UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. ___)*
Nord Resources Corporation
(Name of Issuer)
Common Stock, par value $.01 per share
(Title of Class of Securities)
655555 10 0
(CUSIP Number)
James C. Colihan, Esq.
Coudert Brothers
1114 Avenue of the Americas
New York, New York 10036
(212)626-4680
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
April 15, 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 / /.
Check the following box if a fee is being paid with the statement /X/. (A fee
is not required only if the reporting person: (1) has a previous statement on
file reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7)
Note: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are to
be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter disclosure
provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
SCHEDULE 13D
CUSIP No. 655555 10 0 Page 2 of 12 Pages
1 Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
Jean-Raymond Boulle (foreign person - no IRS identification
number issued)
2 Check the Appropriate Box If a Member of a Group*
a. / /
b. / /
3 SEC Use Only
4 Source of Funds*
N/A
5 Check Box If Disclosure of Legal Proceedings Is Required Pursuant to
Items 2(d) or 2(e) / /
6 Citizenship or Place of Organization
British
7 Sole Voting Power
Number of -0-
Shares
Beneficially 8 Shared Voting Power
Owned By 3,160,000
Each
Reporting 9 Sole Dispositive Power
Person -0-
With
10 Shared Dispositive Power
3,160,000
11 Aggregate Amount Beneficially Owned by Each Reporting Person
3,160,000
12 Check Box If the Aggregate Amount in Row (11) Excludes Certain
Shares* / /
13 Percent of Class Represented By Amount in Row (11)
16.6%
14 Type of Reporting Person*
IN
*SEE INSTRUCTIONS BEFORE FILLING OUT!
SCHEDULE 13D
CUSIP No. 655555 10 0 Page 3 of 12 Pages
1 Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
MIL (Investments) S.A. (foreign person - no IRS
identification number issued)
2 Check the Appropriate Box If a Member of a Group*
a. / /
b. / /
3 SEC Use Only
4 Source of Funds*
WC
5 Check Box If Disclosure of Legal Proceedings Is Required Pursuant to
Items 2(d) or 2(e) / /
6 Citizenship or Place of Organization
Luxembourg
7 Sole Voting Power
Number of -0-
Shares
Beneficially 8 Shared Voting Power
Owned By 3,160,000
Each
Reporting 9 Sole Dispositive Power
Person -0-
With
10 Shared Dispositive Power
3,160,000
11 Aggregate Amount Beneficially Owned by Each Reporting Person
3,160,000
12 Check Box If the Aggregate Amount in Row (11) Excludes Certain
Shares* / /
13 Percent of Class Represented By Amount in Row (11)
16.6%
14 Type of Reporting Person*
CO
*SEE INSTRUCTIONS BEFORE FILLING OUT!
This statement on Schedule 13D (the "Statement") is filed by MIL (Investments)
S.A., a Luxembourg corporation ("MIL"), and Mr. Jean-Raymond Boulle, a British
citizen with a resident address at Seaside Plaza, Batiment C, 6 avenue des
Ligures, MC-98000 Monaco ("Mr. J.R. Boulle", together with MIL, the "Reporting
Persons"), in connection with the acquisition by MIL on April 15, 1996 of
3,160,000 shares (the "Acquired Shares") of common stock, par value $.01 per
share (the "Common Stock"), of Nord Resources Corporation, a Delaware
corporation ("Nord"), and a loan to Nord in the amount of $2,100,000 (the
"Loan"), which is evidenced by a promissory note of Nord dated April 15, 1996
(the "Promissory Note").
Each Reporting Person acknowledges responsibility with respect to the
information provided as to such signatory, but assumes no responsibility with
respect to the information provided as to any other signatory.
Item 1. Security and Issuer
This Statement relates to the Common Stock and the Promissory Note. The
Promissory Note is convertible into 840,000 shares of Common Stock (the
"Conversion Shares") subject to and contingent upon, the occurrence of certain
events, as hereinafter described. The principal executive offices of Nord are
located at 8150 Washington Village Drive, Dayton, Ohio 45458.
Item 2. Identity and Background
This statement is filed by MIL and Mr. J.R. Boulle. A copy of the Joint Filing
Agreement between MIL and Mr. J.R. Boulle is attached hereto as Exhibit 1.
MIL is engaged primarily in the business of investing in the natural resources
and mining industries. The principal executive offices of MIL are located at
Boulevard Royal 25B, L-2449, Luxembourg, Luxembourg. The directors of MIL are
Mr. J.R. Boulle, Mr. Ekkehart Kessel and Mr. Edmond Van de Kelft. Mr. Kessel, a
German citizen, is self-employed and is principally engaged in the business of
insurance advisory services, with a resident address at 25 avenue des Bains,
L-5610 Mondorf-Les-Bains, Luxembourg. Mr. Van de Kelft, a citizen of Belgium,
is principally engaged in the business of management consultancy and insurance
brokerage through ATRICO BVBA, with a resident address at Frankryklei, B-2000
Antwerpen, Belgium. Mr. J.R. Boulle is principally engaged in the business of
investing in the natural resources and mining industries as a member of the
board of management of MIL, with a resident address at Seaside Plaza, Batiment
C, 6 avenue des Ligures, MC-98000 Monaco. Mr. J.R. Boulle is the indirect
beneficial owner of all of the issued and outstanding capital stock of MIL.
During the last five years, none of the persons listed above, or identified as
directors or officers of any such person, 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 and as a result of such proceeding 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
MIL's (i) acquisition of the Acquired Shares for an aggregate purchase price of
$7,900,000 (the "Common Stock Purchase Price") and (ii) loan to Nord in the
amount of $2,100,000 (the "Loan Amount"), were paid in cash from MIL's working
capital.
Item 4. Purpose of Transaction
On April 15, 1996, MIL entered into a Stock Purchase and Sale Agreement between
MIL and Nord related to the purchase of the Acquired Shares (the "Stock
Agreement") and an Agreement between MIL and Nord related to the Loan and the
Promissory Note (the "Note Agreement"). Pursuant to the Stock Agreement, MIL
purchased the Acquired Shares for an aggregate purchase price of $7,900,000
($2.50 per share) and, pursuant to the Note Agreement, MIL made the Loan to
Nord, which indebtedness is evidenced by the Promissory Note. Copies of the
Stock Agreement, the Note Agreement and the Promissory Note are attached hereto
as Exhibits 2, 3 and 4 respectively. Certain material provisions of the Stock
Agreement, the Note Agreement and the Promissory Note are summarized in Item 6
of this Statement.
MIL purchased the Common Stock and made the Loan in exchange for the Promissory
Note because it believed they represented an attractive investment. MIL will
continuously evaluate the business and business prospects of Nord and MIL's
present and future investments in, and intentions with respect to, Nord. Subject
to applicable securities laws, market conditions and the evaluation referred to
in the preceding sentence, at any time or from time to time, MIL may seek to
acquire shares of Common Stock or the right to acquire such shares, through open
market purchases, privately negotiated transactions or otherwise, or to dispose
of any or all of the Acquired Shares, Conversion Shares or other shares of
Common Stock or the Promissory Note owned by it in public or private
transactions, in each case as it may determine in its sole discretion. MIL is
not restricted in any way from acquiring more shares of Common Stock or from
disposing of shares of Common Stock, except for compliance with relevant
securities laws. As of the date of this Statement, MIL has not determined
whether it will acquire additional Common Stock and has not fixed any number of
shares of additional Common Stock it might seek to acquire or any additional
amount of money it might be willing to invest in Nord. As more fully discussed
in Item 6 below, pursuant to the Stock Agreement, MIL was granted the right to
designate three (3) nominees to the Board of Directors of Nord (the "Board").
Pursuant to such right, MIL has designated Messrs. Joseph Max Yvan Boulle and
Marc Franklin as its designees to the Board and has retained the right to
designate a third nominee to the Board. In addition, Nord has agreed to nominate
and to use its best efforts to obtain the election of any three individuals
designated in writing by MIL (the "MIL Nominees") at each annual or special
meeting of stockholders called for the purpose of filling positions on the Board
through and including the annual meeting of Stockholders to be held in the year
2000. In no event shall the size of the Board be increased above, or decreased
below, eight (8) without the approval of at least two (2) of the MIL Nominees.
Except as discussed above and except as disclosed in Item 6 below, neither of
the Reporting Persons presently has any plans or proposals which relate to or
would result in any of the actions described in clauses (a) through (j) of the
instructions to Item 4 to Schedule 13D or in any action similar to any of those
enumerated in clauses (a) through (j).
The Reporting Persons intend to evaluate continuously the investment in Nord
described herein and, based on such evaluation, may determine at a future date
to change the current position with respect to any of the actions described in
clauses (a) through (j) of the instructions to Item 4 to Schedule 13D.
Item 5. Interest in Securities of the Issuer
(a) MIL is the beneficial and record owner of 3,160,000 shares of Common
Stock, representing approximately 16.6% of the issued and outstanding
shares of such Common Stock after giving effect to the issuance
thereof. In addition, MIL is the holder of the Promissory Note, which,
as more fully described in Item 6 below, is convertible (subject to the
satisfaction of certain contingencies) into 840,000 shares of Common
Stock, representing approximately 4.4% of the issued and outstanding
shares of Common Stock after giving effect to the issuance thereof.
Mr. Joseph Max Yvan Boulle and Mr. Marc Franklin have been appointed
as directors of Nord in accordance with the terms of the Stock
Agreement. Additionally, under the terms of the Stock Agreement and
as more fully described in Item 6 below, MIL has the right at any time
to name an additional nominee to the Board. Mr. J.R. Boulle owns
indirectly all the issued and outstanding capital stock of MIL. Mr.
Joseph Max Yvan Boulle is the brother of Mr. J.R. Boulle.
Except as disclosed in this Item 5(a), neither MIL, Mr. J.R. Boulle
nor, to the best of their knowledge, any of MIL's executive officers
and directors, beneficially owns any securities of Nord or has a right
to acquire any securities of Nord.
(b) MIL and Mr. J.R. Boulle may be deemed to hold shared power to direct
the vote and to direct the disposition of the Acquired Shares, the
Promissory Note and, upon the issuance thereof, the Conversion Shares
held by MIL (subject to the provisions of the Stock Agreement and the
Note Agreement), by virtue of Mr. J.R. Boulle's beneficial ownership of
all of the issued and outstanding capital stock of MIL.
Except as described in this Item 5(b), neither MIL, Mr. J.R. Boulle
nor, to the best of their knowledge, any of MIL's executive officers or
directors, presently has the power to vote or to direct the vote or to
dispose or direct the disposition of any of the Acquired Shares, the
Promissory Note or, upon the issuance thereof, the Conversion Shares
held by MIL.
(c) Except as disclosed in this Statement, neither MIL, Mr. J.R. Boulle
nor, to the best of their knowledge, any of MIL's executive officers or
directors, has effected any transaction in securities of Nord during
the past 60 days.
(d) No person, other than MIL and Mr. J.R. Boulle, is known to have the
right to receive, or the power to direct the receipt of dividends from,
or the proceeds from the sale of, any of the securities covered by this
Statement.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships
with respect to Securities of the Issuer
Set forth below are summaries of certain material provisions of each of the
Stock Agreement and the Note Agreement. These summaries are qualified in their
entirety by reference to the complete text of such agreements, copies of which
are attached hereto as exhibits and incorporated herein by reference.
Stock Agreement
Pursuant to the terms of the Stock Agreement, on April 15, 1996, MIL purchased
the Acquired Shares from Nord for an aggregate purchase price of $7,900,000
($2.50 per share).
Concurrently with the purchase of the Acquired Shares, the Board expanded its
size to eight (8) members and elected the following two (2) nominees designated
by MIL: Mr. Joseph Max Yvan Boulle and Mr. Marc Franklin. MIL has retained the
right to designate at any time a third nominee to the Board. Nord has agreed to
nominate and to use its best efforts to obtain the election of any MIL Nominees
at each annual or special meeting of stockholders called for the purpose of
filling positions on the Board or in any written consent executed in lieu of
such a meeting of Stockholders, through and including the annual meeting of
Stockholders to be held in the year 2000. In no event shall the size of the
Board be increased above, or decreased below, eight (8) without the approval of
at least two (2) of the MIL Nominees.
MIL has agreed to vote all of the shares of Common Stock it owns and may own in
the future for the nominees designated by the Board for the Board through and
including the annual meeting of stockholders to be held in the year 2000.
Notwithstanding anything to the contrary contained in the Stock Agreement, (i)
if MIL and any assignees of MIL permitted under the Stock Agreement in the
aggregate at any time own in excess of 50% of the then issued and outstanding
shares of Common Stock, they shall be entitled to vote their shares of Common
Stock for directors without regard to the restrictions described above, and (ii)
if MIL and any assignees of MIL permitted under the Stock Agreement in the
aggregate at any time own less than 15% of the then issued and outstanding
shares of Common Stock, they collectively shall be entitled to designate the
following number of Directors:
Percentage Ownership Number of MIL Nominees
10% or more 2
5% to 10% 1
less than 5% 0
Prior to the execution of the Stock Agreement, the Board unanimously adopted a
resolution approving the transactions contemplated by the Stock Agreement and,
in connection therewith, waiving the provisions of Section 203 of the Delaware
General Corporation Law as it relates to MIL and its affiliates in connection
with such transactions and any future transactions between Nord and MIL or its
affiliates.
Pursuant to the Stock Agreement, Nord has granted MIL one demand registration
right (the "Demand Registration Right") and piggy-back registration rights (the
"Piggy-Back Registration Rights") with respect to the Acquired Shares and the
Conversion Shares, if at the time MIL (or the successors or permitted assignees
of MIL) holds of record collectively at least 500,000 shares of unregistered
Common Stock ("Registrable Securities").
If MIL and Nord are not able to register all the shares of Common Stock they
wish to register in connection with the exercise of the Demand Registration
Right or the Piggy-Back Registration Rights, shares will be registered according
to the following priorities:
(a) If such registration relates to Demand Registration Rights, a first
priority shall be given to the Registrable Securities held by MIL; a
second priority shall be given to shares of Common Stock sought to be
registered by Nord; and a third priority shall be given to any other
equity securities as to which Nord may in the future grant registration
rights; or
(b) if such registration relates to Piggy-Back Registration Rights, a first
priority shall be given to shares of Common Stock sought to be
registered by Nord; a second priority shall be given to the Registrable
Securities held by MIL requested to be included in such registration;
and a third priority shall be given to any other equity securities as
to which Nord may in the future grant registrations rights.
Note Agreement
Pursuant to the Note Agreement, MIL made the Loan to Nord, which indebtedness is
evidenced by the Promissory Note. The Promissory Note is unsecured and, upon the
occurrence of certain events as described below, is convertible into the
Conversion Shares. Based on the number of Conversion Shares (i.e., 840,000
shares of Common Stock) and the amount of the Loan (i.e., $2,100,000), the
conversion price per share of Common Stock issuable upon conversion of the
Promissory Note, if the conditions set forth below are satisfied, will be $2.50
per share.
The Promissory Note provides that, if not converted as described below, it will
bear interest at the rate of 7% per annum, with principal and interest due and
payable in full on April 15, 1997. Interest on the Loan will accrue from the
date of issuance, until paid, unless the Loan is converted pursuant to the Note
Agreement and the Promissory Note.
The Promissory Note provides that, in the event that the stockholders of Nord
(the "Stockholders") at the annual meeting of Stockholders to be held in June
1996, approve (the "Stockholder Approval") the conversion of the Loan into
shares of Common Stock (the "Loan Conversion"), and the New York Stock Exchange,
Inc. approves (the "NYSE Approval") the listing of the Conversion Shares, the
Loan, immediately upon the latter of such Stockholder Approval or NYSE Approval
(the date on which the latter of such Stockholder Approval or NYSE Approval
occurs being hereinafter referred to as the "Conversion Date"), as the case may
be, will be converted into the Conversion Shares and the Loan, including all
accrued interest thereon, will be cancelled. The Loan Conversion will occur on
the Conversion Date, provided that in no event shall the Conversion Date be
later than April 15, 1997. In addition to the foregoing and notwithstanding
anything to the contrary contained in the Promissory Note, if the Conversion
Date occurs on or after an Event of Default (as defined in the Note Agreement
and the Promissory Note), the Promissory Note shall be converted into Conversion
Shares only at the election of MIL.
The Promissory Note contains provisions for Nord to "gross-up" MIL for any
amounts paid, transferred or issued to MIL pursuant to the Note Agreement and
the Promissory Note (including, without limitation, in connection with the Loan
Conversion) which are not made free and clear of, or without any deductions or
withholding on account of, taxes imposed by the United States of America.
Nord has agreed to use its best efforts to take all actions necessary to hold
its annual meeting of Stockholders (the "Annual Meeting") on June 4, 1996 or the
earliest possible date thereafter which provides at least thirty (30) days
between proxy mailing and the meeting date (the "Meeting Date"), and to use its
best efforts to obtain the Stockholder Approval at such meeting or any
adjournment thereof. The Board has already unanimously approved the transactions
contemplated under the Note Agreement, including the Loan Conversion, and has
unanimously resolved to recommend approval of the Loan Conversion by the
Stockholders. Nord agreed to set the record date for the Annual Meeting as April
22, 1996.
