGULATION S UNDER THE 1933 ACT OR AN OPINION OF
COUNSEL SATISFACTORY TO THE COMPANY TO THE EFFECT THAT SUCH
SALE IS EXEMPT FROM REGISTRATION UNDER THE 1933 ACT."
(n) RECORD OF TRANSFER. CRL understands and acknowledges that the
Company, at its option, may not record a transfer without first
being satisfied that such transfer is exempt from or not subject
to registration under the U.S. Securities Act or the securities
laws of any state of the United States or is exempt from or not
subject to the registration and prospectus requirements under the
Securities Laws or the securities legislation of the province of
Canada in which such transfer is occurring.
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3.2 REPRESENTATIONS AND WARRANTIES OF THE PURCHASER AND VGC
The Purchaser and VGC represent and warrant to and in favour of the
Vendor and CRL as follows and acknowledge that the Vendor and CRL are relying
upon such representations and warranties as an inducement to enter into this
Agreement and to consummate the transactions contemplated hereby, that as at the
date hereof:
(1) CORPORATE STATUS AND AUTHORITY
(a) CORPORATE STATUS OF THE PURCHASER. The Purchaser is a company that is
duly incorporated and validly existing under the laws of the State of
Nevada and in good standing under applicable corporate statutes.
(b) CORPORATE STATUS OF VGC. VGC is a corporation that is duly continued
and validly existing under the laws of the Yukon Territory and in good
standing under the BUSINESS CORPORATIONS ACT (Yukon Territory).
(c) CORPORATE POWER AND AUTHORITY OF THE PURCHASER. The Purchaser has the
corporate power and authority to enter into this Agreement, to perform
its obligations hereunder and to acquire legal and beneficial title to
and ownership of the Purchased Shares from CRL on the terms and
conditions hereof.
(d) CORPORATE POWER AND AUTHORITY OF VGC. VGC has the corporate power and
authority to enter into this Agreement, and to perform its obligations
hereunder.
(e) NO BANKRUPTCY PROCEEDINGS. No proceedings have been taken or
authorized by the Purchaser or VGC or, to the best of the knowledge of
the Purchaser or VGC, by any other person, with respect to the
bankruptcy, insolvency, liquidation, dissolution, or winding-up of the
Purchaser or VGC.
(2) NO DEFAULT
The execution and delivery of this Agreement, the fulfilment of or
compliance with the terms and provisions hereof and the issue, sale and delivery
on the Closing Date of the VGC Shares, do not and will not result in a breach of
and do not create a state of facts which, after notice or lapse of time, or
both, will result in a breach of, and do not and will not conflict with, any of
the terms, conditions or provisions of the constating documents of the Purchaser
or VGC or any trust indenture, agreement or instrument to which the Purchaser or
VGC is a party or by which the Purchaser or VGC is contractually bound or will
be contractually bound on the Closing Date.
(3) BINDING AGREEMENT
This Agreement has been duly executed and delivered by the Purchaser
and VGC and constitutes a legal, valid and binding obligation of the Purchaser
and VGC.
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(4) SHARE CAPITAL
The authorized share capital of VGC consists of an unlimited number of
common shares without par value and an unlimited number of preferred shares, of
which 89,152,540 common shares are issued and outstanding on the date hereof as
fully paid and non-assessable shares.
(5) DISCLOSURE DOCUMENTS
The following disclosure documents of VGC:
(a) the audited annual financial statements for the year ended
December 31, 1997;
(b) the management information and proxy circular dated as of May 11, 1998
for VGC's 1998 annual general meeting;
(c) all press releases issued by VGC after December 31, 1997;
(d) the Form 20-F of VGC dated March 30, 1998; and
(e) the quarterly reports to shareholders on the interim financial periods
ended March 31, 1998 and June 30, 1998,
were, at their respective dates of issue or publication, true and
correct in all material respects, contained no misrepresentations and
were prepared in accordance with and complied with applicable laws,
regulations, policy statements and rules.
(6) NO ENCUMBRANCES ON VGC SHARES
At their time of issue, the VGC Shares will be free and clear of all
Encumbrances, other than those created by, or imposed upon, the holders thereof
through no action of VGC.
(7) LISTING OF VGC SHARES
The common shares in the capital of VGC are listed and posted for
trading on the Stock Exchanges.
(8) REPORTING ISSUER STATUS
VGC is a reporting issuer under the SECURITIES ACT (British Columbia),
and is in compliance with its obligations thereunder.
(9) NO COMMISSION
Neither the Purchaser nor VGC has taken any action that would result
in a brokerage commission, finder's fee or other like payment being payable by
any party hereto with respect to the transactions contemplated hereby.
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PART 4
COVENANTS
4.1 COVENANTS OF THE VENDOR AND CRL
(1) AGREEMENT DATE TO CLOSING
Each of the Vendor and CRL covenants and agrees with the Purchaser and
VGC that, from the date of this Agreement to the Closing, it shall, and shall
cause Mineral Ridge to:
(a) ACCESS. Allow the Purchaser, VGC and their representatives reasonable
access to the premises and the properties of the Vendor and Mineral
Ridge and to the files, books, records and offices of the Vendor and
Mineral Ridge, including, without limitation, any and all information
relating to the Vendor's and Mineral Ridge's tax matters, contracts,
leases, licences and real, personal and intangible property and
financial condition. The Vendor and Mineral Ridge shall cause the
Vendor's and Mineral Ridge's auditors to cooperate with the
Purchaser's auditors in making available to the Purchaser and VGC all
financial information reasonably requested, including, without
limitation, the right to examine the working papers pertaining to tax
matters and financial statements prepared or audited by the Vendor's
and Mineral Ridge's auditors;
(b) CONSULTATION. Permit the Purchaser's representatives to meet with the
Vendor's and Mineral Ridge's directors, officers and employees and
attend such business meetings and provide the Purchaser with such
periodic reports, as the Vendor may reasonably request to permit the
Vendor to become and remain informed as to the Vendor's and Mineral
Ridge's business, assets and operations;
(c) CONDUCT BUSINESS IN THE ORDINARY COURSE. Except as otherwise provided
in this Agreement, operate the Business in the usual, regular and
ordinary manner and, to the extent consistent with such operation,
keep available the services of Mineral Ridge's present directors,
officers and employees (subject to voluntary resignations and
dismissals in accordance with proper business practices) and preserve
its and Mineral Ridge's relationships with clients and others having
business dealings with Mineral Ridge;
(d) NO ENCUMBRANCES ON ASSETS. Refrain from creating or permitting any
Encumbrance, other than Permitted Encumbrances, on the Assets in whole
or in part and from selling, transferring or otherwise disposing of
the Assets;
(e) NO ENCUMBRANCES ON SHARES. Refrain from creating or permitting any
Encumbrance, other than Permitted Encumbrances, on the Purchased
Shares;
(f) NO DIVIDENDS. Refrain from declaring any dividends or making any
other distributions in respect of capital stock of Mineral Ridge;
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(g) NO CHANGE TO MATERIAL CONTRACTS. Refrain from amending or varying any
of the Material Contracts or enter into any other Material Contract;
(h) MAINTAIN INSURANCE. Maintain in full force and effect all of the
Vendor's, CRL's and Mineral Ridge's policies of insurance and insured
reclamation bonds or renewals of such policies or bonds now in effect
in respect of Mineral Ridge, the Assets, the Business, and Mineral
Ridge's directors, officers and employees, and shall give all notices
and present all claims under all existing policies in a due and timely
fashion as may be reasonably required in accordance with prudent
business practice;
(i) RESTRICTIONS ON LOANS. Ensure that Mineral Ridge does not incur any
borrowings;
(j) RESTRICTIONS ON CERTAIN COMMITMENTS. Ensure that Mineral Ridge does
not enter into commitments in the nature of a capital expenditure and
that Mineral Ridge does not incur any contingent liability;
(k) NO AMENDMENT TO CHARTER DOCUMENTS. Except as otherwise provided in
this Agreement, not amend Mineral Ridge's Constating Documents or
change in any manner Mineral Ridge's authorized capital or the rights,
privileges, restrictions and conditions attaching to any of Mineral
Ridge's share capital;
(l) NO APPOINTMENTS OF NEW DIRECTORS OR OFFICERS. Ensure that Mineral
Ridge does not appoint any new directors or officers;
(m) MAINTAIN REGISTRATIONS. Use its best efforts to maintain all of
Mineral Ridge's registrations, licenses and permits, and the
registrations, licences and permits of Mineral Ridge's directors,
officers and employees, in good standing with such Regulatory
Authorities as are necessary to permit Mineral Ridge and its
directors, officers and employees to carry on the Business as
presently carried on;
(n) COMPLIANCE WITH LAWS. Comply in all material respects with all laws
applicable to it and to the conduct of the Business;
(o) OBTAIN CONSENTS. Use its best efforts to obtain, and where required
for the operation of the Business, to transfer to Mineral Ridge, all
necessary Governmental Authorizations, and all necessary releases,
waivers, consents and approvals as may be required to complete the
Vendor's obligations under this Agreement and to consummate the
transactions contemplated by this Agreement, and all such releases,
waivers, consents and approvals shall be in form and substance
satisfactory to the Purchaser, acting reasonably;
(p) MAINTENANCE OF BOOKS AND RECORDS. Maintain Mineral Ridge's books of
account and records in the usual, regular and ordinary manner, in
accordance with generally accepted accounting principles applied on a
consistent basis;
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(q) NOTICE OF MATERIAL DEVELOPMENTS. Notify the Purchaser and VGC as soon
as any of its or Mineral Ridge's directors or officers have determined
that a state of facts exist which results in, or shall result in:
(i) any representation and warranty of the Vendor or CRL being untrue
or incorrect in any material respects;
(ii) the non-fulfilment of any conditions set forth in this Agreement;
or
(iii) any adverse material change in the business, operations,
assets, liabilities, ownership, capital or financial position or
condition of Mineral Ridge, or change in a material fact that has
a significant adverse affect on, or would reasonably be expected
to have a significant adverse affect on, the business,
operations, assets, liabilities, ownership, capital or financial
position or condition of Mineral Ridge; and
(r) PERMIT REPRESENTATIVE TO MANAGE BUSINESS AND OPERATIONS. Take such
reasonable steps as are necessary to allow a representative of the
Purchaser or VGC to manage the business and operations of Mineral
Ridge at the Mineral Ridge mine.
The Vendor and CRL acknowledge that the Purchaser and VGC are relying
upon the foregoing covenants and agreements as an inducement to enter into this
Agreement and to consummate the transactions contemplated by this Agreement.
(2) AT CLOSING
In addition to the foregoing, each of the Vendor and CRL covenants and
agrees with the Purchaser and VGC that it shall, and shall cause Mineral Ridge
to, ensure that immediately prior to the Closing:
(a) REPRESENTATIONS AND WARRANTIES. The representations and warranties of
the Vendor and CRL shall be true and correct in all material respects;
(b) EXECUTION AND DELIVERY RATIFIED AND AUTHORIZED. The execution and
delivery of this Agreement and the performance by each of the Vendor
and CRL of its respective obligations under this Agreement shall be
duly and validly ratified and authorized by the Board of Directors of
the Vendor and CRL, as the case may be; and
(c) DUE EXECUTION. This Agreement shall be duly executed and delivered by
the Vendor and CRL and constitute a valid and binding obligation of
the Vendor enforceable against the Vendor and CRL.
The Vendor and CRL acknowledge that the Purchaser and VGC are relying
upon the foregoing covenants and agreements as an inducement to enter into this
Agreement and to consummate the transactions contemplated by this Agreement.
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4.2 COVENANTS OF THE PURCHASER AND VGC
(1) GENERAL
Each of the Purchaser and VGC covenants and agrees with the Vendor and
CRL as follows:
(a) COMPLETION OF DUE DILIGENCE. The Purchaser and VGC shall use their
best efforts to complete their due diligence investigations on or
before October 12, 1998;
(b) CONSENT OF STOCK EXCHANGES. VGC will use its best efforts to obtain
the consent of the Stock Exchanges and comply with all other
regulatory requirements, requirements of the Stock Exchanges and
requirements of the Securities Laws and U.S. Securities Laws
applicable to the offering and sale of VGC Shares to CRL on a "private
placement" basis as contemplated by this Agreement prior to the
Closing Date; and
(c) LISTING OF VGC SHARES. VGC will use its best efforts to ensure that
the VGC Shares will be listed and posted for trading on the Stock
Exchanges.
The Purchaser and VGC acknowledge that the Vendor and CRL are relying
upon the foregoing covenants and agreements as an inducement to enter into this
Agreement and to consummate the transactions contemplated by this Agreement.
