<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) May 15, 1998
------------
NORD RESOURCES CORPORATION
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 0-6202-2 85-0212139
- --------------- ---------------- -------------
(State of other (Commission File (IRS Employer
jurisdiction of Number) Identification
incorporation) Number)
201 Third Street, NW, Suite 1750
--------------------------------
Albuquerque, NM 87102
--------------- -----
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (505) 766-9955
---------------
N/A
--------------------------------------------------------------
(Former name or former address, if changed since last report.)
<PAGE>
ITEM 5. OTHER EVENTS
On May 15, 1998, Nord Resources Corporation (the "Company") received
from the Overseas Private Investment Corporation ("OPIC") the balance of
the proceeds from the civil strife insurance policy owned by the Company
related to its 50% ownership in Sierra Rutile Limited ("SRL"). The Company
received the $15,704,500 maximum amount allowed under the policy less
$1,500,000 already received. $5,627,429 of the proceeds was advanced by
the Company to SRL to be used, together with an equal amount advanced to
SRL by Consolidated Rutile Limited ("CRL"), the other 50% owner of SRL,
to reduce the existing indebtedness to SRL's development bank lenders (the
"Lenders"), $5,513,047 was deposited into a collateral account as
security for the scheduled September 30, 1998 payment by SRL to its
Lenders and $3,064,024 remains available for general corporate purposes.
Concurrently with the receipt of the insurance proceeds and the
related payment to the Lenders, SRL's debt agreements were amended. The
Company is a 50% guarantor under these agreements. The amendments provide
for a reduction in the interest rate SRL pays on its indebtedness to
6.875%, and the accrual of interest from May 15, 1998 to September 30,
1998 on most of the indebtedness rather than the current payment of such
interest and reschedule of the payments of principal and accrued and
unpaid interest. Pursuant to such amendments, SRL is scheduled to pay
$11,506,562 ($5,753,281 guaranteed by the Company) on September 30, 1998
with the remaining $12,107,466 ($6,053,733 guaranteed by the Company)
payable 25% on September 30, 1999, 25% on September 30, 2000 and 50% on
September 30, 2001 in each case plus then current interest. The stock
of SRL has been pledged to the Lenders as additional collateral for the
indebtedness to Lenders.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits required to be filed by Item 6.01 of Regulation S-K.
<TABLE>
<CAPTION>
Item No. Description
-------- -------------------------------------------------------
<S> <C>
10.115 CDC Amendment Agreement, dated 5/15/98
10.116 DEG Amendment Agreement, dated 5/15/98
10.117 ExIm Bank Amendment Agreement, dated 5/15/98
10.118 UFC Amendment Agreement, dated 5/15/98
10.119 OPIC Amendment Agreement, dated 5/15/98
10.120 Account Security and Control Agreement (with exhibits), dated 5/15/98
10.121 SRL Share Pledge Agreement, dated 5/15/98
10.122 Collateral Agent Agreement, dated 5/15/98
</TABLE>
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
NORD RESOURCES CORPORATION
---------------------------------------
(Registrant)
Date: May 20, 1998 /s/ Ray W. Jenner
---------------------------------------
Ray W. Jenner, Vice President - Finance
<PAGE>
[LETTERHEAD]
As of 15th May 1998
Sierra Rutile Limited
c/o RGC (USA) Mineral Sands
1223 Warner Road
Green Cove Springs, Florida 32043-4623
Attn: Mr. Maxwell E. McGarvie
Acting Chief Executive
1. We refer to our Loan Agreement with you dated 24th January 1992 as amended
to date (capitalized terms used and not otherwise defined herein shall have the
meanings ascribed thereto in the Loan Agreement). The outstanding principal
amount of our loan to you is US$6,976,665.64 (not including any payment made
today). Before expiration of our 15th December 1995 forbearance letter, as
amended and in effect through 15th May 1998, you have asked that we amend the
Loan Agreement as follows:
AMENDMENT NO. 1:
Section 5 of the Loan Agreement would read in its entirety as follows:
"SECTION 5 - INTEREST
5.1 The Borrower shall pay interest at the rate of six point eight seven
five percent (6.875%) per annum on the principal amount of the CDC
Loan disbursed and outstanding from time to time. Interest for the
period from 16th May 1998 through 30th September 1998 shall accrue and
be added to the principal amount of the CDC Loan after the principal
repayment on 30th September 1998. Thereafter, interest shall be paid
annually in arrears in US dollars on 30th September in each year.
5.2 Without prejudice to the provisions of Clause 8.1, any interest
falling due under this Agreement (including any further interest under
this present provision) which is not paid within seven days of its due
date shall itself bear interest (as well after as before judgment)
from the date when it should have been paid until the date when it is
actually paid at the rate of six point eight seven five percent
(6.875%) per annum.
<PAGE>
-2-
5.3 Interest shall accrue and be prorated on the basis of a 360-day year
for the actual number of days in the relevant interest period."
AMENDMENT NO. 2:
Section 7 of the Loan Agreement would read in its entirety as follows:
"SECTION 7 - REPAYMENT
7.1 The CDC Loan (including interest capitalised in accordance with Clause
5.1) shall be repaid on the following dates and in the following
amounts:
<TABLE>
<CAPTION>
DATE PAYMENT DUE PRINCIPAL AMOUNT DUE
---------------- --------------------
<S> <C>
15th May 1998 US$2,990,001.32
30th September 1998 US$1,573,550.12
30th September 1999 US$629,184.96
30th September 2000 US$629,184.96
30th September 2001 US$1,258,369.92
US$7,080,291.28"
----------------
----------------
</TABLE>
AMENDMENT NO. 3:
Clauses 8.1.2 and 8.1.14 of the Loan Agreement would read in their entirety
as follows:
"8.1.2 (a) any default in observing or fulfilling any obligations
(other than an obligation in respect of the payment to CDC of any
instalment of principal moneys or interest or other moneys or an
obligation pursuant to Sections 10, 11.1.3, 12.1.9 or 12.1.11) on
the part of the Borrower to be observed or fulfilled under this
Agreement, which, in the case of a default capable or remedy,
shall continue for a period of sixty days after notice thereof
has been given by CDC to the Borrower; or
(b) any default shall have occurred in the performance of any
obligation of Nord Resources Corporation ("Nord"), Consolidated
Rutile Limited ("CRL") or Sierra Rutile Holdings Limited
("Holdings") under any of the following agreements:
<PAGE>
-3-
(i) Account Security and Control Agreement dated as of 15th
May 1998 among Nord, Chase Manhattan Bank and CDC, DEG,
Eximbank, IFC and OPIC (collectively, the "Senior
Lenders");
(ii) Share Retention Agreement dated 17th November 1992, as
amended, between Nord, CRL and the Seniors Lenders;
(iii) Subordination Agreement dated 17th November 1992, as
amended, between Nord, CRL and the Senior Lenders;
(iv) Share Pledge Agreement dated 15th May 1998 made by
Holdings over 100% of the Shares in the Borrower in
favour of the Senior Lenders;
(v) Guaranty dated 28 February 1996 from Nord to the Senior
Lenders and Guaranty dated 28 February 1996 from CRL to
the Senior Lenders;
and any such default shall have continued for a period of ten
(10) business days after notice thereof shall have been given to
the Borrower by CDC
(c) if Nord fails at any time to maintain free of any liens (other
than to the Senior Lenders), and to certify to the Senior Lenders
on the 10th day of each month that it so maintains:
(i) cash, cash equivalents or marketable securities (such
marketable securities to be valued at the end of each
month using an average closing sale price with reference
to Bloomberg Financial News Service) with an aggregate
value of not less than 150% of Nord's guaranteed portion
of the aggregate outstanding principal amount of the
Senior Loans; and
(ii) cash or cash equivalents having an aggregate value of not
less than 100% of Nord's guaranteed portion of the
aggregate principal amount of the
<PAGE>
-4-
Senior Loans scheduled to be paid during the next six
months."
8.1.14 if either of Nord or CRL fails to pay, or a default occurs
with respect to, any other obligations for borrowed money, whether
contingent or otherwise, of either of Nord or CRL (including, without
limitation, any obligations relating to capital leases) and such
failure or default continues beyond the grace period, if any,
applicable thereto;"
AMENDMENT NO. 4:
A new Clause 8.3 would be added to the Loan Agreement to read as
follows:
"8.3 Before CDC exercises its rights under the Security to sell or
otherwise dispose of the Security following the occurrence of any
event specified in Clause 8.1, CDC shall use reasonable efforts
to give the Borrower, Nord and CRL at least 10 business days'
notice during which time Nord and/or CRL may cure such occurrence
unless, in CDC's opinion, it would be harmed by any such delay.
CDC agrees not to exercise any of its rights under the Security
or in respect of the Security unless the occurrence of any event
specified in Clause 8.1 has occurred."
AMENDMENT NO. 5:
Section 9 of the Loan Agreement would read in its entirety as follows:
"SECTION 9 - EARLY REPAYMENT
9.1 All or any portion of the CDC Loan may be prepaid in whole or in
part at any time on fifteen (15) days' notice at the Borrower's
option without penalty or premium PROVIDED THAT -
9.1.1 no early repayment shall amount to less than US$250,000;
9.1.2 any amounts so prepaid shall be applied in the inverse
order in which moneys fall due for repayment in
accordance with Clause 7.1; and
<PAGE>
-5-
9.1.3 the Borrower shall be required to pay, at the time of any
prepayment, all interest accrued on the principal amount
of the CDC Loan so prepaid.
9.2 Save with the written consent of CDC, the Borrower shall
not be entitled to give or withdraw any notice pursuant
to Clause 9.1 nor to make early repayment of the whole or
any part of the CDC Loan otherwise than in accordance
with the preceding provisions.
AMENDMENT NO. 6:
Clause 12.1.1 of the Loan Agreement would read in its entirety as
follows:
"12.1.1 except for the Security and except for liens that (a) are
evidenced by documents reasonably satisfactory to CDC,
(b) are PARI PASSU with the Security and (c) secure any
long-term indebtedness of the Borrower incurred to
refinance some or all of the Eximbank Loan, the IFC Loan,
the OPIC Loan or the DEG Loan (collectively, the "Senior
Loans") or finance the re-opening of the Project which
has its first scheduled repayment not earlier than 1st
October 2001 ("New Senior Loans"), create or agree to
create or permit to subsist any mortgage, charge, pledge,
lien (other than liens over specific accounts receivable
under existing accounts receivable financing arrangements
with Australia and New Zealand Bank Limited of up to
US$6,000,000 in the aggregate already notified to CDC in
writing) or other encumbrance over any of its present or
future undertaking or assets;"
AMENDMENT NO. 7:
Clause 12.1.7 of the Loan Agreement would read in its entirety as
follows:
"12.1.7 make any prepayment (whether voluntary or involuntarily)
or repurchase of any long-term indebtedness (other than
the CDC Loan), or make any repayment of any such
indebtedness pursuant to any provision of any agreement
or note which provides directly or indirectly for
acceleration of repayment in
<PAGE>
-6-
time or amount, unless in any such case it shall, if CDC
so requires, contemporaneously make a proportionate
prepayment or repayment of the principal amount then
outstanding of the Loan in accordance with the provisions
of Clause 9.1 (except that there shall be no minimum
amount or notice period for such prepayment);"
2. We agree to your requested amendments and to waive any breaches by the
Borrower of this Agreement which arose before May 15, 1998 from the rebel
incursion and occupation of the SRL minesite on 19th/20th January 1995 and
the subsequent discontinuance of operations there or the 25th May 1997
military coup and subsequent political events in Sierra Leone. Theses
amendments will be effective when:
(i) you execute and Nord and CRL acknowledge this amendment
agreement as provided below;
(ii) each other Senior Lender agrees to similar amendments to
its own loan agreement on similar conditions;
(iii) the Senior Lenders receive the executed documents
referred to Clause 8.1.2(b) of Amendment 3 above in form
and substance satisfactory to them;
(iv) OPIC insurance proceeds in an amount of not less than
US$5,500,000 have been deposited with Chase Manhattan
Bank pursuant to the Account Security and Control
Agreement referred to above; and
(v) you deliver legal opinions from counsel satisfactory to
us.
3. In all other respects, the Loan Agreement remains unchanged and in
full force and effect.
4. The laws of England will govern this amendment agreement.
<PAGE>
-7-
If you, Nord and CRL agree, please sign below and return to us by 15th
May 1998.
Very truly yours,
Commonwealth Development Corporation
By: /s/ [ILLEGIBLE]
----------------------
Name: [ILLEGIBLE]
Title: Investment Manager
AGREED:
THE BORROWER
Sierra Rutile Limited
By: /s/ M.E. McGarvie
-------------------
Name: M.E. McGarvie
Title: Acting Chief Executive
<PAGE>
-8-
THE GUARANTORS
Our Guaranty to you dated February 28, 1996,
our Share Retention Agreement with you dated
17th November 1992, as amended, and our
Subordination Agreement with you dated
17th November 1992, as amended, all
remain in full force and effect.
Nord Resources Corporation
By: /s/ Ray W. Jenner
---------------------
Name: Ray W. Jenner
Title: Vice President Finance
Our Guaranty to you dated February 28, 1996,
our Share Retention Agreement with you dated
17th November 1992, as amended, and our
Subordination Agreement with you dated
17th November 1992, as amended, all
remain in full force and effect.
Consolidated Rutile Limited
By: /s/ James B. Thynne
----------------------
Name: James B. Thynne
Title: Attorney in Fact
<PAGE>
DEG - DEUTSCH INVESTITIONS- UND ENTWICKLUNGSGESELLSCHAFT MBH
As of May 15, 1998
Sierra Rutile Limited
c/o RGC (USA) Mineral Sands
1223 Warner Road
Green Cove Springs, Florida 32043-4623
Attn: Mr. Maxwell E. McGarvie
Acting Chief Executive
1. We refer to our Loan Agreement with you dated August 6, 1992 as amended to
date (capitalized terms used and not otherwise defined herein shall have the
meanings ascribed thereto in the Loan Agreement). The outstanding principal
amount of our loan to you is US$3,437,500.00 (not including any payment made
today). Before expiration of our December 15, 1995 forbearance letter, as
amended and in effect through May 15, 1998, you have asked that we amend the
Loan Agreement as follows:
AMENDMENT NO. 1:
Article 5 of the Loan Agreement would read in its entirety as follows:
"ARTICLE 5 INTEREST
1. The BORROWER shall pay interest at the rate of six point
eight seven five percent (6.875%) per annum on the principal
amount of the Loan disbursed and outstanding from time to
time. Interest for the period from May 16, 1998 through
September 30, 1998 shall accrue and be added to the
principal amount of the Loan AFTER the principal repayment
on September 30, 1998. Thereafter, interest shall be paid
annually in arrears in Dollars on September 30 in each year.
Interest shall accrue and be prorated on the basis of a
360-day year for the actual number of days in the relevant
interest period."
AMENDMENT NO. 2:
Article 6 of the Loan Agreement would read in its entirety as follows:
<PAGE>
-2-
"ARTICLE 6 REPAYMENT AND PREPAYMENT
1. The Loan (including interest capitalized in accordance
with Article 5) shall be repaid on the following dates
and in the following amounts:
<TABLE>
<CAPTION>
DATE PAYMENT DUE PRINCIPAL AMOUNT DUE
---------------- --------------------
<S> <C>
May 15, 1998 US$937,500.00
September 30, 1998 1,365,069.58
September 30, 1999 299.845.89
September 30, 2000 299.845.89
September 30, 2001 599,691.77
US$3,501,953.13"
----------------
----------------
</TABLE>
2. All or any portion of the Loan may be prepaid in whole
or in part at any time on 15 days' notice at the
BORROWER's option without penalty or premium PROVIDED
THAT -
a) any amounts so prepaid shall be applied in the
inverse order in which moneys fall due for
repayment in accordance with Section 1 of this
Article 6; and
b) the BORROWER shall be required to pay, at the time
of any prepayment, all interest accrued on the
principal amount of the Loan so prepaid."