During the period from April 15, 1996 and continuing until the Meeting Date or
any adjournment or postponement thereof, Nord has agreed not to (i) offer, sell,
contract to sell or otherwise issue or dispose of any shares of Common Stock or
any other securities of Nord, and any other securities that are convertible into
or exchangeable for or that represent the right to receive shares of Common
Stock or any other securities of Nord, or (ii) announce or effect any stock
split, stock dividend, stock combination, reverse stock split, stock
reclassification or reorganization with respect to shares of Common Stock or any
other security of Nord.
Nord has granted MIL demand registration rights and piggy-back registration
rights with respect to the Conversion Shares on the same terms as the Demand
Registration Rights and Piggy-Back Registration Right granted with respect to
the Acquired Shares pursuant to the Stock Agreement.
Other Provisions
Nord has agreed to indemnify and hold MIL harmless against any losses incurred
or sustained by MIL which arise out of or result from a breach of any
representation, warranty or covenant of Nord contained in the Stock Agreement or
the Note Agreement, and MIL has agreed to indemnify and hold Nord harmless
against any losses incurred or sustained by Nord which arise out of or result
from any breach of any representation, warranty or covenant of MIL contained in
the Stock Agreement or the Note Agreement.
Neither the Stock Agreement, the Note Agreement, the Promissory Note nor any
rights, obligations or claims thereunder may be assigned by the parties thereto;
except that upon prior written notice to Nord, MIL shall have the right to
assign the Stock Agreement, the Note Agreement, the Promissory Note and the
rights, obligations and claims thereunder to Mr. J.R. Boulle or to any entity
controlled by Mr. J.R. Boulle, provided that Mr. J.R. Boulle thereafter
continues to remain in control of such entity (the terms "controlled" and
"control" shall have the meanings ascribed to them in Rule 12b-2 promulgated by
the Securities and Exchange Commission (the "SEC") under the Securities Exchange
Act of 1934, as amended).
The Acquired Shares and the Promissory Note were issued, and the Conversion
Shares, if conversion of the Promissory Note occurs, will be issued, in reliance
upon the transaction "safe harbor" afforded by Regulation S, as promulgated by
the SEC under the 1933 Act.
Except as disclosed above or elsewhere in this Statement, none of the persons
named in Item 2 hereto have any contracts, arrangements, understandings or
relationships with respect to any securities of Nord.
Item 7. Material to be filed as Exhibits
The following are filed herewith as exhibits:
Exhibit 1 Joint Filing Agreement by and between MIL and Mr. J.R. Boulle,
dated April 24, 1996.
Exhibit 2 Stock Purchase and Sale Agreement between Nord and MIL dated
April 15, 1996.
Exhibit 3 Agreement between Nord and MIL dated April 15, 1996.
Exhibit 4 Promissory Note of Nord dated April 15, 1996.
SIGNATURES
After reasonable inquiry and to the best of their knowledge and belief, the
undersigned certify that the information set forth in this Statement is true,
complete and correct.
Dated: April 24, 1996
MIL (INVESTMENTS) S.A.
By: /s/ Ekkehart Kessel
Name: Ekkehart Kessel
Title: Administrateur
By: /s/ Edmond Van de Kelft
Name: Edmond Van de Kelft
Title: Administrateur
/s/ Jean-Raymond Boulle
JEAN-RAYMOND BOULLE
JOINT FILING AGREEMENT
This will confirm the agreement by and among all of the undersigned
that the Schedule 13D filed on or about this date with respect to the beneficial
ownership of the undersigned of shares of the common stock of Nord Resources
Corporation is being filed on behalf of each of the parties named below. This
Agreement may be executed in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.
Dated: April 24, 1996
MIL (INVESTMENTS) S.A. /s/ Jean-Raymond Boulle
JEAN-RAYMOND BOULLE
By: /s/ Ekkehart Kessel
Name: Ekkehart Kessel
Title: Administrateur
By: /s/ Edmond Van de Kelft
Name: Edmond Van de Kelft
Title: Administrateur
STOCK PURCHASE AND SALE AGREEMENT
BETWEEN
NORD RESOURCES CORPORATION
AND
MIL (INVESTMENTS) S.A.
April 15, 1996
THE SECURITIES TO WHICH THIS AGREEMENT RELATES HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED ("1933 ACT") AND MAY NOT BE OFFERED, SOLD
OR DELIVERED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF,
ANY U.S. PERSON (AS DEFINED HEREIN) PRIOR TO MAY 25, 1996, EXCEPT IN ACCORDANCE
WITH REGULATION S UNDER THE 1933 ACT.
TABLE OF CONTENTS
PAGE #
1. Sale of Purchase Shares..........................................3
2. 1933 Act - Regulation S..........................................4
3. Board Representation.............................................5
5. Registration Rights..............................................6
7. Representations and Warranties of NRC............................7
8. Representations and Warranties of Investor......................13
9. Deliveries of NRC...............................................17
10. Deliveries of Investor..........................................18
11. Indemnity; Survival. ..........................................18
12. Public Announcements............................................21
13. Brokers and Finders.............................................21
14. Assignability. .................................................21
15. Governing Law; Consent to Jurisdiction..........................22
16. Entire Agreement................................................22
17. Binding Effect..................................................23
18. Notices.........................................................23
19. Further Assurances..............................................24
20. Severability....................................................24
21. No Third Party Beneficiaries....................................24
22. Headings........................................................24
23. Counterparts....................................................25
-i-
STOCK PURCHASE AND SALE AGREEMENT
STOCK PURCHASE AND SALE AGREEMENT ("Agreement") made this 15th day of
April, 1996, by and between NORD RESOURCES CORPORATION, a Delaware corporation
("NRC" or the "Company"), having its principal place of business at 8150
Washington Village Drive, Dayton, Ohio 45458 and MIL (INVESTMENTS) S.A., a
Luxembourg corporation (the "Investor"), having is principal place of business
at Boulevard Royal 25B, L-2449, Luxembourg, Luxembourg.
WHEREAS, NRC is a public company with its shares of common stock, $.01
par value ("NRC Shares"), listed on the New York Stock Exchange ("NYSE"); and
WHEREAS, NRC desires to sell to Investor and Investor desires to
purchase from NRC, 3,160,000 NRC Shares ("Purchase Shares"), representing
approximately 19.9% of the issued and outstanding NRC Shares on a
"before-issuance" basis (i.e., computed in accordance with New York Stock
Exchange ("NYSE") Rule 312.03(e)) in reliance upon the transaction "safe harbor"
afforded by Regulation S ("Regulation S"), as promulgated by the Securities and
Exchange Commission ("SEC") under the Securities Act of 1933, as amended (the
"1933 Act"), subject to the terms and conditions set forth herein; and
WHEREAS, the parties desire that the board of directors of NRC (the
"Board") be expanded to eight (8) members (not more nor less than eight) of
which the Investor will have the right to designate three (3) members to the
Board and the Board (excluding the members designated by Investor) will have
the right to designate the remaining five (5) members; and
WHEREAS, NRC and Investor desire to set forth herein their other
agreements and understandings.
NOW THEREFORE, in consideration of the premises and the mutual
covenants and conditions set forth herein and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, NRC
and Investor hereby agree as follows:
1. Sale of Purchase Shares. NRC hereby agrees to sell the
Purchase Shares to Investor and Investor hereby agrees to purchase the Purchase
Shares from NRC upon the terms and conditions set forth herein. The purchase
price ("Purchase Price") for the Purchase Shares is $7,900,000. The Purchase
Price has been paid by wire transfer of immediately available funds to the
account of NRC at National City Bank, Dayton, Ohio, ABA# 042 200 279 (Account
No. 767806130) simultaneously with the execution and delivery of this
Agreement. NRC hereby acknowledges receipt of the Purchase Price and Investor
hereby acknowledges receipt of the Purchase Shares. All "$" references herein
are to United States dollars.
2. 1933 Act - Regulation S.
(a) The Purchase Shares are being offered and sold in
an offshore transaction pursuant to Regulation S.
(b) The Purchase Shares have not been and will not be
registered under the 1933 Act, except as provided for in Section 5 below. The
Investor acknowledges and agrees that from the date hereof until the forty-first
(41st) day after the date hereof (the "Restricted Period"), the Purchase Shares
may not be offered, sold or delivered within the United States or to, or for the
account or benefit of, any U.S.Person (as defined in Rule 902(o) promulgated by
the SEC under the 1933 Act), unless the Purchase Shares are registered under the
1933 Act, or an exemption from the registration requirements of the 1933 Act is
available.
(c) Certificates representing the Purchase Shares during the
Restricted Period will contain a restrictive legend, the form of which is
annexed hereto as Exhibit A, prohibiting the offer, sale or delivery of the
Purchase Shares within the United States or to, or for the account or benefit
of, any U.S. Person during the Restricted Period. NRC represents and warrants
that no instructions restricting the free transferability of the Purchase Shares
have been, or will be, lodged with the transfer agent for the NRC Shares, other
than a "stop transfer" instruction to remain in force only until the end of the
Restricted Period for resales into the United States or to, or for the account
or benefit of, any U.S. Person, and that such Purchase Shares shall otherwise be
freely transferable on the books and records of the Company and such transfer
agent. Upon surrender of the initial certificates representing the Purchase
Shares to NRC after expiration of the Restricted Period, NRC shall promptly
instruct its transfer agent to issue one or more replacement certificates
representing the Purchase Shares without any restrictive legends thereon or
"stop transfer" instructions applicable thereto, in the name of the Investor and
in such denominations as the Investor shall specify. Nothing herein, however,
shall affect in any way the Investor's obligations and agreements to comply
with all securities laws upon resale of the Purchase Shares.
3. Board Representation. Concurrently with the closing
hereunder, the Board of Directors of NRC has expanded its size to eight (8)
members and has elected the three (3) members designated by Investor as
identified on Exhibit B annexed hereto (the "Investor's Nominees"). NRC
covenants and agrees to nominate and to use its best efforts to obtain the
election of the Investor's Nominees (either those individuals listed on Exhibit
B or any other individual(s) subsequently designated in writing by Investor) at
each annual or special meeting of stockholders called for the purpose of
filling positions on the Board of Directors, or in any written consent executed
in lieu of such a meeting of stockholders, through and including the annual
meeting of stockholders to be held in the year 2000. Such actions shall
include, without limitation, soliciting proxies for the election of directors
(including the Investor's Nominees) and recommending the Investor's Nominees
for election to the Board of Directors in the same manner as all other nominees
of the Company for election as director. If, following election to the Board of
Directors of the Company, any Investor's Nominee shall resign or be removed or
be unable to serve for any reason prior to the expiration of his term as a
director of the Company ("Withdrawing Investor's Nominee"), the Investor shall
within thirty (30) days of such event notify the Board of Directors of the
Company in writing of a replacement Investor's Nominee and the Board of
Directors of the Company shall take all action necessary to cause such
replacement Investor's Nominee to be elected or appointed to fill the unexpired
term of the Withdrawing Investor's Nominee and to recommend the replacement
Investor's Nominee for election to the Board of Directors in the same manner as
all other nominees of the Company for election as director at any subsequent
annual or special meeting of stockholders or pursuant to any written consent in
lieu of such meeting. In no event shall the size of the Board of Directors be
increased above, or decreased below, eight (8) without the approval of at least
two (2) of the Investor's Nominees. Investor covenants and agrees to vote all
of the NRC Shares it owns and may own in the future for the nominees designated
by the Board of Directors (excluding the Investor's Nominees) for the Board
through and including the annual meeting of stockholders to be held in the year
2000. Notwithstanding anything to the contrary contained in this Section 3, (x)
if Investor and any assignees of Investor permitted under Section 14 hereof in
the aggregate at any time own in excess of fifty (50%) percent of the then
issued and outstanding NRC Shares, they shall be entitled to vote their NRC
Shares for Directors without regard to the restrictions contained hereinabove,
and (y) if Investor and any assignees of Investor permitted under Section 14
hereof in the aggregate at any time own less than fifteen (15%) percent of the
then issued and outstanding NRC Shares, they collectively shall be entitled to
designate the following number of Directors:
Number of Investor's
Percentage Ownership Nominees
10% or more 2
5% to 10% 1
less than 5% 0
4. Waiver of Section 203. Prior to the execution of this
Agreement, the Board has unanimously adopted a resolution approving the
transactions contemplated under this Agreement and, in connection therewith,
waiving the provisions of Section 203 of the Delaware General Corporation Law
("DGCL") as it relates to the Investor and such transactions.
5. Registration Rights. The Company hereby grants to the
Investor the registration rights and "piggy-back registration rights" regarding
the Purchase Shares as set forth on Exhibit C annexed hereto, all of which are
incorporated herein by this reference.
6. New York Stock Exchange Listing. NRC covenants and agrees to
make application to list the Purchase Shares with the NYSE immediately after
the closing under this Agreement.
7. Representations and Warranties of NRC. NRC hereby represents
and warrants to Investor as of the date hereof as follows:
(a) NRC is a corporation duly organized, validly existing
and in good standing under the laws of the State of
Delaware and has full corporate power and authority
to conduct its business as now being conducted and to
own or lease the assets and properties it now owns or
holds under lease.
(b) NRC has full corporate power and authority to execute
and deliver this Agreement and to issue the Purchase
Shares and to consummate the transactions
contemplated on its part hereby.
(c) Prior to the date hereof, the Board of Directors of
NRC has duly approved this Agreement and has duly
authorized the execution and delivery of this
Agreement and the consummation of the transactions
contemplated hereby. This Agreement has been duly
executed and delivered by NRC and constitutes the
legal, valid and binding obligation of NRC
enforceable in accordance with its terms, subject to
bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium and similar laws of
general applicability relating to or affecting
creditors' rights and to general equity principles
(collectively, the "Enforceability Exceptions"). The
Purchase Shares have been duly authorized by NRC and
are validly issued, fully paid and nonassessable.
(d) The authorized capital stock of NRC consists of
25,000,000 NRC Shares, 15,838,408 NRC Shares being
issued and outstanding as of the date hereof and
1,915,113 NRC Shares being reserved for issuance
upon the exercise of currently outstanding options,
warrants and other securities convertible into NRC
Shares, all of which are described in the Form 10-K
(as defined below). All of the issued and
outstanding NRC Shares have been duly authorized and
validly issued and are fully paid and nonassessable.
Except as disclosed in the Form 10-K, as of the date
of this Agreement, there are no preemptive rights,
options, warrants, calls, commitments or agreements
of any nature to which the Company or any subsidiary
or affiliate is a party or by which any of them is
bound calling for the issuance or sale of shares of
any class of capital stock of NRC or securities
convertible into or exchangeable for shares of such
capital stock. As of the date of this Agreement,
neither the Company nor any of its subsidiaries or
affiliates is a party to or otherwise bound by any
agreement, instrument or commitment for the
issuance, purchase or repurchase of any shares of
capital stock of the Company, or entitled to the
benefit of any option, right of first refusal or
other elective privilege to purchase any shares of
capital stock of the Company. Neither NRC nor any
of its subsidiaries or affiliates has heretofore
granted to any person (i) the right to cause NRC to
register any NRC Shares beneficially owned by such
person under the 1933 Act or (ii) the right to
include any NRC Shares beneficially owned by such
person in any registration statement filed by NRC
under the 1933 Act.
(e) Neither the execution and delivery of this Agreement
by NRC, nor the consummation of the transactions
herein contemplated, will, with or without notice
and/or the passage of time, or both, (i) violate or
result in a breach of or constitute a default under
NRC's certificate of incorporation or by-laws, (ii)
violate any statute, ordinance, rule, regulation,
order or decree of any court or of any public or
governmental body, agency or authority applicable to
the Company or any subsidiary or affiliate of the
Company or by which any of their respective
properties or assets may be bound, the violation of
which could result in or reasonably be expected to
have a material adverse effect on the business,
financial condition or results of operations of NRC
and its subsidiaries, taken as a whole (" Material
Adverse Effect"), (iii) require any filing,
declaration or registration with, or permit, consent
or approval of, or the giving of any notice to, any
public or governmental body, agency or authority,
the failure of which could result in a Material
Adverse Effect, or (iv) result in a violation or
breach of, or constitute a default (or give rise to
any right of termination, cancellation or
acceleration) under any of the terms, conditions or
provisions of any note, bond, mortgage or other
evidence of indebtedness, indenture, license,
permit, concession, agreement or other instrument or
obligation to which the Company or any subsidiary or
affiliate is a party, or by which any of them or any
of their respective properties or assets may be
bound, which could result in a Material Adverse
Effect.
(f) NRC has the absolute right, power, and authority to
sell the Purchase Shares so as to vest in Investor
complete and absolute title to the Purchase Shares
free and clear of any lien, encumbrance, charge or
claim and to execute, deliver and carry out the
terms and provisions of this Agreement without the
approval or consent of any third party. The
Company has delivered to the Investor good and valid
title to the Purchase Shares, free and clear of all
liens, security interests, options, charges,
beneficial interests, claims and encumbrances of any
kind, except for restrictions on transfer imposed by
this Agreement and under applicable securities laws.
