NOTES REPURCHASE AGREEMENT
This
NOTES REPURCHASE AGREEMENT (this “Agreement”)
dated September 22, 2009 is made by and between China ▇▇▇▇ ▇▇▇▇ Mining &
Resources, Inc., a Nevada corporation with limited liability having its
registered office at Zeyang Building, No. 166 Fushi Road, Shijingshan District,
Beijing China, whose shares of commons stocks of are listed and traded on
NYSE-AMEX (the “Company”)
and Mountview Path Limited, a corporation incorporated under the laws of the
British Virgin Islands and having its registered office at P.O. Box 957,
Offshore Incorporations Centre, Road Town, Tortola, British Virgin Islands (the
“Seller”).
RECITALS:
WHEREAS, the Company has
issued to Citadel Equity Fund Ltd. (“Citadel”),
and Citadel has purchased from the Company, the Company’s 6.75% Senior
Convertible Notes due 2012 of US$28,000,000 principal amount (the “Notes”)
pursuant to that certain Notes Purchase Agreement dated December 21, 2006 by and
between the Company and Citadel (the “Notes Purchase
Agreement”).
WHEREAS, in connection with
such transaction, an Indenture dated December 27, 2006, as amended and
supplemented by the First Supplemental Indenture dated May 17, 2007 and the
Second Supplemental Indenture dated September 28, 2007, (the “Indenture”)
was entered into by and between the Company and The Bank of New York (the “Trustee”)
and a Share Pledge Agreement dated December 27, 2006 (the “Share Pledge
Agreement”) was entered into by and among ▇▇. ▇▇▇▇ ▇▇▇▇ ▇▇ and ▇▇. ▇▇▇
▇▇▇▇ ▇▇ (each a “Pledgor”
and together the “Pledgors”),
The Bank of New York, as collateral agent and Citadel. Capitalized terms that
are not otherwise defined in this Agreement shall have the meanings ascribed to
them in the Indenture or other relevant Transaction Documents (as that term is
defined in the Notes Purchase Agreement), as applicable.
WHEREAS, Citadel and China
Mining Resources Group Limited, being the holding company of Best Tone Holdings
Limited, entered into that certain Amended and Restated Trade Confirmation dated
April 8, 2009, pursuant to which Citadel agreed to sell, transfer and deliver to
China Mining Resources Group Limited all of Citadel’s rights and interest in the
Notes and all rights and interest of Citadel under the Transaction Documents (as
that term is defined in the Notes Purchase Agreement).
WHEREAS, Citadel and Best Tone
Holdings Limited entered into that certain Assignment and Assumption Agreement
dated as of April 8, 2009, pursuant to which Citadel agreed to sell, assign,
transfer and deliver to Best Tone Holdings Limited and Best Tone Holdings
Limited thereby agreed to purchase and assume from Citadel all of the legal and
beneficial right, title and interest of Citadel in the Notes and under the
Transaction Documents (as that term is defined in Notes Purchase
Agreement).
WHEREAS, Best Tone Holdings
Limited and the Seller entered into that certain Trade Confirmation dated August
19, 2009, pursuant to which Best Tone Holdings Limited agreed to sell, transfer
and deliver to the Seller all of Best Tone Holdings Limited’s rights and
interest in the Notes and all rights and interest of Best Tone Holdings Limited
under the Transaction Documents (as that term is defined in the Notes Purchase
Agreement).
WHEREAS, Best Tone Holdings
Limited and the Seller entered into certain Assignment and Assumption Agreement
dated August 19, 2009, pursuant to which Best Tone Holdings Limited agreed
to sell, assign, transfer and deliver to the Seller and the Seller thereby
agreed to purchase and assume from Best Tone Holdings Limited all of the legal
and beneficial right, title and interest of Best Tone Holdings Limited in the
Notes and under the Transaction Documents.
WHEREAS, the Company now
wishes to repurchase from the Seller, and the Seller wishes to sell to the
Company, the Notes in an aggregate principal amount of US$28,000,000 (the “Repurchased
Notes”) upon the terms and conditions set forth in this
Agreement.
