Exhibit 10.01
STOCK PURCHASE AGREEMENT
Dated August 12, 2010
by and between
NORTH AMERICAN GOLD AND MINERALS FUND
and
WESTERN DIVERSIFIED MINING RESOURCES, INC.
THIS STOCK PURCHASE AGREEMENT ("Agreement") dated August 11, 2010 is made
and entered into by and between NORTH AMERICAN GOLD & MINERALS FUND, a Nevada
corporation with its principal office located at ▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇, #▇▇▇▇, ▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ("Purchaser") and WESTERN DIVERSIFIED MINING RESOURCES, INC., a
Wyoming corporation with its principal office located at ▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
#▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇ ("Western" or "Seller.
WHEREAS, Western is the owner of 510,923,545 shares of common stock of
▇▇▇▇▇ Gold, Inc., representing 23.22% of the issued and outstanding shares of
this company (the "▇▇▇▇▇ Shares") and 1,030,421,001 shares of common stock of
South Copperstone, Inc., representing 46.84% of the issued and outstanding
shares of this company (the "South Copperstone Shares") (the "▇▇▇▇▇ Shares" and
the "South Copperstone Shares" being sometimes hereafter referred to as the
"Shares"); and
WHEREAS, Seller desires to sell, transfer and assign to Purchaser, and
Purchaser desires to purchase and acquire from Seller, all of the Shares on the
terms set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and promises set
forth in this Agreement, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
ARTICLE I
SALE OF SHARES AND CLOSING DATE
1.01 Shares. Subject to the terms and conditions hereinafter set forth,
Purchaser hereby agrees to purchase the Shares from Seller for the Purchase
Price (as defined below) and Seller agrees to sell the Shares to Purchaser for
the Purchase Price.
1.02 Purchase Price. (a) The purchase price for the ▇▇▇▇▇ Shares shall be
12,096,115 shares of Purchaser's Class A Preferred Stock, valued at $16.00 per
share (the liquidation preference), having the terms and conditions set forth in
Exhibit A hereto (the "Class A Shares"). This equates to US$193,537,839 or
US$0.3788 per share of common stock of ▇▇▇▇▇ Gold, Inc. The purchase price for
the South Copperstone Shares shall be 29,334,212 shares of Purchaser's Class B
Preferred Stock, valued at $2,20 per share (the liquidation preference) and
having the terms and conditions set forth in Exhibit B hereto share (the "Class
B Shares"). This equates to US$64,535,268 or US$0.06263 per share of common
stock of South Copperstone, Inc. (The "Class A Shares" and the "Class B Shares"
are sometimes referred to herein as the "Preferred Shares"). The Preferred
Shares will be delivered by Purchaser, and the Shares will be delivered by
Seller, at the Closing (as that term is defined in paragraph 1.03). The price
per Share set forth in this Section 1.02, which is a combined transaction value
of $258,073,107 or $0.003449 per share of common stock of Western's corporate
parent, is final and shall not be subject to adjustment based on future changes
in the price of gold.
(b) In addition, Purchaser will assume the loan accounts owed by ▇▇▇▇▇ Gold,
Inc. and by South Copperstone, Inc. as of the date of Closing.
1.03 Closing. The closing of the transaction contemplated herein
("Closing") shall take place on August 17, 2010 in the City of Las Vegas, or at
such other place as Purchaser and Seller mutually agree at the Closing. At
Closing, the following shall be delivered (the "Closing Documents"):
(a) Purchaser shall deliver to Seller:
(i) Stock Certificates representing the Preferred Shares pursuant to
Section 1.02(a) of this Agreement;
(ii) An instrument of assumption acceptable of loan account and loan
notes pursuant to Section 1.02(b): and
(iii)A secretary's certificate (or equivalent) certifying the
resolutions of the board of directors of Purchaser which, among
other things: (a) approve the execution and delivery of this
Agreement and the carrying out of the transactions contemplated
hereby; and (b) approve the purchase of the Shares.
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(b) Seller shall itself deliver to Purchaser (or cause Western to
deliver):
(i) Stock Certificate(s) representing the Shares together with stock
powers thereafter duly endorsed as directed by Purchaser;
(ii) A secretary's certificate (or equivalent) certifying the
resolutions of the board of directors of Seller which, among
other things: (a) approve the execution and delivery of this
Agreement and the carrying out of the transactions contemplated
hereby; and (b) approve the purchase of the Shares; and
(iii)An instrument reasonably acceptable to Purchaser pursuant to
which Searchlight Exploration, LLC agrees to the reduction of its
Net Profits Interest in both the ▇▇▇▇▇ and South Copperstone
Properties from 25% to 5%.
1.05 Further Assurances; Post-Closing Cooperation.
(a) Subject to the terms and conditions of this Agreement, at any time
or from time to time after the Closing, at Purchaser's request and without
further consideration, Seller shall execute and deliver to Purchaser within ten
(10) days following such request, as the case may be, such other instruments of
sale, transfer, conveyance, assignment and confirmation, provide such materials
and information and take such other actions as Purchaser may reasonably deem
necessary or desirable in order more effectively to transfer, convey and assign
to Purchaser, and to confirm Purchaser's title to, the Shares and otherwise to
cause Seller to fulfill its obligations under this Agreement.
