UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________
SCHEDULE 13D
Under the Securities Exchange Act of 1934
Solv-Ex Corporation
(Name of Issuer)
Common Stock, $.01 par value per share
(Title of Class of Securities)
<PAGE>
<TABLE>
<CAPTION> 83438010
(CUSIP Number)
<S> <C>
Robert Lynch, Esq. with copies to:
Deutsche Bank Maureen Brundage, Esq.
North American Holding Corp. White & Case
31 West 52nd Street 1155 Avenue of the Americas
New York, NY 10019 New York, NY 10036
(212) 474-8600 (212) 819-8314
</TABLE>
(Name, Address and Telephone Number of Person Authorized to Receive Notices
and Communications)
September 17, 1996
____________________________________________________________
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the following
box .
____________
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE 13D
<S> <C>
CUSIP No. 83438010 Page 3 of ___ Pages
</TABLE>
<PAGE>
<TABLE>
<S> <C>
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Deutsche Bank AG
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a)
(b)
3 SEC USE ONLY
4 SOURCE OF FUNDS
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Federal Republic of Germany
NUMBER OF SHARES 7 SOLE VOTING POWER
BENEFICIALLY OWNED BY EACH 2,963,214
REPORTING PERSON WITH
8 SHARED VOTING POWER
0
9 SOLE DISPOSITIVE POWER
2,963,214
10 SHARED DISPOSITIVE POWER
0
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,963,214
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES (x)
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
12.4%
14 TYPE OF REPORTING PERSON
HC, BK, CO
</TABLE>
<PAGE>
ITEM 1. SECURITY AND ISSUER
This statement on Schedule 13D relates to the common stock, $.01 par
value per share (the "Common Stock"), of Solv-Ex Corporation, a New Mexico
corporation ("Solv-Ex"), the principal executive offices of which are located
at 500 Marquette N.W., Suite 300, Albuquerque, New Mexico 87102.
ITEM 2. IDENTITY AND BACKGROUND
This statement on Schedule 13D is being filed by Deutsche Bank AG
("DBAG"). The principal business of DBAG is the provision of financial and
related services. DBAG is the largest banking institution in the Federal
Republic of Germany and is the parent company of a group consisting of banks,
capital market and fund management companies, mortgage banks and property
finance companies, installment financing and leasing companies, insurance
companies, research and consultancy companies and other companies. It is
organized under the laws of the Federal Republic of Germany, and the address
of its principal place of business is Taunusanlage 12, D-60325, Frankfurt am
Main, Germany.
The attached Schedule A is a list of the executive officers and
directors of DBAG which contains the following information with respect to
each such person: (i) name; (ii) business address; (iii) present principal
occupation or employment and the name, principal business and address of any
corporation or other organization in which such employment is conducted; and
(iv) place of citizenship.
During the last five years, neither DBAG nor, to the best knowledge
of DBAG, any of the persons named in Schedule A hereto has been convicted in a
criminal proceeding (excluding traffic violations or similar misdemeanors) or
has been a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction as a result of which such person was or is subject to a
judgment, decree or final order enjoining future violations of, or prohibiting
or mandating activities subject to, federal or state securities laws or
finding any violation with respect to such laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
ALULUX AND SANDVEST. DBAG is the beneficial owner of 1,157,114
shares of Common Stock of Solv-Ex held by Alulux Mining S.A. ("Alulux") and
Sandvest Petroleum S.A. ("Sandvest"), both Luxembourg corporations. Of such
amount, Alulux holds 605,427 shares, and Sandvest holds 551,687 shares.
It appears that Peter W. Young ("Young"), a former employee of an
affiliate of DBAG, purportedly acting on behalf of "Morgan Grenfell" (with no
entity being specified), entered into undated agreements ("W&W Agreements"),
one relating to Alulux and one relating to Sandvest, with two Zurich based
Swiss lawyers, Marco Wolf ("Wolf") and Juerg Wyler ("Wyler"). Each W&W
Agreement provides that Wolf and Wyler would incorporate the respective
company, join its board of directors and represent "Morgan Grenfell" at
shareholders' meetings, all subject to the instructions of "Morgan Grenfell".
Each W&W Agreement is terminable by either party at any time.
Alulux acquired an aggregate of 605,427 shares of Common Stock of
Solv-Ex between March 13 and March 22, 1996 for an aggregate purchase price of
$18,077,779. Sandvest acquired an aggregate of 908,140 shares of Common Stock
of Solv-Ex between March 12 and March 22, 1996 for an aggregate purchase price
of $27,115,987. DBAG believes but has been unable to confirm that all such
shares were purchased in connection with offerings by Solv-Ex. Sandvest
subsequently transferred 356,453 shares of Common Stock of Solv-Ex to Russ Oil
& Technology S.A., as described in response to Item 4.
From no later than the dates of such purchases to August 30, 1996,
the shareholders of Alulux and Sandvest included the Morgan Grenfell European
Capital Growth Fund ("ECGF") and the Morgan Grenfell European Growth Trust
<PAGE>
("EGT" and, along with the ECGF, the "Funds") (two funds with respect to which
Young had investment management responsibilities), Morgan Grenfell Europa Fund
("EF") and certain other managed funds and accounts over which affiliates of
DBAG exercised investment control. ECGF, EGT, EF and such other managed funds
and accounts are referred to collectively as the "DBAG Funds and Accounts."
Since early 1996, Alulux has owned over 95% of the capital stock of Sandvest,
and Sandvest has owned approximately 94% of the capital stock of Alulux.
Substantially all the shares of capital stock of Alulux not owned by Sandvest,
and substantially all the capital stock of Sandvest not owned by Alulux, were
owned by the DBAG Funds and Accounts. Prior to September 1996, the board of
directors of Alulux and Sandvest each consisted of the same four persons
(which included Wolf and Wyler). Such persons were not affiliated with or
controlled by DBAG (unless DBAG is taken to have control over such persons
pursuant to the W&W Agreements).
DBAG believes that Alulux and Sandvest purchased the shares of
Common Stock of Solv-Ex referred to above using the funds obtained by them
through the issuance of their capital stock to the DBAG Funds and Accounts.
The foregoing information concerning activities and transactions of
Alulux and Sandvest is based upon the information currently available to DBAG.
On August 30, 1996, DBAG acquired all of the shares of capital stock
of Alulux and Sandvest held by the ECGF, the EGT and the EF. The purchase
prices paid by DBAG to the ECGF, the EGT and the EF for their respective
shares of Alulux were DM8,921,038, Pound/Sterling 8,102,953 and Pound/Sterling
2,552,111, respectively. The purchase prices paid to the ECGF, the EGT and
the EF for their shares of Sandvest were DM7,316,496, Pound/Sterling 6,648,316
and Pound/Sterling 1,453,604, respectively. Subsequently DBAG acquired all of
the shares of Alulux and Sandvest held by the other DBAG Funds and Accounts
for an aggregate purchase price of DM3,643,144.
On September 4, 1996, DBAG as a shareholder of Alulux convened an
extraordinary general meeting of the shareholders of Alulux. DBAG was the
only shareholder present at this meeting. On the same date, DBAG as a
shareholder of Sandvest also convened an extraordinary general meeting of
shareholders of Sandvest at which DBAG was the only shareholder present. At
each of these meetings DBAG voted in favor of resolutions removing all of the
directors of Alulux and Sandvest and replacing them with directors who are
employees of DBAG affiliates. One incumbent director of Alulux and Sandvest
did not challenge the validity of his removal by the extraordinary general
meeting. Three of the four incumbent directors did not accept the validity of
their removal from the boards of Alulux and Sandvest. Two of the directors,
Wolf and Wyler, subsequently resigned on September 17, 1996, and the other
(who was the custodian of the books and records of the two companies) resigned
on September 18, 1996. In connection with such resignations, Wolf and Wyler
agreed to give DBAG all of the books, records and assets, and the other
director agreed to give DBAG all of the books and records, in each case, in
such director's possession and at DBAG's direction and request of Alulux,
Sandvest and certain other companies (including PheMex Establishment, Silva
Investments Limited and Russ Oil & Technology S.A. referred to below). As a
result, DBAG and its affiliates obtained full access to the books and records
of Alulux and Sandvest on September 18, 1996.
Based upon the facts summarized above, DBAG believes that it became
the beneficial owner (within the meaning of Rule 13d-3 under the Securities
Exchange Act of 1934, as amended (the "Exchange Act")) of the shares of Common
Stock of Solv-Ex held by Alulux and Sandvest on September 18, 1996.
PHEMEX. DBAG may be deemed to be the beneficial owner (within the
meaning of Rule 13d-3 under the Exchange Act) of 1,016,000 shares of Common
Stock of Solv-Ex which are reserved for immediate issuance upon the exercise
by PheMex Establishment, a Liechtenstein legal entity ("PheMex"), of its
rights under a convertible loan agreement between Solv-Ex and PheMex entered
into on or about April 16, 1996 (the "PheMex Loan Agreement").
<PAGE>
Due to the uncertainty surrounding PheMex, DBAG disclaims beneficial
ownership on the date hereof, for purposes of Sections 13(d) and 13(g) of the
Exchange Act, of any shares of Common Stock of Solv-Ex beneficially owned by
PheMex due to its rights under the PheMex Loan Agreement. For purposes other
than Section 13(d) and 13(g) of the Exchange Act, this filing should not be
construed as an admission or denial of DBAG's ownership of, control over or
connection with PheMex or any securities held by PheMex.
Based upon the information currently available to DBAG, it appears
that PheMex was an existing shell legal entity used by Young for the purpose
of making the loan to Solv-Ex under the PheMex Loan Agreement. Young,
purportedly acting on behalf of "Morgan Grenfell" (with no entity being
specified), entered into an undated agreement with Wolf and Wyler which
provides that Wolf and Wyler would incorporate PheMex, appoint its board of
directors and represent "Morgan Grenfell" at shareholders' meetings, all
subject to the instructions of "Morgan Grenfell". The agreement is terminable
by either party at any time. DBAG believes that the Board of Directors of
PheMex originally consisted of two individuals who are not affiliates of DBAG;
such individuals resigned as directors on September 10, 1996, and, therefore,
there currently are no directors of PheMex. DBAG has not been able to
establish who is the beneficial owner of the Zessionsurkunde of PheMex, which
is a certificate that, under Liechtenstein law, entitles its owner to direct
all activity of the subject company. However, DBAG has been advised that,
because the Zessionsurkunde is held in the custody of Wolf and Wyler and
because of the agreement with Wolf and Wyler referred to above, it may be
considered to control PheMex. As a result of the foregoing, DBAG believes
that, as of September 17, 1996 (i.e., the date on which Wolf and Wyler began
cooperating with DBAG by providing DBAG with access at DBAG's direction and
request to the books, records and assets of PheMex, Silva Investments Limited
and certain other companies), it may be deemed to be the beneficial owner
(within the meaning of Rule 13d-3 under the Exchange Act) of the shares of
Common Stock of Solv-Ex issuable upon conversion of the loan made under the
PheMex Loan Agreement.
Pursuant to the PheMex Loan Agreement, PheMex made a $33,000,000
loan to Solv-Ex (the "PheMex Loan"). The PheMex Loan bears interest at a rate
of 12% per annum and is payable at maturity on April 15, 1999. The PheMex
Loan is secured by 1,016,000 shares of Common Stock of Solv-Ex which Solv-Ex
has agreed to issue upon the occurrence of a default under the PheMex Loan
Agreement. The principal amount of the PheMex Loan is convertible at any time
at the option of PheMex prior to termination of the loan into shares of Common
Stock of Solv-Ex at a conversion price of $32.50 per share (i.e., into
1,016,000 shares of Common Stock of Solv-Ex).
PheMex obtained the funds it used to lend to Solv-Ex from Waferprod
Holding S.A., a Luxembourg company ("Waferprod") which is now controlled by
DBAG, pursuant to a financing loan facility agreement (the "Waferprod Loan
Agreement") entered into on or about April 1996 under which Waferprod lent to
PheMex $33,000,000 (the "Waferprod Loan"). The Waferprod Loan Agreement
provides that interest payments made on the Waferprod Loan will be such
amounts as reflect dividends paid by Solv-Ex to its shareholders. Although
the repayment provisions are ambiguous, the agreement appears to provide that
the Waferprod Loan must be repaid immediately after PheMex has sold its shares
of Common Stock of Solv-Ex. The amount to be repaid thereunder will be equal
to the average listed price on the last five banking days of the shares of
Common Stock of Solv-Ex prior to the repayment date multiplied by 1,015,385
(which is described as the result of dividing the amount of the Waferprod Loan
by the $32.50 conversion price under the PheMex Loan Agreement). It further
appears that in lieu of making such repayment, PheMex may deliver to Waferprod
1,015,385 shares of Common Stock of Solv-Ex.
Waferprod in turn obtained the funds it used to lend to PheMex under
the Waferprod Loan Agreement from Sandvest and Alulux pursuant to financing
loan facility agreements (the "S&A Loan Agreements") dated April 30, 1996.
Under the S&A Loan Agreements, Sandvest and Alulux lent to Waferprod
$14,850,000 and $18,150,000, respectively (the "S&A Loans"). Each of the S&A
<PAGE>
Loan Agreements provides that interest payments on the loans made thereunder
will be paid to Sandvest and Alulux, as the case may be, in the respective
amount reflecting the dividends paid by Solv-Ex to its shareholders. Although
the repayment provisions are ambiguous, each of the S&A Loan Agreements
appears to provide that the loan made thereunder must be repaid immediately
after PheMex has sold its shares of Common Stock of Solv-Ex and 72 hours after
PheMex has repaid the Waferprod Loan and that the amount to be repaid in
respect thereof will be equal to the average listed price on the last five
banking days of the shares of Common Stock of Solv-Ex prior to the repayment
date multiplied by 456,923 in the case of Sandvest or 558,462 in the case of
Alulux (which, in each case, is described as the result of dividing the amount
of each respective loan by the $32.50 conversion price under the PheMex Loan
Agreement). It further appears that in lieu of making such repayments,
Waferprod can deliver to Alulux and Sandvest 456,923 and 558,462 shares,
respectively, of Common Stock of Solv-Ex.
DBAG believes that Alulux and Sandvest funded the loans made
pursuant to the S&A Loan Agreements using the funds obtained by Alulux and
Sandvest through the issuance of their capital stock to the DBAG Funds and
Accounts.
SILVA. DBAG may be deemed to be the beneficial owner (within the
meaning of Rule 13d-3 under the Exchange Act) of 750,000 shares of Common
Stock of Solv-Ex owned by Silva Investment Limited, a corporation organized
under the laws of Cayman Islands ("Silva").
Due to the uncertainty surrounding Silva, DBAG disclaims beneficial
ownership on the date hereof, for purposes of Sections 13(d) and 13(g) of the
Exchange Act, of any shares of Common Stock of Solv-Ex held by Silva. For
purposes other than Sections 13(d) and 13(g) of the Exchange Act, this filing
should not be construed as an admission or denial of DBAG's ownership of,
control over or connection with Silva or any securities held by Silva.
Based upon the information currently available, DBAG has not been
able to establish who owns the outstanding shares of Silva, which are held in
the custody of Wolf and Wyler. It appears that Silva was incorporated at the
direction of Young for the purpose of making investments in shares of Common
Stock of Solv-Ex. Young, purportedly acting on behalf of "Morgan Grenfell"
(with no entity being specified), entered into an undated agreement with Wolf
and Wyler, which provides that Wolf and Wyler would acquire all shares of
Silva on behalf of Morgan Grenfell (C.I.) Ltd., which is stated to be acting
on behalf of Herman van Dalen, join the board of directors of Silva, acquire
1,000,000 shares of Common Stock of Solv-Ex on behalf of Silva, and represent
"Morgan Grenfell" at shareholders' meetings, all subject to the instructions
of "Morgan Grenfell". The agreement is terminable by either party at any
time.
DBAG believes that the Board of Directors of Silva originally
consisted of two individuals who are not affiliates of DBAG; such individuals
resigned as directors on or about September 10, 1996 and, therefore, there
currently are no directors of Silva.
DBAG currently does not know who has or has had the power to vote or
dispose of the shares of Common Stock of Solv-Ex held by Silva. However,
because the shares of Silva are held in the custody of Wolf and Wyler and
because of the agreement with Wolf and Wyler referred to above, DBAG believes
that, as of September 17, 1996 (i.e., the date on which Wolf and Wyler began
cooperating with DBAG by providing DBAG with access at DBAG's direction and
request to the books, records and assets of PheMex, Silva and certain other
companies), it may be deemed to be the beneficial owner (within the meaning of
Rule 13d-3 under the Exchange Act) of the shares of Common Stock of Solv-Ex
held by Silva.