AMENDMENT NO. 3:
Each of the references to "Article 5 paragraph 2" contained in Article 7
paragraph 2 of the Loan Agreement and to "Article 5 paragraph 4" contained in
Article 7 paragraph 3 of the Loan Agreement would read in its entirety as
"Article 5."
AMENDMENT NO. 4:
Clause 2 of Article 9 of the Loan Agreement would read in its entirety as
follows:
<PAGE>
-3-
"2. The BORROWER undertakes to DEG not to charge any of its
assets without the prior explicit approval and written
consent of DEG except that the BORROWER and other
parties providing collateral security for the Loan may
grant liens on assets securing the Loan that (x) are
evidenced by documents reasonably satisfactory to DEG,
(y) are pari passu with the security for the Loan and
(z) secure the IFC Loan, the OPIC Loan, the CDC Loan
and the Eximbank Loan (collectively with the Loan, the
'Senior Loans') and any long-term indebtedness of the
BORROWER incurred to refinance any of the Senior Loans
or to finance the re-opening of the PROJECT which has
its first scheduled repayment not earlier than
October 1, 2001 ('New Senior Loans')."
AMENDMENT NO. 5:
A new Subparagraph (ii) would be added at the end of Paragraph (f) of
Clause 1 of Article 12 of the Loan Agreement to read as follows:
"(ii) New Senior Loans;"
AMENDMENT NO. 6:
Paragraph (k) of Clause 1 of Article 12 of the Loan Agreement would read in
its entirety as follows:
"(k) not make any prepayment of any long-term indebtedness (other
than any Senior Loans refinanced with New Senior Loans);"
AMENDMENT NO. 7:
Paragraphs (c) and (e) of Article 13 of the Loan Agreement would read in
their entirety as follows:
"c) (i) default shall have occurred in the performance of any
obligation of the BORROWER to DEG and continued for a period
of 30 days after notice thereof shall have been given to the
BORROWER by DEG, except:
<PAGE>
-4-
(x) any obligation for the payment of principal or interest under
this Agreement;
(y) obligations in Paragraphs (c), (e) or (i) of Article 10; and
(z) any obligation under any other agreement between the BORROWER and
DEG of the security or security documents relating to the Loan or
in the performance by any party under any PROJECT documents not
listed in (c)(ii) below;
(ii) default shall have occurred in the performance of any obligation
of Nord, CRL or Holdings under any of the following agreements:
(A) Account Security and Control Agreement dated as of May 15, 1998
among Nord, the Chase Manhattan Bank and CDC, DEG, Eximbank, IFC
and OPIC (collectively, the "Senior Lenders");
(B) Share Retention Agreement dated November 17, 1992, as amended,
among the BORROWER, Holdings, Nord, CRL and the Senior Lenders;
(C) Subordination Agreement dated November 17, 1992, as amended,
between Nord, CRL and the Senior Lenders;
(D) Share Pledge Agreement dated as of May 15, 1998 of Holdings in
favor of the Senior Lenders; and
(E) Guaranty dated February 28, 1996 from Nord to the Senior Lenders
and Guaranty dated February 28, 1996 from CRL to the Senior
Lenders;
and such default shall have continued for a period of ten (10) days
after notice thereof shall have been given to the BORROWER by DEG;
<PAGE>
-5-
(iii) if Nord fails at any time to maintain free of any liens
(other than to the Senior Lenders), and to certify to the Senior
Lenders on the 10th day of each month that it so maintains
(x) cash, cash equivalents or marketable securities (such
marketable securities to be valued at the end of each month
using an average closing sale price with reference to
Bloomberg Financial News Service) with an aggregate value of
not less than 150% of Nord's guaranteed portion of the
aggregate outstanding principal amount of the Senior Loans;
and
(y) cash or cash equivalents having an aggregate value of not
less than 100% of Nord's guaranteed portion of the aggregate
principal amount of the Senior Loans scheduled to be paid
during the next six months;
e) a default shall have occurred with respect to any indebtedness for
borrowed money of the BORROWER (other than the Loan) or under any
agreement pursuant to which there is outstanding any such
indebtedness of the BORROWER;
AMENDMENT NO. 8:
A new Paragraph (m) would be added to Article 13.1 of the Loan Agreement to
read as follows:
"m) if either CRL or Nord fails to pay, or a default occurs with respect
to any other obligations for borrowed money, whether contingent or
otherwise of such Sponsor, (including, without limitation, any
obligations relating to capital leases) and such failure or default
continues beyond the grace period, if any, applicable thereto:"
AMENDMENT NO. 9:
A new Article 13.1 would be added to the Loan Agreement to read as follows:
<PAGE>
-6-
"ARTICLE 13.1 ACTIONS RELATING TO THE SECURITY
Before DEG exercises its rights under the security documents or in
respect of the security for the Loans to sell or otherwise dispose of
the security following an Event of Default, DEG shall use reasonable
efforts to give the BORROWER and the Sponsors at least 10 business
days' notice during which time the Sponsors may cure such Event of
Default unless, in DEG's opinion, it would be harmed by any such
delay. DEG agrees not to exercise any of its rights under the
security documents or in respect of the security unless an Event of
Default has occurred."
2. We agree to your requested amendments and to waive any Events of Default
which arose before May 15, 1998 from the rebel incursion and occupation of the
SRL minesite on January 19/20, 1995 and the subsequent discontinuance of
operations there or the May 25, 1997 military coup and subsequent political
events in Sierra Leone. These amendments and waivers will be effective when:
(i) you execute and Nord and CRL (the "Guarantors") acknowledge
this agreement as provided below;
(ii) each of IFC, OPIC, CDC and Eximbank (collectively with DEG, the
"Senior Lenders") agrees to similar amendments to their own
loan agreements on similar conditions;
(iii) the Senior Lenders receive fully executed documents described
in clause (c)(ii) of Amendment No. 7 above in the forms
attached;
(iv) OPIC insurance proceeds in an amount of not less than
US$5,500,000 have been deposited with Chase Manhattan Bank
pursuant to the Account Security and Control Agreement referred
to above; and
(v) you deliver legal opinions from counsel satisfactory to us in
the forms attached.
<PAGE>
-7-
3. In all other respects, the Loan Agreement remains unchanged.
4. The laws of the Federal Republic of Germany will govern this amendment
agreement.
If you, Nord and CRL agree, please sign below and return to us by May 15,
1998.
Very truly yours,
DEG - Deutsch Investitions- und
Entwicklungsgesellschaft mbH
By: /s/ [ILLEGIBLE]
-------------------------
Name: [ILLEGIBLE]
Title:
AGREED:
THE BORROWER
Sierra Rutile Limited
By:
------------------------
Name:
Title:
THE GUARANTORS
Our Guaranty to you dated February 28, 1996
remains in full force and effect.
Nord Resources Corporation
By:
------------------------
Name:
Title:
<PAGE>
-7-
3. In all other respects, the Loan Agreement remains unchanged.
4. The laws of the Federal Republic of Germany will govern this amendment
agreement.
If you, Nord and CRL agree, please sign below and return to us by May ___,
1998.
Very truly yours,
DEG - Deutsch Investitions- und
Entwicklungsgesellschaft mbH
By: /s/
-------------------------
Name:
Title:
AGREED:
THE BORROWER
Sierra Rutile Limited
By: /s/ M.E. McGarvie
------------------------
Name: M.E. McGarvie
Title: Acting Chief Executive
THE GUARANTORS
Our Guaranty to you dated February 28, 1996,
our Share Retention Agreement with you dated
November 17, 1992, as amended, and our Subordination
Agreement with you dated November 17, 1992, as amended,
remains in full force and effect.
Nord Resources Corporation
By: /s/ Ray W. Jenner
------------------------
Name: Ray W. Jenner
Title: Vice President Finance
<PAGE>
-8-
Our Guaranty to you dated February 28, 1996,
our Share Retention Agreement with you dated
November 17, 1992, as amended, and our Subordination
Agreement with you dated November 17, 1992, as amended,
remains in full force and effect.
Consolidated Rutile Limited
By: /s/ James B. Thynne
------------------------
Name: James B. Thynne
Title: Attorney in Fact
<PAGE>
As of May 15, 1998
Sierra Rutile Limited
c/o RGC (USA) Mineral Sands
1223 Warner Road
Green Cove Springs, Florida 32043-4623
Attention: Mr. Maxwell E. McGarview
Acting Chief Executive
1. We refer to our agreements with you titled (i) Fifth Amendment to and
Restatement of the Financing Agreement dated November 24, 1986, and (ii) Second
Amendment to and Restatement of Credit Agreement based upon our agreement with
you dated January 1, 1976, all as amended to date (the "Loan Agreement").
Capitalized terms used and not otherwise defined herein shall have the meaning
ascribed thereto in the Loan Agreements. The outstanding principal amount of
our loan to you (the "Loan") as of May 15, 1998 is US$10,023,967.84 (not
including any payment made today). Before expiration of our December 15, 1997
forbearance letter, as amended, and in effect through May 15, 1998, you have
asked that we amend the Loan Agreements as follows:
AMENDMENT NO. 1:
The provisions in the Loan Agreements, which specify the interest payable
on the Loan, are replaced in their entirety with the following:
"INTEREST. (a) The Company shall pay interest at the rate of six
point eight seven five percent (6.875%) per annum on the principal amount of the
Loan disbursed and outstanding from time to time. Interest for the period from
May 16, 1998 through September 30, shall accrue and be added to the principal
amount of the Loan AFTER the principal repayment on September 30, 1998.
Thereafter, interest shall be paid annually in arrears in Dollars on September
30 in each year. Interest shall accrue and be prorated on the basis of a
365-day year for the actual number of days in the relevant interest period.
(b) Notwithstanding any provision to the contrary herein, the default
rate of interest for principal, interest and any amounts due to Eximbank from
the Company hereunder shall be eight point eight seven five percent (8.875%)."
<PAGE>
AMENDMENT NO. 2:
The terms of payment of the Loan specified in the Loan Agreements are
replaced in their entirety with the following:
"SCHEDULE OF PAYMENT. The Loan shall be repaid on the following dates and
in the following amounts.
<TABLE>
<CAPTION>
Date Payment Due Principal Amount Due
---------------- --------------------
<S> <C>
May 15, 1998 $2,505,993.35
September 30, 1998 $4,231,427.95
September 30, 1999 $870,490.47
September 30, 2000 $870,490.47
September 30,2001 $1,740,981.43
</TABLE>
Amendment No. 3:
The provisions in the Loan Agreements, which specify the terms of
repayment of the Loan and other Indebtedness are replaced in their entirety with
the following:
"Prepayment. (a) Company shall have the right at any time on 15 days
notice, subject to payment of all accrued interest on the principal amount of
the Loan to be prepaid, to prepare all or a part of the principal amount then
outstanding of the Loan; provided that, in the case of partial prepayment, such
prepayment shall be not less than $250,000 and applied to prepay all the
outstanding prepayment installments of the Loan on a pro rata basis. Upon
delivery of such notice, the Company shall be obligated to effects payment in
accordance with the terms thereof.
(b) The Company shall prepay all or part of its Indebtedness solely in
accordance with the provisions set forth herein. The Company shall not make any
prepayment (whether voluntary or involuntary) or repurchase of any long-term
Indebtedness (other than the Loan) or make any repayment of any such
Indebtedness pursuant to any provision of any agreement or note which provides
directly or indirectly for acceleration of repayment in time or amount, unless
in any such case it shall, if Eximbank so requires, contemporaneously make a
proportionate prepayment or repayment of the principal amount then outstanding
of the Loan in accordance with the Loan Agreements, as amended by this Agreement
(except that there shall be no minimum amount of notice period for such
prepayment)."
AMENDMENT NO. 4: [intentionally omitted]
<PAGE>
AMENDMENT NO. 5:
Section 1.04.B(2) of the Loan Agreements would be amended by
incorporating the following paragraph thereto to read in its entirety as
follows:
"(g) Long-term Indebtedness incurred to refinance some or all of the
Senior Loans or to finance the re-opening of the Project which has its first
scheduled repayment not earlier than October 1, 2001 ("New Senior Loans")."
AMENDMENT NO. 6:
Section 1.04.B (1)(i) of the Loan Agreements would be amended by
incorporating the following clause thereto to read in its entirety as follows:
"Liens that (x) are evidenced by documents reasonably satisfactory to
Eximbank, (y) are PARI PASSU with the Security (as that term is defined in the
Investment Agreement between the Company and the International Finance
Corporation dated June 30, 1992) and (z) secure Senior Debt and any New Senior
Loans;"
AMENDMENT NO. 7: [intentionally omitted]
AMENDMENT NO. 8:
Paragraphs (b), (e), and (f) of Section 1.03 of the Loan Agreements would
be amended, paragraph (j) of Section 1.03 of the Loan Agreements would be
deleted, and new paragraph (q), (r) and (s) would be added to Section 1.03 of
the Loan Agreements to read as follows:
"(b) A default or event of default occurs or declared under any of the
IFC Loan Documents, as amended to date, the CDC Loan Documents, as amended to
date, the DEG Loan Documents, as amended to date or the OPIC Loan Documents, as
amended to date, and is not cured within any applicable notice or grace period
thereunder, or"
"(e) The Company fails to comply with any covenant in the Eximbank Loan
Documents expressly identified as a negative covenant or the Nord Resources
Corporation ("Nord") fails to perform its obligations under the Project Funds
Agreement (other than as they relate to carrying out or changes in the nature,
scope or operation of the Project); or"
"(f) The Company fails to comply with or perform any agreement or
covenant (other than as they relate to carrying out or changes in the nature,
scope or operation of the Project) contained in the Eximbank Loan Documents
(exclusive of any events specified as an Event of Default in any other
subparagraph of this Events of Default paragraph) other than negative covenants
and any such failure continues for 30 days after Eximbank has notified the
Company thereof; or"
<PAGE>
"(j) [intentionally deleted]"
"(q) default shall have occurred in the performance of any obligations
of any of the Sponsors or Sierra Rutile Holdings Limited ("Holdings") under any
of the following agreements:
(A) Account Control and Security Agreement dated as of May 15,
1998 among Nord, the Chase Manhattan Bank and the Senior Lenders.
(B) Share Retention Agreement dated as of November 17, 1992, as
amended, between the Sponsors and the Senior Lenders;
(C) Subordination Agreement dated November 17, 1992, as
amended, between the Sponsors and the Senior Lenders;
(D) Share Pledge Agreement dated as of May 15, 1998 made by
Holdings over 100% of the shares in the Company in favor of the Senior Lenders;
(E) Guaranty dated February 28, 1996 from Nord to the Senior
Lenders and Guaranty dated February 28, 1996 from CRL to the Senior Lenders;
and any such default shall have continued for a period of ten business
(10) days after notice thereof shall have been given to the Company by Eximbank;
or
(r) If Nord fails at any time to maintain free of any liens (other
than to Senior Lenders), and to certify to the Senior lenders on
10th day of each month that it so maintains
(x) cash, cash equivalents or marketable securities (such
marketable securities to be valued at the end of each month using an average
closing sale price with reference to Bloomberg Financial News Service) with an
aggregate value of not less than 150% of Nord's guaranteed portion of the
aggregate outstanding principal amount of the Senior Loans; and
(y) cash or cash equivalents having an aggregate value of not
less than 100% of Nord's guaranteed portion of the aggregate principal amount of
the Senior Loans scheduled to be paid during the next six months; and
(s) If either of the Sponsors fails to pay or default occurs with
respect to any other obligations for borrowed money, whether contingent or
otherwise, of such Sponsor (including, without limitation, any obligations
relating to capital leases) and such failure or default continues beyond the
grace period, if any, applicable thereto."