(g) NRC has delivered to Investor a copy of its Annual
Report on Form 10-K for the year ending December 31,
1995 (including exhibits and any amendments thereto)
filed with the SEC ("Form 10-K"). As of their
respective dates, neither the Form 10-K nor, to the
best of knowledge of the executive officers of NRC,
any other securities law filing made by NRC with the
SEC since January 1, 1994, contained any untrue
statement of a material fact or omitted to state a
material fact required to be stated therein or
necessary to make the statements made therein, in
light of the circumstances in which they were made,
not misleading in any material respect. Except as
disclosed in the Form 10-K, since December 31, 1995,
(i) there has not been any change, or any
development involving a prospective change, which
has had or could reasonably be expected to have a
Material Adverse Effect, (ii) NRC and its
subsidiaries have conducted their business only in,
and have not engaged in any transaction other than
in the ordinary course and consistent with past
practices prior to such date, and (iii) there has
been no material change in any accounting principles
or practices of NRC. Other than the business of NRC
disclosed in the Form 10-K, NRC is not engaged in
any other business that is material to its financial
condition or results of operations. The Form 10-K
discloses all defaults under contracts, agreements
and instruments to which NRC or its subsidiaries are
a party, where such defaults could have a Material
Adverse Effect.
(h) There are no suits, actions, claims, proceedings or
investigations pending or, to the best knowledge of
the Company, threatened against, relating to or
involving the Company or any subsidiary or affiliate
of the Company or any properties or rights of the
Company or any subsidiary or affiliate, before any
court, arbitrator or administrative or governmental
body, domestic or foreign, which if adversely
determined would have a Material Adverse Effect.
There are no such suits, actions, claims,
proceedings or investigations pending or, to the
best knowledge of the Company, threatened
challenging the validity or propriety of the
transactions contemplated by this Agreement.
(i) Neither the Company nor any subsidiary or affiliate
of the Company is in violation of or in default in
any respect under, the applicable statutes,
ordinances, rules, regulations, orders or decrees of
all federal, state, local and foreign governmental
bodies, agencies and authorities having, asserting or
claiming jurisdiction over any of them or over any
part of their operations or assets, except for such
violations and defaults which individually or in the
aggregate would not have a Material Adverse Effect.
(j) The Company is not an investment company, or a
company controlled by an investment company, within
the meaning of the Investment Company Act of 1940, as
amended.
(k) The Company is a "reporting company" as defined in
Rule 902 of Regulation S. The Company is in full
compliance with all filing obligations under Section
13 of the Securities Exchange Act of 1934 as amended
("1934 Act"). The Company has not offered the
Purchase Shares to any person in the United States,
any identifiable groups of U.S. citizens abroad, or
to any U.S. Person. In connection with the
transactions contemplated by this Agreement, the
Company has not conducted any "directed selling
efforts", as that term is defined in Rule 902 of
Regulation S, nor has the Company conducted any
general solicitation relating to the offer and sale
of the Purchase Shares to persons resident within
the United States or elsewhere.
(l) The transactions contemplated hereby do not effect a
"change of control" under any material agreement to
which NRC or any of its subsidiaries or affiliates is
a party.
8. Representations and Warranties of Investor. Investor hereby
represents and warrants to NRC as of the date hereof as follows:
(a) Investor is a corporation duly organized, validly
existing and in good standing under the laws of
Luxembourg and has full corporate power and authority
to conduct its business as now being conducted and to
own or lease the assets and properties it now owns or
holds under lease.
(b) Investor has full corporate power and authority to
execute and deliver this Agreement and to acquire the
Purchase Shares and to consummate the transactions
contemplated on its part hereby.
(c) The Board of Directors (or equivalent) of the
Investor has duly approved this Agreement and has
duly authorized the execution and delivery of this
Agreement and the consummation of the transactions
contemplated hereby. This Agreement has been duly
executed and delivered by Investor and constitutes
the legal, valid and binding obligations of Investor
enforceable in accordance with its terms, subject to
the Enforceability Exceptions.
(d) Neither the execution and delivery of this Agreement
by Investor, nor the consummation of the
transactions herein contemplated, will, with or
without notice and/or the passage of time, or both,
(i) violate or result in a breach of or constitute a
default under its organizational documents, (ii)
violate any statute, ordinance, rule, regulation,
order or decree of any court or of any public or
governmental body, agency or authority applicable to
the Investor or by which its properties or assets
may be bound, the violation of which could result in
or reasonably be expected to have a material adverse
effect on the business, financial condition or
results of operation of Investor and its
subsidiaries, taken as a whole ("MIL Material
Adverse Effect"), (iii) require any filing,
declaration or registration with, or permit, consent
or approval of, or the giving of any notice to, any
public or governmental body, agency or authority,
the failure of which could result in a MIL Material
Adverse Effect, or (iv) result in violation or
breach of, or constitute a default (or give rise to
any right of termination, cancellation or
acceleration) under any of the terms, conditions or
provisions of any note, bond, mortgage or other
evidence of indebtedness, indenture, license,
permit, concession, agreement or other instrument or
obligation to which the Investor is a party, or by
which it or its properties or assets may be bound,
which could result in a MIL Material Adverse Effect.
(e) The Investor is neither a U.S. Person nor a
Distributor (as defined in Regulation 902(c)
promulgated by the SEC under the 1933 Act).
(f) Investor was outside of the United States at the
time the offer to sell the Purchase Shares was made
to the Investor and the Investor was outside the
United States at the time the Investor executed this
Agreement and agreed to purchase the Purchase Shares
and paid the Purchase Price. The offer to sell the
Purchase Shares was directly communicated to the
Investor. At no time was the Investor presented with
or solicited by any leaflets, newspaper or magazine
article, radio or television advertisement or any
other form of general advertising or solicited or
invited to attend a promotional meeting.
(g) The Investor has been advised that the sale of the
Purchase Shares to the Investor has not been
registered under the 1933 Act or registered or
qualified under state securities laws, and that,
until the expiration of the Restricted Period, the
Purchase Shares may not be offered, sold or
delivered in the United States or to, or for the
account or benefit of, any U.S. Person unless the
Purchase Shares are registered under the 1933 Act or
an exemption from the registration requirements of
the 1933 Act is available. The Investor
acknowledges that no representation, warranty or
guaranty, express or implied, has been given to the
Investor by NRC or any officer, director, agent, or
employee of, legal counsel to, or any other person
connected with, NRC regarding the availability at
any time of an exemption from registration under the
1933 Act for any offer, sale or other transfer or
disposition of the Purchase Shares by the Investor;
and the Investor further understands and agrees that
the availability of any such exemption from
registration must be determined solely by the
Investor and the Investor's own legal counsel based
on the particular facts and circumstances existing
at the time of the proposed transaction.
(h) The Investor has not offered or sold, and agrees
that it will not offer or sell, any Purchase Shares
directly or indirectly in the United States or to,
or for the benefit, or account of, any U.S. Person
prior to the expiration of the Restricted Period,
unless the offer and sale of such Purchase Shares is
registered under the 1933 Act and any applicable
state securities laws, or exemptions from the
registration requirements thereof are available; and
that, thereafter, such Purchase Shares may be
offered or sold in the United States or to, or for
the account or benefit of, any U.S. Person only in
compliance with the registration requirements of the
1933 Act and any applicable State Act, or pursuant
to available exemptions from such registration
requirements, or in compliance with the provisions
of Regulation S. The Investor further represents
and warrants that it will not, through any short
sale, long sale or other hedging transaction, engage
in any transaction with the Purchase Shares prior to
the expiration of the Restricted Period which would
reduce the Investor's risk of ownership or
investment in the Purchase Shares.
(i) Investor has received from NRC the Form 10-K and has
had access to the books and records, officers,
employees and properties of NRC and its subsidiaries
and affiliates and has conducted its own due
diligence in connection with the transaction
contemplated by this Agreement.
9. Deliveries of NRC. Concurrently herewith, NRC has delivered
to Investor the following:
(i) An original executed and issued stock certificate
registered in the name of Investor and representing
all of the Purchase Shares, which contains the legend
set forth in Exhibit A annexed hereto;
(ii) A secretary's certificate, certifying resolutions of
the Board which, among other things: (i) approve the
execution and delivery of this Agreement and the
carrying out of the transactions contemplated hereby;
(ii) waive the provisions of Section 203 of the DGCL
relating to the Investor and the transactions
contemplated hereby; and (iii) expand the Board to
eight (8) members and appoint the Investor's Nominees
to the Board of Directors; and
(iii) An opinion of Spitzer & Feldman P.C. counsel to NRC,
in form and substance satisfactory to Investor.
10. Deliveries of Investor. Concurrently herewith, Investor has
delivered to NRC the following:
(a) The Purchase Price by wire transfer of federal funds
to the account identified in Section 1 above by NRC;
and
(b) A secretary's certificate (or equivalent) certifying
the resolutions of the board of directors (or
equivalent) of Investor which, among other things:
(i) approve the execution and delivery of this
Agreement and the carrying out of the transactions
contemplated hereby; and (ii) approve the purchase of
the Purchase Shares.
11. Indemnity; Survival.
(a) NRC hereby agrees to indemnify, defend, save and hold
Investor harmless from and against any and all damage, liability, loss, expense,
assessment, judgment or deficiency of any nature whatsoever (including, without
limitation, reasonable attorneys' fees, other costs and expenses incident to any
suit, action or proceeding) (collectively, "Losses") incurred or sustained by
Investor which arise out of or result from any breach of any representation,
warranty or covenant of NRC contained herein; provided however, that the
indemnity with respect to any representation and warranty shall terminate as of
the first date, if any, on which such representation or warranty ceases to
survive pursuant to subsection (d) hereof.
(b) Investor hereby agrees to indemnify, defend, save and hold
NRC harmless from and against any and all Losses incurred or sustained by NRC
which arise out of or result from any breach of any representation, warranty or
covenant of Investor contained herein; provided, however, that the indemnity
with respect to any representation and warranty shall terminate as of the first
date, if any, on which such representation or warranty ceases to survive
pursuant to subsection (d) hereof.
(c)(i) Promptly after the assertion of any claim or the
commencement of any action or proceeding with respect to any Loss for which
indemnity is provided pursuant to this Section, the party seeking such
indemnification shall notify the indemnifying party of such assertion or
proceeding; provided, however, that the failure promptly to give such notice
shall not affect any indemnified party's rights hereunder except to the extent
that such failure shall adversely affect any indemnifying party or its rights
hereunder in any material respect. The indemnified party shall advise the
indemnifying party of all material facts relating to such assertion within the
knowledge of the indemnified party, and shall afford the indemnifying party the
opportunity, at the indemnifying party's sole cost and expense, to defend
against such claims for liability. In any such action or proceeding, the
indemnified party shall have the right to retain its own counsel, but the fees
and expenses of such counsel shall be at its own expense unless (A) the
indemnifying party and the indemnified party mutually agree to the retention of
such counsel or (B) the named parties to any such suit, action, or proceeding
(including any impleaded parties) include both the indemnifying party and the
indemnified party, and, in the reasonable judgment of the indemnified party,
representation of the indemnifying party and the indemnified party by the same
counsel would be inadvisable due to actual or potential differing or
conflicting interests between them.
(ii) The indemnified party shall have the right to settle or
compromise any claim or liability subject to indemnification under this Section,
and to be indemnified from and against all Losses resulting therefrom, unless
the indemnifying party, within twenty (20) calendar days after receiving notice
of the claim or liability in accordance with (i) above notifies the indemnified
party that it intends to defend against such claim or liability and undertakes
such defense.
(iii) Except as otherwise provided in (ii) above, an
indemnifying party shall not be liable under this Section for any settlement
effected without its consent (which shall not be unreasonably withheld or
delayed) of any claim or liability or proceeding for which indemnity may be
sought hereunder. The indemnifying party may settle any claim without the
consent of the indemnified party provided that such settlement or release does
not require any payment by, or impose any liability or obligation on, the
indemnified party or does not materially adversely affect the rights, duties or
obligations of the indemnified party hereunder or otherwise.
(d) The representations and warranties of the parties
contained herein shall survive for one (1) year from the date hereof. The
expiration of any representation or warranty or indemnification provided herein
shall not affect any claim thereon made by the giving of written notice by a
party to the other in the manner provided in subsection (c) above prior to the
date of such expiration. All covenants and agreements of the parties contained
herein shall survive indefinitely, except as otherwise expressly provided
herein.
12. Public Announcements. The parties hereto agree to coordinate
the release of public information relating to this Agreement and, except as
otherwise required by applicable law, rule or regulation, will not release any
information without the prior written consent of the other party hereto.
13. Brokers and Finders. Investor and NRC each represent and
warrant to the other that it has dealt with no broker or finder in connection
with this transaction. This representation shall survive the closing hereunder.
14. Assignability. Neither this Agreement nor any rights,
obligations or claims hereunder may be assigned, except that upon prior written
notice to NRC, Investor shall have the right to assign this Agreement and the
rights, obligations and claims hereunder to Jean-Raymond Boulle, or to any
entity controlled by Mr. Boulle, provided that Mr. Boulle thereafter continues
to remain in control of such entity (the terms "controlled" and "control" shall
have the meanings ascribed to them in Rule 12b-2 promulgated by the SEC under
the 1934 Act). Any partial assignment of this Agreement and the rights,
obligations and claims hereunder in conjunction with the transfer of some, but
not all of the Purchase Shares, shall not affect NRC's obligation under Section
1 of Exhibit C which shall be to effect one (1) and only one (1) registration
in the aggregate for all then-owned Purchase Shares at the demand of Investor.
15. Governing Law; Consent to Jurisdiction. This Agreement shall
be governed by and construed in accordance with the laws of New York without
regard to the conflicts-of-laws principles thereof. Each of the parties hereby
irrevocably (a) submits to the exclusive jurisdiction of, and agrees that any
action, suit or other proceeding at law, in equity or otherwise, shall only be
brought in the Supreme Court, New York County, or Federal District Court for
the Southern District of New York, for the purpose of any such suit, action or
other proceeding arising out of or based upon this Agreement or the
transactions contemplated hereby ("Action"); (b) waives, to the extent not
prohibited by applicable law, rule or regulation, and agrees not to assert, by
way of motion, as a defense or otherwise, in any such Action, any claim that
any such person is not subject personally to the jurisdiction of the
aforementioned courts, that its property is exempt or immune from attachment or
execution, that any such action brought in the aforementioned court is brought
in an inconvenient forum, that the venue of any such action brought in the
aforementioned court is improper, or that this Agreement, or the transactions
contemplated hereby enforced in or by such court, and (c) consents to service
of process in any such Action by recognized international courier service.
Nothing herein shall affect the right to serve process in any other manner
permitted by law.
16. Entire Agreement. This Agreement embodies the entire
understanding and agreement of the parties hereto in relation to the subject
matter hereof, and no promise, condition, representation or warranty, express
or implied, not herein set forth shall bind any party hereto. None of the terms
and conditions of this Agreement may be changed, modified, waived or cancelled
orally or otherwise except by a writing signed by the parties hereto,
specifying such change, modification, waiver or cancellation. A waiver at any
time of compliance with any of the terms and conditions of this Agreement shall
not be considered a modification, cancellation or waiver of such terms and
conditions of any preceding or succeeding breach thereof unless expressly so
stated.
17. Binding Effect. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns.
18. Notices. Any notice or other communication required or
desired to be given shall be in writing and shall be sent by facsimile with
confirming copy by recognized international courier service. Each such notice
shall be deemed given upon delivery by such courier service to the following
respective addresses, which any party may change as to such party upon ten (10)
days' notice to the other party:
To NRC: 8150 Washington Village Drive
Dayton, Ohio 45458
Facsimile No.: (513) 435-7285
With a copy to: Spitzer & Feldman P.C.
405 Park Avenue
New York, NY 10022-4405
Attn: Kenneth Gliedman, Esq.
Facsimile No.: (212) 838-7472
To Investor: Boulevard Royal 25B
L-2449
Luxembourg, Luxembourg
Attn: Ms. Martine Doyle
Facsimile No.: 011-352-222413
With a copy to: Coudert Brothers
1114 Avenue of the Americas
New York, NY 10036-7703
Attn: James C. Colihan, Esq.
Facsimile No.: (212) 626-4120
19. Further Assurances. At any time and from time to time after
the execution and delivery hereof, the parties agree to cooperate with each
other, to execute and deliver such other documents, instruments of transfer or
assignment, and do all such further acts and things as may be reasonably
required to carry out the transactions contemplated hereunder.
20. Severability. The invalidity or unenforceability of any
particular provision of this Agreement or portions thereof, shall not affect
the other provisions or portions thereof, and this Agreement shall be construed
in all respects as if any such invalid or unenforceable provisions or portions
thereof were omitted.
21. No Third Party Beneficiaries. Nothing in this Agreement
will be construed as giving any person, firm, corporation or other entity,
other than the parties hereto and their successors and permitted assigns, any
right, remedy or claim under or in respect of this Agreement or any provision
hereof.
22. Headings. The headings in this Agreement are included for
convenience of reference only and shall not in any way affect the meaning or
interpretation of this Agreement.
23. Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original, but all of
which together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
NORD RESOURCES CORPORATION
By:
MIL (INVESTMENTS) S.A.