(2) AT CLOSING
In addition to the foregoing, each of the Purchaser and VGC covenants
and agrees with the Vendor and CRL that immediately prior to the Closing:
(a) REPRESENTATIONS AND WARRANTIES. The representations and warranties of
the Purchaser and VGC shall be true and correct in all material
respects;
(b) EXECUTION AND DELIVERY RATIFIED AND AUTHORIZED. The execution and
delivery of this Agreement and the performance by each of the
Purchaser and VGC of its respective obligations under this Agreement
shall be duly and validly ratified and authorized by the Board of
Directors of the Purchaser and VGC, as the case may be; and
(c) DUE EXECUTION. This Agreement shall be duly executed and delivered by
the Purchaser and VGC and constitute a valid and binding obligation of
the Purchaser and VGC, enforceable against the Purchaser and VGC.
The Purchaser and VGC acknowledge that the Vendor and CRL are relying
upon the foregoing covenants and agreements as an inducement to enter into this
Agreement and to consummate the transactions contemplated by this Agreement.
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PART 5
CONDITIONS PRECEDENT
5.1 Mutual Conditions Precedent
The obligations of the parties to complete the sale of the Purchased
Shares and the transactions contemplated by this Agreement are subject to the
following conditions being satisfied on or before the Closing, which conditions
are for the mutual benefit of all parties to this Agreement and may be waived in
whole or in part only if jointly waived by all of the parties to this Agreement:
(a) all material approvals, authorizations or consents, including
approvals by Governmental Authorities, regulatory authorities, third
parties and judicial approvals and orders legally required for the
consummation of the Agreement and the transactions contemplated by
this Agreement, shall have been obtained or received from the persons,
authorities or bodies having jurisdiction in the circumstances;
(b) none of the approvals, authorizations, consents, orders, laws or
regulations contemplated in this Section 5.1 shall have contained
terms or conditions or require undertakings or security deemed
unsatisfactory or unacceptable by any of the parties acting
reasonably;
(c) an agreement, or agreements, in form and substance acceptable to VGC,
shall have been entered into among Mineral Ridge, the Vendor, CRL and
Dresdner whereunder:
(i) the terms of the indebtedness of Mineral Ridge to Dresdner are
amended in a manner satisfactory to VGC;
(ii) Dresdner consents to the acquisition of Mineral Ridge by the
Purchaser; and
(iii) Dresdner agrees to release the Vendor and CRL of all
obligations and liabilities undertaken by the Vendor or CRL in
connection with the debt financing of Mineral Ridge and the
Business, including the pledge of the Vendor's issued and
outstanding shares by CRL and the pledge of the issued and
outstanding shares of Touchstone Resources Company and Mineral
Ridge by the Vendor,
and such other documents as may be required to give effect thereto;
(d) agreements shall have been entered into among Mineral Ridge, the
Vendor, CRL, the Purchaser, VGC and Dresdner and such other creditors
of Mineral Ridge, the Vendor or CRL as may be necessary to release
each of the Vendor and CRL of all its liabilities, whether as
principal debtor or guarantor, in respect of the development or
operation of Mineral Ridge and the Business, including
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agreements with a reclamation bonding company and such other
documents necessary to give effect thereto; and
(e) there shall be no inter-company balances owing between Mineral Ridge
and either of the Vendor or CRL, and Mineral Ridge, the Vendor and CRL
shall have executed and delivered such releases of such inter-company
balances as may be requested by the Purchaser and VGC.
5.2 CONDITIONS FOR THE BENEFIT OF THE VENDOR AND CRL
The obligation of the Vendor and CRL to complete the sale of the
Purchased Shares and the transactions contemplated by this Agreement is subject
to the satisfaction on or before the Closing, for the exclusive benefit of the
Vendor and CRL, of each of the following conditions:
(a) the representations and warranties of the Purchaser shall be true and
correct in all material respects as at the Closing with the same force
and effect as if such representations and warranties had been made at
and as of the Closing;
(b) the Purchaser and VGC shall have, in all material respects, performed
and complied with all covenants and agreements contained in this
Agreement to be performed or complied with, or caused to be performed
or complied with, by the Purchaser and VGC at or prior to the Closing;
(c) VGC shall have delivered to the Vendor and CRL:
(i) the VGC Subscription Agreement duly executed by VGC, together
with a cheque in the amount of $250,000 representing the purchase
price for the CRL Shares;
(ii) certified copies of resolutions of the directors of the Purchaser
and VGC approving this Agreement and all other transactions
contemplated by this Agreement; and
(iii) such other documentation and assurances as may be reasonably
required by the Vendor, or CRL, or their counsel;
(d) each of the Purchaser and VGC shall have delivered to the Vendor and
CRL a certificate, dated as of the Closing, and signed by any two of
its officers certifying that:
(i) the representations and warranties of the Purchaser and VGC
herein contained are true and correct at the Closing;
(ii) each of the Purchaser and VGC has performed and complied with all
covenants and agreements contained in this Agreement to be
performed or complied with by the Purchaser and VGC at or prior
to the Closing; and
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(iii) all necessary corporate action has been taken by the
Purchaser and VGC to authorize the execution and delivery of this
Agreement and to consummate the transactions contemplated by this
Agreement; and
(e) counsel to the Purchaser and VGC shall have delivered to the Vendor
and CRL favourable legal opinions, dated the Closing, in form and
content to the reasonable satisfaction of the Vendor and CRL and with
respect to all such matters as the Vendor and CRL may reasonably
request including, without limitation, the following:
(i) each of the Purchaser and VGC is duly organized and is a validly
existing company, is in good standing under applicable laws, and
is duly qualified to carry on business and own property under the
laws of any other jurisdictions in which it carries on business
or owns property;
(ii) this Agreement has been duly authorized by all necessary
corporate action on the part of the Purchaser and VGC, has been
duly executed and delivered by and on behalf of the Purchaser and
VGC, and is valid and legally binding upon the Purchaser and VGC;
(iii) all necessary steps, authorizations and approvals have been
taken or obtained by the Purchaser and VGC to authorize the
execution and delivery by the Purchaser and VGC of the Agreement
and the performance of their respective obligations thereunder;
(iv) the authorized and issued share capital of VGC;
(v) the VGC Shares have been duly and validly allotted and issued as
fully paid and non-assessable shares in the capital of VGC;
(vi) the VGC Shares have been conditionally approved for listing on
the Stock Exchanges, subject to the filing of the required
documents within the time stipulated by the Stock Exchanges;
(vii) VGC is a reporting issuer not in default under the
SECURITIES ACT (British Columbia);
(viii) no prospectus is required and, except as have been obtained
or completed, no approval or consent of or filing with any
governmental authority in the British Columbia or the Stock
Exchanges is required in order to qualify the issuance and sale
by VGC of the VGC Shares except for the filing within 10 days of
the Closing Date of reports in prescribed form prepared and
executed in accordance with the Securities Laws and except as may
be required by the Stock Exchanges in connection with the sale of
the VGC Shares; and
(ix) the hold periods and resale restrictions applicable to the VGC
Shares under the Securities Laws.
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The foregoing conditions are inserted for the exclusive benefit of the Vendor
and CRL and may be waived in whole or in part by the Vendor or CRL at any time.
5.3 CONDITIONS FOR THE BENEFIT OF THE PURCHASER AND VGC
The obligation of the Purchaser and VGC to complete the purchase of
the Purchased Shares and the transactions contemplated by this Agreement is
subject to the satisfaction on or before the Closing, for the exclusive benefit
of the Purchaser and VGC, of each of the following conditions:
(a) the representations and warranties of the Vendor and CRL herein and in
the VGC Subscription Agreement shall be true and correct in all
material respects as at the Closing with the same force and effect as
if such representations and warranties had been made at and as of the
Closing;
(b) the Vendor and CRL shall have, in all material respects, performed and
complied with all covenants and agreements contained in this Agreement
to be performed or complied with, or caused to be performed or
complied with, by the Vendor or CRL at or prior to the Closing;
(c) since the date of this Agreement, there shall not have been any
adverse material change in the business, operations, assets,
liabilities, ownership, capital or financial position or condition of
Mineral Ridge, or change in a material fact that has a significant
adverse affect on, or would reasonably be expected to have a
significant adverse effect on, the business, operations, assets,
liabilities, ownership, capital or financial position or condition of
Mineral Ridge;
(d) except as previously disclosed to and consented to in writing by VGC,
there being no outstanding options, warrants or other rights to
acquire shares of Mineral Ridge or any material change in compensation
or benefits arrangements with any director, officer or employee of
Mineral Ridge;
(e) the completion by VGC of a due diligence review satisfactory to VGC,
in its sole discretion, acting reasonably, of the financial condition,
business, affairs, properties and assets of Mineral Ridge;
(f) the receipt by the Purchaser and VGC of confirmation satisfactory to
the Purchaser and VGC that the purchase of the Purchased Shares and
the transactions contemplated by this Agreement have been approved by
the required majority of the shareholders of the Vendor and CRL or
that such approvals are not required;
(g) each of the Vendor and CRL shall have delivered to the Purchaser and
VGC a certificate, dated as of the Closing, and signed by any two of
its officers acceptable to the Purchaser and VGC certifying that:
(i) the representations and warranties of the Vendor and CRL herein
contained are true and correct at the Closing;
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(ii) each of the Vendor and CRL has performed and complied with all
covenants and agreements contained in this Agreement to be
performed or complied with by the Vendor and CRL at or prior to
the Closing;
(iii) all necessary corporate action has been taken by the Vendor
and CRL to authorize the execution and delivery of this Agreement
and to consummate the transactions contemplated by this
Agreement; and
(iv) since the date of this Agreement there has not been any adverse
material change in the business, operations, assets, liabilities,
ownership, capital or financial position or condition of Mineral
Ridge, or change in a material fact that has a significant
adverse effect on, or would reasonably be expected to have a
significant adverse effect on, the business, operations, assets,
liabilities, ownership, capital or financial position or
condition of Mineral Ridge;
(h) the Vendor and CRL shall have delivered to the Purchaser:
(i) resignations in writing of all directors and officers of Mineral
Ridge;
(ii) certified copies of resolutions of the directors of the Vendor
approving the transfer of the Purchased Shares to the Purchaser
and all other transactions contemplated by this Agreement;
(iii) duly executed share certificates registered on the books of
Mineral Ridge in the name of the Purchaser representing the
Purchased Shares;
(iv) confirmation, in a form satisfactory to VGC, that the execution
and performance of this Agreement by CRL and the Vendor has been
approved by the required majority of the shareholders of CRL and
the Vendor or that such approval is not required; and
(v) such other documentation and assurances reasonably required by
VGC or its counsel; and
(i) counsel to the Vendor and CRL shall have delivered to the Purchaser
and VGC favourable legal opinions, dated the Closing, in form and
content to the reasonable satisfaction of the Purchaser and VGC and
with respect to all such matters as the Purchaser and VGC may
reasonably request including, without limitation, the following:
(i) each of CRL, the Vendor and Mineral Ridge is duly organized and
is a validly existing company, is in good standing under
applicable laws, and is duly qualified to carry on business and
own property under the laws of any other jurisdictions in which
it carries on business or owns property;
(ii) Mineral Ridge has all necessary corporate power and authority to
own its Assets and to carry on its Business as now conducted;
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(iii) this Agreement has been duly authorized by all necessary
corporate action on the part of the Vendor and CRL, has been duly
executed and delivered by and on behalf of the Vendor and CRL,
and is valid and legally binding upon the Vendor and CRL;
(iv) all necessary steps, authorizations and approvals have been taken
or obtained by the Vendor and CRL to authorize the execution and
delivery by the Vendor and CRL of the Agreement and the
performance of their respective obligations thereunder;
(v) so far as counsel is aware, none of the execution and delivery of
this Agreement, nor the fulfilment of its terms, conflicts or
shall conflict with or results or shall result in a breach of any
of the terms, conditions or provisions of the Constating
Documents of either the Vendor or Mineral Ridge, resolutions of
the shareholders and directors of the Vendor or Mineral Ridge,
any applicable laws, or, so far as counsel is aware, any material
license or permit issued to the Vendor or Mineral Ridge or any
material agreement or instrument to which the Vendor or Mineral
Ridge is a party, other than as disclosed in Schedule "E" to this
Agreement;
(vi) so far as counsel is aware, there is no threatened, pending or
actual litigation against or involving Mineral Ridge, other than
as disclosed in Schedule "I" to this Agreement;
(vii) the authorized and issued share capital of Mineral Ridge;
(viii) according to the register of shareholders of Mineral Ridge,
the Vendor is the registered holder of all of the issued and
outstanding shares of Mineral Ridge;
(ix) all necessary steps, authorizations and approvals have been taken
or obtained by Mineral Ridge to authorize the due and valid
transfer of the Purchased Shares at the Closing from the Vendor
to the Purchaser and the consummation of the transactions
contemplated by the Agreement; and
(x) the form of certificates representing the Purchased Shares comply
with the memorandum and articles of Mineral Ridge, the
requirements of the applicable corporate statutes of the State of
Nevada and have been duly approved by the directors of Mineral
Ridge,
it being understood that counsel may rely as to matters of fact, to
the extent appropriate in the circumstances, on certificates of the
Vendor's, CRL's and Mineral Ridge's auditors and on certificates of
the Vendor, CRL and Mineral Ridge executed on behalf of the Vendor,
CRL and Mineral Ridge by a senior officer of the Vendor, CRL and
Mineral Ridge, as the case may be.