AMENDMENT NO. 9: [intentionally deleted]
AMENDMENT NO. 10: [intentionally deleted]
<PAGE>
AMENDMENT NO. 11:
A new paragraph would be added at the end of Section 1.03 of the Loan
Agreements to read as follows:
"Before Eximbank exercises its rights under the Security to sell or
otherwise dispose of the Security following an Event of Default, Eximbank shall
use reasonable efforts to give the Company and the Sponsors in their capacity as
guarantors (the "Guarantors") at least 10 business days notice during which time
the Guarantors may cure such Event of Default unless, in Eximbank's opinion, it
would be harmed by any such delay. Eximbank agrees not to exercise any of its
rights under the Security Documents (as defined in the IFC Agreement) and the
other security documents referred to in Section 2.03 of the Loan Agreements, as
amended by this Agreement, unless an Event of Default has occurred."
AMENDMENT NO. 12:
The term "Project Documents" is amended to include each documents listed
in Section 1.03(q).
2. We agree to your requested amendments and to waive any Events of Default
which arose before May 15, 1998 from the rebel incursion and occupation of the
SRL minesite on January 19/20, 1995 and the subsequent discontinuation of
operation there or the May 25, 1997 military coup and subsequent political
events in Sierra Leone. These amendments and waivers will be effective when:
(i) you and the Guarantors countersign this Agreement as provided
below;
(ii) each other Senior Lender agrees to similar amendments to their own
loan agreements on similar conditions;
(iii) the Senior Lenders receive the fully executed documents described
in Amendment No. 8 above in the forms attached;
(iv) OPIC insurance proceeds in an amount of not less than 5,500,000
Dollars have been deposited with The Chase Manhattan Bank pursuant
to the Account Control and Security Agreement referred to above;
and
(v) you deliver legal opinions from counsel satisfactory to us in the
forms attached.
3. In all other respect, the Loan Agreements remain unchanged.
<PAGE>
4. The laws of the District of Columbia, United States of America will
govern this Agreement without regard to the conflict of laws principles
thereof.
<PAGE>
If you and the Guarantors agree, please sign below and return to us by May 15,
1998.
Very truly yours,
EXPORT-IMPORT BANK OF
THE UNITED STATES
By: ________________________
Name:
Title:
AGREED:
SIERRA RUTILE LIMITED
By: ______________________
Name:
Title:
<PAGE>
AGREED
Our Guaranty to you dated February 28, 1996, our Share Retention Agreement with
you dated November 17, 1992, as amended and our Subordination Agreement with you
dated November 17, 1992, as amended, all remain in full force and effect and are
hereby ratified and confirmed in all respects. Each of the representations and
warranties set forth in Section 4(a) through (h), (k) and (l) of the Guaranty is
true and correct in all material respects as of the date hereof, provided that
references to Financial Statement shall be deemed to refer to our December 31,
1997 annual, and subsequent interim statements.
NORD RESOURCES CORPORATION
By: ______________________________
Name:
Title:
AGREED
Our Guaranty to you dated February 28, 1996, our Share Retention Agreement with
you dated November 17, 1992, as amended and our Subordination Agreement with you
dated November 17, 1992, as amended, all remain in full force and effect and are
hereby ratified and confirmed in all respects. Each of the representations and
warranties set forth in Section 4(a) through (h), (k) and (l) of the Guaranty is
true and correct in all material respects as of the date hereof, provided that
references to Financial Statement shall be deemed to refer to our June 30, 1997
annual, and subsequent interim statements.
Consolidated Rutile Limited
By: ______________________________
Name:
Title:
<PAGE>
As of May 15, 1998
Sierra Rutile Limited
Attn: Maxwell E. McGarvie
Acting Chief Executive
1. We refer to our Investment Agreement with you dated June 30, 1992 as
amended to date. The outstanding principal amount of our loan to you
is US$7,095,000 (not including any payment made today). Before
expiration of our December 15, 1995 forbearance letter, as amended,
and in effect through May 15, 1998, you have asked that we amend the
Investment Agreement as follows:
AMENDMENT NO. 1
Section 3.02 of the Investment Agreement would read in its entirety as
follows:
"Section 3.02. The Company shall pay interest at the rate of six
point eight seven five per cent (6.875%) per annum on the principal
amount of the Loan disbursed and outstanding from time to time.
Interest for the period from May 16, 1998 through September 30, 1998
shall accrue and be added to the principal amount of the Loan after
the principal repayment on September 30, 1998. Thereafter, interest
shall be paid annually in arrears in Dollars on September 30 in each
year. Interest shall accrue and be prorated on the basis of a 360-day
year for the actual number of days in the relevant interest period."
AMENDMENT NO. 2
Section 3.04 of the Investment Agreement would read in its entirety as
follows:
"Section 3.04. (a) The Loan shall be repaid on the following dates and
in the following amounts:
<TABLE>
<CAPTION>
Date Payment Due Principal Amount Due
---------------- --------------------
<S> <C>
May 15, 1998 $ 1,935,000.00
September 30, 1998 2,817,503.61
September 30, 1999 619,620.97
September 30, 2000 619,620.97
September 30, 2001 1,239,241.95
--------------
$ 7,230,987.50"
--------------
--------------
</TABLE>
<PAGE>
2
AMENDMENT NO. 3
Section 3.06 of the Investment Agreement would read in its entirety as
follows:
"Section 3.06. The Company shall have the right at any time on 15
days notice, subject to payment of all accrued interest on the
principal amount of the Loan to be prepaid, to prepay all or a part of
the principal amount then outstanding of the Loan; provided that, in
the case of partial prepayment, such prepayment shall be not less than
$250,000 and applied to prepay all the outstanding prepayment
installments of the Loan on a pro rata basis. Upon delivery of such
notice, the Company shall be obligated to effect payment in accordance
with the terms thereof."
AMENDMENT NO. 4
Section 3.09 of the Investment Agreement would be amended to change
the default interest rate for interest, principal and all other
amounts to eight point eight seven five per cent (8.875%).
AMENDMENT NO. 5
A new Section 6.02 (d)(ix) would be added to the Investment Agreement
to read as follows:
"(ix) Long-term Debt incurred to refinance some or all of the Senior
Loans or to finance the re-opening of the Project which has its
first scheduled repayment not earlier than October 1, 2001 ("New
Senior Loans")";
AMENDMENT NO. 6
Section 6.02(f)(ii) of the Investment Agreement would read in its
entirety as follows:
"(ii) liens that (x) are evidenced by documents reasonably
satisfactory to IFC, (y) are pari passu with the Security and
(z) secure the Senior Loans and any New Senior Loans";
AMENDMENT NO. 7 - (Intentionally omitted)
AMENDMENT NO. 8
Section 7.01(c) of the Investment Agreement would read in its entirety
as follows:
"(c) (i) default shall have occurred in the performance of
any obligation of the Company to IFC and continued for a
period of 30
<PAGE>
3
days after notice thereof shall have been given to the
Company by IFC, EXCEPT:
(x) any obligation for the payment of principal or
interest under this Agreement.
(y) obligations in Section 6.01(a) or 6.02(j)
(but, for 6.02(j) this exception applies only
as it relates to changes in the nature, scope
or operation of the Project); and
(z) any obligation under any other agreement
between the Company and IFC or the Security or
the Security Documents or in the performance
of any obligation by any party under any
Project Documents not listed in (c)(ii) below;
(ii) default shall have occurred in the performance of any
obligation of Nord, CRL or Holdings, as relevant, under any of
the following agreements:
(A) Account Control and Security Agreement dated as of May 15,
1998 among Nord, The Chase Manhattan Bank and the Senior
Lenders;
(B) Share Retention Agreement dated November 17, 1992, between
Nord, CRL and the Senior Lenders;
(C) Subordination Agreement dated November 17, 1992, between
Nord, CRL and the Senior Lenders;
(D) Share Pledge Agreement dated as of May 15, 1998 made by
SRL Holdings over 100% of the shares in the Company in
favor of the Senior Lenders;
(E) Guaranty dated February 28, 1996 from Nord to the Senior
Lenders and Guaranty dated February 28, 1996 from CRL to
the Senior Lenders;
and any such default shall have continued for a period of ten
business (10) days after notice thereof shall have been given to
the Company by IFC;
(iii) if Nord fails at any time to maintain free of any liens
(other than in favor of the Senior Lenders), and to certify to
the Senior Lenders on the 10th day of each month that it so
maintains:
<PAGE>
4
(x) cash, cash equivalents or marketable
securities (such marketable securities to be
valued at the end of each month using an
average closing sale price with reference to
Bloomberg Financial News Service) with an
aggregate value of not less than 150% of
Nord's guaranteed portion of the aggregate
outstanding principal amount of the Senior
Loans; and
(y) cash or cash equivalents having an aggregate
value of not less than 100% of Nord's
guaranteed portion of the aggregate principal
amount of the Senior Loans scheduled to be
paid during the next six months."
AMENDMENT NO. 9
A new Section 7.05 (j) would be added to the Investment Agreement to
read as follows:
"(j) if either of Nord or CRL fails to pay, or a default occurs with
respect to, any other obligations for borrowed money, whether
contingent or otherwise, of such Sponsor (including without
limitation, any obligations relating to capital leases) and such
failure or default continues beyond the grace period, if any,
applicable thereto;"
AMENDMENT NO. 10
Section 7.01 (g) would read in its entirety as follows:
"(g) a default shall have occurred with respect to any indebtedness
for borrowed money of the Company (other than the Loan) or under any
agreement pursuant to which there is outstanding any such indebtedness
of the Company and any such default shall have continued for more than
any applicable period of grace;"
AMENDMENT NO. 11
A new Section 7.05 would be added to the Investment Agreement to read
as follows:
"Section 7.05. Before IFC exercises its rights under the Security to
sell or otherwise dispose of the Security following an Event of
Default, IFC shall use reasonable efforts to give the Company and Nord
and CRL at least 10 business days notice during which time Nord and
CRL may cure such Event of Default
<PAGE>
5
unless, in IFC's opinion, it would be harmed by any such delay. IFC
agrees not to exercise any of its rights under the Security Documents
or in respect of the Security unless an Event of Default under this
Agreement has occurred."
AMENDMENT 12
The term "Project Documents" is amended to include each document
listed in Section 7.01(c).
2. We agree to your requested amendments and to waive any Events of
Default which arose before May 15, 1998 from the rebel incursion and
occupation of the SRL minesite on January 19/20, 1995 and the
subsequent discontinuance of operations there or the May 25, 1997
military coup and subsequent political events in Sierra Leone. These
amendments and waivers will be effective when:
(i) you execute and the Guarantors acknowledge this agreement
as provided below;
(ii) each other Senior Lender agrees to similar amendments to
their own loan agreements on similar conditions;
(iii) the Senior Lenders receive the fully executed documents
described in Amendment No. 8 above in the forms attached;
(iv) you deliver legal opinions from counsel satisfactory to us
in the forms attached.
3. In all other respects, the Investment Agreement remains unchanged.
4. The laws of England will govern this amendment agreement.
If you and the Guarantors agree, please sign below and return to us by
May 15, 1998.
Very truly yours,
INTERNATIONAL FINANCE CORPORATION
By:
-------------------------------
Name:
Title:
<PAGE>
6
AGREED:
THE COMPANY
Sierra Rutile
By:
----------------------------
Name:
Title:
THE GUARANTORS
Our Guaranty to you dated February 28, 1996,
our Share Retention Agreement with you dated
November 17, 1992 and our Subordination
Agreement with you dated November 17, 1992
all remain in full force and effect.
Nord Resources Corporation
By:
----------------------------
Name:
Title:
Our Guaranty to you dated February 28, 1996,
our Share Retention Agreement with you dated
November 17, 1992 and our Subordination
Agreement with you dated November 17, 1992
all remain in full force and effect.
Consolidated Rutile Limited
By:
----------------------------
Name:
Title:
<PAGE>
AGREEMENT OF WAIVER AND
FOURTH AMENDMENT TO FINANCE AGREEMENT
As of May 15, 1998
Sierra Rutile Limited (the "Company")
c/o RGC (USA) Mineral Sands
1223 Warner Road
Green Cove Springs, Florida 32043-4623
1. We refer to our Finance Agreement with you dated as of August 11, 1992 as
amended to date (the "Finance Agreement"). (Capitalized terms used in this
Fourth Amendment have the meanings given in the Finance Agreement). We
also refer to our December 15, 1995 forbearance letter, as amended, among
the Company, the Sponsors and the Senior Lenders, and in effect through May
15, 1998.
2. The outstanding principal amount of the Loan, as of the date hereof is
$6,734,847.45.
3. You have requested that OPIC amend the Finance Agreement and the Notes as
follows:
a) Each of the Notes would be amended as set forth in Exhibit A attached
hereto, and the term "Note" as defined in Section 1.01 of the Finance
Agreement would be amended by adding the phrase "as the same may be
amended from time to time."
b) Each of the following new terms would be added to Section 1.01 of the
Finance Agreement, to read as follows:
"Guaranty" or "Guaranties" means the respective Guaranty
agreements dated as of February 28, 1996, entered into by the
Sponsors in favor of the Senior Lenders.
"Account Control and Security Agreement" means the Account
Control and Security Agreement dated as of May 15, 1998 among
Nord, the Senior Lenders, and the Chase Manhattan Bank, as
securities intermediary.
"Collateral Agent Agreement" means the Collateral Agent
Agreement dated as of May 15, 1998 among Holdings, the Banks,
and the Chase Manhattan Bank, as collateral agent.