By:
Ekehart Kessel, Administrator
By:
Edmond Van de Kleft, Administrator
EXHIBIT A
TO
STOCK PURCHASE AND SALE AGREEMENT
THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE:
(I) HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED ("1933 ACT") OR THE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER
JURISDICTION; AND (II) MAY NOT BE OFFERED, SOLD OR DELIVERED
WITHIN THE UNITED STATES, OR TO OR FOR THE ACCOUNT OR BENEFIT
OF ANY U.S. PERSON (AS DEFINED BELOW) WITHIN FORTY (40) DAYS
AFTER THE DATE OF THIS CERTIFICATE, EXCEPT IN ACCORDANCE WITH
REGULATION S PROMULGATED BY THE UNITED STATES SECURITIES AND
EXCHANGE COMMISSION UNDER THE 1933 ACT ("REG S"). "U.S.
PERSON" SHALL HAVE THE MEANING ASCRIBED TO IT IN REGULATION
902(O) UNDER REG S.
EXHIBIT B
MAX BOULLE
MARC FRANKLIN
EXHIBIT C TO STOCK PURCHASE AND SALE AGREEMENT
REGISTRATION AND "PIGGY-BACK" REGISTRATION RIGHTS
ALL DEFINED TERMS USED HEREIN WHICH ARE NOT OTHERWISE DEFINED SHALL
HAVE THE MEANINGS ASCRIBED TO THEM IN THE STOCK PURCHASE AND SALE
AGREEMENT TO WHICH THIS EXHIBIT IS ATTACHED.
1. Demand Registration. (a) Subject to Section 1(b) and Section 3
below, at any time after the date hereof if at the time Investor (or the
successors and permitted assigns of Investor, who for purposes of this Exhibit C
shall be deemed to be included within the term "Investor") shall hold of record
collectively at least 500,000 shares of unregistered Common Stock, Investor (or,
if there are one or more permitted assignees of Investor, persons holding a
majority of the Purchase Shares) shall have the right to cause NRC to effect a
registration under the 1933 Act of such Purchase Shares for an underwritten
public offering of all or part of such Purchase Shares (collectively,
"Registrable Securities") by delivering written notice of its demand to cause
NRC to effect such a registration to NRC, specifying the number of shares of
Registrable Securities to be included in such registration and the intended
method of distribution thereof (the "Demand Registration Request"). NRC shall,
as expeditiously as possible under the circumstances, use its best efforts to
effect the registration under the 1933 Act and to effect any notification,
registration or qualification under any applicable state securities law of the
Registrable Securities which NRC has been so requested to register in the Demand
Registration Request for disposition in accordance with the intended method of
disposition stated in the Demand Registration Request (except that NRC shall not
be obligated to list any of its securities on any additional stock exchange or
register or comply with any laws, rules or regulations of any foreign government
or agency) and all to the extent necessary to permit the sale or other
disposition by Investor of Registrable Securities to be so registered in
accordance with the method of distribution set forth in the Demand Registration
Request.
(b) The demand registration rights granted in Section 1(a)
above are subject to the following limitations: (i) NRC shall not be obligated
to effect more than one (1) registration statement under this Section 1
(regardless of whether Investor has assigned all or any of its rights under the
Stock Purchase and Sale Agreement in accordance with the terms thereof to one or
more entities that Investor controls) and (ii) any such offering and sale of the
Registrable Securities pursuant to such registration shall be pursuant to a firm
commitment underwriting agreement.
(c) Subject to Section 3 below, NRC may elect to include in
any registration statement and offering made pursuant to this Section 1
authorized unissued NRC Shares or NRC Shares held by NRC as treasury shares;
provided, that such NRC Shares shall be permitted to be included in such
registration only to the extent that it is pursuant to and subject to the terms
of the underwriting agreement or arrangements entered into by the Investor
exercising the demand registration rights granted under this Section 1.
2. "Piggy-Back" Registrations. If at any time NRC proposes to
register any of its equity securities under the 1933 Act on a registration
statement for purposes of a sale by NRC of such equity securities for its own
account, whether in connection with a public offering by NRC, a public offering
by stockholders, or both, including, without limitation, by means of any
shelf registration pursuant to Rule 415 under the 1933 Act or any similar rule
or regulation (other than a registration on Form S-8 or any successor or similar
form then in effect and other than a registration pursuant to Section 1 hereof),
each such time NRC shall give prompt written notice (the "NRC Notice") of its
intention so to do to Investor if Investor holds of record any Registrable
Securities. Subject to Section 3, upon the written request of Investor given
within fifteen (15) days of the receipt of any such NRC Notice (which request
shall specify the Registrable Securities held of record intended to be disposed
of by Investor and the intended method of distribution thereof ("Investor's
Notice")), NRC will use its best efforts to effect the registration under the
1933 Act, and to include in such registration statement the number of shares of
Registrable Securities set forth in the Investor's Notice then owned by
Investor, as well as to include such Registrable Securities in any
notifications, registrations or qualifications under any state securities laws
which shall be made or obtained with respect to the equity securities being
registered by NRC, in each case to the extent necessary to permit the sale or
other disposition of the Registrable Securities to be so registered in
accordance with the method of distribution set forth in the Investor's Notice.
Investor shall have the right to withdraw a request to include Registrable
Securities in any registration statement to be filed pursuant to this Section 2
by giving written notice to NRC of its election to withdraw such request at
least ten (10) days prior to the proposed filing date of such registration
statement.
3. Allocation of Securities Included in Registration Statement. If
the managing underwriter for any offering pursuant to Section 1 or Section 2
above shall advise NRC and Investor in writing that the inclusion in any
registration effected pursuant to Section 1 or Section 2 of some or all of the
Registrable Securities, NRC Shares or NRC equity securities sought to be
registered pursuant thereto creates a substantial risk that the proceeds or the
price per unit NRC or Investor will derive from such registration will be
reduced or that the number of securities to be registered (including NRC Shares,
NRC equity securities and the Registrable Securities sought to be registered) is
too large a number to be reasonably sold, NRC will include NRC Shares, or NRC
equity securities, or Registrable Securities, as the case may be, in such
registration to the extent which NRC is so advised can be sold in such offering
based on the following priorities:
(a) if such registration is pursuant to Section 1 above,
a first priority shall be given to the Registrable
Securities held by Investor; a second priority shall
be given to NRC Shares sought to be registered by
NRC; and a third priority shall be given to any other
equity securities as to which NRC may in the future
grant registration rights; or
(b) if such registration is pursuant to Section 2 above,
a first priority shall be given to NRC Shares sought
to be registered by NRC; a second priority shall be
given to the Registrable Securities held by Investor
requested to be included in such registration; and a
third priority shall be given to any other equity
securities as to which NRC may in the future grant
registration rights.
4. Indemnification.
(a) In the event NRC effects any registration under the 1933
Act of any Registrable Securities pursuant to this Exhibit C, NRC shall
indemnify, to the extent permitted by law, and hold harmless Investor and any
underwriter, any officer, director, employee or agent of Investor or
underwriter, and each other person, if any, who controls Investor or underwriter
within the meaning of Section 15 of the 1933 Act, against any losses, claims,
damages or liabilities, joint or several, or actions in respect thereof
("Claims"), to which each such indemnified party becomes subject, under the 1933
Act or otherwise, insofar as such Claims arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
the registration statement or prospectus or any amendment or supplement thereto
or any document filed under a state securities or blue sky law (collectively,
"Registration Documents") or insofar as such Claims arise out of or are based
upon the omission or alleged omission to state in any Registration Document a
material fact required to be stated therein or necessary to make the statements
made therein not misleading, and will reimburse any such indemnified party for
any legal or other expenses reasonably incurred by such indemnified party in
investigating or defending any such Claim; provided, however, that NRC shall not
be liable to any such indemnified party in any such case to the extent such
Claim arises out of or is based upon an untrue statement or alleged untrue
statement of a material fact or omission or alleged omission of a material fact
made in any Registration Document in reliance upon and in conformity with
written information furnished to NRC by or on behalf of such indemnified party
specifically for use in such Registration Document.
(b) In connection with any registration statement in
which Investor is participating pursuant to this Exhibit C, Investor shall
indemnify, to the extent permitted by law, and hold harmless NRC, each of its
directors, each of its officers who have signed the registration statement, each
other person, if any, who controls NRC within the meaning of Section 15 of the
1933 Act, and each underwriter, and each other person, if any, who controls the
underwriter within the meaning of Section 15 of the 1933 Act, against any Claims
to which each such indemnified party may become subject under the 1933 Act or
otherwise, insofar as such Claims arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in any
Registration Document, or insofar as any Claims arise out of or are based upon
the omission or alleged omission to state in any Registration Document a
material fact required to be stated therein or necessary to make the statements
made therein not misleading, and will reimburse any such indemnified party for
any legal or other expenses reasonably incurred by such indemnified party in
investigating or defending any such claim; provided, however, that such
indemnification or reimbursement shall be payable only if, and to the extent
that, any such Claim arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in any
Registration Document in reliance upon and in conformity with written
information furnished to NRC by the Investor specifically for use in such
Registration Document and, provided further, that such indemnification or
reimbursement shall not apply if any such Claim arises out of or is based upon
an untrue statement or alleged untrue statement or omission or alleged omission
in such written information as a result of NRC's failure or refusal to address
any comments made by Investor under Section 5(a).
(c) Any person entitled to indemnification under Sections
4(a) or 4(b) above shall notify promptly the indemnifying party in writing of
the commencement of any Claim if a claim for indemnification in respect thereof
is to be made against an indemnifying party under this Section 4, but the
omission of such notice shall not relieve the indemnifying party from any
liability which it may have to any indemnified party otherwise than under
Section 4(a) or 4(b), except to the extent that such failure shall adversely
affect any indemnifying party or its rights hereunder. In case any action is
brought against the indemnified party and it shall notify the indemnifying party
of the commencement thereof, the indemnifying party shall be entitled to
participate in, and, to the extent that it chooses, to assume the defense
thereof with counsel reasonably satisfactory to the indemnified party; and,
after notice from the indemnifying party to the indemnified party that it so
chooses, the indemnifying party shall not be liable for any legal or other
expenses subsequently incurred by the indemnified party in connection with the
defense thereof other than reasonable costs of investigation; provided, however,
that (i) if the indemnifying party fails to take reasonable steps necessary to
defend diligently the Claim within twenty (20) days after receiving notice from
the indemnified party that the indemnified party believes it has failed to do
so; (ii) if the indemnified party who is a defendant in any action or proceeding
which is also brought against the indemnifying party reasonably shall have
concluded that there are legal defenses available to the indemnified party which
are not available to the indemnifying party; or (iii) if representation of both
parties by the same counsel is otherwise inappropriate under applicable
standards of professional conduct, the indemnified party shall have the right to
assume or continue its own defense as set forth above (but with no more than one
firm of counsel for all indemnified parties in each jurisdiction, except to the
extent any indemnified party or parties reasonably shall have concluded that
there are legal defenses available to such party or parties which are not
available to the other indemnified parties or to the extent representation of
all indemnified parties by the same counsel is otherwise inappropriate under
applicable standards of professional conduct) and the indemnifying party shall
be liable for any reasonable expenses therefor; provided, that no indemnifying
party shall be subject to any liability for any settlement of a Claim made
without its consent (which may not be unreasonably withheld, delayed or
conditioned). If the indemnifying party assumes the defense of any Claim
hereunder, such indemnifying party shall not enter into any settlement without
the consent of the indemnified party if such settlement attributes liability to
the indemnified party (which consent may not be unreasonably withheld, delayed
or conditioned).
(d) If for any reason the foregoing indemnity is
unavailable, or is insufficient to hold harmless, an indemnified party, then the
indemnifying party shall contribute to the amount paid or payable by the
indemnified party as a result of any Claim in such proportion as is appropriate
to reflect the relative benefits received by the indemnifying party on the one
hand and the indemnified party on the other from such offering of securities.
If, however, the allocation provided in the immediately preceding sentence is
not permitted by applicable law, or if the indemnified party failed to give the
notice required by Section 4 (c) above, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party in such
proportion as is appropriate to reflect not only such relative benefits but also
the relative fault of the indemnifying party and the indemnified party as well
as any other relevant equitable considerations. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the indemnifying party or by
the indemnified party and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The amount paid or payable in respect of any Claim shall be deemed to include
any legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such Claim. Notwithstanding the
foregoing, the Investor and any controlling person thereof, if any, shall not be
required to contribute any amount in excess of the amount by which the total
price at which the Registrable Securities sold by it and distributed to the
public were offered to the public exceeds the amount of any damages which the
Investor has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation.
(e) The provisions of this Section 4 shall be in addition
to any other rights to indemnification or contribution which any indemnified
party may have pursuant to law or contract and shall remain operative and in
full force and effect regardless of any investigation made or omitted by or on
behalf of any indemnified party and shall survive the transfer of the
Registrable Securities by any such party.
5. NRC Requirements With Respect to Registration. If and whenever
NRC is required by the provisions hereof to use its best efforts to register any
Registrable Securities under the 1933 Act, NRC shall, as expeditiously as
possible under the circumstances:
(a) Prepare and file with the SEC a registration
statement and any amendments or supplements thereto with respect to such
Registrable Securities and use its best efforts to cause such registration
statement to become and remain effective; provided, however, that before filing
with the SEC a registration statement or a prospectus or any amendments or
supplements thereto, NRC will (i) furnish to counsel selected by Investor copies
of all such documents proposed to be filed, which documents will be subject to
the review of such counsel (if the Registrable Securities to be included in a
registration statement are to be included pursuant to Section 2 above, such
counsel shall provide its comments, if any, within three (3) days after receipt
of such documents and such comments may or may not be addressed by NRC in its
sole and absolute discretion and the failure by counsel to timely deliver
comments shall be deemed to mean that counsel has no comments), and (ii) notify
Investor of any stop order issued or threatened by the SEC and take all
reasonable actions required to prevent the entry of such stop order or to remove
it if entered.
(b) Prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement current and to
comply with the provisions of the 1933 Act, and any regulations promulgated
thereunder, with respect to the sale or disposition of all Registrable
Securities covered by the registration statement required to effect the
distribution of the securities, including any period then permitted under Rule
415 promulgated by the SEC pursuant to the 1933 Act, but in no event shall NRC
be required to do so for a period of more than two (2) years following the
effective date of the registration statement (not including any period in which
sales of Registrable Securities cannot be made thereunder).
(c) Promptly notify the Investor of the effectiveness of
such registration statement.
(d) Furnish to the Investor copies (in reasonable
quantities) of such registration statement and each amendment and supplement
thereto; summary, preliminary, final, amended or supplemented prospectuses, in
conformity with the requirements of the 1933 Act and any regulations promulgated
thereunder; and other documents as reasonably may be requested by Investor in
order to facilitate the disposition of the securities, but only while NRC is
required under the provisions hereof to keep the registration statement current.
(e) Use its best efforts to register or qualify the
Registrable Securities covered by such registration statement under such other
securities or blue sky laws of such jurisdictions of the United States as the
Investor shall reasonably request, and do any and all other acts and things
which may be reasonably requested to enable Investor to consummate the
disposition of the Registrable Securities in such jurisdictions.
(f) Use its best efforts to cause such securities to be
registered to be listed on each securities exchange on which similar securities
issued by NRC are then listed.
(g) Enter into such customary agreements (including an
underwriting agreement in customary form) and take all such other actions as
Investor or the underwriters retained by Investor, if any, reasonably request in
order to expedite or facilitate the disposition of such securities to be
registered, including customary indemnification.
(h) Notify Investor at any time when a prospectus
relating to any such Registrable Securities covered by such registration
statement is required to be delivered under the 1933 Act, of the happening of
any event as a result of which the prospectus included in such registration
statement, as then in effect, includes an untrue statement of a material fact or
omits to state any material fact required to be stated therein or necessary to
make the statements therein not misleading in the light of the circumstances
then existing, and promptly prepare and furnish to Investor a reasonable number
of copies of a prospectus supplemented or amended so that, as thereafter
delivered to the purchasers of such Registrable Securities, such prospectus
shall not include an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading in the light of the circumstances then existing.
(i) As soon as practicable after the effective date of
the registration statement, and in any event within eighteen (18) months
thereafter, make generally available to Investor an earnings statement (which
need not be audited) covering a period of at least twelve (12) consecutive
months beginning after the effective date of the registration statement which
earnings statement shall satisfy the provisions of Section 11(a) of the 1933
Act, including, at NRC's option, Rule 158 thereunder. To the extent that NRC
files such information with the SEC in satisfaction of the foregoing, NRC need
not deliver the above referenced earnings statement to Investor.
(j) Upon request, deliver promptly to counsel of Investor
copies of all correspondence between the SEC and NRC, its counsel or auditors
and all memoranda relating to discussions with the SEC or its staff with respect
to the registration statement and permit Investor to do such investigation at
Investor's sole cost and expense, upon reasonable advance notice, with respect
to information contained in or omitted from the registration statement as it
deems reasonably necessary. Investor agrees that it will use its best efforts
not to interfere unreasonably with NRC's business when conducting any such
investigation.
(k) Provide a transfer agent and registrar located in the
United States for all such Registrable Securities covered by such registration
statement not later than the effective date of such registration statement.