(b) Following the Closing, each party will afford the other party, its
counsel and its accountants, during normal business hours, reasonable access to
the books, records and other data relating to its business in its possession
with respect to periods prior to the Closing and the right to make copies and
extracts therefrom, to the extent that such access may be reasonably required by
the requesting party in connection with (i) the preparation of tax returns, (ii)
the determination or enforcement of rights and obligations under this Agreement,
(iii) compliance with the requirements of any governmental or regulatory
authority, (iv) the determination or enforcement of the rights and obligations
of any party to this Agreement, or (v) in connection with any actual or
threatened action or proceeding. Further each party agrees for a period
extending six (6) years after the Closing not to destroy or otherwise dispose of
any such books, records and other data unless such party shall first offer in
writing to surrender such books, records and other data to the other party and
such other party shall not agree in writing to take possession thereof during
the ten (10) day period after such offer is made.
(c) If, in order properly to prepare its tax returns, other documents
or reports required to be filed with governmental or regulatory authorities or
its financial statements or to fulfill its obligations hereunder, it is
necessary that a party be furnished with additional information, documents or
records relating to its business not referred to in paragraph (b) above, and
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such information, documents or records are in the possession or control of the
other party, such other party shall use its best efforts to furnish or make
available such information, documents or records (or copies thereof) at the
recipient's request, cost and expense. Each party to this Agreement agrees to
keep such information confidential.
(d) It is anticipated that Purchaser will offer to purchase the
remaining shares of ▇▇▇▇▇ Gold Inc. and South Copperstone Inc. for Series A
Preferred Shares and Series B Preferred Shares at the same price per share that
is being paid pursuant to Section 1.02 in order to acquire a 100% ownership
interest in both companies. Seller will use its best efforts to assist in
obtaining the agreement of the other shareholders in these companies although it
cannot guaranty their acceptance of such an offer.
(e) It is anticipated that Western's corporate parent will distribute
the Preferred Shares to its shareholders, and will initiate all necessary
corporate action with FINRA and the DTCC to set a "record date" and "pay date"
upon the execution and delivery of this Agreement. Purchaser will cooperate in
good faith in the efforts of Western's corporate parent to complete this
distribution. Assuming that Western's corporate parent has 74,813,049,643 shares
of common stock issued and outstanding, this would be a distribution of
0.00016168455 shares (rounded up) of Purchaser's Series A Preferred Stock per 1
(One) share of common stock of Western's corporate parent, and 0.0003921002
shares (rounded up) of Purchaser's Series B Preferred Stock per 1 (One) share of
common stock of Western's corporate parent, or a total value of US$0.003449 per
share of the common stock of Western's corporate parent.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to Purchaser as follows:
2.01 Corporate Existence. Seller is a corporation validly existing and in
good standing under the laws of Wyoming, and has full corporate power and
authority to conduct its business and to the extent now conducted.
2.02 Ownership. Seller owns and is conveying to Purchaser all of its
rights, title and interests to the Shares, free and clear of all liens,
mortgages, pledges, security interests, encumbrances or charges of any kind or
description and upon consummation of the transaction contemplated herein good
title in the Shares shall vest in Purchaser free of all liens and other charges.
Seller represents that it owns all of the Shares in ▇▇▇▇▇ and in South
Copperstone.
2.03 No Conflicts. The execution and delivery of this Agreement, the
performance of its obligations hereunder, and the consummation of the
transaction contemplated hereby, including, without limitation, the sale of the
Shares to Purchaser, shall not conflict with or result in the breach of any term
or provision of, or violate or constitute a default under any other agreement to
which Seller is a party, or result in the creation of any lien on any of the
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Shares or Purchaser. This Agreement has been duly and validly executed and
delivered by Seller and constitutes, and upon the execution and delivery by
Seller of the Closing Documents to which it is a party, such Closing Documents
will constitute, legal, valid and binding obligations of Seller enforceable
against Seller in accordance with their terms.
2.04 Accuracy and Completeness of Due Diligence Documents. The documents
provided to Purchaser in response to Purchaser's due diligence requests,
completely and accurately portray the status of business of Seller as of the
Closing and do not include a material misstatement or omission of a material
fact which would reasonably likely to have a material adverse effect on Seller
or its business. Further, the information included in such responses shall be
incorporated herein as an affirmative representation and warranty on the part of
Seller.
2.05 Continuity of Business. Seller reasonably expects that the business
represented by the agreements found in Schedule 2.04 will continue after the
date hereof. Seller has no knowledge that any customer included in that Schedule
intend to terminate or reduce the amount of business they presently do with
Seller, and Seller has no knowledge of any state of facts which would lead it to
believe that any of such customers will terminate their relationship with Seller
or significantly reduce the amount of business they presently do with Seller.
