Montana Tunnels Mining, Inc.: Montana Tunnels Mine Facility Agreement
Agreement
Montana
Tunnels Mining, Inc.: Montana Tunnels Mine
Montana
Tunnels Mining, Inc.
Apollo
Gold Corporation
Apollo
Gold Inc.
RMB
Australia Holdings Limited
RMB
Resources Inc.
▇▇▇▇▇.▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇
▇▇▇▇▇▇.▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇
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QV.1
Building ▇▇▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
GPO
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▇▇▇▇▇▇
Melbourne Perth Brisbane Singapore
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Telephone
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DX 104 Perth
Correspondent
Offices in Hanoi Ho Chi Minh City
Jakarta
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Summary
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Matter
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Montana
Tunnels Mining Inc.: Montana Tunnels Mine
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Overview
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A
financing of up to US$8,000,000 to Montana Tunnels Mining,
Inc.
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Contents
Table
of
contents
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The
agreement
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1
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Operative
part
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3
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1
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Definitions
and interpretations
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3
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1.1
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Definitions
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3
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1.2
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Interpretations
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21
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1.3
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Inclusive
expressions
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22
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1.4
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Business
Day
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22
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1.5
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Accounting
Standards
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22
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2
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Conditions
precedent
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22
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2.1
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Conditions
precedent to initial Funding Portion
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22
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2.2
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Conditions
precedent to all Funding Portions
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24
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2.3
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Certified
copies
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24
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2.4
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Benefit
of conditions precedent
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24
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3
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Commitment,
purpose and availability of Facility
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24
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3.1
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Provision
of Commitment
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24
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3.2
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Purpose
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24
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3.3
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Cancellation
of Commitment during Availability Period
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25
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3.4
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Cancellation
at end of Availability Period
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25
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3.5
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Voluntary
prepayment
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25
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3.6
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Mandatory
prepayment
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25
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3.7
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Cancellations
and prepayments in inverse order
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25
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4
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Funding
and rate setting procedures
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26
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4.1
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Delivery
of Funding Notice
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26
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4.2
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Requirements
for a Funding Notice
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26
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4.3
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Irrevocability
of Funding Notice
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26
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4.4
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Amount
of Funding Portions
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26
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4.5
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Selection
of Interest Periods
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26
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4.6
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Determination
of Funding Rate
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27
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5
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Facility
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27
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5.1
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Provision
of Funding Portions
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27
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5.2
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Repayment
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27
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5.3
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Repayment
of other Secured Moneys
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27
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5.4
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Interest
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27
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5.5
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Calculation
of per annum interest rate
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27
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6
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Payments
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28
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6.1
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Manner
of payment
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28
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6.2
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Payments
on a Business Day
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28
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6.3
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Payments
in gross
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28
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6.4
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Additional
payments
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28
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6.5
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Taxation
deduction procedures
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29
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6.6
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Tax
Credit
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29
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6.7
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Tax
affairs
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29
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6.8
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Amounts
payable on demand
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29
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Contents
1
Contents
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6.9
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Appropriation
of payments
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29
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6.10
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Currency
exchanges
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30
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7
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Representations
and warranties
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30
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7.1
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General
representations and warranties
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30
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7.2
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Project
representations and warranties
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33
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7.3
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Survival
and repetition of representations and warranties
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34
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7.4
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Reliance
by Finance Parties
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34
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8
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Undertakings
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34
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8.1
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Conduct
of Project
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34
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8.2
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Project
Covenants
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35
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8.3
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Provisions
relating to the MDOA
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35
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8.4
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Environmental
issues
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36
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8.5
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Mineral
Rights
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36
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8.6
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Corporate
budget
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36
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8.7
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Provision
of information and reports
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37
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8.8
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Proper
accounts
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37
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8.9
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Notices
to the Agent
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38
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8.10
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Corporate
existence
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39
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8.11
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Compliance
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39
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8.12
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Maintenance
of capital
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39
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8.13
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Compliance
with laws and Authorisations
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39
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8.14
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Payment
of debts, outgoings and Taxes
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40
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8.15
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Project
Documents
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40
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8.16
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Amendments
to constitution
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40
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8.17
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Negative
pledge and disposal of assets
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40
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8.18
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No
change to business
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41
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8.19
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Financial
accommodation and Financial Indebtedness
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41
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8.20
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Arm’s
length transactions
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41
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8.21
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No
Subsidiaries
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42
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8.22
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Restrictions
on Distributions and fees
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42
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8.23
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Undertakings
regarding Secured Property
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42
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8.24
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Insurance
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43
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8.25
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Financial
undertakings
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44
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8.26
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Hedging
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45
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8.27
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Repayment
of Secured Debentures and ▇▇▇ ▇▇▇
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▇▇
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8.28
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Subordination
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45
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8.29
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Term
of undertakings
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46
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9
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Cashflow
Model
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46
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9.1
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Calculations
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46
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9.2
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Calculations
in United States Dollars
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47
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9.3
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Maintenance
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47
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9.4
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Update
of Cashflow Model
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47
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9.5
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Factors
since commencement of production
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47
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9.6
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Delivery
of updated Cashflow Model
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47
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9.7
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Determination
is binding
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47
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10
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Transaction
Accounts
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48
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10.1
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Establishment
of Transaction Accounts
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48
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10.2
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Project
Operating Account
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48
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Proceeds
Account
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48
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10.4
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Limit
on withdrawals
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48
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Contents
2
Contents
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11
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Events
of Default
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49
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11.1
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Events
of Default
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49
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11.2
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Effect
of Event of Default
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51
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11.3
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Transaction
Parties to continue to perform
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51
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11.4
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Enforcement
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52
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11.5
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Review
event
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52
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12
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Increased
costs and illegality
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52
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12.1
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Increased
costs
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52
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12.2
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Illegality
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53
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12.3
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Reduction
of Commitment
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53
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13
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Indemnities
and Break Costs
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53
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13.1
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General
indemnity
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53
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13.2
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Break
Costs
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54
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13.3
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Foreign
currency indemnity
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54
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13.4
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Conversion
of currencies
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54
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13.5
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Continuing
indemnities and evidence of Loss
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55
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14
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Fees,
Tax, costs and expenses
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55
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14.1
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Arrangement
fee
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55
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14.2
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Commitment
fee
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55
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14.3
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Tax
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55
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14.4
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Costs
and expenses
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56
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15
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Interest
on overdue amounts
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56
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15.1
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Payment
of interest
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56
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15.2
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Accrual
of interest
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56
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15.3
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Rate
of interest
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56
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16
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Assignment
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57
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16.1
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Assignment
by Transaction Party
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57
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16.2
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Borrower
obligation in registered form
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57
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16.3
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Assignment
by Finance Party
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57
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16.4
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Assist
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57
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16.5
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Participation
not permitted
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57
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16.6
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Lending
Office
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57
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16.7
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No
increase in costs
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58
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17
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Saving
provisions
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58
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17.1
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No
merger of security
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58
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17.2
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Exclusion
of moratorium
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58
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17.3
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Conflict
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58
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17.4
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Consents
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58
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17.5
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Principal
obligations
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58
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17.6
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Non-avoidance
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59
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17.7
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Set-off
authorised
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59
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17.8
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Agent’s
certificates and approvals
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59
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17.9
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No
reliance or other obligations and risk assumption
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59
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17.10
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Power
of attorney
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60
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18
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General
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60
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18.1
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Confidential
information
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60
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Transaction
Party to bear cost
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60
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18.3
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Notices
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60
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Contents
3
Contents
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18.4
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Governing
law and jurisdiction
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61
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18.5
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Prohibition
and enforceability
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61
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18.6
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Waivers
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61
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18.7
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Variation
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62
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18.8
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Cumulative
rights
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62
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18.9
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Attorneys
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62
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18.10
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Counterparts
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62
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Schedules
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Notice
Details
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64
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Repayment
Schedule
|
66
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Securities
|
67
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Officer’s
certificate
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68
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Funding
Notice
|
70
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Promissory
Note
|
71
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Permitted
Encumbrances
|
73
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Material
Agreements
|
75
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▇▇▇
▇▇▇
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▇▇
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Key
Mineral Rights
|
90
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Current
Insurance Policies
|
96
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97
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Signing
page
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Freehills
owns the copyright in this document and using it without permission is strictly
prohibited.
Contents
4
The
agreement
Date
►
|
Between
the parties
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Borrower
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Montana
Tunnels Mining, Inc.
a
corporation existing under the laws of Delaware, United States
of
America
of
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ Village, Colorado
80111-3220, United States of America
(Borrower)
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|
Guarantors
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Apollo
Gold Corporation
a
corporation existing under the laws of the Yukon Territory,
Canada
of
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ Village, Colorado
80111-3220, United States of America
(APG)
|
|
Apollo
Gold Inc.
a
corporation existing under the laws of Delaware, United States
of
America
of
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ Village, Colorado
80111-3220, United States of America
(AGI)
|
|
|
Financier
|
RMB
Australia Holdings Limited
a
company incorporated under the laws of Australia
of
▇▇▇▇▇ ▇▇, ▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇
(Financier)
|
|
Agent
|
RMB
Resources Inc.
a
company incorporated under the laws of Delaware, United States
of
America
of
▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇ of
America
(Agent)
|
page
1
The
agreement
|
Background
|
the
Financier has agreed to provide the Facility to the Borrower
on the terms
of this agreement.
|
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The
parties agree
|
as
set out in the operative part of this agreement, in consideration
of,
among other things, the mutual promises contained in this
agreement.
|
page
2
Operative
part
1 Definitions
and interpretations
1.1 Definitions
The
meanings of the terms used in this document are set out
below.
|
Term
|
Meaning
|
||
|
Accounting
Standards
|
generally
accepted accounting principles in Canada.
|
||
|
Affiliate
|
with
respect to a Person:
|
||
|
1
|
any
partner, officer, ten percent (10%) or more shareholder,
manager,
director, employee or managing agent of that Person or
that Person’s
Affiliates;
|
||
|
2
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any
spouse, parent, siblings, children or grandchildren (by
birth or adoption)
of that Person; and
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||
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3
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any
other Person (other than a Subsidiary):
|
||
|
·
|
that
directly or indirectly through one or more intermediaries,
controls, or is
controlled by, or is under common control with, that Person;
|
||
| · |
that
directly or indirectly beneficially owns or holds 10% or
more of any class
of voting stock or partnership or other voting interest
of that Person or
any Subsidiary of that Person; or
|
||
| · |
10%
or more of the voting stock or partnership or other voting
interest of
which is directly or indirectly beneficially owned or held
by that Person
or a Subsidiary of that Person.
|
||
|
Attorney
|
· |
an
attorney appointed under a Transaction Document.
|
|
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Authorisation
|
1
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any
consent, registration, filing, agreement, notice of non-objection,
notarisation, certificate, licence, approval, permit, authority
or
exemption; or
|
|
|
2
|
in
relation to anything which a Government Agency may prohibit
or restrict
within a specific period, the expiry of that period without
intervention
or action or notice of intended intervention or action.
|
||
|
Availability
Period
|
the
period commencing on the satisfaction of the conditions
precedent in
clause 2.1
and ending on the earlier of:
|
||
|
1
|
the
date on which the Commitment is cancelled in full under
this agreement;
or
|
||
|
2
|
31
December 2007.
|
||
|
▇▇▇▇▇▇▇
Title Reports
|
1
|
the
“Montana Tunnels Patented Ground Title Report” prepared at the request of
▇▇▇▇▇▇▇ and Associates, Inc. dated 2 February 2007; and
|
|
|
2
|
the
“MTMI Unpatented Mining Claims Location to Present Title
Report” prepared
at the request of ▇▇▇▇▇▇▇ and Associates, Inc. dated 2
February
2007.
|
||
page
3
|
1 Definitions
and interpretations
|
|
Term
|
Meaning
|
|
|
Best
Efforts
|
in
respect of clause 8.3(a)
the commercially reasonable best
efforts of the Borrower in its capacity as a participant in
the Project
having the percentage interest which the Borrower holds from
time to time
(50% at the date of this agreement) in the MDOA.
|
|
|
Break
Costs
|
for
any repayment or prepayment the amount (if any) by which:
|
|
|
1
|
the
interest on the amount repaid or prepaid which the Financier
should have
received under this agreement (had the repayment or prepayment
not
occurred),
|
|
|
exceeds:
|
||
|
2
|
the
return which that Financier would be able to obtain by placing
the amount
repaid or prepaid to it on deposit with a Reference Bank,
|
|
|
in
each case for the period from the date of repayment or prepayment
until
the last day of the then current Interest Period applicable
to the repaid
or prepaid amount.
|
||
|
Business
Day
|
1
|
for
the purposes of clause 18.3,
a
day on which banks are open for business in the city where
the notice or
other communication is received excluding a Saturday, Sunday
or public
holiday; and
|
|
2
|
for
all other purposes, a day on which banks are open for business
in Sydney,
Australia and Denver, Colorado, excluding a Saturday, Sunday
or public
holiday.
|
|
|
CADS
|
in
respect of a period, the Revenue for that period less the aggregate
of the
following amounts actually paid by the Borrower during that
period (or,
where not actually paid at the date of any calculation, projected
or
estimated by the Borrower to be actually paid by the Borrower
during that
period as contemplated in the Cashflow Model):
|
|
|
1
|
Operating
Costs in accordance with the latest Cashflow Model; and
|
|
|
2
|
any
fees, Taxes or royalties paid to a Government Agency in respect
of the
Project (whether currently payable or levied or imposed after
the date of
this agreement) or royalties payable under the terms of any
agreement in
relation to the Mineral Rights.
|
|
|
Calculation
Date
|
each
Quarterly Date while there is Principal Outstanding or exposure
under a
Financier Hedging Agreement with respect to Product.
|
|
|
Canada
Trust
Securities
|
1
|
the
General Security Agreement granted by APG in favour of the
Canada Trust
Company dated 4 January 2006;
|
|
2
|
the
charge granted by APG in favour of the Canada Trust Company
dated 6
January 2006;
|
|
|
3
|
the
Assignment of Material Documents granted by APG in favour of
the Canada
Trust Company dated 6 January 2006;
|
|
|
4
|
the
Assignment of Insurance granted by APG in favour of the Canada
Trust
Company dated 6 January 2006;
|
|
page
4
|
|
1 Definitions
and interpretations
|
|
Term
|
Meaning
|
|
5
the
Environmental Indemnity Agreement granted by APG in favour of the
Canada
Trust Company dated 4 January 2006; and
6
the
Construction Lien, Warranty and Indemnity granted by APG in favour
of the
Canada Trust Company dated 4 January 2006,
granted
to secure obligations under the Secured Debentures.
|
|
|
Cashflow
Model
|
the
cashflow model prepared by the Borrower and approved by the Agent
and
based on the Project Plan to be initially provided in accordance
with
clause 2.1(g)
and then provided in an updated form under clause 9.
|
|
Change
in Law
|
any
present or future law, regulation, treaty, order or official directive
or
request (which, if not having the force of law, would be complied
with by
a responsible financial institution) which:
1
commences,
is introduced, or changes, after the date of this agreement;
and
2
does
not relate to a change in the effective rate at which Tax is imposed
on
the overall net income of a Finance Party.
|
|
▇▇▇▇▇▇▇▇
Litigation
|
the
litigation commenced as at the date of this agreement and known
in its
filing as “▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, et ▇▇ ▇. Montana Tunnels Mining, Inc. and
Apollo Gold, Inc.”.
|
|
Collateral
Security
|
any
present or future Encumbrance, Surety Obligation or other document
or
agreement created or entered into by a Transaction Party or any
other
person as security for, or to credit enhance, the payment of any
of the
Secured Moneys, including any further security granted under clause
8.23(b).
|
|
Commitment
|
the
maximum aggregate amount agreed to be provided by the Financier
under the
Facility, being US$8,000,000, as reduced or cancelled in accordance
with
this agreement.
|
|
Contamination
|
in
respect of a property, the presence of Pollutants:
1
in,
on or under the property; or
2
in
the ambient air and emanating from the property.
|
|
Contested
Tax
|
a
Tax payable by a Transaction Party where the Transaction Party
is
contesting its liability to pay that Tax, and has reasonable grounds
to do
so.
|
|
Control
|
of
a Person, includes the possession directly or indirectly of the
power,
whether or not having statutory, legal or equitable force, and
whether or
not based on statutory, legal or equitable rights, directly or
indirectly,
to do any of the following:
1
where
the word Control is used in the context of a Review Event, to control
20%
or more of the total votes which might be cast at a general meeting
of
that Person;
2
where
the word Control is used elsewhere in this agreement, to control
50% or
more of the total votes which might be cast at a general meeting
of that
Person;
|
page
5
|
|
1 Definitions
and interpretations
|
|
Term
|
Meaning
|
|
3
to
elect or appoint a majority of the board of directors or other
governing
body of that Person; or
4
to
direct or cause the direction of the management and policies of
that
company whether by means of trusts, agreements, arrangements,
understandings, the ownership of any interest in shares or stock
of that
company or otherwise.
|
|
|
Corporate
Budget
|
the
consolidated corporate budget for non-Project expenditures of the
Borrower, AGI and APG through the end of 2008, to be provided in
accordance with clause 2.1(e)
and amended to the extent that the Agent agrees to a proposal provided
under clause 8.7(b).
|
|
Current
Insurance Policies
|
the
policies summarised in schedule 11.
|
|
Default
|
1
an
Event of Default; or
2
a
Potential Event of Default.
|
|
Dispose
|
in
relation to any asset, property or right, means to sell, transfer,
assign,
surrender, convey, lease, licence, lend, farm-out or otherwise
dispose of
any interest in the asset, property or right.
|
|
Distribution
|
any
dividend, distribution or other amount declared or paid by a Transaction
Party on any Marketable Securities issued by it.
|
|
Documents
|
the
Transaction Documents and the Project Documents.
|
|
EKT
|
Elkhorn
Tunnels, LLC, a limited liability company existing under the laws
of
Delaware, United States of America.
|
|
Encumbrance
|
1
any
mortgage, agreement to secure debt, agreement of trust, lien, pledge,
charge, capital lease, conditional sale or other title retention
agreement, or other security interest, security title or encumbrance
of
any kind in respect of any property of that Person or upon the
income and
profits therefrom, whether that interest is based on the common
law,
statute or contract;
2
any
arrangement, express or implied, under which any property of that
Person
is transferred, sequestered or otherwise identified for the purpose
of
subjecting the same to the payment of Financial Indebtedness or
performance of any other obligation in priority to the payment
of the
general, unsecured creditors of that Person; and
3
the
filing of, or any agreement to give, any financing statement under
the
Uniform Commercial Code of any state or its equivalent in any
jurisdiction.
|
|
Environmental
Approvals
|
all
consents, approvals, licences or other Authorisations of any kind
required
by Environmental Law.
|
page
6
|
|
1 Definitions
and interpretations
|
|
Term
|
Meaning
|
|
Environmental
Bonding
|
the
environmental bonding described in paragraph 1.4 of Exhibit A to
the MDOA,
except to the extent pertaining to the Diamond Hill Property described
in
the MDOA.
|
|
Environmental
Law
|
any
law of the United States of America or the State of Montana that
relates
to the protection of the environment or health and safety or manages
Pollutants, including laws concerning land use or the rehabilitation
of
any land, development, Contamination, conservation of natural or
cultural
resources and resource allocation (including any law of the United
States
of America or the State of Montana relating to the exploration
for, and
development or exploitation of, any natural resource).
|
|
Event
of Default
|
any
event specified in clause 11.1.
|
|
Excess
Cashflow
|
on
any Repayment Date, the Borrower’s entitlement to the Net Cashflow (as
defined in the MDOA) for the preceding Quarter minus the following
amounts:
1
any
amount payable to the Financier on that Repayment Date as interest
payable
under this agreement; and
2
the
relevant Repayment Amount due on that Repayment Date,
plus
or minus (as the case may be) the net revenue generated under the
Financier Hedging Agreements.
|
|
Exchange
|
the
Toronto Stock Exchange or the American Stock Exchange and Exchanges
means
both of them.
|
|
Excluded
Claims
|
the
unpatented mining claims listed in schedule 12.
|
|
Excluded
Tax
|
a
Tax imposed by any jurisdiction on the net income of a Finance
Party
but not a Tax:
1
calculated
on or by reference to the gross amount of any payment (without
allowance
for any deduction) derived by a Finance Party under a Transaction
Document
or any other document referred to in a Transaction Document;
or
2
imposed
as a result of a Finance Party being considered a resident of or
organised
or doing business in that jurisdiction solely as a result of it
being a
party to a Transaction Document or any transaction contemplated
by a
Transaction Document.
|
|
Facility
|
the
facility made available by the Financier to the Borrower under
this
agreement.
|
|
Federal
Royalty
|
any
royalty or other fee payable to a Government Agency of the United
States
of America based on the production of minerals from the
Project.
|
|
Final
Repayment Date
|
the
later of the last occurring Repayment Date set out in the left
column of
the Repayment Schedule, or any other date determined to be the
Final
Repayment Date in accordance with this agreement.
|
page
7
|
|
1 Definitions
and interpretations
|
|
Term
|
Meaning
|
|
Finance
Party
|
each
of the Agent and the Financier and Finance
Parties means
both of them.
|
|
Financial
Indebtedness
|
any
debt or other monetary liability in respect of moneys borrowed
or raised
or any financial accommodation including under or in respect of
any:
1
▇▇▇▇,
bond, debenture, note or similar instrument;
2
acceptance,
endorsement or discounting arrangement;
3
Surety
Obligation;
4
finance
or capital Lease;
5
agreement
for the deferral of a purchase price or other payment in relation
to the
acquisition of any asset or service;
6
obligation
to deliver goods or provide services paid for in advance by any
financier;
7
agreement
for the payment of capital or premium on the redemption of any
preference
shares; or
8
Hedging
Agreements,
and
irrespective of whether the debt or liability:
9
is
present or future;
10
is
actual, prospective, contingent or otherwise;
11
is
at any time ascertained or unascertained;
12
is
owed or incurred alone or severally or jointly or both with any
other
person; or
13
comprises
any combination of the above.
|
|
Financial
Report
|
in
relation to an entity, the following financial statements and information
in relation to the entity (or the equivalent financial statements
or
information in the jurisdiction of the entity), prepared for its
financial
quarter, financial half-year or financial year:
1
a
statement of financial performance;
2
a
statement of financial position; and
3
a
statement of cashflows.
|
|
Financier
Hedging
Agreement
|
the
RMB ISDA and each other Hedging Agreement to which the Financier
is a
party.
|
|
Force
Majeure Event
|
1
an
act of God;
2
war,
revolution, an act of terrorism, or any other unlawful act against
public
order or authority;
3
a
restraint by a Government Agency; and
4
any
other event which a reasonable person could not foresee or reasonably
make
provision for or insure against,
which
wholly or partially prevents, hinders, obstructs, delays or interferes
with the development or operation of the Project or the sale of
Product.
|
page
8
|
|
1 Definitions
and interpretations
|
|
Term
|
Meaning
|
|
Funding
Date
|
the
date on which a Funding Portion is provided, or is to be provided,
to the
Borrower under this agreement.
|
|
Funding
Notice
|
a
notice given under clause 4.1.
|
|
Funding
Portion
|
each
portion of the Commitment provided under this agreement.
|
|
Funding
Rate
|
in
respect of an Interest Period, the aggregate of:
1
LIBOR
for that Interest Period; and
2
the
Margin.
|
|
Good
Industry
Practice
|
the
degree of care and skill, diligence, prudence (financial and operational),
foresight and operating practice which would reasonably and ordinarily
be
expected from a skilled operator engaged in the same type of undertaking
as the Project under the same or similar circumstances.
|
|
Government
Agency
|
any
government or any governmental, semi-governmental, administrative,
fiscal
or judicial body, department, commission, authority, tribunal,
agency or
entity.
|
|
Guarantor
|
each
of:
1
AGI;
and
2
APG,
and
Guarantors
means all of them.
|
|
Hedging
Agreement
|
each
interest rate transaction, foreign exchange transaction, equity
or equity
index option, bond option, commodity swap, commodity option, commodity
forward sale, cap transaction, currency swap transaction, cross-currency
swap rate transaction or any other hedge or derivative agreement
entered
into by a Transaction Party, including any master agreement and
any
transaction or confirmation under it.
|
|
Initial
Transaction
Costs
|
1
all
Taxes and registration fees payable on or with respect to the Transaction
Documents;
2
the
arrangement fee described in clause 14.1;
3
the
reasonable legal fees in relation to the preparation, negotiation
and
completion of the Transaction Documents and all related matters;
and
4
all
other fees, costs and expenses (including travel costs, fees payable
to
any independent technical expert and other disbursements) of the
Finance
Parties.
|
|
Inter-Company
Claims
|
1
all
debts and liabilities of each Transaction Party to any other Transaction
Party on any account and in any capacity, irrespective of whether
the
debts and liabilities:
2
are
present or future;
|
page
9
|
|
1 Definitions
and interpretations
|
|
Term
|
Meaning
|
|
3
are
actual, prospective, contingent or otherwise;
4
are
at any time ascertained or unascertained;
5
are
owed or incurred by or on account of a Transaction Party alone
severally
or jointly with another person;
6
are
owed to or incurred for the account of a Transaction Party alone,
or
severally or jointly with another person;
7
are
owed to another person as agent (whether disclosed or not) for
or on
behalf of a Transaction Party; or
8
comprise
a combination of the above.
|
|
|
Interest
Payment
Date
|
the
last day of each Interest Period.
|
|
Interest
Period
|
a
period selected or determined under clause 4.5.
|
|
Key
Mineral Rights
|
those
Mineral Rights required to enable the Borrower to develop and operate
the
Project in accordance with the Cashflow Model and Project Plan
which are,
as at the time of this agreement, the Mineral Rights described
in schedule
10.
|
|
Key
Personnel
|
1
R.