The foregoing conditions are inserted for the exclusive benefit of the Purchaser
and VGC and may be waived in whole or in part by the Purchaser and VGC at any
time.
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PART 6
SURVIVAL OF REPRESENTATIONS AND INDEMNITY
6.1 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS
The representations, warranties and covenants of each of the parties
hereto contained in this Agreement shall survive the Closing and the completion
of the transactions contemplated hereby and shall continue in full force and
effect for a period of two years thereafter.
6.2 INDEMNITY
In addition to any other rights or remedies the Purchaser and VGC have
under this Agreement, each of the Vendor and CRL shall indemnify and save the
Purchaser and VGC harmless from and against all losses, costs, damages,
expenses, penalties and liabilities suffered or incurred by the Purchaser or VGC
by reason of:
(a) a breach of any representation or warranty, covenant or agreement in
this Agreement by the Vendor or CRL; and
(b) without limiting the generality of the foregoing, any Liability,
disclosed or undisclosed, known or unknown, determined or
undetermined, which was created or existing or arose out of acts or
omissions prior to the Closing in connection with the Assets, the
Business or the Purchased Shares which the Purchaser or VGC is
required to discharge, to the extent such Liability has not been
incurred or created by the Purchaser or VGC after the Closing.
PART 7
GENERAL
7.1 TIME AND PLACE OF CLOSING
The Closing shall take place at 9:00 a.m. (Vancouver time) on the
Closing Date at the offices of DuMoulin Black in Vancouver, British Columbia, or
at such other place or date as may be mutually agreed by the parties.
7.2 NOTICES
Any notice or other communication which is required or permitted to be
given pursuant to any provision of this Agreement shall be in writing, delivered
personally, by registered mail or by telecopy, and addressed as follows:
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(a) in the case of a notice or other communication to the Vendor or CRL:
Cornucopia Resources Ltd.
▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇.▇. ▇▇▇▇▇▇▇▇
Telecopier Number: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
DuMoulin Black
▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇.▇.
▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telecopier Number: (▇▇▇) ▇▇▇-▇▇▇▇
(b) in the case of a notice or other communication to the Purchaser or
VGC:
Vista Gold Corp.
Suite 3000, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇.▇.▇. ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telecopier Number: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telecopier Number: (▇▇▇) ▇▇▇-▇▇▇▇
or such other address or telecopier number as a party may, from time to time,
advise the other parties hereto by notice in writing given in accordance with
the foregoing. The date of receipt of any such notice shall be deemed to be the
date of delivery thereof, if delivered, and on the day of telecopying, if
telecopied, provided such day is a Business Day and, if not, on the first
Business Day thereafter.
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7.3 CONFIDENTIALITY AND DISCLOSURE
(a) Except as may be required by applicable laws, any information
concerning any of the Vendor, the Purchaser, CRL, VGC or Mineral Ridge
and their respective affiliates disclosed to the other parties to this
Agreement or their representatives, which has not been publicly
disclosed, shall be kept strictly confidential by them and shall not
be disclosed or used by the recipients thereof whether or not the
Closing occurs until publicly disclosed by the party to which such
information relates. Further, it is agreed and acknowledged that all
such information is being disclosed solely for the purpose of
completing the transactions contemplated by this Agreement and shall
not be used for any other purpose. In the event that the Closing does
not occur, all documents, if any, of a confidential nature, delivered
to the Vendor, the Purchaser, CRL or VGC or their respective
representatives and any copies thereof shall be immediately returned
to the party to which such information relates.
(b) Except as may be required under applicable laws, no press releases or
material change reports relating to the transactions contemplated
hereby shall be issued by any party to this Agreement, nor shall the
terms of this letter be disclosed to third parties other than the
representatives of the parties, without the mutual consent of the
other parties. All necessary press releases and material change
reports required form shall be submitted for approval by the party
preparing such press release or material change report to the other
parties prior to the filing thereof in accordance with applicable
laws.
7.4 DISPUTE RESOLUTION AND ARBITRATION
In the event of a dispute under or related to this Agreement, the
parties agree to negotiate diligently and in good faith the satisfactory
resolution of such dispute. Failing such resolution, the dispute shall be
resolved by binding arbitration pursuant to the COMMERCIAL ARBITRATION ACT
(British Columbia). Submission to arbitration shall be to a single arbitrator
appointed by agreement between the Purchaser and the Vendor within 10 days after
either party gives notice to the other specifying the matter to be submitted to
arbitration. Failing the appointment of an arbitrator within such 10 days the
arbitrator may be appointed in the manner provided under section 17 of the
COMMERCIAL ARBITRATION ACT (British Columbia). The arbitration shall take place
in the City of Vancouver, British Columbia.
7.5 GOVERNING LAW
This Agreement shall be governed by and construed in accordance with
the laws of the Province of British Columbia and the laws of Canada applicable
therein and each of the parties irrevocably attorns to the jurisdiction of the
courts of British Columbia.
7.6 BINDING EFFECT
This Agreement shall be binding upon and shall enure to the benefit of
the parties hereto and their respective successors and permitted assigns.
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7.7 TIME OF ESSENCE
Time is of the essence of this Agreement.
7.8 ASSIGNMENT
Subject to the express provisions of this Agreement, neither of the
parties may assign his or its rights or obligations under this Agreement without
the prior written consent of the other, such consent not to be unreasonably
withheld.
7.9 FURTHER ASSURANCES
Each of the parties, upon the request of any other party, whether
before or after the Closing, shall do, execute, acknowledge and deliver or cause
to be done, executed, acknowledged or delivered all such further acts, deeds,
documents, assignments, transfers, conveyances and assurances as may be
reasonably necessary or desirable to effect complete consummation of the
transactions contemplated by this Agreement.
7.10 EXPENSES
The Vendor and the Purchaser shall each pay their respective expenses
incurred in connection with this Agreement and the transactions contemplated by
this Agreement.
7.11 ENTIRE AGREEMENT
The terms and provisions contained in this Agreement constitute the
entire agreement between the parties pertaining to the subject matter hereof and
supersede all prior agreements, understandings, negotiations and discussions,
whether oral or written, between the parties with respect to the subject matter
hereof.
-36-
7.12 COUNTERPARTS AND FACSIMILE
This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original but all of which together shall
constitute one and the same instrument. This Agreement and any counterpart
thereof may be executed by telecopy and when delivered shall be deemed to be an
original.
IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the day
and year first above written.
CORNUCOPIA RESOURCES INC.
Per: /s/ (AUTHORIZED SIGNATORY)
---------------------------------
Authorized Signatory
Per: /s/ (AUTHORIZED SIGNATORY)
---------------------------------
Authorized Signatory
CORNUCOPIA RESOURCES LTD.
Per: /s/ (AUTHORIZED SIGNATORY)
-------------------------------
Authorized Signatory
Per: /s/ (AUTHORIZED SIGNATORY)
-------------------------------
Authorized Signatory
VISTA GOLD HOLDINGS INC.
Per: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇,
President
VISTA GOLD CORP.
Per: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇,
President and Chief Executive Officer
-37-
SCHEDULE "A"
FINANCIAL STATEMENTS
[NOTE TO DRAFT: PROVIDED TO ▇▇▇▇▇▇ DOWNS BY CRL.]
A-1
SCHEDULE "B"
LOANS AND CREDIT FACILITIES
LENDER TYPE OF AGREEMENT NATURE OF LOAN OR CREDIT FACILITY
Dresdner Mine Debt Financing Facility January 17, 1997 in the amount of $13.0 million with a $2.0 million
contingency reserve facility.
Dresdner Letter of Credit Modified Letter of Credit in the amount of $1,089,242.
Dresdner Hedge Facility 64,000 ounces Au for value $341.745 October 30,1998
4,000 ounces Au for value $406.550 October 30,1998
8,000 ounces Au for value $389.635 December 31,1998
4,000 ounces Au for value $410.640 March 31, 1999
8,000 ounces Au for value $394.905 June 30, 1999
4,000 ounces Au for value $416.380 September 30, 1999
8,000 ounces Au for value $400.265 December 31, 1999
B-1
SCHEDULE "C"
BANK FACILITIES
BANK OF AMERICA
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
TYPE OF ACCOUNT CURRENCY ACCOUNT NUMBER G/L ACCOUNT AUTHORIZED PERSONS
General US 220200463 1041 ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
Pacific Horizon US 1033 ▇▇▇▇▇ ▇▇▇▇▇▇▇
Temporary Investment ▇▇▇▇▇ ▇▇▇▇▇▇▇
Cultural Bond US 470035549 ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇ ▇▇▇▇ Management ▇▇▇ ▇▇▇▇▇▇▇▇▇▇, BLM
Security Account
BANK OF MONTREAL
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇.▇.
General CDN ▇▇▇▇-▇▇▇▇-▇▇▇ 1030 ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
General US ▇▇▇▇-▇▇▇▇-▇▇▇ 1034 ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
RBC DOMINION SECURITIES
▇▇▇▇-▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇.▇.
Temporary Investment US ▇▇▇-▇▇▇▇▇-▇▇ 1033 ▇▇▇▇▇ ▇▇▇▇▇▇▇
C-1
SCHEDULE "D"
MATERIAL CONTRACTS
OTHER PARTY TYPE OF AGREEMENT DATE AND AMOUNT OF CONTRACT
Dresdner Mine Debt Financing January 17, 1997 in the amount of
Facility, Collateral $13.0 million with a $2.0 million
Assignment of Material $2.0 million contingency reserve
Project Agreement, facility.
Collateral Assignment
of Accounts
Dresdner Letter of Credit Modified Letter of Credit in the
amount of $1,089,242.
Dresdner Hedge Facility Contracts for 100,000 ounces of
gold at various future dates and
prices. See Schedule "B".
▇.▇. ▇▇▇▇▇▇▇▇ & Open Pit Mining October 1, 1996 with scheduled
Sons, Inc. Contract unit prices.
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Mineral Ridge Project August 20, 1998 in the original
Company Construction Contract fixed price amount of $12,399,672.
Van American Reclamation Bonding September 30, 1996 for 50% of the
estimated reclamation amount of
$1,604,086 and with a $32,801.72
annual premium.
▇▇▇▇ Mining Deed with Reservation December 30, 1996 in the amounts
Company, Inc. of Net Smelter Returns set out in Schedule "G".
Royalty
Benguetcorps USA, Royalty Agreement August 31, 1995 in the amounts
Inc. set out in Schedule "G".
Sierra Pacific Power Electric Service July 11, 1997 with a present
Company Agreement value of $1,104,317.81 at the
date of signing.
D-1
SCHEDULE "E"
MATERIAL CONTRACTS IN BREACH OR DEFAULT
OTHER PARTY TYPE OF AGREEMENT NATURE OF BREACH OR DEFAULT
Dresdner Mine Debt Financing Certain material financial covenants and
Facility nonpayment of certain principal and interest
amounts from September 30, 1997.
Dresdner Letter of Credit Nonpayment of Letter of Credit fee for the
period from February 1, 1998 to September 30,
1998.
▇.▇. ▇▇▇▇▇▇▇▇ & Open Pit Mining Nonpayment of $1,466,746.90 for mining
Sons, Inc. Contract contracting invoices and certain other amounts
in a lien claim as described in Schedule "I".
▇▇▇▇▇▇▇ & Mineral Ridge Project Nonpayment of $637,054.25 for holdbacks
▇▇▇▇▇▇▇▇ Construction Contract invoices and certain other amounts in a lien
Company claim as described in Schedule "I".
Van American Reclamation Bonding Failure to make payment which was requested
April 24, 1998 in the amount of $719,700
under the General Contract of Indemnity,
Section 2(b).
▇▇▇▇ Mining Deed with Reservation Failure to make payment in the amount of
Company, Inc. of Net Smelter Returns $60,000 due July 21, 1998 for advance royalty.
Royalty
E-1
SCHEDULE "F"
MINERAL RIGHTS AND LANDS
1. Unpatented Claims
Mineral Ridge Resources Inc.