2.06 Claims, Litigation, Disclosure. Except as set forth in Schedule 2.06
there is no claim, litigation, tax audit, proceeding or investigation pending or
threatened against Seller or its corporate parent with respect to its business,
nor is there a basis for any such claim, litigation, audit, proceeding or
investigation.
2.07 Taxes. Except as specifically set forth on Schedule 2.07 (the "Tax
Liabilities"), Seller has correctly prepared and timely filed all Federal, state
and local tax returns, estimates and reports, and paid all such taxes as and
when due. For purposes of this paragraph, taxes shall mean all taxes, charges,
fees, levies or other assessments of any kind whatsoever (including, without
limitation, income, franchise, sales, use and withholding taxes). On or before
the Closing Date, Seller shall pay off and satisfy any of the Tax Liabilities
which are then due and payable and provide Purchaser with evidence thereof in
form satisfactory to Purchaser and its counsel and have granted a reserve
adequate to pay any tax liabilities with respect to the operations of Seller
prior to the Closing.
ARTICLE III
REPRESENTATIONS, WARRANTIES AND COVENANTS OF PURCHASER
Purchaser hereby represents and warrants to Seller as follows:
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3.01 Corporate Existence. Purchaser is a corporation validly existing and
in good standing under the laws of the State of Nevada, and has full corporate
power and authority to conduct its business and to the extent now conducted.
3.02 Authority. The execution and delivery by Purchaser of this Agreement,
and the performance by Purchaser of its obligations hereunder and under the
Closing Documents, are duly and validly authorized by Purchaser. This Agreement
has been duly and validly executed and delivered by Purchaser and constitutes,
and upon the execution and delivery by Purchaser of the Closing Documents to
which it is a party, such Closing Documents will constitute, legal, valid and
binding obligations of Purchaser enforceable against Purchaser in accordance
with their terms.
3.03 No Conflicts. The execution and delivery by Purchaser of this
Agreement does not, and the execution and delivery by Purchaser of the Closing
Documents to which it is a party, the performance by Purchaser of its
obligations under this Agreement and such Closing Documents and the consummation
of the transactions contemplated hereby and thereby will not conflict with or
result in a violation or breach of any of the terms, conditions or provisions of
any agreement Purchaser is a party to.
3.04 Claims, Litigation, Disclosure. There is no claim, litigation, tax
audit, proceeding or investigation pending or threatened against Purchaser, with
respect to its business which would have a material effect on its ability to
satisfactorily perform its duties under this Agreement, nor is there a basis for
any such claim, litigation, audit, proceeding or investigation.
3.05 Taxes. The Purchaser has correctly prepared and timely filed all
Federal, state and local tax returns, estimates and reports, and paid all such
taxes as and when due. For purposes of this paragraph, taxes shall mean all
taxes, charges, fees, levies or other assessments of any kind whatsoever
(including, without limitation, income, franchise, sales, use and withholding
taxes).
ARTICLE IV
CONDITIONS TO OBLIGATIONS OF PURCHASER
The obligations of Purchaser hereunder to purchase the Shares are subject
to the fulfillment, at or before the Closing Date, of each of the following
conditions (all or any of which may be waived in whole or in part by Purchaser
in its sole discretion):
4.01 Representations and Warranties. The representations and warranties
made by Seller in this Agreement, taken as a whole, shall be true and correct,
in all respects material to the validity and enforceability of this Agreement
and the Closing Documents and to the condition of the business, on and as of the
Closing Date as though made on and as of the Closing or, in the case of
representations and warranties made as of a specified date earlier than the
Closing, on and as of such earlier date.
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4.02 Performance. Seller shall have performed and complied with, in all
material respects, the agreements, covenants and obligations required by this
Agreement to be so performed or complied with by Seller at or before the
Closing.
4.03 Officers' Certificates. Seller shall have delivered to Purchaser two
certificates of Seller each dated as of the Closing and executed in the name and
on behalf of Seller by the President of Seller, substantially in the form of
Schedule 4.03.1 annexed hereto, and a certificate executed by the Secretary or
any Assistant Secretary of Seller, substantially in the form of Schedule 4.03.2
annexed hereto.
4.04 Completion of Audit. Purchaser's independent registered accountant
shall have completed any necessary audit(s) required by said accountants to
continue Purchaser's SEC reporting in good standing following the Closing.
ARTICLE V
CONDITIONS TO OBLIGATIONS OF SELLER
The obligations of Seller hereunder to sell the Shares are subject to the
fulfillment, at or before the Closing, of each of the following conditions (all
or any of which may be waived in whole or in part by Seller in its sole
discretion):
5.01 Representations and Warranties. The representations and warranties
made by Purchaser in this Agreement, taken as a whole, shall be true and correct
in all material respects on and as of the Closing.
5.02 Performance. Purchaser shall have performed and complied with, in all
material respects, the agreements, covenants and obligations required by this
Agreement to be so performed or complied with by Purchaser at or before the
Closing.