▇▇▇▇▇ ▇▇▇▇▇▇▇ (President and Chief Executive Officer, APG);
2
▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ (Chief Financial Officer; Senior Vice President - Finance
and
Corporate Development, APG);
3
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇ (Vice President and General Manager, MTM); and
4
▇▇▇▇▇
▇▇▇▇▇▇ (Mine Manager, MTM).
|
|
Lease
|
a
lease, sale lease-back, synthetic lease or any other agreement
under which
any property is or may be used or operated by a person other than
the
owner.
|
|
Lending
Office
|
in
respect of a Finance Party, the office of that Finance Party set
out
opposite its name in schedule 1 or any other office notified by a
Finance Party under this agreement.
|
|
LIBOR
Page
|
the
Bloomberg Screen BTMM, being the page on which the British Brokers’
Association Interest Settlement Rate for US Dollars is displayed,
or any
other Bloomberg page which may replace it for the purpose of displaying
offered rates for United States Dollar deposits.
|
|
LIBOR
|
in
relation to an Interest Period for a Funding Portion, the rate
per cent
per annum determined by the Agent to be:
1
the
average of the rates quoted on the LIBOR Page as being the rate
per annum
at which United States Dollar deposits are offered for a period
equivalent
to the Interest Period at about 11.00 am (London time) on the Value
Date,
eliminating the highest and lowest rates and rounding up the resultant
figure to 4 decimal places;
2
where
2 or fewer rates are quoted for the relevant period on the LIBOR
Page at
the relevant time, the average of the rates notified to the Agent
by each
Reference Bank to be the rate per annum at which United States
Dollar
deposits are offered to that Reference Bank for a period equivalent
to the
Interest Period at about 11.00 am (London time) on the Value Date,
rounding up the resultant figure to 4 decimal places; or
|
page
10
|
|
1 Definitions
and interpretations
|
|
Term
|
Meaning
|
|
3
if
LIBOR cannot be determined in accordance with paragraphs 1 or 2
of this
definition, the rate most nearly approximating the rate that would
otherwise have been calculated by the Agent in accordance with
paragraphs
1 or 2 having regard to comparable indices then available in the
financial
markets.
|
|
|
LIBOR
Business Day
|
a
day on which banks are open for business in London and New York
excluding
a Saturday, Sunday or public holiday.
|
|
Loan
Life Cover Ratio
and
LLCR
|
on
any date, the figure calculated by the Agent in accordance with
the
formula:
 where:
LLCR
is
the Loan Life Cover Ratio on that date;
CADS
is
the aggregate of CADS contemplated in the Cashflow Model for the
period
from that date up to the Final Repayment Date, discounted to present
value
at the rate which is the Funding Rate then applying, on a continuous
basis
with quarterly rests, and the balance of the Debt Service Reserve
Account
on that date; and
PO
is
the forecast Principal Outstanding on that date, taking into account
any
repayments or prepayments made on that date.
|
|
Loss
|
any
claim, action, damage, loss, liability, cost, charge, expense,
outgoing or
payment.
|
|
Manager
|
the
manager of the Project appointed in accordance with Article VIII
of the
MDOA, or its successor.
|
|
Margin
|
1.25%
per annum.
|
|
Marketable
Securities
|
1
debentures,
stocks, shares or bonds of any government, of any local Government
Agency,
or of any body corporate, association or society, and includes
any right
or option in respect of shares in any body corporate;
2
any
unit (whatever called) in a trust estate which represents a legal
or
beneficial interest in any of the income or assets of a trust estate
and
includes, but is not limited to, any option to acquire any unit
as
described in this paragraph 2;
3
any
option or right in respect of an unissued share;
4
any
convertible note; and
5
any
instrument or security which is a combination of any of the
above.
|
page
11
|
|
1 Definitions
and interpretations
|
|
Term
|
Meaning
|
|
Material
Adverse
Effect
|
a
material adverse effect on:
1
any
Transaction Party’s ability to perform any of its obligations under any
Transaction Document;
2
the
rights of the Finance Parties under, or the enforceability of,
a
Transaction Document;
3
the
assets, business or operations of the Borrower (including the Project
and
the Project Assets); or
4
the
assets, business or operations of the Transaction Parties on a
consolidated basis.
|
|
Material
Agreement
|
each
of the agreements described in schedule 8.
|
|
MDOA
|
the
Mine Development and Operating Agreement dated as of 28 July 2006
between
the Borrower and EKT, as amended by:
1
a
letter agreement dated 6 October 2006 between the Borrower and
EKT;
2
a
letter agreement dated 30 November 2006 between the Borrower and
EKT;
3
a
letter agreement dated 8 January 2007 between the Borrower and
EKT;
4
a
letter agreement dated 26 January 2007 between the Borrower and
EKT;
and
5
a
letter agreement dated 20 April 2007 between the Borrower and
EKT.
|
|
MDOA
Side Agreement
|
the
side agreement between the Borrower, EKT and the Finance Parties
in
respect of the Mine Development and Operating Agreement.
|
|
Metals
Price Protection
Program
|
a
base metal hedging program with respect to base metals produced
by the
Project to be agreed between the Borrower and the Agent and implemented
by
the Borrower and the Financier as a condition precedent to the
provision
of the Facility.
|
|
Mineral
Rights
|
1
all
of the patented and unpatented mining claims, fee and leased lands,
and
other interests in lands, which are described in the
Securities;
2
all
entitlements of the Borrower or any other Transaction Party under
the
provisions of the Mining Law to conduct exploration or mining activities
in any part of the Project Area;
3
any
present or future interest from time to time held by or on behalf
of the
Borrower or any Transaction Party in any present or future right,
lease,
licence, patented or unpatented mining claim, fee lands, permit,
plan of
operations or other authority which confers or may confer a right
to
prospect or explore for or mine any metals or minerals in any part
of the
Project Area;
4
any
present or future renewal, extension, modification, substitution,
amalgamation or variation of any of the mineral rights described
above
(whether extending over the same or a greater or lesser area);
and
5
any
present or future application for or an interest in any of the
above which
confers or which, when operated, will confer the same or similar
rights in
relation to the Project.
|
page
12
|
|
1 Definitions
and interpretations
|
|
Term
|
Meaning
|
|
Mining
Law
|
any
law, including the relevant laws of Montana or otherwise, whether
or not
deriving from statute, concerning the acquisition by any allowed
means of
interests in public lands or private lands for the purpose of conducting
mining exploration, mine development, mining operations, reclamation
and
related operations on that land, together with the rights necessary
to
conduct those activities, including but not limited to laws relating
to
public land use, development, conservation of natural or cultural
resources and resource allocation and includes any laws concerning
permits, licences and authorisations required to be received before
conducting any of those activities and includes any and all rules,
regulations or ordinances promulgated under or in respect of those
laws.
|
|
MOOA
|
the
Mill Operating and Option Agreement dated as of 28 July 2006 between
Elkhorn Goldfields, Inc. and the Borrower.
|
|
Officer
|
1
in
relation to a Transaction Party, a director, secretary, chief executive
officer, chief financial officer, president or vice president or
a person
notified to be an authorised officer, of the Transaction Party;
or
2
in
relation to a Finance Party, a director, secretary or any person
whose
title includes the word “Director”, “Managing Director”, “Manager” or
“Vice President”, and any other person appointed by the Finance Party to
act as its authorised officer for the purposes of this
agreement.
|
|
Offtake
Agreements
|
1
the
zinc concentrate agreement dated 20 February 2007 between Teck
Cominco and
AGI; and
2
the
lead concentrate agreement dated 20 February 2007 between Teck
Cominco and
AGI.
|
|
Operating
Costs
|
all
expenses (including capital and recurrent expenditure of a routine
nature)
incurred and paid or projected in the Cashflow Model which are
attributable to the Borrower to be incurred or paid by the Borrower
in the
ordinary course of business in connection with the day-to-day activities
of the Project, including:
1
administrative
costs and charges in respect of the operation of the Project by
the
Borrower;
2
premiums
paid with respect to insurance; and
3
payments
with respect to Environmental Bonding,
but
excluding any payments to third parties in respect of liabilities
to them
covered by third party insurance.
|
|
Ordinary
Course of
Business
|
ordinary
course of business of the Borrower consistent with past custom
and
practice (including with respect to quantity and frequency) as
it has been
conducted since 28 July 2006.
|
|
Overdue
Margin
|
2%
per annum.
|
|
Overdue
Rate
|
the
aggregate of:
1
the
Overdue Margin;
|
page
13
|
|
1 Definitions
and interpretations
|
|
Term
|
Meaning
|
|
2
the
Margin; and
3
LIBOR
on the relevant date on which the Overdue Rate is calculated under
clause 15,
as determined by the Agent in accordance with the definition of
LIBOR in
this clause 1.1
except that in making the determination all references in that
definition
to:
·
“Interest
Period” are references to a period of 30 days;
·
“Value
Date” are to the relevant date on which the Overdue Rate is calculated
under clause 15;
and
·
“Funding
Portion” are to the relevant overdue amount.
|
|
|
Payment
Currency
|
the
currency in which any payment is actually made.
|
|
Permitted
Encumbrance
|
each
Encumbrance listed in schedule 7.
|
|
Permitted
Financial Accommodation
|
any
financial accommodation or any Surety Obligation provided by a
Transaction
Party in respect of financial accommodation:
1
under
the Transaction Documents;
2
in
the ordinary course of business up to a maximum aggregate amount
for all
Transaction Parties of US$250,000;
3
which
can be characterised as an Inter-Company Claim; or
4
with
the Agent’s prior written consent.
|
|
Permitted
Financial
Indebtedness
|
1
any
liability of a Transaction Party under any agreement entered
into in the
ordinary course of business for the acquisition of any asset
or service
where payment for the asset or service is deferred for a period
of not
more than 90 days;
2
any
Financial Indebtedness incurred or permitted to be incurred
under any
Transaction Document;
3
any
Inter-Company Claims;
4
each
Secured Debenture;
5
any
Financial Indebtedness incurred or permitted to be incurred
under:
6
the
CAT Installment Sale Contract (Security Agreement) dated 27
February 2007
between MTM and Tractor & Equipment Co.;
7
the
Security Agreement dated 14 May 2007 between MTM and Financial
Federal
Credit Inc.; and
8
the
Master Lease Agreement No. MEF0570 dated 21 November 2006 between
AGI and
Marquette Equipment Finance, LLC.;
9
each
Series ▇▇▇▇-▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ issued by APG;
10
Permitted
Hedging Agreements; or
11
any
other Financial Indebtedness approved by the
Agent.
|
page
14
|
1 Definitions
and interpretations
|
|
Term
|
Meaning
|
|
Permitted
Hedging Agreements
|
1
Hedging
Agreements entered into by APG in order to manage existing and anticipated
risks associated with foreign exchange, currency and interest rates
and
not for speculative purposes where the aggregate of the out of the
money
exposures under those Hedging Agreements does not exceed US$500,000;
or
2
Hedging
Agreements entered into by APG with the consent of the Agent.
|
|
Person
|
an
individual, corporation, limited liability company, partnership,
association, trust or unincorporated organization, or a government
or any
agency, division, department, or political subdivision a
government.
|
|
Pollutant
|
a
pollutant, contaminant, dangerous, toxic or hazardous substance,
petroleum
or petroleum product, chemical, solid, special liquid, industrial
or other
waste.
|
|
Potential
Event of Default
|
any
thing which would become an Event of Default on the giving of notice
(whether or not notice is actually given), the expiry of time, the
satisfaction or non-satisfaction of any condition, or any combination
of
the above.
|
|
Power
|
any
right, power, authority, discretion or remedy conferred on a Finance
Party, a Receiver or an Attorney by any Transaction Document or any
applicable law.
|
|
Principal
Outstanding
|
at
any time, the aggregate principal amount of all outstanding Funding
Portions at that time.
|
|
Proceeds
Account
|
the
account established under clause 10.1(a).
|
|
Product
|
the
present and future right, title and interest of a Transaction Party
in and
to all metals (including ▇▇▇▇, ▇▇▇▇, silver, zinc and lead), minerals,
sulphides and concentrates that are mined, extracted, produced, smelted,
refined, won, or otherwise derived from the Project Area and the
Project.
|
|
Project
|
the
project known as the Montana Tunnels Mine located near Helena, in
Jefferson County, Montana, United States of America and the lands
adjoining the Montana Tunnels Mine which forms part of the Project
Area.
|
|
Project
Area
|
the
areas the subject of the Mineral Rights described in paragraph 1
of the
definition of Mineral Rights.
|
|
Project
Assets
|
all
the right, title and interest both present and future of any Transaction
Party which is attributable to the Project and includes all the
right,
title and interest both present and future of a Transaction Party
in, to,
under or derived from:
1
the
Mineral Rights;
2
the
Product;
3
the
Project Area, including any title to or interest in land in the
Project
Area now or at a later time held by a Transaction
Party;
|
page
15
|
1 Definitions
and interpretations
|
|
Term
|
Meaning
|
|
|
4
the
Sales Contracts;
5
every
contract for the use by any third party of any of the assets and
property
included in the Project;
6
Authorisations
in relation to the Project;
7
the
Project Documents and any other contract, agreement, permit, lease,
licence, consent, easement, right of way and other rights or interests
in
land, which relate to the construction, operation or maintenance
of the
Project, or to the mining production, transportation, storage, treatment,
processing or marketing of the Product;
8
all
exploration and mining information, documents, maps, reports, records,
studies and other written data, including all data stored on magnetic
tapes, disks or diskettes or any other computer storage media, relating
to
geological, geochemical and geophysical work, feasibility studies
and
other operations conducted with respect to the Project Area;
9
all
buildings, improvements, structures, systems, fixtures, plant, machinery,
equipment, barges, tools and other personal property at any time
used or
intended for use in connection with or incidental to the exploration,
mining, storage, transporting and processing of Product, and all
associated facilities and infrastructure (including any treatment
or
processing plant); and
10
every
contract for the use by any third party of any of the assets described
in
paragraphs 1 to 9 inclusive.
|
|
Project
Documents
|
1
all
agreements under which a Transaction Party derives the right to conduct
mining of or exploration for Product;
2
the
MDOA;
3
each
Material Agreement;
4
any
agreement or contract described in clause 8.15(c);
5
any
other document executed from time to time by any person in respect
of the
documents described in paragraphs 1 to 4 inclusive or which is collateral,
supplementary or related to those documents; and
6
any
other document that the Agent and the Borrower agree in writing to
be a
Project Document.
|
|
Project
Life Cover Ratio and
PLCR
|
on
any date, the figure calculated by the Agent in accordance with the
formula:
 where:
PLCR
is
the Project Life Cover Ratio on that date;
CADS
is
CADS contemplated in the Cashflow Model for the period from that
date up
to 31 March 2009, discounted to present value at the rate which is
the
Funding Rate then applying, on a continuous basis with quarterly
rests,
and the balance of the Debt Service Reserve Account on that date;
and
PO
is
the Principal Outstanding on that date, taking into account any repayments
or prepayments made on that date.
|
page
16
|
1 Definitions
and interpretations
|
|
Term
|
Meaning
|
|
Project
Operating Account
|
the
operating account maintained and administered by the Borrower in
its
capacity as operator of the Project and established under clause
10.1(a).
|
|
Project
Plan
|
the
L-PIT Life of Mine Plan dated July 2007, which describes the operating
and
financial budget and the operating and activities plan for the Project,
to
be initially provided in accordance with clause 2.1(k)
and amended to the extent that the Agent agrees to an update provided
under clause 8.7(c).
|
|
Promissory
Note
|
an
instrument in the form set out in schedule 6.
|
|
Proven
Reserves and Probable Reserves
|
“Proven
Reserves” and “Probable Reserves” have the meanings given in, and are
construed, reported and calculated in accordance with, the United
States
Securities and Exchange Commission Industry Guide 7 “Description of
Property by Issuers Engaged or to be Engaged in Significant Mining
Operations”, as amended.
|
|
Quarter
|
the
period of 3 months preceding a Quarterly Date.
|
|
Quarterly
Date
|
each
of 31 March, 30 June, 30 September and 31 December each year.
|
|
Ratio
|
each
of the LLCR and the PLCR and Ratios
means
both of them.
|
|
Receiver
|
a
receiver or receiver and manager appointed under a Security, or a
person
acting in an equivalent role.
|
|
Reference
Banks
|
1
the
principal London offices of Barclays Bank plc, ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ & Co.
and National Westminster Bank plc; or
2
other
banks as the Agent and the Borrower may agree.
|
|
Relevant
Currency
|
the
currency in which a payment is required to be made under the Transaction
Documents and, if not expressly stated to be another currency, is
United
States Dollars.
|
|
Repayment
Amount
|
for
each Repayment Date, the amount set out in the right column of the
Repayment Schedule.
|
|
Repayment
Date
|
each
of the dates set out in the left column of the Repayment
Schedule.
|
|
Repayment
Schedule
|
the
repayment schedule set out in schedule 2.
|
|
Revenue
|
for
any period, the aggregate of the following amounts actually received
(or,
where not received at any date of calculation, projected or estimated
by
the Borrower as likely to be actually received as contemplated in
the
Cashflow Model) during that period:
|
page
17
|
1 Definitions
and interpretations
|
|
Term
|
Meaning
|
|
|
1
Sales
Proceeds;
2
net
amounts received under or in relation to any Hedging Agreement with
respect to Product; and
3
any
other money received in connection with the Project (including proceeds
of
sales of assets and insurance proceeds) and for any purpose
whatsoever,
but
excluding:
4
the
proceeds of a Funding Portion and any other financial accommodation
(other
than under a Financier Hedging Agreement) made available by a Finance
Party; and
5
the
proceeds of any insurance in respect of liabilities to third
parties.
|
|
Review
Event
|
an
event described in clause 11.5(a).
|
|
RMB
GSA
|
the
general security agreement to be granted by APG in favour of the
Finance
Parties in respect of all of the assets of APG substantially in the
form
set out in schedule 9.
|
|
RMB
ISDA
|
the
ISDA Master Agreement dated on or about the date of this agreement
between
the Borrower and the Financier.
|
|
Sales
Contracts
|
any
contract, agreement or arrangement for the sale, transfer or other
disposal of Product including the Offtake Agreements, or any contract,
agreement or arrangement for any agency for sale, exchange, transfer
or
other disposal, of Product including any sale arrangements between
Transaction Parties.
|
|
Sales
Proceeds
|
moneys
received from the sale of Product, including moneys received under
any
Sales Contract.
|
|
Same
Day Funds
|
immediately
available and freely transferable funds.
|
|
Secured
Debentures
|
the
debentures issued under the Trust Indenture between the Canada Trust
Company, APG and AGI dated 4 November 2004.
|
|
Secured
Moneys
|
all
debts and monetary liabilities of each Transaction Party to the
Finance
Parties under or in relation to any Transaction Document and in
any
capacity, irrespective of whether the debts or liabilities:
1
are
present or future;
2
are
actual, prospective, contingent or otherwise;
3
are
at any time ascertained or unascertained;
4
are
owed or incurred by or on account of any Transaction Party alone,
or
severally or jointly with any other person;
5
are
owed to or incurred for the account of any Finance Party alone,
or
severally or jointly with any other
person;
|
page
18
|
1 Definitions
and interpretations
|
|
Term
|
Meaning
|
|
|
6
are
owed to any other person as agent (whether disclosed or not) for
or on
behalf of any Finance Party;
7
are
owed or incurred as principal, interest, fees, charges, Taxes, damages
(whether for breach of contract or tort or incurred on any other
ground),
losses, costs or expenses, or on any other account;
8
are
owed to or incurred for the account of any Finance Party directly
or as a
result of:
·
the
assignment or transfer to any Finance Party of any debt or liability
of
any Transaction Party (whether by way of assignment, transfer or
otherwise); or
·
any
other dealing with any such debt or liability;
9
are
owed to or incurred for the account of a Finance Party before the
date of
this agreement or before the date of any assignment of this agreement
to
any Finance Party by any other person or otherwise; or
10
comprise
any combination of the above.
|
|
Secured
Property
|
the
property subject to a Security.
|
|
Securities
Laws
|
in
respect of a Transaction Party, all securities, companies and corporations
laws, together with all regulations, rules and policy statements
under
those laws, which are applicable to that Transaction Party.
|
|
Security
|
1
each
of the security documents described in schedule 3; and
2
each
Collateral Security,
and
Securities
means
all of them.
|
|
Security
Provider
|
a
person who has granted a Security.
|
|
Services
Agreement
|
the
Services Agreement entered into, or to be entered into, between AGI
and
the Borrower under which AGI agrees to provide the Borrower with
personnel
and administrative support required in order for the Project to operate
at, or substantially at, the levels of production projected in the
Cashflow Model and the Project Plan.
|
|
Statutory
Rights
|
reservations
made in any patents pertaining to the Mineral Rights and, with respect
to
unpatented mining claims, the paramount title of the United States
of
America and the right of the federal government to allow third parties
to
use the surface of the claims.
|
|
Subsidiary
|
a
Person over which another Person has Control.
|
|
Surety
Obligation
|
any
guarantee, suretyship, letter of credit, letter of comfort or any
other
obligation:
1
to
provide funds (whether by the advance or payment of money, the purchase
of
or subscription for shares or other securities, the purchase of assets
or
services, or otherwise) for the payment or discharge
of;
|
page
19
|
1 Definitions
and interpretations
|
|
Term
|
Meaning
|
|
|
2
to
indemnify any person against the consequences of default in the payment
of; or
3
to
be responsible for,
any
debt or monetary liability of another person or the assumption of
any
responsibility or obligation in respect of the insolvency or the
financial
condition of any other person.
|
|
Tax
|
1
any
tax, levy, charge, impost, duty, fee, deduction, compulsory loan
or
withholding including goods and services tax; or
2
any
income, stamp or transaction duty, tax or charge,
which
is assessed, levied, imposed or collected by any Government Agency
and
includes any interest, fine, penalty, charge, fee or other amount
imposed
on or in respect of any of the above.
|
|
Teck
Cominco
|
Teck
Cominco Metals Limited, a British Columbia corporation with offices
at ▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇.
|
|
Termination
Event
|
in
relation to a Financier Hedging Agreement, has the meaning given
to that
term in that Financier Hedging Agreement.
|
|
Transaction
Accounts
|
1
the
Project Operating Account; and
2
the
Proceeds Account.
|
|
Transaction
Document
|
1
this
agreement;
2
each
Security;
3
the
guaranty dated on or about the date of this agreement granted by
APG and
AGI in favour of the Finance Parties;
4
the
MDOA Side Agreement;
5
each
Financier Hedging Agreement;
6
the
deposit account control agreement between the Finance Parties, the
Borrower and the Borrower’s bank in relation to the Transaction
Accounts;
7
any
document or agreement entered into or given under any of the above;
and
8
any
other document that the Agent and the Borrower agree in writing to
be a
Transaction Document.
|
|
Transaction
Party
|
1
the
Borrower;
2
each
Guarantor; and
3
any
other person that the Borrower and the Agent agree is a Transaction
Party.
|
|
Undrawn
Commitment
|
at
any time, the Commitment less the Principal Outstanding at that
time.
|
page
20
|
1 Definitions
and interpretations
|
|
Term
|
Meaning
|
|
US$
and
United
States Dollars
|
the
lawful currency of the United States of America.
|
|
Value
Date
|
the
date 2 LIBOR Business Days before the first day of an Interest
Period.
|
| 1.2 |
Interpretations
|
In
this
agreement headings and bold type are for convenience only and do not affect
the
interpretation of this agreement and, unless the context requires
otherwise:
| (a) |
words
indicating the singular include the plural and vice
versa;
|
| (b) |
words
indicating a gender include any
gender;
|
| (c) |
other
parts of speech and grammatical forms of a word or phrase defined
in this
agreement have a corresponding
meaning;
|
| (d) |
an
expression suggesting or referring to a natural person or an entity
includes any company, partnership, joint venture, association, corporation
or other body corporate and any Government
Agency;
|
| (e) |
a
reference to any thing (including any right) includes a part of that
thing
but nothing in this clause 1.2(e)
implies that performance of part of an obligation constitutes performance
of the obligation;
|
| (f) |
a
reference to a clause, party, annexure, exhibit or schedule is a
reference
to a clause of, and a party, annexure, exhibit and schedule to, this
agreement and a reference to this agreement includes any annexure,
exhibit
and schedule;
|
| (g) |
a
reference to a statute, regulation, proclamation, ordinance or by-law
includes all statutes, regulations, proclamations, ordinances or
by-laws
amending, consolidating or replacing it, whether passed by the same
or
another Government Agency with legal power to do so, and a reference
to a
statute includes all regulations, proclamations, ordinances and by-laws
issued under that statute;
|
| (h) |
a
reference to a document includes all amendments or supplements to,
or
replacements or novations of, that
document;
|
| (i) |
a
reference to liquidation includes official management, appointment
of an
administrator, compromise, arrangement, merger, amalgamation,
reconstruction, winding up, dissolution, deregistration, assignment
for
the benefit of creditors, scheme, composition or arrangement with
creditors, insolvency, bankruptcy, or a similar procedure or, where
applicable, changes in the constitution of any partnership or person,
or
death;
|
| (j) |
a
reference to a party to any document includes that party’s successors and
permitted assigns;
|
| (k) |
a
reference to an agreement other than this agreement includes an
undertaking, agreement or legally enforceable arrangement or understanding
whether or not in writing;
|
| (l) |
a
reference to an asset includes all property of any nature, including
a
business, and all rights, revenues and
benefits;
|
| (m) |
a
reference to a document includes any agreement in writing, or any
certificate, notice, agreement, instrument or other document of any
kind;
|
page
21
|
|
2 Conditions
precedent
|
| (n) |
no
provision of this agreement may be construed adversely to a party
solely
on the ground that the party was responsible for the preparation
of this
agreement or that provision;
|
| (o) |
a
reference to a body, other than a party to this agreement (including
an
institute, association or authority), whether statutory or
not:
|
|
(1)
|
which
ceases to exist; or
|
|
(2)
|
whose
powers or functions are transferred to another
body,
|
is
a
reference to the body which replaces it or which substantially succeeds to
its
powers or functions; and
| (p) |
references
to time and dates are references to time and dates in Denver,
Colorado.
|
| 1.3 |
Inclusive
expressions
|
Specifying
anything in this agreement after the words “include” or “for example” or similar
expressions does not limit what else is included unless there is express wording
to the contrary.
| 1.4 |
Business
Day
|
Except
where clause 6.2
applies,
where the day on or by which any thing is to be done is not a Business Day,
that
thing must be done on or by the preceding Business Day.
| 1.5 |
Accounting
Standards
|
Any
accounting practice or concept relevant to this agreement is to be construed
or
determined in accordance with the Accounting Standards.
| 2 |
Conditions
precedent
|
| 2.1 |
Conditions
precedent to initial Funding
Portion
|
The
Financier is not obliged to provide the Commitment or the first Funding Portion
until the Agent has received all of the following in form and of substance
satisfactory to the Agent:
| (a) |
officer’s
certificate:
an officer’s certificate in the form of schedule 4 given in respect
of each Transaction Party and dated no more than 5 Business Days
before the first Funding Date;
|
| (b) |
Transaction
Documents:
originals of each Transaction Document (other than the RMB GSA) duly
executed by all parties to them other than the Finance Parties and,
where
applicable:
|
|
(1)
|
with
evidence satisfactory to the Agent that all Taxes applicable to the
Transaction Documents have been or will be duly paid;
and
|
|
(2)
|
in
registrable form together with all executed documents necessary to
register them;
|
| (c) |
Project
Documents:
copies of each Project Document, including a copy of the Services
Agreement, duly executed by all parties to
them;
|
| (d) |
Hedging:
evidence that:
|
|
(1)
|
the
Metals Price Protection Program has been implemented;
and
|
|
(2)
|
each
Transaction Party has complied with clause 8.26;
|
page
22
|
|
2 Conditions
precedent
|
| (e) |
Corporate
Budget:
a
copy of the Corporate Budget initialled by the Borrower and the Agent
for
identification purposes;
|
| (f) |
Financial
Reports:
a
copy of:
|
|
(1)
|
the
audited consolidated Financial Report of APG for the financial year
ending
31 December 2006; and
|
|
(2)
|
the
unaudited quarterly Financial Reports of APG, and the Borrower for
the
Quarter ending 30 June 2007;
|
| (g) |
Cashflow
Model:
a
copy of the Cashflow Model initialled by the Borrower and the Agent
for
identification purposes;
|
| (h) |
Key
Mineral Rights:
evidence that the Borrower is the legal holder of the Key Mineral
Rights
and that the Key Mineral Rights are valid and in good standing and
give
the Borrower all rights required to enable the Borrower to conduct
the
Project in accordance with the Cashflow
Model;
|
| (i) |
good
title:
evidence that the Borrower has good title to the Project Assets and
its
other Secured Property;
|
| (j) |
opinions:
|
|
(1)
|
an
opinion from ▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP in respect of the
enforceability of the Transaction Documents (other than the General
Security Agreement) and the due execution of the Transaction Documents
by
AGI and the Borrower;
and
|
|
(2)
|
an
opinion from Fogler, ▇▇▇▇▇▇▇▇ LLP in respect of due execution of
the
Transaction Documents by APG;
|
| (k) |
Project
Plan:
a
copy of the Project Plan initialled by the Borrower and the Agent
for
identification purposes;
|
| (l) |
Project
Authorisations:
evidence that all Authorisations have been obtained in connection
with the
development, construction and operation of the Project, including
all
Environmental Approvals;
|
| (m) |
Environmental
Bonding:
evidence that the Borrower has complied with all its obligations
in
respect of the Environmental Bonding and that the Environmental Bonding
arrangements are the only environmental bonds required to be taken
out in
accordance with the requirements of any Environmental Law relating
to the
Project or Project Area;
|
| (n) |
Authorisations:
evidence that all Authorisations have been obtained in connection
with the
transactions contemplated by the
Documents;
|
| (o) |
insurance:
evidence that the Borrower has complied with clause 8.24;
|
| (p) |
Initial
Transaction Costs:
evidence that the Initial Transaction Costs have been or will be
paid in
full at the time that the initial Funding Portion is
provided;
|
| (q) |
Transaction
Accounts:
evidence that the Transaction Accounts have been
established;
|
| (r) |
enquiries:
results of searches, enquiries and requisitions in respect of each
Transaction Party and the Project Assets and other Secured
Property;
|
| (s) |
due
diligence:
evidence of the completion of any technical, legal and commercial
due
diligence investigations with respect to the Borrower and the Project
Assets and other Secured Property, including detailed mining plans,
layouts, plant flow sheets and reserve and resource
estimations;
|
| (t) |
other
approvals:
evidence that all other approvals necessary for the transactions
contemplated by the Transaction Documents have been obtained;
and
|
| (u) |
other
matters:
any other certificates, Authorisations, documents, matters or things
which
the Agent or the Financier reasonably requires.