NOW THEREFORE, in
consideration of the foregoing and the mutual promises, covenants and agreements
of the parties contained herein, the parties hereto agree as
follows:
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1.
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NOTES
REPURCHASE; PAYMENT; CANCELLATION
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1.1.
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Repurchase
and Sale of the Repurchased Notes. At the closing (the “Closing”),
the Company shall repurchase the Repurchased Notes from the Seller and the
Seller shall sell to the Company the Repurchased Notes for an aggregate
purchase price of US$28 million, (the “Repurchase
Price”) which shall be satisfied by (i) payment in cash of US$8
million by the Company to the Seller at Closing and (ii) by the Company
allotting and issuing 5 million shares of the Company’s common stock at an
issued price of US$4 per share to the Seller at Closing. Notwithstanding
any terms of this Agreement, the Seller shall be entitled to all rights
and privileges in respect of the Repurchased Notes as a noteholder up to
and including the Closing Date (as defined below), except that the right
to receive any Interest and Additional Interest payable on the Repurchased
Notes in respect of any Record Date prior to the Closing Date is waived.
For the avoidance of doubt, except as provided in the preceding sentence,
the Seller shall not be entitled to any accrued and unpaid Interest on the
Repurchased Notes.
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1.2.
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Closing.
The Closing shall occur at the Beijing office of Cadwalader, ▇▇▇▇▇▇▇▇▇▇
& ▇▇▇▇ LLP at ▇▇▇▇ ▇▇▇▇▇ Central ▇▇▇▇▇ ▇▇▇▇▇ ▇, ▇▇. ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇, or at such other place as the Company and the Seller shall
mutually agree, on November 30, 2009 or such other date as the
parties mutually agree (the “Closing
Date”).
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1.3.
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Cancellation
of Notes. On the Closing Date, the Seller shall, against the payment of
the Repurchase Price by the Company, surrender to the Trustee the
respective Repurchased Notes for the prompt cancellation of such
Repurchased Notes by the Trustee pursuant to Section 2.11 of the
Indenture. The Company and the Seller hereby agree to take all actions
necessary and proper in order for the Trustee to promptly cancel such
Repurchased Notes pursuant to this Agreement and the terms of the
Indenture. All costs and expenses for cancellation of the
Repurchased Notes shall be borne by the
Company.
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2.
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WAIVER
AND FORBEARANCE
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2.1.
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Waiver.
The Seller hereby waives, pursuant to Section 6.04 of the Indenture, all
Defaults, Events of Defaults and their consequences, if any, on the part
of the Company for failure to duly observe and perform covenants set forth
in the Indenture (collectively, the “Waived
Matters”), provided, that this
waiver shall terminate, and be deemed to have never taken effect, if the
Company defaults in its obligations to complete the repurchase of the
Repurchased Notes at the Closing.
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2.2.
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Forbearance.
The Seller hereby agrees to forbear, and directs the Trustee to forbear,
from taking or exercising any Enforcement Action (as defined below) in
connection with the Waived Matters (the “Forbearance”),
provided that
this Section 2.2 shall terminate if the waiver is terminated as provided
in 2.1 above. “Enforcement Action” means any Default-related right, remedy
or other action available to the Seller or the Trustee or aiding and
abetting, assisting, cooperating with or otherwise supporting any other
Person in taking or exercising any Default-related right, remedy or other
action available to such Person.
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3.
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FURTHER
ACTIONS
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3.3.
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The
Pledge Agreement and the obligations, rights and restrictions thereunder
and in connection therewith on all of the parties thereto are cancelled as
of the Closing Date. The Company and the Seller hereby agree to
take all actions necessary and proper in order for the Bank of New York,
as collateral agent, to promptly release the security interest created
thereunder and to deliver the Pledged Stock, as defined in the Pledge
Agreement, to the relevant Pledgor. All costs and expenses for the release
the security interest created thereunder and to deliver the Pledged Stock
shall be borne by the Company.