------------------------------------------------------------------------------------------------------------------
CLAIM NAME TOWNSHIP SECTION RANGE BOOK PAGE LOCATION DATE BLM SERIAL NUMBER
------------------------------------------------------------------------------------------------------------------
New ▇▇▇▇▇▇ V 2 S 1 38 E 94(182) 502(335) 9/2/84 324341
------------------------------------------------------------------------------------------------------------------
K 2 2 S 1, 2 38 E 94(182) 504(337) 9/1/84 324343
------------------------------------------------------------------------------------------------------------------
Wedge 4 2 S 1 38 E 111 329 2/4/87 403136
------------------------------------------------------------------------------------------------------------------
Wedge 5 2 S 1 38 E 111 330 2/4/87 403137
------------------------------------------------------------------------------------------------------------------
Wedge 8 2 S 2 38 E 111 333 2/5/87 403140
------------------------------------------------------------------------------------------------------------------
Wedge 9 2 S 1, 2 38 E 111(182) 334(341) 2/5/87 403141
------------------------------------------------------------------------------------------------------------------
Wedge 10 2 S 2 38 E 111 335 2/4/87 403142
------------------------------------------------------------------------------------------------------------------
Wedge 11 2 S 2 38 E 111 336 2/4/87 403143
------------------------------------------------------------------------------------------------------------------
Mineral Ridge 1 2 S 1 38 E 113 407 7/1/87 420478
------------------------------------------------------------------------------------------------------------------
Mineral Ridge 2 2 S 1 38 E 113 408 7/1/87 420479
------------------------------------------------------------------------------------------------------------------
Mineral Ridge 3 2 S 1 38 E 113(182) 409(339) 7/1/87 420480
------------------------------------------------------------------------------------------------------------------
▇▇▇ 1 2 S 2 38 E 182 371 11/29/95 725982
------------------------------------------------------------------------------------------------------------------
▇▇▇ 2 2 S 2 38 E 182 372 11/29/95 725983
------------------------------------------------------------------------------------------------------------------
▇▇▇ 3 2 S 2 38 E 182 373 11/29/95 725984
------------------------------------------------------------------------------------------------------------------
▇▇▇ 4 2 S 2 38 E 182 374 11/29/95 725985
------------------------------------------------------------------------------------------------------------------
▇▇▇ 5 2 S 2 38 E 182 375 11/29/95 725986
------------------------------------------------------------------------------------------------------------------
▇▇▇ 6 2 S 1, 2 38 E 182 376 11/29/95 725987
------------------------------------------------------------------------------------------------------------------
▇▇▇ 7 2 S 1, 2 38 E 182 377 11/29/95 725988
------------------------------------------------------------------------------------------------------------------
▇▇▇ 8 2 S 1 38 E 182 378 11/29/95 725989
------------------------------------------------------------------------------------------------------------------
NCY 1 2 S 11, 12 38 E 182 350 11/28/95 725990
------------------------------------------------------------------------------------------------------------------
NCY 2 2 S 1,2,11,12 38 E 182 351 11/28/95 725991
------------------------------------------------------------------------------------------------------------------
NCY 3 2 S 12 38 E 182 352 11/28/95 725992
------------------------------------------------------------------------------------------------------------------
NCY 4 2 S 1, 12 38 E 182 353 11/28/95 725993
------------------------------------------------------------------------------------------------------------------
NCY 5 2 S 12 38 E 182 354 11/28/95 725994
------------------------------------------------------------------------------------------------------------------
NCY 6 2 S 12 38 E 182 355 11/28/95 725995
------------------------------------------------------------------------------------------------------------------
NCY 7 2 S 1, 12 38 E 182 356 11/28/95 725996
------------------------------------------------------------------------------------------------------------------
NCY 8 2 S 12 38 E 182 357 11/28/95 725997
------------------------------------------------------------------------------------------------------------------
NCY 9 2 S 1, 12 38 E 182 358 11/28/95 725998
------------------------------------------------------------------------------------------------------------------
NCY 10 2 S 12 38 E 182 359 11/28/95 725999
------------------------------------------------------------------------------------------------------------------
NCY 11 2 S 1, 12 38 E 182 360 11/28/95 726000
------------------------------------------------------------------------------------------------------------------
NCY 12 2 S 1, 12 38 E 182 361 11/28/95 726001
------------------------------------------------------------------------------------------------------------------
NCY 13 2 S 11, 12 38 E 182 362 11/28/95 726002
------------------------------------------------------------------------------------------------------------------
NCY 14 2 S 12 38 E 182 363 11/28/95 726003
------------------------------------------------------------------------------------------------------------------
NCY 15 2 S 12 38 E 182 364 11/28/95 726004
------------------------------------------------------------------------------------------------------------------
NCY 16 2 S 12 38 E 182 365 11/28/95 726005
------------------------------------------------------------------------------------------------------------------
NCY 17 2 S 12 38 E 182 366 11/28/95 726006
------------------------------------------------------------------------------------------------------------------
NCY 18 2 S 12 38 E 182 367 11/28/95 726007
------------------------------------------------------------------------------------------------------------------
NCY 19 2 S 11, 12 38 E 182 368 11/29/95 726008
------------------------------------------------------------------------------------------------------------------
NCY 20 2 S 12 38 E 182 369 11/29/95 726009
------------------------------------------------------------------------------------------------------------------
NCY 21 2 S 12 38 E 182 370 11/29/95 726010
------------------------------------------------------------------------------------------------------------------
Con 1 2 S 1, 2 38 E 182 347 11/29/95 726011
------------------------------------------------------------------------------------------------------------------
Con 2 2 S 1, 2 38 E 182 348 11/29/95 726012
------------------------------------------------------------------------------------------------------------------
MIK 1 2 S 1 38 E 182 349 11/29/95 726013
------------------------------------------------------------------------------------------------------------------
Ben 1 2 S 1 38 E 184 312-313 3/29/96 735112
------------------------------------------------------------------------------------------------------------------
Ben 2 2 S 1 38 E 184 314-315 3/29/96 735113
------------------------------------------------------------------------------------------------------------------
Ben 3 2 S 1 38 E 184 316-317 3/29/96 735114
------------------------------------------------------------------------------------------------------------------
Ben 4 2 S 1, 2 38 E 184 318-319 3/29/96 735115
------------------------------------------------------------------------------------------------------------------
CC 1 2 S 7, 8 39 E 194 169 1/13/98 786167
------------------------------------------------------------------------------------------------------------------
CC 2 2 S 8 39 E 194 170 1/13/98 786168
------------------------------------------------------------------------------------------------------------------
CC 3 2 S 8 39 E 194 171 1/13/98 786169
------------------------------------------------------------------------------------------------------------------
CC 4 2 S 8 39 E 194 172 1/13/98 786170
------------------------------------------------------------------------------------------------------------------
CC 5 2 S 8 39 E 194 173 1/13/98 786171
------------------------------------------------------------------------------------------------------------------
CC 6 2 S 8 39 E 194 174 10/31/97 786172
------------------------------------------------------------------------------------------------------------------
CC 7 2 S 8 39 E 194 175 10/31/97 786173
------------------------------------------------------------------------------------------------------------------
CC 8 2 S 5, 8 39 E 194 176 10/31/97 786174
------------------------------------------------------------------------------------------------------------------
CC 9 2 S 5, 8 39 E 194 177 10/31/97 786175
------------------------------------------------------------------------------------------------------------------
CC 10 2 S 7, 8 39 E 194 178 1/13/98 786176
------------------------------------------------------------------------------------------------------------------
CC 11 2 S 7, 8 39 E 194 179 1/13/98 786177
------------------------------------------------------------------------------------------------------------------
CC 12 2 S 7, 8 39 E 194 180 1/13/98 786178
------------------------------------------------------------------------------------------------------------------
CC 13 2 S 5, 8 39 E 194 181 10/31/97 786179
------------------------------------------------------------------------------------------------------------------
CC 14 2 S 5, 8 39 E 194 182 10/31/97 786180
------------------------------------------------------------------------------------------------------------------
CC 15 2 S 5 39 E 194 183 10/31/97 786181
------------------------------------------------------------------------------------------------------------------
CC 16 2 S 5 39 E 194 184 10/31/97 786182
------------------------------------------------------------------------------------------------------------------
CC 17 2 S 7 39 E 194 185 10/29/97 786183
------------------------------------------------------------------------------------------------------------------
CC 18 2 S 7 39 E 194 186 10/29/97 786184
------------------------------------------------------------------------------------------------------------------
CC 19 2 S 6 39 E 194 187 10/29/97 786185
------------------------------------------------------------------------------------------------------------------
CC 20 2 S 6 39 E 194 188 10/29/97 786186
------------------------------------------------------------------------------------------------------------------
CC 21 2 S 5, 6 39 E 194 189 10/29/97 786187
------------------------------------------------------------------------------------------------------------------
CC 22 2 S 5 39 E 194 190 10/29/97 786188
F-1
------------------------------------------------------------------------------------------------------------------
CLAIM NAME TOWNSHIP SECTION RANGE BOOK PAGE LOCATION DATE BLM SERIAL NUMBER
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 1 1, 2 S 36, 1 38 E 9 419 2/9/73 89365
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 2 1, 2 S 36, 1 38 E 9 420 2/9/73 89366
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 3 2 S 1 38 E 9 421 2/9/73 89367