ARTICLE VI
TERMINATION
6.01 Termination. This Agreement may be terminated, and the transactions
contemplated hereby may be abandoned:
(a) at any time before the Closing, by mutual written agreement of
Seller and Purchaser;
(b) at any time before the Closing, by Seller or Purchaser, in the
event that (i) any order or law becomes effective restraining, enjoining, or
otherwise prohibiting or making illegal the consummation of any of the
transactions contemplated by this Agreement or any of the Closing Documents or
(ii) there are any litigation or governmental, regulatory or self-regulatory
actions or investigations concerning Seller or Purchaser or their respective
officers or directors, upon notification of the non-terminating party by the
terminating party; or
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(c) by either party, in the event that the Closing does not occur on
or before August 31, 2010.
6.02 Effect of Termination. If this Agreement is validly terminated
pursuant to this Section, this Agreement will forthwith become null and void,
and there will be no liability or obligation on the part of Purchaser or Seller
(or any of their respective officers, directors, employees, agents or other
representatives or Affiliates, as the case may be).
ARTICLE VII
MISCELLANEOUS
7.01 Notices. All notices, requests and other communications hereunder must
be in writing and will be deemed to have been duly given only if delivered
personally or by facsimile transmission or mailed (first class postage prepaid)
to the parties at the following addresses or facsimile numbers:
If to Purchaser, to: North American Gold & Minerals Fund
▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇., #▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
If to Seller, to: Western Diversified Mining Resources, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, #▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇ Bezzano
All such notices, requests and other communications will (i) if delivered
personally to the address as provided in this Section, be deemed given upon
delivery, (ii) if delivered by facsimile transmission to the facsimile number as
provided in this Section, be deemed given upon receipt, and (iii) if delivered
by mail in the manner described above to the address as provided in this
Section, be deemed given upon receipt (in each case regardless of whether such
notice, request or other communication is received by any other Person to whom a
copy of such notice, request or other communication is to be delivered pursuant
to this Section). Any party from time to time may change its address, facsimile
number or other information for the purpose of notices to that party by giving
notice specifying such change to the other party hereto.
7.02 Entire Agreement. This Agreement and the Closing Documents supersede
all prior discussions and agreements between the parties with respect to the
subject matter hereof and thereof and contain the sole and entire agreement
between the parties hereto with respect to the subject matter hereof and
thereof.
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7.03 Expenses. Except as otherwise expressly provided in this Agreement
whether or not the transactions contemplated hereby are consummated, each party
will pay its own costs and expenses incurred in connection with the negotiation,
execution and closing of this Agreement and the Closing Documents and the
transactions contemplated hereby and thereby.
7.04 Waiver. Any term or condition of this Agreement may be waived at any
time by the party that is entitled to the benefit thereof, but no such waiver
shall be effective unless set forth in a written instrument duly executed by or
on behalf of the party waiving such term or condition. No waiver by any party of
any term or condition of this Agreement, in any one or more instances, shall be
deemed to be or construed as a waiver of the same or any other term or condition
of this Agreement on any future occasion. All remedies, either under this
Agreement or by law or otherwise afforded, will be cumulative and not
alternative.
7.05 Amendment. This Agreement may be amended, supplemented or modified
only by a written instrument duly executed by or on behalf of each party hereto.
7.06 No Assignment; Binding Effect. Purchaser may not assign its
obligations under this Agreement without the express written consent of Seller.
7.07 Headings. The headings used in this Agreement have been inserted for
convenience of reference only and do not define or limit the provisions hereof.
7.08 Invalid Provisions. If any provision of this Agreement is held to be
illegal, invalid or unenforceable under any present or future law, and if the
rights or obligations of any party hereto under this Agreement will not be
materially and adversely affected thereby, (a) such provision will be fully
severable, (b) this Agreement will be construed and enforced as if such illegal,
invalid or unenforceable provision had never comprised a part hereof and (c) the
remaining provisions of this Agreement will remain in full force and effect and
will not be affected by the illegal, invalid or unenforceable provision or by
its severance herefrom.
7.09 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Nevada applicable to a contract
executed and performed in such State, without giving effect to the conflicts of
laws principles thereof.
7.10 Counterparts. This Agreement may be executed in any number of
counterparts, each of which will be deemed an original, but all of which
together will constitute one and the same instrument.
7.11 Dispute Resolution. Any dispute hereunder shall be resolved by
arbitration in RENO, Nevada under the rules of the American Arbitration
Association and the decision of the arbitrator shall be final and binding on the
parties hereto. Any and all costs and expenses associated with actions taken
pursuant to this Paragraph 7.11 shall be borne by the non-prevailing party.
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IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by
the duly authorized officer of each party as of the date first above written.
NORTH AMERICAN GOLD & MINERALS FUND
as Purchaser
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: President
WESTERN DIVERSIFIED MINING RESOURCES, INC.
as Seller
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇ Bezzano
-----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇ Bezzano
Title: President
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EXHIBIT A
TERMS OF SERIES "A" PREFERRED SHARES
CERTIFICATE OF DESIGNATIONS, PREFERENCES AND RIGHTS OF SERIES "A" PREFERRED
STOCK OF NORTH AMERICAN GOLD & MINERALS FUND.