<PAGE>
"Share Pledge Agreement" means the Sierra Rutile Share Pledge
Agreement dated as of May 15, 1998, made by Holdings in favor
of the Senior Lenders.
c) All references to "Project Funds Agreement" in the Finance Agreement
would be deemed to be references to the "Guaranties" or either of
them, as the context suggests.
d) Section 2.04 of the Finance Agreement would be amended by changing the
word "quarterly" to "annually."
e) The second sentence of clause (b) of Section 2.05 of the Finance
Agreement would read in its entirety as follows:
The Maximum Loan Amount shall be reduced on the following dates
and in the following amounts:
<TABLE>
<CAPTION>
Date Payment Due Principal Amount Due
---------------- --------------------
<S> <C>
May 15, 1998 $2,886,363.66
September 30, 1998 $1,417,587.17
September 30, 1999 $607,724.16
September 30, 2000 $607,724.16
September 30, 2001 $1,215,448.31
</TABLE>
provided, that, on September 30, 2001 the Maximum Loan Amount
shall be reduced to zero and the entire unpaid principal
balance of the Loan, together with all accrued interest and
fees due hereunder, shall be paid in full.
f) Section 2.06 of the Finance Agreement would read in its entirety as
follows:
Section 2.06. VOLUNTARY PREPAYMENT. The Company may, upon fifteen
(15) days prior notice to OPIC, prepay the Loan in whole or in part,
subject to payment of all accrued interest on the principal amount of
the Loan to be prepaid to the date of prepayment. The amount of any
such partial prepayment shall be not less than $250,000 and shall be
applied to the outstanding principal installments of the Loan under
the repayment schedule provided for in Section 2.05(b) on a pro rata
basis. Upon delivery of such notice, the Company shall be obligated
to effect payment in accordance with the terms thereof.
g) Sections 2.07(c) and 2.08 of the Finance Agreement would be deleted in
their entirety.
h) A new Section 7.01(vi) would be added to the Finance Agreement to read
in its entirety as follows:
<PAGE>
"(vi) Liens that (A) are evidenced by documents reasonably
satisfactory to OPIC, (B) are pari passu with the Liens created
under the Security Documents and (C) secure the Senior Debt and
any New Senior Loans (as defined in Section 7.02(g))."
h) A new Section 7.02 (g) would be added to the Finance Agreement to read
as follows:
"(g) Long-term Indebtedness incurred to refinance some or all
of the Senior Loans (subject to compliance with the
requirements of Section 2.07(b)) or to finance the re-opening
of the Project, which Indebtedness has its first scheduled
repayment not earlier than October 1, 2001 ("New Senior
Loans")";
j) Section 8.01 (e) would read in its entirety as follows:
"(e) The Company fails to comply with any covenant or
provision set forth in Article VII hereof, other than Sections
7.07 (b) and (f); or"
k) Section 8.01 (f) would be amended by adding at the end thereof:
"...excluding, however, noncompliance with Sections 6.01 and 6.11."
l) Section 8.01 (j) would be amended by deleting the parenthetical
beginning in the third line thereof, and inserting the following in
its place: "...(other than this Agreement or as otherwise provided in
Section 8.01(q)...".
m) A new Section 8.01 (q) would be added to the Finance Agreement to read
in its entirety as follows:
"(q) The Company, either Sponsor, or any other affiliated
party thereto (other than OPIC) fails to comply with or perform
any of its obligations or undertakings set forth in the
Guaranties, the Share Retention and Voting Agreement, the
Subordination Agreement, the Account Control and Security
Agreement, or the Share Pledge Agreement, and such failure
continues for ten (10) Business Days after OPIC has notified
the Company or such party thereof."
n) A new Section 8.01 (r) would be added to the Finance Agreement to read
in its entirety as follows:
"(r) Nord fails at any time to maintain free of any Liens
(other than Liens in favor of the Senior Lenders), and to
certify to the Senior Lenders on the tenth day of each month
that it so maintains:
<PAGE>
(x) cash, cash equivalents or marketable securities
(such marketable securities to be valued at the
end of each month using an average closing sale
price over that month with reference to Bloomberg
Financial News Service) with an aggregate value of
not less than 150% of Nord's guaranteed portion of
the aggregate outstanding principal amount of the
Senior Debt; and
(y) cash or cash equivalents with an aggregate value
of not less than 100% of Nord's guaranteed portion
of the aggregate principal amount of the Senior
Debt scheduled to be paid during the next six
months.
o) A new Section 8.01 (s) would be added to the Finance Agreement to read
it its entirety as follows:
(s) Either of the Sponsors fails to pay, or a default
occurs with respect to, any other Indebtedness for
borrowed money, whether contingent or otherwise, of
such Sponsor] (including without limitation, any
obligations relating to capital leases) and such
failure or default continues beyond the grace period,
if any, applicable thereto:
p) A new Section 8.06 would be added to the Finance Agreement to read as
follows:
Section 8.06. Before OPIC exercises its rights under the
Security Documents to sell or otherwise dispose of the
collateral thereunder following an Event of Default, OPIC shall
use reasonable efforts to give the Company and the Sponsors at
least 10 Business Days notice during which time the Sponsors
may cure such Event of Default unless, in OPIC's opinion, it
would be harmed by any such delay. In addition, OPIC agrees,
without in any way waiving any of its rights under the Security
Documents, not to exercise any of its rights under the Security
Documents unless an Event of Default has occurred under the
Finance Agreement.
q) The term "Financing Documents" shall include the Guaranties, the
Account Control and Security Agreement, the Share Pledge Agreement and
the Collateral Agent Agreement.
4. OPIC agrees to your requested amendments and to waive any Events of Default
which arose before May 15, 1998 from the rebel incursion and occupation of
the SRL minesite on January 19/20, 1995 and the subsequent discontinuance
of operations there or the May 25, 1997 military coup and subsequent
political events in Sierra Leone. These amendments and waivers will be
effective when:
(i) you can execute and the Sponsors acknowledge this amendment as
provided below;
<PAGE>
(ii) The Company, or the Sponsors on behalf of the Company, have
reimbursed OPIC for its payment to PNC Bank, National
Association ("PNC") for the account of the Noteholders in the
amount of $20,719.89 pursuant to Section 2.07 of the Funding
Agreement dated as of February 16, 1993, as amended, among the
Company, OPIC and PNC, in connection with the assignment by the
Noteholders to OPIC of the Notes;
(iii) OPIC receives (A) the Notes evidencing the Loan, duly endorsed
to OPIC by the Noteholder, (B) an executed assignment from PNC
Bank and (C) an Allonge to each Note in the form attached
hereto as Exhibit A, executed by you and OPIC;
(iv) each other Senior Lender agrees to similar amendments under the
CDC Loan Documents, the DEG Loan Documents, the Ex-Im Loan
Documents and the IFC Loan Documents, on similar conditions and
an executed copy of each such amendment is delivered to OPIC;
(v) the Senior Lenders receive the fully executed Account Control
and Security Agreement, Share Pledge Agreement, Collateral
Agent Agreement, and all documents contemplated thereunder;
(vi) each of the Senior Lenders and Nord have executed and delivered
to OPIC, as insurer, the Second Amendment to Notice of
Assignment in the form attached as Exhibit A to the Account
Control and Security Agreement; and
(vii) you deliver legal opinions from counsel satisfactory to us in
the forms attached.
5. The Company represents, warrants and covenants to OPIC that:
(a) After giving effect to this amendment and the amendments of the other
Senior Lenders contemplated under paragraph 4 (iv) above, no Event of
Default or event that with the passage of time or the giving of notice
or both would constitute an Event of Default now exists, or will exist
immediately following the execution hereof;
(b) All necessary corporate actions on the part of the Company to
authorize the execution, delivery and performance of this amendment
(hereafter, this "amendment" or this "Agreement") and all other
documents or instruments required pursuant hereto have been taken;
this amendment is, and each such other document or instrument to which
the Company is a party when executed and delivered will be, valid and
legally binding upon the Company and enforceable in accordance with
their respective terms;
<PAGE>
(c) The execution, delivery and performance by the Company of this
amendment and all other documents or instruments required pursuant
hereto to which it is a party and all actions and transactions
contemplated hereby and thereby and the use of the proceeds of any
Loan will not (i) violate, be in conflict with, result in a breach of
or constitute (with due notice or lapse of time or both) a default
under the Company's Memorandum and Articles of Association or other
governing documents, any arbitration award or any order of any court
or of any other Governmental Body or authority, or any applicable law,
rule, order or regulation, indenture, agreement or other instrument to
which the Company is a party or by which the Company or any of its
properties is bound and which has not been waived or consented to, or
(ii) result in the creation or imposition of any Lien, charge or
encumbrance of any nature whatsoever, other than Liens permitted
pursuant to the Finance Agreement upon any of the properties of the
Company; and
(d) No consent, approval or authorization of, or filing, registration or
qualification with, any Governmental Body or any other Person is
required to be obtained by the Company in connection with the
execution, delivery or performance of this amendment and all other
documents or instruments required pursuant hereto to which it is a
party which has not already been obtained or completed.
6. COUNTERPARTS. This amendment may be executed in as many counterparts as
may be convenient and shall become binding upon the Company and OPIC when
each party hereto has executed at least one counterpart.
7. GOVERNING LAW; DESCRIPTIVE HEADINGS. THIS AMENDMENT SHALL BE CONSTRUED AND
ENFORCED IN ACCORDANCE WITH THE LAWS OF THE DISTRICT OF COLUMBIA OF THE
UNITED STATES OF AMERICA WITHOUT REGARD TO ITS CONFLICT OF LAWS PROVISIONS.
THE HEADINGS IN THIS AMENDMENT ARE FOR THE PURPOSE OF REFERENCE ONLY AND DO
NOT LIMIT OR AFFECT ITS MEANING.
8. SUCCESSION. This amendment shall inure to the benefit of and be binding
upon the successors and assigns of the parties hereto; PROVIDED, that the
Company shall not, without the prior written consent of OPIC, assign or
delegate all or any part of its interest or obligations hereunder.
9. FURTHER ASSURANCES. From time to time, the Company shall execute and
deliver to OPIC such additional documents as OPIC may reasonably require to
carry out the purposes of this Amendment or any of the Financing Documents
or to preserve and protect the rights of OPIC as contemplated in the
Finance Agreement, herein or in any of the other Financing Documents.
10. REFERENCES TO FINANCE AGREEMENT. Except as expressly provided in this
Agreement, terms, provisions, conditions and agreements of the Finance
Agreement and the other Financing Documents are and shall remain in full
force and effect and hereby ratified and confirmed in all respects. On and
after the effectiveness hereof, each reference in the
<PAGE>
Finance Agreement to "this Agreement", "hereunder", "hereof", "herein" or
words of like import, and each reference to the Finance Agreement in any
Note or other Financing Document, or other agreement, document or
instrument executed and delivered pursuant to the Finance Agreement, shall
be deemed a reference to the Finance Agreement, as amended hereby.
If you and the Sponsors agree with all of the foregoing, please have a duly
authorized officer sign below and return to us by May 15, 1998.
Very truly yours,
OVERSEAS PRIVATE INVESTMENT CORPORATION
By:
-------------------------------------
Its:
<PAGE>
AGREED
SIERRA RUTILE LIMITED
By:
-------------------------
Name:
Title:
AGREED
Our Guaranty to you dated February 28, 1996, the Share Retention Agreement and
the Subordination Agreement, and each other Financing Agreement to which we are
a party are and shall remain in full force and effect and are hereby ratified
and confirmed in all respects. Each of the representations and warranties set
forth in Section 4(a) through (h), (k) and (l) of our Guaranty are true and
correct in all material respects as of the date hereof, provided that references
to Financial Statement shall be deemed to refer to our December 31, 1997 annual,
and subsequent interim, statements.
NORD RESOURCES CORPOATION
By:
-------------------------
Name:
Title:
AGREED
Our Guaranty to you dated February 28, 1996, the Share Retention Agreement and
the Subordination Agreement, and each other Financing Agreement to which we are
a party are and shall remain in full force and effect and are hereby ratified
and confirmed in all respects. Each of the representations and warranties set
forth in Section 4(a) through (h), (k) and (l) of our Guaranty are true and
correct in all material respects as of the date hereof, provided that references
to Financial Statement shall be deemed to refer to our June 30, 1997 annual,
and subsequent interim, statements.
CONSOLIDATE RUTILE LIMITED
By:
-------------------------
Name:
Title:
<PAGE>
EXHIBIT A
ALLONGE
Reference is made to that certain Promissory Note dated ___________, 19__
in the stated principal amount of U.S.________________________________________
___________________ Dollars ($_______________) made by Sierra Rutile Limited
and payable to the order of PNC Bank, National Association, and duly endorsed
by PNC Bank, National Association to the Overseas Private Investment
Corporation.
Such Promissory Note is hereby amended as follows:
1. The outstanding principal amount of the Promissory Note as at May 15,
1998, shall be repayable in accordance with the following schedule:
<TABLE>
<CAPTION>
Date Payment Due Principal Amount Due
---------------- --------------------
<S> <C>
May 15, 1998 $
September 30, 1998 $
September 30, 1999 $
September 30, 2000 $
September 30, 2001 $
</TABLE>
provided, that, on September 30, 2001, the entire unpaid principal
balance of the Promissory Note, together with all accrued interest due
thereunder, shall be paid in full.
2. Interest on the Promissory Note shall be payable annually in arrears
in Dollars on September 30 of each year, beginning with September 30,
1998, until such Promissory Note is paid in full, and the term
"Interest Payment Date" shall refer to each such date.
3. The term "Applicable Rate" shall mean a rate per annum equal to six
point eight seven five per cent (6.875%).
4. The notice requirement for any voluntary prepayment of the Promissory
Note shall be fifteen (15) rather than thirty (30) days and there
shall be no Prepayment Premium. The amount of any partial prepayment
shall be not less than $250,000 and shall be applied to the
outstanding principal installments of the Promissory Note under the
repayment schedule provided above on a pro rata basis.
Except as modified hereby, the Promissory Note shall remain unchanged.
This Allonge shall be affixed to the Promissory Note in such manner as to become
an integral part thereof.
<PAGE>
IN WITNESS WHEREOF, the parties hereto acting by their duly authorized
representatives, have cause this Allonge to be executed and delivered on this
15th day of May, 1998.
SIERRA RUTILE LIMITED
By:
---------------
Name:
Title:
Accepted and Agreed to by:
OVERSEAS PRIVATE INVESTMENT CORPORATION
By:
-----------------------------
Name:
Title:
<PAGE>
ACCOUNT SECURITY AND CONTROL AGREEMENT
AMONG
NORD RESOURCES CORPORATION,
THE CHASE MANHATTAN BANK,
COMMONWEALTH DEVELOPMENT CORPORATION,
DEG - DEUTSCHE INVESTITIONS UND ENTWICKLUNGSGESELLSCHAFT MBH,
EXPORT-IMPORT BANK OF THE UNITED STATES,
INTERNATIONAL FINANCE CORPORATION,
AND
OVERSEAS PRIVATE INVESTMENT CORPORATION
DATED AS OF MAY 15, 1998
<PAGE>
ACCOUNT CONTROL AND SECURITY AGREEMENT
ACCOUNT CONTROL AND SECURITY AGREEMENT, dated as of May 15, 1998 (this
"AGREEMENT"), by and among NORD RESOURCES CORPORATION, a corporation organized
and existing under the laws of the State of Delaware (the "PLEDGOR"), THE CHASE
MANHATTAN BANK, a New York State chartered bank, as securities intermediary (in
such capacity, together with its successors and assigns, the "SECURITIES
INTERMEDIARY"), the OVERSEAS PRIVATE INVESTMENT CORPORATION, an agency of the
United States of America ("OPIC"), COMMONWEALTH DEVELOPMENT CORPORATION ("CDC"),
DEG - DEUTSCHE INVESTITIONS UND ENTWICKLUNGSGESELLSCHAFT MBH ("DEG"),
EXPORT-IMPORT BANK OF THE UNITED STATES ("EX-IM"), and INTERNATIONAL FINANCE
CORPORATION ("IFC" and together with OPIC, CDC, DEG and Ex-Im, the "BANKS").
PRELIMINARY STATEMENTS
(1) The Banks and the Pledgor entered into a Pledge, Assignment and
Security Agreement, dated as of February 28, 1996, as amended by a First
Amendment to Pledge Assignment and Security Agreement dated March 31, 1998 (as
the same may be further amended from time to time, the "PLEDGE AGREEMENT"),
pursuant to which the Pledgor pledged and assigned to the Banks all of its
right, title and interest in and to its rights to receive all but
US$4,564,024.27 of amounts payable under or in connection with OPIC Contract of
Insurance No. A628 and any extensions or renewals thereof or substitutions
therefor (the "OPIC Contract"), entered into by and between OPIC, as insurer,
and the Assignor, together with all proceeds thereof (collectively, the "Excess
Proceeds") as security for the Pledgor's obligations under(i) its Guaranty dated
as of February 28, 1996 (as the same may be amended from time to time, the
"GUARANTY") made for the benefit of the Banks, and (ii) to the extent the
Pledgor may have any obligations thereunder, the First Amendment and Restatement
of Project Funds Agreement dated as of November 17, 1992, (the "PFA") among,
INTER ALIA, the Pledgor and the Banks (the "LIABILITIES").