|
page
23
|
3 Commitment,
purpose and availability of
Facility
|
| 2.2 |
Conditions
precedent to all Funding
Portions
|
The
Financier is not obliged to provide a Funding Portion until the following
conditions are fulfilled to the satisfaction of the Agent:
| (a) |
Funding
Notice:
the Borrower has delivered a Funding Notice to the Agent requesting
the
Funding Portion;
|
| (b) |
Funding
Date:
the Funding Date for the Funding Portion is a Business Day within
the
Availability Period;
|
| (c) |
Commitment:
the Commitment of that Financier will not be exceeded by providing
the
Funding Portion;
|
| (d) |
no
Default:
no Default has occurred which is continuing and no Default will result
from the Funding Portion being
provided;
|
| (e) |
no
Material Adverse Effect:
since the end of the accounting period for the Financial Reports
most
recently provided under clause 8.7(a)
or
2.1(f),
no event has occurred which has had, or is reasonably likely to have,
a
Material Adverse Effect and no event has occurred which will prevent
the
Borrower from developing, constructing or operating the Project in
accordance with the Project Plan and the Cashflow
Model;
|
| (f) |
representations
and warranties:
evidence that the representations and warranties set out in clauses
7.1
and 7.2
are true and correct;
|
| (g) |
Ratios:
the Cashflow Model provided under clause 2.1(g)
shows that the values of the Ratios are projected to be equal to,
or
higher than, the values for the Ratios set out in clause 8.25(a)
for the period up to the Final Repayment Date;
and
|
| (h) |
Promissory
Note:
the Borrower has delivered a Promissory Note to the Financier in
the
amount of the Funding
Portion.
|
| 2.3 |
Certified
copies
|
An
Officer of the relevant Transaction Party must certify a copy of a document
given to a Finance Party under clauses 2.1
or
2.2
to be a
true copy of the original document. The certification must be made no more
than
5 Business Days before the date on which it is provided.
| 2.4 |
Benefit
of conditions
precedent
|
A
condition in this clause 2
is for
the benefit only of the Finance Parties and only the Agent acting on the
instructions of the Financier may waive it.
| 3 |
Commitment,
purpose and availability of
Facility
|
| 3.1 |
Provision
of Commitment
|
The
Financier must make the Commitment available to the Borrower on the terms of
this agreement.
| 3.2 |
Purpose
|
The
Borrower must use the net proceeds of each Funding Portion under the Facility
only for:
| (a) |
firstly,
Distributions to AGI for the purpose of repayment in full of the
Secured
Debentures; and
|
page
24
|
3 Commitment,
purpose and availability of
Facility
|
| (b) |
secondly,
once the Secured Debentures have been repaid in full or the Financial
Indebtedness arising under those debentures has been converted in
full to
ordinary shares in APG:
|
|
(1)
|
the
general working capital purposes of the
Borrower;
|
|
(2)
|
the
making of Distributions by the Borrower;
and
|
|
(3)
|
any
other purpose that the Agent approves in
writing.
|
| 3.3 |
Cancellation
of Commitment during Availability
Period
|
| (a) |
The
Borrower may cancel any portion of the Undrawn Commitment by giving
the
Agent at least 10
days’ notice.
|
| (b) |
A
partial cancellation of the Undrawn Commitment may only be made in
an
integral multiple of US$500,000.
|
| (c) |
A
notice given under clause 3.3(a)
is
irrevocable.
|
| 3.4 |
Cancellation
at end of Availability
Period
|
On
the
last day of the Availability Period, the Commitment is cancelled to the extent
of the Undrawn Commitment.
| 3.5 |
Voluntary
prepayment
|
| (a) |
The
Borrower may prepay any of the Principal Outstanding by giving the
Agent
at least 10 days’
prior notice specifying
the prepayment date and the amount to be
prepaid.
|
| (b) |
Prepayment
of part of the Principal Outstanding may only be made in an integral
multiple of US$500,000.
|
| (c) |
The
Borrower must prepay the Principal Outstanding specified in the prepayment
notice on the prepayment date specified in the notice together with
all
unpaid interest accrued to the prepayment date in respect of the
prepaid
amount.
|
| (d) |
The
Commitment is reduced by any amount of Principal Outstanding prepaid
under
this clause 3.5
and accordingly a prepaid amount may not be
redrawn.
|
| (e) |
A
notice given under clause 3.5(a)
is
irrevocable.
|
| 3.6 |
Mandatory
prepayment
|
| (a) |
On
each Repayment Date, the Borrower must as a mandatory prepayment
of the
Principal Outstanding pay the lesser
of:
|
|
(1)
|
20%
of all Excess Cashflow for the preceding Quarter;
and
|
|
(2)
|
the
amount remaining in the Proceeds Account on the relevant Repayment
Date
after payment to the Financier of the Repayment Amount due on that
Repayment Date and interest, less US$1,000,000.
|
Clause
3.7(b)
will
apply to each mandatory prepayment.
| (b) |
The
Commitment is reduced by any amount of Principal Outstanding prepaid
under
this clause 3.6
and accordingly a prepaid amount may not be
redrawn.
|
| 3.7 |
Cancellations
and prepayments in inverse
order
|
| (a) |
If
there is a cancellation of the Undrawn Commitment under clause
3.3
the Repayment Amounts up to the amount of the cancellation are to
be
cancelled in inverse order of
maturity.
|
page
25
|
4 Funding
and rate setting procedures
|
| (b) |
A
prepayment under clause 3.5
or
3.6
is
to be applied to instalments of the Principal Outstanding in inverse
order
of maturity.
|
| 4 |
Funding
and rate setting procedures
|
| 4.1 |
Delivery
of Funding Notice
|
| (a) |
If
the Borrower requires the provision of a Funding Portion it must
deliver
to the Agent a Funding Notice and a Promissory Note for that Funding
Portion.
|
| (b) |
The
Agent must notify the Financier of the contents of each Funding Notice
as
soon as reasonably practicable and in any event within 1 Business Day
after the Agent receives the Funding
Notice.
|
| 4.2 |
Requirements
for a Funding Notice
|
A
Funding
Notice to be effective must be:
| (a) |
in
writing in the form of, and specifying the matters required in,
schedule 5; and
|
| (b) |
received
by the Agent before 11.00 am on a Business Day at least 4 Business
Days before the proposed Funding Date (or any shorter period that
the
Agent agrees in writing).
|
| 4.3 |
Irrevocability
of Funding Notice
|
The
Borrower is irrevocably committed to draw Funding Portions from the Financier
in
accordance with each Funding Notice given to the Agent.
| 4.4 |
Amount
of Funding Portions
|
The
Borrower must ensure that the amount of each Funding Portion is
either:
| (a) |
US$1,000,000
or an integral multiple of US$1,000,000;
or
|
| (b) |
equal
to the Undrawn Commitment.
|
| 4.5 |
Selection
of Interest Periods
|
| (a) |
Each
Interest Period must be of 30, 60 or 90
days or any other period that the Agent agrees with the
Borrower.
|
| (b) |
If
an Interest Period ends on a day which is not a Business Day, it
is
regarded as ending on the next Business Day in the same calendar
month or,
if none, the preceding Business
Day.
|
| (c) |
An
Interest Period for a Funding Portion commences either on the first
Funding Date for that Funding Portion or on the last day of the
immediately preceding Interest Period for that Funding
Portion.
|
| (d) |
Each
Interest Period which commences prior to a Quarterly Date and would
otherwise end after that Quarterly Date, ends on that Quarterly
Date.
|
| (e) |
No
Interest Period may end after the Final Repayment
Date.
|
page
26
|
5 Facility
|
| 4.6 |
Determination
of Funding Rate
|
| (a) |
The
Agent must notify the Financier and the Borrower of the Funding Rate
for
an Interest Period as soon as reasonably practicable, and in any
event
within 2 Business Days, after it has made its determination of
LIBOR.
|
| (b) |
In
the absence of manifest error, each determination of LIBOR by the
Agent is
conclusive evidence of that rate against the
Borrower.
|
| 5 |
Facility
|
| 5.1 |
Provision
of Funding Portions
|
If
the
Borrower gives a Funding Notice the Financier must pay into the Proceeds Account
the specified Funding Portion in Same Day Funds in United States Dollars on
the
specified Funding Date and in accordance with that Funding Notice.
| 5.2 |
Repayment
|
| (a) |
The
Borrower must repay the Principal Outstanding by paying on each Repayment
Date the lesser of:
|
|
(1)
|
the
Repayment Amount payable on that date as set out in the Repayment
Schedule; and
|
|
(2)
|
the
Principal Outstanding.
|
| (b) |
The
Commitment is reduced on each Repayment Date by the amount paid in
accordance with clause 5.2(a).
|
| 5.3 |
Repayment
of other Secured Moneys
|
| (a) |
The
Borrower must repay the balance of the Secured Moneys in full on
the dates
provided in the Transaction Documents, and all unpaid Secured Moneys
must
in all events be paid on or before the Final Repayment Date or on
any
other date which the Principal Outstanding is or is required to be
repaid
in full.
|
| (b) |
This
clause does not apply to Secured Money which is required to be
paid under
the terms of a Financier Hedging Agreement, payment of which will
be
determined in accordance with the terms of the relevant Financier
Hedging
Agreement.
|
| 5.4 |
Interest
|
| (a) |
The
Borrower must pay interest on the principal amount of each Funding
Portion
for each Interest Period at the Funding Rate for the Interest
Period.
|
| (b) |
The
Borrower must pay accrued interest in arrears to the Agent on account
of
the Financier on each Interest Payment
Date.
|
| 5.5 |
Calculation
of per annum interest rate
|
| (a) |
Interest
is calculated on daily balances on the basis of a 360 day year and
for the actual number of days elapsed from and including the first
day of
each Interest Period to, but excluding, the last day of the Interest
Period or, if earlier, the date of prepayment or repayment of the
Funding
Portion under this agreement.
|
page
27
|
6 Payments
|
| (b) |
Despite
anything contained in any Transaction Document, all of the Transaction
Documents are limited so that in no event will the total liability
for
payments in the nature of interest, additional interest and other
charges
exceed the applicable limits imposed by any applicable usury laws.
If any
payments in the nature of interest, additional interest and other
charges
made under any Transaction Document are held to be in excess of the
limits
imposed by any applicable usury laws, it is agreed that any amount
held to
be in excess will be considered payment of principal under this agreement,
and the indebtedness evidenced under this agreement will be reduced
by the
amount so that the total liability for payments in the nature of
interest,
additional interest and other charges will not exceed the applicable
limits imposed by that applicable usury law, in compliance with the
wishes
of the Borrower, the Guarantors, the Financier and the Agent. This
provision will never be superseded or waived, and will control every
other
provision of the Transaction Documents and all agreements between
the
Transaction Parties and the Finance Parties, and their successors
and
assigns.
|
| 6 |
Payments
|
| 6.1 |
Manner
of payment
|
All
payments by a Transaction Party under the Transaction Documents must be
made:
| (a) |
in
Same Day Funds;
|
| (b) |
in
United States Dollars; and
|
| (c) |
no
later than 11.00 am at the local time of the place where the account
specified by the Agent is located, on the due
date,
|
to
the
Agent’s account as specified by the Agent to the Borrower or in any other manner
the Agent directs from time to time. The Agent’s directions under this clause
6.1
may
require payments to be made in a manner that ensure they are received by the
Financier on the Repayment Date. Any account designated by the Agent under
this
clause 6.1
must be
maintained with a financial institution in the United States of
America.
| 6.2 |
Payments
on a Business Day
|
If
a
payment is due on a day which is not a Business Day, the due date for that
payment is the next Business Day in the same calendar month or, if none, the
preceding Business Day, and interest must be adjusted accordingly.
| 6.3 |
Payments
in gross
|
All
payments which a Transaction Party is required to make under any Transaction
Document must be without:
| (a) |
any
set-off, counterclaim or condition;
or
|
| (b) |
any
deduction or withholding for any Tax or any other reason unless the
Transaction Party is required to make a deduction or withholding
by
applicable law.
|
| 6.4 |
Additional
payments
|
If:
| (a) |
any
Transaction Party is required to make a deduction or withholding
in
respect of Tax (other than Excluded Tax) from any payment to be made
to a
Finance Party under any Transaction Document;
or
|
| (b) |
a
Finance Party is required to pay any Tax (other than Excluded Tax)
in
respect of any payment it receives from a Transaction Party or the
Agent
under any Transaction Document,
|
page
28
|
6 Payments
|
the
Transaction Party:
| (c) |
indemnifies
each Finance Party against that Tax;
and
|
| (d) |
must
pay to each Finance Party an additional amount which the Agent determines
to be necessary to ensure that each Finance Party receives when due
a net
amount (after payment of any Tax in respect of each additional amount)
that is equal to the full amount it would have received if a deduction
or
withholding or payment of Tax had not been
made.
|
| 6.5 |
Taxation
deduction procedures
|
If
clause 6.4(a)
applies:
| (a) |
the
Transaction Party must pay the amount deducted or withheld to the
appropriate Government Agency as required by law;
and
|
| (b) |
the
Transaction Party must:
|
|
(1)
|
use
reasonable endeavours to obtain a payment receipt from the Government
Agency (and any other documentation ordinarily provided by the Government
Agency in connection with the payment);
and
|
|
(2)
|
within
2 Business Days after receipt of the documents referred to in
clause 6.5(b)(1),
deliver copies of them to the
Agent.
|
| 6.6 |
Tax
Credit
|
If
a
Transaction Party makes an additional payment under clause 6.4
for the
benefit of a Finance Party, and the Finance Party determines that:
| (a) |
a
credit against, relief or remission for, or repayment of any Tax
(Tax
Credit)
is attributable to that additional payment; and
|
| (b) |
the
Finance Party has obtained, utilised and retained that Tax Credit,
|
then
the
Finance Party must pay an amount to the Transaction Party which the Finance
Party determines will leave it (after that payment) in the same after Tax
position as it would have been in had the additional payment not been made
by
the Transaction Party.
| 6.7 |
Tax
affairs
|
Nothing
in clause 6.6:
| (a) |
interferes
with the right of any Finance Party to arrange its tax affairs in
any
manner it thinks fit;
|
| (b) |
obliges
any Finance Party to investigate the availability of, or claim, any
Tax
Credit; or
|
| (c) |
obliges
any Finance Party to disclose any information relating to its tax
affairs
or any tax computations.
|
| 6.8 |
Amounts
payable on demand
|
If
any
amount payable by a Transaction Party under any Transaction Document is not
expressed to be payable on a specified date, that amount is payable by the
Transaction Party on demand by the Agent.
| 6.9 |
Appropriation
of payments
|
| (a) |
Except
where clause 6.9(b)
applies, all payments made by a Transaction Party under a Transaction
Document may be appropriated as between principal, interest and other
amounts as the Agent determines or, failing any determination, in
the
following order:
|
page
29
|
7 Representations
and warranties
|
|
(1)
|
first,
towards reimbursement of all fees, costs, expenses, charges, damages
and
indemnity payments due and payable by the Transaction Parties under
the
Transaction Documents;
|
|
(2)
|
second,
towards payment of interest due and payable under the Transaction
Documents; and
|
|
(3)
|
third,
towards repayment or prepayment of the Principal
Outstanding.
|
| (b) |
Any
money recovered by a Finance Party as a result of the exercise of
a Power
under a Security must be appropriated in the manner provided in that
Security.
|
| (c) |
Any
appropriation under clauses 6.9(a)
or
6.9(b)(b)
overrides any appropriation made by a Transaction
Party.
|
| 6.10 |
Currency
exchanges
|
If
the
Agent receives an amount under a Transaction Document in a currency which is
not
in the Relevant Currency, the Agent:
| (a) |
may
convert the amount received into the Relevant Currency in accordance
with
its normal procedures; and
|
| (b) |
is
only regarded as having received the amount that it has converted
into the
Relevant Currency.
|
| 7 |
Representations
and warranties
|
| 7.1 |
General
representations and
warranties
|
Each
Transaction Party represents and warrants to and for the benefit of each Finance
Party that:
| (a) |
registration:
|
|
(1)
|
the
Borrower and AGI are duly incorporated and validly existing under
the laws
of the State of Delaware, United States of America and the Borrower
is
duly qualified to do business, and is in good standing, in the State
of
Montana, United States of America;
and
|
|
(2)
|
APG
is registered (or taken to be registered) and validly existing under
the
laws of the Yukon Territory,
Canada,
|
and
each
of the Transaction Parties has done everything necessary to keep its corporate
existence in good standing;
| (b) |
corporate
power:
it has the corporate power to own its assets and to carry on its
business
as it is now being conducted;
|
| (c) |
authority:
it has power and corporate authority to enter into and perform its
obligations under the Documents to which it is expressed to be a
party;
|
| (d) |
authorisations:
it has taken all necessary corporate action to authorise the execution,
delivery and performance of the Documents to which it is a
party;
|
| (e) |
binding
obligations:
the Documents to which it is a party constitute its legal, valid
and
binding obligations and, subject to any necessary stamping and
registration, are enforceable in accordance with their terms subject
to
laws generally affecting creditors’ rights and to principles of
equity;
|
| (f) |
valid
Encumbrances:
|
|
(1)
|
on
execution and delivery of a Security, that Security will be effective
to
create in favour of the Finance Parties legal, valid and enforceable
Encumbrances on, and security interests in, all right, title and
interests
of the relevant Transaction Party (as the case may be) in and to
the
property the subject of that Security and the proceeds of that property;
and
|
page
30
|
7 Representations
and warranties
|
|
(2)
|
in
respect of a Security where the security interest may be perfected
only by
possession or control of the property the subject of that Security
(which
possession or control must be given to the Agent by the relevant
Transaction Party (as the case may be) to the extent that it is required),
after all appropriate filings or recordings are made in the appropriate
offices as may be required under applicable law, and, after the Agent
takes possession or control of the property the subject of that Security,
that Security will constitute a fully perfected Encumbrance on, and
first
priority security interests in, all right, title and interest of
that
Transaction Party in the property the subject of that Security and
the
proceeds of that property, in each case subject to no Encumbrances
other
than Permitted Encumbrances;
|
| (g) |
transaction
permitted:
the execution, delivery and performance by it of the Documents to
which it
is a party will not breach, or result in a contravention
of:
|
|
(1)
|
any
law, regulation or Authorisation;
|
|
(2)
|
its
memorandum and articles of association, articles of incorporation,
articles of organization, by-laws, constitution, operating agreement,
or
other constituent or constating documents, as applicable;
or
|
|
(3)
|
any
Encumbrance or agreement which is binding on
it,
|
and
will
not result in:
|
(4)
|
the
creation or imposition of any Encumbrance on any of its assets other
than
as permitted under a Transaction Document;
or
|
|
(5)
|
the
acceleration of the date for payment of any obligation under any
agreement
which is binding on it;
|
| (h) |
no
default or breach:
it is not:
|
|
(1)
|
in
breach in a material respect of any law or
Authorisation;
|
|
(2)
|
in
breach under any Document, agreement or other document binding on
it which
breach has, or is reasonably likely to have, a Material Adverse Effect;
and
|
|
(3)
|
in
default in the payment of a material sum, or in compliance with a
material
obligation in respect of Financial
Indebtedness;
|
| (i) |
no
litigation:
except for the ▇▇▇▇▇▇▇▇ Litigation, no litigation, arbitration, dispute
or
administrative proceeding has been commenced, is pending or to its
knowledge is threatened, which if adversely determined would have
a
Material Adverse Effect;
|
| (j) |
financial
information:
the most recent Financial Reports or accounts which APG and the Borrower
have provided to the Agent under clauses 2.1(f)
and 8.6:
|
|
(1)
|
give
a true and fair view of the financial condition and state of affairs
of
APG and its
Subsidiaries and the Borrower respectively, as at the date they were
prepared; and
|
|
(2)
|
were
prepared in accordance with the Accounting
Standards;
|
| (k) |
no
change in affairs:
there has been no change in the Borrower’s or APG’s
state of affairs since the end of the accounting period for its most
recent Financial Reports or accounts, referred to in
clause 7.1(j)
which has had, or is reasonably likely to have, a Material Adverse
Effect;
|
| (l) |
representations
true:
each of its representations and warranties contained in the Documents
is
correct and not misleading in all material respects when made or
repeated;
|
page
31
|
7 Representations
and warranties
|
| (m) |
disclosure:
|
|
(1)
|
no
representation or warranty of or by a Transaction Party under a
Transaction Document, any schedule, annexure or exhibit attached
to a
Transaction Document, contained in any certificate provided to a
Finance
Party pursuant to the provisions of a Transaction Document, contains
any
untrue statement of a material fact or omits to state a material
fact
necessary in order to make the statements in this agreement or in
that
Transaction Document, in the light of the circumstances under which
they
were made, not misleading;
|
|
(2)
|
it
has fully disclosed in writing to the Finance Parties all facts relating
to it, the Documents, the transactions contemplated by them, each
Transaction Party, the assets, business and affairs of each Transaction
Party and any thing in connection with them which would have had
or would
have been reasonably likely to have had a material effect on the
decision
of a prudent lender to enter into the Transaction Documents;
and
|
|
(3)
|
all
filings made by the Borrower with any securities commissions or regulatory
authorities or an Exchange are at their respective dates, true and
correct, contain or contained no misrepresentation and constitute
full,
true and plain disclosure of all material facts relating to the Borrower
and the Borrower does not have any confidential filings with any
securities commissions or regulatory authorities or an
Exchange;
|
| (n) |
legal
and beneficial owner:
it is the legal and beneficial owner of or has a valid leasehold
or other
contractual interest in:
|
|
(1)
|
its
Secured Property; and
|
|
(2)
|
all
of its assets included in the latest Financial Report provided by
APG,
|
free
and
clear of all third party rights, interests and Encumbrances other than those
disclosed in those Financial Reports, the MDOA, the MOOA or Permitted
Encumbrances, or Statutory Rights;
| (o) |
no
immunity:
it does not, nor do its assets, enjoy immunity from suit or
execution;
|
| (p) |
not
a trustee:
it does not enter into any Document as trustee of any trust or
settlement;
|
| (q) |
solvency:
it is solvent and is able to pay its debts as and when they become
due;
|
| (r) |
commercial
benefit:
the entering into and performance by it of its obligations under
the
Documents to which it is expressed to be a party is for its commercial
benefit and is in its commercial
interests;
|
| (s) |
shareholding:
|
|
(1)
|
the
issued share capital in the Borrower is 100 common fully paid
shares;
|
|
(2)
|
AGI
is the legal and beneficial owner of 100 common fully paid shares
in the
capital of the Borrower; and
|
|
(3)
|
APG
is the legal and beneficial owner of all issued shares in the capital
of
AGI;
|
| (t) |
Taxes
and fees:
|
|
(1)
|
it
has complied in all material respects with all tax laws in all applicable
jurisdictions and it has paid all Taxes due and payable by it (other
than
Contested Taxes), and no claims are being asserted against it in
respect
of any Taxes (other than Contested Taxes);
and
|
|
(2)
|
it
has paid all registration or other fees, costs and expenses in connection
with the execution, performance and perfection of the Documents,
any
transaction contemplated by a Document and any Authorisations;
and
|
page
32
|
7 Representations
and warranties
|
| (u) |
reporting
issuer:
APG is a reporting issuer (or the equivalent) where applicable
in good
standing in each of the provinces of Canada (except Quebec) under
the
applicable Securities Laws, is not included in a list of defaulting
reporting issuers maintained by the securities commissions (or
similar
regulatory authorities) in any of the provinces of Canada and is
not in
default of any requirement of the applicable Securities Laws relating
to
continuous disclosure and is in compliance with the by-laws, rules
and
regulations of the Toronto Stock Exchange.
|
| 7.2 |
Project
representations and
warranties
|
The
Transaction Parties represent and warrant to and for the benefit of each Finance
Party that:
| (a) |
Mineral
Rights:
|
|
(1)
|
the
Key Mineral Rights are legal, valid and
continuing;
|
|
(2)
|
the
Borrower is the legal and beneficial holder of the Mineral Rights
set out
in the Mortgage described at item 4 of schedule 3;
and
|
|
(3)
|
the
Borrower has in all material respects complied with its obligations
in
connection with the Key Mineral Rights to the extent required to
date;
|
| (b) |
Project
Authorisations:
|
|
(1)
|
the
Authorisations necessary for the development and operation of the
Project
are in place, except for any which as a matter of law or Good Industry
Practice cannot or should not reasonably be obtained until shortly
before
the events to which they relate occur where those events are not
imminent,
and it has no reason to believe that those Authorisations will not
be
obtained at the appropriate time in the future;
and
|
|
(2)
|
all
fees due and payable in connection with the Authorisations referred
to in
clause 7.2(b)(1)
have been paid;
|
| (c) |
Project
operation:
there has been no material change in the conduct or operation of
the
Project from that contemplated in the Cashflow Model and Project
Plan;
|
| (d) |
Project
Documents:
|
|
(1)
|
no
event has occurred or condition exists which would permit the
cancellation, termination, forfeiture or suspension of a Project
Document,
nor is any party to a Project Document in default under any term
of a
Project Document in any material
respect;
|
|
(2)
|
it
has given to the Agent copies of all of the Project Documents, and
all
copies of the Project Documents and any other documents or agreements
(including Authorisations) given by it or on its behalf to the Agent
constitute true and complete copies and those documents and agreements
are
in full force and effect; and
|
|
(3)
|
the
Project Documents contain the entire agreement of the parties to
them as
to the Project and
there are no other material contracts, agreements or arrangements
entered
into by a Transaction Party in connection with the
Project;
|
| (e) |
Project
Area:
the Project Area comprises all of the land, licences and other rights
which are required and necessary for the effective, proper and lawful
development and operation of the Project in accordance with the Cashflow
Model and the Project Plan;
|
| (f) |
environment:
|
|
(1)
|
the
development and operation of the Project and the Project Assets as
contemplated by the Project Plan and Cashflow Model complies with
all
applicable Environmental Laws in all material respects;
|
page
33
|
8 Undertakings
|
|
(2)
|
all
Environmental Approvals necessary for the development and operation
of the
Project as it is currently being operated are in place except for
any
which as a matter of law or Good Industry Practice cannot or should
not
reasonably be obtained until shortly before the events to which they
relate occur where those events are imminent and where it has no
reason to
believe that those Environmental Approvals will not be obtained at
the
appropriate time in the future; and
|
|
(3)
|
the
Environmental Bonding is the only environmental bonding required
to be
lodged in accordance with the requirements of any Environmental Law
relating to the Project or Project
Area;
|
| (g) |
royalties:
the only royalties, overriding royalties or production payments in
respect
of a Mineral Right are those royalties listed at items 1-9 (inclusive)
in
Part 5 of Paragraph 1.1 of Exhibit A of the MDOA;
|
| (h) |
other
business:
the Transaction Parties are not involved in and have not conducted
and do
not conduct any business other than exploration, mining and project
management , operation and development and activities incidental
to
exploration, mining and project management, operation and development;
and
|
| (i) |
insurances:
in respect of the Project and the Project Assets, the Transaction
Parties
have complied with clause 8.24
and all insurance policies entered into in complying with that clause
8.24
are valid, binding and subsisting and all premiums due under those
insurance policies have been paid in
full.
|
| 7.3 |
Survival
and repetition of representations and
warranties
|
The
representations and warranties given under this agreement:
| (a) |
survive
the execution of each Transaction Document;
and
|
| (b) |
are
repeated on the date of each Financier Hedging Agreement, each Funding
Date and each Quarterly Date with respect to the facts and circumstances
then subsisting until:
|
|
(1)
|
the
Commitment is cancelled; and
|
|
(2)
|
the
Secured Moneys are unconditionally repaid in
full,
|
or
the
Agent otherwise agrees in writing.
| 7.4 |
Reliance
by Finance Parties
|
Each
Transaction Party acknowledges that each Finance Party has entered into each
Transaction Document to which it is a party in reliance on the representations
and warranties given under this agreement.