NORTH AMERICAN GOLD & MINERALS FUND (the "Company"), a corporation
organized and existing under and by virtue of the Revised Statutes of the State
of Nevada (the "NRS"), in accordance with Section 78.1955 of the NRS, DOES
HEREBY CERTIFY that:
The Amended and Restated Articles of Incorporation of the Company provide
that the Company is authorized to issue 1,000,000,000 shares of preferred stock,
par value $0.0001 per share. The Amended and Restated Articles of Incorporation
provide, further, that the Board of Directors is authorized, to the extent
permitted by law, to provide for the issuance of the shares of preferred stock
in series, and by filing a certificate pursuant to the NRS, to establish from
time to time the number of shares to be included in each series and to fix the
designation, powers, preferences and rights and the qualifications, limitations
or restrictions thereof. Pursuant to the authority conferred upon the Board of
Directors by the Amended and Restated Articles of Incorporation, the Board of
Directors, by Unanimous Written Consent dated August 11, 2010, adopted a
resolution providing for the designation, rights, powers and preferences and the
qualifications, limitations and restrictions of 52,085,000 shares of Series A
Preferred Stock, par value $0.0001 per share, and that a copy of such resolution
is as follows:
RESOLVED, that pursuant to the authority vested in the Board of Directors
of the Company, the provisions of its Amended and Restated Articles of
Incorporation, and in accordance with the NRS, the Board of Directors hereby
authorizes the filing of a Certificate of Designations, Preferences and Rights
of Series A Preferred Stock of North American Gold & Minerals Fund. Accordingly,
the Company's Series A Preferred Stock shall have the powers, preferences and
rights and the qualifications, limitations and restrictions thereof, as follows:
1. DESIGNATION AND NUMBER OF SHARES. Shares of the series shall be
designated and known as the Series A Preferred Stock of the Company. The Series
A Preferred Stock shall consist of 52,085,000 shares and have a par value of
$0.0001 per share. Shares of the Series A Preferred Stock (hereinafter referred
to as the "Series A Preferred Stock") which are retired, converted into shares
of the Company's common stock, purchased or otherwise acquired by the Company
shall be cancelled and shall revert to authorized but un-issued preferred stock,
undesignated as to series and subject to re-issuance by the Company as shares of
preferred stock of any one or more series.
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2. LIQUIDATION OF THE COMPANY OR SALE OF INVESTMENT IN SHARES OF ▇▇▇▇▇ GOLD
INC .
2.1 LIQUIDATION PREFERENCE. Upon (a) any liquidation, dissolution or
winding up of the Company, whether voluntary or involuntary, or (b) any sale by
the Company of all or substantially all of its investment in shares (the "▇▇▇▇▇
Shares") of common stock of ▇▇▇▇▇ Gold, Inc., a Wyoming corporation ("▇▇▇▇▇
Gold"), the holders of the shares of Series A Preferred Stock shall be senior in
rights to the holders of the Company's common stock as to proceeds of sale
(after deduction of the costs and expenses of sale and a 5% handling fee, the
"▇▇▇▇▇ Proceeds") of the Company's ▇▇▇▇▇ Shares and shall be entitled to be paid
a maximum amount equal to Sixteen Dollars ($16.00) per share (the " Liquidation
Preference") of the Series A Preferred Stock from said ▇▇▇▇▇ Proceeds. Such
amount payable with respect to one share of Series A Preferred Stock, as the
case may be, is sometimes referred to herein as the "▇▇▇▇▇ Liquidation Payment"
and, with respect to all shares of Series A Preferred Stock, as the "▇▇▇▇▇
Liquidation Payments".
2.2 If upon (a) such liquidation, dissolution or winding up of the Company,
whether voluntary or involuntary, or (b) such sale by the Company of all or
substantially all of its investment in the ▇▇▇▇▇ Shares, the ▇▇▇▇▇ Proceeds
shall be insufficient to permit payment to the holders of Series A Preferred
Stock of the full ▇▇▇▇▇ Liquidation Payments, then the entire ▇▇▇▇▇ Proceeds
shall be distributed ratably among the Series A Holders.
2.3 Upon (a) any such liquidation, dissolution or winding up of the Company
or (b) any such sale by the Company of all or substantially all of its
investment in the ▇▇▇▇▇ Shares, after the holders of Series A Preferred Stock
shall have been paid in full any ▇▇▇▇▇ Liquidation Payment to which they shall
be entitled as set forth in subparagraph 2.1 above, the remaining net assets of
the Company or ▇▇▇▇▇ Proceeds (to the extent that the Board of Directors
declares a dividend), as the case may be, shall be distributed to the holders of
common stock in proportion to the shares of common stock then held by them.