(l) Pay all Registration Expenses incurred in connection
with a registration of Registrable Securities requested pursuant to this Exhibit
C, whether or not such registration statement shall become effective; provided
that Investor shall pay all underwriting discounts, commissions and transfer
taxes, if any, relating to the sale or disposition of Investor's Registrable
Securities pursuant to a registration statement requested pursuant to Section 1
above. As used herein, "Registration Expenses" means any and all reasonable and
customary expenses incident to performance of or compliance with the
registration rights set forth herein, including, without limitation, (i) all SEC
and stock exchange registration and filing fees, (ii) all fees and expenses of
complying with state securities or blue sky laws (including reasonable fees and
disbursements of counsel for the underwriters in connection with blue sky
qualifications of the Registrable Securities but no other expenses of the
underwriters or their counsel), (iii) all printing, messenger and delivery
expenses, and (iv) the reasonable fees and disbursements of counsel for NRC and
NRC's independent public accountants.
6. Specific Performance. NRC acknowledges that there is no adequate
remedy at law for failure by it to comply with the provisions of Section 1
through Section 5 and that such failure would not be adequately compensable in
damages, and therefore agrees that its agreements contained in Section 1 through
Section 5 may be specifically enforced.
7. Relation to Stock Purchase and Sale Agreement. This Exhibit C
shall be deemed to constitute a part of the Stock Purchase and Sale Agreement
for all purposes, all of the provisions of which shall be applicable with
respect to this Exhibit C.
AGREEMENT
BETWEEN
NORD RESOURCES CORPORATION
AND
MIL (INVESTMENTS) S.A.
April 15, 1996
THE SECURITIES TO WHICH THIS AGREEMENT RELATES HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED ("1933 ACT") AND MAY NOT BE OFFERED, SOLD
OR DELIVERED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF,
ANY U.S. PERSON (AS DEFINED HEREIN) PRIOR TO THE FORTY-FIRST DAY AFTER THE
CONVERSION DATE REFERRED TO HEREIN.
TABLE OF CONTENTS
PAGE #
1. The Loan................................................2
2. 1933 Act - Regulation S.................................3
3. Annual Stockholder Meeting..............................4
4. Information for Proxy Statement.........................5
5. Registration Rights.....................................5
7. Representations and Warranties of NRC...................6
8. Representations and Warranties of Lender...............10
9. Deliveries of NRC; Loan Conversion.....................12
10. Obligations of Lender..................................15
11. Indemnity; Survival. .................................16
12. Public Announcements...................................18
13. Brokers and Finders....................................18
14. Assignability. ........................................19
15. Governing Law; Consent to Jurisdiction.................19
16. Entire Agreement.......................................20
17. Binding Effect.........................................20
18. Notices................................................20
19. Further Assurances.....................................21
20. Severability...........................................21
21. No Third Party Beneficiaries...........................22
22. Headings...............................................22
23. Counterparts...........................................22
-i-
A G R E E M E N T
AGREEMENT ("Agreement") made this 15th day of April, 1996, by
and between NORD RESOURCES CORPORATION, a Delaware corporation ("NRC" or the
"Company"), having its principal place of business at 8150 Washington Village
Drive, Dayton, Ohio 45458 and MIL (INVESTMENTS) S.A., a Luxembourg corporation
(the "Lender"), having is principal place of business at Boulevard Royal 25B,
L-2449, Luxembourg, Luxembourg.
WHEREAS, NRC is a public company with its shares of common
stock, $.01 par value ("NRC Shares"), listed on the New York Stock Exchange
("NYSE"); and
WHEREAS, NRC desires to borrow from Lender, and Lender desires
to loan to NRC, the sum of $2,100,000 (the "Loan"), subject to the terms and
conditions set forth herein; and
WHEREAS, NRC and Lender desire to set forth herein their other
agreements and understandings.
NOW THEREFORE, in consideration of the premises and the mutual
covenants and conditions set forth herein and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, NRC
and Lender hereby agree as follows:
1. The Loan. (a) Lender hereby agrees to make the Loan to NRC and NRC
hereby agrees to borrow the amount of the Loan. The Loan has been made to NRC's
account at National City Bank, Dayton, Ohio, ABA# 042 200 279 (Account No.
767806130) simultaneously with the execution and delivery of this Agreement,
receipt of which is acknowledged by NRC, and NRC has executed an unsecured
promissory note in favor of Lender ("Note") evidencing the Loan, the form of
Note being annexed hereto as Exhibit A. Lender hereby acknowledges receipt of
the Note. The Note provides that, if not converted as described below, it will
bear interest at the rate of seven (7%) percent per annum, with the principal
and interest due and payable in full on April 15, 1997. Interest on the Loan
will accrue from the date of issuance, until paid, unless the Loan is converted
pursuant hereto. The Note provides that, in the event that the stockholders of
NRC (the "Stockholders") at the next annual meeting of Stockholders, approve
("Stockholder Approval") the conversion of the Loan into NRC Shares ("Loan
Conversion"), as required under Rule 312.00 of NYSE, and the NYSE approves
("NYSE Approval") the listing of the Conversion Shares (as defined below), the
Loan, immediately upon the latter of such Stockholder Approval or NYSE Approval,
as the case may be, will be converted into 840,000 NRC Shares ("Conversion
Shares") and the Loan, including all accrued interest thereon, will be
cancelled. The Loan Conversion will occur on the Conversion Date (as defined
under Section 9(b) below), provided that in no event shall the Conversion Date
be later than April 15, 1997. All references hereinafter to the "Conversion
Shares" assume that the Loan Conversion has taken place in accordance with the
terms of this Section 1 and Section 9(b).
(b) All amounts paid, transferred or issued to Lender pursuant to
this Agreement and the Note (including, without limitation in connection with
the Loan Conversion) shall be made free and clear of, and without any deduction
or withholding on account of, taxes imposed by the United States of America. If
NRC is required to make any deduction or withholding on account of any such tax,
then;
(i) the amount to be paid, transferred or issued to Lender shall
be increased to the extent necessary to ensure that after the making of that
deduction or withholding, Lender receives on a net after tax basis what it would
have received had no such withholding been required or made;
(ii) NRC shall indemnify Lender on an after tax basis against any
such tax and all claims, liabilities and related costs and expenses of Lender in
connection with the imposition or assertion of any such tax; and
(iii) Notwithstanding anything to the contrary contained in this
Section 1(b), if the Note is assigned in whole or in part and such deduction or
withholding is required from the amount to be paid, transferred or issued
pursuant to this Agreement or the Note (including, without limitation, in
connection with the Loan Conversion) to the assignee whereas it would not have
been required had it been paid, transferred or issued to the original Lender,
the provisions of this Section 1(b) shall not apply.
2. 1933 Act - Regulation S.
(a) The Conversion Shares are being offered and, if issued, will be
sold in an offshore transaction pursuant to Regulation S ("Regulation S")
promulgated by the Securities and Exchange Commission ("SEC") under the 1933
Act.
(b) The Conversion Shares have not been and will not be registered
under the 1933 Act, except as provided for in Section 5 below. Lender
acknowledges and agrees that from the Conversion Date until the forty-first
(41st) day after the Conversion Date (the "Restricted Period"), the Conversion
Shares may not be offered, sold or delivered within the United States or to, or
for the account or benefit of, any U.S.Person (as defined in Rule 902(o)
promulgated by the SEC under the 1933 Act), unless the Conversion Shares are
registered under the 1933 Act, or an exemption from the registration
requirements of the 1933 Act is available.
(c) Certificates representing the Conversion Shares during the
Restricted Period will contain a restrictive legend, the form of which is
annexed hereto as Exhibit B, prohibiting the offer, sale or delivery of the
Conversion Shares within the United States or to, or for the account or benefit
of, any U.S. Person during the Restricted Period.
3. Annual Stockholder Meeting. (a) NRC agrees to use its best efforts to
take all actions necessary to hold its annual meeting of Stockholders ("Annual
Meeting") on June 4, 1996, or the earliest possible date thereafter which
provides at least thirty (30) days between proxy mailing and the meeting date
("Meeting Date"), and to use its best efforts to obtain Stockholder Approval at
such meeting or any adjournment thereof. Such actions shall include, without
limitation, soliciting proxies for approval of the Loan Conversion and, in
connection therewith, recommending that Stockholders vote in favor of the
proposal seeking such approval. The Board of Directors of NRC have heretofore
unanimously approved the transactions contemplated under this Agreement,
including the Loan Conversion, and has unanimously resolved to recommend
approval of the Loan Conversion by NRC's Stockholders. NRC agrees to set the
record date for the annual meeting for April 16, 1996. The parties acknowledge
and understand that NRC must submit a preliminary proxy statement to the SEC for
review, which NRC intends to do within two (2) business days after the date of
this Agreement.
(b) During the period from the date hereof and continuing until the
Meeting Date or any adjournment or postponement thereof, NRC shall not (i)
offer, sell, contract to sell or otherwise issue or dispose of any NRC Shares or
any other securities of NRC, and any other securities that are convertible into
or exchangeable for or that represent the right to receive NRC Shares or any
other securities of NRC (other than pursuant to existing warrants, options and
other convertible securities as set forth in the Form 10-K), or (ii) announce or
effect any stock split, stock dividend, stock combination, reverse stock split,
stock reclassification or reorganization with respect to NRC Shares or any other
security of NRC.
4. Information for Proxy Statement. Concurrently herewith, Lender shall
provide information regarding its principals and affiliates as well as its
nominees to the Board (as provided for in the Stock Agreement (as defined
below)) to NRC and such other information as NRC shall reasonably request
(consistent with applicable SEC disclosure requirements) so that NRC can include
such information in its proxy statement (the information so provided being
referred to as the "Lender Proxy Information").
5. Registration Rights. NRC hereby grants to Lender the registration
rights and "piggy-back registration rights" regarding the Conversion Shares as
set forth on Exhibit C annexed hereto, all of which are incorporated herein by
reference.
6. New York Stock Exchange.
(a) NRC covenants and agrees to make application to list the
Conversion Shares with the NYSE immediately after Stockholder Approval has been
obtained.
(b) Promptly following the date hereof, NRC, in conjunction with
counsel for Lender, shall request in writing that the NYSE confirm that the
3,160,000 NRC Shares ("Other Shares") issued to Lender by NRC pursuant to that
certain Stock Purchase and Sale Agreement dated April 15, 1996 ("Stock
Agreement") may be voted by Lender at the Annual Meeting in favor of the Share
Conversion. Unless the NYSE objects to the Lender voting its Other Shares,
Lender shall vote the Other Shares in favor of the Share Conversion.
7. Representations and Warranties of NRC. NRC hereby represents and
warrants to Lender as of the date hereof, and, except as to subsections (d),
(g), (h) and (i) below, as of the Conversion Date, as follows:
(a) NRC is a corporation duly organized, validly
existing and in good standing under the laws
of the State of Delaware and has full
corporate power and authority to conduct its
business as now being conducted and to own
or lease the assets and properties it now
owns or holds under lease.
(b) NRC has full corporate power and authority
to execute and deliver this Agreement and to
execute the Note and, subject to obtaining
the Stockholder Approval and NYSE Approval,
to issue the Conversion Shares and to
consummate the transactions contemplated on
its part hereby.
(c) Prior to the date hereof, the Board of
Directors of NRC has duly approved this
Agreement and the Note and has duly
authorized the execution and delivery of
this Agreement and the Note and the
consummation of the transactions
contemplated hereby. This Agreement and the
Note have been duly executed and delivered
by NRC and constitute the legal, valid and
binding obligations of NRC enforceable in
accordance with their respective terms,
subject to bankruptcy, insolvency,
reorganization, fraudulent conveyance,
moratorium and similar laws of general
applicability relating to or affecting
creditors' rights and to general equity
principles (collectively, the
"Enforceability Exceptions"). The Conversion
Shares have been duly authorized by NRC and,
subject to the satisfaction of the
conditions set forth in Section 9(b) below,
will be validly issued, fully paid and
nonassessable.
(d) The authorized capital stock of NRC
consists of 25,000,000 NRC Shares,
15,838,408 NRC Shares being issued and
outstanding as of the date hereof (which
amount is being increased concurrently
herewith by the Other Shares) and 1,915,113
NRC Shares being reserved for issuance upon
the exercise of currently outstanding
options, warrants and other securities
convertible into NRC Shares, all of which
are described in the Form 10-K (as defined
below). All of the issued and outstanding
NRC Shares have been duly authorized and
validly issued and are fully paid and
nonassessable. Except as disclosed in the
Form 10-K, as of the date of this Agreement,
there are no preemptive rights, options,
warrants, calls, commitments or agreements
of any nature to which the Company or any
subsidiary or affiliate is a party or by
which any of them is bound calling for the
issuance or sale of shares of any class of
capital stock of NRC or securities
convertible into or exchangeable for shares
of such capital stock. As of the date of
this Agreement, neither the Company nor any
of its subsidiaries or affiliates is a party
to or otherwise bound by any agreement,
instrument or commitment for the issuance,
purchase or repurchase of any shares of
capital stock of the Company, or entitled to
the benefit of any option, right of first
refusal or other elective privilege to
purchase any shares of capital stock of the
Company. Neither NRC nor any of its
subsidiaries or affiliates has heretofore
granted to any person (i) the right to cause
NRC to register any NRC Shares beneficially
owned by such person under the 1933 Act or
(ii) the right to include any NRC Shares
beneficially owned by such person in any
registration statement filed by NRC under
the 1933 Act.
(e) Neither the execution and delivery of this
Agreement or the Note by NRC, nor the
consummation of the transactions
contemplated herein or therein, will, with
or without notice and/or the passage of
time, or both, (i) violate or result in a
breach of or constitute a default under
NRC's certificate of incorporation or
by-laws, (ii) violate any statute,
ordinance, rule, regulation, order or decree
of any court or of any public or
governmental body, agency or authority
applicable to the Company or any subsidiary
or affiliate of the Company or by which any
of their respective properties or assets may
be bound, the violation of which could
result in or reasonably be expected to have
a material adverse effect on the business,
financial condition or results of operations
of NRC and its subsidiaries, taken as a
whole (" Material Adverse Effect"), (iii)
require any filing, declaration or
registration with, or permit, consent or
approval of, or the giving of any notice to,
any public or governmental body, agency or
authority, the failure of which could result
in a Material Adverse Effect, or (iv) result
in a violation or breach of, or constitute a
default (or give rise to any right of
termination, cancellation or acceleration)
under any of the terms, conditions or
provisions of any note, bond, mortgage or
other evidence of indebtedness, indenture,
license, permit, concession, agreement or
other instrument or obligation to which the
Company or any subsidiary or affiliate is a
party, or by which any of them or any of
their respective properties or assets may be
bound, which could result in a Material
Adverse Effect.
(f) Subject to Stockholder Approval, NYSE
Approval and compliance with Section 9(b)
below, NRC has the absolute right, power,
and authority to sell the Conversion Shares
so as to vest in Lender complete and
absolute title to the Conversion Shares free
and clear of any lien, encumbrance, charge
or claim and to execute, deliver and carry
out the terms and provisions of this
Agreement without the approval or consent of
any third party. At the Conversion Closing
(as defined below), the Company will deliver
to the Lender good and valid title to the
Conversion Shares, free and clear of all
liens, security interests, options, charges,
beneficial interests, claims and
encumbrances of any kind, except for
restrictions on transfer imposed by this
Agreement and under applicable securities
laws.
(g) NRC has delivered to Lender a copy of its
Annual Report on Form 10-K for the year
ending December 31, 1995 (including exhibits
and any amendments thereto) filed with the
SEC ("Form 10-K"). As of their respective
dates, neither the Form 10-K nor, to the
best of knowledge of the executive officers
of NRC, any other securities law filing made
by NRC with the SEC since January 1, 1994,
contained any untrue statement of a material
fact or omitted to state a material fact
required to be stated therein or necessary
to make the statements made therein, in
light of the circumstances in which they
were made, not misleading in any material
respect. Except as disclosed in the Form
10-K, since December 31, 1995, (i) there has
not been any change, or any development
involving a prospective change, which has
had or could reasonably be expected to have
a Material Adverse Effect, (ii) NRC and its
subsidiaries have conducted their business
only in, and have not engaged in any
transaction other than in the ordinary
course and consistent with past practices
prior to such date, and (iii) there has been
no material change in any accounting
principles or practices of NRC. Other than
the business of NRC disclosed in the Form
10-K, NRC is not engaged in any other
business that is material to its financial
condition or results of operations. The Form
10-K discloses all defaults under contracts,
agreements and instruments to which NRC or
its subsidiaries are a party, where such
defaults could have a Material Adverse
Effect.
(h) There are no suits, actions, claims,
proceedings or investigations pending or, to
the best knowledge of the Company,
threatened against, relating to or involving
the Company or any subsidiary or affiliate
of the Company or any properties or rights
of the Company or any subsidiary or
affiliate, before any court, arbitrator or
administrative or governmental body,
domestic or foreign, which if adversely
determined would have a Material Adverse
Effect. There are no such suits, actions,
claims, proceedings or investigations
pending or, to the best knowledge of the
Company, threatened challenging the validity
or propriety of the transactions
contemplated by this Agreement.
(i) Neither the Company nor any subsidiary or
affiliate of the Company is in violation of
or in default in any respect under, the
applicable statutes, ordinances, rules,
regulations, orders or decrees of all
federal, state, local and foreign
governmental bodies, agencies and
authorities having, asserting or claiming
jurisdiction over any of them or over any
part of their operations or assets, except
for such violations and defaults which
individually or in the aggregate would not
have a Material Adverse Effect.
(j) The Company is not an investment company, or
a company controlled by an investment
company, within the meaning of the
Investment Company Act of 1940, as amended.