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 4 1, 2 S 36, 1 38 E 9 422 2/9/73 89368
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 5 1, 2 S 36, 1 38 E 9 423 2/9/73 89369
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 6 1 S 36 38 E 9 424 2/9/73 89370
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 7 2 S 36, 1 38 E 9 425 2/9/73 89371
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 8 1 S 36 38 E 9 426 2/9/73 89372
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 9 1, 2 S 1,6,36,31 38, 39 E 9 427 2/9/73 89373
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 10 1 S 36 38 E 9 428 2/9/73 89374
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 11 1 S 36, 31 38, 39 E 9 429 2/9/73 89375
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 12 1 S 36 38 E 9 430 2/9/73 89376
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 13 1 S 36, 31 38, 39 E 9 431 2/9/73 89377
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 14 1 S 36, 31 38, 39 E 9 432 2/9/73 89378
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 15 1 S 36, 31 38, 39 E 9 433 2/9/73 89379
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 16 1 S 36, 31 38, 39 E 9 434 2/9/73 89380
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 17 1 S 31 39 E 9 435 2/9/73 89381
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 18 1 S 36, 31 38, 39 E 9 436 2/9/73 89382
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 19 1 S 31 39 E 9 437 2/9/73 89383
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 21 2 S 1, 6 38, 39 E 9 439 2/12/73 89385
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 22 1, 2 S 31, 1, 6 38, 39 E 9 440 2/12/73 89386
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 23 1, 2 S 31, 6 39 E 9 441 2/12/73 89387
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 24 1, 2 S 31, 6 39 E 9 442 2/12/73 89388
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 25 1 S 31 39 E 9 443 2/12/73 89389
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 26 1, 2 S 31, 6 39 E 9 444 2/12/73 89390
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 27 1 S 31 39 E 9 445 2/12/73 89391
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 28 1, 2 S 31, 6 39 E 9 446 2/12/73 89392
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 29 1 S 31 39 E 9 447 2/12/73 89393
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 30 1 S 31 39 E 9 448 2/12/73 89394
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 31 1 S 31 39 E 9 449 2/12/73 89395
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 32 1 S 31 39 E 9 450 2/12/73 89396
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 33 2 S 1 38 E 9 451 2/13/73 89397
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 34 2 S 1 38 E 9 452 2/13/73 89398
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 35 2 S 1, 12 38 E 9 453 2/13/73 89399
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 36 2 S 1 38 E 9 454 2/13/73 89400
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 37 2 S 1, 12 38 E 9 455 2/13/73 89401
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 38 2 S 1, 12 38 E 9 456 2/13/73 89402
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 39 2 S 1, 6 38, 39 E 9 457 2/13/73 89403
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 40 2 S 1, 6 38, 39 E 9 458 2/13/73 89404
------------------------------------------------------------------------------------------------------------------
T.W. No. 1 2 S 6 39 E 7 453 7/14/72 89406
------------------------------------------------------------------------------------------------------------------
Bonanza # I 2 S 6 39 E 10 314 4/14/60 89408
------------------------------------------------------------------------------------------------------------------
Bonanza # II 2 S 6 39 E 10 315 4/14/60 89409
------------------------------------------------------------------------------------------------------------------
▇▇▇▇ 200 2 S 1 38 E 175 85 1/23/94 694688
------------------------------------------------------------------------------------------------------------------
F-2
2. Patented Claims
------------------------------------------
SUMMARY
Claims Acres
mine area, MMC 34 378.6
▇▇▇▇▇, MMC 8 165.0
Valcalda Spgs, 1 125.0
MMC(1)
Silver Peak, MMC 2 9.6
------------------------------------------
SUBTOTAL, MMC 45 678.1
MRRI, Silver 0 0.9
Peak(2)
BUSA, mine area 9 169.9
------------------------------------------
GRAND TOTAL 54 848.9
------------------------------------------
1. includes 120.0 acres FEE land
2. town lot
OWNERS (CLAIMANTS):
"MMC" ▇▇▇▇ Mining Company, Inc., Trustee for the Land Trust Agreement,
Trust No. 6050934, dated March 8, 1993; c/o ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇.,
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇., ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇; tele: 813 223 4785
"MRRI" Mineral Ridge Resources Inc., ▇▇ ▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
tele: ▇▇▇ ▇▇▇ ▇▇▇▇
"BUSA" Benguetcorps USA, Inc., c/o ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇.,
▇.▇., ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇; tele: ▇▇▇ ▇▇▇ ▇▇▇▇
"DUD" and "ST" ▇▇▇▇▇ ▇▇▇▇▇▇ and Stewarts (own overriding royalty in
certain lands)
LOC (LOCATION):
"MR" = Mineral Ridge; "BL" = ▇▇▇▇▇ townsite; "SP" = Silver Peak;
"VS" = Valcalda Springs
MIN ▇▇▇ COUNTY LEASE SUB-OWNED
REFp CLAIMp SURVp NOp ACRESp BKp PGp LOCp OWNRp 1p 2p NOTESp
---------------------------------------------------------------------------------------------------------------------
P57 Horned Toad 3507 197172 165.003 171 33 BL MMC ▇▇▇▇ Mining patented
claims in the Pittsburg
group (8 claims) contain
165.003 acres
P58 Spider 3507 197172 171 33 BL MMC
P59 Scorpion 3507 197172 171 33 BL MMC
P60 Lizard 3507 197172 171 33 BL MMC
P61 Cactus 3507 197172 171 33 BL MMC
P62 Gnat 3507 197172 171 33 BL MMC
P63 Rattlesnake 3507 197172 171 33 BL MMC
P64 Pittsburg 3507 197172 171 33 BL MMC
P20 ▇▇▇▇ 64 18078 20.660 3-B 207 MR MMC
P21 ▇▇▇▇▇▇▇▇▇ 1927 35160 20.357 2 64 MR MMC aka "Homestake", M.S. 63
P23 Last Chance 42 3311 2.520 M 32 MR MMC
Lode
P24 Western 43 3312 4.550 M 37 MR MMC
Soldier Lode
P25 Glory Lode 44 3313 2.020 M 42 MR MMC
P26 Crowning Glory 45 3314 2.720 M 47 MR MMC
Lode
P27 " " , 46 3315 0.680 M 52 MR MMC First Southern Extension
1st S. EXT. of the Crowning Glory Lode
P28 Drink Water 47 3318 2.290 M 58 MR MMC
Lode
P29 Valient 48 3160 0.910 M 22 MR MMC
P30 New York Lode 49 3319 2.730 M 65 MR MMC
P31 Chieftan Lode 50 3320 2.020 M 68 MR MMC
P32 Defiance 59 24006 19.210 V 560 MR MMC
P33 Sentinel 60 23857 ▇▇.▇▇▇ ▇ ▇▇ ▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ 61 23858 20.660 W 88 MR MMC
P35 Crown Lode 65-A 27739 2.880 W 436 MR MMC
P37 ▇▇▇▇▇ 66 19164 14.070 V 407 MR MMC
P38 Antelope Mine 1736 28805 6.310 X 23 MR MMC
P39 Nevada 1738 28806 10.300 X 21 MR MMC
P40 Duplex 1739 29324 16.820 X 25 MR MMC
P41 Bangor 1740 29323 17.800 X 27 MR MMC
P43 Brooklyn 1742 28807 17.510 X 19 MR MMC
P44 Mohawk 3068 216115 171.784 3-B 202 MR MMC The entire Mohawk claim
group (13 claims) contains
171.784 acres
P45 Mohawk #1 3068 216115 3-B ▇▇▇ ▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇ #▇ 3068 216115 3-B 202 MR MMC
P47 Savage 3068 216115 3-B 202 MR MMC
P48 Oro Fino 3068 216115 3-B 202 MR MMC
P49 Poor 3068 216115 3-B 202 MR MMC
F-3
MIN ▇▇▇ COUNTY LEASE SUB-OWNED
REFp CLAIMp SURVp NOp ACRESp BKp PGp LOCp OWNRp 1p 2p NOTESp
---------------------------------------------------------------------------------------------------------------------
P50 Sapphire 3068 216115 3-B 202 MR MMC
P51 Snow Drift 3068 216115 3-B 202 MR MMC
P52 Ophir 3068 216115 3-B 202 MR MMC
P53 ▇▇▇▇ Extension 3068 216115 3-B 202 MR MMC
P54 Summit 3068 216115 3-B 202 MR MMC
P55 April 3068 216115 ▇-▇ ▇▇▇ ▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ 3068 216115 3-B 202 MR MMC
P01 Columbus Lode 2665 71074 169.895 ▇▇ ▇▇▇▇ Oromonte group (9 claims)
contains 169.895 acres
P02 ▇▇▇▇▇ No. 2 2665 71074 ▇▇ ▇▇▇▇
Lode
P03 Lincoln Lode 2665 71074 ▇▇ ▇▇▇▇
P04 Washington Lode 2665 71074 ▇▇ ▇▇▇▇
P05 Soda Lode 2665 71074 ▇▇ ▇▇▇▇ DUD
P06 Oregon Lode 2665 71074 ▇▇ ▇▇▇▇ DUD
P07 Peorto Lode 2665 71074 ▇▇ ▇▇▇▇ DUD
P08 Solberry Lode 2665 71074 ▇▇ ▇▇▇▇ DUD ST
P09 ▇▇▇▇▇▇▇▇ Lode 2665 71074 ▇▇ ▇▇▇▇ DUD ST
P22 Vanderbilt 37-B 3156 4.970 M 1 SP MMC
Millsite
P42 ▇▇▇▇▇▇ Lode 1741 31286 4.600 X 34 SP MMC
▇▇▇ ▇, ▇▇▇▇▇ ▇ ▇.▇▇▇ ▇▇ ▇▇▇▇ ▇ houses
FEE (ex-State 120.000 VS MMC
land)
P36 Crown Millsite 65-B ▇▇▇▇▇ ▇.▇▇▇ ▇ ▇▇▇ VS MMC
3. Patented Lands
(a) Southeast 1/4, Section 8
T.2 S., R.38 E.,
M. D. B. & M.
(b) North 1/2, Northeast 1/4, Section 17
T. 2 S., R.38 E.,
M.D.B. & M.
F-4
SCHEDULE "G"
ROYALTY INTERESTS
1. ▇▇▇▇ MINING COMPANY INC.
4% net smelter royalty ("NSR") where gold price less than or equal to
$500 per ounce
Applies to all properties acquired from ▇▇▇▇ Mining Company Inc.
2. ▇▇▇▇▇▇
2% NSR where gold price less than $400 per ounce
Applies to:
Soda Claim
Oregon Claim
Peoto Claim
3. ▇▇▇▇▇▇
0.8% NSR where gold price less than $400 per ounce
Applies to:
Soleberry Claim
▇▇▇▇▇▇▇▇ Claim
4. ▇▇▇▇▇▇▇
1.2% NSR where gold price less than $400 per ounce
Applies to:
Soleberry Claim
▇▇▇▇▇▇▇▇ Claim
G-1
SCHEDULE "H"
EQUIPMENT
Pin # ▇▇▇▇-▇▇-▇▇▇
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
ROLL TYPE ASSET YEAR NEW PROP. DESCRIPTION MODEL # SERIAL # ACQ.COST PC
LIFE ACQ.
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
U Fixed A 1996 Sea Container $ 4,467.00
U Fixed A 1996 Telephone Equipment $ 6,972.00
U Fixed A 1996 Telephone Equipment $ 10,000.00
U Fixed A 1996 Sea Container $ 4,467.00
U Fixed A 1996 Pump Water Well $ 71,128.00
U Fixed A 1996 Jayco Industrial Tanks $ 3,339.00
U Fixed A 1996 Telephone Equipment $ 4,953.00
U Fixed A 1997 yes Dust collection ducts $ 114,719.00 yes
U Fixed A 1997 yes Vibrating screens $ 526,642.00
U Fixed A 1997 yes Conveyor covers $ 10,421.00
U Fixed A 1997 yes Structural Steel $ 894,109.00
(crusher)
U Fixed A 1997 yes Rail $ 1,101.00
U Fixed A 1997 yes Radial Stacker $ 114,480.00
U Fixed A 1997 yes Tramp Iron Detector $ 9,603.00
U Fixed A 1997 yes Cement Bin $ 60,131.00
U Fixed A 1997 yes Pulleys Shafts and $ 50,458.00
Bearings
U Fixed A 1997 yes Feeders $ 271,132.00
U Fixed A 1997 yes Idelers $ 39,868.00
U Fixed A 1997 yes Dust Collectors $ 196,703.00 yes
U Fixed A 1997 yes Fans $ 3,759.00
U Fixed A 1997 yes Agglomeration Drum $ 55,072.00
U Fixed A 1997 yes ADR Plant Equipment $ 303,988.00
U Fixed A 1997 yes Belt Scale $ 16,177.00
U Fixed A 1997 yes Safety Shower $ 5,089.00
U Fixed A 1997 yes Magnet $ 19,344.00
U Fixed A 1997 yes Crusher $1,015,407.00
U Fixed A 1997 yes Air Compressor $ 42,543.00
U Fixed A 1997 yes Sewage Treatment $ 16,220.00
U Fixed A 1997 yes Crusher (engin. Labor $ 850,753.00
Cost)
U Fixed A 1997 yes Equip.(Const. $ 422,993.00
Management)
U Fixed A 1997 yes Equip. (General $2,829,079.00
Contract)
U Fixed A 1997 yes Misc. Electrical Parts $ 31,804.00
U Fixed A 1997 yes Emergency Power $ 10,326.00
U Fixed A 1997 yes Controls and $ 117,667.00
Instruments
U Fixed A 1997 yes Transformers $ 479,370.00
U Fixed A 1997 yes Chutes and Fumes $ 323,545.00
U Fixed A 1997 yes MCC Low Voltage $ 241,283.00
U Fixed A 1997 yes Mech Fasteners $ 6,884.00
U Fixed A 1997 yes Oil/Water Separator $ 63,332.00
U Fixed A 1997 yes Piping and Fittings $ 382,863.00
U Fixed A 1997 yes Cetrifigal Pump $ 92,906.00
U Fixed A 1997 yes Operator's Cab $ 27,536.00
U Fixed A 1997 yes Pre-Built Conveyors $ 395,499.00
U Fixed A 1997 yes Reducers $ 85,684.00
H-1
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
ROLL TYPE ASSET YEAR NEW PROP. DESCRIPTION MODEL # SERIAL # ACQ.COST PC
LIFE ACQ.