3. ▇▇▇▇▇ DIVIDEND PREFERENCE. To the extent that any dividends are declared
by the Board of Directors of the Company from current earnings of the Company
that are attributable to any dividends paid to the Company by ▇▇▇▇▇ Gold ("▇▇▇▇▇
Dividends") or ▇▇▇▇▇ Proceeds (after deduction of a 5% handling fee), shares of
Series A Preferred Stock shall be entitled to receive dividends at a fixed
annual rate of Three Percent (3%) of the Liquidation Preference,, payable solely
from said ▇▇▇▇▇ Dividends or ▇▇▇▇▇ Proceeds, before any ▇▇▇▇▇ Dividends are paid
by the Company on its common shares. Such dividends payable to the holders of
the Series A Preferred Stock shall not be cumulative. So long as any shares of
Series A Preferred Stock are outstanding, no dividend (other than a dividend in
common stock or in any other shares ranking junior to the Series A Preferred
Stock ) shall be declared or paid in any year from ▇▇▇▇▇ Dividends or ▇▇▇▇▇
Proceeds (other than from said 5% handling fee) unless, in each case, the full
dividend for said year on all outstanding shares of Series A Preferred Stock
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shall have been or contemporaneously are declared and paid from the ▇▇▇▇▇
Dividends or ▇▇▇▇▇ Proceeds.
4. NO VOTING RIGHTS. Except as may be required by law and as is provided in
this Certificate, no holder of outstanding shares of Series A Preferred Stock
shall be entitled to vote their shares of Series A Preferred Stock.
5. REDEMPTION. The shares of Series A Preferred Stock shall not be
redeemable prior to December 31, 2010. On and after January 1, 2011, the
Company, at its option, may redeem shares of Series A Preferred Stock, as a
whole or in part, for cash, at any time or from time to time, at a redemption
price of Sixteen Dollars (US$16.00) per share plus, in each case, any declared
and unpaid dividends thereon to the date fixed for redemption. In the event that
fewer than all of the outstanding shares of Series A Preferred Stock are to be
redeemed, the number of shares to be redeemed shall be determined by the Board
of Directors and the shares to be redeemed shall be determined by lot or pro
rata as may be determined by the Board of Directors or by any other method as
may be determined by the Board of Directors in its discretion to be equitable.
In the event the Company shall redeem shares of the Series A Preferred Stock,
notice of such redemption shall be given by first class mail, postage prepaid,
mailed not less than 30 nor more than 60 days prior to the redemption date, to
each holder of record of the shares to be redeemed, at such holder's address as
appears on the stock records of the Company, or by publishing notice thereof in
a newspaper of general circulation in ▇▇▇▇▇ County, Nevada. If the Company
elects to provide such notice by publication, it shall also promptly mail notice
of such redemption to each holder of the shares of Series A Preferred Stock to
be redeemed. Each such mailed or published notice shall state: (a) the
redemption date; (b) the number of shares of Series A Preferred Stock to be
redeemed and, if fewer than all the shares held by such holder are to be
redeemed, the number of such shares to be redeemed from such holder; (c) the
redemption price; (d) the place or places where certificates for such shares are
to be surrendered for payment of the redemption price; and (e) that dividends on
the shares to be redeemed will cease to accrue on such redemption date. No
defect in the notice of redemption or in the mailing thereof shall affect the
validity of the redemption proceedings, and the failure to give notice to any
holder of shares of the Series A Preferred Stock to be so redeemed shall not
affect the validity of the notice given to the other holders of shares of the
Series A Preferred Stock to be redeemed. Notice having been mailed or published
as aforesaid, then, notwithstanding that the certificates evidencing the shares
of the Series A Preferred Stock shall not have been surrendered, from and after
the redemption date (unless default shall be made by the Company in providing
money for the payment of the redemption price) dividends on the shares of the
Series A Preferred Stock so called for redemption shall cease to accrue, and
said shares shall no longer be deemed to be outstanding, and all rights of the
holders thereof as stockholders of the Company (except the right to receive from
the Company the redemption price) shall cease. Upon surrender in accordance with
said notice of the certificates for any shares so redeemed (properly endorsed or
assigned for transfer, if the Board of Directors shall so require and the notice
shall so state), such shares shall be redeemed by the Company at the redemption
price aforesaid. In case fewer than all the shares represented by any such
13
certificate are redeemed, a new certificate shall be issued representing the
unredeemed shares without cost to the holder thereof. Any shares of the Series A
Preferred Stock that shall at any time have been redeemed shall, after such
redemption, in the discretion of the Board of Directors of the Company, be (x)
held in treasury or (y) resume the status of authorized but unissued shares of
preferred stock, without designation as to series, until such shares are once
more designated as part of a particular series by the Board of Directors.
6. AMENDMENTS. No provision of these terms of the Series A Preferred Stock
may be amended, modified or waived as to such Series without the written consent
or affirmative vote of the holders of at least fifty-one percent (51%) of the
then outstanding shares of Series A Preferred Stock.