(2) The Pledge Agreement provides, INTER ALIA, that, so long as no
Default (as defined in the Pledge Agreement) shall have occurred and be
continuing, the parties thereto will use best efforts to appoint a collateral
agent to hold the Excess Proceeds on behalf of the Banks as security for the
Liabilities.
<PAGE>
-2-
(3) Each of the Banks has entered into a waiver and amendment agreement
dated as of May 15, 1998 (collectively, the "WAIVER AND AMENDMENT AGREEMENTS"),
pursuant to which the Banks have agreed to reschedule, and to waive certain
defaults with respect to, the payment obligations guaranteed under the Guaranty,
and to apply a portion of the Excess Proceeds to such payment obligations.
(4) It is a condition precedent to the effectiveness of the Waiver and
Amendment Agreements that the Pledgor shall have made the pledge and assignment
contemplated by this Agreement, which the Pledgor has agreed to do to induce the
Banks to enter into such Waiver and Amendment Agreements.
NOW, THEREFORE, in consideration of the premises and in order to induce the
Banks to enter into the Waiver and Amendment Agreements, the parties hereto
hereby agree as follows:
SECTION 1. ASSIGNMENT. The Pledgor hereby pledges and assigns to the
Banks, and hereby grants to the Banks a security interest in, all of its right,
title, and interest in and to the portion of the Excess Proceeds referenced to
in Section 4 below together with all interest, dividends and other income
thereon and proceeds thereof including, without limitation, the following,
whether now owned or hereafter acquired (collectively, the "COLLATERAL"):
(i) account no. E-00937, a non-interest bearing trust account
maintained by the Pledgor with the Securities Intermediary pursuant to Section
15(e) (the "SECURITIES ACCOUNT"), and all funds (including, without limitation,
that portion of the Excess Proceeds credited to such account as provided in
Section 4, and any other cash balances credited to such account), securities,
certificates, instruments, investment property, and all other property and
assets constituting financial assets from time to time held therein or required
to be deposited therein by the Pledgor and all other rights of the Pledgor in
and arising out of such account
(ii) all assets of whatever type or kind (whether or not such asset is a
Permitted Investment as hereinafter defined), placed or to be place in the
Securities Account, including all securities, investment securities,
instruments, accounts, general intangibles, contract rights, chattel paper,
choses in action, deposit accounts, and certificates of deposit, and the
certificates, certificates of deposit, or other instruments or documents
(including depository receipts, if any) evidencing any of such assets, any
investments made therewith, and all dividends, interest, cash, or other income
on and all proceeds of any of the foregoing now owned or hereafter acquired by
the Pledgor;
(iii) all proceeds of any and all of the foregoing Collateral and all
rights and privileges pertaining thereto (including, without limitation, any
proceeds derived from the sale, conversion, exchange, exercise, payment, or
liquidation
<PAGE>
-3-
thereof, any funds or payments received from any reinvestment of such proceeds
in whatever form the same may be, and proceeds which constitute property of the
types described in clauses (i) and (ii) of this Section 1) and, to the extent
not otherwise included, any indemnity, warranty or guaranty, payable by reason
of loss or damage to or otherwise with respect to any of the foregoing
Collateral and cash.
SECTION 2. SECURITY FOR OBLIGATIONS. The pledge, assignment, and grant in
this Agreement is made by the Pledgor to the Banks to secure: (a) the payment
in full when due of all obligations and liabilities, whether contingent or
otherwise, of the Pledgor now or hereafter existing under the Guaranty and, to
the extent the Pledgor may have any obligations thereunder, the PFA, whether for
principal, interest, premium, indemnity amounts, fees, expenses, or otherwise,
including, without limitation, all obligations of the Pledgor now or hereafter
existing under this Agreement; (b) the performance by the Pledgor of all of its
obligations and liabilities to the Banks under the Guaranty and, to the extent
the Pledgor may have any obligations thereunder, the PFA; and (c) in the event
of any proceeding for the collection or enforcement of any indebtedness,
obligations, or liabilities referred to in clauses (a) and (b) above, the
reasonable expenses of retaking, holding, preparing for sale or lease, selling,
or otherwise disposing of or realizing on the Collateral, together with
attorneys' fees and court costs (all such obligations, liabilities, sums, and
expenses of the Pledgor set forth in clauses (a) through (c) above being herein
collectively called the "OBLIGATIONS"). Without limiting the generality of the
foregoing, this Agreement secures the payment of all amounts which constitute
part of the Obligations and would be owed by the Pledgor to the Banks but for
the fact that they are unenforceable or not allowable due to the existence of a
bankruptcy, reorganization, or similar proceeding involving the Pledgor.
SECTION 3. WAIVER. The Pledgor hereby waives demand, notice, protest,
notice of acceptance of this Agreement, Collateral received or delivered, or
other action taken in reliance hereon, all demands and notices in connection
with the delivery, acceptance, performance, default, or enforcement of any of
the Obligations for which any of the Collateral is pledged and all other demands
and notices of any description, and assents to any extension or postponement of
the time of payment or any other indulgence, to any substitution, exchange, or
release of Collateral, or to the addition or release of any Person primarily or
secondarily liable.
SECTION 4. DELIVERY OF PLEDGED COLLATERAL. Pursuant to a notice delivered
by the Banks to Overseas Private Investment Corporation, as insurer, (in such
capacity, the "INSURER") in the form attached hereto as Exhibit A, Excess
Proceeds in the amount of $5,513,046.56 shall be delivered by the Insurer to the
Securities Intermediary to be held in the Securities Account for the benefit of
the Banks as set forth herein. Upon receipt of such Excess Proceeds, the
Securities Intermediary shall deliver to each of the Banks, with a copy to Nord,
a receipt in the form attached hereto as Exhibit B acknowledging such deposit.
All interest, dividends and other proceeds of the Collateral shall be deposited
in or otherwise
<PAGE>
-4-
credited to the Securities Account by the Securities Intermediary. All
certificates or instruments, if any, representing or evidencing the Collateral
shall be held in the Securities Account by the Securities Intermediary and
remain in its possession in the State of New York, shall be in suitable form for
transfer by delivery, or shall be accompanied by duly executed instruments of
transfer or assignment in blank, all in form and substance satisfactory to the
Banks.
SECTION 5. INVESTMENT OF COLLATERAL HELD IN SECURITIES ACCOUNT.
The Securities Intermediary shall invest all cash deposited or credited to the
Securities Account (including without limitation, the Excess Proceeds and any
interest, dividends or other proceeds of the Collateral deposited in or
otherwise credited to the Securities Account pursuant to Section 4) in Dollar
denominated investments, consisting of (A) securities that, at the date of
investment, are direct obligations of, or obligations fully guaranteed or
insured by, the United States or any agency or instrumentality of the United
States having a maturity of not later than September 30, 1998, and (B) such
other short-term, liquid investments considered to be of high-grade investment
quality by the Pledgor as the Banks may approve in writing (any or all of such
investments referred to herein as "PERMITTED INVESTMENTS") pursuant to written
instruction from Pledgor or, after notice of default as provided in Section 11,
from the Banks. The Excess Proceeds shall be invested initially as set forth on
Schedule 2 annexed hereto. All Permitted Investments shall be registered in the
name of the Security Intermediary for the benefit of the Banks pursuant to this
Agreement. The Banks irrevocably instruct the Securities Intermediary with
respect to any Federal Book-Entry Securities constituting part of the
Collateral, to continuously (a) maintain, or cause or direct to be maintained,
such Collateral in the records of the Federal Reserve Bank of New York for the
sole and exclusive account of the applicable securities intermediary, and
(b) identify, or cause or direct to be identified, on the books and records of
the applicable securities intermediary for the sole and exclusive benefit of the
Securities Intermediary and in the books and records of the Securities
Intermediary as being the property of, or subject to a pledge and security
interest in favor of, the Banks.
SECTION 6. DISPOSITION OF COLLATERAL HELD IN SECURITIES ACCOUNT.
So long as no default shall have occurred and be continuing under the
Guaranty, amounts shall be disbursed from the Securities Account as follow:
A Unless the Securities Intermediary has received contrary instructions from
the Banks, the Securities Intermediary shall disburse from the Securities
Account to each of the Banks on September 30, 1998, the respective amount
set forth next to its name on the attached Exhibit C. The Banks agree to
apply such amounts to the obligations of SRL guaranteed by the Pledgor
under the Guaranty coming due on
<PAGE>
-5-
September 30, 1998 pursuant to the Waiver and Amendment Agreements. For
purposes of such disbursement, the Excess Proceeds shall not constitute
"Distribution Moneys" as such term is defined in the Security Sharing and
Intercreditor Agreement dated as of November 17, 1993, among the Banks and
Sierra Rutile Limited, a corporation organized and existing under the laws
of Sierra Leone and indirectly 50% owned by the Pledgor ("SRL"). In the
event the Collateral, after liquidation of all Permitted Investments, is
not sufficient to make such payments in full on such date, each payment
shall instead be made in proportion to Pro-Rata Share (as set forth on
Exhibit C).
B In the event the Banks receive a notice of prepayment concerning the
Obligations, the Banks agree, at the request of the Pledgor, to issue a
notice of prepayment to the Securities Intermediary directing that the
Securities Intermediary disburse to the Banks from the Securities Account
on the prepayment date the amount specified by the Pledgor in its request
to the Banks, and the Securities Intermediary shall disburse to each Bank a
percentage of such amount equal to the respective percentage set forth next
to its name on the attached Exhibit C (such percentage, its "PRO RATA
SHARE").
C The Securities Intermediary shall take any other action with respect to
disbursements from the Securities Account pursuant to written instructions
from the Banks.
D Upon notice from the Banks that the Obligations have been paid in full, the
Securities Intermediary shall disburse any balance remaining in the
Securities Account to or at the direction of the Pledgor.
SECTION 7. REPRESENTATIONS AND WARRANTIES. The Pledgor represents and
warrants as follows:
(a) It has established the Securities Account with the Securities
Intermediary.
(b) The Collateral held by it or on its behalf shall be fully paid and
nonassessable, and all documentary, stamp, or other taxes or fees that may be
owing in connection with the issuance, transfer, and pledge thereof hereunder
shall have been paid by it or on its behalf.
<PAGE>
-6-
(c) This Agreement creates a valid security interest in the Collateral
purported to be pledged and assigned by the Pledgor hereunder securing the
payment of the Obligations.
(d) Each item of Collateral held in the Securities Account constitutes
a "security entitlement" (as defined in Article 8 of the Uniform Commercial Code
as in effect in the State of New York (the "UCC")); all of such Collateral is
located in the State of New York; the security interest created by this
Agreement in the Securities Account and such Collateral is perfected under the
UCC, and such security interest, as so perfected, is first priority.
(e) The Pledgor is the legal and beneficial owner of and has good title
to the Collateral purported to be pledged and assigned by it hereunder, free and
clear of any lien thereon, other than the lien created under the Pledge
Agreement . No effective financing statement or other instrument similar in
effect covering all or any part of such Collateral is on file in any recording
office, except such as may have been filed in favor of the Banks relating to
this Agreement.
(f) The Permitted Investments, when deposited into the Securities
Account, will constitute "financial assets", as defined in Article 8 of the UCC.
(g) The Pledgor is not a party to any agreement with respect to the
establishment, management, or operation of the Securities Account or investment
of amounts deposited or held therein, except for this Agreement.
(h) The Banks have sole "control" (as defined in Article 8 of the UCC)
of the Securities Account and the financial assets held therein.
(i) The Pledgor has neither (i) borrowed any money from, (ii) been
extended any credit by, nor (iii) become otherwise obligated to pay any money
to, the Securities Intermediary, other than the fees or expenses payable to the
Securities Intermediary pursuant to Section 12(b).
(j) There are no conditions precedent to the effectiveness of this
Agreement that have not been satisfied or waived;
(k) This Agreement has been duly and validly authorized by the Pledgor,
is binding and enforceable against the Pledgor in accordance with its terms,
does not violate any provision of any law, rule, regulation, order, judgment or
decree applicable to Pledgor, and no consent of any other party is necessary to
accomplish the pledge, assignment and grant of security interest contemplated
hereby
(l) The Pledgor is now, and after execution and delivery of this
Agreement will continue to be, solvent and no bankruptcy or insolvency
proceedings are pending or contemplated by or against the Pledgor
<PAGE>
-7-
SECTION 8. FURTHER ASSURANCES. (a) The Pledgor agrees that from time to
time, at its expense, it will promptly execute and deliver all further
instruments and documents, and take all further action, that may be necessary or
desirable, or that the Banks may request, in order to perfect, protect, and
preserve the pledge, assignment, and security interest granted or purported to
be granted hereby or to enable the Banks to exercise and enforce their rights
and remedies hereunder with respect to any Collateral. Without limiting the
generality of the foregoing, the Pledgor will execute and file such assignments,
certificates, supplemental writings, financing or (at the request of the Banks)
continuation statements, or amendments thereto, and such other instruments or
notices, and do all other acts and things, as may be necessary or desirable, or
as the Banks may request, in order to evidence more fully and perfect and
preserve the pledge, assignment and security interest granted or purported to be
granted hereby.
(b) The Pledgor hereby further authorizes the Banks to file one or more
financing or continuation statements, and amendments thereto (any such financing
or continuation statements or amendments to be delivered by the Pledgor to the
Banks in form sufficient for filing and with instructions for filing thereof),
relating to all or any part of the Collateral without the signature of the
Pledgor where permitted by law. A photographic or other reproduction of this
Agreement or any financing statement covering the Collateral or any part thereof
shall be sufficient as a financing statement where permitted by law.
(c) The Pledgor will furnish to the Banks from time to time, and no
less than once every fiscal quarter of each Fiscal Year of the Pledgor,
statements and schedules further identifying and describing the Collateral and
such other reports in connection with the Collateral as the Banks may reasonably
request, all in reasonable detail.
SECTION 9. COVENANTS. The Pledgor covenants and agrees that, so long as
any of the Obligations shall remain unpaid, unless the Banks shall otherwise
consent in writing, the Pledgor will:
(a) not make any withdrawal from or direct that any payment be debited
from the Securities Account other than as expressly permitted by this Agreement;
(b) not permit any Person other than the Banks to have "control" (as
defined in Article 8 of the UCC) of the Securities Account or any of the
financial assets held therein, including, without limitation, as a result of the
grant of a security interest in any such Securities Account or assets to the
Chase Manhattan Bank or any other Person acting as securities intermediary with
respect to such Securities Account and assets;
<PAGE>
-8-
(c) pay all documentary, stamp, registration, or other taxes or fees,
if any, to which this Agreement may be subject or give rise, and to indemnify
the Banks against any and all liabilities with respect to or resulting from any
delay or omission on the part of the Pledgor to pay any such duties, taxes, or
fees;
(d) not (i) borrow any money from, (ii) allow any credit to be extended
to it by, or (iii) become otherwise obligated to pay any money to, the
Securities Intermediary, other than the fees or expenses payable to the
Securities Intermediary pursuant to Section 12(b); and
(e) not take any action in connection with the Collateral that would
materially impair the value of the Collateral or that would impair the interest
or rights of the Banks therein.
SECTION 10. BANKS MAY PERFORM. If the Pledgor fails to perform any
agreement contained herein, the Banks, or any of them, may perform, or cause
performance of, such agreement, and the expenses of the Banks incurred in
connection therewith shall be payable by the Pledgor under Section 12(b).