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
U Fixed A 1997 yes Conveyor Belting $ 42,450.00
U Fixed A 1997 yes Belt Wipers $ 23,014.00
U Fixed A 1997 yes Motors $ 14,719.00
U Fixed A 1997 yes Floor Sumps $ 3,485.00
U Fixed A 1997 yes 40 Foot Sea Container $ 3,233.00
U Fixed A 1997 yes Propane Tank $ 2,820.00
U Fixed A 1997 yes ▇▇▇▇▇▇ RH120 Vaporizer $ 5,390.00
U Fixed A 1997 yes Exhaust Fan $ 122.00
U Fixed A 1997 yes American Resources Transformer $ 1,000.00
U Fixed A 1997 yes Water Well Probe $ 1,027.00
U Fixed A 1997 yes Pea Gravel For Water Piping Syst $ 1,604.00
U Fixed A 1997 yes Process Equipment $ 28,190.00
U Mobile A 1987 Drafting Chair $ 40.00
U Mobile A 1987 Drafting Table $ 70.00
U Mobile A 1987 Drafting Table $ 70.00
U Mobile A 1987 ▇▇▇▇▇ Lettering Set $ 150.00
U Mobile A 1987 Drafting Table $ 70.00
U Mobile A 1987 Drafting Table $ 70.00
U Mobile A 1987 Drafting Chair $ 40.00
U Mobile A 1987 Planix 5000 Planimeter $ 914.00
U Mobile A 1993 Mine lamp w/charger 702C792 $ 303.00
U Mobile A 1993 Plainimeter $ 648.00
U Mobile A 1993 Mine lamp w/charger 610B592 $ 303.00
U Mobile A 1993 2-Way Hand Held Radio 426866 $ 100.00
U Mobile A 1993 2-Way Hand Held Radio 391496 $ 100.00
U Mobile A 1993 2-Way Hand Held Radio 426851 $ 100.00
U Mobile A 1993 Mine lamp w/charger 309N293 $ 303.00
U Mobile A 1993 Mine lamp w/charger 416T693 $ 303.00
U Mobile A 1994 Rolling Plan Holder $ 366.00
U Mobile A 1995 Water Level Probe $ 855.00
U Mobile A 1995 Hanging map File $ 75.00
U Mobile A 1995 Planimeter Battery $ 73.00
Pack
U Mobile A 1995 Drafting Table $ 200.00
U Mobile A 1995 Light Table $ 200.00
U Mobile A 1995 Flat Map File $ 125.00
U Mobile A 1996 yes Lab Equipment $ 1,144.00
U Mobile A 1996 Cabinets $ 24,300.00
U Mobile A 1996 Lab Equipment $ 66.00
U Mobile A 1996 Lab Equipment $ 1,024.00
U Mobile A 1996 BSI Resources Recovery Tanks $ 10,500.00
U Mobile A 1996 Lab Equipment $ 5,735.00
U Mobile A 1996 Welder $ 2,414.00
U Mobile A 1996 Safe $ 5,809.00
U Mobile A 1996 ▇▇▇▇▇ $ ▇▇▇▇▇ Survey Equipment $ 10,448.00
U Mobile A 1996 Lube Trailer $ 8,500.00
U Mobile A 1996 ▇▇▇▇▇ $ ▇▇▇▇▇ Survey Equipment $ 1,628.00
U Mobile A 1996 Legend Inc lab $ 25,129.00
Equipment
U Mobile A 1996 Envirotech Well Probe $ 872.00
U Mobile A 1997 yes Sample Equip. $ 121,708.00
U Mobile A 1997 yes Banding Machine $ 153.00
H-2
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
ROLL TYPE ASSET YEAR NEW PROP. DESCRIPTION MODEL # SERIAL # ACQ.COST PC
LIFE ACQ.
---------------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------------
U Mobile A 1997 yes Used Conveyors (6) $ 39,000.00
U Fixed A 1997 yes Wet/Dry Vacuum $ 182.00
U Fixed A 1997 yes Lab Equipment $ 335.00
U Fixed A 1997 yes Lab Equipment $ 997.00
U Fixed A 1997 yes Lab Equipment $ 2,258.00
U Fixed A 1997 yes Case 1845C Loader $ 26,210.00
U Fixed A 1997 yes Tool Box $ 279.00
U Fixed A 1997 yes Extication Device $ 153.00
U Fixed A 1997 yes Safety Supplies / Emergency ESCA $ 674.00
U Fixed A 1997 yes Trailer ▇▇▇▇ $ 63.00
U Fixed A 1997 yes A-Frame Coupling $ 30.00
U Fixed A 1997 yes Bed Liner $ 357.00
U Fixed A 1997 yes Bed Liner $ 317.00
U Fixed A 1997 yes Safety Supplies $ 487.00
U Fixed A 1997 yes Bed Liner $ 320.00
U Fixed A 1997 yes Slide Projector $ 388.00
U Fixed A 1997 yes Bed Liner $ 320.00
U Fixed A 1997 yes Cross the bed tool box $ 279.00
U Fixed A 1997 yes Truck-down payment $ 5,000.00
U Fixed A 1997 yes Truck-down payment $ 5,000.00
U Fixed A 1997 yes 4wd Ambulance $ 4,250.00
U Fixed A 1997 yes 2wd Ambulance $ 3,000.00
U Fixed A 1997 yes Tool Box $ 262.00
U Fixed A 1997 yes Lug Wrench $ 10.00
U Fixed A 1997 yes ▇▇▇▇▇ $ ▇▇▇▇▇ Survey Equipment $ 216.00
U Fixed A 1997 yes Lab Equipment $ 229.00
U Fixed A 1997 yes Cross the bed tool box $ 262.00
U Fixed A 1997 yes Precision Instrument $ 230.00
U Fixed A 1997 yes Columbine Welder $ 5,764.00
U Fixed A 1997 yes 10 Foot Farm Disc $ 1,000.00
U Fixed A 1995 Fast Track Upgrade $ 98.00
U Fixed A 1995 Data Vac/2 Vacuum $ 135.00
U Fixed A 1996 Autocad-R13 $ 3,197.00
U Fixed A 1996 Computer Communication Snap Kit $ 222.00
U Fixed A 1996 HP 750 C ink Jet $ 7,369.00
Plotter
U Fixed A 1996 Gateway 2000 Computer $ 4,487.00
U Fixed A 1996 21' Vivitron Monitor $ 1,745.00
U Fixed A 1997 yes Computer Plc $ 221,398.00
U Fixed A 1997 Gateway 2000 Computer $ 3,329.00
U Fixed A 1997 yes Calculators $ 34.00
U Fixed A 1997 yes ▇▇▇▇▇▇▇ ▇▇▇▇▇ Computer Printer $ 776.00
H-3
SCHEDULE "I"
LITIGATION
LITIGANT\PARTY RELATING TO NATURE OF LITIGATION\CLAIM
-------------- ----------- --------------------------
▇.▇. ▇▇▇▇▇▇▇▇ & Open Pit Mining Contract Claim against Mineral Ridge
Sons, Inc. in the amount of
$1,466,746.90.
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ Mineral Ridge Project Claim against Mineral Ridge
Construction Contract in the amount of
$637,054.25.
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Dismissal as Employee of Claim against Mineral Ridge
Mineral Ridge for employment
discrimination before Nevada
Equal Rights Commission and
the United States Equal
Employment Opportunity
Commission demanding back
pay of $38,000 and punitive
damages of $50,000.
Van American Reclamation Bonding Failure by Mineral Ridge to
make payment which was
requested April 24, 1998 in
the amount of $719,700 under
the General Contract of
Indemnity, Section 2(b).
▇.▇. ▇▇▇▇▇ & Long outstanding In respect of litigation in
Associates, Inc. litigation regarding. the Fifth Judicial District
Court for the State of
Nevada captioned ▇.▇. ▇▇▇▇▇
& ASSOCIATES, INC. V.
SUNSHINE PRECIOUS METALS,
INC., SUNSHINE MINING
COMPANY AND HOMESTEAD
MINERALS, INC.
▇▇▇▇ ▇▇▇▇▇\Barium, Ivanhoe Joint Venture - Threatened litigation
Inc. disclosure of information against CRL. Considered
spurious but CRL is advising
its insurer.
I-1
SCHEDULE "J"
EMPLOYMENT CONTRACTS
▇▇▇ ▇▇▇▇▇▇▇
Letter of appointment dated April 11, 1996 and subsequent confirmation letter of
September 14, 1998 dictates annual salary of $95,000 and severance the event of
a sale of Mineral Ridge or in the event of the position becoming redundant or
diminished due to a merger or takeover. Severance would consist of six months
salary, equivalent to $47,500 and six months continuance of medical and dental
coverage.
▇▇▇▇▇▇▇ ▇▇▇
Salary of ▇▇▇▇▇▇▇ ▇▇▇ is $65,000 annually. Letter dated September 14, 1998 for
confirmation of terms should termination occur as a result of the sale of
Mineral Ridge. Severance consisting of three months salary, equivalent to
$16,250 is payable under such terms. Additionally, medical and dental coverages
would continue for three months, if required.
J-1
SCHEDULE "K"
INSURANCE
POLICY NO.: 3527 - 34 - 66
INSURER: Federal Insurance Company as arranged by Chubb Insurance
Company
COVERAGE: PROPERTY INSURANCE
LIMITS: $10,547,877 on Real and Personal Property
$ 890,000 on Mobile Equipment
$ 597,371 on Heap ▇▇▇▇▇ Pad
SUB-LIMITS: $ 5,000,000 on Earthquake
$ 100,000 on Extra Expense
PERILS INSURED: "All Risks" of Direct Physical Loss or Damage including
Flood and Earthquake Perils
DEDUCTIBLES: $ 50,000 Each and Every Loss except
$ 100,000 On Flood
5% on Earthquake (minimum $250,000)
VALUATION: Replacement Cost except Actual Cash Value on mobile equipment
over 3 years old and Special Valuation on Heap ▇▇▇▇▇
EFFECTIVE: June 30, 1998 to June 30, 1999
POLICY NO.: 7322 - 62 - 11
INSURER: Federal Insurance Company as arranged by Chubb Insurance
Company
COVERAGE: COMMERCIAL GENERAL LIABILITY INSURANCE
LIMITS: $1,000,000 Each Accident or Occurrence
$1,000,000 General Aggregate
$1,000,000 Products & Completed Operations
$1,000,000 Advertising/Personal Injury
$1,000,000 Fire Damage
$1,000,000 Employee Benefits Administrative Errors & Omissions
Liability Insurance
$1,000,000 Stop-gap Employers' Liability
$ 25,000 Medical Expenses
DEDUCTIBLES: $ 5,000 Per Occurrence, Bodily Injury and Property Damage
$ 5,000 Per Claim on Empl Ben E&O Insurance
5% on Earthquake (minimum $250,000)
EFFECTIVE: June 30, 1998 to June 30, 1999
K-1
POLICY NO.: 7838 - 71 - 80
INSURER: Chubb Insurance Company of Canada
COVERAGE: UMBRELLA LIABILITY INSURANCE
LIMITS: $3,000,000 Each Accident or Occurrence with respect to Bodily
Injury or Property Damage and in the Aggregate (where
applicable) in Excess of underlying $1,000,000 Commercial
General Liability Insurance
DEDUCTIBLES: NIL
EFFECTIVE: June 30, 1998 to June 30, 1999
-------------------------------------------------------------------------------
K-2
SCHEDULE "L"
PERMITTED ENCUMBRANCES
TYPE OF
ENCUMBERING PARTY OBLIGATION SECURED SPECIFICS OF ENCUMBRANCE
----------------- ------------------ ------------------------
Dresdner Bank Mine Debt Financing Deed of Trust, (UCC) Financing
Facility, Gold Note, Statements and Supplemental Deed
Dollar Note, Letter of Trust
of Credit, Hedging
Agreement Collateral Assignment of Material
Project Agreements
Collateral Assignment of Accounts
Pledge of Purchased Shares
▇.▇. ▇▇▇▇▇▇▇▇ & Open Pit Mining Lien filed against title to the
Sons, Inc. Contract Mineral Ridge property in the
amount of $1,466,746.90 in the
Office of the County Recorder of
▇▇▇▇▇▇▇▇▇ County, Nevada.
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Mineral Ridge Lien filed against title to the
Company Project Construction Mineral Ridge property in the
Contract amount of $637,054.25 in the
Office of the County Recorder of
▇▇▇▇▇▇▇▇▇ County, Nevada.
▇▇▇▇ Mining Company Royalty Agreement Deed of Trust with Power of Sale,
Assignment of Production, Security
Agreement, Financing Statement and
Fixtures Filing. See also
Schedule "G". In addition,
Mineral Ridge has failed to make
payment in the amount of $60,000
due July 21, 1998 for advance
royalty.
BenguetCorp. USA, Royalty Agreement See the ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ claims
Inc. in Schedule "G".
▇.▇. ▇▇▇▇▇ & Litigation Lien filed against title to the
Associates, Inc. Mineral Ridge property, recorded
in the Office of the County
Recorder of ▇▇▇▇▇▇▇▇▇ County,
Nevada in respect of litigation in
the Fifth Judicial District Court
for the State of Nevada captioned
▇.▇. ▇▇▇▇▇ & ASSOCIATES, INC. V.
SUNSHINE PRECIOUS METALS, INC.,
SUNSHINE MINING COMPANY AND
HOMESTEAD MINERALS, INC.
- - Hold periods and transfer
restrictions applicable to the
Purchased Shares under Canadian
and United States securities
legislation, the constating
documents of Mineral Ridge and the
various loan documents between
Dresdner and CRL or CRI
L-1
SCHEDULE "M"
APPROVALS
AUTHORITY OR PARTY TYPE OF APPROVAL
------------------ ----------------
The Toronto Stock Approval of the transfer of the Purchased Shares to
Exchange VGC and of the private placement of the CRL Shares.
Various Nevada Approval of change of beneficial holder of various
authorities permits for the Mineral Ridge mine.
M-1
SCHEDULE "N"
SUBSCRIPTION AGREEMENT
THE SECURITIES THAT ARE THE SUBJECT OF THIS AGREEMENT HAVE NOT BEEN AND WILL
NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933 AND, SUBJECT
TO CERTAIN EXCEPTIONS, MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES OR TO
A U.S. PERSON.