IN WITNESS WHEREOF , North American Gold & Minerals Fund has caused this
Certificate to be signed by ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, its President and CEO, this
11th day of August, 2010.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
President & CEO
14
EXHIBIT B
TERMS OF SERIES "B" PREFERRED SHARES
CERTIFICATE OF DESIGNATIONS, PREFERENCES AND RIGHTS OF SERIES "B" PREFERRED
STOCK OF NORTH AMERICAN GOLD & MINERALS FUND.
NORTH AMERICAN GOLD & MINERALS FUND (the "Company"), a corporation
organized and existing under and by virtue of the Revised Statutes of the State
of Nevada (the "NRS"), in accordance with Section 78.1955 of the NRS, DOES
HEREBY CERTIFY that:
The Amended and Restated Articles of Incorporation of the Company provide
that the Company is authorized to issue 1,000,000,000 shares of preferred stock,
par value US$0.0001 per share. The Amended and Restated Articles of
Incorporation provide, further, that the Board of Directors is authorized, to
the extent permitted by law, to provide for the issuance of the shares of
preferred stock in series, and by filing a certificate pursuant to the NRS, to
establish from time to time the number of shares to be included in each series
and to fix the designation, powers, preferences and rights and the
qualifications, limitations or restrictions thereof. Pursuant to the authority
conferred upon the Board of Directors by the Amended and Restated Articles of
Incorporation, the Board of Directors, by Unanimous Written Consent dated August
11, 2010, adopted a resolution providing for the designation, rights, powers and
preferences and the qualifications, limitations and restrictions of 62,630,000
shares of Series B Preferred Stock, par value US$0.0001 per share, and that a
copy of such resolution is as follows:
RESOLVED, that pursuant to the authority vested in the Board of Directors
of the Company, the provisions of its Amended and Restated Articles of
Incorporation, and in accordance with the NRS, the Board of Directors hereby
authorizes the filing of a Certificate of Designations, Preferences and Rights
of Series B Preferred Stock of North American Gold & Minerals Fund. Accordingly,
the Company's Series B Preferred Stock shall have the powers, preferences and
rights and the qualifications, limitations and restrictions thereof, as follows:
1. DESIGNATION AND NUMBER OF SHARES. Shares of the series shall be
designated and known as the Series B Preferred Stock of the Company. The Series
B Preferred Stock shall consist of 62,630,000 shares and have a par value of
US$0.0001 per share. Shares of the Series B Preferred Stock (hereinafter
referred to as the "Series B Preferred Stock") which are retired, converted into
shares of the Company's common stock, purchased or otherwise acquired by the
Company shall be cancelled and shall revert to authorized but un-issued
preferred stock, undesignated as to series and subject to re-issuance by the
Company as shares of preferred stock of any one or more series.
2. LIQUIDATION OF THE COMPANY OR SALE OF INVESTMENT IN SHARES OF SOUTH
COPPERSTONE, INC.
15
2.1 LIQUIDATION PREFERENCE Upon (a) any liquidation, dissolution or winding
up of the Company, whether voluntary or involuntary, or (b) any sale by the
Company of all or substantially all of its investment in shares (the "South
Copperstone Shares") of common stock of South Copperstone Inc., a Wyoming
corporation ("South Copperstone"), the holders of the shares of Series B
Preferred Stock shall be senior in rights to the holders of the Company's common
stock as to proceeds of sale (after deduction of the costs and expenses of sale
and a 5% handling fee, the "South Copperstone Proceeds") of the Company's South
Copperstone Shares and shall be entitled to be paid a maximum amount equal to
Two Dollars and Twenty Cents (US$2.20) per share (the "Liquidation Preference")
of the Series B Preferred Stock from said South Copperstone Proceeds. Such
amount payable with respect to one share of Series B Preferred Stock, as the
case may be, is sometimes referred to herein as the "South Copperstone
Liquidation Payment" and, with respect to all shares of Series B Preferred
Stock, as the "South Copperstone Liquidation Payments".
2.2 If upon (a) such liquidation, dissolution or winding up of the Company,
whether voluntary or involuntary, or (b) such sale by the Company of all or
substantially all of its investment in the South Copperstone Shares, the South
Copperstone Proceeds shall be insufficient to permit payment to the holders of
Series B Preferred Stock of the full South Copperstone Liquidation Payments,
then the entire South Copperstone Proceeds shall be distributed ratably among
the Series B Holders.
2.4 Upon (a) any such liquidation, dissolution or winding up of the Company
or (b) any such sale by the Company of all or substantially all of its
investment in the South Copperstone Shares, after the holders of Series B
Preferred Stock shall have been paid in full any South Copperstone Liquidation
Payment to which they shall be entitled as set forth in subparagraph 2.1 above,
the remaining net assets of the Company or South Copperstone Proceeds (to the
extent that the Board of Directors declares a dividend), as the case may be,
shall be distributed to the holders of common stock in proportion to the shares
of common stock then held by them.