(k) The Company is a "reporting company" as
defined in Rule 902 of Regulation S. The
Company is in full compliance with all
filing obligations under Section 13 of the
Securities Exchange Act of 1934 as amended
("1934 Act"). The Company has not offered
the Conversion Shares to any person in the
United States, any identifiable groups of
U.S. citizens abroad, or to any U.S. Person.
In connection with the transactions
contemplated by this Agreement, the Company
has not conducted any "directed selling
efforts", as that term is defined in Rule
902 of Regulation S, nor has the Company
conducted any general solicitation relating
to the offer and sale of the Conversion
Shares to persons resident within the United
States or elsewhere.
(l) The transactions contemplated hereby do not
effect a "change of control" under any
material agreement to which NRC or any of
its subsidiaries or affiliates is a party.
8. Representations and Warranties of Lender. Lender hereby represents and
warrants to NRC as of the date hereof and as of the Conversion Date, as follows:
(a) Lender is a corporation duly organized,
validly existing and in good standing under
the laws of Luxembourg and has full
corporate power and authority to conduct its
business as now being conducted and to own
or lease the assets and properties it now
owns or holds under lease.
(b) Lender has full corporate power and
authority to execute and deliver this
Agreement and to make the Loan and to
consummate the transactions contemplated on
its part hereby.
(c) The Board of Directors (or equivalent) of
the Lender has duly approved this Agreement
and has duly authorized the execution and
delivery of this Agreement and the
consummation of the transactions
contemplated hereby. This Agreement has been
duly executed and delivered by Lender and
constitutes the legal, valid and binding
obligations of Lender enforceable in
accordance with its terms, subject to the
Enforceability Exceptions.
(d) Neither the execution and delivery of this
Agreement by Lender, nor the consummation of
the transactions herein contemplated, will,
with or without notice and/or the passage of
time, or both, (i) violate or result in a
breach of or constitute a default under its
organizational documents, (ii) violate any
statute, ordinance, rule, regulation, order
or decree of any court or of any public or
governmental body, agency or authority
applicable to the Lender or by which its
properties or assets may be bound, the
violation of which could result in or
reasonably be expected to have a material
adverse effect on the business, financial
condition or results of operation of Lender
and its subsidiaries, taken as a whole ("MIL
Material Adverse Effect"), (iii) require any
filing, declaration or registration with, or
permit, consent or approval of, or the
giving of any notice to, any public or
governmental body, agency or authority, the
failure of which could result in a MIL
Material Adverse Effect, or (iv) result in
violation or breach of, or constitute a
default (or give rise to any right of
termination, cancellation or acceleration)
under any of the terms, conditions or
provisions of any note, bond, mortgage or
other evidence of indebtedness, indenture,
license, permit, concession, agreement or
other instrument or obligation to which the
Lender is a party, or by which it or its
properties or assets may be bound, which
could result in a MIL Material Adverse
Effect.
(e) The Lender is neither a U.S. Person nor a
Distributor (as defined in Regulation 902(c)
promulgated by the SEC under the 1933 Act).
(f) Lender was outside of the United States at
the time the offer to sell the Conversion
Shares was made to the Lender and the Lender
was outside the United States at the time
the Lender executed this Agreement and will
be outside the United States on the
Conversion Date. The offer to sell the
Conversion Shares was directly communicated
to the Lender. At no time was the Lender
presented with or solicited by any leaflets,
newspaper or magazine article, radio or
television advertisement or any other form
of general advertising or solicited or
invited to attend a promotional meeting.
(g) The Lender has been advised that the sale of
the Conversion Shares to the Lender has not
been registered under the 1933 Act or
registered or qualified under state
securities laws, and that, until the
expiration of the Restricted Period, the
Conversion Shares may not be offered, sold
or delivered in the United States or to, or
for the account or benefit of, any U.S.
Person unless the Conversion Shares are
registered under the 1933 Act or an
exemption from the registration requirements
of the 1933 Act is available. The Lender
acknowledges that no representation,
warranty or guaranty, express or implied,
has been given to the Lender by NRC or any
officer, director, agent, or employee of,
legal counsel to, or any other person
connected with, NRC regarding the
availability at any time of an exemption
from registration under the 1933 Act for any
offer, sale or other transfer or disposition
of the Conversion Shares by the Lender; and
the Lender further understands and agrees
that the availability of any such exemption
from registration must be determined solely
by the Lender and the Lender's own legal
counsel based on the particular facts and
circumstances existing at the time of the
proposed transaction.
(h) The Lender has not offered or sold, and
agrees that it will not offer or sell, any
Conversion Shares directly or indirectly in
the United States or to, or for the benefit,
or account of, any U.S. Person prior to the
expiration of the Restricted Period, unless
the offer and sale of such Conversion Shares
is registered under the 1933 Act and any
applicable state securities laws, or
exemptions from the registration
requirements thereof are available; and
that, thereafter, such Conversion Shares may
be offered or sold in the United States or
to, or for the account or benefit of, any
U.S. Person only in compliance with the
registration requirements of the 1933 Act
and any applicable State Act, or pursuant to
available exemptions from such registration
requirements, or pursuant to the
requirements of Regulation S. The Lender
further represents and warrants that it will
not, through any short sale, long sale or
other hedging transaction, engage in any
transaction with the Conversion Shares prior
to the expiration of the Restricted Period
which would reduce the Lender's risk of
ownership or investment in the Conversion
Shares.
(i) Lender has received from NRC the Form 10-K
and has had access to the books and records,
officers, employees and properties of NRC
and its subsidiaries and affiliates and has
conducted its own due diligence in
connection with the transaction contemplated
by this Agreement.
(j) The Lender Proxy Information does not
contain any untrue statement of a material
fact or omit to state a material fact
required to be stated therein or necessary
to make the statements made therein, in
light of the circumstances in which they
were made, not misleading in any material
respect.
9. Deliveries of NRC; Loan Conversion. (a) Concurrently herewith, NRC
shall deliver to Lender the following:
(i) An original executed Note;
(ii) A secretary's certificate, certifying
resolutions of the Board which, among other
things, approve the execution and delivery
of this Agreement, the actions required
under Section 3 hereof and the carrying out
of the transactions contemplated hereby; and
(iii) an opinion of Spitzer & Feldman P.C.,
counsel to NRC, in form and substance
acceptable to Lender.
(b) The provisions of this Section 9(b) shall govern the procedures
whereby the Loan Conversion shall take place.
(i) NRC shall provide written notice to Lender
of the date on which the latter of the Stockholder Approval or the NYSE Approval
occurs. Such notice shall establish the time and place (the "Conversion
Closing") at which the following deliveries shall be made by the parties, all of
which shall be effected in a manner consistent with the requirements of
Regulation S.
(A) NRC. NRC shall make the following deliveries to
Lender at the Conversion Closing:
(1) An original executed and issued stock
certificate registered in the name of Lender
and representing the Conversion Shares,
which shall contain the legend set forth in
Exhibit A hereto;
(2) A certificate, duly executed by the
Chairman, Senior Vice President-Finance or
Secretary of NRC as to the absence of any
Event of Default (as defined in the Note);
and
(3) Evidence reasonably satisfactory to Lender
and its counsel that Stockholder Approval
and NYSE Approval have been obtained.
(B) Lender. Lender shall deliver the original executed
Note, duly marked "cancelled" to NRC at the
Conversion Closing.
(ii) Upon satisfaction by each party of the
foregoing conditions and deliveries, the Loan Conversion shall be deemed to have
occurred without the need for any further action by either party. The date on
which such Loan Conversion shall occur is referred to herein as the "Conversion
Date". Notwithstanding anything to the contrary herein, if an Event of Default
shall have occurred on or prior to the Conversion Date, the Loan Conversion
shall not occur unless Lender provides a further written notice to NRC at the
Conversion Closing pursuant to which Lender elects to proceed with the Loan
Conversion notwithstanding such Event of Default.
(iii) NRC represents and warrants that no
instructions restricting the free transferability of the Conversion Shares have
been, and NRC covenants and agrees that no such restrictions will be, lodged
with the transfer agent for the NRC Shares, other than a "stop transfer"
instruction to remain in force only until the end of the Restricted Period for
resales into the United States or to, or for the account or benefit of, any U.S.
Person, and that such Conversion Shares shall otherwise be freely transferable
on the books and records of NRC and such transfer agent. Upon surrender of the
initial certificates representing the Conversion Shares to NRC after expiration
of the Restricted Period, NRC shall promptly instruct its transfer agent to
issue one or more replacement certificates representing the Conversion Shares
without any restrictive legends thereon or "stop transfer" instructions
applicable thereto, in the name of Lender and in such denominations as Lender
shall specify. Nothing herein, however, shall affect in any way Lender's
obligations and agreements to comply with all securities laws upon resale of the
Conversion Shares.
(c) The parties hereto acknowledge and agree that the failure
of either party to comply timely with its obligations and agreements under
Section 9(b) of this Agreement will cause irreparable harm and injury to the
other party for which there is no adequate remedy at law. Therefore, either
party, in addition to any rights and/or remedies it may have at law, may
specifically enforce the terms and provisions of Section 9(b) of this Agreement.
(d) NRC hereby covenants and agrees to reserve, out of its
authorized but unissued share capital, a total of 840,000 NRC Shares, unless and
until (i) the rejection by the Stockholders of the Loan Conversion, (ii) the
refusal of the NYSE to list the Conversion Shares, or (iii) the election by
Lender to not proceed with conversion following an Event of Default.
10. Obligations of Lender. Concurrently herewith, Lender shall deliver to
NRC the following:
(a) The Loan by wire transfer of federal funds
to the account identified in Section 1
above by NRC; and
(b) A secretary's certificate certifying the
resolutions of the board of directors of
Lender which, among other things approve the
execution and delivery of this Agreement and
the carrying out of the transactions
contemplated hereby.
11. Indemnity; Survival.
(a) NRC hereby agrees to indemnify, defend, save
and hold Lender harmless from and against any and all damage, liability, loss,
expense, assessment, judgment or deficiency of any nature whatsoever (including,
without limitation, reasonable attorneys' fees, other costs and expenses
incident to any suit, action or proceeding) (collectively, "Losses") incurred or
sustained by Lender which arise out of or result from any breach of any
representation, warranty or covenant of NRC contained herein; provided however,
that the indemnity with respect to any representation and warranty shall
terminate as of the first date, if any, on which such representation or warranty
ceases to survive pursuant to subsection (d) hereof.
(b) Lender hereby agrees to indemnify, defend,
save and hold NRC harmless from and against any and all Losses incurred or
sustained by NRC which arise out of or result from any breach of any
representation, warranty or covenant of Lender contained herein; provided,
however, that the indemnity with respect to any representation and warranty
shall terminate as of the first date, if any, on which such representation or
warranty ceases to survive pursuant to subsection (d) hereof.
(c)(i) Promptly after the assertion of any claim
or the commencement of any action or proceeding with respect to any Loss for
which indemnity is provided pursuant to this Section, the party seeking such
indemnification shall notify the indemnifying party of such assertion or
proceeding; provided, however, that the failure promptly to give such notice
shall not affect any indemnified party's rights hereunder except to the extent
that such failure shall adversely affect any indemnifying party or its rights
hereunder in any material respect. The indemnified party shall advise the
indemnifying party of all material facts relating to such assertion within the
knowledge of the indemnified party, and shall afford the indemnifying party the
opportunity, at the indemnifying party's sole cost and expense, to defend
against such claims for liability. In any such action or proceeding, the
indemnified party shall have the right to retain its own counsel, but the fees
and expenses of such counsel shall be at its own expense unless (A) the
indemnifying party and the indemnified party mutually agree to the retention of
such counsel or (B) the named parties to any such suit, action, or proceeding
(including any impleaded parties) include both the indemnifying party and the
indemnified party, and, in the reasonable judgment of the indemnified party,
representation of the indemnifying party and the indemnified party by the same
counsel would be inadvisable due to actual or potential differing or conflicting
interests between them.
(ii) The indemnified party shall have the right to
settle or compromise any claim or liability subject to indemnification under
this Section, and to be indemnified from and against all Losses resulting
therefrom, unless the indemnifying party, within twenty (20) calendar days after
receiving notice of the claim or liability in accordance with (i) above notifies
the indemnified party that it intends to defend against such claim or liability
and undertakes such defense.
(iii) Except as otherwise provided in (ii) above,
an indemnifying party shall not be liable under this Section for any settlement
effected, without its consent (which shall not be unreasonably withheld or
delayed) of any claim or liability or proceeding for which indemnity may be
sought hereunder. The indemnifying party may settle any claim without the
consent of the indemnified party provided that such settlement or release does
not require any payment, or impose any liability or obligation on, by the
indemnified party or does not materially adversely affect the rights, duties or
obligations of the indemnified party hereunder or otherwise.
(d) The representations and warranties of the
parties contained herein shall survive for one (1) year from the date hereof.
The expiration of any representation or warranty or indemnification provided
herein shall not affect any claim thereon made by the giving of written notice
by a party to the other in the manner provided in subsection (c) above prior to
the date of such expiration. All covenants and agreements of the parties
contained herein shall survive indefinitely, except as otherwise provided
herein.
12. Public Announcements. The parties hereto agree to coordinate the
release of public information relating to this Agreement and, except as
otherwise required by applicable law, rule or regulation, will not release any
information without the prior written consent of the other party hereto.
13. Brokers and Finders. Lender and NRC each represent and warrant to the
other that it has dealt with no broker or finder in connection with this
transaction. This representation shall survive the closing hereunder.
14. Assignability. Neither this Agreement nor any rights, obligations or
claims hereunder may be assigned, except that upon prior written notice to NRC,
Lender shall have the right to assign this Agreement and the rights, obligations
and claims hereunder to Jean- Raymond Boulle, or to any entity controlled by Mr.
Boulle, provided that Mr. Boulle thereafter continues to remain in control of
such entity (the terms "controlled" and "control" shall have the meanings
ascribed to them in Rule 12b-2 promulgated by the SEC under the 1934 Act). Any
partial assignment of this Agreement and the rights, obligations and claims
hereunder in conjunction with the transfer of some, but not all of the
Conversion Shares, shall not affect NRC's obligation under Section 1 of Exhibit
C hereto.
15. Governing Law; Consent to Jurisdiction. This Agreement shall be
governed by and construed in accordance with the laws of New York without regard
to the conflicts-of-laws principles thereof. Each of the parties hereby
irrevocably (a) submits to the exclusive jurisdiction of, and agrees that any
action, suit or other proceeding at law, in equity or otherwise, shall only be
brought in the Supreme Court, New York County, or Federal District Court for the
Southern District of New York, for the purpose of any such suit, action or other
proceeding arising out of or based upon this Agreement or the transactions
contemplated hereby ("Action"); (b) waives, to the extent not prohibited by
applicable law, rule or regulation, and agrees not to assert, by way of motion,
as a defense or otherwise, in any such Action, any claim that any such person is
not subject personally to the jurisdiction of the aforementioned courts, that
its property is exempt or immune from attachment or execution, that any such
action brought in the aforementioned court is brought in an inconvenient forum,
that the venue of any such action brought in the aforementioned court is
improper, or that this Agreement, or the transactions contemplated hereby
enforced in or by such court, and (c) consents to service of process in any such
Action by recognized international courier service. Nothing herein shall affect
the right to serve process in any other manner permitted by law.
16. Entire Agreement. This Agreement embodies the entire understanding and
agreement of the parties hereto in relation to the subject matter hereof, and no
promise, condition, representation or warranty, express or implied, not herein
set forth shall bind any party hereto. None of the terms and conditions of this
Agreement may be changed, modified, waived or cancelled orally or otherwise
except by a writing signed by the parties hereto, specifying such change,
modification, waiver or cancellation. A waiver at any time of compliance with
any of the terms and conditions of this Agreement shall not be considered a
modification, cancellation or waiver of such terms and conditions of any
preceding or succeeding breach thereof unless expressly so stated.
17. Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted
assigns.
18. Notices. Any notice or other communication required or desired to be
given shall be in writing and shall be sent by facsimile with confirming copy by
recognized international courier service. Each such notice shall be deemed given
upon delivery by such courier service to the following respective addresses,
which any party may change as to such party upon ten (10) days' notice to the
other party:
To NRC: 8150 Washington Village Drive
Dayton, Ohio 45458
Facsimile No.: (513) 435-7285
With a copy to: Spitzer & Feldman P.C.
405 Park Avenue
New York, NY 10022-4405
Attn: Kenneth Gliedman, Esq.
Facsimile No.: (212) 838-7472
To Lender: Boulevard Royal 25B
L-2449
Luxembourg, Luxembourg
Attn: Ms. Martine Doyle
Facsimile No.: 011-352-222413
With a copy to: Coudert Brothers
1114 Avenue of the Americas
New York, NY 10036-7703
Attn: James C. Colihan, Esq.
Facsimile No.: (212) 626-4120
19. Further Assurances. At any time and from time to time after the
execution and delivery hereof, the parties agree to cooperate with each other,
to execute and deliver such other documents, instruments of transfer or
assignment, and do all such further acts and things as may be reasonably
required to carry out the transactions contemplated hereunder.
20. Severability. The invalidity or unenforceability of any particular
provision of this Agreement or portions thereof, shall not affect the other
provisions or portions thereof, and this Agreement shall be construed in all
respects as if any such invalid or unenforceable provisions or portions thereof
were omitted.