THIS AGREEMENT is dated the 21st day of October, 1998,
BETWEEN:
VISTA GOLD CORP., a company continued under the laws of
the Yukon Territory having an address at
▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇.▇.▇., ▇▇▇▇▇
(hereinafter referred to as the "Purchaser")
AND:
CORNUCOPIA RESOURCES LTD., a company amalgamated under
the laws of the Province of British Columbia, having an
address at ▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇
(hereinafter referred to as the "Company").
In consideration of the mutual covenants herein contained and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties to this Agreement hereby agree as follows:
1. SUBSCRIPTION
On the Closing (as hereinafter defined), the Purchaser shall purchase from the
Company and the Company shall issue and deliver to the Purchaser the Shares (as
hereinafter defined) of the Company for the price of U.S. $0.09 per share, being
an aggregate consideration of U.S. $250,000, on the terms and conditions set out
in this agreement.
N-1
2. DEFINITIONS
In this Agreement, unless the context otherwise requires:
(a) "Accredited Investor" means an "accredited investor" as that term is
defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the U.S.
Securities Act;
(b) "Closing" means:
(i) the completion of the acquisition of all of the outstanding
shares of Mineral Ridge Resources Inc. by Vista Gold Holdings
Inc. from the Company in accordance with the terms of the share
purchase and sale agreement made October 21, 1998 between the
Purchaser and the Company, amongst others; and
(ii) the completion of the issue and sale by the Company and the purchase
by the Purchaser of the Shares pursuant to this Agreement;
(c) "Closing Date" means October 21, 1998 or such other date as the Company and
the Purchaser may agree;
(d) "material" means material in relation to the Company and its subsidiaries
considered on a consolidated basis;
(e) "material change" means any change in the business, operations, assets,
ownership or capital of the Company and its subsidiaries, considered on a
consolidated basis that would reasonably be expected to have a significant
effect on the market price or value of the Shares and includes a decision
to implement such a change made by the board of directors of the Company or
by senior management of the Company who believe that confirmation of the
decision by the board of directors is probable;
(f) "material fact" means any fact as to which there is a substantial
likelihood that a reasonable investor would attach importance or that
significantly affects or would reasonably be expected to have a significant
effect on the market price or value of the Shares;
(g) "misrepresentation" means:
(i) an untrue statement of a material fact, or
(ii) an omission to state a material fact that is:
(1) required to be stated, or
(2) necessary to prevent a statement that is made from being false
or misleading in the circumstances in which it was made;
N-2
(h) "Private Placement Questionnaire and Undertaking" means the questionnaire
and undertaking required by the Stock Exchange in the form of Appendix "B"
hereto;
(i) "Purchaser" means Vista Gold Corp.;
(j) "Regulation S" means Regulation S under the U.S. Securities Act;
(k) "Securities Commission" means the British Columbia Securities Commission;
(l) "Securities Laws" means the applicable securities laws of the Province of
British Columbia and the respective regulations made and forms prescribed
thereunder together with all applicable published policy statements and
blanket orders and rulings of the Securities Commission;
(m) "Shares" means the 2,777,777 Shares to be allotted and issued by the
Company to the Purchaser at the Closing;
(n) "Stock Exchange" means The Toronto Stock Exchange;
(o) "U.S. Exchange Act" means the SECURITIES EXCHANGE ACT OF 1934, as amended,
of the United States of America;
(p) "U.S. Person" means a U.S. person as that term is defined in Regulation S;
(q) "U.S. Securities Act" means the SECURITIES ACT OF 1933 of the United States
of America; and
(q) "U.S. Securities Laws" means the U.S. Securities Act, the U.S. Exchange
Act, the securities laws of each applicable state of the United States and
the regulations promulgated under each such act or law.
3. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE COMPANY
The Company represents and warrants to the Purchaser, as representations and
warranties that are true as of the date of this agreement and as of the Closing
Date and covenants and agrees with the Purchaser as follows:
(a) the Company is duly incorporated, validly existing and in good standing
under the laws of the Province of British Columbia and is duly qualified to
transact business and is in good standing in every jurisdiction in which
the failure so to qualify would have a material adverse effect on its
business or properties;
(b) at their time of issue, the Shares will be free and clear of any liens or
encumbrances other than those created by, or imposed upon, the holders
thereof through no action of the Company;
N-3
(c) the following disclosure documents of the Company:
(i) the audited annual financial statements for the year ended December
31, 1997;
(ii) the management information circular dated as of April 9, 1998 for
the Company's 1998 annual general meeting;
(iii) all press releases issued by the Company after December 31, 1997;
(iv) the Form 10-K of the Company dated March 30, 1998; and
(v) the quarterly reports to shareholders on Form 10-Q on the interim
financial periods ended March 31, 1998 and June 30, 1998;
were, at their respective dates of issue or publication, true and correct
in all material respects, contained no misrepresentations and were prepared
in accordance with generally accepted accounting principles applicable in
Canada and complied with the laws, regulations, policy statements and rules
applicable thereto;
(d) the authorized capital of the Company consists of 300,000,000 shares
divided into 200,000,000 common shares without par value and 100,000,000
preferred shares without par value, issuable in series, of which 38,814,057
common shares are issued and outstanding on the date hereof as fully paid
and non-assessable shares;
(e) the common shares in the capital of the Company are listed and posted for
trading on the Stock Exchange;
(f) the Company is a reporting issuer under the Securities Act of British
Columbia, and is in compliance with its obligations thereunder; and
(g) the execution and delivery of this agreement, the fulfillment of the terms
hereof and the issue, sale and delivery on the Closing Date of the Shares,
do not and will not result in a breach of and do not create a state of
facts which, after notice or lapse of time, or both, will result in a
breach of, and do not and will not conflict with, any of the terms,
conditions or provisions of the constating documents of the Company or any
trust indenture, agreement or instrument to which the Company is a party or
by which the Company is contractually bound or will be contractually bound
on the Closing Date.
4. COVENANTS OF THE COMPANY
The Company covenants and agrees with the Purchaser as follows:
(a) the Company will use its best efforts to obtain the consent of the Stock
Exchange and comply with all other regulatory requirements, requirements of
the Stock Exchange and requirements of the Securities Laws and U.S.
Securities Laws applicable to the offering and sale of Shares to the
Purchaser on a "private placement" basis as contemplated hereby prior to
the Closing Date;
N-4
(b) the Company will use its best efforts to ensure that the Shares will
be listed and posted for trading on the Stock Exchange; and
(c) the Company shall deliver to the Purchaser on the Closing an opinion, dated
as of the Closing Date, of counsel to the Company, addressed to the
Purchaser and Purchaser's counsel with respect to the following matters:
(i) the Company has been duly incorporated and is a validly existing
company, is in good standing with respect to the filing of
returns, and is duly qualified to carry on business and own
property under the laws of its jurisdiction of incorporation and
the laws of any other jurisdictions in which it carries on
business or owns property;
(ii) the Company has all necessary corporate power and authority to
own its assets and to carry on its business;
(iii) the authorized and issued share capital of the Company;
(iv) this Agreement has been duly authorized by all necessary
corporate action on the part of the Company, has been duly
executed and delivered by and on behalf of the Company and is
valid and legally binding upon the Company and is enforceable in
accordance with its terms, except as rights to indemnity and
waiver of contribution thereunder may be limited under applicable
law, and subject to bankruptcy, insolvency and other similar laws
of general application affecting the enforcement of creditors
rights and to the availability of equitable remedies being in the
discretion of a court of competent jurisdiction;
(v) the Shares have been duly and validly allotted and issued as
fully paid and non-assessable shares in the capital of the
Company;
(vi) the Shares have been conditionally approved for listing on the
Stock Exchange, subject to the filing of the required documents
within the time stipulated by the Stock Exchange;
(vii) the Company is a reporting issuer not in default under the
SECURITIES ACT (British Columbia);
(viii) no prospectus is required and, except as have been obtained or
completed, no approval or consent of or filing with any
governmental authority in the British Columbia or the Stock
Exchange is required in order to qualify the issuance and sale by
the Company of the Shares except for the filing within 10 days of
the Closing Date of reports in prescribed form prepared and
executed in accordance with applicable Securities Laws and except
as may be required by the Stock Exchange in connection with the
sale of the Shares; and
(ix) the hold periods and resale restrictions applicable to the Shares
under the Securities Laws.
N-5
5. PURCHASER'S REPRESENTATIONS, WARRANTIES AND COVENANTS
The Purchaser represents and warrants to the Company, as representations and
warranties that are true as of the date of this Agreement and as of the Closing
Date and covenants with the Company, that:
(a) the Purchaser is a valid and subsisting corporation, has the necessary
corporate capacity and authority to execute and deliver this agreement and
to observe and perform its covenants and obligations hereunder and has
taken all necessary corporate action in respect thereof, this agreement
creates a legal, valid and binding contract of the Purchaser enforceable
against the Purchaser in accordance with its terms;
(b) the Purchaser is purchasing the Shares as principal for its own account,
and not for the benefit of any other person, for investment only and not
with a view to resale or distribution;
(c) the offering and sale of the Shares to the Purchaser were not made through
an advertisement of the Shares in printed media of general and regular paid
circulation, radio or television or any other form of advertisement, and,
to its knowledge, the Purchaser has not received an offering memorandum as
such term is defined under the Securities Laws;
(d) the Shares are not being purchased by the Purchaser as a result of any
material information concerning the Company that has not been publicly
disclosed and the Purchaser's decision to enter into this agreement and
acquire the Shares has not been made as a result of any verbal or written
representation as to fact or otherwise made by or on behalf of the Company
or any other person and is based entirely upon currently available public
information concerning the Company;
(e) the Purchaser has such knowledge and experience in financial and business
affairs as to be capable of evaluating the merits and risks of the
investment hereunder in the Shares and is able to bear the economic risk of
loss of such investment;
(f) the Purchaser is not a "U.S. Person" as defined in Regulation S under the
U.S. Securities Act;
(g) the Purchaser has no intention to distribute either directly or indirectly
any of the Shares in the United States or to "U.S. Persons"; provided,
however, that the Purchaser may sell or otherwise dispose of any of the
Shares pursuant to registration thereof pursuant to the U.S. Securities Act
and any applicable State securities laws or under an exemption from such
registration requirements;
(h) the Purchaser understands that the Shares have not been and will not be
registered under the U.S. Securities Act and that the sale contemplated
hereby is being made in reliance on an exemption from such registration
requirement;
(i) the Purchaser is an Accredited Investor, being an organization described in
Section 501(c)(3) of the United States Internal Revenue Code, a
corporation, a Massachusetts or
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similar business trust or partnership, not formed for the specific
purpose of acquiring the Shares, with total assets in excess of
US$5,000,000;
(j) the Purchaser acknowledges that it has not purchased the Shares as a result
of any form of general solicitation or general advertising including
advertisements, articles, notices or other communications published in any
newspaper, magazine or similar media or broadcast over radio, or
television, or any seminar or meeting whose attendees have been invited by
general solicitation or general advertising;
(k) the Purchaser agrees that if it decides to offer, sell or otherwise
transfer any of the Shares, it will not offer, sell or otherwise transfer
any of such Shares directly or indirectly, unless:
(i) the sale is to the Company;
(ii) the sale is made outside the United States in a transaction
meeting the requirements of Rule 904 of Regulation S and in
compliance with applicable local laws and regulations;
(iii) the sale is made pursuant to the exemption from the registration
requirements under the U.S. Securities Act provided by Rule 144
thereunder and in accordance with any applicable state securities
or "Blue Sky" laws; or
(iv) the Shares are sold in a transaction that does not require
registration under the U.S. Securities Act or any applicable U.S.
state laws and regulations governing the offer and sale of
securities, and it has prior to such sale furnished to the
Company an opinion reasonably satisfactory to the Company;
(l) the Purchaser acknowledges that it has not purchased the Shares as a result
of, and will not itself engage in, any "directed selling efforts" (as
defined in Regulation S) in the United States in respect of the Shares
which would include any activities undertaken for the purpose of, or that
could reasonably be expected to have the effect of, conditioning the market
in the United States for the resale of the Shares; provided, however, that
the Purchaser may sell or otherwise dispose of any of the Shares pursuant
to registration of the Shares pursuant to the U.S. Securities Act and any
applicable state securities laws or under an exemption from such
registration requirements and as otherwise provided herein;
(m) the office of the Purchaser at which the Purchaser received and accepted
the offer to purchase the Shares is the address listed on the signature
page of this Subscription Agreement;
(n) The Purchaser acknowledges that if it decides to offer, sell or otherwise
transfer any of the Shares in Canada, such securities may be offered or
sold or otherwise transferred only:
(i) pursuant to an exemption from the registration and prospectus
requirements under the Securities Laws or the securities legislation
of the Province of Canada in
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which such trade is occurring, and with the prior consent of the
Stock Exchange; or
(ii) if the trade is made in British Columbia, 12 months have elapsed
from the date of the issue of the Shares, and at that time the
Purchaser is not a control person of the Company, no unusual
effort is made to prepare the market or create a demand for the
Shares and no extraordinary commission or other consideration is
paid in respect of such offer, sale or transfer;
(o) the Purchaser acknowledges that:
(a) the Company has provided notice to them that, pursuant to the
SECURITIES ACT (British Columbia), the Shares will be subject to
a hold period which will prevent the Shares from being traded in
the Province of British Columbia for a period of 12 months after
the date of issuance of the Shares; and
(b) the Company has provided it notice that, within 10 days of the
initial trade in the Shares made by the Purchaser, the Purchaser
must file with the Securities Commission a report, in the form
required by Blanket Order and Ruling #95/17 of the Securities
Commission;
(p) the Purchaser acknowledges that all certificates issued representing the
Shares, as well as all certificates issued in exchange for or in
substitution therefore, will bear legends to the following effect:
"THE COMMON SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF
1933, AS AMENDED (THE "1933 ACT"). THE HOLDER HEREOF, BY
PURCHASING SUCH SECURITIES, AGREES FOR THE BENEFIT OF THE
COMPANY THAT SUCH SECURITIES MAY BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED ONLY (A) TO THE COMPANY; (B) OUTSIDE
THE UNITED STATES IN ACCORDANCE WITH RULE 904 OF REGULATION
S UNDER THE 1933 ACT; OR (C) WITHIN THE UNITED STATES IN
ACCORDANCE WITH THE EXEMPTION FROM REGISTRATION UNDER THE
1933 ACT PROVIDED BY RULE 144 THEREUNDER, IF APPLICABLE, AND
IN COMPLIANCE WITH ANY APPLICABLE STATE SECURITIES LAWS.