SECTION 11. REMEDIES. If any default under the Guaranty shall have
occurred and be continuing:
(a) The Banks, and each of them, shall be entitled to exercise all of
the rights, powers and remedies (whether vested in them by this Agreement, by
law, in equity, by statute or otherwise), to the maximum extent permitted by
applicable law, for the protection and enforcement of their rights in respect of
the Collateral, and to exercise the following rights to the maximum extent
permitted by applicable law:
(i) to have and exercise all of the rights and remedies with
respect to the Collateral of a pledgeholder or a secured party under the UCC,
and such additional rights and remedies to which a pledgeholder or secured party
is entitled under the laws in effect in any jurisdiction where any rights and
remedies hereunder may be asserted, including, without limitation, the right to
exercise all powers of ownership pertaining to the Collateral (whether or not
transferred into the name of the Banks) as if the Banks were the sole and
absolute owner thereof;
(ii) to direct the Securities Intermediary to transfer such
Bank's Pro Rata Share of the Collateral from the Securities Account to, or to
the account of, such Bank. Upon receipt of any such instruction from any Bank,
the Securities Intermediary shall notify each other Bank thereof, and shall
transfer to such Bank its Pro Rata Share of the Collateral in accordance with
wiring instructions delivered by such Bank to the Securities Intermediary. Upon
any such transfer to a
<PAGE>
-9-
Bank, such Bank's Pro Rata Share of the Collateral shall be reduced to zero,
and the Pro Rata Shares of the other Banks with respect to the remaining
Collateral shall be adjusted accordingly.
SECTION 12. CONCERNING THE SECURITIES INTERMEDIARY.
(a) POWERS OF THE SECURITIES INTERMEDIARY. The Pledgor and each of the
Banks hereby designates and appoints The Chase Manhattan Bank as Securities
Intermediary and agrees that the Securities Intermediary shall exercise such
powers under this Agreement as are delegated to the Securities Intermediary by
the terms hereof. The Chase Manhattan Bank hereby agrees to act as Securities
Intermediary upon the express terms and conditions contained in this Agreement.
(b) COMPENSATION AND REIMBURSEMENT OF SECURITIES INTERMEDIARY. (i)
The Pledgor upon execution hereof shall pay the Securities Intermediary the fees
payable pursuant to Schedule I hereto.
(ii) The Pledgor shall reimburse the Securities Intermediary upon
request for all expenses, disbursements, and advances incurred or made by the
Securities Intermediary in implementing any of the provisions of this Agreement,
including, without limitation, compensation and the expenses and disbursements
of its counsel and agents, except any such expense, disbursement, or advance as
may arise from its gross negligence or willful misconduct.
(iii) The Securities Intermediary shall promptly notify the Banks
of any failure by the Pledgor to pay the Securities Intermediary for any fees
and expenses due and payable to the Securities Intermediary pursuant to this
Section 12(b).
(c) SECURITIES INTERMEDIARY'S WAIVER OF LIEN ON COLLATERAL. The
Securities Intermediary hereby waives any Lien, any right of setoff, and any
other claim or right that it may have against or on the Collateral, including,
without limitation the Securities Account, express or implied, statutory or
otherwise.
(d) RESPONSIBILITIES OF THE SECURITIES INTERMEDIARY. (i) The
Securities Intermediary shall exercise the same degree of care toward the
Collateral as it exercises toward its own similar property and shall not be held
to any higher standard of care under this Agreement.
(ii) The Securities Intermediary shall be obligated to perform
only such duties as are expressly set forth in this Agreement. No implied
covenants or obligations shall be inferred from this Agreement against the
Securities Intermediary, nor shall the Securities Intermediary be bound by the
provisions of any other agreement.
<PAGE>
-10-
(iii) The Securities Intermediary shall not be liable hereunder
except for its own gross negligence or willful misconduct and the Pledgor agrees
to indemnify the Securities Intermediary and any predecessor securities
intermediary for and hold it harmless as to any and all documented loss,
liability, claim, damage, or expense, including, without limitation, taxes other
than taxes based on the income of the Securities Intermediary and reasonable
attorney's fees and expenses, incurred without gross negligence or willful
misconduct on the part of the Securities Intermediary and arising out of or in
connection with the Securities Intermediary's duties under this Agreement.
Anything in this agreement to the contrary notwithstanding, in no event shall
the Securities Intermediary be liable for special, indirect or consequential
loss or damage of any kind whatsoever (including but not limited to lost
profits), even if the Securities Intermediary has been advised of the likelihood
of such loss or damage and regardless of the form of action. Specifically and
without limiting the foregoing, the Securities Intermediary shall in no event
have any liability in connection with its investment, reinvestment or
liquidation, in good faith and in accordance with the terms hereof, of any
Collateral held by it hereunder, including, without limitation, any liability
for any delay not resulting from gross negligence or willful misconduct in such
investment, reinvestment or liquidation, or for any loss of income incident to
any such delay. The Securities Intermediary shall have the right to liquidate
any investments held, in order to provide funds necessary to make required
payments under this Agreement. The Securities Intermediary in its capacity as
agent hereunder shall not have any liability for any loss sustained as a result
of any investment made pursuant to the instructions of the parties hereto or as
a result of any liquidation of any investment prior to its maturity or for the
failure of the parties to give the Securities Intermediary instructions to
invest or reinvest fund or any earnings thereon.
(iv) In no event shall the Securities Intermediary be liable (A)
for acting in accordance with entitlement orders or other instructions,
directions, or requests from the Banks or (B) for special or consequential
damages.
(v) The Securities Intermediary shall be entitled to
conclusively rely upon any order, judgment, certification, instruction, notice,
opinion, or other writing delivered to it in compliance with the provisions of
this Agreement without being required to determine the authenticity or the
correctness of any fact stated therein or the propriety or validity of service
thereof. The Securities Intermediary may act in reliance upon any instrument
comporting with the provisions of this Agreement or signature believed by it to
be genuine and may assume that any Person purporting to give notice or receipt
or advice or make any statement or execute any document in connection with the
provisions hereof has been duly authorized to do so.
<PAGE>
-11-
(vi) At any time the Securities Intermediary may request in writing
an instruction in writing from the Banks, the Securities Intermediary may at its
own option include in such request the course of action it proposes to take and
the date on which it proposes to act, regarding any matter arising in connection
with its duties and obligations hereunder. The Securities Intermediary shall
not be liable for acting without the Banks' consent in accordance with such a
proposal on or after the date specified therein, provided that the specified
date shall be at least two (2) Business Days after the Banks receive the
Securities Intermediary's request for instructions and its proposed course of
action, and provided further that, prior to so acting, the Securities
Intermediary has not received the written instructions requested.
(vii) The Securities Intermediary does not have any interest in
the Collateral deposited hereunder but is serving only as securities
intermediary under the Securities Account and has only possession thereof.
(viii) The Securities Intermediary makes no representation as to
the validity, value, genuineness or collectability of any security or other
document or instrument held by or delivered to it.
(ix) The Securities Intermediary shall not be called upon to
advise any party as to selling or retaining, or taking or refraining from taking
any action with respect to, any securities or other property and assets
deposited hereunder.
(x) No provision of this Agreement shall require the Securities
Intermediary to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties, or in the exercise of any of
its rights or powers, hereunder.
(xi) For purposes of the duties of the Securities Intermediary
hereunder a default shall occur or be deemed to occur when the Securities
Intermediary shall have received a written notice from any Bank so stating.
(xii) The provisions of this Section 12 shall survive termination
of this Agreement and/or the closing of the Securities Account by the Securities
Intermediary.
(e) THE SECURITIES ACCOUNT. (1) The Securities Intermediary has
established the Securities Account for the benefit of the Banks pursuant to this
Agreement. The Securities Intermediary has styled the Securities Account to
read: "The Chase Manhattan Bank, as Securities Intermediary under the Account
Control And Security Agreement, dated as of May 15, 1998, by and among for Nord
Resources Corporation, the Overseas Private Investment Corporation, Commonwealth
Development Corporation, DEG - Deutsche Investitions Und
Entwicklungsgesellschaft Mbh, Export-Import Bank of the United States, and
<PAGE>
-12-
International Finance Corporation, Collateral Account." The Securities
Intermediary shall not change the name or account number of the Securities
Account without the prior written consent of the Banks and notice to the
Pledgor. The Securities Intermediary shall maintain the Securities Account and
shall not terminate or close the Securities Account without the prior written
consent of the Banks and notice to the Pledgor, except as provided in Section
12(f). The Securities Account shall at all times (A) be maintained at an office
of the Securities Intermediary located in the State of New York, which office
shall be identified on the account statements pertaining to the Securities
Account, and (B) be in the exclusive possession of, and under the exclusive
dominion and control of, the Securities Intermediary acting pursuant to the
terms of this Agreement or otherwise at the direction of the Banks. The
Securities Intermediary shall provide to the Banks (1) copies of all account
statements, confirmations, and other correspondence relating to the Securities
Account that is provided to the Pledgor, (2) a monthly report of all of the
financial assets held in, and transactions in connection with, the Securities
Account, and (3) any other reports or other correspondence that the Banks, or
any of them, may reasonably request.
(ii) The Securities Intermediary agrees to accept all funds,
securities, instruments, investment property, financial assets, and other
property and assets, including, without limitation, the Excess Proceeds (or any
portion thereof), constituting Collateral to be delivered by or on behalf of the
Pledgor to the Securities Intermediary pursuant to Section 4, and promptly to
deposit all such Collateral into the Securities Account. Any and all Collateral
delivered to the Securities Intermediary to be held in the Securities Account
and the Pledgor's rights to such Collateral shall be subject to the terms of
this Agreement without any further documentation. The Pledgor irrevocably
directs the Securities Intermediary to make all notations in the Securities
Intermediary's records pertaining to the Securities Account that are necessary
or appropriate to reflect the security interest granted hereunder to the Banks.
(iii) The Securities Intermediary shall hold the Securities
Account during the term of this Agreement as a securities intermediary for such
account, and shall treat the funds, securities, instruments, investment
property, financial assets, and other property and assets, including, without
limitation, the Excess Proceeds, constituting Collateral, and all rights related
thereto, now or hereafter deposited in or credited to the Securities Account as
financial assets, pledged by the Pledgor to the Banks. The Securities
Intermediary agrees to hold such Collateral in the State of New York, including,
without limitation, the Excess Proceeds (including, without limitation, any free
credit balances), for the benefit of the Banks. All amounts held in the
Securities Account shall constitute a part of the Collateral and shall not
constitute payment of any Indebtedness or any other obligation of the Pledgor
until applied as provided in this Agreement.
<PAGE>
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(iv) The Securities Intermediary hereby unconditionally agrees,
and the other parties hereto acknowledge and agree, that (A) the Securities
Intermediary will comply with any and ALL WRITTEN INSTRUCTIONS (each being an
"entitlement order" as defined in Art. 8 of the UCC and notification
communicated to the Securities Intermediary directing transfer, investment or
redemption of any financial asset in, or the withdrawal of any financial asset
from, the Securities Account) and other instructions originated by the Banks
with respect to the Securities Account (or the financial assets deposited
therein or credited thereto) without further consent by the Pledgor and
notwithstanding any contrary instructions to the Securities Intermediary from
the Pledgor, and (B) the Pledgor shall have only such rights to transfer,
invest, redeem or withdraw such financial assets as specifically provided in a
written instruction by the Banks to the Securities Intermediary.
(v) The Securities Intermediary represents, warrants and
covenants as follows: (A) the Securities Account has been established by the
Securities Intermediary for the Pledgor and is subject to this Agreement; (B)
Securities Intermediary will not take any action with regard to the Securities
Account or the Collateral except in accordance with this Agreement (C) the
Securities Intermediary hereby agrees that all items of income (including,
without limitation, dividends, interest and other distributions on the financial
assets contained in the Securities Account), gain, expense, and loss recognized
in the Securities Account shall be reported by the Securities Intermediary in
the name and under the tax identification number of the Pledgor; (D) The Chase
Manhattan Bank, acting solely in its capacity as Securities Intermediary under
this Agreement, has not extended, and agrees that it will not extend, any credit
to the Pledgor; (E) the Securities Intermediary shall at all times maintain an
office located in the State of New York; (F) it is a bank which regularly
accepts in the ordinary course of its business securities of the same type as
the Collateral as a custodial service for customers and maintains in the State
of New York securities accounts for its customers and will be acting in such
capacity at all times hereunder; (G) it will maintain its offices and books and
records with respect to its securities accounts in the State of New York; (H) it
will not be a "clearing corporation" as defined in Section 8-102(3) of the UCC;
and (I) it will at all times maintain a book-entry account with the Federal
Reserve Bank of New York.
(f) CLOSING OF SECURITIES ACCOUNT. (i) The Securities Intermediary
may resign or close the Securities Account at any time by giving at least 60
days' written notice to the Pledgor and the Banks. The Banks may enter into an
agreement with a successor securities intermediary during such notice period, at
which time the Securities Intermediary shall keep the Securities Account open
and hold all of the Collateral deposited therein or credited thereto, pending
distribution to such successor, until all fees owed to the Securities
Intermediary pursuant to the provisions of Section 12(b) are paid.
<PAGE>
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(ii) The Banks may cause the Securities Account to be closed upon
written notice to the Securities Intermediary signed by the Banks. Such closing
shall take effect upon delivery of the Collateral then in the possession of the
Securities Intermediary or maintained in its name to a successor securities
intermediary designated in writing by the Banks, or directly to the Banks in
accordance with their Pro Rata Shares, and the Securities Intermediary shall
thereupon be discharged from all obligations under this Agreement and shall have
no further duties or responsibilities in connection herewith. The Securities
Intermediary shall deliver the Collateral without unreasonable delay after
receiving the Banks' notice.
(iii) Upon termination of this Agreement pursuant to Section 16
(a), but subject to the provisions of Section 16 (b), the Securities
Intermediary promptly shall turn over all Collateral then in its possession or
maintained in its name to the Pledgor and cause the Securities Account to be
closed.
SECTION 13. CERTAIN RIGHTS, POWERS AND REMEDIES. The rights, powers and
remedies of the Banks hereunder are in addition to all rights, powers and
remedies given by applicable law, the Guaranty, or any other document or
agreement. The exercise by the Banks or any of them of any one or more of the
rights, powers and remedies herein shall not be construed as a waiver of any
other rights, powers and remedies, including, without limitation, any other
rights of setoff, or rights under any other document or agreement, and, in like
manner, the exercise by the Banks, or any of them, of any right, power or remedy
under applicable law or another document or agreement shall not diminish or
otherwise affect their rights, powers and remedies hereunder.
SECTION 14. AMENDMENTS; ETC. No amendment or waiver of any provision of
this Agreement nor consent to any departure by the Pledgor therefrom shall in
any event be effective unless the same shall be in writing and signed by each of
the Banks, the Pledgor, and the Securities Intermediary, and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given.
SECTION 15. ADDRESSES FOR NOTICES. Each notice, demand, report, or other
communication to any party hereof relating to this Agreement shall be in
writing, shall be hand-delivered or sent by mail (postage prepaid), air courier,
or facsimile transmission (with a copy by mail to follow, receipt of which copy
shall not be required to effect notice), and shall be deemed duly given when
received, in each case to the address for such party on Schedule 3 attached
hereto, or to such other address or number as such party shall have last
specified by written notice to the other parties.
SECTION 16. CONTINUING PLEDGE, ASSIGNMENT, AND SECURITY INTEREST;
TERMINATION. (a) This Agreement shall create a continuing pledge and
<PAGE>
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assignment of, and security interest in, the Collateral and shall remain in full
force and effect until the Obligations shall have been indefeasibly paid in full
in Dollars and (ii) be binding upon the Pledgor, its successors and permitted
assigns. Upon the indefeasible payment in full in Dollars of the Obligations,
the security interest granted hereby shall terminate and all rights to the
Collateral shall revert to the Pledgor. Upon any such termination, the Banks
will, at the Pledgor's expense, execute and deliver to the Pledgor and the
Securities Intermediary such documents as the Pledgor and Securities
Intermediary shall reasonably request to evidence such termination.