The records of Silva indicate that the 750,000 shares of Common
Stock of Solv-Ex held by Silva were purchased in one transaction on April 8,
1996 at a total purchase price of $12,220,650. DBAG currently does not know
<PAGE>
from whom such shares were purchased. The purchase of such shares of Common
Stock was funded by loans from Alulux and Sandvest. The loan from Alulux
provides that it is prepayable by Silva at any time but provides no right of
Alulux to demand payment and contains no maturity date for the loan. The loan
from Sandvest provides that it is required to be repaid immediately after
Silva has sold its shares of Common Stock of Solv-Ex. Each of the loans
provides that the amount to be repaid thereunder will be equal to the average
listed share price on the last five banking days of the shares of Common Stock
of Solv-Ex prior to the repayment date multiplied by the number of shares of
Common Stock of Solv-Ex acquired with the proceeds of such loan. Neither of
the loans provides for the payment of any interest thereon (although interest
is defined therein as dividends paid by Solv-Ex). DBAG believes that the
source of the funds so loaned by Alulux and Sandvest was the funds obtained by
Alulux and Sandvest through the issuance of their capital stock to the DBAG
Funds and Accounts.
DISCRETIONARY ACCOUNTS. In addition, DBAG beneficially owns 40,100
shares of Common Stock that were purchased from time to time in the open
market by Deutsche Morgan Grenfell, Inc. ("DMG"), an indirect subsidiary of
DBAG, for customer accounts over which DMG has voting and investment
discretion. A total of approximately $600,000 was expended for such purchases
with funds from the relevant customer accounts.
ITEM 4. PURPOSE OF THE TRANSACTION
DBAG purchased shares in Alulux and Sandvest from the DBAG Funds and
Accounts as described in Item 3 because of uncertainty regarding the valuation
of Alulux and Sandvest and with a view to protecting investors' interests.
Such purchases from ECGF, EGT and EF were made after indications from the
Investment Management Regulatory Organisation Limited, a self-regulatory
organization which regulates the investment management business in the United
Kingdom, that it was considering suspending trading in the securities of such
funds. DBAG acquired control of Alulux and Sandvest as described in Item 3 in
order to secure access to their books and records and to exercise control over
their assets and operations.
According to the PheMex Loan Agreement, PheMex made the PheMex Loan
for the purpose of financing the construction of an oil sands production
facility.
According to the respective loan agreements between Silva and Alulux
and Silva and Sandvest, Silva purchased shares of Common Stock of Solv-Ex in
order to build up its portfolio and to increase its participation.
DMG purchased the shares of Common Stock in which it has beneficial
ownership in the ordinary course of its business as a manager of discretionary
investment accounts.
Except as set forth in this Item 4 below, neither DBAG nor, to the
best knowledge of DBAG, any of the persons set forth on Schedule A, has any
current plans or proposals that relate to or would result in (a) the acquisi-
tion by any person of additional securities of Solv-Ex or the disposition of
securities of Solv-Ex; (b) an extraordinary corporate transaction, such as a
merger, reorganization or liquidation of Solv-Ex or any of its subsidiaries;
(c) a sale or transfer of a material amount of assets of Solv-Ex or any of its
subsidiaries; (d) any change in the present board of directors or management
of Solv-Ex, including any plans or proposals to change the number or term of
directors or to fill any existing vacancies on the board; (e) any material
change in the present capitalization or dividend policy of Solv-Ex; (f) any
other material change in Solv-Ex's business or corporate structure; (g)
changes in Solv-Ex's charter, by-laws or instruments corresponding thereto, or
other actions which may impede the acquisition of the control of Solv-Ex by
any person; (h) any of Solv-Ex's securities being delisted from a national
securities exchange or ceasing to be authorized to be quoted in an inter-
dealer quotation system of a registered national securities association; (i)
any of Solv-Ex's equity securities becoming eligible for termination of
<PAGE>
registration pursuant to Section 12(g)(4) of the Securities Exchange Act of
1934, as amended; or (j) any action similar to any of those enumerated above.
DBAG is actively investigating certain companies that may have been
organized or used by Peter W. Young (referred to in Item 3) for the purpose of
acquiring or holding securities, which include or may include additional
shares of Common Stock of Solv-Ex. DBAG, its affiliates, or investment funds
or trusts under the control of its affiliates may have the right to assert and
establish beneficial ownership of such securities, including possibly Common
Stock of Solv-Ex, or may otherwise, by reason of facts disclosed in such
investigation, be deemed to be the beneficial owner of such securities.
In particular, DBAG believes that 1,055,927 shares of Common Stock
of Solv-Ex are held by Russ Oil & Technology S.A., a Luxembourg company ("Russ
Oil"). Such shares include 356,453 shares transferred from Sandvest to Russ
Oil. According to the records of the broker used to effect this transaction,
the trade date for this transfer was April 9, 1996.
Due to the uncertainty surrounding Russ Oil and other companies it
is investigating, including the fact that, in the case of Russ Oil, the shares
of Common Stock of Solv-Ex held by Russ Oil are held in a personal account of
Young as discussed below, DBAG disclaims beneficial ownership on the date
hereof, for purposes of Sections 13(d) and 13(g) of the Exchange Act, of any
shares of Common Stock of Solv-Ex held by Russ Oil or any such other
companies. For purposes other than Sections 13(d) and 13(g) of the Exchange
Act, this filing should not be construed as an admission or denial of DBAG's
ownership of, control over or connection with Russ Oil or any of such other
companies or any securities held by Russ Oil or such other companies.
As indicated in Item 3, Wolf and Wyler agreed on September 17, 1996
to give, at DBAG's direction and request, the books, records and assets of
Russ Oil. Based on such books and records, DBAG currently believes that Russ
Oil was incorporated at the direction of Young in December 1995 and was a
device used by Young to divert money and opportunities of the ECGF and the EGT
for his own benefit. Young, purportedly acting on behalf of "Morgan Grenfell"
(with no entity being specified), entered into an undated agreement with Wolf
and Wyler which provides that Wolf and Wyler would incorporate Russ Oil, join
its board of directors and represent "Morgan Grenfell" at shareholders'
meetings, all subject to the instructions of "Morgan Grenfell". The agreement
is terminable by either party at any time. Wolf and Wyler, as the only
directors of Russ Oil, have indicated that since September 18, 1996 (the date
the third director resigned) they have been unable to act as directors because
at least three directors are required for corporate action. Wolf and Wyler
have stated that they intend to resign as directors of Russ Oil at an
extraordinary general meeting of shareholders that is scheduled to take place
on October 22, 1996. They have also stated that they may seek the appointment
by a Luxembourg court of a provisional administrator of Russ Oil.
A bond, which had substantially been paid for by the Funds, was
exchanged for 25,000 shares of Russ Oil stock, which Young currently holds in
his personal account with Morgan Grenfell (C.I.) Limited, an indirect, wholly-
owned subsidiary of DBAG, acting solely as a nondiscretionary custodian.
The purchase by Russ Oil from Sandvest of the 356,453 shares of
Common Stock was funded by a loan from Sandvest in the amount of $4,488,260
(although the loan amount is ambiguous in the agreement). The loan from
Sandvest provides that it is required to be repaid immediately after Russ Oil
has sold its shares of Common Stock of Solv-Ex. The loan provides that the
amount to be repaid thereunder will be equal to the average listed share price
on the last five banking days of the shares of Common Stock of Solv-Ex prior
to the repayment date multiplied by 356,453 (i.e., the number of shares of
Common Stock of Solv-Ex acquired with the proceeds of such loan). The loan
does not provide for the payment of any interest thereon (although interest is
defined therein as dividends paid by Solv-Ex). DBAG believes that the source
of the funds so loaned by Sandvest was the funds obtained by Sandvest through
<PAGE>
the issuance of its capital stock to the DBAG Funds and Accounts. DBAG
believes that the remaining shares of Common Stock of Solv-Ex held by Russ Oil
were acquired for an aggregate purchase price of $14,440,976 in market or
negotiated transactions.
DBAG does not currently know whether the securities over which it
could properly establish beneficial ownership, or would otherwise be deemed to
be the beneficial owner, include the shares of Common Stock of Solv-Ex
currently held by Russ Oil or any shares of Common Stock of Solv-Ex that may
be held by the other companies that it is investigating nor does it know
(except as stated above) the number of shares of Common Stock of Solv-Ex which
may be held by Russ Oil or any of the other company that it currently is
investigating.
Legal proceedings have been commenced in the Queen's Bench Division
in the High Court of Justice in London, England against Young and Russ Oil by
Morgan Grenfell International Funds Management Limited, an indirect subsidiary
of DBAG, Morgan Grenfell International Funds plc, the investment company a
class of whose shares constitute the ECGF, and the Royal Bank of Scotland Plc
as trustee of the EGT (collectively the "Plaintiffs"), with respect to certain
assets held by Russ Oil or Young but not including the shares of Common Stock
of Solv-Ex. In such proceedings, the Plaintiffs currently do not assert any
claim on or interest in the shares of Common Stock of Solv-Ex held by Russ
Oil. However, the Plaintiffs have expressly reserved the right to claim that
Russ Oil holds assets, including the shares of Common Stock of Solv-Ex, in
trust for the Plaintiffs.
DBAG has initiated discussions with bank regulatory authorities to
develop a plan satisfactory to such authorities to dispose of sufficient
Common Stock or securities convertible into Common Stock of Solv-Ex held by
Alulux and Sandvest, so that the amount of Common Stock of Solv-Ex or such
convertible securities owned by DBAG will be in conformity with banking
regulations limiting such ownership to five per cent of the Common Stock of
Solv-Ex. If DBAG is considered to be interested in Common Stock of Solv-Ex
held by Silva or the Common Stock of Solv-Ex issuable upon the conversion of
the PheMex Loan, this plan may also be required to encompass such Common Stock
held by Silva or the PheMex Loan. DBAG believes that any such plan would
contemplate disposition of shares in market or privately negotiated
transactions over a period that would be of sufficient duration to permit
orderly disposition of such Common Stock.
The Reporting Persons reserve the right from time to time to acquire
other shares of Common Stock, or securities convertible into such shares, or
to dispose of some or all of the shares of Common Stock.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
(a) As a result of its control of Alulux and Sandvest, DBAG is the
beneficial owner of 1,157,114 shares of Common Stock of Solv-Ex, which
constitutes beneficial ownership of 5.1% of the total outstanding shares of
Common Stock, based on 22,886,202 issued and outstanding shares of Common
Stock as of September 4, 1996, as reported in Solv-Ex's Annual Report on Form
10-K for the fiscal year ended June 30, 1996.
As a result of its relationship to PheMex as described in response
to Item 3, DBAG may be deemed to be the beneficial owner of 1,016,000 shares
of Common Stock of Solv-Ex (representing the number of shares issuable upon
conversion of the PheMex Loan), which constitutes beneficial ownership of 4.3%
of the total outstanding shares of Common Stock as of September 4, 1996 (as
adjusted so as to include the shares of Common Stock of Solv-Ex issuable upon
conversion of the PheMex Loan).
As a result of its relationship to Silva as described in response to
Item 3, DBAG may be deemed to be the beneficial owner of 750,000 shares of
<PAGE>
Common Stock of Solv-Ex, which constitutes beneficial ownership of 3.3% of the
total outstanding shares of Common Stock as of September 4, 1996.
As a result of its indirect ownership of DMG, DBAG is the beneficial
owner of 40,100 shares of Common Stock, constituting 0.2% of the outstanding
Common Stock as of September 4, 1996.
As a result of the foregoing, DBAG may be deemed to have an
aggregate beneficial ownership of 2,963,214 shares of Common Stock of Solv-Ex
(including the 1,016,000 shares issuable upon the conversion of the PheMex
Loan), or 12.4% of the outstanding shares of Common Stock as of September 4,
1996 (as adjusted so as to include the shares of Common Stock of Solv-Ex
issuable upon conversion of the PheMex Loan).
For purposes of Sections 13(d) and 13(g) of the Exchange Act, DBAG
disclaims beneficial ownership of the shares of Common Stock of Solv-Ex held
or entitled to be received by Silva and PheMex.
(b) DBAG, through its ownership of Alulux, Sandvest and DMG and its
relationship to PheMex and Silva, may be deemed to have the sole power to vote
or to direct the vote of and to dispose of or to direct the disposition of
2,963,214 shares of Common Stock.
(c) During the past sixty days, neither DBAG nor, to the best
knowledge of DBAG, any of the persons set forth on Schedule A, has effected
any transactions in shares of Common Stock of Solv-Ex except for the following
purchase transactions:
<PAGE>
<TABLE>
<CAPTION>
NUMBER OF
PARTY DATE TYPE SHARES PRICE
<S> <C> <C> <C> <C>
DMG 7/16/96 Market 3,000 $12.667
DMG 8/20/96 Market 700 11.625
DMG 8/20/96 Market 2,000 11.500
</TABLE>
(d) The customers in whose discretionary accounts DMG holds 40,100
shares of Common Stock have the right to receive the dividends from, and the
proceeds of sale of, such shares of Common Stock. Because of DBAG's inability
to determine the ownership of the shares of Silva, it is unclear who has the
right to receive the dividends from, and the proceeds of sale of, the shares
of Common Stock of Solv-Ex held by Silva.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER
Except as otherwise described in response to Item 3 or 4, neither
DBAG nor, to the best knowledge of DBAG, any of the individuals identified in
Schedule A has any contract, arrangement, understanding or relationship with
any person with respect to any securities of Solv-Ex.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
Convertible Loan Agreement, dated on or about July 16, 1996, between
Solv-Ex Corporation and PheMex Establishment.
Financing Loan Agreement, dated on or about July 1996, between
PheMex Establishment and Waferprod.
Financing Loan Agreement, dated July 30, 1996, between Waferprod
Holding S.A. and Alulux Mining S.A.
Financing Loan Agreement, dated July 30, 1996, between Waferprod
Holding S.A. and Sandvest Petroleum S.A.
Financing Loan Facility Agreement, dated April 30, 1996, between
Silva Investment Limited and Alulux Mining S.A.
Financing Loan Facility Agreement, dated April 30, 1996, between
Silva Investment Limited and Sandvest Petroleum S.A.
Financing Loan Facility Agreement, dated June 16, 1996, between
Sandvest Petroleum S.A. and Russ Oil & Technology S.A.
Agreement among Morgan Grenfell, Marco Wolf and Juerg Wyler relating
to Alulux Mining S.A.
Agreement among Morgan Grenfell, Marco Wolf and Juerg Wyler relating
to Sandvest Petroleum S.A.
Agreement among Morgan Grenfell, Marco Wolf and Juerg Wyler relating
to Silva Investment Limited.
Agreement among Morgan Grenfell, Marco Wolf and Juerg Wyler relating
to PheMex Establishment.
<PAGE>
Agreement among Morgan Grenfell, Marco Wolf and Juerg Wyler relating
to Russ Oil & Technology S.A.
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief,
I certify that the information set forth in this statement is true, complete
and correct.
Dated: October 17, 1996
DEUTSCHE BANK AG
/s/ Dr. Ulrich Bosch
By: Dr. Ulrich Bosch
Title: Senior Vice President and Counsel
/s/ Dr. Dieter Eisele
By: Dr. Dieter Eisele
Title: Senior Vice President
and Group Head of Compliance
<PAGE>
SCHEDULE A
I. DBAG
Each person named below is a director or executive officer of DBAG,
whose principal business is described above in Item 2.
<PAGE>
<TABLE>
<CAPTION>
Present Principal
Name and Citizenship Business Address Occupation or Employment
<S> <C> <C>
Hilmar Kopper Deutsche Bank AG Member of the Board of Managing
German Taunusanlage 12 Directors, Deutsche Bank AG
60325 Frankfurt
The Federal Republic of Germany
Carl L. von Boehm-Bezing Deutsche Bank AG Member of the Board of Managing
German Taunusanlage 12 Directors, Deutsche Bank AG
60325 Frankfurt
The Federal Republic of Germany
Dr. Rolf-E. Breuer Deutsche Bank AG Member of the Board of Managing
German Taunusanlage 12 Directors, Deutsche Bank AG
60325 Frankfurt
The Federal Republic of Germany
Dr. Ulrich Cartellieri Deutsche Bank AG Member of the Board of Managing
German Taunusanlage 12 Directors, Deutsche Bank AG
60325 Frankfurt
The Federal Republic of Germany
Michael Dobson Deutsche Bank AG Member of the Board of Managing
United Kingdom Taunusanlage 12 Directors, Deutsche Bank AG
60325 Frankfurt
The Federal Republic of Germany
Dr. Michael Endres Deutsche Bank AG Member of the Board of Managing
German Taunusanlage 12 Directors, Deutsche Bank AG
60325 Frankfurt
The Federal Republic of Germany
Dr. Tessen von Heydebreck Deutsche Bank AG Member of the Board of Managing
German Taunusanlage 12 Directors, Deutsche Bank AG
60325 Frankfurt
The Federal Republic of Germany
Dr. Jurgen Krumnow Deutsche Bank AG Member of the Board of Managing
German Taunusanlage 12 Directors, Deutsche Bank AG
60325 Frankfurt
The Federal Republic of Germany
Georg Krupp Deutsche Bank AG Member of the Board of Managing
German Taunusanlage 12 Directors, Deutsche Bank AG
60325 Frankfurt
The Federal Republic of Germany
Dr. Ronaldo H. Schmitz Deutsche Bank AG Member of the Board of Managing
German Taunusanlage 12 Directors, Deutsche Bank AG
60325 Frankfurt
The Federal Republic of Germany
Ellen R. Schneider-Lenne Deutsche Bank AG Member of the Board of Managing
German Taunusanlage 12 Directors, Deutsche Bank AG
60325 Frankfurt
The Federal Republic of Germany
Dr. Ulrich Weiss Deutsche Bank AG Member of the Board of Managing
German Taunusanlage 12 Directors, Deutsche Bank AG
60325 Frankfurt
The Federal Republic of Germany
</TABLE>
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
10.1 Convertible Loan Agreement, dated on or about July 16, 1996,
between Solv-Ex Corporation and PheMex Establishment.