| 8 |
Undertakings
|
| 8.1 |
Conduct
of Project
|
A
Transaction Party must not, without the written consent of the Agent, change
the
scope or operation of the Project from that assumed in or contemplated by the
Cashflow Model and the Project Plan and it must ensure that:
| (a) |
the
Project is diligently constructed, developed, equipped, operated
and
maintained in accordance with the Cashflow Model, the Project Plan,
Good
Industry Practice, Authorisations and in a manner which is intended
to
allow for production and delivery of Product on a regular basis and
in
sufficient quantities to satisfy its obligations under the Documents;
and
|
| (b) |
all
Project Assets are maintained in all material respects in good and
efficient operating condition, reasonable wear and tear and shutdowns
for
maintenance in the Ordinary Course of Business
excepted.
|
page
34
|
8 Undertakings
|
| 8.2 |
Project
Covenants
|
| (a) |
Project
Assets: The
Borrower must:
|
|
(1)
|
subject
to clause 8.2(a)(3),
own all Project Assets;
|
|
(2)
|
subject
to clause 8.2(a)(3),
ensure that no person other than itself has any right, title or interest
in the Project Assets other than as described in the MDOA, the MOOA,
under
a Permitted Encumbrance or by virtue of a statutory interest affecting
the
Mineral Rights or federal patents in favour of a Government Agency;
and
|
|
(3)
|
not
Dispose of, decrease or diminish any material portion of its interest
in
the Project Assets without the prior written consent of the
Agent.
|
| (b) |
Force
majeure:
Each Transaction Party must take all action as is reasonably open
to it to
cause any Force Majeure Event affecting the Project to be remedied
as soon
as possible after that Force Majeure Event occurs, but the party
affected
is not obliged to incur expenditure to overcome the events or
circumstances which caused the Force Majeure Event which would make
uneconomic (in the opinion of the Agent) the continued supply and
delivery
of Product.
|
| (c) |
Access:
Each Transaction Party must, at the request of the Agent, ensure
that the
Finance Parties and representatives of the Finance Parties on giving
reasonable notice are allowed at all reasonable times and with reasonable
frequency to have access to the Project Area and the Project Assets
to
inspect any of the Project Assets and to inspect any books, records,
data
and information which are in the custody or possession of a Transaction
Party; provided, however, those rights of access and inspection must
be
undertaken at a Finance Party’s own risk in a manner that does not
unreasonably disrupt the operation of the Project, and must be subject
to:
|
|
(1)
|
the
confidentiality provisions set out in this agreement or in any other
agreement between a Transaction Party and a Finance Party; and
|
|
(2)
|
applicable
health and safety laws and regulations and related policies adopted
by the
Borrower.
|
| (d) |
Project
Plan:
A
Transaction Party must not amend or change the Project Plan without
the
Agent’s prior written consent, that consent not to be unreasonably
withheld or delayed.
|
| 8.3 |
Provisions
relating to the MDOA
|
| (a) |
Where
the Borrower gives an undertaking under this agreement (or a Transaction
Party other than the Borrower gives an undertaking to procure the
Borrower
to perform that undertaking) with respect to the development or operation
of the Project or the Project Assets, the Borrower (or that other
Transaction Party) must use its Best Efforts to perform (or to procure
that the Borrower perform) that
undertaking.
|
| (b) |
Other
than:
|
|
(1)
|
cash
calls under an approved Program and Budget which are not Additional
Contributions (as those terms are defined in the MDOA);
|
|
(2)
|
expenditures
which the Borrower makes as the manager of the Project on behalf
of the
other participant pursuant to the MDOA;
|
|
(3)
|
its
share of Budget overruns of less than ten percent, as described in
section
9.8 of the MDOA; and
|
|
(4)
|
emergency
expenditures made in accordance with section 9.9 of the
MDOA,
|
where
under the terms of the MDOA the agreement of the Borrower (in its capacity
as a
participant in the Project, and not the manager of the Project) is required
for
any Project expenditure not contemplated by the Project Plan, the Borrower
will
give notice to the Agent of such expenditure. The Borrower will not agree to
the
relevant expenditure being incurred without the consent of the Agent, but the
Agent will not withhold its consent if it is satisfied (acting reasonably)
that
the incurring of the relevant expenditure will not result in:
page
35
|
8 Undertakings
|
|
(A)
|
a
breach of the either of the financial undertakings set out in clause
8.25(a);
or
|
|
(B)
|
the
Borrower being unable to make repayments or payments of principal,
interest or other amounts payable under this
agreement.
|
| 8.4 |
Environmental
issues
|
Each
Transaction Party must ensure that the Borrower:
| (a) |
complies
with all Environmental Laws with respect to the Project in all material
respects;
|
| (b) |
obtains
and complies with all Environmental Approvals required in connection
with
the development and operation of the Project, except for any failure
to
obtain an Environmental Approval which as a matter of law or Good
Industry
Practice cannot or should not reasonably be obtained until shortly
before
the events to which it relates occurs where not imminent;
and
|
| (c) |
promptly
notifies the Agent of all material claims, complaints or notices
concerning its compliance with Environmental Laws and Environmental
Approvals.
|
| 8.5 |
Mineral
Rights
|
Each
Transaction Party must ensure that:
| (a) |
the
Borrower has, and continues to have title to the Key Mineral
Rights;
|
| (b) |
the
Borrower takes, or procures to be taken, all action (including the
timely
payment of annual maintenance fees, recording of instruments, or
performance of annual assessment work, or otherwise) necessary to
ensure
that all conditions and requirements relating to the Key Mineral
Rights
are observed and performed and that the Key Mineral Rights remain
valid
and are in full force and effect;
|
| (c) |
the
Key Mineral Rights are free of Encumbrances other than Permitted
Encumbrances; and
|
| (d) |
the
Borrower uses its commercially reasonable best efforts to remedy
any
defect identified by the ▇▇▇▇▇▇▇ Title
Reports:
|
|
(1)
|
which
affects a Key Mineral Right (other than an Excluded Claim) within
60 days
of the provision of the initial Funding Portion, or if a Mineral
Right
which is not a Key Mineral Right as at the date of this agreement
becomes
a Key Mineral Right, within 60 days of it becoming so;
and
|
|
(2)
|
which
affects a Mineral Right (other than the Mineral Rights described
in clause
8.5(d)(1))
as soon as reasonably practicable, taking into account commercial
considerations and constraints.
|
Failure
to remedy a defect under clause 8.5(d)(1)
is not
an Event of Default if the relevant defect is demonstrated to the Agent’s
reasonable satisfaction not to materially affect the Borrower’s title to a Key
Mineral Right.
| 8.6 |
Corporate
budget
|
A
Transaction Party must not amend or change the Corporate Budget in any material
respect without the Agent’s prior written consent (not to be unreasonably
withheld or delayed).
page
36
|
8 Undertakings
|
8.7
Provision
of information and reports
Each
Transaction Party must ensure the Agent is provided with the following, which
must in the case of the information referred to in clauses 8.7(d),
8.7(e),
8.7(f)
and
8.7(g)be
in the
form and contain information satisfactory to the Agent:
(a)
Financial
Reports:
|
(1)
|
as
soon as practicable and no later than 120 days after the end of a
financial year, copies of the consolidated annual audited Financial
Report
of APG;
and
|
|
(2)
|
as
soon as practicable and no later than 45 days after each Quarterly
Date,
copies of the unaudited quarterly Financial Report of APG and the
Borrower
for the Quarter immediately preceding that Quarterly
Date;
|
(b)
Corporate
Budget:
no
later
than the date which is 30 days after 31 December of each year, a copy of the
proposed Corporate Budget for the subsequent 12 month period;
(c)
Project
Plan:
no
later than the date which is 30 days after 31 December of each year, a copy
of
the updated Project Plan for the subsequent 12 month period, including an
updated description of the Project life of mine and an updated reconciliation
of
Project mineral reserves. taking into account the operation of the Project
during the preceding 12 month period;
(d)
Project
reports:
promptly after delivery by the Manager, copies of the reports required under
section 8.2(p) and 10.1 of the MDOA and any other reports and information that
is provided by the Manager.
For the
avoidance of doubt, the parties agree that the report entitled “Montana Tunnels
Mine Joint Venture Monthly Report” as provided by the Borrower to the Agent is
in a form satisfactory to the Agent for the purposes of this clause 8.7(d)
and that
the Borrower will comply with this clause by providing a report in that form
on
each of the dates required under this clause;
(e)
metal
price protection report: no
later
than 30 days after the end of each calendar month, a metal price protection
report detailing the metal produced during that month, the amount of metal
committed under Hedging Agreements during that month and any Hedging Agreements
that have been terminated by delivery or close-out during that month;
(f)
Transaction
Accounts report:
no later
than 30 days after the end of each calendar month, a statement summarising
all
deposits to and withdrawals from the Transaction Accounts;
(g)
Quarterly
compliance certificate:
no
later than 30 days after each Quarterly Date, a certificate signed by at least
1
Officer of the Borrower stating:
|
(1)
|
each
of the Ratios as at the relevant Quarterly Date (giving details of
the
calculation of the Ratios);
|
|
(2)
|
any
non-compliance of a Transaction Party with a covenant in the Transaction
Documents and any Default that has occurred and is continuing;
and
|
|
(3)
|
the
full details of that non-compliance or Default and the remedial action
being taken or proposed to cure that non-compliance or Default;
and
|
(h)
other
information:
any
other information which the Agent reasonably
requests in relation to it, any of its assets or the Project.
8.8 Proper
accounts
Each
Transaction Party must:
(a)
keep
accounting records which give a true and fair view of its financial condition
and state of affairs; and
(b)
ensure
that the accounts it provides under clause 8.6
are
prepared in accordance with the Accounting Standards.
page
37
|
8
Undertakings
|
8.9
Notices
to the Agent
Each
Transaction Party must notify the Agent as soon as
is
reasonably practicable after it becomes aware of:
(a) any
Default occurring;
(b)
any
material breach of, or material default under, any Document to which it is
a
party;
(c)
any
material breach of any applicable license or law that would reasonably be
expected to affect the validity or good standing of the Project or the Project
Assets, the Borrower’s legal and beneficial title to the Project Assets or the
value of the Secured Property;
(d)
any
event
or circumstance which entitles a person to cancel, terminate or suspend any
Key
Mineral Rights, Environmental Approvals, Authorisations or a Project
Document;
(e)
any
change in statutory requirements that may have a material effect on mining,
metallurgical methods, tailings disposal, base metal production or title with
respect to the Project;
(f) a
revised
downward estimate of Proven Reserves and Probable Reserves in respect of the
Project other than as a result of mining;
(g)
a
material change in Key Personnel;
(h)
any
proposed changes to the Project Plan or the Project Documents;
(i)
Knight
Piésold Ltd. giving notice to a Transaction Party of matters of concern in
regard to the stability of the mine walls, ramps or slopes for the
Project;
(j)
any
unscheduled stoppage or disruption of ore mining or processing at the Project
for a period greater than 3 consecutive days;
(k)
any
material adverse change in the financial position of the Project, the Borrower
or another Transaction Party;
(l)
any
representation, warranty, action or statement made, or taken to be made, by
it
is or becomes false, misleading or incorrect in any material
respect;
(m)
any
intention by it to exercise any right, power or remedy under any Document to
which it is a party as a consequence of any default under it;
(n)
any
material breach of an Authorisation;
(o)
any
material breach of, or material claim being made against a Transaction Party
under, any Environmental Laws or Environmental Approvals;
(p)
any
material notices given or received by a Transaction Party under any Project
Document;
(q)
except
for the ▇▇▇▇▇▇▇▇ Litigation, any
litigation, arbitration, administration or other proceeding in respect of it
or
any of its assets being commenced or threatened which:
|
(1)
|
is
in excess of US$500,000 (or the equivalent amount in another currency);
or
|
|
(2)
|
if
adversely determined would have or be reasonably likely to have a
Material
Adverse Effect;
|
(r)
a
demand
under a Surety Obligation given by that Transaction Party;
(s) any
Encumbrance that exists over any of its assets other than a Permitted
Encumbrance;
| (t) |
any
material dispute between a Transaction Party and a Government Agency
or
any proposal of any Government Agency to compulsorily acquire a material
portion of its assets;
|
(u)
the
acquisition by it of a Subsidiary;
(v)
a
decision to accelerate or expand the level of production from the Project above
that contemplated in the Cashflow Model or Project Plan;
page
38
|
8
Undertakings
|
(w)
a
proposed change in mining or processing methods from those contemplated in
the
Cashflow Model or Project Plan in respect of the development or operation of
the
Project;
| (x) |
a
material change in the proposed arrangements, term or conditions
from
those contemplated in the Cashflow Model or Project Plan for the
sale of
Product;
|
| (y) |
any
replacement of a member of, or the addition of a member to, the senior
operating and corporate management team which manages the operations
of
the Project or the Borrower; and
|
(z) any
material disputes with respect to the Project, Project Area and the Project
Assets and any material dispute with landowners located in or around the Project
Area.
8.10 Corporate
existence
Each
Transaction Party must ensure that it:
(a)
does
everything necessary to maintain its corporate existence in good
standing;
(b)
does
not
transfer its jurisdiction of incorporation without the prior written consent
of
the Agent; and
(c)
does
not
enter into any merger, amalgamation, consolidation or reconstruction without
the
Agent’s prior written consent (not to be unreasonably withheld or
delayed).
8.11 Compliance
Each
Transaction Party must comply
with all its obligations under each Document to which it is a
party.
8.12 Maintenance
of capital
A
Transaction Party must not without the Agent’s prior written
consent:
(a)
call
up
or pass a resolution to call up its unpaid share capital;
(b)
reduce
or
pass a resolution to reduce its capital;
(c)
buy-back
or pass a resolution to buy-back, any of its shares;
or
(d)
attempt
or take any steps to do anything which it is not permitted to do under
clauses 8.12(a),
8.12(b)
or
8.12(c).
8.13 Compliance
with laws and Authorisations
Each
Transaction Party must:
(a)
comply
with, in all material respects, all laws and legal requirements, including
each
judgement, award, decision, finding or any other determination of a Government
Agency, which applies to it or any of its assets;
(b)
obtain,
maintain and comply with, in all material respects, all Authorisations
required:
|
(1)
|
for
the enforceability against it of each Document to which it is a party,
or
to enable it to perform its obligations under each Document to which
it is
a party;
|
|
(2)
|
in
relation to it or any of its assets;
and
|
|
(3)
|
for
the operation of the Project;
|
(c)
not
do
anything which would prevent the renewal of any Authorisation referred to in
clause 8.13(b)
or cause
it to be renewed on less favourable terms.
page
39
|
8
Undertakings
|
8.14
Payment
of debts, outgoings
and Taxes
| (a) |
Each
Transaction Party must pay or cause to be paid its debts and financial
obligations including all rates, rents and other outgoings when due
and
payable, except where that Transaction Party is contesting its liability
to pay that financial obligation, and has reasonable grounds to do
so, in
appropriate proceedings reasonably satisfactory to the
Financier.
|
(b)
Each
Transaction Party must pay or cause to be paid all Taxes when due, other than
Contested Taxes.
(c)
Each
Transaction Party must set aside sufficient reserves to cover any Contested
Taxes.
(d)
Each
Transaction Party must pay or cause to be paid all Contested Taxes when the
terms of any final determination or settlement require those Contested Taxes
to
be paid, unless failure to pay any Contested Taxes when due may have a Material
Adverse Effect, in which case those the Contested Taxes must be paid when due.
8.15 Project
Documents
(a)
A
Transaction Party must not without the prior written consent of the
Agent:
|
(1)
|
materially
amend or vary, or agree to a material amendment or variation
of;
|
|
(2)
|
terminate,
rescind or discharge (except by performance or unless replaced on
terms no
less favourable to that Transaction
Party);
|
|
(3)
|
grant
any waiver, time or indulgence in respect of any material obligation
under;
|
|
(4)
|
do
or omit to do anything which may adversely affect the provisions
or
operation of; or
|
|
(5)
|
do
or omit to do anything which would give any other person legal or
equitable grounds to do anything in clause 8.15(a)(1)
to
(4)
in
respect of,
|
any
Project Document to which it is a party.
(b)
Each
Transaction Party must do all things necessary to enforce all of its rights,
powers and remedies under each Project Document to which it is a
party.
(c)
A
Transaction Party must not enter into any agreement (other than Material
Agreements existing as at the date of this agreement) relating to the
development and construction of the Project, the refinement or treatment of
Product or any other agreement or contract which relates to the
Project
where
the aggregate amount of payments to be made under that agreement or contract
is
anticipated to exceed US$1,000,000, without the prior written consent of the
Agent.
(d)
The
Borrower and APG must comply with all of their respective obligations under
the
Services Agreement.
8.16 Amendments
to constitution
A
Transaction Party must not amend its memorandum and articles of association,
articles of incorporation, articles of organization, by-laws, constitution,
operating agreement, or other constating documents (as applicable) without
the
Agent’s prior written consent, which consent must not be unreasonably withheld
or delayed.
8.17 Negative
pledge and disposal of assets
(a)
A
Transaction Party must not create or allow to exist or agree to any interest
or
Encumbrance over any of its assets other than a Permitted
Encumbrance.
(b)
A
Transaction Party must not without the prior written consent of the Agent
Dispose of any of its assets other than:
page
40
|
8
Undertakings
|
|
(1)
|
a
Disposal (which is not a Disposal of a Project Asset) of an asset
which is
sold in the Ordinary Course Business and at market value where the
aggregate of assets sold by all Transaction Parties in the preceding
12
month period is less than US$500,000;
or
|
| (2) |
a
Disposal of Product; or
|
|
(3)
|
a
Disposal for valuable consideration and on arm’s length commercial terms
of assets that are no longer required for the proper and efficient
operation of the Project because:
|
| · |
of
replacement, obsolescence or otherwise, and where the Disposal relates
to
the replacement of assets, the asset is replaced with one or more
assets
having a similar function or comparable or superior type, value and
quality; or
|
| · |
of
cessation of mining operations at the Project in accordance with
the
Project Plan; or
|
|
(4)
|
the
Disposal of the MTM Mill (as that term is defined in the MOOA) under
the
MOOA.
|
| (c) |
A
Transaction Party must not enter into any arrangement under which
money or
the benefit of a bank or other account may be applied, set-off or
made
subject to a combination of accounts, except for a netting or set-off
arrangement in the ordinary course of its ordinary banking arrangements
for the purpose of netting debit and credit
balances.
|
(d)
A
Transaction Party must not enter into any arrangement which, if complied with,
would prevent any Transaction Party from complying with its obligations under
the Transaction Documents.
(e)
APG
must
not Dispose of any shares it owns in AGI without the prior written consent
of
the Financier.
(f)
AGI
must
not Dispose of any shares it owns in the Borrower without the prior written
consent of the Financier.
(g)
No
Transaction Party may Dispose of any Inter-Company Claims owing to it by another
Transaction Party.
8.18 No
change to business
APG:
(a)
must
ensure that its business is operated in accordance with the Corporate Budget;
and
(b)
must
not
engage in any business other than, or do anything which would result in
substantial changes to, its existing core businesses and operations of mineral
exploration, mining or processing, except with the prior written consent of
the
Agent.
8.19 Financial
accommodation
and Financial Indebtedness
(a)
A
Transaction Party must not subscribe for capital in an entity, provide any
financial accommodation, or give any Surety Obligation in respect of any
financial accommodation, to or for the benefit of any Person, other than
Permitted Financial Accommodation.
(b)
A
Transaction Party must not incur any Financial Indebtedness other than Permitted
Financial Indebtedness.
8.20 Arm’s
length transactions
A
Transaction Party must not:
(a)
enter
into an agreement with any Person;
page
41
|
8
Undertakings
|
(b) acquire
or Dispose of an asset;
(c) obtain
or
provide a service;
(d) obtain
a
right or incur an obligation; or
(e) implement
any other transaction,
unless
it
does so on terms which are no less favourable to it than arm’s length
terms.
8.21 No
Subsidiaries
The
Borrower must not incorporate any new Subsidiary (whether wholly-owned or
otherwise) without the prior written consent of the Agent (not to be
unreasonably withheld or delayed).
8.22 Restrictions
on Distributions
and fees
A
Transaction Party must not:
(a)
make
any
Distribution other than a Distribution made in accordance with clause
3.2
which
would not result in a violation of clauses 8.25
and
10.3(b);
or
(b)
pay
any
director fees, management fees, consultancy fees or other like payments to
any
director or Affiliate of a Transaction Party unless those fees or other payments
are:
|
(1)
|
reasonable
and are no more or less favourable than it is reasonable to expect
would
be the case if the relevant persons were dealing with each other
at arm’s
length; or
|
|
(2)
|
paid
with the Agent’s prior consent.
|
8.23 Undertakings
regarding Secured Property
Each
Transaction Party must:
(a)
maintenance
of the Secured Property:
subject
to clause 8.17:
|
(1)
|
maintain
and protect its Secured Property;
|
|
(2)
|
keep
its Secured Property in a good state of repair and in good working
order
allowing for fair wear and tear and shutdowns for maintenance in
the
Ordinary Course of Business;
|
|
(3)
|
remedy
every defect in its title to any part of its material Secured Property
(including the Key Mineral Rights);
|
|
(4)
|
take
or defend all legal proceedings to protect or recover any of its
Secured
Property;
and
|
|
(5)
|
keep
its Secured Property valid and subsisting and free from liability
to
forfeiture, cancellation, avoidance or
loss;
|
(b)
further
security:
|
(1)
|
do
anything which the Agent reasonably requests to
maintain the priority of its Security, or secures to the Financier
its
Secured Property in a manner consistent with any provision of any
Transaction Document, or aids in the exercise of any Power of a Finance
Party, including, the execution of any document or the execution
and
delivery of blank transfers;
|
|
(2)
|
when
the Agent requests, execute a legal or statutory mortgage in favour
of the
Financer over the Borrower’s right, title and interest in any real
property acquired by it on or after the date of this agreement in
form and
substance required by the Agent, but the Agent cannot require an
obligation which is more onerous than any obligation contained in
any
Transaction Document;
|
page
42
|
8
Undertakings
|
|
(3)
|
use
its best efforts to record any mortgage executed under
clause 8.23(b)(2);
and
|
|
(4)
|
if
a Transaction Party acquires any material
assets:
|
| · |
promptly
notify the Agent of that acquisition;
and
|
| · |
at
the request of the Agent, procure the company that has acquired those
assets to grant security over those assets in favour of a Finance
Party in
form and substance required by the Agent, but the Agent cannot require
an
obligation which is more onerous than any obligation contained in
any
Transaction Document;
|
(c)
registration
and protection of security:
ensure
that its Security is registered, recorded, and filed in all registers in all
jurisdictions in which it must be registered, recorded and/or filed to ensure
the enforceability, validity and priority of the Security against all persons
and to be effective as a security;
(d)
no
partnership or joint venture:
not
enter into any profit sharing arrangement in relation to its Secured Property
or
any partnership or joint venture with any other person without the Agent’s
written consent, other than the MDOA and the MOOA and as disclosed in the
MDOA;
(e)
no
Encumbrances:
cause
any Encumbrance other than a Permitted Encumbrance which is lodged in respect
of
its Secured Property, other than an Encumbrance lodged by the Finance Parties,
to be removed as soon as reasonably practicable but in any event within
15 Business Days after the date that it becomes aware of its existence;
and
(f)
Offtake
Agreement:
if
requested by the Agent, use its commercially reasonable best efforts to procure
consent from Teck Cominco with respect to the assignment of the Offtake
Agreement to the Finance Parties.
8.24 Insurance
(a)
General
requirements:
Each
Security Provider must ensure that all aspects of the Current Insurance Policies
are maintained.
(b)
Payment
of premiums:
Each
Security Provider must punctually pay all premiums and other amounts necessary
to effect and maintain in force each insurance policy.
(c)
Contents
of insurance policy:
Each
Security Provider must use commercially reasonable best efforts to ensure that
every insurance policy (other than worker’s compensation, directors’ and
officers’ liability and public liability):
|
(1)
|
is
taken out in the name of the Security Provider, notes each Finance
Party
as an additional insured and insures each of their insurable
interests;
|
|
(2)
|
names
the Agent as the loss payee;
|
|
(3)
|
cannot
be terminated or varied by the insurer for any reason including the
non-payment of the premium or any other amount in respect of the
insurance
policy, unless the Agent is given 30 days prior written notice;
and
|
|
(4)
|
provides
that notice of any occurrence given by one insured party will be
regarded
as notice given by all insured parties and that failure by one insured
party to observe and fulfil the conditions of the policy will not
prejudice the rights of any other insured
party.
|
(d)
No
prejudice:
Each
Security Provider must not do or omit to do, or allow or permit to be done
or
not done, anything which may materially prejudice any insurance
policy.
(e)
Deliver
documents:
Each
Security Provider must promptly deliver to the Agent:
|
(1)
|
adequate
evidence as to the existence and currency of the insurance required
under
this clause 8.24;
and
|
page
43
|
8
Undertakings
|
|
(2)
|
any
other detail with respect to the insurance which the Agent may reasonably
require and notify to the Security Provider from time to
time.
|
(f)
No
change to policy:
A
Security Provider must not rescind, terminate, cancel or make a material change
to any insurance policy without the Agent’s written consent, except where the
variation is to increase coverage, the amount insured by the policy or amend
the
scheduled insured property where that amendment results from a Disposal
permitted under clause 8.17.
(g) Assistance
in recovery of money:
Each
Security Provider must do all things reasonably required by a Finance Party
to
enable the Finance Party to recover any money due in respect of an insurance
policy.
| (h) |
Notification
by Security Provider:
Each Security Provider must notify the Agent as soon as reasonably
practicable after it becomes aware
of:
|
|
(1)
|
an
event which in relation to a Security Property gives rise to a claim
of
US$500,000 or more under an insurance policy;
and
|
|
(2)
|
the
cancellation or variation for any reason of any insurance policy
in
relation to its Secured Property.
|
(i)
Dealing
with insurance policy proceeds:
|
(1)
|
If
the claim by a Transaction Party is greater than US$1,000,000, or
if the
claim by a Transaction Party is less than US$1,000,000 but the Agent
determines that there is not sufficient business interruption insurance
or
other funds available to the Borrower to ensure that the Borrower
can pay
or repay any part of the Secured Moneys due and payable by it,
the
Agent may direct that Transaction Party with respect to a particular
insurance claim, to irrevocably authorise, instruct and direct the
insurer
to pay the proceeds of that claim up to the amount of the Secured
Moneys
to the Financier.
|
|
(2)
|
If
an Event of Default has occurred and is continuing, the proceeds
in
respect of any insurance policy must be used to repay the Secured
Moneys
outstanding at that time or for any other purpose which the Agent
approves.
|
|
(3)
|
The
proceeds in respect of any claim under an insurance policy in respect
of
lost, destroyed or damaged property of a Transaction Party that are
not
being applied in accordance with clauses 8.24(i)(1)
and 8.24(i)(2),
must be applied towards the replacement or reinstatement of that
property.
|
|
(4)
|
Clauses 8.24(i)(1),
8.24(i)(2)and
(3)
do
not apply to proceeds received from any workers’ compensation or public
liability policy to the extent that the proceeds are paid to a person
entitled
to be compensated under the workers’ compensation or public liability
policy.
|
|
(5)
|
Any
amount received by the Agent in accordance with clauses 8.24(i)(1)
or
8.24(i)(2)
may be applied by the Agent as a prepayment of the Principal Outstanding,
and clauses 3.5(d)
and 3.7(b)
will apply to the prepayment.
|
(j)
Power
to take proceedings:
If an
Event of Default has occurred and is continuing and a Receiver has not been
appointed, the Agent alone has full power to make, enforce, settle, compromise,
▇▇▇ on and discharge all claims and recover and receive all moneys payable
in
respect of any claim under any insurance policy.
8.25 Financial
undertakings
(a)
The
Borrower must ensure that at all times:
|
(1)
|
the
LLCR is not less than 1.5:1;
and
|
|
(2)
|
the
PLCR is not less than 2:1.
|
(b)
If
the
Quarterly compliance certificate provided by Borrower in accordance with clause
8.7(g)
shows
that, or if at any time the Agent calculates that, the value of a Ratio is
less
than the value for that Ratio set out in clause 8.25(a),
the
Borrower must on the next Repayment Date apply as a mandatory prepayment of
the
Principal Outstanding the lesser of:
page
44
|
8
Undertakings
|
|
(1)
|
100%
of the Excess Cashflow; and
|
|
(2)
|
the
amount that is required to be paid to make the value of that Ratio
greater
than or equal to the value for that Ratio set out in clause 8.25(a).
|
Clauses
0
and
3.7(b)
will
apply to each mandatory prepayment.