(b) To the extent that any payments on the Obligations or proceeds of
the Collateral are subsequently invalidated, declared to be fraudulent or
preferential, set aside or required to be repaid to a trustee, debtor in
possession, receiver or other Person under any bankruptcy law, other law or
equitable cause, then to such extent the Obligations so satisfied shall be
revived and continue as if such payment or proceeds had not been received by the
Banks, and the Banks' security interest, rights, powers and remedies hereunder
shall continue in full force and effect. In such event, this Agreement shall be
automatically reinstated if it shall theretofore have been terminated pursuant
to this Section 16.
(c) The provisions of Section 16(b) shall survive any termination of
this Agreement.
SECTION 17. GOVERNING LAW; TERMS. THIS AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REFERENCE TO CONFLICTS OF LAW OTHER THAN AS PROVIDED IN SECTION 9-103 OF THE
UCC. UNLESS OTHERWISE DEFINED HEREIN OR IN THE FINANCE AGREEMENT, TERMS DEFINED
IN ARTICLE 8 OR 9 OF THE UCC ARE USED HEREIN AS THEREIN DEFINED.
SECTION 18. WAIVER OF JURY TRIAL. THE PLEDGOR, THE SECURITIES
INTERMEDIARY, AND THE BANKS HEREBY IRREVOCABLY WAIVE, TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE
ARISING OUT OF, IN CONNECTION WITH, RELATED TO, OR INCIDENTAL TO THE
RELATIONSHIP BETWEEN THEM ESTABLISHED BY THIS AGREEMENT OR ANY OTHER INSTRUMENT,
DOCUMENT, OR AGREEMENT ENTERED INTO IN CONNECTION WITH THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
SECTION 19. JURISDICTION AND CONSENT TO SUIT (a) Without prejudice to
any Bank's right to bring suit in any appropriate domestic or foreign
jurisdiction, any proceeding to enforce this Agreement may be brought by any
Bank in any state or federal court of competent jurisdiction of the County of
New York, the State of
<PAGE>
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New York, or in any other jurisdiction where the Pledgor or any property of the
Pledgor may be found. The Pledgor hereby irrevocably waives any present or
future objection to any such venue, and irrevocably and unconditionally consents
and submits, for itself and in respect of any of its property, to the
nonexclusive jurisdiction of any such court. Final judgment against the Pledgor
in any action or proceeding arising out of or relating to this Agreement shall
be conclusive and may be enforced in any other jurisdiction within or outside
the United States of America by suit on the judgment, a certified or exemplified
copy of which shall be conclusive evidence of the fact and of the amount of its
obligations.
(b) The Pledgor irrevocably designate and appoint Spitzer & Feldman PC
as agent for service of process in the State of New York as its authorized agent
to receive, accept, and acknowledge on its behalf service of process in any
proceeding and has provided the Banks and the Securities Intermediary with
evidence of the prepayment in full of the fees of such agent. The Pledgor
agrees that service of process, writ, judgment, or other notice of legal process
upon said agent shall be deemed and held in every respect to be effective
personal service upon it. The Pledgor shall maintain such appointment (or that
of a successor satisfactory to the Banks) continuously in effect at all times
while the Pledgor is obligated under this Agreement. Nothing herein shall
affect any Bank's right to serve process in any other manner permitted by
applicable law.
SECTION 20. MISCELLANEOUS
(a) The Securities Intermediary shall not be liable for any action
taken or omitted by it in good faith unless a court of competent jurisdiction
determines that the Securities Intermediary's willful misconduct was the primary
cause of any loss to the parties hereto. In the administration of the account
hereunder, the Securities Intermediary may execute any of its powers and perform
its duties hereunder directly or through agents or attorneys and may, consult
with counsel, accountants and other skilled persons to be selected and retained
by it. The Securities Intermediary shall not be liable for anything done,
suffered or omitted in good faith by it in accordance with the advice or opinion
of any such counsel, accountants or other skilled persons.
(b) Each party hereto, except the Securities Intermediary, shall, in
the notice section of this agreement, provide the Securities Intermediary with
their Tax Identification Number (TIN), if any, as assigned by the Internal
Revenue Service. All interest or other income earned under the Agreement shall
be allocated and paid as provided herein and reported by the recipient to the
Internal Revenue Service as having been so allocated and paid.
(c) The Securities Intermediary shall not incur any liability for
following the instructions herein contained or expressly provided for, or
written instructions given by the parties hereto.
<PAGE>
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(d) In the event that the Securities Intermediary shall be uncertain as
to its duties or rights hereunder or shall receive instructions, claims or
demands from any party hereto which, in its opinion, conflict with any of the
provisions of this Agreement, it shall be entitled to refrain from taking any
action and its sole obligation shall be to keep safely all property held in
escrow until it shall be directed otherwise in writing by all of the other
parties hereto or by a final order or judgment of a court of competent
jurisdiction.
(ii) In the event funds transfer instructions are given (other
than in writing at the time of execution of the Agreement), whether in writing,
by telecopier or otherwise, the Securities Intermediary is authorized to seek
confirmation of such instructions by telephone call-back to the person or
persons designated on Schedule 2 hereto, and the Securities Intermediary may
rely upon the confirmations of anyone purporting to be the persons so
designated. The persons and telephone numbers for call-backs may be changed
only in writing actually received and acknowledged by the Securities
Intermediary. The parties to this Agreement acknowledge that such security
procedure is commercially reasonable.
(ii) It is understood that the Securities Intermediary in any
funds transfer to or for the benefit of a Bank or the Pledgor hereunder may rely
solely upon any account numbers or similar identifying number provided by such
party to identify (i) the beneficiary, (ii) the beneficiary's bank, or (iii) an
intermediary bank. The Securities Intermediary may apply any of the Collateral
for any payment order it executes using any such identifying number, even where
its use may result in a person other than the Bank being paid, or the transfer
of funds to a bank other than the Ban's bank, or an intermediary bank
designated.
SECTION 21. SEVERABILITY. If any provision of this Agreement is
prohibited or held to be invalid, illegal or unenforceable in any jurisdiction,
the parties hereto agree, to the fullest extent permitted by law, that (i) the
validity, legality and enforceability of the other provisions in such
jurisdiction shall not be affected or impaired thereby and (ii) any such
prohibition, invalidity, illegality or unenforceability shall not render such
provision prohibited, invalid, illegal, or unenforceable in any other
jurisdiction.
SECTION 22. SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of the parties hereto,
PROVIDED that the Pledgor shall not, without the Banks' prior written consent,
assign or delegate all or any part of its interests or obligations herein or
hereunder.
SECTION 23. DESCRIPTIVE HEADINGS. The headings in this Agreement are for
the purpose of reference only and do not limit or affect its meaning.
<PAGE>
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SECTION 24. EXECUTION IN COUNTERPARTS. This Agreement may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Facsimile copies hereof shall be deemed to be originals for all purposes
hereunder.
[Balance of this page intentionally left blank]
<PAGE>
-19-
IN WITNESS WHEREOF, each party hereto has caused this Agreement to be
executed and delivered on its behalf by its duly authorized representative as of
the date first above written.
<PAGE>
SIERRA RUTILE LIMITED
SHARE PLEDGE AGREEMENT
THIS SIERRA RUTILE LIMITED SHARE PLEDGE AGREEMENT (the "Agreement") dated
as of May 15, 1998, made by SIERRA RUTILE HOLDINGS LIMITED, a corporation
organized and existing under the laws of the British Virgin Islands (the
"Shareholder"), to COMMONWEALTH DEVELOPMENT CORPORATION ("CDC"), DEG-DEUTSCHE
INVESTITIONS-UND ENTWICKLUNGSGESELLSCHAFT mbH ("DEG"), EXPORT-IMPORT BANK OF THE
UNITED STATES ("ExIm Bank"), INTERNATIONAL FINANCE CORPORATION ("IFC") and
OVERSEAS PRIVATE INVESTMENT CORPORATION ("OPIC" and, together with CDC, DEG ExIm
Bank, and IFC, the "Banks" and individually each a "Bank").
WHEREAS, Sierra Rutile Limited (the "Company") and each of the Banks have
entered into separate amendment agreements providing the modification of certain
of the terms and provisions governing certain outstanding indebtedness of the
Company owing to the respective Banks (collectively, the "Amendments");
WHEREAS, it is a condition to the effectiveness of the Amendments that the
Shareholder execute and deliver an equitable mortgage agreement in substantially
the form hereof delivering by way of an equitable mortgage as collateral
security for the Company's payment and performance obligations (collectively,
the "Obligations") with respect to the principal, interest, expenses, costs and
all other amounts payable by the Company to the Banks in connection with the
agreements amended by the Amendments (such agreements, as so amended being
referred to as the "Loan Agreements"), 38,685,017 shares of the Company held by
the Shareholder, constituting all of the outstanding shares of the Company;
WHEREAS, the Shareholder wishes to grant an equitable mortgage and security
interests in favor of the Banks for the benefit of the Banks as provided herein.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants contained herein and for other good and valuable consideration, the
receipt of which is hereby acknowledged, the Shareholder hereby agrees as
follows:
1. GRANT OF SECURITY INTEREST. (a) As collateral security for the
Obligations, the Shareholder hereby delivers by way of equitable mortgage to the
Banks, for the benefit of the Banks, its shares in the Company described in
SCHEDULE 1 hereto, together with all income therefrom, increases therein and
proceeds thereof, now or hereafter owned or acquired by the Shareholder
(collectively, the "Mortgaged Shares") and grants to the Banks, a lien on and
<PAGE>
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security interest in the Mortgaged Shares. All certificates representing or
evidencing the Mortgaged Shares shall be delivered to and held by the Banks or a
collateral agent designated by them, and shall be accompanied by duly executed
instruments of transfer or assignment in blank, all in a form reasonably
satisfactory to the Banks. The Shareholder shall promptly create and make a
notation of the particulars of this Agreement on a Register of Mortgages and
Charges and Other Encumbrances of the Shareholder, maintain such Register at its
Registered Office and cause a copy thereof to be filed with the Register of
Companies in the British Virgin Islands.
(b) If the Shareholder shall become entitled to receive, in connection
with or in substitution or exchange for any of the Mortgaged Shares, any:
(i) other shares or certificates, including, without limitation,
any certificate representing a stock bonus or stock dividend or in connection
with any increase or reduction of capital, reclassification, merger,
consolidation, sale of assets, combination of shares, stock split, spin-off or
split-off;
(ii) option, warrant or right, whether as an addition to or in
substitution or in exchange for any of the Mortgaged Shares, or otherwise;
(iii) dividend or distribution payable in property, including
securities issued by an issuer other than the issuer of the Mortgaged Shares; or
(iv) cash dividends or other distributions of any sort;
then, except as otherwise provided in Clause 2, such property shall be delivered
directly to the Banks and, to the extent any such property is delivered,
inadvertently or otherwise, to the Shareholder, the Shareholder shall accept the
same as the agent for the Banks and shall hold the same in trust for the Banks
and shall (except as provided below) deliver them forthwith to the Banks in the
exact form received with, as applicable, the Shareholder's endorsement when
necessary, or appropriate stock powers duly executed in blank, to be held by the
Banks subject to the terms hereof, as part of the Mortgaged Shares and subject
to the pledge, lien and security interest granted herein with respect thereto.
<PAGE>
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2. CASH DIVIDENDS; VOTING RIGHTS. Unless an Event of Default as defined
in any of the Loan Agreements (as so defined, an "Event of Default") shall have
occurred and be continuing, the Shareholder shall be entitled to receive all
cash dividends paid in respect of the Mortgaged Shares, to vote the Mortgaged
Shares and to give consents, waivers and ratifications in respect of the
Mortgaged Shares; PROVIDED, HOWEVER, that no vote shall be cast or consent,
waiver or ratification given or action taken that would materially impair any of
the Mortgaged Shares or be inconsistent with or violate any provision of this
Agreement or would otherwise impair the security for the Obligations or
adversely affect the position of Banks under this Agreement or any of the
Obligations.
3. REMEDIES; RIGHTS UPON AN EVENT OF DEFAULT. (a) Upon and after the
occurrence of an Event of Default, the Banks may, without demand or notice of
any kind (except the notice specified below of time and place of private sale)
to or upon the Shareholder or any other person (all of which are, to the extent
permitted by law, hereby expressly waived), forthwith realize upon the Mortgaged
Shares or any part thereof, and may forthwith, or may agree to, sell or
otherwise dispose of and deliver the Mortgaged Shares or any part thereof or
interest therein, in one or more portions at a private sale or sales, at such
prices and on such terms as it may deem best, for cash or on credit, or for
future delivery with or without assumption of any credit risk, with the right to
the Banks or any other purchaser to purchase upon any such sale the whole or any
part of the Mortgaged Shares free of any right or equity of redemption in the
Shareholder, which right or equity is hereby expressly waived and released.
(b) The proceeds of any such disposition or other action by the Banks
shall be applied as follows:
(i) first, to the costs and expenses incurred in connection
therewith or incidental thereto or to the care or safekeeping of any of the
Mortgaged Shares or in any way relating to the rights of the Banks hereunder,
including reasonable attorneys' fees and legal expenses;
(ii) second, to the satisfaction in full of the Obligations;
(iii) third, to the payment of any other amounts required by
applicable law; and
(iv) fourth, to the Shareholder to the extent of any surplus
proceeds.
(c) the Banks shall give the Shareholder at least ten (10) days notice of
the time and place of any private sale, which notice the Shareholder hereby
<PAGE>
-4-
deems reasonable notice under applicable law. The Banks may enforce its rights
hereunder without any other notice and without compliance with any other
condition precedent now or hereafter imposed by statute, rule of law or
otherwise (all of which are hereby expressly waived by the Shareholder, to the
fullest extent permitted by law).
(d) The Banks shall not be obligated to make any sale of the Mortgaged
Shares if it shall determine not to do so, regardless of the fact that notice of
sale of the Mortgaged Shares shall have been given. The Banks may, without
notice or publication, adjourn any private sale or cause the same to be
adjourned from time to time by announcement at the time and place fixed for the
sale, and such sale may be made at the time and place to which the same was
adjourned. The Shareholder acknowledges that any private sale shall be deemed
to have been made in a commercially reasonable manner.
4. REPRESENTATIONS AND WARRANTIES OF THE SHAREHOLDER. The Shareholder
represents and warrants that:
(a) the Shareholder has the full power, legal right and capacity to enter
into this Agreement, to pledge its interest in the Mortgaged Shares for the
purposes described in the recitals to this Agreement and to carry out the
transactions contemplated by this Agreement; and
(b) the Shareholder is the legal and beneficial owner of all the Mortgaged
Shares with good and valid title thereto.
5. COVENANTS OF THE SHAREHOLDER. The Shareholder hereby covenants that,
until all of the Banks deliver to the Shareholder a written release of its
obligations hereunder, (a) it will not sell, convey or otherwise dispose of any
of the Mortgaged Shares or any interest therein or create, incur or permit to
exist any pledge, mortgage, lien, charge, encumbrance or any security interest
whatsoever in or with respect to any of the Mortgaged Shares or the income
therefrom, increases thereof or proceeds thereof, other than that created hereby
and (b) it will not change its Registered Office located at Craigmuir Chambers,
P.O. Box 71, Road Town, Tortola, British Virgin Islands without prior written
notice to the Banks.