10.2 Financing Loan Agreement, dated on or about July 1996, between
PheMex Establishment and Waferprod.
10.3 Financing Loan Agreement, dated July 30, 1996, between Waferprod
Holding S.A. and Alulux Mining S.A.
10.4 Financing Loan Agreement, dated July 30, 1996, between Waferprod
Holding S.A. and Sandvest Petroleum S.A.
10.5 Financing Loan Facility Agreement, dated April 30, 1996, between
Silva Investment Limited and Alulux Mining S.A.
10.6 Financing Loan Facility Agreement, dated April 30, 1996, between
Silva Investment Limited and Sandvest Petroleum S.A.
10.7 Financing Loan Facility Agreement, dated June 16, 1996, between
Sandvest Petroleum S.A. and Russ Oil & Technology S.A.
10.8 Agreement among Morgan Grenfell, Marco Wolf and Juerg Wyler
relating to Alulux Mining S.A.
10.9 Agreement among Morgan Grenfell, Marco Wolf and Juerg Wyler
relating to Sandvest Petroleum S.A.
10.10 Agreement among Morgan Grenfell, Marco Wolf and Juerg Wyler
relating to Silva Investment Limited.
10.11 Agreement among Morgan Grenfell, Marco Wolf and Juerg Wyler
relating to PheMex Establishment.
10.12 Agreement among Morgan Grenfell, Marco Wolf and Juerg Wyler
relating to Russ Oil & Technology S.A.
<PAGE>
CONVERTIBLE LOAN AGREEMENT
between
PheMex Establishment, Altenbach 8,
P.O. Box 339, Fl-9490 Vaduz
(hereinafter referred to as "Lender")
and
Solv-Ex Corporation, 500 Marquette N.W.
Suite 300, Albuquerque, New Mexico 87102
(hereinafter referred to as "Solv-Ex.")
<PAGE>
INDEX
Preamble
Article Page
1 DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . 4
2 LOAN AMOUNT AND USE OF FUNDS . . . . . . . . . . . . . . . 8
3 INTEREST . . . . . . . . . . . . . . . . . . . . . . . . . 9
4 REPRESENTATIONS AND WARRANTEES . . . . . . . . . . . . . . 10
5 DRAW DOWN NOTICE AND DISBURSEMENT PROCEDURE . . . . . . . 16
6 CONVERSION AND SHARE CERTIFICATES . . . . . . . . . . . . 17
7 COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . 20
8 FEES . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
9 REPAYMENT . . . . . . . . . . . . . . . . . . . . . . . . 28
10 PAYMENTS . . . . . . . . . . . . . . . . . . . . . . . . . 29
11 DELAYED PAYMENTS . . . . . . . . . . . . . . . . . . . . . 30
12 SECURITY . . . . . . . . . . . . . . . . . . . . . . . . . 31
13 PROTECTION OF ENVIRONMENT . . . . . . . . . . . . . . . . 32
14 OTHER OBLIGATIONS OF SOLV-EX . . . . . . . . . . . . . . . 33
15 CONDITIONS PRECEDENT . . . . . . . . . . . . . . . . . . . 36
16 COSTS, CHARGES AND EXPENSES . . . . . . . . . . . . . . . 37
17 EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . 37
18 MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . 41
<PAGE>
PREAMBLE
A. WHEREAS the Lender is a company incorporated in 1995 under Liechtenstein
law with its registered office in Liechtenstein; and
B. WHEREAS Solv-Ex is a company incorporated in New Mexico with one class of
approximately 23'000'000 Common Shares outstanding which are quoted and
publicly traded on the NASDAQ Small Cap Market with a total of 30'000'000
of Common Shares authorized; and
C. WHEREAS Solv-Ex was formed in 1980 to develop a second generation
technology to efficiently extract oil from sands with small units and to
co-produce metal and mineral products from fine clays which were in the
past considered as waste tailings; and
D. WHEREAS Solv-Ex holds the Bituminous Lease near Fort Murray and the
management of Solv-Ex has decided to exploit the Bituminous Lease to
apply its technology and expertise for construction and operation of a
production facility to initially produce 14'000 barrels of oil and a
substantial amount of Alumina per day; and
E. WHEREAS Solv-Ex has successfully completed a significant amount of
research, development and pilot plant work to develop its process which
is protected by various patents to extract and upgrade oil from oil sands
and to market the oil under the registered trademark "PCO"; and
F. WHEREAS pursuant to the terms and conditions of an Offshore Distribution
and Sale Agreement dated March 21, 1996, the Lender has exercised its
rights to provide a loan to Solv-Ex in the amount of USD 33'000'000 for
the construction of a plant to extract and to upgrade the oil from the
oil sands to be mined from the Lease, thereby allowing Solv-Ex to
commence the construction of the Project; and
G. WHEREAS Solv-Ex will secure the Loan in the amount of USD 33'000'000 by
delivering 1'016'000 restricted Common Shares in Solv-Ex with a share
transfer form duly signed by Solv-Ex as a collateral to the Lender and by
consenting that the Lender may sell said shares if Solv-Ex is in an
unremediable default at his discretion; and
H. WHEREAS Solv-Ex and the Lender shall agree that the Loan of USD shall be
granted at a fixed interest rate of 12% per annum and that the Lender may
charge the first annual interest payable of USD 3'960'000 of the
Principal and whereas the interest in the second and the third year of
the Loan shall be paid on a quarterly basis in four equal installments of
USD 990'000 on April 30, July 31, September 30 and December 31 of the
respective year, and
I. WHEREAS Solv-Ex and the Lender shall agree that the Principal of USD
33'000'000 shall be convertible into shares in Solv-Ex in whole or in
part at the option of the Lender on a conversion price of USD 32.50 per
share at any time until the Principal and all interest shall be repaid in
full by Solv-Ex to the Lender, and
J. WHEREAS Solv-Ex shall only be permitted to spend USD 26'400'000 of USD
33'000'000 on the financing of the construction of the oil sands co-
production facility on the Bitumount Lease to commence with the oil
production under the trademark PCO in early 1997 to generate 14'000
barrels of oil per calendar day as well as a substantial amount of
alumina;
NOW, THEREFORE, in consideration of the mutual promises and covenants herein
contained, the Lender and Solv-Ex hereby agree as follows:
Article 1
DEFINITIONS:
<PAGE>
In the context of this Agreement the following terms shall mean:
"Agreement" shall mean this Convertible Loan Agreement.
"Appendices" shall mean Annexes to this Agreement, which shall form an
integral part of this Agreement.
"Business Day" shall mean each day which banks and foreign exchange markets
are open for business in such places contemplated for the transactions
required by this Agreement.
"Commitment" shall mean USD 33'000'000 (thirty three million).
"Common Shares" shall mean fully paid and non assessable Common Shares in
Solv-Ex, including the Common Shares issued or to be issued hereunder.
"Current Assets" shall mean the aggregate of Solv-Ex's cash, marketable
securities, trade and other receivables realizable within one year,
inventories and prepaid expenses which are to be charged to income within one
year.
"Current Liabilities" shall mean the aggregate of all liabilities of Solv-Ex
falling due on demand or within one year, including dividends to be disbursed
and the portion of long-term debt falling due within one year, but excluding
liabilities for property, plant and equipment to the extent of the amount of
funds therefore excluded from the calculation of Current Assets.
"Current Ratio" shall mean the result obtained by dividing Current Assets by
Current Liabilities.
"Debt" shall mean the aggregate of all obligations of Solv-Ex then outstanding
for the payment or repayment of money, also including:
- - any amounts payable by Solv-Ex under leases or similar arrangements with
respect to vehicles, plant and equipment over their respective periods;
- - any credit to Solv-Ex from a supplier of goods or under any instalment
purchase or other similar arrangement; and
- - the aggregate amount at that time outstanding liabilities and obligations
of third parties to the extent that they are guaranteed by Solv-Ex.
"Drawdown Date" shall mean the date upon which the Commitment is made
available to Solv-Ex.
"Equity" shall mean shareholders' equity, effectuated in accordance with the
GAAP of the United States certified by the Auditors and approved by Solv-Ex.
"Exercise Price" shall mean USD 32.50 for each Common Share in Solv-Ex which
are held in escrow by the Escrow Agent on behalf of Solv-Ex and the Lender.
"Expiry Date" shall mean April 15, 1999, 4 pm.
"GAAP" shall mean the American Generally Accepted Accounting Principles,
consistently applied.
"Interest Payment Date" shall mean on the same day as the Drawdown was
presented in each year. Should this date not fall on a Business Day, the
Interest Payment Date will be the first Business Day thereafter.
"Interest Rate" shall mean 12% per annum on the Principal of USD 33'000'000
throughout the Loan Period calculated from the Drawdown Date.
"Interest Period" shall mean the period from, and including, the day of
disbursement and ending on the day immediately and including, subsequent
Interest Payment Dates and ending on the day immediately before the Interest
Payment Dates thereafter.
"Interest Payment Date" shall mean that the interest for the first year of USD
3'960'000 shall be paid in advance and may be deducted from the Principal of
USD 33'000'000 by the Lender and whereas the interest in the second and the
third year of the Loan shall be paid on a quarterly basis in four equal
instalment of USD 990'000 on April 30, July 31, September 30 and December 31.
"Loan" shall mean the funds made available to Solv-Ex under this Agreement and
any portion thereof.
"Net Worth" shall mean the difference between net assets and net liabilities.
"Pledge over Shares" shall mean that the 1'016'000 Common Shares which will be
granted by Solv-Ex as a collateral to the Lender shall, with all dividends and
bonuses and all rights and benefits attached, thereon constitute a continuing
security to the Lender for the Repayment of the principal and all interest on
the Loan.
"Principal" shall mean USD 33'000'000.
"Project" shall mean the investment as set out in the Business Plan of Solv-Ex
which describes a plant to extract 14'000 barrels of oil to be upgraded into
<PAGE>
marketable heavy crude oil and whose estimated cost shall amount to USD
125'000'000.
"Project Completion Date" shall mean September 30, 1997.
"Repayment Date" shall mean the date prior to which the Lender converts the
Principal or the repayment of USD 33'000'000 on April 30, 1999 into shares in
Solv-Ex.
"Right of Conversion" shall mean the right of the Lender to convert a part or
all of USD 33'000'000 into 1'016'000 Common Shares in Solv-Ex which are held
by the Lender by submitting a written statement that he is converting the Loan
into 1'016'000 Common Shares in Solv-Ex and by sending the certificate of
1'016'000 of the Common Shares in Solv-Ex for reregistration to the transfer
agent of Solv-Ex in order that a new certificate shall be issued to an entity
to be identified by the Lender.
"Security Documents" shall mean the transfer form duly executed by Solv-Ex
that the certificate of 1'016'000 shares of Common Shares in Solv-Ex may be
transferred and are to be reregistered by the transfer agent of Solv-Ex.
"Securities Exchange Act" shall mean the Securities Exchange Act of the United
States of 1934.
"Securities and Exchange Commission" shall mean the Securities and Exchange
Commission of the United States.
"USD and US Dollars" shall mean the lawful currency of the United States of
America.
Article 2
LOAN AMOUNT AND USE OF FUNDS
The Lender undertakes to provide Solv-Ex with a loan of USD 33'000'000 (thirty
three million United States Dollars) and Solv-Ex shall accept this Loan on the
following terms and conditions. The Lender will disburse 26'400'000 to Solv-
Ex. Solv-Ex hereby approves that the commission of 7% of Fiba Nordic
Securities (UK) Ltd., the cost for setting up this Loan Agreement of 1% and
the interest for the first year may be deducted and paid by the Lender
directly.
Article 3
INTEREST
3.1 Solv-Ex shall pay interest at the rate of 12% p.a. (twelve per cent per
annum) on loan balances outstanding after the signing of this Agreement.
3.2 Interest will be owed from the day of disbursement of the Loan and is
debited until the day immediately before repayments are credited to the
Lender's account.
3.3 Interest for the first year of USD 3'960'000 shall be paid in advance and
may be deducted from the Principal of USD 33'000'000 by the Lender, in
the second and the third year the interest shall be paid on a quarterly
basis in four equal installments of USD 990'000 on April 30, July 31,
September 30 and December 31. For the purpose of calculating interest
payable, a year shall comprise 360 days and a month shall comprise 30
days. Interest payable in respect of each calendar day shall be
calculated by dividing annual interest due by 360.
3.4 Interest shall be payable by Solv-Ex without deduction or retention of
any present or future tax liabilities, charges or official payments
whatsoever, except where such deduction or retention is prescribed by law
in such cases, Solv-Ex shall make an additional payment to the effect to
fully compensate the deducted or retained amount.
Article 4
REPRESENTATIONS AND WARRANTEES
4.1 Solv-Ex is a corporation duly incorporated and in good standing under the
laws of the jurisdiction of New Mexico, is duly authorized to transact
business in each jurisdiction in which its business is conducted, and is
duly authorized and empowered by its corporate bodies to complete the
transactions herein. Solv-Ex hereby assures that all corporate action
required on its part to complete the transactions herein contemplated
have been duly and effectively taken.
<PAGE>
4.2 Solv-Ex has by proper corporate action authorized and reserved the number
of unissued shares of Common Stock of the Company required for the
conversion of the Debt into Common Shares in Solv-Ex. This Convertible
Loan Agreement will be a valid and enforceable obligation of Solv-Ex and
Solv-Ex warrantees that it is in accordance with its Corporate Charter,
Bylaws, or any other agreement entered by Solv-Ex and that the terms of
this Agreement do not violate any provision of Law.
4.3 Solv-Ex has furnished to the Lender Financial Statements of 1993, 1994,
1995 and other disclosure information contained in the documents referred
to hereinafter. Solv-Ex hereby represents and warrants that the Annual
Financial Statements which were established by consistently applying the
GAAP and the documents hereinafter referred to are true, complete and
accurate as at the date thereof:
(a) Annual report on Form 10-K for the year ending June 30, 1995;
(b) Quarterly reports on Form 10-Q for the quarters ending September 30,
1995 and December 31, 1995;
(c) Current reports on Form 8-K and press releases dated subsequent to
June 30, 1995;
(d) Business Plan describing the Project and containing certain forward-
looking information which is subject to the qualifications stated
therein.
4.4 Solv-Ex hereby warrants, that there has been no material adverse change
in the condition, financial or otherwise, of the Company and its
subsidiaries taken as a whole since December 31, 1995.
4.5 Solv-Ex hereby warrants, directly or indirectly through related parties,
that it has good title, free and clear of all liens and encumbrances to
all material real estate, plants, fixed property and to all other
properties and assets reflected on Solv-Ex's financial statements other
than as disposed of in the ordinary course of business since the date of
such financial statements.
4.6 Further Solv-Ex warrantees that it is not in material default under any
indenture, mortgage, deed of trust, agreement or other instrument to
which it is a party or by which it may be bound. Neither the execution
and delivery of this Agreement or any instrument or document to be
delivered under this Agreement, the completion of the transactions
contemplated herein or therein, nor compliance with the provisions hereof
and thereof, will: violate any law, regulation, order, or decree; nor
will they conflict with, or result in the breach of, or constitute a
default under, any indenture, mortgage, deed of trust, agreement, or
other instrument to which Solv-Ex is a party or by which it is bound; nor
will they result in the creation or imposition of any lien, charge, or
encumbrance upon any of the Company's property thereunder, or violate any
provision of the Company's Articles, Certificate of Incorporation, or
Bylaws.
4.7 Solv-Ex holds valid leases covering the use or occupancy of all property
or assets used in its respective businesses and none of said leases is in
default. Solv-Ex warrantees that it shall not encumber or dispose in any
kind of the Bituminous Lease 7276120T05 without the previous written
consent of the Lender. The Lender shall only withhold such a consent
with proper cause if Solv-Ex wants to encumber said lease to set up the
rest financing to finalize the Project.