(c)
The
calculation of a Ratio by the Agent is, in the absence of manifest error, the
final and agreed calculation of that Ratio. In calculating a Ratio, the Agent
will have regard to the most recent Cashflow Model and information provided
to
it under clause 8.6.
8.26 Hedging
(a)
Each
Transaction Party must ensure that the Borrower enters into and maintains the
Metals Price Protection Program to the satisfaction of the Agent.
(b)
A
Transaction Party must not enter into a Hedging Agreement in respect of Product
with a counterparty who is not the Financier.
8.27 Repayment
of Secured Debentures and RMB GSA
(a)
The
Transaction Parties must ensure that APG repays when due all amounts outstanding
under each of the Secured Debentures.
(b) As
soon
as practicable, but no more than 15 Business Days after repayment of the Secured
Debentures in accordance with clause 8.27(a),
the
Transaction Parties must:
(1) procure
the full discharge and release of the Canadian Securities;
(2) ensure
APG:
| · |
executes and delivers to the Agent the RMB GSA;
and
|
·
executes
any other forms or documents required to perfect the security under the RMB
GSA
and evidence of APG’s corporate authorisation of the RMB GSA,
each
in
form and substance satisfactory to the Agent; and
|
(3)
|
procure
delivery of a legal opinion on enforceability of the RMB GSA and
due
execution of it by APG in form and substance satisfactory to the
Agent.
|
8.28 Subordination
(a) Each
Transaction Party must ensure that:
|
(1)
|
all
the Inter-Company Claims and payment (from whatever source) of, and
the
rights and claims of each Transaction Party in respect of, all the
Inter-Company Claims are subordinated and postponed and made subject
in
right of payment to all the Secured Moneys and payment (from whatever
source) of, and the rights and claims of the Finance Parties in respect
of, all the Secured Moneys;
|
|
(2)
|
until
all the Secured Moneys have been paid in
full:
|
·
the
Inter-Company Claims must not (without the prior written consent of the Agent)
be paid or repaid; and
·
no
Transaction Party may receive, and each Transaction Party must not pay or repay,
any of the Inter-Company Claims to, or at the direction of, another Transaction
Party or any person acting, or purporting to act, on behalf of a Transaction
Party;
page
45
|
9 Cashflow
Model
|
|
(3)
|
the
subordination effected by this clause applies at all times including
if
and while a Transaction Party is in
liquidation;
|
|
(4)
|
if,
on liquidation of a Transaction Party, there is a distribution of
a
Transaction Party's assets including payment in cash, property or
securities, to creditors of that Transaction Party on liquidation,
all of
the Secured Moneys must be paid in full in cash before a payment
is made
for or on account of the Inter-Company Claims;
and
|
|
(5)
|
until
the Secured Moneys and all moneys due or owing under the Transaction
Documents have been paid in full, until the subordination under this
clause has been terminated and until this agreement has been fully
discharged, no Transaction Party
may:
|
·
make
a
claim or exercise a right, power or remedy against another Transaction Party
under any agreement, document or otherwise;
·
accept,
or ensure the grant of, or permit any Encumbrance or Guarantee from a
Transaction Party or any surety in favour of another Transaction Party to
exist;
·
exercise,
or attempt to exercise, any right of set-off against, nor realise any
Encumbrance from, a Transaction Party or any surety; or
·
raise
any
defence or counterclaim in reduction or discharge of any obligation owed by
a
Transaction Party to another Transaction Party or any surety.
(b) Despite
clause 8.28(a),
a
Transaction Party (“First Transaction Party”) may reimburse or indemnify another
Transaction Party (“Second Transaction Party”) for costs and expenses incurred
by the Second Transaction Party on behalf of the First Transaction Party in
the
Ordinary Course of Business if at the time of the payment no Default has
occurred and is continuing.
8.29 Term
of undertakings
Unless
the Agent otherwise agrees in writing, until:
(a)
the
Commitment is cancelled; and
(b)
the
Secured Moneys are unconditionally repaid in full; and
each
Transaction Party must, at its own cost, comply with its undertakings in this
clause 8.
9
Cashflow
Model
9.1 Calculations
Any
amount or figure to be calculated or estimated under or for the purposes of
the
definitions of “Loan Life Cover Ratio”, “Project Life Cover Ratio”, “Operating
Costs” and “Revenue” is to be calculated by the Agent or, at the request of the
Agent, by the Borrower on the basis of the latest Cashflow Model and accounts
and other financial information provided under clause 8.6
or, if
the Borrower or the Guarantor is at any relevant time in default in delivering
accounts and other financial information under clause 8.6,
as
estimated by the Agent on the basis of the latest Cashflow Model and other
accounts and information available to the Agent.
page
46
|
9 Cashflow
Model
|
9.2
Calculations
in United States Dollars
All
calculations under this agreement will be made in United States Dollars. For
the
purpose of determining Operating Costs and Revenue for any period, any amount
paid or received by the Borrower in a currency other than United States Dollars
will:
(a)
to
the
extent the amount paid or received has been converted from or to United States
Dollars by the Borrower, be taken into account as that United States Dollar
amount; and
(b)
to
the
extent that no conversion has taken place, be taken into account as the amount
of United States Dollars converted from that other currency at the spot rate
for
the purchase of United States Dollars with that currency quoted by the Agent
at
or about 8.00 am on the last day of the period.
9.3
Maintenance
The
Cashflow Model will be maintained and updated regularly by the Borrower until
the Final Repayment Date.
9.4
Update
of Cashflow Model
In
addition to the Quarterly updates of the Cashflow Model described in clause
9.6
the
Agent may, and the Borrower will at the request of the Agent, update the
Cashflow Model in the following circumstances:
(a)
at
any
time to reflect any changes to the Project Plan agreed to by the
Agent;
(b) at
any
other time to reflect any material changes in the technical assumptions or
economic assumptions for the Cashflow Model, determined by the Agent in its
reasonable discretion.
9.5
Factors
since commencement of production
Any
updating of the Cashflow Model under clause 9.4
or
9.6
will
take into account:
(a)
actual
Revenue and Operating Costs; and
(b)
actual
performance of the Project,
during
the term of the Facility.
9.6
Delivery
of updated Cashflow Model
(a)
A
copy of
any updated Cashflow Model must promptly be delivered:
| (b) |
by
the Borrower to the Agent, along with the Quarterly compliance certificate
described under clause 8.7(g)
on
each Quarterly Date; and
|
(c)
by
the
Agent to the Borrower promptly following any update or revision made by the
Agent.
9.7
Determination
is binding
(a)
The
technical assumptions, economic assumptions and other terms of the Cashflow
Model under this clause 9
will be
determined by the Agent (acting reasonably), and, absent manifest error, a
determination by the Agent (acting reasonably) is final and binding on the
Transaction Parties.
(b)
If
so
requested by the Borrower, the Agent must hold discussions with the Borrower
in
good faith regarding the terms of the Cashflow Model and any update or proposed
update of the Cashflow Model, and the economic assumptions and technical
assumptions to be used in the Cashflow Model.
page
47
|
10 Transaction
Accounts
|
10
Transaction
Accounts
10.1 Establishment
of Transaction Accounts
The
Borrower covenants and agrees with the Agent:
(a)
to
establish and maintain 2 United States Dollars denominated interest bearing
accounts located in the United States of America in a place and with a bank
or
financial institution reasonably acceptable to the Agent, those accounts to
be
called
respectively:
|
(1)
|
the
“Montana Tunnels Mine - Operating Account”;
and
|
|
(2)
|
the
“Montana Tunnels Mine - Proceeds
Account”;
|
(b)
to
maintain the Transaction Accounts in the location and with the bank or financial
institution at which that account was originally established and not change
that
account to another bank or financial institution without the Agent’s prior
written consent;
(c)
to
cause
all interest and other earnings on a Transaction Account to be credited to
that
Transaction Account; and
(d) to
deal
with the amounts standing to the credit of a Transaction Account in accordance
with this clause 10
and not
otherwise.
10.2 Project
Operating Account
The
Borrower must:
(a)
deposit,
or cause to be deposited, into the Project Operating Account all money received
in connection with the Project (including proceeds of sales of assets and
insurance proceeds); and
(b)
operate
that account in accordance with Good Industry Practice and in accordance with
the MDOA.
10.3 Proceeds
Account
(a)
The
Borrower must deposit, or cause to be deposited, into the Proceeds
Account:
|
(1)
|
all
of the Borrower’s entitlement under the MDOA to all amounts deposited into
the Project Operating Account in accordance with clause 10.2(a);
and
|
|
(2)
|
the
proceeds of all Funding Portions.
|
(b)
The
Borrower must not make any withdrawal
from the Proceeds Account for any purpose unless:
|
(1)
|
no
Default or Review Event has occurred and is continuing, or would
occur as
a result of making that withdrawal;
and
|
|
(2)
|
the
funds remaining in the Proceeds Account after that withdrawal, are
in
aggregate equal to or greater than
US$1,000,000.
|
So
long
as clauses 3.2
and
10.3
would
not be violated, the Borrower may withdraw funds from the Proceeds Account
at
any time and for any reason.
10.4 Limit
on withdrawals
(a)
If
an
Event of Default has occurred and while it is continuing, withdrawals from
a
Transaction Account may only be made with the prior written approval of the
Agent or a Receiver appointed by the Agent.
page
48
|
11 Events
of Default
|
(b)
If
a
Potential Event of Default or Review Event has occurred and while it is
continuing, withdrawals from a Transaction Account may be made with the prior
written approval of the Agent (that approval not to be unreasonably withheld
or
delayed).
11 Events
of
Default
11.1 Events
of Default
It
is an
Event of Default, whether or not it is within the control of a Transaction
Party, if:
(a)
failure
to pay:
a
Transaction Party fails to pay or repay any part of the Secured Moneys when
due
and payable by it;
(b)
non-remediable
failure:
a
Transaction Party fails to perform any undertaking or obligation of it under
any
Transaction Document (other than as described in paragraph 11.1(a)or
a
failure to perform clause 8.25(a))
and
that failure is not
in the
opinion of the Agent remediable;
(c)
remediable
failure:
the
failure described in clause 11.1(b)
is
in the
opinion of the Agent remediable, and the Transaction Party does not remedy
the
failure within 15 Business
Days after the Transaction Party becomes aware of that failure or receives
a
notice from the Agent specifying the failure (whichever occurs
earliest);
(d)
Mineral
Rights:
|
(1)
|
a
Key Mineral Right is terminated or otherwise ceases to be in full
force
and effect; or
|
|
(2)
|
a
Key Mineral Right is abandoned, terminated or otherwise determined
in the
opinion of the Agent to be invalid or owned by a person other than
the
Borrower or EKT.
|
The
parties specifically agree that the imposition of a Federal Royalty will not
be
an Event of Default;
(e)
Ratios:
the
Agent calculates, having regard to the most recent Cashflow Model, that as
at
any Calculation Date:
|
(1)
|
the
LLCR is less than 1.2:1; or
|
|
(2)
|
the
PLCR is less than 1.5:1;
|
(f)
Project
Documents:
any
party to a Project Document (other than EKT in respect of the MDOA) fails to
perform or observe, in any material respect, any of its material undertakings
or
obligations under a Project Document and that party does not remedy the failure
within the grace period stated in the Project Document or, if no grace period
is
stated, within 15 Business Days;
(g)
Authorisations:
the
Borrower fails to maintain and comply in all material respects with all
applicable Authorisations that relate to the development, construction and
operation of the Project and such failure has had, or is reasonably likely
to
have, a Material Adverse Effect;
(h)
abandonment:
all or
any material part of the Project is abandoned or placed on a “care and
maintenance” basis for more than 5 consecutive days;
(i)
destruction
of Secured Property:
all or
a material part of the Secured Property is destroyed, lost or damaged beyond
repair or proves to be materially defective in circumstances not covered fully
by any insurance in favour of a Transaction Party;
(j)
expropriation:
all or
a material part of the Secured Property is seized, nationalised, compulsorily
acquired or expropriated by, or by order of, a Government Agency or under any
law or a Government Agency orders the sale, vesting or divesting of all or
a
material part of the Secured Property, or a restraint, restriction, prohibition,
intervention, law, decree or other order of a Government Agency or any other
matter or thing occurs which wholly or partially prevents or
hinders:
page
49
|
11 Events
of Default
|
|
(1)
|
the
performance by a Transaction Party of any of its obligations under
a
Document; or
|
|
(2)
|
the
construction, development or operation of the Project or the Project
Assets;
|
(k)
misrepresentation:
any
representation or warranty or statement made, or taken to have been made, of
a
Transaction Party under or in connection with a Transaction Document is found
to
have been incorrect or misleading when made or repeated, or taken to have been
made or repeated, unless rectified within 20 Business Days of that
representation or warranty or statement having been made or taken to have been
made;
(l)
acceleration
of payments:
a
Transaction Party does anything which constitutes an event, whatever called,
which causes or enables the acceleration of a payment to be made under a
Document, or the enforcement or termination or recision of a
Document;
(m)
cross
default:
any
Financial Indebtedness of a Transaction Party in an amount in excess of
US$500,000:
|
(1)
|
becomes
due and payable, or becomes capable of being declared due and payable,
before the scheduled date for payment;
or
|
|
(2)
|
is
not paid when due (after taking into account any applicable grace
period);
|
(n)
Encumbrance:
any
Encumbrance is enforced, or becomes capable of being enforced, against a
material asset of a Transaction Party;
(o)
judgment:
a
judgment in an amount exceeding US$500,000 is obtained against a Transaction
Party and that judgement has not been paid and satisfied, vacated, discharged,
stayed or bonded pending appeal within 15 Business
Days from the entry of that judgment;
(p)
execution:
a
distress, attachment, execution or other process of a Government Agency is
issued against, levied or entered upon an asset of a Transaction Party in an
amount exceeding US$500,000 and is not set aside or satisfied within
15 Business
Days;
(q)
winding
up:
any of
the following occur:
|
(1)
|
an
application is made;
|
|
(2)
|
an
order is made; or
|
|
(3)
|
a
resolution is passed
or
any steps are taken to pass a
resolution,
|
for
the
winding up of any Transaction Party;
(r)
administration,
liquidation, receivership etc:
any of
the following occur:
|
(1)
|
an
administrator, liquidator, provisional liquidator, receiver, receiver
and
manager, official manager, trustee, controller or similar official
is
appointed,
or any steps are taken to that appointment;
or
|
|
(2)
|
a
resolution to appoint an administrator, liquidator, provisional
liquidator, receiver, receiver and manager, official manager, trustee,
controller or similar official is passed,
or any steps are taken to pass a resolution to that
appointment,
|
to
a
Transaction Party or over the assets of a Transaction Party;
(s)
deregistration:
a
Transaction Party is deregistered, or any steps are taken to deregister a
Transaction Party under any applicable law;
(t)
suspends
payment:
a
Transaction Party suspends payment of its debts generally;
(u) insolvency:
a
Transaction Party:
|
(1)
|
is
unable to pay its debts when they are
due;
|
|
(2)
|
states
that it is insolvent or unable to pay its debts when they are due;
or
|
page
50
|
11 Events
of Default
|
|
(3)
|
is
presumed to be insolvent or becomes insolvent under administration
as
defined or recognised under any applicable law, or action is taken
which
could result in those events;
|
(v)
arrangements:
a
Transaction Party enters into or resolves to enter into any arrangement,
composition or compromise with, or assignment for the benefit of, any of its
creditors;
(w)
reorganisation: a
Transaction Party implements a merger, demerger or scheme of arrangement with
any person where the Transaction Party would not be the surviving
party;
(x)
amendment
of constituent documents:
the
memorandum and articles of association, constitution or other constating
documents (including a by-law) of a Transaction Party are amended in a manner
that has, or is reasonably likely to have, a Material Adverse
Effect;
(y) ceasing
business:
a
Transaction Party ceases to carry on business;
(z)
de-listing
on Exchange:
except
with the prior written consent of the Agent, APG ceases to have its ordinary
shares listed for trading on an Exchange;
(aa)
unenforceability:
|
(1)
|
a material provision
of a Document is illegal, void, voidable or
unenforceable;
|
|
(2)
|
any
person becomes entitled to terminate, rescind or avoid any
material provision of any Document;
or
|
|
(3)
|
the
execution, delivery or performance of a Document by a Transaction
Party
breaches or results in a contravention of any
law;
|
(bb) Material
Adverse Effect:
any
event occurs which has or is reasonably likely to have a Material Adverse
Effect; or
(cc)
jurisdictional
equivalent: anything
analogous or having a substantially similar effect to any of the events
specified in clauses 11.1(q),
11.1(r),
11.1(s),
11.1(t),
11.1(u),
11.1(v)
or
11.1(w)
happens
under the law of any applicable jurisdiction.
11.2 Effect
of Event of Default
(a)
If
an
Event of Default occurs the Agent may, at any time after its occurrence by
notice to the Borrower declare that:
|
(1)
|
the
Secured Moneys are immediately due and payable;
or
|
|
(2)
|
the
Commitment is cancelled,
|
or
make
each of the declarations under clauses 11.2(a)(1)
and
11.2(a)(2).
(b)
The
Borrower must immediately repay the Secured Moneys on receipt of a notice under
clause 11.2(a)(1).
11.3 Transaction
Parties to continue to perform
(a)
If
the
Agent makes a declaration under clause 11.2
or a
gives a notice under clause 11.5(d):
|
(1)
|
the
declaration or notice does not affect the obligations of a Transaction
Party under the Transaction Documents;
and
|
|
(2)
|
each
Transaction Party must continue to perform its obligations under
the
Transaction Documents as if the declaration had not been made or
the
notice had not been given, subject to any directions given by a Finance
Party under any Transaction
Document.
|
(b)
Clause 11.3(a)
does not
affect the Borrower’s obligations under clause 11.2.
page
51
|
12 Increased
costs and
illegality
|
11.4 Enforcement
(a)
The
Transaction Documents may be enforced without notice to a Transaction Party
or
any other person even if:
|
(1)
|
a
Finance Party accepts any part of the Secured Moneys after an Event
of
Default; or
|
|
(2)
|
there
has been any other Event of
Default.
|
(b)
No
Finance Party is liable to any Transaction Party for any Loss a Transaction
Party may suffer, incur or be liable for arising out of or in connection with
a
Finance Party exercising any Power, except with respect to the gross negligence
or wilful misconduct of a Finance Party to the extent specifically set out
in a
Transaction Document.
11.5 Review
event
(a)
It
is a
review event if
there is
a change in Control or a material change in the composition of the board or
Key
Personnel of a Transaction Party.
(b)
Each
Transaction Party must notify the Agent as soon as it becomes aware of the
occurrence of a Review Event.
(c)
The
Financier has the right to review the Facility for a period of 30 days from
the
date on which the Agent receives a notice under clause 11.5(b)
or
becomes aware of the occurrence of a Review Event.
(d)
If
the
Financier decides that it does not wish to continue to provide the Facility
following the occurrence of a Review Event, it must give written notice to
that
effect to the Borrower within the 30 day review period referred to in clause
11.5(c).
The
notice must state a date (not earlier than 90 days from the date of the service
of the notice) by which the Secured Moneys must be paid in full, and the
Borrower must pay the Secured Moneys to the Agent in full on the date nominated
in the notice.
12
Increased
costs and illegality
12.1 Increased
costs
(a)
If
the
Financier determines that any Change in Law affecting it or any of its Holding
Companies directly or indirectly:
|
(1)
|
increases
the effective cost to the Financier of performing its obligations
under
the Transaction Documents or funding or maintaining the Commitment
or the
Principal Outstanding;
|
|
(2)
|
reduces
any amount received or receivable by the Financier under the Transaction
Documents; or
|
|
(3)
|
in
any other way reduces the effective return to the Financier or any
Affiliate under the Transaction Documents or the overall return on
capital
of the Financier or any Affiliate,
|
(each
an
Increased
Cost),
the
Borrower must pay to the Financier on demand compensation for the Increased
Cost
to
the
extent attributed by the Financier or Affiliate (using the methods it considers
appropriate) to the Financier’s obligations under the Transaction Documents or
the funding or maintenance of the Commitment or the Principal
Outstanding.
(b)
A
claim
under clause 12.1(a)
in the
absence of manifest error, is sufficient evidence of the amount to which the
Finance Party is entitled under clause 12.1(a)
unless
the contrary is proved.
page
52
|
13 Indemnities
and Break
Costs
|
(c)
If
the
Borrower receives a demand from the Financier under clause 12.1(a),
the
Borrower may, by written notice to the Agent on or before the date which is
20 Business Days after the date of that demand, cancel the Commitment and
prepay the Secured Moneys in full.
(d)
A
notice
under clause 12.1(c)
is
irrevocable and the Borrower must, on the date which is 40 Business Days
after the date that the notice is given, pay to the Agent on account of the
Financier the Secured Moneys in full.
12.2 Illegality
(a)
Subject
to clause 12.2(c),
if any
Change in Law or other event makes it illegal for the Financier to perform
its
obligations under the Transaction Documents or fund or maintain the Commitment,
the Financier may by notice to the Borrower:
|
(1)
|
suspend
its obligations under the Transaction Documents for the duration
of the
illegality; or
|
|
(2)
|
by
notice to the Borrower, cancel the Commitment and require the Borrower
to
repay the Secured Moneys in full on the date which is 40 Business
Days after the date on which the Financier gives the notice or any
earlier
date required by, or to comply with, the applicable
law.
|
(b)
A
notice
under clause 12.2(a)(2)
is
irrevocable and the Borrower must, on the repayment date determined under
clause 12.2(a)(2),
pay to
the Agent on account of the Financier the Secured Moneys in full.
(c)
If
any
Change in Law or other event that makes it illegal for the Financier to perform
its obligation under a Financier Hedging Agreement is a Termination Event under
that Financier Hedging Agreement, then the provisions of the relevant Financier
Hedging Agreement will apply with respect to that Termination Event, and this
clause 12.2
will not
apply.
12.3 Reduction
of Commitment
The
Commitment is reduced by any amount of Secured Moneys paid under this clause
12
and
accordingly an amount paid under this clause 12
may not
be redrawn.
13 Indemnities
and
Break Costs
13.1 General
indemnity
(a)
Each
Transaction Party indemnifies each Finance Party against any Loss which that
Finance Party, a Receiver (whether acting as agent of the Borrower or of a
Finance Party) or an Attorney pays, suffers, incurs or is liable for, in respect
of any of the following:
|
(1)
|
a
Funding Portion required by a Funding Notice not being made for any
reason
including any failure by a Transaction Party to fulfil any condition
precedent contained in clause 2,
but excluding any default by that Finance
Party;
|
|
(2)
|
the
occurrence of any Default;
|
|
(3)
|
a
Finance Party exercising its Powers consequent upon or arising out
of the
occurrence of any Default;
|
|
(4)
|
the
non-exercise, attempted exercise, exercise or delay in the exercise
of any
Power;
|
|
(5)
|
any
act or omission of a Security Provider or any of its employees or
agents;
|
page
53
|
13 Indemnities
and Break
Costs
|
|
(6)
|
the
occupation, use or ownership of any Secured Property by a Security
Provider or any of its employees or
agents;
|
|
(7)
|
any
workers’ compensation claim by any employee of a Security
Provider;
|
|
(8)
|
any
insurance policy in respect of any Secured
Property;
|
|
(9)
|
any
compulsory acquisition or statutory or judicial divestiture of any
Secured
Property;
|
|
(10)
|
any
other thing in respect of a Security or any Secured Property;
and
|
|
(11)
|
any
payment made by the Financier to the Agent to indemnify the Agent
for a
Loss the Agent pays, suffers, incurs or is liable for in acting as
Agent.
|
(b)
The
indemnity in clause 13.1(a),
includes:
|
(1)
|
the
amount determined by a Finance Party as being incurred by reason
of the
liquidation or re-employment of deposits or other funds acquired
or
contracted for by the Finance Party to fund or maintain the Commitment;
and
|
|
(2)
|
loss
of margin,
|
but
does
not include any Loss arising out of or due to the gross negligence or wilful
misconduct of a Finance Party.
13.2 Break
Costs
The
Borrower must, within 3 Business Days of demand by the Agent, pay to the
Agent for the account of each Finance Party its Break Costs attributable to
all
or any part of a Funding Portion being prepaid or repaid by the Borrower on
a
day other than the last day of the Interest Period for that Funding
Portion.
13.3 Foreign
currency indemnity
If,
at
any time:
(a)
a
Finance
Party, a Receiver or an Attorney receives or recovers any amount payable by
a
Transaction Party including:
|
(1)
|
under
any judgment or order of any Government
Agency;
|
|
(2)
|
for
any breach of any Transaction
Document;
|
|
(3)
|
on
the liquidation or bankruptcy of the Transaction Party or any proof
or
claim in that liquidation or bankruptcy;
or
|
|
(4)
|
any
other thing into which the obligations of the Transaction Party may
have
become merged; and
|
(b)
the
Payment Currency is not the Relevant Currency,
the
Borrower indemnifies each Finance Party, Receiver or Attorney against any
shortfall between the amount payable in the Relevant Currency and the amount
actually or notionally received or recovered by each Finance Party, Receiver
or
Attorney after the Payment Currency is converted or translated into the Relevant
Currency under clause 13.4.
13.4 Conversion
of currencies
In
making
any currency conversion under clause 13.3,
a
Finance Party, Receiver or Attorney may itself or through its bankers purchase
one currency with another, whether or not through an intermediate currency,
whether spot or forward, in the manner and amounts and at the times it thinks
fit.
page
54
|
14 Fees,
Tax, costs and
expenses
|
13.5 Continuing
indemnities and evidence of Loss
(a)
Each
indemnity of a Transaction Party in a Transaction Document is a continuing
obligation of the Transaction Party, despite:
|
(1)
|
any
settlement of account; or
|
|
(2)
|
the
occurrence of any other thing,
|
and
remains in full force and effect until:
|
(3)
|
the
Secured Moneys are fully and finally repaid;
and
|
|
(4)
|
each
Security has been finally
discharged.
|
(b)
Each
indemnity of a Transaction Party in a Transaction Document is an additional,
separate and independent obligation of a Transaction Party and no one indemnity
limits the general nature of any other indemnity.
(c)
Each
indemnity of a Transaction Party in a Transaction Document survives the
termination of any Transaction Document.
(d)
A
certificate given by an Officer of a Finance Party detailing the amount of
any
Loss covered by any indemnity in a Transaction Document is sufficient evidence
unless the contrary is proved.
14
Fees,
Tax, costs and expenses
14.1 Arrangement
fee
The
Borrower must, on or before the date that the first Funding Portion is provided
under clause 5.1,
pay to
the Agent a non-refundable and non-rebateable arrangement fee equal to 1.5%
of
the Commitment, being US$120,000.
14.2 Commitment
fee
The
Borrower must pay the Financier a
non-refundable commitment fee equal to 0.75% per annum calculated on a daily
basis on the average monthly balance of the Undrawn Commitment on the basis
of a
360 day year and for the actual number of days elapsed. The commitment fee
is to commence on the date the conditions precedent in clause 2.1
are
satisfied and is to be paid
in
arrears on
each
subsequent Quarterly Date and on the last
day
of the Availability Period.
14.3 Tax
(a)
The
Borrower must pay any Tax, other than an Excluded Tax in respect of any Finance
Party, which is payable in respect of a Transaction Document (including in
respect of the execution, delivery, performance, release, discharge, amendment
or enforcement of a Transaction Document).
(b)
The
Borrower must pay any fine, penalty or other cost in respect of a failure to
pay
any Tax described in clause 14.3(a)
except
to the extent that the fine, penalty or other cost is caused by the Agent’s
failure to lodge money received from the Borrower within 5 Business Days
before the due date for lodgement.