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4.
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SELLER’S
REPRESENTATIONS AND WARRANTIES
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4.1.
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Seller’s
Authority. The Seller is the beneficial owner of all the Repurchased
Notes, and has all requisite right, power and authority to enter into this
Agreement and to consummate the transactions contemplated hereby. This
Agreement has been duly executed and delivered by the Seller and
constitutes the legal, valid and binding obligation of the Seller,
enforceable against the Seller in accordance with its
terms.
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4.2.
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Title
to the Repurchased Notes. The Seller represents and warrants to, and
agrees with, the Company that it is and as of the Closing Date will be the
beneficial owner of the Repurchased Notes, free and clear of any
encumbrances, including, without limitation, any charge, claim, condition,
equitable interest, lien, option, pledge, security interest, right of
first refusal, or restriction of any kind, including any restriction on
use, voting, transfer, receipt of income, or exercise of any other
attribute of ownership.
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4.3.
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Disclosure
of Information. The Seller has received all the information it considers
necessary or appropriate to determine whether to sell the Repurchased
Notes to the Company pursuant to this Agreement. The Seller acknowledges
(i) the Company has not made any representation or warranty, express or
implied, except as set forth herein, regarding any aspect of the sale and
purchase of the Repurchased Notes, the operation or financial condition of
the Company or the value of the Repurchased Notes, (ii) that except the
representations and warranties given by the Company as provided in Section
5, it is not relying upon the Company in making its decision to sell the
Repurchased Notes to the Company pursuant to this Agreement and (iii) that
the Company is relying upon the truth of the representations and
warranties in this Section 4 in connection with the purchase of the
Repurchased Notes hereunder.
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5.
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COMPANY’S
REPRESENTATIONS AND WARRANTIES
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5.1.
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Company’s
Authority. The Company has all requisite corporate right, power and
authority to enter into this Agreement and to consummate the transactions
contemplated hereby. This Agreement has been duly executed and delivered
by the Company and constitutes the legal, valid and binding obligation of
the Company, enforceable against the Company in accordance with its
terms.
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5.2.
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No
insolvency. The Company has taken no action, and no steps have been taken
or legal proceedings started or threatened against it for an
administration, winding-up, examinership, interim or bankruptcy order to
be made against it or for its dissolution or reorganization or for the
appointment of a receiver, administrative receiver, examiner, supervisor,
trustee or similar officer over, or for the taking into possession or
enforcement of security by an encumbrancer, mortgagee or chargee in
respect of, all or any part of its assets, undertaking or revenues. The
Company is not insolvent and is able to pay its debts as and when they
become due.
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5.3.
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Disclosure
of Information. The Company has received all the information it considers
necessary or appropriate to determine whether to purchase the Repurchased
Notes from the Seller pursuant to this Agreement. The Company acknowledges
(i) the Seller has not made any representation or warranty, express or
implied, except as set forth herein, regarding any aspect of the sale and
purchase of the Repurchased Notes, the operation or financial condition of
the Company or the value of the Repurchased Notes, (ii) that except the
representations and warranties given by the Seller as provided in Section
4, it is not relying upon the Seller in making its decision to purchase
the Repurchased Notes from the Seller pursuant to this Agreement and (iii)
that the Seller is relying upon the truth of the representations and
warranties in this Section 5 in connection with the purchase of the
Repurchased Notes hereunder.
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5.4.
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The
issued shares of the common stock of the Company are listed and traded on
NYSE-AMEX.
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6.
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CONDITIONS
PRECEDENT TO THE COMPANY’S OBLIGATION TO
CLOSE
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6.1.
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The
Company’s obligation to repurchase the Repurchased Notes and to take the
other actions required to be taken by the Company is subject to the
satisfaction, or waiver, of the following
conditions:
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(a)
Accuracy of Representations and Warranties. The Seller’s representations and
warranties in Section 4 shall be accurate as of the date of this Agreement, and
shall be accurate as of the Closing Date as if made on the date
thereof.