21. No Third Party Beneficiaries. Nothing in this Agreement will be
construed as giving any person, firm, corporation or other entity, other than
the parties hereto and their successors and permitted assigns, any right, remedy
or claim under or in respect of this Agreement or any provision hereof.
22. Headings. The headings in this Agreement are included for convenience
of reference only and shall not in any way affect the meaning or interpretation
of this Agreement.
23. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the day and year first above written.
NORD RESOURCES CORPORATION
By:
MIL (INVESTMENTS) S.A.
By:
Ekehart Kessel, Administrator
By:
Edmond Van de Kleft, Administrator
PROMISSORY NOTE
US$2,100,000.00 April 15, 1996
FOR VALUE RECEIVED, the undersigned NORD RESOURCES CORPORATION
(the "Maker"), a corporation duly organized and existing under the laws of the
State of Delaware, hereby promises to pay to the order of MIL (INVESTMENTS) S.A.
(the "Payee"), at Boulevard Royal 25B, L-2449, Luxembourg, Luxembourg, or at
such other place as the Payee may direct by written notice to Maker, the
principal sum of Two Million One Hundred Thousand ($2,100,000.00) United States
Dollars, with interest at the rate of seven (7%) percent per annum ("Interest
Rate").
Interest on this Note at the Interest Rate shall accrue and be computed
from the date hereof until the date of payment of the principal balance hereof,
and be due and payable, together with the principal balance of this Note, on
April 15, 1997. Payment of principal and interest on this Note shall be made
upon the surrender of this Note at the office of Maker at 8150 Washington
Village Drive, Dayton, Ohio 45458, by wire transfer of immediately available
funds to the account of the Payee as designated by Payee in writing to Maker.
This Note is being given pursuant to that certain Agreement dated April
15, 1996 between Maker and Payee ("Agreement").
Subject to, and upon compliance with the provisions of Section 9(b) of
the Agreement, this Note shall automatically be converted in whole into 840,000
fully paid and non-assessable shares of the common stock, $.01 par value (the
"Common Stock"), of Maker (the "Conversion Shares"), subject to adjustments from
time to time to take account of any stock splits, stock dividends, stock
combinations, reverse splits, stock reclassification or reorganization by Maker
or the merger of Maker with or into any other entity which occur prior to the
Conversion Date (as defined in the Agreement). Subject to compliance with
Section 9(b) of the Agreement, such conversion shall occur upon the later of:
(a) the approval of such conversion by the stockholders of Maker as required
under the rules of the New York Stock Exchange ("NYSE") and (b) the listing of
such Conversion Shares on the NYSE, provided that in no event shall such
conversion occur later than April 15, 1997.
Maker's delivery to Payee of the fixed number of shares of Common Stock
into which this Note is convertible will cancel Maker's obligation to pay the
principal amount of this Note, plus accrued interest, for the period from the
issue date of this Note to the Conversion Date.
Upon the conversion of this Note into Conversion Shares, and
contemporaneously with the delivery of the Conversion Shares to Payee, Payee
shall surrender this Note, marked "cancelled", at the Conversion Closing (as
defined in the Agreement).
Subject to Section 9(b) of the Agreement, this Note shall be deemed to
have been converted immediately prior to the close of business on the Conversion
Date, and at such time the rights of Payee as holder shall cease, and Payee
shall be treated for all purposes as the record holder of the Conversion Shares
at such time.
All shares of Common Stock delivered upon such conversion of this Note
shall bear a restrictive legend as set forth on Exhibit A annexed to the
Agreement and such shares of Common Stock shall be subject to the restrictions
on transfer provided in such legend.
If an Event of Default (as hereinafter defined) occurs or is
continuing, then the Payee may declare the principal and interest accrued on the
principal balance of this Note to be due and payable immediately, by a notice in
writing to Maker, and upon any such declaration such principal and interest
shall become immediately due and payable. If an Event of Default specified in
paragraphs (b) or (c) of the definition of "Event of Default" below occurs, the
principal of, and accrued interest thereon, this Note shall ipso facto become
immediately due and payable without any declaration or other act by any person.
Maker hereby agrees to pay all reasonable costs and expenses of Payee
(including, without limitation, reasonable attorneys' fees) in connection with
any collection proceeding relating to this Note. In addition to the foregoing
and notwithstanding anything to the contrary contained in this Note, if the
Conversion Date occurs on or after an Event of Default, this Note shall only be
converted into Conversion Shares at the election of the Payee as further
provided in Section 9(b) of the Agreement.
For purposes hereof, each of the following events shall constitute an
"Event of Default":
(a) default in the payment of the principal and accrued interest
of this Note at its maturity;
(b) the entry of a decree or order by a court having jurisdiction
in the premises adjudging Maker a bankrupt or insolvent, or
approving as properly filed a petition seeking reorganization,
arrangement, adjustment or composition of or in respect of
Maker under Federal bankruptcy law or any other applicable
Federal or state law, or appointing a receiver, liquidator,
assignee, trustee, sequestrator or other similar official of
Maker or of any substantial part of its property, or ordering
the winding up or liquidation of its affairs, and the
continuance of any such decree or order unstayed and in effect
for a period of thirty (30) consecutive days; or
(c) the institution by Maker of proceedings to be adjudicated a
bankrupt or insolvent, or the consent by it to the institution
of bankruptcy or insolvency proceedings against it, or the
filing by it of a petition or answer or consent seeking
reorganization or relief under Federal bankruptcy law or any
other applicable Federal or state law, or the consent by it to
the filing of such petition or to the appointment of a
receiver, liquidator, assignee, trustee, sequestrator or
similar official of Maker or of any substantial part of its
property, or the making by it of an assignment for the benefit
of creditors, or the admission by it in writing of its
inability to pay its debts generally as they become due, or
the taking of corporate action by Maker in furtherance of any
such action.
All payments hereunder shall be made in lawful money of the United
States of America.
All amounts paid, transferred or issued to Payee pursuant to the
Agreement and this Note (including, without limitation, in connection with the
Loan Conversion) shall be made free and clear of, and without any deduction or
withholding on account of, taxes imposed by the United Sates of America. If
Maker is required to make any deduction or withholding on account of any such
tax then:
(i) the amount to be paid, transferred o issued to Payee shall be
increased to the extent necessary to ensure that after the making of that
deduction or withholding, Payee receives on a net after tax basis what it would
have received had no such withholding been required or made; and
(ii) Maker shall indemnify Payee on an after tax basis against
any such tax and all claims, liabilities and related costs and expenses of Payee
in connection with the imposition or assertion of any such tax.
Notwithstanding anything to the contrary contained in this Note, if the Note is
assigned in whole or in part and such deduction or withholding is required from
the amount to be paid, transferred or issued pursuant to the Agreement and this
Note (including, without limitation, in connection with the Loan Conversion) to
the assignee whereas it would not have been required had it been paid,
transferred or issued to the original Payee, the provisions of this paragraph
shall not apply.
Neither this Note nor any rights, obligations or claims hereunder may
be assigned, except that upon prior written notice to Maker, Payee shall have
the right to assign this Note and the rights, obligations and claims hereunder
to Jean-Raymond Boulle, or to any entity controlled by Mr. Boulle, provided that
Mr. Boulle thereafter continues to remain in control of such entity (the terms
"controlled" and "control" shall have the meanings ascribed to them in Rule
12b-2 promulgated by the Securities and Exchange Commission under the Securities
Act of 1934, as amended).
Notwithstanding anything to the contrary contained in this Note,
neither this Note nor any rights, obligations or claims hereunder shall be
assigned at any time while this Note may be converted, subject to compliance
with Section 9(b) of the Agreement, to Conversion Shares, unless the proposed
assignee delivers an agreement to Maker in form and substance reasonably
acceptable to Maker whereby the proposed assignee makes the representations to
Maker set forth in Sections 8(e) to 8(i) of the Agreement.
This Note shall be governed by and construed in accordance with the
laws of the State of New York. Any provision hereof which may prove
unenforceable under any law shall not affect the validity of any other provision
hereof. The Maker hereby waives presentment, demand for payment, notice of
dishonor, protest and notice of protest, and any or all other notices or demands
in connection with this Note. The liability of the Maker shall be unconditional
and shall not be in any manner affected by any indulgence whatsoever granted or
consented by the Payee, including, but not limited to, any extension of time,
renewal, waiver or other modification. Any failure of the Payee to exercise any
right hereunder shall not be construed as a waiver of the right to exercise the
same or any other right at any time and from time to time thereafter.
NORD RESOURCES CORPORATION
By: _________________________________
Name: Edgar F. Cruft
Title: Chairman
EXHIBIT B
TO
AGREEMENT
THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE:
(I) HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED ("1933 ACT") OR THE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER
JURISDICTION; AND (II) MAY NOT BE OFFERED, SOLD OR DELIVERED
WITHIN THE UNITED STATES, OR TO OR FOR THE ACCOUNT OR BENEFIT
OF ANY U.S. PERSON (AS DEFINED BELOW) WITHIN FORTY (40) DAYS
AFTER THE DATE OF THIS CERTIFICATE, EXCEPT IN ACCORDANCE WITH
REGULATION S PROMULGATED BY THE UNITED STATES SECURITIES AND
EXCHANGE COMMISSION UNDER THE 1933 ACT ("REG S"). "U.S.
PERSON" SHALL HAVE THE MEANING ASCRIBED TO IT IN REGULATION
902(O) UNDER REG S.
EXHIBIT C TO AGREEMENT
REGISTRATION AND "PIGGY-BACK" REGISTRATION RIGHTS
ALL DEFINED TERMS USED HEREIN WHICH ARE NOT OTHERWISE DEFINED SHALL
HAVE THE MEANINGS ASCRIBED TO THEM IN THE AGREEMENT TO WHICH THIS
EXHIBIT IS ATTACHED.
1. Demand Registration. (a) Subject to Section 1(b) and Section 3 below, at
any time after the date hereof if at the time Lender (or the successors and
permitted assigns of Lender, who for purposes of this Exhibit C shall be deemed
to be included within the term "Lender") shall hold of record collectively at
least 500,000 shares of unregistered Common Stock, Lender (or, if there are one
or more permitted assignees of Lender, persons holding a majority of the
Conversion Shares) shall have the right to cause NRC to effect a registration
under the 1933 Act of such Conversion Shares for an underwritten public offering
of all or part of such Conversion Shares (collectively, "Registrable
Securities") by delivering written notice of its demand to cause NRC to effect
such a registration to NRC, specifying the number of shares of Registrable
Securities to be included in such registration and the intended method of
distribution thereof (the "Demand Registration Request"). NRC shall, as
expeditiously as possible under the circumstances, use its best efforts to
effect the registration under the 1933 Act and to effect any notification,
registration or qualification under any applicable state securities law of the
Registrable Securities which NRC has been so requested to register in the Demand
Registration Request for disposition in accordance with the intended method of
disposition stated in the Demand Registration Request (except that NRC shall not
be obligated to list any of its securities on any additional stock exchange or
register or comply with any laws, rules or regulations of any foreign government
or agency) and all to the extent necessary to permit the sale or other
disposition by Lender of Registrable Securities to be so registered in
accordance with the method of distribution set forth in the Demand Registration
Request.
(b) The demand registration rights granted in Section 1(a)
above can only be exercised concurrently with the exercise by Lender of the
registration rights granted to Lender by NRC pursuant to that certain Stock
Purchase and Sale Agreement dated April 15, 1996.
(c) Subject to Section 3 below, NRC may elect to include in
any registration statement and offering made pursuant to this Section 1
authorized unissued NRC Shares or NRC Shares held by NRC as treasury shares;
provided, that such NRC Shares shall be permitted to be included in such
registration only to the extent that it is pursuant to and subject to the terms
of the underwriting agreement or arrangements entered into by the Lender
exercising the demand registration rights granted under this Section 1.
2. "Piggy-Back" Registrations. If at any time NRC proposes to register any
of its equity securities under the 1933 Act on a registration statement for
purposes of a sale by NRC of such equity securities for its own account, whether
in connection with a public offering by NRC, a public offering by stockholders,
or both, including, without limitation, by means of any shelf registration
pursuant to Rule 415 under the 1933 Act or any similar rule or regulation (other
than a registration on Form S-8 or any successor or similar form then in effect
and other than a registration pursuant to Section 1 hereof), each such time NRC
shall give prompt written notice (the "NRC Notice") of its intention so to do to
Lender if Lender holds of record any Registrable Securities. Subject to Section
3, upon the written request of Lender given within fifteen (15) days of the
receipt of any such NRC Notice (which request shall specify the Registrable
Securities held of record intended to be disposed of by Lender and the intended
method of distribution thereof ("Lender's Notice")), NRC will use its best
efforts to effect the registration under the 1933 Act, and to include in such
registration statement the number of shares of Registrable Securities set forth
in the Lender's Notice then owned by Lender, as well as to include such
Registrable Securities in any notifications, registrations or qualifications
under any state securities laws which shall be made or obtained with respect to
the equity securities being registered by NRC, in each case to the extent
necessary to permit the sale or other disposition of the Registrable Securities
to be so registered in accordance with the method of distribution set forth in
the Lender's Notice. Lender shall have the right to withdraw a request to
include Registrable Securities in any registration statement to be filed
pursuant to this Section 2 by giving written notice to NRC of its election to
withdraw such request at least ten (10) days prior to the proposed filing date
of such registration statement.
3. Allocation of Securities Included in Registration Statement. If the
managing underwriter for any offering pursuant to Section 1 or Section 2 above
shall advise NRC and Lender in writing that the inclusion in any registration
effected pursuant to Section 1 or Section 2 of some or all of the Registrable
Securities, NRC Shares or NRC equity securities sought to be registered pursuant
thereto creates a substantial risk that the proceeds or the price per unit NRC
or Lender will derive from such registration will be reduced or that the number
of securities to be registered (including NRC Shares, NRC equity securities and
the Registrable Securities sought to be registered) is too large a number to be
reasonably sold, NRC will include NRC Shares, or NRC equity securities, or
Registrable Securities, as the case may be, in such registration to the extent
which NRC is so advised can be sold in such offering based on the following
priorities:
(a) if such registration is pursuant to Section 1 above,
a first priority shall be given to the Registrable
Securities held by Lender; a second priority shall be
given to NRC Shares sought to be registered by NRC;
and a third priority shall be given to any other
equity securities as to which NRC may in the future
grant registration rights; or
(b) if such registration is pursuant to Section 2 above,
a first priority shall be given to NRC Shares sought
to be registered by NRC; a second priority shall be
given to the Registrable Securities held by Lender
requested to be included in such registration; and a
third priority shall be given to any other equity
securities as to which NRC may in the future grant
registration rights.
4. Indemnification.
(a) In the event NRC effects any registration under the 1933
Act of any Registrable Securities pursuant to this Exhibit C, NRC shall
indemnify, to the extent permitted by law, and hold harmless Lender and any
underwriter, any officer, director, employee or agent of Lender or underwriter,
and each other person, if any, who controls Lender or underwriter within the
meaning of Section 15 of the 1933 Act, against any losses, claims, damages or
liabilities, joint or several, or actions in respect thereof ("Claims"), to
which each such indemnified party becomes subject, under the 1933 Act or
otherwise, insofar as such Claims arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in the
registration statement or prospectus or any amendment or supplement thereto or
any document filed under a state securities or blue sky law (collectively,
"Registration Documents") or insofar as such Claims arise out of or are based
upon the omission or alleged omission to state in any Registration Document a
material fact required to be stated therein or necessary to make the statements
made therein not misleading, and will reimburse any such indemnified party for
any legal or other expenses reasonably incurred by such indemnified party in
investigating or defending any such Claim; provided, however, that NRC shall not
be liable to any such indemnified party in any such case to the extent such
Claim arises out of or is based upon an untrue statement or alleged untrue
statement of a material fact or omission or alleged omission of a material fact
made in any Registration Document in reliance upon and in conformity with
written information furnished to NRC by or on behalf of such indemnified party
specifically for use in such Registration Document.
(b) In connection with any registration statement in
which Lender is participating pursuant to this Exhibit C, Lender shall
indemnify, to the extent permitted by law, and hold harmless NRC, each of its
directors, each of its officers who have signed the registration statement, each
other person, if any, who controls NRC within the meaning of Section 15 of the
1933 Act, and each underwriter, and each other person, if any, who controls the
underwriter within the meaning of Section 15 of the 1933 Act, against any Claims
to which each such indemnified party may become subject under the 1933 Act or
otherwise, insofar as such Claims arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in any
Registration Document, or insofar as any Claims arise out of or are based upon
the omission or alleged omission to state in any Registration Document a
material fact required to be stated therein or necessary to make the statements
made therein not misleading, and will reimburse any such indemnified party for
any legal or other expenses reasonably incurred by such indemnified party in
investigating or defending any such claim; provided, however, that such
indemnification or reimbursement shall be payable only if, and to the extent
that, any such Claim arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in any
Registration Document in reliance upon and in conformity with written
information furnished to NRC by the Lender specifically for use in such
Registration Document and, provided further, that such indemnification or
reimbursement shall not apply if any such Claim arises out of or is based upon
an untrue statement or alleged untrue statement or omission or alleged omission
in such written information as a result of NRC's failure or refusal to address
any comments made by Lender under Section 5(a).