(c)
The
Borrower indemnifies each Finance Party against any amount payable under
clause 14.3(a)
or
14.3(b).
page
55
|
15 Interest
on overdue
amounts
|
14.4 Costs
and expenses
The
Borrower must pay all costs and expenses of each Finance Party in relation
to:
(a)
the
negotiation, preparation, execution, delivery, stamping, registration,
completion, variation and discharge of any Transaction Document;
(b)
the
enforcement, protection or waiver of any rights under any Transaction
Document;
(c)
the
consent or approval of a Finance Party given under any Transaction Document;
(d)
any
enquiry by a Government Agency involving the Borrower; and
(e)
1
site
visit for 2 representatives of the Finance Parties to the Project on the
occurrence of:
|
(1)
|
a
material change in the Project
Plan;
|
|
(2)
|
a
potential Default, occurrence and continuance of a Default or an
Event of
Default (as that expression is defined in any Transaction Document);
or
|
|
(3)
|
a
Termination Event,
|
including:
(f)
any
administration costs of each Finance Party in relation to the matters described
in clause 14.4(c)
or
14.4(d);
and
(g)
any
reasonable legal costs and expenses and any professional consultant’s
fees
on a
full indemnity basis.
15
Interest
on overdue amounts
15.1 Payment
of interest
Each
Transaction Party must pay interest on:
(a)
any
of
the Secured Moneys due and payable by it, but unpaid; and
(b)
any
interest payable but unpaid under this clause 15.
15.2 Accrual
of interest
The
interest payable under this clause 15:
(a)
accrues
from day to day from and including the due date for payment up to the actual
date of payment, before and, as an additional and independent obligation, after
any judgment or other thing into which the liability to pay the Secured Moneys
becomes merged; and
(b)
may
be
capitalised at monthly intervals.
15.3 Rate
of interest
The
rate
of interest payable under this clause 15
on any
part of the Secured Moneys is the higher of:
(a)
the
Overdue Rate determined by the Agent:
|
(1)
|
on
the date that part of the Secured Moneys becomes due and payable
but is
unpaid; and
|
|
(2)
|
on
each date which is 1 month after the immediately preceding date on
which the Overdue Rate was determined under this clause 15.3(a);
and
|
(b)
the
rate
fixed or payable under a judgment or other thing referred to in
clause 15.2(a).
page
56
|
16 Assignment
|
16
Assignment
16.1 Assignment
by Transaction Party
A
Transaction Party must not assign or novate any of its rights or obligations
under a Transaction Document without the prior written consent of the
Agent.
16.2 Borrower
obligation in registered form
The
obligation of the Borrower to pay principal and interest under this agreement
is
taken to be in registered form for the purposes of the United States Internal
Revenue Code, Sections 871(h)(6), 881(c)(6), 163(f) and the regulations issued
thereunder, including Temp. Treas. Reg. Section 5f.163-1(a) and Temp. Treas.
Reg. Section 5f.103-1. Accordingly the Borrower must maintain a book entry
system to record the owner of the right to principal and interest and must
issue
to the Financier a Promissory Note evidencing a Funding Portion and making
specific reference to the comply with the registration requirements in order
to
effect a transfer of the rights under the obligation, and clause 16.3
will
apply to any assignment by the Financier of its rights under a Transaction
Document with respect to the obligation of the Borrower to pay principal and
interest.
16.3 Assignment
by Finance
Party
(a)
A
Finance
Party may assign or novate any of its rights and obligations under a Transaction
Document to any person if:
|
(1)
|
any
necessary prior Authorisation is
obtained;
|
|
(2)
|
the
assignment or novation is to a person in the RMB group of companies
(which
term includes any person, partnership or corporate entity in that
group)
or, after consultation with the Borrower, to a reputable bank or
financial
institution or to a combination of reputable banks and financial
institutions; and
|
|
(3)
|
it
notifies the Agent and the
Borrower.
|
(b)
In
the
event that the Financier elects to assign any of its rights under clause
16.3(a),
the
Financier must surrender to the Borrower each Promissory Note then on issue,
and
the Borrower must reissue those Promissory Notes to the assignee. An assignment
by the Financier will be taken to be effective when the Promissory Notes are
reissued by the Borrower.
16.4 Assist
Each
party must do any thing which the Agent reasonably requests including, executing
any documents or amending any Transaction Document, to effect any transfer,
assignment or novation under this clause 16.
16.5 Participation
not
permitted
A
Finance
Party may not grant a participation interest (being a right to share in the
financial benefits of this agreement, without any rights against a Transaction
Party) in any of that Finance Party’s rights and benefits under this agreement
to any other person.
16.6 Lending
Office
(a)
A
Finance
Party may change its Lending Office at any time.
(b)
A
Financier must promptly notify the Agent and the Borrower of the
change.
page
57
|
17 Saving
provisions
|
16.7 No
increase in costs
If
a
Finance Party assigns or novates any of its rights or obligations under any
Transaction Document or changes its Lending Office, no Transaction Party is
required to pay any net increase in the aggregate amount of costs,
Taxes,
fees or charges which is a
direct
consequence of the transfer or assignment or change of Lending
Office.
17
Saving
provisions
17.1 No
merger of security
(a)
Nothing
in this agreement merges, extinguishes, postpones, lessens or otherwise
prejudicially affects:
|
(1)
|
any
Encumbrance or indemnity in favour of any Finance Party;
or
|
|
(2)
|
any
Power.
|
| (b) |
No
other Encumbrance or Transaction Document which a Finance Party has
the
benefit of in any way prejudicially affects any
Power.
|
17.2 Exclusion
of moratorium
To
the
extent not excluded by law, a provision of any legislation which directly or
indirectly:
(a)
lessens,
varies or affects in favour of a Transaction Party any obligations under a
Transaction Document; or
(b) stays,
postpones or otherwise prevents or prejudicially affects the exercise by any
Finance Party of any Power,
is
negatived and excluded from each Transaction Document and all relief and
protection conferred on a Transaction Party by or under that legislation is
also
negatived and excluded.
17.3 Conflict
Where
any
right, power, authority, discretion or remedy conferred on a Finance Party,
a
Receiver or an Attorney by any Transaction Document is inconsistent with the
powers conferred by applicable law then, to the extent not prohibited by that
law, those conferred by applicable law are regarded as negatived or varied
to
the extent of the inconsistency.
17.4 Consents
(a)
Whenever
the doing of any thing by a Transaction Party is dependent on the consent of
a
Finance Party, the Finance Party may withhold its consent or give it
conditionally or unconditionally in its absolute discretion, unless expressly
stated otherwise in a Transaction Document.
(b)
Any
conditions imposed on a Transaction Party by a Finance Party under
clause 17.4(a)
must be
complied with by the Transaction Party.
17.5 Principal
obligations
This
agreement and each Collateral Security is:
(a)
a
principal obligation and is not ancillary or collateral to any other Encumbrance
(other than another Collateral Security) or other obligation; and
page
58
|
17 Saving
provisions
|
(b)
independent
of, and unaffected by, any other Encumbrance or other obligation which any
Finance Party may hold at any time in respect of the Secured
Moneys.
17.6 Non-avoidance
If
any
payment by a Transaction Party to a Finance Party is avoided for any reason
including any legal limitation, disability or incapacity of or affecting the
Transaction Party or any other thing, and whether or not:
(a)
any
transaction relating to the Secured Moneys was illegal, void or substantially
avoided; or
(b)
any
thing
was or ought to have been within the knowledge of any Finance
Party,
the
Transaction Party:
(c)
as
an
additional, separate and independent obligation, indemnifies each Finance Party
against that avoided payment; and
(d) acknowledges
that any liability of the Transaction Party under the Transaction Documents
and
any right or remedy of the Finance Parties under the Transaction Documents
is
the same as if that payment had not been made.
17.7 Set-off
authorised
If
a
Transaction Party does not pay any amount when due and payable by it to any
Finance Party under a Transaction Document, the Finance Party may:
(a)
apply
any
credit balance in any currency in any account of the Transaction Party with
the
Finance Party in or towards satisfaction of that amount;
and
(b)
effect
any currency conversion which may be required to make an application under
clause 17.7(a).
17.8 Agent’s
certificates and approvals
(a)
A
certificate signed by any Officer of the Agent in relation to any amount,
calculation or payment under any Transaction Document is sufficient evidence
of
that amount, calculation or payment unless the contrary is proved.
(b)
Where
any
provision of a Transaction Document requires the Agent’s approval, that approval
will not be effective unless and until it is provided in writing.
17.9 No
reliance or other obligations and risk assumption
Each
Transaction Party acknowledges and confirms that:
(a)
it
has
not entered into any Transaction Document in reliance on any representation,
warranty, promise or statement made by or on behalf of any Finance
Party;
(b)
in
respect of the transactions evidenced by the Transaction Documents, no Finance
Party has any obligations other than those expressly set out in the Transaction
Documents; and
(c)
in
respect of interest rates, exchange rates or commodity prices, no Finance Party
is liable for any movement in interest rates, exchange rates or commodity prices
or any information, advice or opinion provided by any Finance Party or any
person on behalf of any Finance Party, even if:
|
(1)
|
provided
at the request of a Transaction Party (it being acknowledged by each
Transaction Party that those matters are inherently
speculative);
|
|
(2)
|
relied
on by a Transaction Party; or
|
|
(3)
|
provided
incorrectly or negligently.
|
page
59
|
|
18 General
|
| 17.10 |
Power
of attorney
|
| (a) |
For
consideration received, each Transaction Party irrevocably appoints
the
Agent and each Officer of the Agent, effective upon the occurrence
and
during the continuance of an Event of Default, as the attorney of
the
Transaction Party to:
|
|
(1)
|
execute
and deliver all documents; and
|
|
(2)
|
do
all things,
|
which
are
necessary or desirable to give effect to each Transaction Document.
| (b) |
An
attorney appointed under clause 17.10(a)
may appoint a substitute attorney to perform any of its
powers.
|
| 18 |
General
|
| 18.1 |
Confidential
information
|
A
Finance
Party must not disclose to any person:
| (a) |
any
Transaction Document; or
|
| (b) |
any
information about any Transaction Party,
|
except:
| (c) |
in
connection with a permitted assignment, novation or participation
under
clause 16,
where the disclosure is made on the basis that the recipient of the
information will comply with this clause 18.1
in
the same way that the Finance Party is required to
do;
|
| (d) |
to
any professional or other adviser consulted by it in relation to
any of
its rights or obligations under the Transaction
Documents;
|
| (e) |
to
a country’s central bank, a country’s taxation office or any Government
Agency requiring disclosure of the
information;
|
| (f) |
in
connection with the enforcement of its rights under the Transaction
Documents;
|
| (g) |
where
the information is already in the public domain, or where the disclosure
would not otherwise breach any duty of confidentiality;
|
| (h) |
if
required by applicable law or the rules of any securities exchange;
or
|
| (i) |
otherwise
with the prior written consent of the relevant Transaction Party
(that
consent not to be unreasonably
withheld).
|
| 18.2 |
Transaction
Party to bear cost
|
Any
thing
which must be done by a Transaction Party under any Transaction Document,
whether or not at the request of any Finance Party, must be done at the cost
of
the Transaction Party.
| 18.3 |
Notices
|
| (a) |
Any
notice or other communication including, any request, demand, consent
or
approval, to or by a party to any Transaction Document must
be in legible writing and in English addressed to the party in accordance
with its details set out in schedule 1 or as specified to the sender
by the party by notice.
|
| (b) |
If
the sender is a company, any such notice or other communication must
be
signed by an Officer of the sender.
|
page
60
|
|
18 General
|
| (c) |
Any
notice or other communication described in this clause 18.3
is
regarded as being given by the sender and received by the
addressee:
|
|
(1)
|
if
by delivery in person or by recognized overnight courier, when delivered
to the addressee;
|
|
(2)
|
if
by post, on delivery to the addressee;
or
|
|
(3)
|
if
by facsimile, when received by the addressee in legible
form,
|
but
if
the delivery or receipt is on a day which is not a Business Day or is after
4.00pm (addressee’s time) it is regarded as received at 9.00am on the following
Business Day.
| (d) |
Any
notice or other communication described in this clause 18.3
can be relied on by the addressee and the addressee is not liable
to any
other person for any consequences of that reliance if the addressee
believes it to be genuine, correct and authorised by the
sender.
|
| (e) |
A
facsimile transmission is regarded as legible unless the addressee
telephones the sender within 2 hours after the transmission is
received or regarded as received under clause 18.3(c)
and informs the sender that it is not
legible.
|
| 18.4 |
Governing
law and jurisdiction
|
| (a) |
| (b) |
Each
Transaction Party and each Finance Party irrevocably submits to the
non-exclusive
jurisdiction of the federal courts of the State of
Colorado.
|
| (c) |
Each
Transaction Party and each Finance Party irrevocably waives any objection
to the venue of any legal process on the basis that the process has
been
brought in an inconvenient forum.
|
| (d) |
Each
Transaction Party and each Finance Party irrevocably waives any immunity
in respect of its obligations under this agreement that it may acquire
from the jurisdiction of any court or any legal process for any reason
including the service of notice, attachment before judgment, attachment
in
aid of execution or execution.
|
| 18.5 |
Prohibition
and enforceability
|
| (a) |
Any
provision of, or the application of any provision of, any Transaction
Document or any Power which is prohibited in any jurisdiction is, in that
jurisdiction, ineffective only to the extent of that
prohibition.
|
| (b) |
Any
provision of, or the application of any provision of, any Transaction
Document which is void, illegal or unenforceable in any jurisdiction
does
not affect the validity, legality or enforceability of that provision
in
any other jurisdiction or of the remaining provisions in that or
any other
jurisdiction.
|
| 18.6 |
Waivers
|
| (a) |
Waiver
of any right arising from a breach of this agreement or of any Power
arising on default under this agreement or on the occurrence of an
Event
of Default must be in writing and signed by the party granting the
waiver.
|
| (b) |
A
failure or delay in exercise, or partial exercise,
of:
|
|
(1)
|
a
right arising from a breach of this agreement or the occurrence of
an
Event of Default; or
|
|
(2)
|
a
Power created or arising on default under this agreement or on the
occurrence of an Event of Default,
|
does
not
result in a waiver of that right or Power.
page
61
|
|
18 General
|
| (c) |
A
party is not entitled to rely on a delay in the exercise or non-exercise
of a right or Power arising from a breach of this agreement or on
a
default under this agreement or on the occurrence of an Event of
Default
as constituting a waiver of that right or
Power.
|
| (d) |
A
party may not rely on any conduct of another party as a defence to
exercise of a right or Power by that other
party.
|
| (e) |
This
clause may not itself be waived except in
writing.
|
| 18.7 |
Variation
|
A
variation of any term of this agreement must be in writing and signed by the
parties.
| 18.8 |
Cumulative
rights
|
The
Powers are cumulative and do not exclude any other right, power, authority,
discretion or remedy of any Finance Party, Receiver or Attorney.
| 18.9 |
Attorneys
|
Each
of
the attorneys executing this agreement states that the attorney has no notice
of
the revocation of the power of attorney appointing that attorney.
| 18.10 |
Counterparts
|
| (a) |
This
agreement may be executed in any number of
counterparts.
|
| (b) |
All
counterparts, taken together, constitute one
instrument.
|
| (c) |
A
party may execute this agreement by signing any
counterpart.
|
page
62
Schedules
Table
of
contents
|
Notice
Details
|
64
|
|||
|
Repayment
Schedule
|
66
|
|||
|
Securities
|
67
|
|||
|
Officer’s
certificate
|
68
|
|||
|
Funding
Notice
|
70
|
|||
|
Promissory
Note
|
71
|
|||
|
Permitted
Encumbrances
|
73
|
|||
|
Material
Agreements
|
75
|
|||
|
▇▇▇
▇▇▇
|
▇▇
|
|||
|
Key
Mineral Rights
|
90
|
|||
|
Current
Insurance Policies
|
96
|
|||
|
Excluded
Claims
|
97
|
page
63
Schedule
1
Notice
Details
|
Borrower
|
Montana
Tunnels Mining, Inc.
|
|
Address
|
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ Village, Colorado 80111-3220,
United States of America
|
|
Attention
|
R.
▇▇▇▇▇ ▇▇▇▇▇▇▇
|
|
Phone
|
▇▇
▇▇▇ ▇▇▇ ▇▇▇▇
|
|
Fax
|
▇▇
▇▇▇ ▇▇▇ ▇▇▇▇
|
|
Email
|
▇▇▇▇▇▇▇▇▇@▇▇▇.▇▇▇
|
|
Guarantor
|
Apollo
Gold Inc.
|
|
Address
|
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ Village, Colorado 80111-3220,
United States of America
|
|
Attention
|
R.
▇▇▇▇▇ ▇▇▇▇▇▇▇
|
|
Phone
|
▇▇
▇▇▇ ▇▇▇ ▇▇▇▇
|
|
Fax
|
▇▇
▇▇▇ ▇▇▇ ▇▇▇▇
|
|
Email
|
▇▇▇▇▇▇▇▇▇@▇▇▇.▇▇▇
|
|
Guarantor
|
Apollo
Gold Corporation
|
|
Address
|
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ Village, Colorado 80111-3220,
United States of America
|
|
Attention
|
R.
▇▇▇▇▇ ▇▇▇▇▇▇▇
|
|
Phone
|
▇▇
▇▇▇ ▇▇▇ ▇▇▇▇
|
|
Fax
|
▇▇
▇▇▇ ▇▇▇ ▇▇▇▇
|
|
Email
|
▇▇▇▇▇▇▇▇▇@▇▇▇.▇▇▇
|
|
Agent
|
RMB
Resources Inc.
|
|
Address
|
Suite
900, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇
of
America
|
|
Attention
|
▇▇▇▇
▇▇▇▇▇▇▇
|
page
64
|
|
Schedule
l Notice
Details
|
|
Phone
|
▇▇
▇▇▇ ▇▇▇ ▇▇▇▇
|
|
Fax
|
▇▇
▇▇▇ ▇▇▇ ▇▇▇▇
|
|
Email
|
▇▇▇▇.▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
|
|
Financier
|
RMB
Australia Holdings Limited
|
|
Address
|
▇▇▇▇▇
▇▇, ▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇
|
|
Attention
|
▇▇▇▇▇▇▇
▇▇▇
|
|
Phone
|
▇▇▇
▇ ▇▇▇▇ ▇▇▇▇
|
|
Fax
|
▇▇▇
▇ ▇▇▇▇ ▇▇▇▇
|
|
Email
|
▇▇▇▇.▇▇▇@▇▇▇.▇▇▇.▇▇
|
page
65
Schedule
2
Repayment
Schedule
|
Repayment
Date
|
Repayment
Amount
|
|
31
December 2007
|
15%
of the Principal Outstanding as at 31 December 2007
|
|
31
March 2008
|
33%
of the Principal Outstanding as at 31 March 2008
|
|
30
June 2008
|
50%
of the Principal Outstanding as at 30 June 2008
|
|
30
September 2008
|
100%
of the Principal Outstanding as at 30 September
2008
|
page
66
Schedule
3
Securities
|
1
|
The
RMB GSA.
|
|
2
|
The
pledge agreement dated on or about the date of this agreement granted
by
AGI in favour of the Finance Parties in respect of AGI’s shares in the
Borrower.
|
|
3
|
The
security agreement dated on or about the date of this agreement granted
by
the Borrower in favour of the Finance
Parties.
|
|
4
|
The
mortgage dated on or about the date of this agreement granted by
the
Borrower in favour of the Finance Parties.
|
|
5
|
The
Perfection Certificates of the Borrower and AGI and the related UCC-1
Financing Statements filed by the Agent on or around 12 October 2007
in
the Office of the Delaware Secretary of
State.
|
page
67
Schedule
4
Officer’s
certificate
To: RMB
Resources Inc.
I
[insert
name]
am a
[insert
capacity - director/secretary]
of each
of [insert
names of Transaction Parties]
(each a
Transaction Party).
I
refer
to the facility agreement dated [insert
date]
between
Montana Tunnels Mining, Inc. (as Borrower),
Apollo
Gold Corporation, Apollo Gold Inc. (as Guarantors),
RMB
Australia Holdings Limited (as Financier)
and RMB
Resources Inc. (as Agent)
(Facility
Agreement).
A
term
defined in the Facility Agreement has the same meaning when used in this
Certificate.
I
have
been authorised by each Transaction Party to give this certificate.
I
certify
as follows:
| 1 |
Relevant
documents
|
Attached
to this certificate are true, complete and up-to-date copies of each of the
following:
| (a) |
constituent
documents:
the memorandum and articles of association, by-laws, constitution
or other
constating documents of each Transaction
Party;
|
| (b) |
[power
of attorney:
a
duly executed power of attorney granted by each Transaction Party
authorising execution of the Transaction Documents to which it is
a
party;] [to
be included if applicable]
and
|
| (c) |
board
minutes: minutes
of a meeting of the directors of each relevant Transaction Party
approving
the execution and performance of its obligations under the Transaction
Documents to which it is expressed to be a party and the granting
of the
power of attorney referred to in paragraph (b)
above.
|
| 2 |
No
revocation
|
Each
document, power of attorney
and
resolution referred
to in paragraph 1 is in full force and effect and has not been amended,
modified or revoked.
| 3 |
Officers
|
The
following signatures are the true signatures of each of the Officers of the
Borrower as at the date of this certificate:
page
68
|
|
Schedule 4 Officer's
certificate
|
|
Name
|
Position
|
Signature
|
|
|
(a) [insert
name]
|
[insert
details of position]
|
____________
|
|
|
(b) [insert
name]
|
[insert
details of position]
|
____________
|
|
|
(c) [insert
name]
|
[insert
details of position]
|
____________
|
| 4 |
Certification
|
| (a) |
As
at the date of execution of each Transaction Document, each Transaction
Party is solvent and will not become insolvent by entering into and
performing its obligations under each Transaction Document to which
is a
party.
|
| (b) |
No
Default has occurred and is continuing and no Default will arise
if a
Funding Portion is provided by the Financier under the Facility
Agreement.
|
| (c) |
Since
31 December 2006, and as at the date of this certificate, no event
has
occurred and is continuing which has had or is likely to have a Material
Adverse Effect.
|
| (d) |
As
at the date of this certificate, each representation and warranty
in the
Facility Agreement is true, correct and not
misleading.
|
Signed:
[insert
name and capacity –
director/secretary]
Date:
page
69
Schedule
5
Funding
Notice
To: RMB
Resources Inc.
Attention:
[insert
relevant name]
We
refer
to the facility agreement dated [insert
date]
between
Montana Tunnels Mining, Inc. (as Borrower),
Apollo
Gold Corporation, Apollo Gold Inc. (as Guarantors),
RMB
Australia Holdings Limited (as Financier)
and RMB
Resources Inc. (as Agent)
(Facility
Agreement).
Under
clause 4
of the
Facility Agreement:
| (a) |
we
give you notice that we wish to draw on [ ]
(Funding
Date);
|
| (b) |
the
aggregate amount to be drawn is US$[ ];
|
| (c) |
particulars
of each Funding Portion are:
|
|
Principal
amount
|
Interest
Period
|
|
90
days
|
| (d) |
The
proceeds of each Funding Portion are to be used in accordance with
clause 3.2
of
the Facility Agreement.
|
| (e) |
We
request that the proceeds be remitted to the Proceeds Account, details
of
which are as follows:
|
| (f) |
[ ];
|
| (g) |
We
represent and warrant that no Default has occurred and is continuing
or
will result from the provision of any Funding Portion[,
except as follows: [ ],
and we propose the following remedial action [ ]].
|
| (h) |
As
at the date of this certificate, no event has occurred and is continuing
which has had, or is likely to have, a Material Adverse
Effect.
|
| (i) |
As
at the date of this certificate, each representation and warranty
in the
Facility Agreement is true, correct and not
misleading.
|
| (j) |
Expressions
defined in the Facility Agreement have the same meaning when used
in this
Funding Notice.
|
Date:
Signed
for and
on behalf of
the
Borrower
by
_________________________
Officer
_________________________
Name
(please print)
page
70
Schedule
6
Promissory
Note
MONTANA
TUNNELS MINING, INC.
PROMISSORY
NOTE DUE 30 SEPTEMBER 2008
| US$1 | ||
|
2
|
||
|
3
|
|
FOR
VALUE RECEIVED,
MONTANA
TUNNELS MINING, INC.,
a
Delaware corporation (Borrower),
promises to pay to the order of RMB
AUSTRALIA HOLDINGS LIMITED,
a
company incorporated under the laws of Australia (Payee),
on or
before 30 September 2008, the lesser of (x)4
(US$[5 ])
and
(y) the Principal Outstanding in respect of all advances made by Payee to
Borrower as Funding Portions under the Facility Agreement referred to
below.
Borrower
also promises to pay interest on the unpaid principal amount of this Promissory
Note, from the date of this Promissory Note until paid in full, at the rates
and
at the times which are determined in accordance with the provisions of the
Facility Agreement dated as of [insert
date]
by and
among Borrower, Payee, Montana Tunnels Mining, Inc., a Delaware corporation
and
RMB Resources Inc., a Delaware corporation, as agent for the Payee (that
Facility Agreement, as it may be amended, supplemented or otherwise modified
from time to time, being the Facility
Agreement,
and
terms defined in the Facility Agreement which are not otherwise defined in
this
Promissory Note have the same meaning in this Promissory Note as defined in
the
Facility Agreement).
This
Promissory Note is one of the Borrower’s Promissory Notes which in the aggregate
may evidence up to US$8,000,000 principal amount of the Commitment, to which
reference is made for a more complete statement of the terms and conditions
under which the Commitment evidenced by this Promissory Note were made and
are
to be repaid.
All
payments of principal and interest in respect of this Promissory Note must
be
made in United States Dollars, in same day funds, without defense, set-off
or
counterclaim, free of any restriction or condition, and must be delivered to
Agent at the times provided for in the Facility Agreement. Until notified in
writing of the transfer of this Promissory Note, Borrower and Agent are entitled
to take Payee, or any person who has been identified by the transferor in
writing to Borrower and Agent as the owner and holder of this Promissory Note.
Each of Payee and any subsequent holder of this Promissory Note agrees, by
its
acceptance of this Promissory Note, that before disposing of this Promissory
Note or any part or portion of it, it will make a notation in the annexure
to
this Promissory Note of all principal payments previously made under this
Promissory Note and of the date to which interest due under this Promissory
Note
has been paid, provided, however, that the failure to make a notation of any
payment made on this Promissory Note does not limit or otherwise affect the
obligations of Borrower under this Promissory Note with respect to payments
of
principal of or interest owing.
1
Insert
amount of the Funding Portion to which this Promissory Note relates in
numbers.
2
Insert
place of delivery of this Promissory Note.
3
Insert
the effective date of this Promissory Note.
4
In words
insert amount of the Funding Portion to which this Promissory Note
relates.
5
Insert
amount of the Funding Portion to which this Promissory Note relates in
numbers.
page
71
|
|
Schedule 6 Promissory
Note
|
Whenever
any payment on this Promissory Note is stated to be due on a day which is not
a
Business Day, such payment shall be made on the next succeeding Business
Day.
This
Promissory Note is subject to mandatory prepayment and to prepayment at the
option of Borrower as provided in clause 3
of the
Facility Agreement.
THE
FACILITY AGREEMENT AND THIS PROMISSORY NOTE ARE GOVERNED BY, AND WILL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF
COLORADO, OTHER THAN ANY LAWS WHICH WOULD IMPOSE THE LAWS OF ANOTHER
JURISDICTION.
If
a
Default occurs, the unpaid balance of the principal amount of this Promissory
Note, together with all accrued and unpaid interest on this Promissory Note,
may
become, or may be declared to be, due and payable in the manner, on the
conditions and with the effect provided in the Facility Agreement.
The
terms
of this Promissory Note are subject to amendment only in the manner provided
in
the Facility Agreement.
This
Promissory Note is subject to restrictions on transfer or assignment as provided
in clause 16
of the
Facility Agreement.
No
reference in this Promissory Note to the Facility Agreement and no provision
of
this Promissory Note or the Facility Agreement will alter or impair the
obligations of Borrower, which are absolute and unconditional, to pay the
principal of and interest on this Promissory Note at the place, at the
respective times, and in the currency prescribed in this Facility
Agreement.
Borrower
promises to pay all costs and expenses, including attorneys’ fees, all as
provided in clause 14.4
of the
Facility Agreement, incurred in the collection and enforcement of this
Promissory Note. Borrower and any endorsers of this Promissory Note consent
to
renewals and extensions of time at or after the maturity of this Promissory
Note, without notice, and waive diligence, presentment, protest, demand and
notice of every kind and, to the full extent permitted by law, the right to
plead any statute of limitations as a defence to any demand under this
Promissory Note.