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(b)
Performance. The Seller shall have duly performed and complied with all of the
obligations that the Seller is required to perform or to comply with pursuant to
this Agreement on or prior to the Closing.
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7.
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CONDITIONS
PRECEDENT TO THE SELLER’S OBLIGATION TO
CLOSE
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7.1.
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The
Seller’s obligation to sell the Repurchased Notes and to take the other
actions required to be taken by the Seller is subject to the satisfaction,
or waiver, of the following
conditions:
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(a)
Accuracy of Representations and Warranties. The Company’s representations and
warranties in Section 5 shall be accurate as of the date of this Agreement, and
shall be accurate as of the Closing Date as if made on the date
thereof.
(b)
Performance. The Company shall have duly performed and complied with all of the
obligations that the Company is required to perform or to comply with pursuant
to this Agreement on or prior to the Closing Date.
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8.
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MUTUAL
RELEASE AND COVENANT NOT TO ▇▇▇
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8.1.
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Release
by the Company. In consideration of the matters referenced in this
Agreement, the Company on behalf of itself and its respective
subsidiaries, affiliates, agents, officers, owners, directors, employees,
counsel, insurers, successors, assigns, heirs, executors or administrators
(collectively, the “Related
Parties”), hereby forever release, discharge, cancel, waive, and
acquit the Seller and its Related Parties of and from any and all rights,
claims, demands, causes of action, obligations, damages, penalties, fees,
costs, expenses, and liabilities of any nature whatsoever, whether in law
or equity (collectively, the “Claims”),
which the Company has, had or may hereafter have against the Seller or any
of its Related Parties arising out of, or by reason of, any cause or
matter, existing as of the date of this Agreement, whether known to the
Company at the time of execution of this agreement or not, provided,
however, that this release shall not apply to any breaches by the Seller
or its Related Parties of this
Agreement.
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8.2.
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Release
by the Seller. In consideration of the matters referenced in
this Agreement, the Seller on behalf of itself and its Related Parties,
hereby forever release, discharge, cancel, waive, and acquit the Company
and its Related Parties of and from any and all Claims, which the Seller
has, had or may hereafter have against the Company or any of its Related
Parties arising out of, or by reason of, any cause or matter, existing as
of the date of this Agreement, whether known to the Seller at the time of
execution of this agreement or not, provided, however, that this release
shall not apply to any breaches by the Company or its Related Parties of
this Agreement.
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8.3.
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Covenant
Not to ▇▇▇. The Company and the Seller further covenant and
agree not to institute, nor cause to be instituted, nor aid (except as
required by law) any legal proceeding of any nature whatsoever, except
that a party hereto may file a legal proceeding against the other solely
to enforce the terms of this
Agreement.
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9.
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MISCELLANEOUS
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9.1.
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Governing
Law. This Agreement shall be governed by and construed exclusively in
according with the laws of the State of New York without giving effect to
any choice of law rule that would cause the application of the laws of any
jurisdiction other than the laws of the State of New York to the rights
and duties of the parties
hereunder.
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9.2.
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Reliance. The
Company and the Seller represent and warrant that: (a) each has relied on
its own judgment regarding the consideration for and language of this
Agreement; (b) each has been given a reasonable period of time to consider
this Agreement, has been advised to consult with independent counsel
before signing this Agreement, and has consulted with independent counsel
with respect hereto; (c) no party has in any way coerced or unduly
influenced any other party to execute this Agreement; (d) no party has
relied upon any advice or any representation of any other party’s counsel;
and (e) this Agreement is written in a manner that is understandable to
all of the parties.
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9.3.
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Entire
Agreement. This
Agreement constitutes the entire agreement between the parties hereto
relating to the subject matter hereof and supersedes all prior agreements
or understandings, both oral and written, between the parties hereto
relating to the subject matter
hereof.
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9.4.