3. SOUTH COPPERSTONE DIVIDEND PREFERENCE. To the extent that any dividends
are declared by the Board of Directors of the Company from current earnings of
the Company that are attributable to any dividends paid to the Company by South
Copperstone ("South Copperstone Dividends") or South Copperstone Proceeds (after
deduction of a 5% handling fee), shares of Series B Preferred Stock shall be
entitled to receive dividends at a fixed annual rate of Three Percent (3%) of
the Liquidation Preference,, payable solely from said South Copperstone
Dividends or South Copperstone Proceeds, before any South Copperstone Dividends
are paid by the Company on its common shares. Such dividends payable to the
holders of the Series B Preferred Stock shall not be cumulative. So long as any
shares of Series B Preferred Stock are outstanding, no dividend (other than a
dividend in common stock or in any other shares ranking junior to the Series B
Preferred Stock ) shall be declared or paid in any year from South Copperstone
Dividends or South Copperstone Proceeds (other than from said 5% handling fee)
unless, in each case, the full dividend for said year on all outstanding shares
of Series B Preferred Stock shall have been or contemporaneously are declared
and paid from the South Copperstone Dividends or South Copperstone Proceeds.
16
4. NO VOTING RIGHTS. Except as may be required by law and as is provided in
this Certificate, no holder of outstanding shares of Series B Preferred Stock
shall be entitled to vote their shares of Series B Preferred Stock.
5. REDEMPTION. The shares of Series B Preferred Stock shall not be
redeemable prior to December 31, 2010. On and after January 1, 2011, the
Company, at its option, may redeem shares of Series B Preferred Stock, as a
whole or in part, for cash, at any time or from time to time, at a redemption
price of Two Dollars and Twenty Cents (US$2.20) per share plus, in each case,
any declared and unpaid dividends thereon to the date fixed for redemption. In
the event that fewer than all of the outstanding shares of Series B Preferred
Stock are to be redeemed, the number of shares to be redeemed shall be
determined by the Board of Directors and the shares to be redeemed shall be
determined by lot or pro rata as may be determined by the Board of Directors or
by any other method as may be determined by the Board of Directors in its
discretion to be equitable. In the event the Company shall redeem shares of the
Series B Preferred Stock, notice of such redemption shall be given by first
class mail, postage prepaid, mailed not less than 30 nor more than 60 days prior
to the redemption date, to each holder of record of the shares to be redeemed,
at such holder's address as appears on the stock records of the Company, or by
publishing notice thereof in a newspaper of general circulation in ▇▇▇▇▇ County,
Nevada. If the Company elects to provide such notice by publication, it shall
also promptly mail notice of such redemption to each holder of the shares of
Series B Preferred Stock to be redeemed. Each such mailed or published notice
shall state: (a) the redemption date; (b) the number of shares of Series B
Preferred Stock to be redeemed and, if fewer than all the shares held by such
holder are to be redeemed, the number of such shares to be redeemed from such
holder; (c) the redemption price; (d) the place or places where certificates for
such shares are to be surrendered for payment of the redemption price; and (e)
that dividends on the shares to be redeemed will cease to accrue on such
redemption date. No defect in the notice of redemption or in the mailing thereof
shall affect the validity of the redemption proceedings, and the failure to give
notice to any holder of shares of the Series B Preferred Stock to be so redeemed
shall not affect the validity of the notice given to the other holders of shares
of the Series B Preferred Stock to be redeemed. Notice having been mailed or
published as aforesaid, then, notwithstanding that the certificates evidencing
the shares of the Series B Preferred Stock shall not have been surrendered, from
and after the redemption date (unless default shall be made by the Company in
providing money for the payment of the redemption price) dividends on the shares
of the Series B Preferred Stock so called for redemption shall cease to accrue,
and said shares shall no longer be deemed to be outstanding, and all rights of
the holders thereof as stockholders of the Company (except the right to receive
from the Company the redemption price) shall cease. Upon surrender in accordance
with said notice of the certificates for any shares so redeemed (properly
endorsed or assigned for transfer, if the Board of Directors shall so require
and the notice shall so state), such shares shall be redeemed by the Company at
the redemption price aforesaid. In case fewer than all the shares represented by
any such certificate are redeemed, a new certificate shall be issued
17
representing the unredeemed shares without cost to the holder thereof. Any
shares of the Series B Preferred Stock that shall at any time have been redeemed
shall, after such redemption, in the discretion of the Board of Directors of the
Company, be (x) held in treasury or (y) resume the status of authorized but
unissued shares of preferred stock, without designation as to series, until such
shares are once more designated as part of a particular series by the Board of
Directors.
6. AMENDMENTS. No provision of these terms of the Series B Preferred Stock
may be amended, modified or waived as to such Series without the written consent
or affirmative vote of the holders of at least fifty-one percent (51%) of the
then outstanding shares of Series B Preferred Stock.
IN WITNESS WHEREOF, North American Gold & Minerals Fund has caused this
Certificate to be signed by ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, its President and CEO, this
11th day of August, 2010.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
President & CEO
18