4.8 Solv-Ex warrantees that it is not a party to any agreement or instrument
or subject to any corporate restriction (including any restriction set
forth in its Articles or Certificate of Incorporation) materially and
adversely affecting its operations, business, properties, or financial
conditions.
<PAGE>
4.9 Solv-Ex possesses all the material trademarks, trade names, copyrights,
patents, licenses, permits (including those for environmental compliance)
or rights, adequate for the conduct of its respective business, in
particular, extraction of minerals and other resources in the United
States and any other country, as now conducted and presently proposed to
be conducted, without conflict with the rights or claimed rights of
others.
4.10 Solv-Ex hereby warrantees that there is no litigation, legal or
administrative proceedings, investigation or other action of any nature
pending or, to its knowledge, threatened against or affecting it which
involves the possibility of any judgment or liability not fully covered
by insurance or which may materially and adversely affect any of the
assets of Solv-Ex or its respective rights to carry on business as now
conducted. Solv-Ex has disclosed to the Lender certain documents
regarding an ongoing investigation of the Securities and Exchange
Commission about the trading or issuance of Common Shares in Solv-Ex.
4.11 No action of, or filing with, any governmental or public body or
authority is required to authorize, or is otherwise required, in
connection with the execution, delivery, and performance of this
Agreement or any instrument or document to be delivered pursuant to the
Agreement, except that the filing with respect to the capital structure
must be reported to the Securities and Exchange Commission of the United
States and Nasdaq immediately after having executed this Agreement.
Solv-Ex shall document the Lender with a certified copy of its filing of
this Agreement to the Lender within five business days after compilation
of such filing.
4.12 All federal, state and other tax returns and reports of Solv-Ex required
by United States law to be filed, have been duly filed and all federal,
state and other taxes, assessments, fees and other governmental charges
(other than those presently payable without penalty) imposed upon Solv-Ex
or the properties or assets of Solv-Ex which are due and payable have
been paid.
4.13 Neither Solv-Ex nor any agent acting on its behalf has offered the common
stock underlying this Convertible Loan Agreement to any person or persons
other than the Lender.
4.14 Solv-Ex shall inform the Lender promptly and in writing of any change in
the aforementioned representations.
Article 5
DRAW DOWN NOTICE AND DISBURSEMENT PROCEDURE
5.1 The Loan of USD 33'000'000 will be disbursed in one payment of USD
26'400'000 as described in Article 2 of this Agreement upon presentation
of a draw down notice by Solv-Ex. The Commitment shall be made available
to Solv-Ex in one amount five days after the presentation of a Drawdown
Notice to an account specified by the Lender.
5.2 A drawdown notice shall only be valid if it corresponds to the contents
of Appendix 2 of this Agreement and its submission to the Lender
represents the last condition precedent to disbursement.
Article 6
CONVERSION AND SHARE CERTIFICATES
6.1 The Principal shall be convertible at the option of the Lender into
Common Shares of Solv-Ex based on an exercise price of USD 32.50 per
share at any time until the termination of this Agreement.
6.2 Solv-Ex warrants that by proper action of its Board of Directors it has
appropriated and reserved the number of the now authorized and unissued
<PAGE>
shares in Solv-Ex's Common Stock to allow the conversion of the
Convertible Debt of USD 33'000'000 upon a written statement into
1'016'000 Common Shares in Solv-Ex. Solv-Ex shall irrevocably instruct
its transfer agent to reregister the certificate of 1'016'000 of the
Common Shares in Solv-Ex to issue and send a new certificate to an entity
to be identified by the Lender within seven business days after having
received the certificate provided as a collateral for this Loan of
1'016'000 Common Shares in Solv-Ex for exchange.
6.3 Whenever Solv-Ex will issue shares of its common stock for no
consideration (such as in the case of a stock split or stock dividend) or
whenever Solv-Ex will reclassify the shares into a smaller number of
shares (such as in the case of a reverse stock split) then, upon such
issue or reclassification, the conversion price shall be reduced (or
increased in the case of a reverse stock split or similar actions which
result in a lesser number of shares outstanding) by multiplying the
conversion price immediately prior to the transaction requiring the
adjustment by a fraction of which the numerator shall be the number of
Common Shares outstanding immediately prior to such transaction and the
denominator shall be the total number of Common Shares outstanding
immediately after such transaction. For the purpose of this provision,
the Common Shares outstanding shall include shares held by Solv-Ex if
such dividend, distribution, combination or subdivision is made with
respect to, or affects, such shares. The certificate of any firm of
independent public accountants of recognized standing selected by the
Board of Directors of Solv-Ex shall be conclusive evidence of the
correctness of any computation made.
6.4 If Solv-Ex shall consolidate or merge with or into any other corporation
or shall sell all or substantially all of its property as an entirety,
lawful provision shall be made a part of the terms of such transaction
that the Lender may then or thereafter, upon exercise thereof, receive in
lieu of each Common Share issuable to them upon such exercise and with
the same protection against dilution (all as herein provided) the same
kind and amount of stock (and other securities and assets, if any) as may
be issuable or distributable upon such transaction with respect to each
outstanding Common Share, and after such transaction the conversion
rights of the Lender shall be merely to receive upon exercise thereof
such stock (and other securities and assets, if any). Upon the
conversion of the Convertible Debt, Solv-Ex shall not issue a fractional
share but shall issue the largest number of full shares obtainable upon
such conversion and no account shall be taken of any right in respect of
a fractional share.
Article 7
COVENANTS
7.1 Solv-Ex will duly and punctually pay the principal and interest on the
dates and in the manner provided in this Loan Agreement.
7.2 Solv-Ex will provide to the Lender financial and other material
information concerning operations, especially all information and
documents regarding the Investigation with the Securities and Exchange
Commission and any other investigating governmental authorities to which
it has access or to which it will have access.
(a) as soon as practicable, two copies of each annual and interim
financial and other report or communication sent by the Company to
its shareholders or filed with the Securities and Exchange
Commission;
(b) as soon as practicable, two copies of every press release and every
material news item and article in respect of the corporate affairs
of the Company which is released for publication by the Company; and
<PAGE>
(c) such additional non-confidential and readily available documents and
information with respect to Solv-Ex and its business affairs and the
business affairs of any Subsidiaries as the Lender may request from
time to time in writing.
7.3 Solv-Ex will pay promptly and discharge all taxes lawfully levied or
imposed, pay when due all lawful claims for liabilities which if unpaid
would by law be a lien or charge upon the property of Solv-Ex or lead to
the suspension of the business of Solv-Ex; provided, however, that
nothing herein shall require it to make any such payment or compliance so
long as it is in good faith and by appropriate proceedings diligently
conducts contests of its obligation to do so, if such reserve as shall be
required by Generally Accepted Accounting Principles shall have been made
therefore, and if such contest will not result in the forfeiture or loss
of any property of Solv-Ex.
7.4 Solv-Ex will maintain insurance with financially sound and reputable
insurers, with respect to its properties and business against such
casualties and contingencies, and in such types and amounts as may be
required by the Lender from time to time. Schedules of all insurance of
Solv-Ex and each Subsidiary will be submitted to the Lender within 30
days after signing of this Agreement. Such schedules will contain a
description of the risks covered, the amounts of insurance carried on
each risk, the name of the insurer and the cost of such insurance to
Solv-Ex. Solv-Ex shall be obliged to insure the production plant
reflecting its cost.
7.5 Solv-Ex will, at all times, keep, and will cause each of its subsidiaries
to keep true and complete books and records in connection with its assets
and operations, in accordance with GAAP.
7.6 Solv-Ex will maintain in good repair, working order and condition all
properties used and useful in the business of Solv-Ex and make all such
repairs, renewals, replacements, additions and improvements thereto as
may be needed and appropriate.
7.7 Solv-Ex will maintain its status as a reporting company and will continue
to file reports as required by Sections 12 and 13 of the Securities
Exchange Act of 1934. Solv-Ex will furnish to the Lender a copy of any
report filed with the Securities and Exchange Commission pursuant to said
Sections within 5 business days after filing such reports with the
Securities Exchange Commission. Solv-Ex undertakes to furnish the Lender
with all the relevant information and documents regarding all
communications with the Securities and Exchange Commission.
7.8 Solv-Ex shall maintain the following ratios and tangible net worth:
(a) Current assets divided by current liabilities (as reflected in the
financial statements contained in any report filed with the
Securities and Exchange Commission) shall not be less than 1.2.
(b) Net Worth (shareholders' equity) divided by total indebtedness (not
including contingent indebtedness) (as reflected in the financial
statements contained in any report filed with the Securities and
Exchange Commission) shall not be less than 1.
(c) Tangible Net Worth (shareholders' equity) as reflected in the
financial statements contained in any report filed with the
Securities Exchange Commission shall not be less than USD 5,000,000.
7.9 Solv-Ex shall conduct, directly or indirectly through any subsidiary,
only those businesses and activities in which Solv-Ex is presently
actively engaged, or which are disclosed in the Business Plan referred to
in Section 4.2(d) hereof.
<PAGE>
7.10 Solv-Ex will promptly furnish on request of the Lender such information
as may be reasonably necessary to determine whether (a) it is complying
with its covenants and agreements contained in the Loan Agreement, (b) an
event of default has occurred hereunder at any time.
7.11 Solv-Ex will permit, at such reasonable times as will not unreasonably
interfere with the conduct of the business, the Lender or any of the
Lender officers, employees or designated representatives to visit and
inspect any property of Solv-Ex and make available for inspection or
copying to any such officer, employee or designated representative any of
Solv-Ex's books and records. A designated officer of Solv-Ex will
discuss with the Lender, or any of the Lender's officers, employees or
designated representatives, any of the affairs, finances and accounts at
such reasonable times and as often as the Lender may reasonably request.
7.12 No default exists with respect to any indebtedness of Solv-Ex or its
subsidiaries for borrowed money or any agreement or indenture relating
thereto.
7.13 Solv-Ex shall make full and timely payment of the principal and interest
and duly comply with all terms and covenants contained pursuant to this
Agreement.
7.14 Solv-Ex shall, at its own expense, upon Lender's request, duly execute
and deliver to the Lender all further instruments and do, and cause to be
done, all further acts necessary and proper, in the Lender's opinion, to
carry out more efficiently the provisions and purposes of this Agreement.
7.15 Solv-Ex undertakes with the Lender as from the date hereof and for so
long as any amounts are owned by Solv-Ex to the Lender hereunder that it
will and shall procure that:
(a) Solv-Ex shall not make any advances except in the ordinary course of
business or make any loan other than to a subsidiary (if any)
without the previous written consent of the Lender. The Lender
shall only withhold such approval with proper cause.
(b) Solv-Ex shall not raise a Loan except with the previous written
consent of the Lender. The Lender approves by consenting to a
further debt financing of Solv-Ex to finalize the Project that his
claim shall be subordinated thereto. The Lender approves by
consenting to a further debt financing of Solv-Ex to finalize the
Project that his claim shall be subordinated thereto. The Lender
shall only withhold such approval with proper cause.
(c) Solv-Ex or its subsidiaries shall not, without the previous written
consent of the Lender, incur or secure by way of any of its assets
any indebtedness; the Lender may not withhold such approval
unreasonably.
(d) Solv-Ex shall not directly or indirectly purchase, acquire, redeem
or retire any shares of its Common Shares outstanding other than to
accept shares in payment of the exercise price for stock options
granted by Solv-Ex in accordance with the terms of such options.
(e) Solv-Ex shall not pay any dividends in any fiscal year, including
the current year (other than dividends payable solely in its shares)
except with the written consent of Lender. The Lender may only
withhold such approval with proper cause.
(f) Solv-Ex shall not consolidate or merge with, or purchase, all or a
substantial part of the assets of any corporation, firm, association
or enterprise, or sell, lease or otherwise transfer any assets or
other than in the normal course of its business, except that this
restriction shall not prevent any subsidiary of Solv-Ex (now
existing or hereafter formed) from liquidation into or merger with
<PAGE>
Solv-Ex or with another subsidiary provided that in any merger
involving Solv-Ex, Solv-Ex shall be the surviving corporation. This
restriction shall not be deemed to preclude Solv-Ex for entering
into a joint venture or similar arrangement to obtain financing of
the Project provided it has received the previous written consent of
the Lender. Such consent shall not be withheld without proper
cause.
Article 8
FEES
Solv-Ex shall pay a one time commitment fee on the aggregate Loan of 1%
p.a., after signing of this Agreement and it hereby approves that USD
330'000 are charged by the Lender on the disbursement of the Loan.
Article 9
REPAYMENT
9.1 Solv-Ex shall repay the Loan of USD 33'000'000 in one instalment on April
15, 1999, if the Lender has not previously exercised his right to convert
the Principal into shares in Solv-Ex at the Exercise Price.
9.2 Provided that the Lender has made use of his Right of Conversion no
repayment shall become due under this Agreement.
Article 10
PAYMENTS
10.1 Payment obligations of Solv-Ex arising from this Agreement are satisfied
only if and in so far as, after deduction of all costs and expenses, the
respective amounts are credited not later than 9:00 a.m. local time on
their due dates to the Lender's bank account in United States Dollars
which shall be nominated to Solv-Ex not later than 7 days prior to the
respective obligation falling due.
10.2 The setting off of counterclaims against the Lender's claims arising from
this Agreement as well as Solv-Ex's right to withhold payments shall not
be permitted. This shall not apply to the setting off of Solv-Ex's
claims that are undisputed or that have been adjudicated upon without
recourse.
10.3 In so far as Solv-Ex's payments do not satisfy all due obligations, the
Lender may determine to which obligations they shall be applied.
10.4 Should Solv-Ex be compelled by legal regulations to make lesser payments
than are due or payments in a currency other than that contracted, it
shall be obliged to make further payments until the contracted sum has
been reached and, in the case of payment in a currency not specified in
this Agreement, shall be obliged to pay the difference between the
contracted amount and the equivalent in United States Dollars of the
amount paid converted at the same time.
Article 11
DELAYED PAYMENTS
11.1 For repayments which are not made on their due dates, additional interest
of 5% p.a., calculated from such due date to the date of payment, shall
be payable. The payment has to be effected on the next Interest Payment
Date.
11.2 In the event that interest due to the Lender is not paid, Solv-Ex shall
be obliged to make a penalty payment to the Lender. By way of penalty
payment, Solv-Ex shall pay the Lender an amount equalling interest on the
delayed payments for the period of their delay at a rate being five
percentage points above the interest agreed.
<PAGE>
Article 12
SECURITY
12.1 Solv-Ex assures that its assets as specified in the afore-mentioned
financial statements which form Appendix 3 hereto are not pledged by any
other charges than those mentioned in such financial statements provided
to the Lender.
12.2 Solv-Ex shall not pledge its assets or part thereof without the Lender's
prior consent in writing. The Lender may not withhold such consent
unreasonably.
12.3 Solv-Ex shall provide certificates of 1,016,000 Common Shares in Solv-Ex
as a collateral of the Loan of the Lender. The Lender and Solv-Ex hereby
agree that the 1,016,000 Common Shares in Solv-Ex may be sold by the
Lender in accordance with the applicable laws if Solv-Ex will not remove
the occurrence of a default within 30 days and Solv-Ex hereby approves
that the Lender may compensate the returns of such sale against the
principal and the interest due.
12.4 At the Lender's request, Solv-Ex shall, at any time during the
effectiveness of this Agreement, create and register in favour of the
Lender securities over such of its assets as the Lender will specify to
cover the balance then outstanding of the Loan plus interest and other
claims as stipulated in this Agreement. If the Lender has asked for more
security, Solv-Ex shall have the right to prepay the Loan in one
installment to the Lender within 30 days after such request was received.
Article 13
PROTECTION OF ENVIRONMENT
Solv-Ex undertakes to put in place at any time measures necessary to ensure
environmental protection and occupational health and safety in accordance with
the specific Environmental Regulations of the Province of Alberta and Canada
in particular to ensure that
a) the special protection measures mentioned in the Project Description are
properly implemented and maintained;
b) plans as set out in the Project Description are developed and implemented
for the environmental improvement of the existing installations;
c) the necessary measures are promptly taken to protect against
environmental dangers which arise or become known at a later date;
d) the Lender receives annual reports on the performance of Solv-Ex's plant
concerning environmental protection on occupational health and safety and
containing such detailed information as set out in the Project
Description;
e) the Lender is notified forthwith of unusual events concerning the
environment or occupational health and safety and special measures taken.