(c) Any person entitled to indemnification under Sections
4(a) or 4(b) above shall notify promptly the indemnifying party in writing of
the commencement of any Claim if a claim for indemnification in respect thereof
is to be made against an indemnifying party under this Section 4, but the
omission of such notice shall not relieve the indemnifying party from any
liability which it may have to any indemnified party otherwise than under
Section 4(a) or 4(b), except to the extent that such failure shall adversely
affect any indemnifying party or its rights hereunder. In case any action is
brought against the indemnified party and it shall notify the indemnifying party
of the commencement thereof, the indemnifying party shall be entitled to
participate in, and, to the extent that it chooses, to assume the defense
thereof with counsel reasonably satisfactory to the indemnified party; and,
after notice from the indemnifying party to the indemnified party that it so
chooses, the indemnifying party shall not be liable for any legal or other
expenses subsequently incurred by the indemnified party in connection with the
defense thereof other than reasonable costs of investigation; provided, however,
that (i) if the indemnifying party fails to take reasonable steps necessary to
defend diligently the Claim within twenty (20) days after receiving notice from
the indemnified party that the indemnified party believes it has failed to do
so; (ii) if the indemnified party who is a defendant in any action or proceeding
which is also brought against the indemnifying party reasonably shall have
concluded that there are legal defenses available to the indemnified party which
are not available to the indemnifying party; or (iii) if representation of both
parties by the same counsel is otherwise inappropriate under applicable
standards of professional conduct, the indemnified party shall have the right to
assume or continue its own defense as set forth above (but with no more than one
firm of counsel for all indemnified parties in each jurisdiction, except to the
extent any indemnified party or parties reasonably shall have concluded that
there are legal defenses available to such party or parties which are not
available to the other indemnified parties or to the extent representation of
all indemnified parties by the same counsel is otherwise inappropriate under
applicable standards of professional conduct) and the indemnifying party shall
be liable for any reasonable expenses therefor; provided, that no indemnifying
party shall be subject to any liability for any settlement of a Claim made
without its consent (which may not be unreasonably withheld, delayed or
conditioned). If the indemnifying party assumes the defense of any Claim
hereunder, such indemnifying party shall not enter into any settlement without
the consent of the indemnified party if such settlement attributes liability to
the indemnified party (which consent may not be unreasonably withheld, delayed
or conditioned).
(d) If for any reason the foregoing indemnity is
unavailable, or is insufficient to hold harmless, an indemnified party, then the
indemnifying party shall contribute to the amount paid or payable by the
indemnified party as a result of any Claim in such proportion as is appropriate
to reflect the relative benefits received by the indemnifying party on the one
hand and the indemnified party on the other from such offering of securities.
If, however, the allocation provided in the immediately preceding sentence is
not permitted by applicable law, or if the indemnified party failed to give the
notice required by Section 4 (c) above, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party in such
proportion as is appropriate to reflect not only such relative benefits but also
the relative fault of the indemnifying party and the indemnified party as well
as any other relevant equitable considerations. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the indemnifying party or by
the indemnified party and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The amount paid or payable in respect of any Claim shall be deemed to include
any legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such Claim. Notwithstanding the
foregoing, the Lender and any controlling person thereof, if any, shall not be
required to contribute any amount in excess of the amount by which the total
price at which the Registrable Securities sold by it and distributed to the
public were offered to the public exceeds the amount of any damages which the
Lender has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation.
(e) The provisions of this Section 4 shall be in addition
to any other rights to indemnification or contribution which any indemnified
party may have pursuant to law or contract and shall remain operative and in
full force and effect regardless of any investigation made or omitted by or on
behalf of any indemnified party and shall survive the transfer of the
Registrable Securities by any such party.
5. NRC Requirements With Respect to Registration. If and whenever NRC is
required by the provisions hereof to use its best efforts to register any
Registrable Securities under the 1933 Act, NRC shall, as expeditiously as
possible under the circumstances:
(a) Prepare and file with the SEC a registration
statement and any amendments or supplements thereto with respect to such
Registrable Securities and use its best efforts to cause such registration
statement to become and remain effective; provided, however, that before filing
with the SEC a registration statement or a prospectus or any amendments or
supplements thereto, NRC will (i) furnish to counsel selected by Lender copies
of all such documents proposed to be filed, which documents will be subject to
the review of such counsel (if the Registrable Securities to be included in a
registration statement are to be included pursuant to Section 2 above, such
counsel shall provide its comments, if any, within three (3) days after receipt
of such documents and such comments may or may not be addressed by NRC in its
sole and absolute discretion and the failure by counsel to timely deliver
comments shall be deemed to mean that counsel has no comments), and (ii) notify
Lender of any stop order issued or threatened by the SEC and take all reasonable
actions required to prevent the entry of such stop order or to remove it if
entered.
(b) Prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement current and to
comply with the provisions of the 1933 Act, and any regulations promulgated
thereunder, with respect to the sale or disposition of all Registrable
Securities covered by the registration statement required to effect the
distribution of the securities, including any period then permitted under Rule
415 promulgated by the SEC pursuant to the 1933 Act, but in no event shall NRC
be required to do so for a period of more than two (2) years following the
effective date of the registration statement (not including any period in which
sales of Registrable Securities cannot be made thereunder).
(c) Promptly notify the Lender of the effectiveness of
such registration statement.
(d) Furnish to the Lender copies (in reasonable
quantities) of such registration statement and each amendment and supplement
thereto; summary, preliminary, final, amended or supplemented prospectuses, in
conformity with the requirements of the 1933 Act and any regulations promulgated
thereunder; and other documents as reasonably may be requested by Lender in
order to facilitate the disposition of the securities, but only while NRC is
required under the provisions hereof to keep the registration statement current.
(e) Use its best efforts to register or qualify the
Registrable Securities covered by such registration statement under such other
securities or blue sky laws of such jurisdictions of the United States as the
Lender shall reasonably request, and do any and all other acts and things which
may be reasonably requested to enable Lender to consummate the disposition of
the Registrable Securities in such jurisdictions.
(f) Use its best efforts to cause such securities to be
registered to be listed on each securities exchange on which similar securities
issued by NRC are then listed.
(g) Enter into such customary agreements (including an
underwriting agreement in customary form) and take all such other actions as
Lender or the underwriters retained by Lender, if any, reasonably request in
order to expedite or facilitate the disposition of such securities to be
registered, including customary indemnification.
(h) Notify Lender at any time when a prospectus relating
to any such Registrable Securities covered by such registration statement is
required to be delivered under the 1933 Act, of the happening of any event as a
result of which the prospectus included in such registration statement, as then
in effect, includes an untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading in the light of the circumstances then existing, and
promptly prepare and furnish to Lender a reasonable number of copies of a
prospectus supplemented or amended so that, as thereafter delivered to the
purchasers of such Registrable Securities, such prospectus shall not include an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading in
the light of the circumstances then existing.
(i) As soon as practicable after the effective date of
the registration statement, and in any event within eighteen (18) months
thereafter, make generally available to Lender an earnings statement (which need
not be audited) covering a period of at least twelve (12) consecutive months
beginning after the effective date of the registration statement which earnings
statement shall satisfy the provisions of Section 11(a) of the 1933 Act,
including, at NRC's option, Rule 158 thereunder. To the extent that NRC files
such information with the SEC in satisfaction of the foregoing, NRC need not
deliver the above referenced earnings statement to Lender.
(j) Upon request, deliver promptly to counsel of Lender
copies of all correspondence between the SEC and NRC, its counsel or auditors
and all memoranda relating to discussions with the SEC or its staff with respect
to the registration statement and permit Lender to do such investigation at
Lender's sole cost and expense, upon reasonable advance notice, with respect to
information contained in or omitted from the registration statement as it deems
reasonably necessary. Lender agrees that it will use its best efforts not to
interfere unreasonably with NRC's business when conducting any such
investigation.
(k) Provide a transfer agent and registrar located in the
United States for all such Registrable Securities covered by such registration
statement not later than the effective date of such registration statement.
(l) Pay all Registration Expenses incurred in connection
with a registration of Registrable Securities requested pursuant to this Exhibit
C, whether or not such registration statement shall become effective; provided
that Lender shall pay all underwriting discounts, commissions and transfer
taxes, if any, relating to the sale or disposition of Lender's Registrable
Securities pursuant to a registration statement requested pursuant to Section 1
above. As used herein, "Registration Expenses" means any and all reasonable and
customary expenses incident to performance of or compliance with the
registration rights set forth herein, including, without limitation, (i) all SEC
and stock exchange registration and filing fees, (ii) all fees and expenses of
complying with state securities or blue sky laws (including reasonable fees and
disbursements of counsel for the underwriters in connection with blue sky
qualifications of the Registrable Securities but no other expenses of the
underwriters or their counsel), (iii) all printing, messenger and delivery
expenses, and (iv) the reasonable fees and disbursements of counsel for NRC and
NRC's independent public accountants.
6. Specific Performance. NRC acknowledges that there is no adequate remedy
at law for failure by it to comply with the provisions of Section 1 through
Section 5 and that such failure would not be adequately compensable in damages,
and therefore agrees that its agreements contained in Section 1 through Section
5 may be specifically enforced.
7. Relation to Stock Purchase and Sale Agreement. This Exhibit C shall be
deemed to constitute a part of the Agreement for all purposes, all of the
provisions of which shall be applicable with respect to this Exhibit C.
PROMISSORY NOTE
US$2,100,000.00 April 15, 1996
FOR VALUE RECEIVED, the undersigned NORD RESOURCES CORPORATION
(the "Maker"), a corporation duly organized and existing under the laws of the
State of Delaware, hereby promises to pay to the order of MIL (INVESTMENTS) S.A.
(the "Payee"), at Boulevard Royal 25B, L-2449, Luxembourg, Luxembourg, or at
such other place as the Payee may direct by written notice to Maker, the
principal sum of Two Million One Hundred Thousand ($2,100,000.00) United States
Dollars, with interest at the rate of seven (7%) percent per annum ("Interest
Rate").
Interest on this Note at the Interest Rate shall accrue and be computed
from the date hereof until the date of payment of the principal balance hereof,
and be due and payable, together with the principal balance of this Note, on
April 15, 1997. Payment of principal and interest on this Note shall be made
upon the surrender of this Note at the office of Maker at 8150 Washington
Village Drive, Dayton, Ohio 45458, by wire transfer of immediately available
funds to the account of the Payee as designated by Payee in writing to Maker.
This Note is being given pursuant to that certain Agreement dated April
15, 1996 between Maker and Payee ("Agreement").
Subject to, and upon compliance with the provisions of Section 9(b) of
the Agreement, this Note shall automatically be converted in whole into 840,000
fully paid and non-assessable shares of the common stock, $.01 par value (the
"Common Stock"), of Maker (the "Conversion Shares"), subject to adjustments from
time to time to take account of any stock splits, stock dividends, stock
combinations, reverse splits, stock reclassification or reorganization by Maker
or the merger of Maker with or into any other entity which occur prior to the
Conversion Date (as defined in the Agreement). Subject to compliance with
Section 9(b) of the Agreement, such conversion shall occur upon the later of:
(a) the approval of such conversion by the stockholders of Maker as required
under the rules of the New York Stock Exchange ("NYSE") and (b) the listing of
such Conversion Shares on the NYSE, provided that in no event shall such
conversion occur later than April 15, 1997.
Maker's delivery to Payee of the fixed number of shares of Common Stock
into which this Note is convertible will cancel Maker's obligation to pay the
principal amount of this Note, plus accrued interest, for the period from the
issue date of this Note to the Conversion Date.
Upon the conversion of this Note into Conversion Shares, and
contemporaneously with the delivery of the Conversion Shares to Payee, Payee
shall surrender this Note, marked "cancelled", at the Conversion Closing (as
defined in the Agreement).
Subject to Section 9(b) of the Agreement, this Note shall be deemed to
have been converted immediately prior to the close of business on the Conversion
Date, and at such time the rights of Payee as holder shall cease, and Payee
shall be treated for all purposes as the record holder of the Conversion Shares
at such time.
All shares of Common Stock delivered upon such conversion of this Note
shall bear a restrictive legend as set forth on Exhibit A annexed to the
Agreement and such shares of Common Stock shall be subject to the restrictions
on transfer provided in such legend.
If an Event of Default (as hereinafter defined) occurs or is
continuing, then the Payee may declare the principal and interest accrued on the
principal balance of this Note to be due and payable immediately, by a notice in
writing to Maker, and upon any such declaration such principal and interest
shall become immediately due and payable. If an Event of Default specified in
paragraphs (b) or (c) of the definition of "Event of Default" below occurs, the
principal of, and accrued interest thereon, this Note shall ipso facto become
immediately due and payable without any declaration or other act by any person.
Maker hereby agrees to pay all reasonable costs and expenses of Payee
(including, without limitation, reasonable attorneys' fees) in connection with
any collection proceeding relating to this Note. In addition to the foregoing
and notwithstanding anything to the contrary contained in this Note, if the
Conversion Date occurs on or after an Event of Default, this Note shall only be
converted into Conversion Shares at the election of the Payee as further
provided in Section 9(b) of the Agreement.
For purposes hereof, each of the following events shall constitute an
"Event of Default":
(a) default in the payment of the principal and accrued interest
of this Note at its maturity;
(b) the entry of a decree or order by a court having jurisdiction
in the premises adjudging Maker a bankrupt or insolvent, or
approving as properly filed a petition seeking reorganization,
arrangement, adjustment or composition of or in respect of
Maker under Federal bankruptcy law or any other applicable
Federal or state law, or appointing a receiver, liquidator,
assignee, trustee, sequestrator or other similar official of
Maker or of any substantial part of its property, or ordering
the winding up or liquidation of its affairs, and the
continuance of any such decree or order unstayed and in effect
for a period of thirty (30) consecutive days; or
(c) the institution by Maker of proceedings to be adjudicated a
bankrupt or insolvent, or the consent by it to the institution
of bankruptcy or insolvency proceedings against it, or the
filing by it of a petition or answer or consent seeking
reorganization or relief under Federal bankruptcy law or any
other applicable Federal or state law, or the consent by it to
the filing of such petition or to the appointment of a
receiver, liquidator, assignee, trustee, sequestrator or
similar official of Maker or of any substantial part of its
property, or the making by it of an assignment for the benefit
of creditors, or the admission by it in writing of its
inability to pay its debts generally as they become due, or
the taking of corporate action by Maker in furtherance of any
such action.
All payments hereunder shall be made in lawful money of the United
States of America.
All amounts paid, transferred or issued to Payee pursuant to the
Agreement and this Note (including, without limitation, in connection with the
Loan Conversion) shall be made free and clear of, and without any deduction or
withholding on account of, taxes imposed by the United Sates of America. If
Maker is required to make any deduction or withholding on account of any such
tax then:
(i) the amount to be paid, transferred o issued to Payee shall be
increased to the extent necessary to ensure that after the making of that
deduction or withholding, Payee receives on a net after tax basis what it would
have received had no such withholding been required or made; and
(ii) Maker shall indemnify Payee on an after tax basis against
any such tax and all claims, liabilities and related costs and expenses of Payee
in connection with the imposition or assertion of any such tax.
Notwithstanding anything to the contrary contained in this Note, if the Note is
assigned in whole or in part and such deduction or withholding is required from
the amount to be paid, transferred or issued pursuant to the Agreement and this
Note (including, without limitation, in connection with the Loan Conversion) to
the assignee whereas it would not have been required had it been paid,
transferred or issued to the original Payee, the provisions of this paragraph
shall not apply.
Neither this Note nor any rights, obligations or claims hereunder may
be assigned, except that upon prior written notice to Maker, Payee shall have
the right to assign this Note and the rights, obligations and claims hereunder
to Jean-Raymond Boulle, or to any entity controlled by Mr. Boulle, provided that
Mr. Boulle thereafter continues to remain in control of such entity (the terms
"controlled" and "control" shall have the meanings ascribed to them in Rule
12b-2 promulgated by the Securities and Exchange Commission under the Securities
Act of 1934, as amended).
Notwithstanding anything to the contrary contained in this Note,
neither this Note nor any rights, obligations or claims hereunder shall be
assigned at any time while this Note may be converted, subject to compliance
with Section 9(b) of the Agreement, to Conversion Shares, unless the proposed
assignee delivers an agreement to Maker in form and substance reasonably
acceptable to Maker whereby the proposed assignee makes the representations to
Maker set forth in Sections 8(e) to 8(i) of the Agreement.
This Note shall be governed by and construed in accordance with the
laws of the State of New York. Any provision hereof which may prove
unenforceable under any law shall not affect the validity of any other provision
hereof. The Maker hereby waives presentment, demand for payment, notice of
dishonor, protest and notice of protest, and any or all other notices or demands
in connection with this Note. The liability of the Maker shall be unconditional
and shall not be in any manner affected by any indulgence whatsoever granted or
consented by the Payee, including, but not limited to, any extension of time,
renewal, waiver or other modification. Any failure of the Payee to exercise any
right hereunder shall not be construed as a waiver of the right to exercise the
same or any other right at any time and from time to time thereafter.
NORD RESOURCES CORPORATION
By: _________________________________
Name: Edgar F. Cruft
Title: Chairman