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Binding
Effect; Benefit.
This Agreement shall inure to the benefit of and be binding upon
the parties and their respective heirs, successors, legal representatives
and permitted assigns. Nothing in this Agreement, expressed or implied, is
intended to confer on any person other than the parties, and their
respective heirs, successors, legal representatives and permitted assigns,
any rights, remedies, obligations or liabilities under or by reason of
this Agreement.
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9.5.
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Assignment. No party may assign,
delegate or otherwise transfer any of its rights or obligations under this
Agreement without the written consent of the other
party.
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9.6.
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Amendment;
Waiver.
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(a) This
Agreement may not be amended, modified or supplemented except by a written
instrument executed by each of the parties.
(b) No
waiver of any provision of this Agreement shall be effective unless set forth in
a written instrument signed by the party waiving such provision. No failure or
delay by a party in exercising any right, power or privilege hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of the
same preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. Without limiting the foregoing, no waiver by a party
of any breach by any other party of any provision hereof shall be deemed to be a
waiver of any subsequent breach of that or any other provision hereof. The
rights and remedies herein provided shall be cumulative and not exclusive of any
rights or remedies provided by law.
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9.7.
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Notices. Each notice, demand or
other communication under this Agreement shall be in writing and delivered
or sent to the relevant party at its address or fax number set out below
(or such other address or fax number as the addressee has by five (5)
days’ prior written notice specified to the other party). Any notice,
demand or other communication so addressed to the relevant party shall be
deemed to have been delivered (a) if delivered in person or by messenger,
when proof of delivery is obtained by the delivering party; (b) if sent by
post within the same country, on the third (3rd) day following posting,
and if sent by post to another country, on the fifth (5th) day following
posting, and (c) if given or made by fax, upon dispatch and the receipt of
a transmission report confirming dispatch. The initial address and
facsimile for the parties for the purposes of this Agreement
are:
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(a) if to
the Company, to:
China
▇▇▇▇ ▇▇▇▇ Mining & Resources, Inc.
▇▇. ▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇,
People’▇
▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
Fax: ▇▇▇
▇▇ ▇▇▇▇ ▇▇▇▇
Attention:
Chief Financial Officer
(b) if to
the Seller, to:
Mountview
Path Limited
908 China
Merchants Tower,
▇▇▇-▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇
▇▇▇, ▇▇▇▇ ▇▇▇▇
Fax: ▇▇▇▇
▇▇▇▇▇▇▇▇
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9.8.
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Counterparts. This Agreement may be
signed in any number of counterparts including counterparts transmitted by
facsimile, each of which shall be deemed an original, with the same effect
as if the signatures thereto and hereto were upon the same
instrument.
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9.9.
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Severability. If any provision
contained in this Agreement shall for any reason be determined to be
partially or wholly invalid, illegal or unenforceable by any court of
competent jurisdiction, such provision shall be of no force and effect to
the extent so determined, but the invalidity, illegality or
unenforceability of such provision shall have no effect upon and shall not
impair the validity, legality or enforceability of any other provision of
this Agreement.
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9.10.
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Further
Assurances. Each
party shall at its own costs and expenses give such further assurance,
provide such further information, take such further actions and execute
and deliver such further documents and instruments as are, in each case,
within its power to give, provide and take so as to give full effect to
the provisions of this Agreement.
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9.11.
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Each
party hereto shall bear its own costs and expenses incurred in connection
with the negotiation, preparation and execution of this
Agreement.
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[Signature
page follows on the next page]
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IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year first
above written.
| CHINA ▇▇▇▇ ▇▇▇▇ MINING & RESOURCES, INC. | |||
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By:
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/s/ ▇▇▇▇▇▇▇▇ ▇▇ | |
| Name: ▇▇▇▇▇▇▇▇ ▇▇ | |||
| Title: Chief Executive Officer | |||
| MOUNTVIEW PATH LIMITED | |||
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By:
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/s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ | |
| Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ | |||
| Title: Director | |||
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