IN
WITNESS WHEREOF,
Borrower has caused this Promissory Note to be duly executed and delivered
by
its Officer as of the date and at the place first written above.
MONTANA
TUNNELS MINING, INC.
By:
Title:
page
72
Schedule
7
Permitted
Encumbrances
|
1
|
a
lien created by operation of law securing an obligation that is not
yet
due or which is being diligently contested in good faith by appropriate
proceedings and in respect of which there has been set aside a reserve
(segregated to the extent required by Accounting Standards) in an
amount
which is adequate;
|
|
2
|
a
lien for the unpaid balance of purchase money under an instalment
contract
entered into in the ordinary course of
business;
|
|
3
|
a
lien for the unpaid balance of money owing for
repairs;
|
|
4
|
any
Encumbrance arising in respect of the cash deposits, letters of credit
and
other arrangements relating to the Environmental
Bonding;
|
|
5
|
any
Encumbrance arising in connection with workers’ compensation, unemployment
insurance and other social security legislation, to secure the performance
of statutory obligations, surety and appeal bonds, performance bonds
and
other obligations of a like nature in connection with court proceedings,
provided that those Encumbrances are related to obligations not due
or
delinquent (taking into account any applicable grace or cure periods),
adequate hold backs are being maintained as required by applicable
legislation or those Encumbrances are being contested in good faith
by
appropriate proceedings and in respect of which there has been set
aside a
reserve (segregated to the extent required by Accounting Standards)
in an
amount which is adequate and provided further that those Encumbrances
do
not in the aggregate materially detract from the value of the assets
of a
Transaction Party as a whole or materially interfere with the use
of those
assets in the operation of the business of the relevant Transaction
Party;
|
|
6
|
any
Encumbrances for Taxes and other governmental charges and assessments
(except assessments for public improvements levied, pending or deferred
against real property) provided that those Encumbrances are related
to
obligations not due or delinquent (taking into account any applicable
grace or cure periods), adequate hold backs are being maintained
as
required by applicable legislation or those Encumbrances are being
contested in good faith by appropriate proceedings and in respect
of which
there has been set aside a reserve (segregated to the extent required
by
Accounting Standards) in an amount which is adequate;
|
|
7
|
any
inchoate or statutory Encumbrances of carriers, warehousemen, mechanics
and materialmen and other like Encumbrances, including purchase money
security interests, arising in the Ordinary Course of Business and
provided that those Encumbrances are related to obligations not due
or
delinquent (taking into account any applicable grace or cure periods),
adequate hold backs are being maintained as required by applicable
legislation or those Encumbrances are being contested in good faith
by
appropriate proceedings and in respect of which there has been set
aside a
reserve (segregated to the extent required by Accounting Standards)
in an
amount which is adequate;
|
|
8
|
any
inchoate or statutory Encumbrances in favour of lessors arising in
connection with any property leased to the Borrower provided that
those
Encumbrances are related to obligations not due or delinquent (taking
into
account any applicable grace or cure periods), adequate hold backs
are
being maintained as required by applicable legislation or those
Encumbrances are being contested in good faith by appropriate proceedings
and in respect of which there has been set aside a reserve (segregated
to
the extent required by Accounting Standards) in an amount which is
adequate;
|
page
73
|
|
Schedule 7 Permitted
Encumbrances
|
|
9
|
the
cross-lien granted between the Borrower and EKT under section 6.6
of the
MDOA and any other Encumbrances created under the MDOA or the
MOOA;
|
|
10
|
any
Encumbrance set out in the ▇▇▇▇▇▇▇ Title
Reports;
|
|
11
|
the
Canada Trust Securities; and
|
|
12
|
each
Security and Collateral Security,
|
which
affects or relates to any of the assets of any Transaction Party.
page
74
Schedule
8
Material
Agreements
|
1
|
all
agreements evidencing the Environmental Bonding
arrangements;
|
|
2
|
the
Services Agreement;
|
|
3
|
each
Sales Contract;
|
|
4
|
Installment
Sales Agreement, dated February 27, 2007, between Tractor & Equipment
Co. and the Company (for Caterpillar Wheel
Loader);
|
|
5
|
Lease
Agreement with Marquette Equipment Finance, LLC., dated November
21,
2006;
|
|
6
|
Lease
Agreement with Financial Federal Credit, Inc., dated May 15,
2007;
|
|
7
|
Lead
Concentrate Agreement, dated February 20, 2007, between Teck Cominco
Metals Ltd. and Apollo Gold Inc.;
|
|
8
|
Zinc
Concentrate Agreement, dated February 20, 2007, between Teck Cominco
Metals Ltd. and Apollo Gold Inc.;
|
|
9
|
Agreement,
dated July 25, 2007, between Montana Tunnels Mining, Inc. and ▇▇▇▇▇▇▇
Matthey Inc.;
|
|
10
|
Fuel
and Lubricants Procurement Contracts, dated February 27, 2004, by and
between ▇▇▇▇▇▇▇ Oil Company and Montana Tunnels Mining,
Inc.;
|
|
11
|
Explosives
Procurement Contract by and between ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Mining, Inc.
and
Montana Tunnels Mining, Inc., dated October 17,
2006;
|
|
12
|
Explosives
Accessories Procurement Contract by and between Intermountain West
Energy,
Inc. and Montana Tunnels Mining, Inc., dated April 1,
2004;
|
|
13
|
Copper
Sulfate Procurement Contract by and between Teck Cominco American,
Inc.
and Montana Tunnels Mining, Inc., dated June 1,
2007;
|
|
14
|
Grinding
Media Procurement Contract by and between Smorgon Steel Grinding
Systems - America, LLC and Montana Tunnels Mining, Inc., dated
February 1, 2007;
|
|
15
|
Exploration
and Mining Lease, dated March 19, 2004, between Fremont River
Development Corporation and Montana Tunnels Mining,
Inc.;
|
|
16
|
BLM
Right-of-Way MTM 67039 for an access road for the Montana Tunnels
Project in T7N, R4W, Sections 9, 15 and 16, renewed by Montana
Tunnels Mining, Inc. on February 22,
2006;
|
|
17
|
Sublease
Agreement, dated March 1, 1998, between Montana Rail Link, Inc., The
Burlington Northern and Santa Fe Railway Company and Montana Tunnels
Mining, Inc.;
|
|
18
|
Easement
Agreement, dated September 19, 1988, between ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
(personal representative of the Estate of ▇▇▇▇▇▇ ▇. and ▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇ and Pegasus Gold Corporation and Montana Tunnels Mining Inc.
(a
Nevada corporation);
|
|
19
|
Collateral
Trust Agreement, dated September 26, 2002, between Montana Tunnels
Mining, Inc., Western Surety Company and The Northern Trust
Company;
|
page
75
|
|
Schedule 8 Material
Agreements
|
|
20
|
Any
agreement which amends, varies, restates or replaces, any of the
agreements listed in paragraphs 1 to 19 above; and
|
|
21
|
Each
agreement the Borrower and the Agent agree is a Material Agreement
for the
purposes of this agreement.
|
page
76
Schedule
9
RMB
GSA
Date
►
|
Between
the parties
|
|
|
Apollo
Gold Corporation
a
corporation existing under the laws of the Yukon Territory,
Canada
of
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ Village, Colorado
80111-3220 United States of America
(APG)
|
|
|
Financier
|
RMB
Australia Holdings Limited
of
▇▇▇▇▇ ▇▇, ▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, New South Wales, 2000
Australia
(Financier)
|
|
Agent
|
RMB
Resources Inc.
of
▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇ of
America
(Agent, and
collectively with the Financier
the Finance
Parties)
|
|
Background
|
4
The
Financier has agreed to make certain credit facilities available
to
Montana Tunnels Mining, Inc. (Montana
Tunnels)
on the terms and conditions contained in a facility agreement
(Facility
Agreement)
between APG, Apollo Gold Inc., Montana Tunnels, certain other parties
and
the Finance Parties dated as of the date of this agreement (as amended,
supplemented, modified, extended, renewed, novated, refinanced, restated
or replaced from time to time).
5
Montana
Tunnels has entered into commodity hedging arrangements with the
Financier
pursuant to an ISDA Master Agreement made on or about the date of
this
Agreement (ISDA
Master Agreement,
and collectively with the Facility Agreement, the Facility
Agreements).
6
APG
has agreed to execute and deliver this agreement to and in favour
of the
Finance Parties as security for the payment and performance of Montana
Tunnels’ obligations to the Finance Parties under the Facility Agreements.
|
|
The
parties agree
|
In
consideration of, among other things, the mutual promises contained
in
this agreement and other good and valuable consideration (the receipt
and
adequacy of which is acknowledged), APG agrees as follows:
|
page
77
|
|
Schedule 9 RMB
GSA
|
Operative
part
This
paragraph provides padding and has been hidden deliberately. Do not delete
or
unhide this paragraph.
| 1 |
Security
|
| 1.1 |
Terms
incorporated by reference
|
Terms
defined in:
| (a) |
the
Personal
Property Security Act
(Yukon Territory) (as amended from time to time) (PPSA);
or
|
| (b) |
the
Facility Agreements,
|
which
are
used in this agreement will have the same meanings in this agreement unless
the
context requires otherwise.
| 1.2 |
Grant
of security
|
Subject
to clauses 1.3 and 1.6, APG grants to each of the Finance Parties a security
interest in all APG’s right, title and interest in and to all presently owned
and hereafter acquired property, assets and undertaking of APG including all
of
the present and after acquired personal property of APG’s (collectively, the
Collateral)
and
including, without limitation, any and all of APG’s:
| (a) |
inventory
including goods held for sale, lease or resale, goods furnished or
to be
furnished to third parties under contracts of lease, consignment
or
service, goods which are raw materials or work in process, goods
used in
or procured for packing and materials used or consumed in the business
of
APG;
|
| (b) |
equipment,
machinery, furniture, fixtures, plants, vehicles and other goods
of every
kind and description and all licences and other rights (including
all
mining and exploration rights and licenses) and all records, files,
charts, plans, drawings, specifications, manuals and documents relating
to
those items;
|
| (c) |
accounts
due or accruing due, the credit balance and all on deposit in those
accounts, and all agreements, books, accounts, invoices, letters,
documents and papers recording, evidencing or relating to those
accounts;
|
| (d) |
money,
documents of title, chattel paper, instruments, share capital and
securities;
|
| (e) |
intangibles
including all security interests, goodwill, choses in action and
contractual rights, interests and benefits, and all trade-marks,
trade-▇▇▇▇ registrations and pending trade-▇▇▇▇ applications, patents
and
pending patent applications and copyrights and other intellectual
property;
|
| (f) |
substitutions
and replacements of and increases, additions and, where applicable,
accessions to the property, rights, interests or benefits described
in
clause 1.2(a) to clause 1.2(e) inclusive;
and
|
page
78
|
|
Schedule 9 RMB
GSA
|
| (g) |
proceeds
in any form derived directly or indirectly from any dealing with
all or
any part of the property, rights, interests or benefits described
in
clause 1.2(a) to 1.2(f) inclusive of the proceeds of those
proceeds.
|
| 1.3 |
Excepted
Mining Claims
|
The
parties acknowledge and agree that:
| (a) |
the
security interest granted by APG to each of the Finance Parties under
clause 1.2 does not include a security interest over APG’s right, title
and interest in the following mining claims situate in the Townships
of
▇▇▇▇▇▇ and ▇▇▇▇▇▇ in the Larder ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇:
|
|
(1)
|
L1048333
|
|
(2)
|
L1048334;
|
|
(3)
|
L1048335;
|
|
(4)
|
L1115059;
and
|
|
(5)
|
L1113087,
|
|
(6)
|
(each,
an Excepted
Mining Claim);
and
|
| (b) |
if
APG acquires by any means any right, title or interest (New
Acquisition)
that enables APG to mine, explore or otherwise use any land the subject
of
an Excepted Mining Claim, the security interest granted by APG to
each of
the Finance Parties under clause 1.2 will include a security interest
in
that New Acquisition.
|
| 1.4 |
Obligations
secured
|
| (a) |
The
security interest granted in this agreement (Security
Interest)
secures the payment and performance of all debts, liabilities and
obligations present or future, direct or indirect, absolute or contingent,
matured or unmatured at any time or from time to time due or accruing
due
and owing, including all charges and fees of the Finance Parties
due
from APG, to the Finance Parties pursuant to or in connection with
the
Transaction Documents (collectively,
and together with the expenses, costs and charges set out in clause
1.4(b), the Obligations).
|
| (b) |
All
expenses, costs and charges incurred by or on behalf of the Finance
Parties in connection with this agreement, the Security Interest
or the
Collateral, including all legal fees, court costs, receiver's or
agent's
remuneration and other expenses of taking possession of, repairing,
protecting, insuring, preparing for disposition, realizing, collecting,
selling, transferring, delivering or obtaining payment of the Collateral
or other lawful exercises of the powers conferred by the Transaction
Documents, and of taking, defending or participating in any action
or
proceeding in connection with any of those matters or otherwise in
connection with the Finance Parties’ interest in any Collateral, whether
or not directly relating to the enforcement of this agreement or
the
Facility Agreements, will be added to and form a part of the
Obligations.
|
| 1.5 |
Attachment
|
| (a) |
APG
acknowledges that:
|
|
(1)
|
value
has been given;
|
|
(2)
|
it
has rights in the Collateral (other than after-acquired
Collateral);
|
|
(3)
|
it
has not agreed to postpone the time of attachment of the Security
Interest; and
|
|
(4)
|
it
has received a duplicate original copy of this
agreement.
|
page
79
|
|
Schedule 9 RMB
GSA
|
| (b) |
APG
will promptly inform the Finance Parties in writing of the acquisition
by
APG of any personal property which is not adequately described in
this
agreement, and APG will execute and deliver, at its own expense,
from time
to time, amendments to this agreement or additional agreements as
may be
required by the Finance Parties.
|
| 1.6 |
Scope
of Security Interest
|
| (a) |
The
Collateral does not include and the Security Interest will not extend
to
consumer goods.
|
| (b) |
The
Security Interest will not extend or apply to the last day of the
term of
any lease or sublease or any agreement for a lease or sublease now
held or
subsequently acquired by APG in respect of real property, but APG
will
stand possessed of that last day on trust to assign and dispose of
it as
the Finance Parties may direct.
|
| (c) |
To
the extent that an assignment of amounts payable and other proceeds
arising under or in connection with, or the grant of a security interest
in any agreement, licence, permit or quota of APG would result in
the
termination of that agreement, licence, permit or quota (each, a
Restricted
Asset),
the Security Interest with respect to each Restricted Asset will
constitute a trust created in favour of the Finance Parties pursuant
to
which APG holds as trustee all proceeds arising under or in connection
with the Restricted Asset in trust for the Finance Parties on the
following basis:
|
|
(1)
|
until
the Security Interest is enforceable and subject to the Facility
Agreements, APG is entitled to receive all those proceeds;
and
|
|
(2)
|
whenever
the Security Interest is
enforceable:
|
|
·
|
all
rights of APG to receive those proceeds cease and all those proceeds
will
be immediately paid over to the Finance Parties;
and
|
|
·
|
APG
will take all actions requested by the Finance Parties to collect
and
enforce payment and other rights arising under the Restricted
Asset.
|
| 1.7 |
Care
and custody of Collateral
|
| (a) |
The
Finance Parties will have no obligation to keep Collateral in their
possession from time to time, if any,
identifiable.
|
| (b) |
The
Finance Parties may, both before and after the Security Interest
has
become enforceable:
|
|
(1)
|
notify
any person obligated on an account or on chattel paper or any obligor
on
an instrument to make payments to the Finance Parties whether or
not APG
was previously making collections on those accounts, chattel paper
or
instruments; and
|
|
(2)
|
assume
control of any proceeds arising from the
Collateral.
|
| 1.8 |
Amalgamation
|
APG
acknowledges and agrees that if it amalgamates or merges with or into any other
corporation or corporations, then:
| (a) |
the
term APG will extend to and include the continuing corporation from
that
amalgamation or merger;
|
| (b) |
the
term "Obligations" will extend to and include the Obligations of
each of
the amalgamating or merging corporations at the time of that amalgamation
or merger arising after that amalgamation or merger;
and
|
page
80
|
|
Schedule 9 RMB
GSA
|
| (c) |
the
Collateral secured in this agreement and the Security Interests over
the
Collateral of APG will extend to and include all of the property,
assets
and undertakings of each of the amalgamating or merging corporations
at
the time of that amalgamation or merger and any and all property,
assets
and undertakings of the continuing corporation from that amalgamation
or
merger owned or acquired by that continuing corporation after that
amalgamation or merger.
|
| 2 |
Representations
and warranties of the corporation
|
| 2.1 |
Representations
and warranties
|
APG
represents and warrants to the Finance Parties as follows, and acknowledges
that
the Finance Parties are relying on those representations and warranties in
connection with this agreement:
| (a) |
Incorporation
and qualification:
APG is a corporation incorporated and validly existing under the
laws of
the Yukon Territory, Canada.
|
| (b) |
Corporate
power:
APG has all the requisite corporate power and authority
to:
|
|
(1)
|
own,
lease and operate its properties and assets and to carry on its business
as now being conducted by it; and
|
|
(2)
|
enter
into and perform its obligations under this
agreement.
|
| (c) |
Conflict
with other instruments:
The execution and delivery by APG and the performance by it of its
obligations under, and compliance with the terms, conditions and
provisions of this agreement do not and will not violate any law,
regulation, authorisation, ruling, consent, judgment, order or decree
of a
governmental agency, its constating documents or by-laws, or an
Encumbrance or document which is binding on it or on its
assets.
|
| (d) |
Execution
and binding obligation:
This agreement has been duly executed and delivered by APG and constitute
legal, valid and binding obligations of APG enforceable against it
in
accordance with its terms, subject only to any limitation under applicable
laws relating to:
|
|
(1)
|
bankruptcy,
insolvency, arrangement or creditors' rights generally; and
|
|
(2)
|
the
discretion that a court may exercise in the granting of equitable
remedies.
|
| (e) |
Continuous
perfection: The
Schedule sets out APG’s place of business or, if more than one, APG’s
chief executive office. APG will not change these locations without
providing at least 30 days’ prior written notice to the Finance
Parties.
|
| 2.2 |
Representations
and warranties in Transaction
Documents
|
Notwithstanding
the representations and warranties of APG set forth in clause 2.1 of this
agreement, APG further represents and warrants to the Finance Parties, and
further acknowledges that the Finance Parties are relying on those
representations and warranties in connection with this agreement, that the
representations and warranties of APG contained in the Transaction Documents
are
true and correct in all respects as of the date of this agreement.
| 2.3 |
Survival
of representations and
warranties
|
The
representations and warranties in this agreement and in any certificates or
documents delivered to the Finance Parties will not merge in or be prejudiced
by
and will survive any advance and will continue in full force and effect so
long
as any amounts are owing by APG to the Finance Parties under the Transaction
Documents.
page
81
|
|
Schedule 9 ▇▇▇
▇▇▇
|
| ▇ |
Enforcement
|
| 3.1 |
Enforcement
|
The
Security Interest will be and become enforceable against APG if
and
when APG fails to repay or perform any of the Obligations when due and payable
or when due to be performed, as the case may be, or on
the
occurrence and during the continuance of an Event of Default (as specified
in
clause 11 of the Facility Agreement and
Section
5 of the ISDA Master Agreement).
| 3.2 |
Remedies
|
| (a) |
Subject
to clause 3.2(b), whenever the Security Interest has become enforceable,
the Finance Parties may realize on the Collateral and enforce their
rights
by:
|
|
(1)
|
entry
onto any premises where Collateral consisting of tangible personal
property may be located;
|
|
(2)
|
entry
into possession of the Collateral by any method permitted by
law;
|
|
(3)
|
sale
or lease of all or any part of the
Collateral;
|
|
(4)
|
collection
of any proceeds arising in respect of the
Collateral;
|
|
(5)
|
collection,
realization or sale of, or other dealing with, the
accounts;
|
|
(6)
|
appointment
by instrument in writing of a receiver (which term as used in this
agreement includes a receiver and manager) or agent of all or any
part of
the Collateral and removal or replacement from time to time of any
receiver or agent;
|
|
(7)
|
institution
of proceedings in any court of competent jurisdiction for the appointment
of a receiver of all or any part of the
Collateral;
|
|
(8)
|
institution
of proceedings in any court of competent jurisdiction for sale or
foreclosure of all or any part of the
Collateral;
|
|
(9)
|
filing
of proofs of claim and other documents to establish claims to the
Collateral in any proceeding relating to
APG;
|
|
(10)
|
any
other remedy or proceeding authorized or permitted under the PPSA
or
otherwise by law or equity; and
|
|
(11)
|
application
of any moneys constituting Collateral or proceeds of
Collateral.
|
| (b) |
The
remedies referred to in clause 3.2(a) may be exercised from time
to time
separately or in combination and are in addition to, and not in
substitution for, any other rights of the Finance Parties however
created.
The Finance Parties will not be bound to exercise any right or remedy,
and
the exercise of any rights and remedies will be without prejudice
to the
rights of the Finance Parties in respect of the Obligations including
the
right to claim for any deficiency.
|
| 3.3 |
Additional
rights
|
In
addition to the remedies referred to in clause 3.2, the Finance Parties may,
whenever the Security Interest has become enforceable:
page
82
|
|
Schedule 9 RMB
GSA
|
| (a) |
require
APG, at APG's expense, to assemble the Collateral at a place or places
designated by notice in writing and APG agrees to so assemble the
Collateral;
|
| (b) |
require
APG, by notice in writing, to disclose to the Finance Parties the
location
or locations of the Collateral and APG agrees to make that disclosure
when
so required;
|
| (c) |
repair,
process, modify, complete or otherwise deal with the Collateral and
prepare for the disposition of the Collateral, whether on the premises
of
APG or otherwise;
|
| (d) |
carry
on all or any part of the business of APG and, to the exclusion of
all
others including APG, enter on, occupy and use all or any of the
premises,
buildings, and other property of or used by APG for that time as
the
Finance Parties see fit, free of charge, and the Finance Parties
will not
be liable to APG for any act, omission or negligence in so doing
or for
any rent, charges, depreciation or damages incurred in connection
with or
resulting from that action;
|
| (e) |
require
APG to engage a consultant or consultants of the Finance Parties’ sole
choice, that consultant to receive the full cooperation and support
of APG
and its directors, officers and employees, including unrestricted
access
to the premises and books and records of APG; all reasonable fees
and
expenses of that consultant will be for the account of APG and APG
authorizes that consultant to report directly to the Finance Parties
and
to disclose to the Finance Parties any and all information obtained
by
that consultant;
|
| (f) |
borrow
for the purpose of carrying on the business of APG or for the maintenance,
preservation or protection of the Collateral and grant a security
interest
in the Collateral, whether or not in priority to the Security Interest,
to
secure repayment;
|
| (g) |
commence,
continue or defend any judicial or administrative proceedings for
the
purpose of protecting, seizing, collecting, realizing or obtaining
possession or payment of the Collateral, and give good and valid
receipts
and discharges in respect of the Collateral and compromise or give
time
for the payment or performance of all or any part of the accounts
or any
other obligation of any third party to APG;
and
|
| (h) |
require
APG to execute and deliver any and all instruments, documents, notices
or
writings necessary to permit the Finance Parties to realize on and
enforce
their rights to any of the
Collateral.
|
| 3.4 |
Receiver's
powers
|
| (a) |
Any
receiver appointed by the Finance Parties will be vested with the
rights
and remedies which could have been exercised by the Finance Parties
in
respect of APG or the Collateral and those other powers and discretions
as
are granted in the instrument of appointment and any supplemental
instruments. The identity of the receiver, its replacement and its
remuneration will be within the sole and unfettered discretion of
the
Finance Parties.
|
| (b) |
Any
receiver appointed by the Finance Parties will act as agent for the
Finance Parties for the purposes of taking possession of the Collateral,
but otherwise and for all other purposes (except as provided below),
as
agent for APG. The receiver may sell, lease, or otherwise dispose
of
Collateral as agent for APG or as agent for the Finance Parties as
the
Finance Parties may determine in their discretion. APG agrees to
ratify
and confirm all actions of the receiver acting as agent for APG,
and to
release and indemnify the receiver in respect of all those
actions.
|
| (c) |
The
Finance Parties, in appointing or refraining from appointing any
receiver,
will not incur liability to the receiver, APG or otherwise and will
not be
responsible for any misconduct or negligence of the
receiver.
|
page
83
|
|
Schedule 9 RMB
GSA
|
| 3.5 |
Appointment
of attorney
|
APG
irrevocably appoints each of the Finance Parties (including any officer or
agent
of a Finance Party), acting separately or together, as attorney of APG (with
full power of substitution) to do, make and execute, in the name of and on
behalf of APG, on
the
occurrence and during the continuance of an Event of Default and at any other
time
that the
Security Interest will be enforceable, all further acts, documents, matters
and
things which a Finance Party may deem necessary or advisable to accomplish
the
purposes of this agreement including the execution, endorsement and delivery
of
documents and any notices, receipts, assignments or verifications of the
accounts. This power of attorney is irrevocable, is coupled with an interest,
has been given for valuable consideration (the receipt and adequacy of which
is
acknowledged) and survives and does not terminate upon the bankruptcy,
dissolution, winding up or insolvency of APG. All acts of the attorney are
ratified and approved, and the attorney will not be liable for any act, failure
to act or any other matter or thing, other than arising out of its own wilful
misconduct, fraud or gross negligence.
| 3.6 |
Dealing
with the Collateral
|
| (a) |
The
Finance Parties will not be obliged to exhaust their recourse against
APG
or any other person or against any other security they may hold in
respect
of the Obligations before realizing on or otherwise dealing with
the
Collateral in any manner as the Finance Parties may consider
desirable.
|
| (b) |
The
Finance Parties may grant extensions or other indulgences, take and
give
up securities, accept compositions, grant releases and discharges
and
otherwise deal with APG and with other persons, sureties or securities
as
they may see fit without prejudice to the Obligations, the liability
of
APG or the rights of the Finance Parties in respect of the
Collateral.
|
| (c) |
Except
as otherwise provided by law or this agreement, the Finance Parties
will
not be:
|
|
(1)
|
liable
or accountable for any failure to collect, realize or obtain payment
in
respect of the Collateral;
|
|
(2)
|
bound
to institute proceedings for the purpose of collecting, enforcing,
realizing or obtaining payment of the Collateral or for the purpose
of
preserving any rights of any persons in respect of the
Collateral;
|
|
(3)
|
responsible
for any loss occasioned by any sale or other dealing with the Collateral
or by the retention of or failure to sell or otherwise deal with
the
Collateral; or
|
|
(4)
|
bound
to protect the Collateral from depreciating in value or becoming
worthless.
|
| 3.7 |
Standards
of sale
|
Without
prejudice to the ability of the Finance Parties to dispose of the Collateral
in
any manner which is commercially reasonable, APG acknowledges that:
| (a) |
Collateral
may be disposed of in whole or in
part;
|
| (b) |
Collateral
may be disposed of by public auction, public tender or private contract,
with or without advertising and without any other
formality;
|
| (c) |
any
assignee of that Collateral may be a customer of the Finance
Parties;
|
| (d) |
a
disposition of Collateral may be on those terms and conditions as
to
credit or otherwise as the Finance Parties, in their sole discretion,
may
deem advantageous; and
|
| (e) |
the
Finance Parties may establish an upset or reserve bid or price in
respect
of Collateral.
|
page
84
|
Schedule
9 RMB
GSA
|
| 3.8 |
Dealings
by third parties
|
| (a) |
No
person dealing with the Finance Parties or an agent or receiver will
be
required to determine:
|
|
(1)
|
whether
the Security Interest has become enforceable;
|
|
(2)
|
whether
the powers which that person is purporting to exercise have become
exercisable;
|
|
(3)
|
whether
any money remains due to the Finance Parties by APG;
|
|
(4)
|
the
necessity or expediency of the stipulations and conditions subject
to
which any sale or lease is made;
|
|
(5)
|
the
propriety or regularity of any sale or other dealing by the Finance
Parties with the Collateral; or
|
|
(6)
|
how
any money paid to the Finance Parties has been
applied.