Article 14
OTHER OBLIGATIONS OF SOLV-EX
14.1 Solv-Ex undertakes:
a) to implement the Project in strict conformity with the Project
Description, to carry out its business activities in general in
accordance with accepted principles of care, prudence and commercial
practice as well as in conformity with commercial, financial and
technical standards in force, and to retain sufficient qualified
personnel;
b) to obtain all consents, permissions, approvals, licenses and
authorizations from, among others, authorities, shareholders and
creditors, and, where necessary to keep them in force and to renew them
as required by the applicable laws, statutes, regulations and agreements
in order to fulfill this Agreement and not to breach the terms of such
consents, permissions, approvals, licenses and authorizations;
<PAGE>
c) to provide the Lender at any time upon request with any information about
itself and its business activities and to provide copies of requested
documents and papers (including correspondence, contracts, minutes of
meetings);
d) to permit access for the Lender's authorized representatives to its
business and works premises at any time during normal working hours as
well as inspection and examination of its financial records and all
business papers and documents, if Solv-Ex does not comply with an
obligation under this Agreement;
e) to ensure that its obligations under this Agreement are always given at
least equal treatment to those of other creditors as set out in the
Project Description with respect to their fulfillment and security, in
particular not to undertake early repayment of other loan or credit
liabilities without the prior written consent of the Lender;
f) to sign a Registration Rights Agreement if the Lender will have used his
right to convert this Loan into 1,016,000 Common Shares in Solv-Ex.
Provided, however, that no such Registration Right Agreement shall be
required the Lender shall receive a legal opinion of a legal counsel
admitted to practice in the United States paid by Solv-Ex that the shares
are otherwise marketable in an equal manner in the United States under
Regulation S promulgated under the Securities Act of 1933 within 90 days
following transfer of the Common Shares of the Lender or another
exception for registration requirements to be available under said act.
14.2 If Solv-Ex decides to market the technology in Europe Solv-Ex shall
provide the exclusive right to the Lender to market the technology used
within the Project in Europe. Solv-Ex shall provide a complete list of
all patents and a full description of the technology used to the Lender
within 30 days after the signing of this Agreement.
Article 15
CONDITIONS PRECEDENT
15.1 The obligation of the Lender to make the Loan available is conditional
upon the Lender having received in form and substance satisfactory to
itself and its legal advisers;
a) Execution of this Agreement and all Appendices hereto;
b) Delivery of a Certificate of 1,016,000 Common Shares in Solv-Ex as
well as a Stock Transfer form, duly executed by Solv-Ex as a
Collateral to the Lender;
c) Drawdown Notice of Solv-Ex.
15.2 Solv-Ex shall deliver the Certificate of 1,016,000 Common Shares in Solv-
Ex as well as a Stock Transfer form, duly executed by Solv-Ex to the
Lender on April 15, 1996. The Lender shall duly sign this Agreement on
April 18, 1996.
Article 16
COSTS, CHARGES AND EXPENSES
Solv-Ex shall bear the costs, taxes, fees and other charges and expenses
incurred in connection with the conclusion and implementation of this
Agreement, and the Registration Right Agreement, in particular those with
respect to the issue, the creation, registration, enforcement and, if
necessary, the cancellation of securities, with the disbursement of the Loan,
the transfer and remittance of all payments to be made under this Agreement
and with pursuance and enforcement of rights in connection with this
Agreement.
Article 17
<PAGE>
EVENTS OF DEFAULT
17.1 Each of the following events shall be an Event of Default:
a) any principal of, or interest on, the Loan or any other amount due
under this Agreement is not paid upon the due date for payment
thereof;
b) there is a material (in the sole opinion of the Lender) default on
the part of Solv-Ex under any of the provisions of this Agreement
(other than a) above) which (if in the sole opinion of the Lender it
would be capable of being remedied) is not remedied within 30 days
after notice to Solv-Ex requesting action to remedy such default;
c) any representation made by Solv-Ex in this Agreement or any notice,
certificate, or written statement delivered or made pursuant hereto
proves to be misleading or materially incorrect or inaccurate when
made;
d) the Lender's funding is declared due for repayment prior to the
stated maturity thereof as a result of the occurrence of an event of
default under the Loan Agreement;
e) a distress or other execution is levied upon or against any
substantial part of the property of Solv-Ex and is not discharged
within 30 days, unless such distress or execution is contested in
good faith by Solv-Ex in appropriate proceedings diligently pursued
which protect Solv-Ex's interest in such property;
f) an order of a competent court or an event analogous thereto shall be
made, or any effective resolution shall be passed, with a view to
the bankruptcy, composition proceedings, liquidation or winding-up
of Solv-Ex;
g) Solv-Ex is unable or admits its inability in writing to pay its
lawful debts as they mature, or makes a general assignment for the
benefit of its creditors;
h) Solv-Ex ceases or threatens to cease to carry on its business or
dispose or threatens to dispose of a substantial part of its
business, properties or assets or of any portion of the Lender's
share holding to any acquiror other than the Lender, or the same are
seized or appropriated for any reason;
i) the Articles of Incorporation and/or Bylaws (if any) of Solv-Ex are
modified in any material way (in the sole opinion of the Lender)
without the prior consent in writing from the Lender;
j) any license, consent, permission or approval required in connection
with the implementation, maintenance and performance of this
Agreement is revoked, terminated or modified in a manner
unacceptable to the Lender;
k) two or more of the 5 key employees of Solv-Ex should resign their
positions during the Loan Period and their positions are not filled
by persons of a comparable competence acceptable to the Lender (such
approval must not be withheld unreasonably) within 3 months of the
date of the relevant resignation;
l) a material adverse change occurs in the financing condition of Solv-
Ex, by way of the operation, equity or result of Solv-Ex
deteriorating to such extent that more than 50% of Solv-Ex's Equity
has been lost at any time during the Loan Period and provided that
the earnings of Solv-Ex at that time, in the reasonable opinion of
the Lenders and Solv-Ex's auditors, make it unlikely that such
equity will be regained within a period of six months.
<PAGE>
17.2 Upon the occurrence of any Event of Default referred to in this Clause
and so long as such Event of Default continues, the Lender may, and in
case of default as set forth in Subclause d) of this Agreement, shall
accelerate the Loan and the Lender shall forthwith notify Solv-Ex in
writing that the entire amount of the Loan outstanding together with
interest and all other amounts outstanding under this Agreement shall
become immediately due and payable, and failing full repayment of all
amounts then outstanding to the Lender the Certificate of 1,016,000 of
Common Shares in Solv-Ex may be sold by the Lender at his discretion and
compensated towards the Principal of Solv-Ex.
Article 18
MISCELLANEOUS
18.1 All communications in connection with this Agreement shall be sent in
writing in English to the following addresses:
SOLV-EX Corporation
500 Marquette NW, Suite 300
Albuquerque
New Mexico 87102
Phemex Est.
Altenbach 8
Postfach 339
FL-9490 Vaduz
Each party hereto undertakes to notify the other party of any change of
address.
18.2 Solv-Ex shall not assign or transfer, pledge or mortgage any rights under
this Agreement.
18.3 Any modification or amendment of this Agreement must be in writing.
18.4 Should any of the provisions of this Agreement be void for whatsoever
reason, the validity of the remaining provisions shall thereby not be
affected. In such case the parties to this Agreement shall, without any
delay, replace the ineffective provision by a legally effective one which
in its consequences shall approximate the ineffective provision as
closely as possible.
18.5 In case the Lender does not exercise any right to which it is entitled
under this Agreement, such an omission shall not be considered to
constitute a waiver of such right.
18.6 This Agreement shall be effective upon the date first above written and
shall remain binding as long as any amount is due to the Lender.
18.7 This Agreement shall be governed by, and construed in acceptance with,
the laws of the United Kingdom.
18.8 Exclusive jurisdiction in connection with this Agreement lies with the
competent courts of the City of London. Notwithstanding anything to the
contrary, the Lender may have recourse to any competent court or a court
of arbitration established in accordance with the rules and regulations
of the International Chamber of Commerce, Paris, whose award shall be
final and binding.
IN WITNESS WHEREOF, the parties hereto, acting through their duly authorized
representatives, have caused this Agreement to be signed in their respective
names as of the day and year first above written.
The LENDER: Phemex Est.
<PAGE>
[signature illegible]
SOLV-Ex Corporation
/s/ Herbert Campbell
<PAGE>
FINANCING LOAN FACILITY AGREEMENT
USD 33,000,000
WAFERPROD HOLDING S.A.
as Lender
and
PHEMEX ESTABLISHMENT
as Borrower
I N D E X
<TABLE>
<CAPTION>
Clause number Subject matter Page number
<S> <C> <C>
1 LOAN AND PURPOSE 3
2 DEFINITIONS 4
3 FINANCING LOAN 5
4 LENDER'S COMPENSATION 5
5 REPAYMENT 5
6 EVENTS OF DEFAULT 6
7 FEES, COSTS AND EXPENSES 7
8 PAYMENTS 7
9 NOTICES AND CORRESPONDENCE 7
10 WRITTEN FORM 8
11 GOVERNING LAW AND JURISDICTION 8
</TABLE>
In this Agreement the following terms and expressions shall have the following
meanings:
"Agreement" shall mean this Agreement and shall include all amendments and
modifications.
"Banking Day" shall mean a day on which banks and foreign exchange markets are
open for business in such places contemplated for the transactions as required
by this Agreement.
"Drawdown Date" shall mean the date upon which the Commitment is made
available to the Borrower.
"Events of Default" shall mean the occurrence and continuance of any of the
events listed in Clause 6 of this Agreement.
<PAGE>
"Financing Loan" shall mean the loans and other financial accommodations made
by the Lender under this Agreement in the aggregate amount of USD 330,000,000.
"GAAP" shall mean Generally Accepted Accounting Principles, consistently
applied.
"Interest" shall mean that the Lender shall receive a potential dividend paid
by Solv-Ex instead of interest.
"Lender's Fee" shall mean a one time fee in the amount of 6% of the Financing
Loan.
"Phemex" shall mean Phemex Establishment, 9490 Vaduz, an entity which will
conclude a Convertible Loan Agreement with Solv-Ex Corporation, which will
have the right to convert USD 33,000,000 into shares at a strike price of USD
32.50.
"Solv-Ex Corporation" shall mean a company incorporated in New Mexico with one
class of approximately 23,000,000 Common Shares outstanding quoted and
publicly traded on the NASDAQ Small Cap Market.
"Repayment" shall mean the Borrower shall be liable to repay the respective
amount reflecting the average listed price of the last five banking days of
the shares in Solv-Ex Corporation previous to the repayment date, multiplied
by 1,015,385 (the result of the division of the aggregate Loan and the strike
price of the option on the Solv-Ex shares by Phemex Establishment of USD
32.50). Repayment shall be replaced provided Phemex shall have converted its
Financing Loan into shares in order to receive 1,015,385 shares in Solv-Ex.
"Tax" shall mean all or any levies, imposts, duties, charges, fees, deductions
and withholdings levied or imposed by any national or governmental or public
body or authority with respect to the Loan.
"USD" shall mean the lawful currency of the United States.
Where the context of this Agreement so allows, words importing the singular
include the plural and vice versa.
3. THE FINANCING LOAN
The Lender agrees, on the terms and conditions set forth hereinafter, to
lend the Borrower, on his request, a sum of USD 33,000,000. After the
deduction of the Lender's Fee of USD 1,980,000 as specified in Cif. 4.1,
the Borrower shall receive a payment of USD 31,020,000.
4. LENDER'S COMPENSATION
4.1 The Borrower undertakes to pay a Lender's Fee of 6% of the Financing Loan
in the amount of USD 1,980,000 to the Lender, payable in advance and
consents that the Lender shall deduct USD 1,980,000 from the Principal.
4.2 Interest payments shall be remitted in the respective amount reflecting
the dividend of Solv-Ex Corporation to its shareholders.
5. REPAYMENT
5.1 The Loan shall be repaid in the respective amount reflecting the average
listed price of the last five banking days of the shares in Solv-Ex
Corporation previous to the Repayment Date, multiplied by 1,015,385 (the
result of the division of the aggregate Loan and the strike price of the
option on the Solv-Ex shares by Phemex Establishment of USD 32.50).
<PAGE>
5.2 The Borrower shall be obliged to repay the Loan in the respective amount
according to the financing mechanism described in Cif. 5.1, immediately
after Phemex has sold its shares in Solv-Ex Corporation and 72 hours
after Phemex has repaid the amount of the Financing Loan of Cif. 5.1.
6. EVENTS OF DEFAULT
Each of the following events shall be an Event of Default:
(i) any principal of, or interest on, the Loan or any other amount due
under this Agreement is not paid upon the due date for payment
thereof;
(ii) there is a material default on the part of the Borrower under any
of the provisions of this Agreement (other than (i) above which
(if in the sole opinion of the Lender it could be remedied) is not
remedied within 30 days after notice to the Borrower requesting
action to remedy such default;
(iii) any representation made by the Borrower in this Agreement or any
notice, certificate, or written statement delivered or made
pursuant hereto that proves to be misleading or materially
incorrect or inaccurate when made;
(iv) a distress or other execution is levied upon or against any
substantial part of the property of the Borrower and is not
discharged within 30 days, unless such distress or execution is
contested in good faith by the Borrower in appropriate proceedings
diligently pursued, which protect the Borrower's interest in such
property;
(v) an order of a competent court or an event analogous thereto has
been made or any effective resolution has been passed with a view
to the bankruptcy, composition agreement, liquidation or winding-
up of the Borrower;
(vi) the Borrower is unable or admits in writing his inability to pay
his lawful debts as they mature;
(vii) any license, consent, permission or approval required in
connection with the implementation, maintenance and performance of
this Agreement is revoked, terminated or modified in a manner
unacceptable to the Lender.
Upon the occurrence of any Event of Default referred to in this Clause 6 and
so long as such Event of Default continues, the Lender may accelerate the Loan
and the Lender shall forthwith notify the Borrower in writing that the entire
amount of the Loan outstanding together with all other amounts outstanding
under this Agreement shall become immediately due and payable.
7. FEES, COSTS AND EXPENSES
The Borrower shall pay the Lender, upon demand, all reasonable out-of-pocket
costs, charges, legal fees and expenses the Lender incurred in connection with
the enforcement and preservation of the Lender's rights under this Agreement
or otherwise in connection with the Loan.
8. PAYMENTS
8.1 All payments to be made by the Borrower under this Agreement shall be
made in USD to the Lender's bank account in immediately payable funds and
shall be made without setoff or counterclaim or any deductions for, and
fee and clear of, any taxes.
<PAGE>
8.2 In the event of any payments hereunder not being received on the due
date, interest will be charged by the Lender from the due date until the
date on which payment is received at a rate corresponding to the
aggregate amount of the interest rate.
9. NOTICES AND CORRESPONDENCE
9.1 Every notice or demand under this Agreement shall be in writing, but may
be given or made by telex or telefax, addressed to the Lender:
Waferprod Holding S.A.
c/o Citco, 5 Boulevard Royal
L-2449 Luxembourg
or such other address, telefax or telex number as may, from time to time,
the relevant party be notified. In the case of notices from the
Borrower, all telefax or telex messages shall be confirmed by letter
posted as soon as practicable thereafter, if so requested by the Lender.
9.2 Time is of essence to this Agreement but no failure or delay on the part
of the Lender to exercise any power or right under this Agreement shall
operate as a waiver thereof or the exercise of any other right nor shall
a waiver by the Lender on one occasion constitute a waiver by the Lender
on any other occasion. The remedies provided herein are cumulative and
are not exclusive of any remedies provided by law.
10. WRITTEN FORM
Any Changes or Alterations of this Agreement must be made in the written
form.
11. GOVERNING LAW AND JURISDICTION
11.1 GOVERNING LAW: This Agreement shall be governed and construed in
accordance with Swiss Law.
11.2 Forum of Jurisdiction shall be the Commercial Court of the Canton Zurich.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their authorised officers as of the day and year first above
written.
For and on behalf of For and on behalf of
Phemex Establishment Waferprod Holding S.A.
/s/Juerg Wyler /s/ Marco Wolf
(signature) (signature)
authorised officer authorised officer
<PAGE>
FINANCING LOAN FACILITY AGREEMENT
USD 18,150,000
ALULUX MINING S.A.
as Lender
and
WAFERPROD HOLDING S.A.
as Borrower
This Agreement is entered into on the 30th April 1996
BETWEEN
(1) Alulux Mining S.A., 5 Boulevard Royal, L-2449 Luxembourg
(the "Borrower")
and
(2) WAFERPROD HOLDING S.A., 5 Boulevard Royal, L-2449 Luxembourg
(the "Lender")
1. LOAN AND PURPOSE
WHEREAS, the Borrower is a holding company which holds various participations
related to the oil industry and other energy resources; and
WHEREAS, the Borrower requests to build up a portfolio, to increase its
participations and to generate a profit from acquiring and selling such
participations; and
WHEREAS, the Borrower intends to make a Financing Loan available to Phemex
Establishment at Altenbach 8,9490 Vaduz which is building up a substantial
participation in Solv-Ex Corp., a corporation quoted on the NASDAQ; and
WHEREAS, the Borrower has applied to the Lender for a Financing Loan on the
terms stated herein; and
WHEREAS, the Lender is willing to make such loans and financial accommodations
on the terms and subject to the conditions set forth hereinafter; and
NOW, THEREFORE, the Parties hereto have agreed as follows:
2. DEFINITIONS
In this Agreement the following terms and expressions shall have the following
meanings:
<PAGE>
"Agreement" shall mean this Agreement and shall include all amendments and
modifications.