6. TERMINATION. Upon satisfaction in full of all of the Obligations,
this Agreement shall terminate and the Banks shall deliver to the Shareholder
upon request, a written release of the Shareholder's obligations hereunder
together with the certificates representing or evidencing such of the Mortgaged
Shares as shall not have been sold or otherwise applied pursuant to this
Agreement.
<PAGE>
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7. MISCELLANEOUS. (a) NO WAIVER. No course of dealing between the
Shareholder or the Banks, nor any failure to exercise, nor any delay in
exercising, any right, power or privilege of the Banks hereunder, shall operate
as a waiver thereof; nor shall any single or partial exercise by the Banks of
any right, power or privilege hereunder preclude any other or further exercise
thereof or the exercise of any other right, power or privilege.
(b) REMEDIES CUMULATIVE. The rights and remedies provided herein are
cumulative and are in addition to and not exclusive of any rights or remedies
provided by law.
(c) SEVERABILITY. The provisions of this Agreement are severable, and if
any clause or provision shall be held invalid or unenforceable in whole or in
part in any jurisdiction then such invalidity or unenforceability shall affect
only such clause or provision or part thereof in such jurisdiction and shall not
in any manner affect such clause or provision in any other jurisdiction or any
other clause or provision in this Agreement in any jurisdiction.
(d) NOTICES. Each report, notice and other communication to be given
under this Agreement shall be in writing in the English language, be delivered
by hand, overnight or expedited delivery service, telecopier (with confirmation
by overnight or expedited delivery service) or telegram and be deemed to have
been duly given when received by the addressee as follows:
FOR THE SHAREHOLDER:
Sierra Rutile Holdings Limited
c/o SIERRA RUTILE LIMITED
c/o RGC (USA) Mineral Sands
1223 Warner Road
Green Cove Springs, Florida 32043-4623
Attention: Mr. Maxwell E. McGarvie
Acting Chief Executive
Fax: 904-284-4006
<PAGE>
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FOR CDC:
COMMONWEALTH DEVELOPMENT CORPORATION
One Bessborough Gardens
London SW1V 2JQ
United Kingdom
Attention: Regional Director, WACLA
Fax: 011-44 171 828 6505
FOR DEG:
DEG-DEUTSCHE INVESTITIONS- UND
ENTWICKLUNGSGESELLSCHAFT
Belvederstrasse 40
D-50933 Koln 41 (Mungersdorf)
Federal Republic of Germany
Attention: Mr. Roger Peltzer
Fax: 011-49-221 4986-105/6
FOR EXIM BANK
EXPORT-IMPORT BANK OF THE UNITED STATES
811 Vermont Avenue, N.W.
Washington, D.C. 20571
United States of America
Attention: Mr. Clement K. Miller
Fax: 202-565-3625
FOR IFC:
INTERNATIONAL FINANCE CORPORATION
2121 Pennsylvania Avenue, N.W.
Washington, D.C. 20433
United States of America
Attention: Director, Oil Gas and Mining Department
Fax: 202-974-4322
<PAGE>
-7-
FOR OPIC:
OVERSEAS PRIVATE INVESTMENT CORPORATION
1100 New York Avenue, N.W.
Washington, DC 20527
United States of America
Attention: Vice President, Finance
Re: Sierra Rutile
Fax: 202-408-9866
(e) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit of
and shall be binding upon the heirs, executors, administrators and personal
representatives, or the representatives, successors and assigns, as the case may
be, of the parties hereto.
(f) GOVERNING LAW. This Agreement shall be construed in accordance with
and governed by the laws of Sierra Leone.
(g) HEADINGS. The descriptive section headings have been inserted for
convenience of reference only and do not define or limit the provisions hereof.
IN WITNESS WHEREOF, the Shareholder has duly executed this Agreement as of
the date and year first above written.
SHAREHOLDER:
SIERRA RUTILE HOLDINGS LIMITED
By: /s/ [ILLEGIBLE]
--------------------------
Title: Acting Chief Executive
<PAGE>
-8-
Accepted:
COMMONWEALTH DEVELOPMENT CORPORATION
By: /s/ [ILLEGIBLE]
-------------------------------
Title: Investment Manager
DEG-DEUTSCHE INVESTIGATIONS-UND
ENTWICKLUNGSGESELLSCHAFT MBH
By: /s/ [ILLEGIBLE]
-------------------------------
Title: [ILLEGIBLE]
EXPORT-IMPORT BANK OF THE UNITED STATES
By: /s/ Clement K. Miller
-------------------------------
Title: Clement K. Miller, Acting
Vice President, Asset
Management Division
INTERNATIONAL FINANCE CORPORATION
By: /s/ [ILLEGIBLE]
-------------------------------
Title:
OVERSEAS PRIVATE INVESTMENT CORPORATION
By: /s/ John R. Aldonar
-------------------------------
Title: Senior Investment Officer
<PAGE>
SCHEDULE 1
MORTGAGED SHARES
38,685,017 shares of Sierra Rutile Limited
<PAGE>
COLLATERAL AGENT AGREEMENT
This Collateral Agent Agreement ("Collateral Agent Agreement") dated
as of May 15, 1998 by and among COMMONWEALTH DEVELOPMENT CORPORATION ("CDC"),
DEG-DEUTSCHE INVESTITIONS UND ENTWICKLUNGSGESELLSCHAFT MBH ("DEG"),
EXPORT-IMPORT BANK OF THE UNITED STATES ("Ex-Im"), INTERNATIONAL FINANCE
CORPORATION ("IFC") and OVERSEAS PRIVATE INVESTMENT CORPORATION ("OPIC";
collectively "Development Banks"), and SIERRA RUTILE HOLDINGS LIMITED
("Holdings") and CHASE MANHATTAN BANK ("Collateral Agent").
WHEREAS, Holdings owns 38,685,017 ordinary shares ("Shares") of Sierra
Rutile Limited ("SRL"), representing 100% of the issued and outstanding shares
of SRL; and
WHEREAS, the Development Banks have made certain loans to SRL pursuant
to various loan agreements, as amended ("Loan Agreements"); and
WHEREAS, Holdings has executed a Stock Pledge Agreement ("Pledge
Agreement"), pledging the SRL Shares to the Development Banks; and
WHEREAS, the Development Banks and Holdings have agreed that
Collateral Agent shall act as the collateral agent pursuant to the Pledge
Agreement; and
NOW, THEREFORE, it is hereby agreed as follows:
1. DESIGNATION OF COLLATERAL AGENT. Development Banks hereby
designate and appoint Collateral Agent as Collateral Agent to serve in
accordance with the terms of this Collateral Agent Agreement. The Collateral
Agent hereby accepts such appointment and agrees to act as Collateral Agent
pursuant to the terms and conditions of this Collateral Agent Agreement.
2. ACKNOWLEDGEMENT OF RECEIPT. The Collateral Agent hereby
acknowledges receipt of the certificates representing the Shares, copies of
which are annexed hereto as Exhibit A together with stock Transfer thereof
("Transfer") executed in blank, copies of which are annexed hereto as Exhibit B,
and agrees to hold and dispose of the Shares and Transfer in accordance with the
terms and conditions of this Collateral Agent Agreement and the Pledge
Agreement.
3. DISPOSITION OF SHARES AND TRANSFER. In the event that
Collateral Agent receives any notice jointly from the Development Banks
requesting that the Shares and Transfer be delivered either (a) to the
Development Banks or any of them or their designees or (b) to Holdings,
Collateral Agent shall promptly thereafter deliver the Shares in accordance with
such notice, provided, however, that if such notice requests delivery pursuant
to subdivision (a) above, the Collateral Agent shall give to Holdings five (5)
business days prior written notice thereof before
<PAGE>
making such delivery, unless the Banks, in their notice notify the Collateral
Agent that (i) they would be harmed by waiting such period or (ii) such notice
has been waived by Holdings.
4. LIABILITY; INDEMNIFICATION. (a) The parties hereto agree that
the duties of the Collateral Agent hereunder are purely ministerial in nature
and that the Collateral Agent shall incur no liability hereunder or otherwise
(except in the event of a final adjudication of willful misconduct or gross
negligence) for any action taken by it hereunder or for any failure or refusal
to act pursuant to any notice, direction or instructions which it may receive
from any party hereto or for any other matter. The Collateral Agent shall be
under no responsibility with respect to the Shares and Transfer other than
faithfully to follow the instructions herein contained. The Collateral Agent
shall have no responsibility to determine the authenticity or validity of any
notice, direction, instruction, document or other item delivered to it, and it
shall be fully relieved of any liability in acting in accordance with any
written notice, direction or instruction given to it under this Collateral Agent
Agreement and believed by it, in its subjective judgment, to be authentic.
(b) Unless the Collateral Agent shall have been finally adjudicated
guilty of willful misconduct or gross negligence, Holdings agrees to indemnify
and hold harmless the Collateral Agent from and against any liability incurred
by it hereunder including reasonable attorneys fees and expenses (which
obligation shall survive the closing of the Collateral Agent Agreement). The
Collateral Agent shall not be required to defend any legal proceedings which may
be instituted against it with respect to the subject matter of this Collateral
Agent Agreement unless requested to do so by the Development Banks or Holdings
and indemnified to its satisfaction against the cost and expenses of such
defense.
(c) Anything in this Collateral Agent Agreement to the contrary
notwithstanding, in no event shall the Collateral Agent be liable for special,
indirect or consequential loss or damage of any kind whatsoever (including but
not limited to lost profits), even if the Collateral Agent has been advised of
the likelihood of such loss or damage and regardless of the form of action.
5. COMPENSATION OF COLLATERAL AGENT. All compensation to Collateral
Agent shall be paid by Holdings to Collateral Agent in accordance with the terms
set forth on Schedule 1 annexed hereto, and Holdings and Collateral Agent agree
that the Development Banks shall not have any liability therefor.
6. TERMINATION OF AGREEMENT. This Collateral Agent Agreement shall
terminate and the Collateral Agent shall be fully released and discharged from
all obligation and liability hereunder, upon the delivery of the Shares and
Transfer as provided herein.
7. NOTICES. All notices, requests and other communications under
this Collateral Agent Agreement shall be in writing and shall be personally
delivered, sent by first class registered or certified mail, postage prepaid,
return receipt requested, or sent by United States Express Mail or overnight
courier service, addressed as follows:
-2-
<PAGE>
To Holdings: Sierra Rutile Holdings Limited
c/o Sierra Rutile Limited
c/o RGC (USA) Mineral Sands
1223 Warner Road
Green Cove Springs, Florida 32043-4623
Attention: Mr. Maxwell E. McGarvie
Acting Chief Executive
Facsimile: (904) 284-4006
To CDC: Commonwealth Development Corporation
One Bessborough Gardens
London SW1 V2JQ England
Telex: 21431/25849
Facsimile: 011-44-171 828-6505
To DEG: DEG-Deutsche Investitions-und
Entwicklungsgesellschaft mbH
Belvederstrasse 40
D-50933 Cologne 41 (Mungersdorf) Germany
Attention: Mr. Roger Peltzer
Telex: 8 881 949 DEG D
Facsimile: 011-49 221 4986-105/6
To Ex-Im: Export-Import Bank of the United States
811 Vermont Avenue, N.W.
Washington, D.C. 20571
United States of America
Attention: Mr. Clement K. Miller
Telex: 197681 EXIM UT
Facsimile: (202) 565-3625
To IFC International Finance Corporation
2121 Pennsylvania Avenue, N.W.
Washington, D.C. 20433
United States of America
Attention: Director, Department of Investment,
Oil, Gas & Mining
Facsimile: (202) 974-4322
with a copy (in the case of notices relating to
payments) sent to the attention of the Manager,
Accounting Division, at:
Facsimile: (202) 676-1830
-3-
<PAGE>
To OPIC: Overseas Private Investment Corporation
1100 New York Avenue, N.W.
Washington, D.C. 20527
United States of America
Attention: Vice President, Finance
Re: Sierra Rutile
Facsimile: (202) 408-9866
To Collateral Agent: Chase Manhattan Bank
450 West 33rd Street
New York, New York 10001
Attention: Escrow Administration, 15th Floor
Facsimile: (212) 946-8156
or at such other address, and to the attention of such person, of which any
party hereof shall have given notice as herein provided.
Notices shall be deemed received on the date of delivery if personally
delivered, three (3) days after mailing if mailed in accordance with the
provisions hereof or on the next business day if sent by United States Express
Mail or overnight courier service.
8. SUCCESSOR COLLATERAL AGENTS. The Collateral Agent, or any
successor to it hereafter appointed, may at any time resign by giving notice in
writing to the parties hereto and shall be discharged from its duties upon the
appointment of a successor Collateral Agent as hereinafter provided, or upon the
expiration of sixty (60) days after such notice is given. In the event of any
such resignation, a successor Collateral Agent, which shall be a bank or trust
company established under the laws of the United States of America or any state
thereof having combined capital, surplus and undivided profits of not less than
$100,000,000 and having trust powers shall be appointed by the Banks with the
written consent of Holdings. Any successor Collateral Agent shall deliver to
the other parties hereto and the Collateral Agent a written instrument accepting
the appointment hereunder, and thereupon it shall succeed to all the rights and
duties of the Collateral Agent hereunder and shall be entitled to receive the
Shares and Transfer then held by the predecessor Collateral Agent hereunder. In
the event that the parties hereto do not appoint a successor Collateral Agent
within sixty (60) days, Collateral Agent shall deposit the Shares and Transfer
into a court of competent jurisdiction and, from and after the date such deposit
is made, the Collateral Agent shall be released and discharged of all
obligations with respect thereto.
9. MISCELLANEOUS.
(a) This Collateral Agent Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
(b) Neither this Collateral Agent Agreement nor any of the provisions
hereof may be waived, modified, amended, discharged or terminated except by an
instrument in writing signed by all parties hereto, and then only to the extent
set forth in such instrument.
-4-
<PAGE>
(c) This Collateral Agent Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, and all of which shall
constitute a single instrument. Facsimile copies hereof shall be deemed to be
originals for all purposes hereunder.
(d) This Collateral Agent Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors,
assigns and personal representatives.
(e) The descriptive headings of the several Sections of this
Collateral Agent Agreement are inserted for convenience only, do not constitute
a part of this Collateral Agent Agreement and shall not affect in any way the
meaning or interpretation of this Collateral Agent Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first set forth above.
SIERRA RUTILE HOLDINGS LIMITED
By: /s/ [ILLEGIBLE]
-------------------------------
Authorized Representative
Name: [ILLEGIBLE]
Title: Acting Chief Executive
COMMONWEALTH DEVELOPMENT
CORPORATION
By: /s/ [ILLEGIBLE]
-------------------------------
Authorized Representative
Name: [ILLEGIBLE]
Title: Investment Manager
DEG-DEUTSCHE INVESTITIONS-UND
ENTWICKLUNGSGESELLSCHAFT mbH
By: /s/ [ILLEGIBLE]
-------------------------------
Authorized Representative
Name: [ILLEGIBLE]
Title:
-5-
<PAGE>
EXPORT-IMPORT BANK OF THE UNITED STATES
By: /s/ Clement K. Miller
-------------------------------
Authorized Representative
Name: Clement K. Miller
Title: Acting Vice President
Asset Management Division
INTERNATIONAL FINANCE CORPORATION
By: /s/ [ILLEGIBLE]
-------------------------------
Authorized Representative
Name:
Title:
OVERSEAS PRIVATE INVESTMENT CORPORATION
By: /s/ John R. Aldonas
-------------------------------
Authorized Representative
Name: John R. Aldonas
Title: Senior Investment Officer
CHASE MANHATTAN BANK
By: /s/ [ILLEGIBLE]
-------------------------------
Authorized Representative
Name: [ILLEGIBLE]
Title: Assistant Vice President
-6-