|
| (b) |
Any
bona fide purchaser of all or any part of the Collateral from the
Finance
Parties or a receiver or agent will hold the Collateral absolutely,
free
from any claim or right of whatever kind, including any equity of
redemption, of APG, which it specifically waives (to the fullest
extent
permitted by law) as against any purchaser together with all rights
of
redemption, stay or appraisal which APG has or may have under any
rule of
law or statute now existing or adopted in the
future.
|
| 4 |
General
|
| 4.1 |
Discharge
|
| (a) |
The
Security Interest will be discharged on, but only
on:
|
|
(1)
|
full
payment and performance of the Obligations; and
|
|
(2)
|
the
Transaction Parties having no obligations under the Facility
Agreements.
|
| (b) |
On
discharge of the Security Interest and at the request and expense
of APG,
the Finance Parties will execute and deliver to APG those releases
and
discharges as APG may reasonably
require.
|
| 4.2 |
Amendments
|
No
amendment or waiver of any provision of this agreement, nor consent to any
departure by APG from those provisions, is effective unless in writing and
approved by the Finance Parties. Any amendment, waiver or consent is effective
only in the specific instance and for the specific purpose for which it was
given.
| 4.3 |
Waivers
|
No
failure on the part of the Finance Parties to exercise, and no delay in
exercising, any right under this agreement will operate as a waiver of that
right; nor will any single or partial exercise of any right under this agreement
preclude any other or further exercise of that right or the exercise of any
other right.
page
85
|
|
Schedule
9 RMB
GSA
|
| 4.4 |
No
merger
|
This
agreement will not operate by way of merger of any of the Obligations and no
judgment recovered by the Finance Parties will operate by way of merger of,
or
in any way affect, the Security Interest, which is in addition to, and not
in
substitution for, any other security now or subsequently held by the Finance
Parties in respect of the Obligations.
| 4.5 |
Further
assurances
|
| (a) |
APG
will, from time to time, whether before or after the Security Interest
has
become enforceable, do all acts and things and execute and deliver
all
transfers, assignments and instruments as the Finance Parties may
reasonably require for:
|
|
(1)
|
protecting
the Collateral;
|
|
(2)
|
perfecting
the Security Interest; and
|
|
(3)
|
exercising
all powers, authorities and discretions conferred on the Finance
Parties.
|
| (b) |
APG
will, from time to time after the Security Interest has become
enforceable, do all acts and things and execute and deliver all transfers,
assignments and instruments as the Finance Parties may require for
facilitating the sale or other disposition of the Collateral in connection
with its realization.
|
| 4.6 |
Supplemental
security
|
This
agreement is in addition to and without prejudice to and is supplemental to
all
other security now held or which may subsequently be held by the Finance
Parties.
| 4.7 |
Notices
|
Any
notices, directions or other communications provided for in this agreement
must
be in writing and given in accordance with the provisions of the Facility
Agreements.
| 4.8 |
Successors
and assigns
|
This
agreement is binding on APG, its successors and assigns, and enures to the
benefit of the Finance Parties and their successors and assigns. All rights
of
the Finance Parties are assignable and in any action brought by an assignee
to
enforce any of those rights, APG will not assert against the assignee any claim
or defence which APG now has or may have against the Finance
Parties.
| 4.9 |
Waiver
and Variation
|
| (a) |
Waiver
of a Power arising under, or a provision of, this agreement (including
this clause), must be in writing and signed by the party granting
the
waiver.
|
| (b) |
A
failure or delay in exercise, or partial exercise, of a Power (arising
on
the occurrence of an Event of Default or otherwise) does not operate
as a
waiver of that Power or preclude another or further exercise of that
or
another Power.
|
| (c) |
Any
variation of a term of this agreement must be in writing and signed
by the
parties.
|
page
86
|
|
Schedule
9 RMB
GSA
|
| 4.10 |
Gender
and number
|
Any
reference in this agreement to gender includes all genders and words importing
the singular number includes the plural and vice versa.
| 4.11 |
Headings
|
The
division of this agreement into clauses and the insertion of headings are for
convenient reference only and are not to affect its interpretation.
| 4.12 |
Language
|
The
parties to this agreement expressly request and require that this agreement
and
all related documents be drafted in English. Les
parties aux présentes conviennent et exigent que cette convention et tous les
documents qui s'y rattachent soient rédigés en anglais.
| 4.13 |
Severability
|
If
any
provision of this agreement is taken by any court of competent jurisdiction
to
be invalid or void, the remaining provisions will remain in full force and
effect.
| 4.14 |
Governing
law
|
This
agreement is governed by and interpreted and enforced in accordance with the
laws of the Yukon Territory and the laws of Canada which are applicable in
the
Yukon Territory.
[insert
relevant execution clauses]
page
87
|
|
Schedule
9 RMB
GSA
|
Schedule
1 – Notices
Notice
details
|
Apollo
Gold Corporation
|
|
|
Address
|
5655
South Yosemite Street, Suite ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America
|
|
Attention
|
R.
▇▇▇▇▇ ▇▇▇▇▇▇▇
|
|
Phone
|
▇▇
▇▇▇ ▇▇▇ ▇▇▇▇
|
|
Fax
|
▇▇
▇▇▇ ▇▇▇ ▇▇▇▇
|
|
Email
|
▇▇▇▇▇▇▇▇▇@▇▇▇.▇▇▇
|
|
Financier
|
RMB
Australia Holdings Limited
|
|
Address
|
Level
13, ▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇,▇▇▇▇▇▇▇▇▇
|
|
Attention
|
▇▇▇▇▇▇▇
▇▇▇
|
|
Phone
|
▇▇▇
▇ ▇▇▇▇ ▇▇▇▇
|
|
Fax
|
▇▇▇
▇ ▇▇▇▇ ▇▇▇▇
|
|
Email
|
▇▇▇▇.▇▇▇@▇▇▇.▇▇▇.▇▇
|
|
Agent
|
RMB
Resources Inc.
|
|
Address
|
Suite
900, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇
of
America
|
|
Attention
|
▇▇▇▇
▇▇▇▇▇▇▇
|
|
Phone
|
▇▇
▇▇▇ ▇▇▇ ▇▇▇▇
|
|
Fax
|
▇▇
▇▇▇ ▇▇▇ ▇▇▇▇
|
|
Email
|
▇▇▇▇.▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
|
page
88
|
|
Schedule
9 RMB
GSA
|
Schedule
2 – APG place of business
Address: ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇
▇▇▇
▇▇▇▇▇▇▇▇▇ Village
Colorado
80111-3220
United
States of America
Contact: R.
▇▇▇▇▇
▇▇▇▇▇▇▇
Facsimile: ▇▇
▇▇▇
▇▇▇ ▇▇▇▇
page
89
Schedule
10
Key
Mineral Rights
FEE
LANDS
|
Acres
|
|||||||
| T. 7 N., R. 4 W., Jefferson County, Montana | |||||||
|
|
Tract
A (Tract 1) of Certificate of Survey No. 21135, Folio 646-B; Tract
A of
Certificate of Survey No. 216150, Folio 678-B; ▇▇▇ ▇, ▇▇▇
▇
|
263.00
|
|||||
|
Section
4:
|
S1/2SW1/4,
Lot 10; Surface only: ▇▇▇▇ ▇▇, ▇▇, ▇▇, ▇▇, ▇▇, ▇▇, ▇▇ (▇▇▇▇ 20-acre
▇▇▇▇▇▇▇▇ Tract - reconveyed to ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ in 1996)
|
|
218.68
|
||||
|
Section
5:
|
SE1/4SE1/4;
Lot 11; SE1/4SW1/4; Surface only: Lots 6, 19; SW1/4SW1/4
|
221.19
|
|||||
|
Section
8:
|
▇▇▇▇
▇▇, ▇▇, ▇▇, ▇▇, ▇▇, ▇▇, ▇▇, ▇▇, 32, 33, 35, 36, 37, 39, 40, 41,
43, 44;
Surface only: Lot 38
|
335.98
|
|||||
|
Section
9:
|
N1/2NW1/4;
NW1/4NE1/4; N1/2SW1/4SW1/4; N1/2S1/2SW1/4SW1/4; SW1/4NW1/4; NW1/4SW1/4;
Surface only: Lots 3, 8, 9, 18
|
354.12
|
|||||
|
Section
16:
|
W1/2NW1/4;
SE1/4NW1/4; SW1/4NE1/4NW/4; N1/2SW1/4; SW1/4SW1/4; NOTE: This description
includes all of Placer 2578, being the N1/2NW1/4NW1/4; SW1/4NE1/4NW1/4
and
the NE1/4SE1/4NW1/4; EXCEPTING THEREFROM 2 parcels of land described
in
Book “U” of Deeds, page 229 and Book 18 of Deeds, Pg 418
|
250.00
|
|||||
|
Section
17:
|
▇▇▇▇
▇, ▇, ▇, ▇, ▇, ▇, ▇, ▇, ▇▇, 11, 12, 13, 14, 15, 16, 17 - Except
Parcel in
Lots 5 & 7, described in Bk 61 deeds, Pg 38
|
394.24
|
|||||
|
T.
7 N., R. 3 W., Jefferson County,
Montana
|
|||||||
|
Section
6:
|
Parcel
“A” - COS #132231, Folio 257C
|
2.603
|
|||||
|
T.
1 N., R. 12 W., Silver Bow County, Montana
|
|||||||
|
Section
1:
|
Parcels
2 & 3 - COS #285-A
|
19.92
|
|||||
page
90
PATENTED
MINING CLAIMS
|
A.
|
The
following patented mining claims, all located in Jefferson County,
Montana, are identified by U.S. Mineral Survey Number, Section, Township
and Range.
|
|
NAME OF CLAIM
|
U.S. MS NO.
|
Section
|
Township &
Range |
|||
|
Placer
|
213
|
9,
16
|
7N4W
|
|||
|
Placer
|
258
|
8
|
7N4W
|
|||
|
▇▇▇▇▇
|
▇▇▇
|
▇
|
▇▇▇▇
|
|||
|
▇▇▇▇▇
|
381
|
8
|
7N4W
|
|||
|
North
Pacific, ▇▇▇ ▇▇▇
|
▇▇▇
|
▇
|
▇▇▇▇
|
|||
|
▇▇▇
▇▇▇
|
▇▇▇
|
▇
|
7N4W
|
|||
|
Somewhere
|
734
|
9
|
7N4W
|
|||
|
North
Atlantic
|
1649
|
9
|
7N4W
|
|||
|
Hillside
|
1870
|
7,
18
|
7N4W
|
|||
|
Homestake
|
2025
|
8
|
7N4W
|
|||
|
Iowa
|
2026
|
8,
17
|
7N4W
|
|||
|
Iron
Dollar
|
2027
|
8
|
7N4W
|
|||
|
General
▇▇▇▇▇▇
|
2038
|
8
|
7N4W
|
|||
|
Leadville
|
2038
|
7,
8
|
7N4W
|
|||
|
▇▇▇▇▇
B
|
2064
|
8
|
7N4W
|
|||
|
Flagstaff
|
2122
|
▇,
▇
|
▇▇▇▇
|
|||
|
▇▇▇▇▇▇▇
|
▇▇▇▇
|
▇
|
▇▇▇▇
|
|||
|
▇▇▇
▇▇▇▇▇ Millsite, ▇▇▇ ▇
|
▇▇▇▇
|
▇,
▇▇
|
▇▇▇▇
|
|||
|
▇▇▇
▇▇▇▇▇, ▇▇▇ A
|
4747
|
8,
17
|
7N4W
|
|||
|
Blizzard
|
5456
|
17,
18
|
7N4W
|
|||
|
Superior
|
7582
|
23
|
7N4W
|
|||
|
Tamarack
▇▇.
|
▇▇▇▇
|
▇▇
|
▇▇▇▇
|
|||
|
▇▇▇▇▇▇▇
|
▇▇▇▇
|
▇▇
|
▇▇▇▇
|
|||
|
▇▇▇▇▇▇
|
7585
|
14,
23
|
7N4W
|
|||
|
Seva
|
7587
|
22
|
7N4W
|
|||
|
Golden
Star
|
7588
|
22
|
7N4W
|
|||
|
Red
Rock
|
7589
|
22
|
7N4W
|
|||
|
Fraction
|
7590
|
22
|
7N4W
|
|||
|
Copper
King
|
7591
|
22,
23
|
7N4W
|
|||
|
Elk
|
8241
|
15
|
7N4W
|
|||
|
Jockey
Boy
|
8242
|
15
|
7N4W
|
|||
|
American
Mint
|
8243
|
15
|
7N4W
|
|||
|
Song
Bird
|
8244
|
15
|
7N4W
|
|||
|
Ruby
|
8245
|
15
|
7N4W
|
page
91
|
NAME OF CLAIM
|
U.S. MS NO.
|
Section
|
Township &
Range |
|||
|
Daisy
|
8246
|
15
|
7N4W
|
|||
|
Monitor
|
8247
|
15
|
7N4W
|
|||
|
Blue
Rock
|
8248
|
9,
10, 15, 16
|
7N4W
|
|||
|
Basin
|
8249
|
10,
15
|
7N4W
|
|||
|
Mammoth
|
8250
|
10,
15
|
7N4W
|
|||
|
Wickes
|
8251
|
10,
15
|
7N4W
|
|||
|
Covellite
|
8252
|
10,
15
|
7N4W
|
|||
|
▇▇▇
Boy
|
8253
|
10
|
7N4W
|
|||
|
Chalcopgeite
|
8254
|
10
|
7N4W
|
|||
|
Jumper
|
8255
|
10
|
7N4W
|
|||
|
Equator
|
8256
|
10
|
7N4W
|
|||
|
▇▇▇▇▇
No. 1
|
8444
|
9,
16
|
7N4W
|
|||
|
▇▇▇▇▇
▇▇. ▇
|
▇▇▇▇
|
▇
|
▇▇▇▇
|
|||
|
▇▇▇▇▇▇
|
8854
|
9
|
7N4W
|
|||
|
Butte
|
8854
|
9
|
7N4W
|
|||
|
Fair
Trial
|
8854
|
10
|
7N4W
|
|||
|
▇▇▇▇
▇▇▇
|
8865
|
10,
15
|
7N4W
|
|||
|
▇▇▇▇▇▇
▇.
|
8939
|
17
|
7N4W
|
|||
|
▇▇▇▇▇▇
|
8940
|
7,
12
|
7N4W,
7N5W
|
|||
|
▇▇▇▇▇▇▇▇▇
|
8940
|
7,
12
|
7N4W,
7N5W
|
|||
|
▇▇▇▇▇
|
▇▇▇▇
|
▇,
▇▇
|
▇▇▇▇,
▇▇▇▇
|
|||
|
▇▇▇▇▇▇
|
8940
|
12
|
7N5W
|
|||
|
▇▇▇▇
|
8940
|
7,
8
|
7N4W
|
|||
|
Black
Rock ▇▇. ▇
|
▇▇▇▇
|
▇,
▇
|
▇▇▇▇
|
|||
|
▇▇▇▇▇▇▇
|
8940
|
7
|
7N4W
|
|||
|
Chief
▇▇▇▇▇▇
|
8940
|
12
|
7N5W
|
|||
|
Col
▇▇▇▇▇▇
|
8940
|
7
|
7N4W
|
|||
|
Dow
|
8940
|
7
|
7N4W
|
|||
|
▇▇▇▇▇▇▇
|
8940
|
12
|
7N5W
|
|||
|
F.E.R.
(FRACTION)
|
8940
|
7
|
7N4W
|
|||
|
▇▇▇▇▇▇▇
▇▇. ▇
|
▇▇▇▇
|
▇
|
▇▇▇▇
|
|||
|
▇▇▇▇▇▇▇
No.2
|
8940
|
7
|
7N4W
|
|||
|
▇▇▇▇▇▇▇▇▇
|
8940
|
12
|
7N5W
|
|||
|
▇▇▇▇▇▇▇▇
|
8940
|
7
|
7N4W
|
|||
|
Pine
Ridge
|
8940
|
7
|
7N4W
|
|||
|
Prosper
|
8940
|
7
|
7N4W
|
|||
|
Tell
|
8940
|
7
|
7N4W
|
page
92
|
NAME OF CLAIM
|
U.S. MS NO.
|
Section
|
Township &
Range |
|||
|
T.F.C.
|
8940
|
7
|
7N4W
|
|||
|
Black
Rock No. 3
|
8940
|
7,
8
|
7N4W
|
|||
|
May
Bird
|
8946
|
9,
16
|
7N4W
|
|||
|
Columbia
|
9080
|
15,
16
|
7N4W
|
|||
|
▇▇▇▇▇▇
R
|
9081
|
21
|
7N4W
|
|||
|
Highland
|
9082
|
9,
10
|
7N4W
|
|||
|
▇▇▇▇
|
▇▇▇▇
|
▇▇
|
▇▇▇▇
|
|||
|
▇▇▇▇▇
▇▇▇▇
|
9082
|
9,
10
|
7N4W
|
|||
|
Spring
|
9082
|
9,
10
|
7N4W
|
|||
|
Tunnel
|
9082
|
9,
10
|
7N4W
|
|||
|
Learned
|
9183
|
11
|
7N5W
|
|||
|
Black
Rock #2
|
9184
|
8
|
7N4W
|
|||
|
▇▇▇▇▇▇▇▇▇▇
|
9184
|
7
|
7N4W
|
|||
|
D.E.D.
|
9184
|
8
|
7N4W
|
|||
|
▇▇▇▇▇▇▇▇▇
▇.
|
9184
|
8
|
7N4W
|
|||
|
Helena
|
9184
|
7
|
7N4W
|
|||
|
Jordan
|
9184
|
7,
8
|
7N4W
|
|||
|
Missing
Link
|
9184
|
7,
18
|
7N4W
|
|||
|
Montana
|
9184
|
8
|
7N4W
|
|||
|
P.Q.C.
|
9184
|
8
|
7N4W
|
|||
|
Ray
|
9184
|
7
|
7N4W
|
|||
|
S.R.D.
|
9184
|
7
|
7N4W
|
|||
|
Last
Chance
|
9193
|
10
|
7N4W
|
|||
|
Babe
|
9325
|
16
|
7N4W
|
|||
|
Soldier
Boy
|
▇▇▇▇
|
▇,
▇▇
|
▇▇▇▇
|
|||
|
▇.▇.
|
▇▇▇▇
|
▇,
▇▇
|
▇▇▇▇
|
|||
|
▇▇▇▇▇
|
▇▇▇▇
|
▇▇
|
▇▇▇▇
|
|||
|
▇▇▇▇▇▇▇
|
9915
|
11,
13, 14
|
7N4W
|
|||
|
▇▇▇▇
Eagle
|
9915
|
11,
12
|
7N4W
|
|||
|
Paris
|
9915
|
12
|
7N4W
|
|||
|
▇▇▇▇▇▇
|
10031
|
16
|
7N4W
|
|||
|
Houghton
|
10032
|
17
,18
|
7N4W
|
|||
|
Wickes
|
10032
|
17,
18
|
7N4W
|
|||
|
Blizzard
No. 2
|
10033
|
18
|
7N4W
|
|||
|
Last
Chance
|
10640
|
9
|
7N4W
|
|||
|
Sure
Thing
|
10640
|
9
|
7N4W
|
|||
|
▇▇▇▇▇▇
▇▇▇▇▇
|
8939
|
17
|
7N4W
|
|||
page
93
|
NAME OF CLAIM
|
U.S. MS NO.
|
Section
|
Township &
Range |
|||
|
Elkador
Extension
|
8939
|
17
|
7N4W
|
|||
|
Elkador
|
2038
|
17,
18
|
7N4W
|
|||
|
▇▇▇▇▇▇
▇▇▇▇▇ Extension
|
8939
|
17,
18
|
7N4W
|
|||
|
▇▇▇▇▇▇▇
Placer
|
4154
|
8,
17
|
7N4W
|
|
B.
|
The
Searchlight patented mining claim, M.S. No. 6640, and the Wasp
patented mining claim, M.S. No. 6634, both of which are covered by
that Exploration and Mining Lease dated March 19, 2004 between
Fremont River Development Corporation and Montana Tunnels Mining,
Inc.
|
UNPATENTED
MINING CLAIMS
The
following unpatented lode mining and millsite claims situate in Sections 10-15,
22-24, and 26-27, Township 7 North, Range 4 West, P.M.M., Jefferson County,
Montana, to-wit:
County
Recording
|
Claim Name
|
Book
|
Page
|
BLM MMC
|
|||
|
GG
41R
|
70
|
296
|
126750
|
|||
|
GG
42R
|
70
|
298
|
126751
|
|||
|
GG
45
|
66
|
28
|
81809
|
|||
|
GG
46
|
66
|
29
|
81810
|
|||
|
GG
47
|
66
|
30
|
81811
|
|||
|
GG
49
|
66
|
32
|
81813
|
|||
|
GG
50
|
66
|
33
|
81814
|
|||
|
GG
52
|
66
|
35
|
81816
|
|||
|
GG
52R
|
70
|
621
|
127830
|
|||
|
GG
53
|
70
|
639
|
81817
|
|||
|
GG
55
|
70
|
635
|
81819
|
|||
|
GG
113
|
66
|
420
|
86605
|
|||
|
AE
1
|
63
|
256
|
28456
|
|||
|
AE
2
|
63
|
258
|
28457
|
|||
|
▇▇▇
▇
|
▇▇
|
▇▇▇
|
▇▇▇▇▇
|
|||
|
▇▇▇
4
|
66
|
415
|
86607
|
|||
|
▇▇▇
▇
|
▇▇
|
▇▇▇
|
▇▇▇▇▇
|
|||
|
▇▇▇
6
|
66
|
417
|
86609
|
|||
|
AER
7
|
66
|
418
|
86610
|
|||
|
▇▇▇
▇
|
▇▇
|
▇▇▇
|
▇▇▇▇▇
|
|||
|
▇▇▇
9
|
66
|
499
|
88742
|
|||
|
F
11R
|
70
|
280
|
126743
|
|||
|
F
15
|
69
|
541
|
86632
|
|||
| 70 | 645 |
page
94
County
Recording
|
Claim Name
|
Book
|
Page
|
BLM MMC
|
|||
|
F
19
|
69
|
852
|
124060
|
|||
|
76
|
49-51
|
|||||
|
76
|
129
|
|||||
|
76
|
131
|
|||||
|
F-16
|
75
|
803
|
200554
|
|||
|
F-17
|
70
|
643
|
121433
|
|||
|
F-18
|
69
|
686
|
121434
|
|||
|
F-22
|
70
|
286
|
126745
|
|||
|
F-23
|
70
|
629
|
127834
|
|||
|
F-24
|
70
|
288
|
126746
|
|||
|
F-25
|
70
|
292
|
126747
|
|||
|
F-26
|
70
|
290
|
126748
|
|||
|
F-27
|
70
|
294
|
126749
|
|||
|
ALTA
FRACTION ▇▇. ▇
|
▇▇
|
▇▇▇
|
▇▇▇▇▇▇
|
|||
|
▇▇▇▇
FRACTION ▇▇. ▇
|
▇▇
|
▇▇▇
|
▇▇▇▇▇▇
|
|||
|
▇▇▇▇
FRACTION ▇▇. ▇
|
▇▇
|
▇▇▇
|
▇▇▇▇▇▇
|
|||
|
GM
36
|
65
|
983
|
81868
|
|||
|
GM
54
|
66
|
903
|
101643
|
|||
|
MF
1
|
68
|
816
|
83464
|
|||
|
70
|
631
|
|||||
|
75
|
800
|
|||||
|
TBX
14
|
69
|
191
|
28455
|
|||
|
Kaki
|
69
|
193
|
28440
|
|||
|
76
|
141
|
|||||
|
76
|
143
|
Owner
or
Claimant:
Montana
Tunnels Mining, Inc.
page
95
Schedule
11
Current
Insurance Policies
APOLLO
GOLD/MONTANA TUNNELS
Insurance
Program
Through
June 30, 2008
|
Description
|
2007-8
|
|||||
|
Type
|
Insurer
|
Policy Number
|
Coverage
|
|||
|
· Auto
|
National
Union Fire Ins Co (AIG
|
CA
▇▇▇-▇▇-▇▇
|
$1
million
|
|||
|
· General
Liability & Emp Benefit
|
National
Union Fire Ins Co (AIG
|
GL
▇▇▇-▇▇-▇▇
|
$2
million/$1K
|
|||
|
· Umbrella
|
National
Union Fire Ins Co (AIG)
|
BE7250685
|
$20
million/$10K
|
|||
|
· Workers
Comp (Corporate)
|
New
Hampshire Insurance Company
|
WC
▇▇▇-▇▇-▇▇
|
Statutory
|
|||
|
· Foreign
Pkg (WC)
|
AIG
|
WR10006025
|
Statutory
|
|||
|
· Canadian
Autos
|
Chubb
Ins Companies of Canada
|
37112596
|
$2
million/$1K
|
|||
|
· Canadian
General Liability
|
American
Home Assurance Co
|
RMGALA5488551
|
$2
million/$1K
|
|||
|
· Property
& Boiler,BI after 30 days
|
Zurich
|
IM4553928-02
|
$61
million/$500K (was $55 mil.)
|
|||
|
· Stock
throughput Program (Transit)
|
Lloyds
of ▇▇▇▇▇▇
|
▇▇▇▇▇▇▇
|
$2.5
million/$5K
|
|||
|
· Directors
and Officers (D&O)
|
National
Union Fire Ins Co (AIG)
|
▇▇▇-▇▇-▇▇
|
$20
million/$100K/$150K (was $5+$5)
|
|||
|
· Excess
D&O over $5 million
|
National
Union Fire Ins Co (AIG)
|
N/A
|
$5
million
|
|||
|
· Other
Insurance
|
National
Union Fire Ins Co (AIG)
|
647-9816
|
$3
million
|
|||
|
· Commercial
Crime
|
Hartford
Fire Insurance Co
|
00
FA 0233570-07
|
$3
million/$50K
|
|||
|
· Fiduciary
Liability
|
Federal
Insurance Co (Chubb)
|
6801-6727
|
$1
million/$25K
|
|||
page
96
Schedule
12
Excluded
Claims
|
1
|
GG
41R
|
|
|
2
|
GG
42R
|
|
|
3
|
GG
49
|
|
|
4
|
GG
50
|
|
|
5
|
GG52
|
|
|
6
|
GG
52R
|
|
|
7
|
GG
53
|
|
|
8
|
GG
55
|
|
|
9
|
AER
8
|
|
|
10
|
AER
9
|
|
|
11
|
F-16
|
|
|
12
|
F-17
|
|
|
13
|
F-18
|
|
|
14
|
F-22
|
|
|
15
|
F-23
|
|
|
16
|
ALTA
FRACTION ▇▇. ▇
|
|
|
▇▇
|
▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇. ▇
|
|
|
▇▇
|
▇▇▇▇
FRACTION NO. 7
|
|
|
GM
36
|
||
|
20
|
GM
54
|
page
97
|
Signing
page
Executed
as an agreement
|
Borrower
|
||
|
Signed
for
Montana
Tunnels Mining, Inc.
By
its authorised signatory
|
||
|
By:
|
||
|
Authorised
Signatory
|
||
|
print
name
|
||
|
title
|
||
|
Guarantor
|
||
|
Signed
for
Apollo
Gold Corporation
By
its authorised signatory
|
||
|
By:
|
||
|
Authorised
Signatory
|
||
|
print
name
|
||
|
title
|
||
|
Guarantor
|
||
|
Signed
for
Apollo
Gold Inc.
By
its authorised signatory
|
||
|
By:
|
||
|
Authorised
Signatory
|
||
|
print
name
|
||
|
title
|
||
|
|
Signing
page
|
|
Agent
|
||
|
Signed
for
RMB
Resources Inc.
By
its authorised officer
|
||
|
By:
|
||
|
Authorised
Officer
|
||
|
print
name
|
||
|
title
|
||
| |
|
Financier
|
||
|
Signed
for
RMB
Australia Holdings Limited
By
|
||
|
By:
|
||
|
Director
|
||
|
print
name
|
||
|
By:
|
||
|
Director
/ Secretary
|
||
|
print
name
|
||
|
title
|
||