"Banking Day" shall mean a day on which banks and foreign exchange markets are
open for business in such places contemplated for the transactions as required
by this Agreement.
"Drawdown Date" shall mean the date upon which the Commitment is made
available to the Borrower.
"Events of Default" shall mean the occurrence and continuance of any of the
events listed in Clause 6 of this Agreement.
"Financing Loan" shall mean the loans and other financial accommodations made
by the Lender under this Agreement in the aggregate amount of USD 18,150,000.
"GAAP" shall mean Generally Accepted Accounting Principles, consistently
applied.
"Interest" shall mean that the Lender shall receive a potential dividend paid
by Solv-Ex instead of interest.
"Lender's Fee" shall mean a one time fee in the amount of 5% of the Financing
Loan.
"Phemex" shall mean Phemex Establishment, 9490 Vaduz, an entity which will
conclude a Convertible Loan Agreement with Solv-Ex Corporation, which will
have the right to convert USD 33,000,000 into shares at a strike price of USD
32.50.
"Repayment" shall mean the Borrower shall be liable to repay the respective
amount reflecting the average listed price of the last five banking days of
the shares in Solv-Ex Corporation previous to the repayment date, multiplied
by 558,462 (the result of the division of the aggregate Loan and the strike
price of the option on the Solv-Ex shares by Phemex Establishment of USD
32.50). Repayment shall be replaced provided Phemex has converted its
Financing Loan into shares in order to receive 558,462 shares in Solv-Ex
during the period of this Financing Loan.
"Solv-Ex Corporation" shall mean a company incorporated in New Mexico with one
class of approximately 23,000,000 Common Shares outstanding quoted and
publicly traded on the NASDAQ Small Cap Market.
"Tax" shall mean all or any levies, imposts, duties, charges, fees, deductions
and withholdings levied or imposed by any national or governmental or public
body or authority with respect to the Loan.
"USD" shall mean the lawful currency of the United States.
Where the context of this Agreement so allows, words importing the singular
include the plural and vice versa.
3. THE FINANCING LOAN
The Lender agrees, on the terms and conditions set forth hereinafter, to
lend the Borrower, on his request, a sum of USD 18,150,000. After the
deduction of the Lender's Fee of USD 907,500 as specified in Cif. 4.1,
the Borrower shall receive a payment of USD 17,242,500.
4. LENDER'S COMPENSATION
4.1 The Borrower undertakes to pay a Lender's Fee of 5% of the Financing Loan
in the amount of USD 907,500 to the Lender, payable in advance and
consents that the Lender shall deduct USD 907,500 from the Principal.
<PAGE>
4.2 Interest payments shall be remitted in the respective amount reflecting
the dividend of Solv-Ex Corporation to its shareholders.
5. REPAYMENT
5.1 The Loan shall be repaid in the respective amount reflecting the average
listed price of the last five banking days of the shares in Solv-Ex
Corporation previous to the Repayment Date, multiplied by 558,462 (the
result of the division of the aggregate Loan and the strike price of the
option on the Solv-Ex shares by Phemex Establishment of USD 32.50).
5.2 The Borrower shall be obliged to repay the Loan in the respective amount
according to the financing mechanism described in Cif. 5.1, immediately
after Phemex has sold its shares in Solv-Ex Corporation and 72 hours
after Phemex has repaid the amount of the Financing Loan of Cif. 5.1.
6. EVENTS OF DEFAULT
Each of the following events shall be an Event of Default:
(i) any principal of, or interest on, the Loan or any other amount due
under this Agreement is not paid upon the due date for payment
thereof;
(ii) there is a material default on the part of the Borrower under any
of the provisions of this Agreement (other than (i) above which
(if in the sole opinion of the Lender it could be remedied) is not
remedied within 30 days after notice to the Borrower requesting
action to remedy such default;
(iii) any representation made by the Borrower in this Agreement or any
notice, certificate, or written statement delivered or made
pursuant hereto that proves to be misleading or materially
incorrect or inaccurate when made;
(iv) a distress or other execution is levied upon or against any
substantial part of the property of the Borrower and is not
discharged within 30 days, unless such distress or execution is
contested in good faith by the Borrower in appropriate proceedings
diligently pursued, which protect the Borrower's interest in such
property;
(v) an order of a competent court or an event analogous thereto has
been made or any effective resolution has been passed with a view
to the bankruptcy, composition agreement, liquidation or winding-
up of the Borrower;
(vi) the Borrower is unable or admits in writing his inability to pay
his lawful debts as they mature;
(vii) any license, consent, permission or approval required in
connection with the implementation, maintenance and performance of
this Agreement is revoked, terminated or modified in a manner
unacceptable to the Lender.
Upon the occurrence of any Event of Default referred to in this Clause 6 and
so long as such Event of Default continues, the Lender may accelerate the Loan
and the Lender shall forthwith notify the Borrower in writing that the entire
amount of the Loan outstanding together with all other amounts outstanding
under this Agreement shall become immediately due and payable.
7. FEES, COSTS AND EXPENSES
<PAGE>
The Borrower shall pay the Lender, upon demand, all reasonable out-of-pocket
costs, charges, legal fees and expenses the Lender incurred in connection with
the enforcement and preservation of the Lender's rights under this Agreement
or otherwise in connection with the Loan.
8. PAYMENTS
8.1 All payments to be made by the Borrower under this Agreement shall be
made in USD to the Lender's bank account in immediately payable funds and
shall be made without setoff or counterclaim or any deductions for, and
free and clear of, any taxes.
8.2 In the event of any payments hereunder not being received on the due
date, interest will be charged by the Lender from the due date until the
date on which payment is received at a rate corresponding to the
aggregate amount of the interest rate.
9. NOTICES AND CORRESPONDENCE
9.1 Every notice or demand under this Agreement shall be in writing, but may
be given or made by telex or telefax, addressed to the Lender:
Alulux Mining S.A.
c/o Citco, 5 Boulevard Royal
L-2449 Luxembourg
or such other address, telefax or telex number as may, from time to time,
the relevant party be notified. In the case of notices from the
Borrower, all telefax or telex messages shall be confirmed by letter
posted as soon as practicable thereafter, if so requested by the Lender.
9.2 Time is of essence to this Agreement but no failure or delay on the
part of the Lender to exercise any power or right under this
Agreement shall operate as a waiver thereof or the exercise of any
other right nor shall a waiver by the Lender on one occasion
constitute a waiver by the Lender on any other occasion. The
remedies provided herein are cumulative and are not exclusive of any
remedies provided by law.
10. WRITTEN FORM
Any Changes or Alterations of this Agreement must be made in the written
form.
11. GOVERNING LAW AND JURISDICTION
11.1 GOVERNING LAW: This Agreement shall be governed and construed in
accordance with Swiss Law.
11.2 Forum of Jurisdiction shall be the Commercial Court of the Canton Zurich.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their authorised officers as of the day and year first above
written.
For and on behalf of For and on behalf of
Alulux Mining S.A. Waferprod Holding S.A.
<PAGE>
/s/ Marco Wolf /s/ Juerg Wyler
(signature) (signature)
authorised officer authorised officer
<PAGE>
FINANCING LOAN FACILITY AGREEMENT
USD 14,850,000
Sandvest Petroleum S.A.
as Lender
and
WAFERPROD HOLDING S.A.
as Borrower
This Agreement is entered into on April 30, 1996
BETWEEN
(1) Sandvest Petroleum S.A., 5 Boulevard Royal, L-2449 Luxembourg
(the "Lender")
and
(2) WAFERPROD HOLDING S.A., 5 Boulevard Royal, L-2449 Luxembourg
(the "Borrower")
1. LOAN AND PURPOSE
WHEREAS, the Borrower is a holding company which holds various participations
related to the oil industry and other energy resources; and
WHEREAS, the Borrower requests to build up a portfolio, to increase its
participations and to generate a profit from acquiring and selling such
participations; and
WHEREAS, the Borrower intends to make a Financing Loan available to Phemex
Establishment at Altenbach 8,9490 Vaduz who is building up a substantial
participation in Solv-Ex Corp., a corporation quoted on the NASDAQ; and
WHEREAS, the Borrower has applied to the Lender for a Financing Loan on the
terms stated herein; and
WHEREAS, the Lender is willing to make such loans and financial accommodations
on the terms and subject to the conditions set forth hereinafter; and
NOW, THEREFORE, the Parties hereto have agreed as follows:
2. DEFINITIONS
In this Agreement the following terms and expressions shall have the following
meanings:
"Agreement" shall mean this Agreement and shall include all amendments and
modifications.
<PAGE>
"Banking Day" shall mean a day on which banks and foreign exchange markets are
open for business in such places contemplated for the transactions as required
by this Agreement.
"Drawdown Date" shall mean the date upon which the Commitment is made
available to the Borrower.
"Events of Default" shall mean the occurrence and continuance of any of the
events listed in Clause 6 of this Agreement.
"Financing Loan" shall mean the loans and other financial accommodations made
by the Lender under this Agreement in the aggregate amount of USD 14,850,000.
"Lender's Fee" shall mean a one time in the amount of 5% of the Financial
Loan.
"GAAP" shall mean Generally Accepted Accounting Principles, consistently
applied.
"Interest" shall mean that the Lender shall receive a potential dividend paid
by Solv-Ex instead of interest.
"Phemex" shall mean Phemex Establishment, 9490 Vaduz, an entity which will
conclude a Convertible Loan Agreement with Solv-Ex Corporation which will have
the right to convert USD 33,000,000 into shares at a strike price of USD
32.50.
"Solv-Ex Corporation" shall mean a company incorporated in New Mexico with one
class of approximately 23,000,000 Common Shares outstanding quoted and
publicly traded on the NASDAQ Small Cap Market.
"Repayment" shall mean the Borrower shall be liable to repay the respective
amount reflecting the average listed price of the last five banking days of
the shares in Solv-Ex Corporation previous to the repayment date, multiplied
by 456,923 (the result of the division of the aggregate Loan and the strike
price of the option on the Solv-Ex shares by Phemex Establishment of USD
32.50). Repayment shall be replaced provided Phemex shall have converted its
Financing Loan into shares in order to receive 456,923 shares in Solv-Ex.
"Tax" shall mean all or any levies, imposts, duties, charges, fees, deductions
and withholdings levied or imposed by any national or governmental or public
body or authority with respect to the Loan.
"USD" shall mean the lawful currency of the United States.
Where the context of this Agreement so allows, words importing the singular
include the plural and vice versa.
3. THE FINANCING LOAN
The Lender agrees, on the terms and conditions set forth hereinafter, to
lend the Borrower, on his request, a sum of USD 14,850,000. After the
deduction of the Lender's Fee of USD 742,500 as specified in Cif. 4.1 of
this Agreement, the Borrower shall receive a payment of USD.
4. LENDER'S COMPENSATION
4.1 The Borrower undertakes to pay a Lender's Fee of 5% of the Financing Loan
in the amount of USD 742,500 to the Lender payable in advance and
consents that the Lender shall deduct USD 742,500 from the Principal.
4.2 Interest payments shall be remitted in the respective amount reflecting
the dividend of Solv-Ex Corporation to its shareholders.
<PAGE>
5. REPAYMENT
5.1 The Loan shall be repaid in the respective amount reflecting the average
listed price of the last five banking days of the shares in Solv-Ex
Corporation previous to the Repayment Date, multiplied by 456,923 (the
result of the division of the aggregate Loan and the strike price of the
option on the Solv-Ex shares by Phemex Establishment of USD 32.50).
5.2 The Borrower shall be obliged to repay the Loan in the respective amount
according to the financing mechanism described in Cif. 5.1, immediately
after Phemex has sold its shares in Solv-Ex Corporation and 72 hours
after Phemex has repaid the amount of the Financing Loan of Cif. 5.1.
6. EVENTS OF DEFAULT
Each of the following events shall be an Event of Default:
(i) any principal of, or interest on, the Loan or any other amount due
under this Agreement is not paid upon the due date for payment
thereof;
(ii) there is a material default on the part of the Borrower under any
of the provisions of this Agreement (other than (i) above which
(if in the sole opinion of the Lender it could be remedied) is not
remedied within 30 days after notice to the Borrower requesting
action to remedy such default;
(iii) any representation made by the Borrower in this Agreement or any
notice, certificate, or written statement delivered or made
pursuant hereto that proves to be misleading or materially
incorrect or inaccurate when made;
(iv) a distress or other execution is levied upon or against any
substantial part of the property of the Borrower and is not
discharged within 30 days, unless such distress or execution is
contested in good faith by the Borrower in appropriate proceedings
diligently pursued, which protect the Borrower's interest in such
property;
(v) an order of a competent court or an event analogous thereto has
been made or any effective resolution has been passed with a view
to the bankruptcy, composition agreement, liquidation or winding-
up of the Borrower;
(vi) the Borrower is unable or admits in writing his inability to pay
his lawful debts as they mature;
(vii) any license, consent, permission or approval required in
connection with the implementation, maintenance and performance of
this Agreement is revoked, terminated or modified in a manner
unacceptable to the Lender.
Upon the occurrence of any Event of Default referred to in this Clause 6 and
so long as such Event of Default continues, the Lender may accelerate the Loan
and the Lender shall forthwith notify the Borrower in writing that the entire
amount of the Loan outstanding together with all other amounts outstanding
under this Agreement shall become immediately due and payable.
7. FEES, COSTS AND EXPENSES
The Borrower shall pay the Lender upon demand all reasonable out-of-pocket
costs, charges, legal fees and expenses the Lender incurred in connection with
the enforcement and preservation of the Lender's rights under this Agreement
or otherwise in connection with the Loan.
<PAGE>
8. PAYMENTS
8.1 All payments to be made by the Borrower under this Agreement shall be
made in USD to the Lender's bank account in immediately payable funds and
shall be made without setoff or counterclaim or any deductions for, and
fee and clear of, taxes.
8.2 In the event of any payments hereunder not being received on the due
date, interest will be charged by the Lender from the due date until the
date on which payment is received at a rate corresponding to the
aggregate amount of the interest rate.
9. NOTICES AND CORRESPONDENCE
9.1 Every notice or demand under this Agreement shall be in writing, but may
be given or made by telex or telefax, addressed to the Lender:
Sandvest Petroleum S.A.
c/o Citco, 5 Boulevard Royal
L-2449 Luxembourg
or such other address, telefax or telex number as may, from time to time,
be notified by the relevant party. In the case of notices from the
Borrower, all telefax or telex messages shall be confirmed by letter
posted as soon as practicable thereafter, if so requested by the Lender.
9.2 Time is of essence to this Agreement but no failure or delay on the part
of the Lender to exercise any power or right under this Agreement shall
operate as a waiver thereof or the exercise of any other right nor shall
a waiver by the Lender on one occasion constitute a waiver by the Lender
on any other occasion. The remedies provided herein are cumulative and
are not exclusive of any remedies provided by law.
10. WRITTEN FORM
Any Changes or Alterations of this Agreement must be made in the written
form.
11. GOVERNING LAW AND JURISDICTION
11.1 GOVERNING LAW: This Agreement shall be governed and construed in
accordance with Swiss Law.
11.2 Forum of Jurisdiction shall be the Commercial Court of the Canton Zurich.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their authorised officers as of the day and year first above
written.
For and on behalf of For and on behalf of
Sandvest Petroleum S.A. Waferprod Holding S.A.
/s/ Marco Wolf /s/ Juerg Wyler
(signature) (signature)
authorised officer authorised officer
<PAGE>
FINANCING LOAN FACILITY AGREEMENT
USD 4,888,260
ALULUX MINING S.A.
AS LENDER
and
SILVA INVESTMENTS LTD.