DELIVERY OF THIS CERTIFICATE MAY NOT CONSTITUTE GOOD
DELIVERY IN SETTLEMENT OF TRANSACTIONS ON STOCK EXCHANGES IN
CANADA. A NEW CERTIFICATE, NOT BEARING THIS LEGEND, MAY BE
OBTAINED FROM THE COMPANY'S REGISTRAR AND TRANSFER AGENT,
UPON DELIVERY OF THIS CERTIFICATE AND EITHER A DULY EXECUTED
DECLARATION, IN A FORM SATISFACTORY TO SUCH REGISTRAR AND
TRANSFER AGENT AND THE COMPANY, TO THE EFFECT THAT SUCH SALE
IS BEING MADE IN ACCORDANCE WITH RULE 904 OF REGULATION S
UNDER THE 1933 ACT OR AN OPINION OF COUNSEL SATISFACTORY TO
THE COMPANY TO THE EFFECT THAT SUCH SALE IS EXEMPT FROM
REGISTRATION UNDER THE 1933 ACT.";
and
(q) the Purchaser understands and acknowledges that the Company, at its option,
may not record a transfer without first being satisfied that such transfer
is exempt from or not
N-8
subject to registration under the U.S. Securities Act or the securities
laws of any state of the United States or is exempt from or not subject
to the registration and prospectus requirements under the Securities
Laws or the securities legislation of the Province of Canada in which
such transfer is occurring.
6. CONDITIONS OF CLOSING
The obligations of the Purchaser to complete the purchase of the Shares is
subject to the satisfaction on or before the Closing, for the exclusive benefit
of the Purchaser, of each of the following conditions:
(a) the representations and warranties of the Company in Section 3 of this
Agreement shall be true and correct in all material respects as at the
Closing with the same force and effect as if such representations and
warranties had been made at and as of the Closing;
(b) the Company shall have, in all material respects, performed and complied
with all covenants and agreements in this Agreement to be performed or
complied with, or caused to be performed or complied with, by the Company
at or prior to the Closing;
(c) the Company shall have made all necessary filings and obtained all
necessary shareholder and regulatory approvals, consents, authorizations
and acceptances required to be made or obtained in respect of the offering
of the Shares;
(d) the Stock Exchange shall have accepted notice of the offering and sale of
the Shares on the terms contemplated herein and shall have conditionally
approved the listing of the Shares, subject to the Company fulfilling the
requirements as to the filing of certain documents and the payment of the
necessary listing fees;
(e) the Purchaser shall have completed the acquisition of all of the
outstanding shares of Mineral Ridge Resources Inc. from Cornucopia
Resources Inc. in accordance with the terms of the share purchase and sale
agreement made October 21, 1998 among Cornucopia Resources Inc., the
Company, Vista Gold Holdings Inc. and the Purchaser;
(f) since June 30, 1998, there shall have been no adverse material change
(actual, anticipated, contemplated or threatened, whether financial or
otherwise) in the business, affairs, operations, assets, liabilities
(contingent or otherwise) or capital of the Company and its subsidiaries,
except as disclosed to and accepted by the Purchaser;
(g) no transaction shall have been entered into by the Company or any of its
subsidiaries which is or would be material to the Company and its
subsidiaries which is or would be material to the Company and its
subsidiaries on a consolidated basis, except as disclosed to and accepted
by the Purchaser;
(h) a certificate or certificates representing the Shares, in form and
substance satisfactory to the Purchaser and its counsel acting reasonably,
shall have been executed and delivered to the Purchaser;
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(i) the Purchaser shall have completed a due diligence review satisfactory to
the Purchaser in its sole discretion, acting reasonably, of the financial
condition, business, affairs, properties and assets of the Company; and
(j) the Purchaser shall have received a certificate, dated as of the Closing
Date, signed by the President and the Chief Financial Officer of the
Company or any other officers of the Company acceptable to the Purchaser,
certifying for and on behalf of the Company, to the best of their
knowledge, information and belief, that:
(i) the representations and warranties of the Company in Section 3 of
this Agreement are true and correct in all material respects as
at the Closing;
(ii) the Company has, in all material respects, performed and complied
with all covenants and agreements in this Agreement to be
performed or complied with, or caused to be performed or complied
with, by the Company at or prior to the Closing;
(iii) the Company has made all necessary filings and obtained all
necessary shareholder and regulatory approvals, consents,
authorizations and acceptances required to be made or obtained in
respect of the offering of the Shares;
(iv) since June 30, 1998, there has been no adverse material change
(actual, anticipated, contemplated or threatened, whether
financial or otherwise) in the business, affairs, operations,
assets, liabilities (contingent or otherwise) or capital of the
Company and its subsidiaries; and
(v) no transaction has been entered into by the Company or any of its
subsidiaries which is or would be material to the Company and its
subsidiaries on a consolidated basis.
7. CLOSING
At the Closing on the Closing Date, the Purchaser shall deliver to the Company a
certified cheque for U.S. $250,000 and the Company shall deliver to the
Purchaser a certificate or certificates representing the Shares registered in
the name of the Purchaser or its nominee.
8. INFORMATION AND DOCUMENTS
The Purchaser will deliver to the Company along with this Agreement a copy of
the Registration Instructions attached hereto as Schedule A and a completed and
originally executed copy of the Private Placement Questionnaire and Undertaking
and will, promptly upon request by the Company, provide the Company with such
information and execute and deliver to the Company such additional undertakings,
questionnaires and other documents as the Company may reasonably request in
connection with the issue and sale of the Shares. The Purchaser acknowledges
and agrees that such undertakings, questionnaires and other documents, when
executed and delivered by the Purchaser, will form part of and will be
incorporated into this Agreement with the same effect as if each constituted a
representation and warranty or covenant
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of the Purchaser hereunder in favour of the Company. The Purchaser consents
to the filing of such undertakings, questionnaires and other documents as may
be required to be filed with any stock exchange or securities regulatory
authority in connection with the transactions contemplated hereby.
9. RESALE RESTRICTIONS
The Purchaser understands and acknowledges that the Shares will be subject to
certain resale restrictions under the Securities Laws, U.S. Securities Laws
and the Private Placement Questionnaire and Undertaking and the Purchaser
agrees to comply with such restrictions. The Purchaser also acknowledges
that it has been advised to consult its own legal advisors with respect to
applicable resale restrictions and that it is solely responsible (and the
Company is not in any manner responsible) for complying with such
restrictions.
10. MODIFICATION
Neither this Agreement nor any provision hereof shall be modified, changed,
discharged or terminated except by an instrument in writing signed by the party
against whom any waiver, change, discharge or termination is sought.
11. ASSIGNMENT
This Agreement and any interest herein or any of the rights arising hereunder
may not be assigned without the prior written consent of the other party to this
Agreement.
12. MISCELLANEOUS
The Agreement contains the whole agreement between the Company and the Purchaser
in respect of the subject matters hereof and there are no warranties,
representations, terms, conditions or collateral agreements, express, implied or
statutory, other than as expressly set forth herein and in any amendments
hereto. All representations, warranties, agreements and covenants made or
deemed to be made by the Purchaser herein will survive the execution and
delivery, and acceptance, of this offer and the Closing. Time shall be of the
essence of this Agreement. This Agreement and the rights and obligations of the
parties hereunder will be governed by and construed according to the laws of the
Province of British Columbia. This Agreement may be executed in any number of
counterparts, each of which when delivered, either in original or facsimile
form, shall be deemed to be an original and all of which together shall
constitute one and the same document.
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IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the day
and year first above written.
VISTA GOLD CORP.
Per:
___________________________________
Authorized Signatory
CORNUCOPIA RESOURCES LTD.
Per:
___________________________________
Authorized Signatory
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APPENDIX "A"
REGISTRATION INSTRUCTIONS
(PURCHASER TO COMPLETE)
Please prepare the Share Certificate to be issued pursuant to the attached
agreement registered in the following name and address:
VISTA GOLD CORP.
-----------------------------------
Name
▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------
Address
DENVER, COLORADO
-----------------------------------
80202
-----------------------------------
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APPENDIX "B"
THE TORONTO STOCK EXCHANGE
PRIVATE PLACEMENT QUESTIONNAIRE AND UNDERTAKING
To be completed by each proposed private placement purchaser of listed
securities or securities which are convertible into listed securities.
QUESTIONNAIRE
1. DESCRIPTION OF TRANSACTION
(a) Name of Issuer of the Securities: Cornucopia Resources Ltd.
----------------------------------
(b) Number and Description of Securities to be Purchased:
2,777,777 common shares without par value
---------------------------------------------------------------------
(c) Purchase Price: U.S. $250,000 (CDN. $390,700)
----------------------------------------------------
2. DETAILS OF PURCHASER
(a) Name of Purchaser: Vista Gold Corp.
-------------------------------------------------
(b) Address: ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇
-----------------------------------------------------------
(c) Names and addresses of persons having a greater than 10% beneficial
interest in the Purchaser: None
-----------------------------------------
3. RELATIONSHIP TO ISSUER
(a) Is the purchaser (or any person named in response to 2(c) above) an
insider of the issuer for the purposes of the Ontario Securities Act
(before giving effect to this private placement)? If so, state the
capacity in which the purchaser (or person named in response to 2(c))
qualifies as an insider.
No
---------------------------------------------------------------------
---------------------------------------------------------------------
(b) If the answer to (a) is "no", are the purchaser and the issuer
controlled by the same person or company? If so give details.
No
---------------------------------------------------------------------
---------------------------------------------------------------------
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4. DEALINGS OF PURCHASER IN SECURITIES OF THE ISSUER
Give details of all trading by the purchaser, as principal, in the
securities of the issuer (other than debt securities which are not
convertible into equity securities), directly or indirectly, within the 60
days preceding the date hereof.
None
--------------------------------------------------------------------------
--------------------------------------------------------------------------
--------------------------------------------------------------------------
UNDERTAKING
TO: THE TORONTO STOCK EXCHANGE
The undersigned has subscribed for and agreed to purchase, as principal, the
securities described in Item 1 of this Private Placement Questionnaire and
Undertaking.
The undersigned undertakes not to sell or otherwise dispose of any of the
said securities so purchased or any securities derived therefrom for a period
of six months from the date of the closing of the transaction herein or for
such period as is prescribed by applicable securities legislation, whichever
is longer, without the prior consent of The Toronto Stock Exchange and any
other regulatory body having jurisdiction.
DATED at Denver Colorado, this ______ day of October, 1998.
Vista Gold Corp.
---------------------------------------
(Name of Purchaser - PLEASE PRINT)
---------------------------------------
(Authorized Signature)
President and Chief Executive Officer
---------------------------------------
(Official Capacity - PLEASE PRINT)
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------------------
(PLEASE PRINT HERE NAME OF INDIVIDUAL
WHOSE SIGNATURE APPEARS ABOVE, IF
DIFFERENT FROM NAME OF PURCHASER PRINTED
ABOVE)
N-15