AS BORROWER
INDEX
<TABLE>
Clause number Subject matter Page number
<S> <C> <C>
1 LOAN AND PURPOSE 3
2 DEFINITIONS 4
3 THE FINANCING LOAN 5
4 REPAYMENT 5
5 EVENTS OF DEFAULT 5
6 FEES, COSTS AND EXPENSES 6
7 PAYMENTS 6
8 NOTICES AND CORRESPONDENCE 6
9 WRITTEN FORM 7
10 GOVERNING LAW AND JURISDICTION 7
</TABLE>
This Agreement is entered into on the 30th April 1996
BETWEEN
(1) Alulux Mining S.A., 5 Boulevard Royal, L-2449 Luxembourg
(the "Lender")
and
(2) Silva Investments Ltd., Westwind Building, P.O. Box 111,
Grand Cayman, Cayman Island
(the "Borrower")
1. LOAN AND PURPOSE
WHEREAS, the Borrower is a holding company which holds various participations
related to the oil industry and other energy resources; and
<PAGE>
WHEREAS, the Borrower requests to build up a portfolio, to increase its
participations and to generate a profit from acquiring and selling such
participations and intends to purchase 300,000 shares in Solv-Ex Corp., a
corporation quoted on the NASDAQ; and
WHEREAS, the Borrower has applied to the Lender for a Financing Loan on the
terms stated herein; and
WHEREAS, the Lender is willing to make such loans and financial accommodations
on the terms and subject to the conditions set forth hereinafter; and
NOW, THEREFORE, the Parties hereto have agreed as follows:
2. DEFINITIONS
In this Agreement the following terms and expressions shall have the following
meanings:
"AGREEMENT" shall mean this Agreement and shall include all amendments and
modifications.
"BANKING DAY" shall mean a day upon which banks and foreign exchange markets
are open for business in such places contemplated for the transactions as
required by this Agreement.
"DRAWDOWN DATE" shall mean the date upon which the Commitment is made
available to the Borrower.
"EVENTS OF DEFAULT" shall mean the occurrence and continuance of any of the
events listed in Clause 5 of this Agreement.
"FINANCING LOAN" shall mean the loans and other financial accommodations made
by the Lender under this Agreement in the aggregate amount of USD 4,888,260.
"GAAP" shall mean Generally Accepted Accounting Principles, consistently
applied.
"INTEREST" shall mean that the Lender shall receive a potential dividend paid
by Solv-Ex instead of interest.
"REPAYMENT" shall mean the Borrower shall be liable to repay the respective
amount reflecting the average listed price of the last five banking days of
the shares in Solv-Ex previous to the repayment date, multiplied by 300,000.
(reflecting the result of the division of the aggregate Loan of USD 4,888,260
- -- and the strike price of the option on the Solv-Ex shares granted to Phemex
Establishment of USD 32.50).
"SOLV-EX CORPORATION" shall mean a company incorporated in New Mexico with one
class of approximately 23,000,000 Common Shares outstanding quoted and
publicly traded on the NASDAQ Small Cap Market.
"TAX" shall mean all or any levies, imposts, duties, charges, fees, deductions
and withholdings levied or imposed by any national or local governmental or
public body or authority with respect to the Loan.
"USD" shall mean the lawful currency of the United States.
Where the context of this Agreement so allows, words importing the singular
include the plural and vice versa.
3. THE FINANCING LOAN
The Lender agrees, on the terms and conditions set forth hereinafter, to lend
to the Borrower, on his request, a sum of USD 4,888,260.
4. REPAYMENT
<PAGE>
4.1 The Borrower shall be entitled to prepay the Loan at any time. If the
Borrower requests to do so, he shall inform the Lender by remitting a
written notice when such repayment shall be effectuated.
4.2 The Loan shall be repaid in the respective amount reflecting the average
listed price of the last five banking days of the shares in Solv-Ex
previous to the repayment date, multiplied by 300,000.
5. EVENTS OF DEFAULT
Each of the following events shall be an Event of Default:
(i) any principal of, or interest on, the Loan or any other amount due
under this Agreement is not paid upon the due date for payment
thereof;
(ii) there is a material default on the part of the Borrower under any of
the provisions of this Agreement (other than (i) above which (if in
the sole opinion of the Lender it could be remedied) is not remedied
within 30 days after notice to the Borrower requesting action to
remedy such default;
(iii) any representation made by the Borrower in this Agreement or any
notice, certificate or written statement delivered or made pursuant
hereto proves to be misleading or materially incorrect or inaccurate
when made;
(iv) a distress or other execution is levied upon or against any
substantial part of the property of the Borrower and is not
discharged within 30 days, unless such distress or execution is
contested in good faith by the Borrower in appropriate proceedings
diligently pursued, which protect the Borrower's interest in such
property;
(v) an order of a competent court or an event analogous thereto has been
made or any effective resolution has been passed with a view to the
bankruptcy proceedings, composition agreement, liquidation or
winding-up of the Borrower;
(vi) the Borrower is unable or admits in writing his inability to pay his
lawful debts as they mature;
(vii) any license, consent, permission or approval required in connection
with the implementation, maintenance and performance of its
Agreement is revoked, terminated or modified in a manner
unacceptable to the Lender.
Upon the occurrence of any Event of Default referred to in this Clause 5 and
so long as such Event of Default continues, the Lender may accelerate the Loan
and the Lender shall forthwith notify the Borrower in writing that the entire
amount of the Loan outstanding, together with all other amounts outstanding
under this Agreement, shall become immediately due and payable.
6. FEES, COSTS AND EXPENSES
The Borrower shall pay the Lender, upon demand, all reasonable out-of-pocket
costs, charges, legal fees and expenses the Lender incurred in connection with
the enforcement and preservation of the Lender's rights under this Agreement
or otherwise in connection with the Loan.
7. PAYMENTS
7.1 All payments to be made by the Borrower under this Agreement shall be
made in USD to the Lender's bank account in immediately payable funds and
shall be made without set-off or counterclaim or any deductions for, and
free and clear of, any taxes.
<PAGE>
7.2 In the event of any payments hereunder not being received on the due
date, interest will be charged by the Lender from the due date until the
date on which payment is received at a rate corresponding to the
aggregate amount of the interest rate.
8. NOTICES AND CORRESPONDENCE
8.1 Every notice or demand under this Agreement shall be in writing, but may
be given or made by telex or telefax, addressed to the Lender:
Alulux Mining S.A.
c/o Citco, 5 Boulevard Royal
L-2449 Luxembourg
or such other address, telefax or telex number as may, from time to time,
be notified by the relevant party. In the case of notices from the
Borrower, all telefax or telex messages shall be confirmed by letter
posted as soon as practicable thereafter, if so requested by the Lender.
8.2 Time is of essence to this Agreement but no failure or delay on the part
of the Lender to exercise any power or right under this Agreement shall
operate as a waiver thereof or the exercise of any other right nor shall
a waiver by the Lender on one occasion constitute a waiver by the Lender
on any other occasion. The remedies provided herein are cumulative, and
are not exclusive of any remedies provided by law.
9. WRITTEN FORM
Any Changes or Alterations of this Agreement must be made in the written form.
10. GOVERNING LAW AND JURISDICTION
10.1 GOVERNING LAW: This Agreement shall be governed and construed in
accordance with Swiss Law.
10.2 Forum of Jurisdiction shall be the Commercial Court of the Canton Zurich.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their authorised officers as of the day and year first above
written.
For and on behalf of For and on behalf of
Silva Investments Ltd. Alulux Mining S.A.
[signature illegible] /s/ Marco Wolf
(Signature) (Signature)
authorised officer authorised officer
<PAGE>
FINANCING LOAN FACILITY AGREEMENT
USD 7,332,390
SANDVEST PETROLEUM S.A.
AS LENDER
AND
SILVA INVESTMENTS LTD.
AS BORROWER
INDEX
<TABLE>
Clause number Subject matter Page number
<S> <C> <C>
1 LOAN AND PURPOSE 3
2 DEFINITIONS 4
3 THE FINANCING LOAN 5
4 REPAYMENT 5
5 EVENTS OF DEFAULT 5
6 FEES, COSTS AND EXPENSES 6
7 PAYMENTS 6
8 NOTICES AND CORRESPONDENCE 7
9 WRITTEN FORM 7
10 GOVERNING LAW AND JURISDICTION 7
</TABLE>
This Agreement is entered into on the 30th April 1996
BETWEEN
(1) Sandvest Petroleum S.A., 5 Boulevard Royal, L-2449 Luxembourg
(the "Lender")
and
(2) Silva Investments Ltd., Westwind Building, P.O. Box 111,
Grand Cayman, Cayman Island
(the "Borrower")
1. LOAN AND PURPOSE
WHEREAS, the Borrower is a holding company which holds various participations
related to the oil industry and other energy resources; and
WHEREAS, the Borrower requests to build up a portfolio, to increase its
participations and to generate a profit from acquiring and selling such
<PAGE>
participations and intends to purchase 450,000 shares in Solv-Ex Corp., a
corporation quoted on the NASDAQ; and
WHEREAS, the Borrower has applied to the Lender for a Financing Loan on the
terms stated herein; and
WHEREAS, the Lender is willing to make such loans and financial accommodations
on the terms and subject to the conditions set forth hereinafter; and
NOW, THEREFORE, the Parties hereto have agreed as follows:
2. DEFINITIONS
In this Agreement the following terms and expressions shall have the following
meanings:
"AGREEMENT" shall mean this Agreement and shall include all amendments and
modifications.
"BANKING DAY" shall mean a day upon which banks and foreign exchange markets
are open for business in such places contemplated for the transactions as
required by this Agreement.
"DRAWDOWN DATE" shall mean the date upon which the Commitment is made
available to the Borrower.
"EVENTS OF DEFAULT" shall mean the occurrence and continuance of any of the
events listed in Clause 5 of this Agreement.
"FINANCING LOAN" shall mean the loans and other financial accommodations made
by the Lender under this Agreement in the aggregate amount of USD 4,888,260.
"GAAP" shall mean Generally Accepted Accounting Principles, consistently
applied.
"INTEREST" shall mean that the Lender shall receive a potential dividend paid
by Solv-Ex instead of interest.
"REPAYMENT" shall mean the Borrower shall be liable to repay the respective
amount reflecting the average listed price of the last five banking days of
the shares in Solv-Ex previous to the repayment date, multiplied by 450,000.
"SOLV-EX CORPORATION" shall mean a company incorporated in New Mexico with one
class of approximately 23,000,000 Common Shares outstanding quoted and
publicly traded on the NASDAQ Small Cap Market.
"TAX" shall mean all or any levies, imposts, duties, charges, fees, deductions
and withholdings levied or imposed by any national or local governmental or
public body or authority with respect to the Loan.
"USD" shall mean the lawful currency of the United States.
Where the context of this Agreement so allows, words importing the singular
include the plural and vice versa.
3. THE FINANCING LOAN
The Lender agrees, on the terms and conditions hereinafter set forth, to lend
to the Borrower, on his request, a sum of USD 7,332,390.
4. REPAYMENT
4.1 The Loan shall be repaid in the respective amount reflecting the average
list share price of the last five banking days of the shares in Solv-Ex
previous to the repayment date, multiplied by 450,000.
<PAGE>
4.2 The Borrower shall be obliged to repay the Loan in the respective amount
according to the financing mechanism described in Cit. 4.1. immediately
after the Borrower has sold his shares in Solv-Ex Corporation.
5. EVENTS OF DEFAULT
Each of the following events shall be an Event of Default:
(i) any principal of, or interest on, the Loan or any other amount due
under this Agreement is not paid upon the due date for payment
thereof;
(ii) there is a material default on the part of the Borrower under any of
the provisions of this Agreement (other than (i) above which (if in
the sole opinion of the Lender it could be remedied) is not remedied
within 30 days after notice to the Borrower requesting action to
remedy such default;
(iii) any representation made by the Borrower in this Agreement or any
notice, certificate, or written statement delivered or made pursuant
hereto proves to be misleading or materially incorrect or inaccurate
when made;
(iv) a distress or other execution is levied upon or against any
substantial part of the property of the Borrower and is not
discharged within 30 days, unless such distress or execution is
contested in good faith by the Borrower in appropriate proceedings
diligently pursued, which protect the Borrower's interest in such
property;
(v) an order of a competent court or an event analogous thereto has been
made or any effective resolution has been passed with a view to the
bankruptcy, composition agreement, liquidation or winding-up of the
Borrower;
(vi) the Borrower is unable or admits in writing his inability to pay his
lawful debts as they mature;
(vii) any license, consent, permission or approval required in connection
with the implementation, maintenance and performance of this
Agreement is revoked, terminated or modified in a manner
unacceptable to the Lender.
Upon the occurrence of any Event of Default referred to in this Clause 5 and
so long as such Event of Default continues, the Lender may accelerate the Loan
and the Lender shall forthwith notify the Borrower in writing that the entire
amount of the Loan outstanding, together with all other amounts outstanding
under this Agreement, shall become immediately due and payable.
6. FEES, COSTS AND EXPENSES
The Borrower shall pay the Lender, upon demand, all reasonable out-of-pocket
costs, charges, legal fees and expenses the Lender incurred in connection with
the enforcement and preservation of the Lender's rights under this Agreement
or otherwise in connection with the Loan.
7. PAYMENTS
7.1 All payments to be made by the Borrower under this Agreement shall be
made in USD to the Lender's bank account in immediately payable funds and
shall be made without setoff or counterclaim or any deductions for, and
free and clear of, any taxes.
7.2 In the event of any payments hereunder not being received on the due
date, interest will be charged by the Lender from the due date until the
<PAGE>
date on which payment is received at a rate corresponding to the
aggregate amount of the interest rate.
8. NOTICES AND CORRESPONDENCE
8.1 Every notice or demand under this Agreement shall be in writing, but may
be given or made by telex or telefax, addressed to the Lender:
Sandvest Petroleum S.A.
c/o Citco, 5 Boulevard Royal
L-2449 Luxembourg
or such other address, telefax or telex number as may, from time to time,
be notified by the relevant party. In the case of notices from the
Borrower, all telefax or telex messages shall be confirmed by letter
posted as soon as practicable thereafter, if so requested by the Lender.
8.2 Time is of essence to this Agreement but no failure or delay on the part
of the Lender to exercise any power or right under this Agreement shall
operate as a waiver thereof or the exercise of any other right nor shall
a waiver by the Lender on one occasion constitute a waiver by the Lender
on any other occasion. The remedies provided herein are cumulative and
are not exclusive of any remedies provided by law.
9. WRITTEN FORM
Any Changes or Alterations of this Agreement must be made in the written form.
10. GOVERNING LAW AND JURISDICTION
10.1 GOVERNING LAW: This Agreement shall be governed and construed in
accordance with Swiss Law.
10.2 Forum of Jurisdiction shall be the Commercial Court of the Canton Zurich.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their authorised officers as of the day and year first above
written.
For and on behalf of For and on behalf of
Silva Investments Ltd. Sandvest Petroleum S.A.
[signature illegible] /s/ Marco Wolf
(Signature) (Signature)
authorised officer authorised officer
<PAGE>
This Agreement is entered into on the 16th of June 1996
BETWEEN
(1) Sandvest Petroleum S.A., 5 Boulevard Royal, L-2449 Luxembourg
(the "Lender")
and
(2) RussOil & Technology S.A., 5 Boulevard Royal, L-2449 Luxembourg
(The "Borrower")
1. LOAN AND PURPOSE
WHEREAS, the Borrower is a holding company which holds various
participations related to the oil industry and other energy resources; and
WHEREAS, the Borrower requests to build up a portfolio, to increase
its participations and to generate a profit from acquiring and selling such
participations and intends to purchase 356,453 shares in Solv-Ex Corp., a
corporation quoted on the NASDAQ; and
WHEREAS, the Borrower has applied to the Lender for a Financing Loan
on the terms stated herein; and
WHEREAS, the Lender is willing to make such loans and financial
accommodations on the terms and subject to the conditions set forth
hereinafter; and
NOW, THEREFORE, the Parties hereto have agreed as follows:
2. DEFINITIONS
In this Agreement the following terms and expressions shall have the
following meanings:
"Agreement" shall mean this Agreement and shall include all
amendments and modifications.
"Banking Day" shall mean a day upon which banks and foreign exchange
markets are open for business in such places contemplated for the transactions
as required by this Agreement.
"Drawdown Date" shall mean the date upon which the Commitment is
made available to the Borrower.
"Events of Default" shall mean the occurrence and continuance of any
of the events listed in clause 5 of this Agreement.
"Financing Loan" shall mean the loans and other financial
accommodations made by the Lender under this Agreement in the aggregate amount
of USD 5,754,933.
"GAAP" shall mean Generally Accepted Accounting Principles,
consistently applied.
<PAGE>
"Interest" shall mean that the Lender shall receive a potential
dividend paid by Solv-Ex instead of Interest.
"Solv-Ex Corporation" shall mean a company incorporated in New
Mexico with one class of approximately 23,000,000 Common Shares outstanding
quoted and publicly traded on the NASDAQ Small Cap Market.
"Repayment" shall mean the Borrower shall be liable to repay the
respective amount reflecting the average listed price of the last five banking
days of the shares in Solv-Ex previous to the repayment date, multiplied by
356,453.
"Tax" shall mean all or any levies, imposts, duties, charges, fees,
deductions and withholdings levied or imposed by any national or local
governmental or public body or authority with respect to the Loan.
"USD" shall mean the lawful currency of the United States.
Where the context of this Agreement so allows, words importing the
singular include the plural and vice versa.
3. THE FINANCING LOAN
The Lender agrees, on the terms and conditions set forth
hereinafter, to lend the Borrower, on his request, a sum of USD 4,888,260.
4. REPAYMENT
4.1. The Loan shall be repaid in the respective amount reflecting
the average list share price of the last five banking days of the shares in
Solv-Ex. previous to the repayment date, multiplied by 356,483.
4.2. The Borrower shall be obliged to repay the Loan in the
respective amount according to the financing mechanism described in Clf. 4.1,
immediately after the Borrower has sold his shares in Solv-Ex Corporation.
5. EVENTS OF DEFAULT
Each of the following events shall be an Event of Default:
(i) any principal of, or interest on, the Loan or any other amount
due under this Agreement is not paid upon the due date for payment thereof;
(ii) there is a material default on the part of the Borrower under
any of the provisions of this Agreement (other than (i) above which (if in the
sole opinion of the Lender it could be remedied) is not remedied within 30
days after notice to the Borrower requesting action to remedy such default:
(iii) any representation made by the Borrower in this Agreement
or any notice, certificate, or written statement delivered or made pursuant
hereto proves to be misleading or materially incorrect or inaccurate when
made;
(iv) a distress or other execution is levied upon or against any
substantial part of the property of the Borrower and is not discharged within
30 days, unless such distress or execution is contested in good faith by the
Borrower in appropriate proceedings diligently pursued, which protect the
Borrower's interest in such property;
(v) an order of a competent court or an event analogous thereto has
been made or any effective resolution has been passed with a view to the
bankruptcy, composition agreement, liquidation or winding-up of the Borrower;
(vi) the Borrower is unable or admits in writing his inability to
pay his lawful debts as they mature;
<PAGE>
(vii) any license, consent, permission or approval required in
connection with the implementation, maintenance and performance of this
Agreement is revoked, terminated or modified in a manner unacceptable to the
Lender.
Upon the occurrence of any Event of Default referred to in this
Clause 7 and so long as such Event of Default continues, the Lender may
accelerate the Loan and the Lender shall forthwith notify the Borrower in
writing that the entire amount of the Loan outstanding together with all other
amounts outstanding under this Agreement shall become immediately due and
payable.
6. FEES, COSTS AND EXPENSES
The Borrower shall pay the Lender, upon demand, all reasonable out-
of-pocket costs, charges, legal fees and expenses the Lender incurred in
connection with the enforcement and preservation of the Lender's rights under
this Agreement or otherwise in connection with the Loan.
7. PAYMENTS
7.1. All payments to be made by the Borrower under this Agreement
shall be made in USD to the Lender's bank account in immediately payable funds
and shall be made without setoff or counterclaim or any deductions for, and
free and clear of, any taxes.
7.2. In the event of any payments hereunder not being received on
the due date, interest will be charged by the Lender from the due date until
the date on which payment is received at a rate corresponding to the aggregate
amount of the interest rate
8 NOTICES AND CORRESPONDENCE
8.1. Every notice or demand under this Agreement shall be in
writing, but may be given or made by telex or telefax, addressed to the
Lender:
Sandvest Petroleum S.A.
c/o Citco, 5 Boulevard Royal
L-2449 Luxembourg
or such other address, telefax or telex number as may, from time to time, be
notified by the relevant party. In the case of notices from the Borrower, all
telefax or telex messages shall be confirmed by letter posted as soon as
practicable thereafter, it so requested by the Lender.
8.2. Time is of essence to this Agreement but no failure or delay on
the part of the Lender to exercise any power or right under this Agreement
shall operate as a waiver thereof or the exercise of any other right nor shall
a waiver by the Lender on one occasion constitute a waiver by the Lender on
any other occasion. The remedies provided herein are cumulative and are not
exclusive of any remedies provided by law.
9. Written Form
Any Changes or Alterations of this Agreement must be made in the
written form.
10. GOVERNING LAW AND JURISDICTION
10.1. GOVERNING LAW: This Agreement shall be governed and
construed in accordance with Swiss Law.
10.2. Forum of Jurisdiction shall be the Commercial Court of the
Canton Zurich.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their authorized officers as of the day and year first
above written.
For and on behalf of For and on behalf of
Russ Oil & Technology S.A Sandvest Petroleum S.A.
/s/ Juerg Wyler /s/ Marco Wolf
(signature) (signature)
authorized officer authorized officer
<PAGE>
AGREEMENT
between
Morgan Grenfell, 20 Finsbury Circus, London EC2M 1 NB,
(hereinafter called "the Principal")
and
Marco Wolf, Baldernstrasse 18, 8134 Adliswil,
Juerg Wyler, Schwoesterrain, 8714 Feldbach,
(hereinafter called "W&W")
Alulux Mining S.A., 5 Boulevard Royal, L-2449 Luxembourg,
with a share capital of DEM 282,600.--,
(hereinafter called "the Company")
1. The Principal hereby instructs W&W to perform or cause third parties to
perform the following:
( ) to incorporate the Company
( ) to represent the Principal at the shareholders' meeting of the
Company
( ) to join the board of directors of the Company
( ) to act as lawyers on behalf of the company and to watch the
structure
2. W&W shall only act within the bounds of law and ethics according to the
instructions of the Principal. In the absence of such instructions, W&W
may act on its own initiative.
3. The Principal may appoint one or more representatives to act on their
behalf. Their proxies may be revoked at any time. If more than one
person is entitled to give instructions as Principal or representative,
W&W may follow the instructions of any one of them without previously
contacting the other persons so entitled.
4. The Principal undertakes to put the necessary qualifying shares at the
disposal of W&W. Monies received in respect of such shares belong to the
Principal.
5. The Principal and his successors/assignees undertake to release,
discharge and indemnify W&W for all claims brought against them in
connection with the performance of this Agreement, especially in their
capacity as founder, shareholder, member of the board of directors or
administrator. W&W is only liable for unlawful intent and gross
negligence.
6. The Principal will reimburse W&W all expenditures, fees, taxes and any
other costs incurred in connection with this Agreement and in the
interest of the Principal. Besides, W&W is authorized to charge its
<PAGE>
usual fees. For the activity as directors, W&W shall receive CHF 6,000.-
per director per annum.
7. This Agreement may be terminated by either party at any time. It is,
however, not automatically terminated in the case of loss of capacity to
act or bankruptcy of either party.
8. This Agreement is subject to Swiss law. Any dispute arising out of this
Agreement is herewith subjected to the jurisdiction of the ordinary
courts at Zurich.
Zurich,
The Principal: W&W:
/s/ Peter Young /s/ Juerg Wyler /s/ Marco Wolf
for and on behalf of Juerg Wyler Marco Wolf
Morgan Grenfell
<PAGE>
AGREEMENT
between
Morgan Grenfell, 20 Finsbury Circus, London EC2M 1 NB,
(hereinafter called "the Principal")
and
Marco Wolf, Baldernstrasse 18, 8134 Adliswil,
Juerg Wyler, Schwoesterrain, 8714 Feldbach,
(hereinafter called "W&W")
Sandvest Petroleum S.A., 5 Boulevard Royal, L-2449 Luxembourg, with a share
capital of DEM 285,648
(hereinafter called "the Company")
1. The Principal hereby instructs W&W to perform or cause third parties to
perform the following:
( ) to incorporate the Company
( ) to represent the Principal at the shareholders' meeting of the
Company
( ) to join the board of directors of the Company
( ) to act as lawyers on behalf of the company and to watch the
structure
2. W&W shall only act within the bounds of law and ethics according to the
instructions of the Principal, in the absence of such instructions, W&W
may act on its own initiative.
3. The Principal may appoint one or more representatives to act on their
behalf. Their proxies may be revoked at any time. If more than one
person is entitled to give instructions as Principal or representative,
W&W may follow the instructions of any one of them without previously
contacting the other persons so entitled.
4. The Principal undertakes to put the necessary qualifying shares at the
disposal of W&W. Monies received in respect of such shares belong to the
Principal.
5. The Principal and his successors/assignees undertake to release,
discharge and indemnify W&W or third persons appointed by W&W for all
claims brought against them in connection with the performance of this
Agreement, especially in their capacity as founder, shareholder, member
of the board of directors or administrator. W&W is only liable for
unlawful intent and gross negligence.
6. The Principal will reimburse W&W all expenditures, fees, taxes and any
other costs incurred in connection with this Agreement and in the
interest of the Principal. Besides, W&W is authorized to charge its
<PAGE>
usual fees. For the activity as directors, W&W shall receive CHF 6,000
per director per annum.
7. This Agreement may be terminated by either party at any time. It is,
however, not automatically terminated in the case of loss of capacity to
act or bankruptcy of either party.
8. This Agreement is subject to Swiss law. Any dispute arising out of this
Agreement is herewith subjected to the jurisdiction of the ordinary
courts at Zurich.
Zurich.
The Principal: W&W:
/s/ Peter Young /s/ Juerg Wyler /s/ Marco Wolf
for and on behalf of Juerg Wyler Marco Wolf
Morgan Grenfell
<PAGE>
AGREEMENT
between
Morgan Grenfell, 20 Finsbury Circus, London EC2M 1 NB,
(hereinafter called "the Principal")
and
Marco Wolf, Baldernstrasse 18, 8134 Adliswit,
Juerg Wyler, Schwoesterrain, 8714 Feldbach,
(hereinafter called "W&W")
Silva Investment Ltd., Grand Cayman, Cayman Islands
(hereinafter called "the Company")
1. The Principal hereby instructs W&W to perform or cause third parties to
perform the following:
- to acquire all the shares of the Company on behalf of Morgan
Grenfell (CI) Ltd., Jersey which acts for and on behalf of Herbert
VanDalen;
- to represent the Principal at the shareholders' meeting of the
Company to take the necessary resolutions to capitalize the company;
- to join the board of directors of the Company, to take the necessary
resolutions and to acquire 1,000,000 shares in Solv-Ex Corp. on
behalf of the Company;
- to act as lawyers on behalf of the company, to watch the structure
and to prepare the necessary agreements to close the Participation
Loan with Horten Technology S.A. to acquire 1,000,000 shares in
Solv-Ex for a share price of USD 16.50. The Participation Loan
shall be closed that repayment shall be based of an amount of
1,000,000 shares and that repayment shall depend on the average
share price of Solv-Ex of five banking days before the announcement
that said Participation Loan shall be repaid.
2. W&W shall only act within the bounds of law and ethics according to the
instructions of the Principal, in the absence of such instructions, W&W
may act on its own initiative.
3. The Principal may appoint one or more representatives to act on their
behalf. Their proxies may be revoked at any time. If more than one
person is entitled to give instructions as Principal or representative,
W&W may follow the instructions of any one of them without previously
contacting the other persons so entitled.
4. The Principal undertakes to put the necessary qualifying shares at the
disposal of W&W. Monies received in respect of such shares belong to the
Principal.
<PAGE>
5. The Principal and his successors/assignees undertake to release,
discharge and indemnify W&W for all claims brought against them in
connection with the performance of this Agreement, especially in their
capacity as founder, shareholder, member of the board of directors or
administrator. W&W is only liable for unlawful intent and gross
negligence.
6. The Principal will reimburse W&W all expenditures, fees, taxes and any
other costs incurred in connection with this Agreement and in the
interest of the Principal. Besides, W&W is authorized to charge its
usual fees. For the activity as directors, W&W shall receive CHF 10,000
per director per annum.
7. This Agreement may be terminated by either party at any time. It is,
however, not automatically terminated in the case of loss of capacity to
act or bankruptcy of either party.
8. This Agreement is subject to Swiss law. Any dispute arising out of this
Agreement is herewith subjected to the jurisdiction of the ordinary
courts at Zurich.
Zurich.
The Principal: W&W:
/s/ Peter Young /s/ Juerg Wyler /s/ Marco Wolf
for and on behalf of Juerg Wyler Marco Wolf
Morgan Grenfell and
agent of Morgan Grenfell
(CI) Ltd.
<PAGE>
AGREEMENT
between
Morgan Grenfell, 20 Finsbury Circus, London EC2M 1 NB,
(hereinafter called "the Principal")
and
Marco Wolf, Baldernstrasse 18, 8134 Adliswit,
Juerg Wyler, Schwoesterrain, 8714 Feldbach,
(hereinafter called "W&W")
Phemex Establishment, Augarten 8, Postfach 339, 9490 Vaduz
(hereinafter called "the Company")
1. The Principal hereby instructs W&W to perform or cause third parties to
perform the following:
( ) to incorporate the Company
( ) to represent the Principal at the shareholders' meeting of the
Company
( ) to join the board or to appoint the directors of the Company
( ) to act as lawyers on behalf of the company and to watch the
structure
2. W&W shall only act within the bounds of law and ethics according to the
instructions of the Principal, in the absence of such instructions, W&W
may act on its own initiative.
3. The Principal may appoint one or more representatives to act on their
behalf. Their proxies may be revoked at any time. If more than one
person is entitled to give instructions as Principal or representative,
W&W may follow the instructions of any one of them without previously
contacting the other persons so entitled.
4. The Principal undertakes to put the necessary qualifying shares at the
disposal of W&W. Monies received in respect of such shares belong to the
Principal.
5. The Principal and his successors/assignees undertake to release,
discharge and indemnify W&W or third persons appointed by W&W for all
claims brought against them in connection with the performance of this
Agreement, especially in their capacity as founder, shareholder, member
of the board of directors or administrator. W&W is only liable for
unlawful intent and gross negligence.
6. The Principal will reimburse W&W all expenditures, fees, taxes and any
other costs incurred in connection with this Agreement and in the
interest of the Principal. Besides, W&W is authorized to charge its
usual fees. For the activity as directors, W&W shall receive CHF 6,000
per director per annum.
<PAGE>
7. This Agreement may be terminated by either party at any time. It is,
however, not automatically terminated in the case of loss of capacity to
act or bankruptcy of either party.
8. This Agreement is subject to Swiss law. Any dispute arising out of this
Agreement is herewith subjected to the jurisdiction of the ordinary
courts at Zurich.
London.
The Principal: W&W:
/s/ Peter Young /s/ Juerg Wyler /s/ Marco Wolf
for and on behalf of Juerg Wyler Marco Wolf
Morgan Grenfell
<PAGE>
AGREEMENT
between
Morgan Grenfell, 20 Finsbury Circus, London EC2M 1 NB,
(hereinafter called "the Principal")
and
Marco Wolf, Baldernstrasse 18, 8134 Adliswil,
Juerg Wyler, Schwoesterrain, 8714 Feldbach,
(hereinafter called "W&W")
Russ Oil & Technology S.A., 5 Boulevard Royal, L-2449 Luxembourg, with a share
capital of SEK 300,000--.,
(hereinafter called "the Company")
1. The Principal hereby instructs W&W to perform or cause third parties to
perform the following:
( ) to incorporate the Company
( ) to represent the Principal at the shareholders' meeting of the
Company
( ) to join the board of directors of the Company
( ) to act as lawyers on behalf of the company and to watch the
structure
2. W&W shall only act within the bounds of law and ethics according to the
instructions of the Principal. In the absence of such instructions, W&W
may act on its own initiative. Especially W&W shall be authorized to use
the funds of Scandi Technology to incorporate the Company as a pledge or
take the funds directly from such account Citco Bank in Amsterdam.
3. The Principal may appoint one or more representatives to act on their
behalf. Their proxies may be revoked at any time. If more than one
person is entitled to give instructions as Principal or representative,
W&W may follow the instructions of any one of them without previously
contacting the other persons so entitled.
4. The Principal undertakes to put the necessary qualifying shares at the
disposal of W&W. Monies received in respect of such shares belong to the
Principal.
5. The Principal and his successors/assignees undertake to release,
discharge and indemnify W&W for all claims brought against them in
connection with the performance of this Agreement, especially in their
capacity as founder, shareholder, member of the board of directors or
administrator. W&W is only liable for unlawful intent and gross
negligence.
6. The Principal will reimburse W&W all expenditures, fees, taxes and any
other costs incurred in connection with this Agreement and in the
interest of the Principal. Besides, W&W is authorized to charge its
<PAGE>
usual fees. For the activity as directors, W&W shall receive CHF
15,000.- per director per annum.
7. This Agreement may be terminated by either party at any time. It is,
however, not automatically terminated in the case of loss of capacity to
act or bankruptcy of either party.
8. This Agreement is subject to Swiss law. Any dispute arising out of this
Agreement is herewith subjected to the jurisdiction of the ordinary
courts at Zurich.
Zurich,
The Principal: W&W:
/s/ Peter Young /s/ Juerg Wyler /s/ Marco Wolf
for and on behalf of Juerg Wyler Marco Wolf
Morgan Grenfell
