VOTING LIMITATION AGREEMENT
Exhibit 10.1
This VOTING LIMITATION AGREEMENT (this “Agreement”) dated as of March 28, 2007, is
entered into by and between Battle Mountain Gold Exploration Corp., a Nevada corporation (the
“Company”) and Royal Gold, Inc., a Delaware corporation (“Acquiror”).
RECITALS:
WHEREAS, the Company and Acquiror desire to enter into an agreement for the Acquiror to
acquire the Company (the “Acquisition Agreement”);
WHEREAS, Acquiror has previously entered into Option and Support Agreements, dated as of March
5, 2007, with each of Xxxx X. Xxxxxx (“Xxxxxx”) and IAMGOLD Corporation (collectively with
Xxxxxx, the “Shareholders”), pursuant to which the Shareholders have agreed, among other
matters, to approve the Acquisition Agreement and the transactions contemplated thereby; and
WHEREAS, the Company, BMGX (Barbados) Corporation (collectively with the Company, the
“Borrowers”) and Acquiror have entered into that certain Bridge Finance Facility Agreement
(the “Bridge Loan”), dated as of the date hereof, pursuant to which Acquiror has agreed to
loan up to $20,000,000 aggregate principal amount to the Borrowers, which amount, collectively with
all accrued but unpaid interest thereon, all interest on accrued and unpaid interest, all accrued
and unpaid fees, expenses, costs, indemnities and other amounts payable to the Acquiror under the
Bridge Loan, may be converted, at the option of the Acquiror, at any time during the term of the
Bridge Loan, into shares of Company Common Stock at a conversion price equal to $.60 per share.
NOW, THEREFORE, the parties hereto agree as follows:
AGREEMENT
1. Certain Definitions. For purposes of this Agreement:
(a) “Acquisition Proposal” means any proposal, offer or inquiry relating to (or any
third party indication of interest in), whether in one transaction or a series of related
transactions, (i) any sale or other disposition, directly or indirectly, by merger, consolidation,
share exchange or any similar transaction, of the business or assets of the Company representing
10% or more of the consolidated assets of the Company and its subsidiaries, (ii) any issuance, sale
or other disposition by the Company (including by way of merger, consolidation, share exchange or
any similar transaction) of securities (or options, rights or warrants to purchase, or securities
convertible into, such securities) representing 20% or more of the votes associated with the
outstanding voting equity securities of the Company or any of its subsidiaries whose assets,
individually or in the aggregate, constitute more than 20% of the consolidated assets of the
Company, (iii) any tender offer or exchange offer in which any person or “group” (as such term is
defined under the Exchange Act) would acquire Beneficial Ownership, or the right to acquire
Beneficial Ownership, of 20% or more of the outstanding shares of the Company or any of its
subsidiaries whose assets, individually or in the aggregate, constitute more than 20% of the
consolidated assets of the Company, (iv) any recapitalization, restructuring, liquidation,
dissolution or other similar type of transaction with respect to the Company or any of its
subsidiaries whose assets, individually or in the aggregate, constitute more than 20% of the
consolidated assets of the Company or (v) any transaction which is similar in form, substance or
purpose to any of the foregoing transactions; provided, however, that the term
“Acquisition Proposal” shall not include any of the transactions contemplated by the Acquisition
Agreement.
(b) “Affiliate” shall mean, with respect to any specified person, any person that
directly, or indirectly through one or more intermediaries, controls, is controlled by or is under
common control with the person specified. The term “Affiliated” shall have a correlative meaning.
(c) “Beneficially Own” or “Beneficial Ownership” with respect to any
securities means having “beneficial ownership” of such securities (as determined pursuant to Rule
13d-3 under the Exchange Act).
(d) “Company Common Share” means a share of common stock, par value $.001 per share,
of the Company, including for purposes of this Agreement, all shares or other voting securities
into which a Company Common Share may be reclassified, sub-divided, consolidated or converted and
any rights and benefits arising therefrom (including any dividends or distributions of securities
which may be declared in respect of Company Common Shares).
(e) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.
(f) “Governmental Body” means any government or governmental or regulatory body
thereof, or political subdivision thereof, whether foreign, federal, state, or local, or any
agency, instrumentality or authority thereof, or any court or arbitrator (public or private).
(i) “Limitation Period” shall mean the period (A) commencing upon the termination of
the Acquisition Agreement by the Company if, at any time prior to receiving the Requisite
Shareholder Approval, the board of directors of the Company authorizes the Company, subject to
complying with the terms of the Acquisition Agreement, to terminate the Acquisition Agreement in
order to enter into a binding, definitive agreement with respect to a Superior Proposal;
provided that the Company shall have first paid to Acquiror any termination, break-up or
similar fees payable pursuant to the Acquisition Agreement; and provided, further,
that (i) the board of directors after consultation with its outside legal counsel and financial
advisors, concludes in good faith that an Acquisition Proposal constitutes a Superior Proposal (and
after giving effect to any proposed modifications to the Acquisition Agreement or the transactions
contemplated thereby), (ii) the Company has notified Acquiror by written notice, at least four
business days in advance, of its board of director’s intention to not make, withdraw, modify or
qualify a recommendation (a “Change in Recommendation”) to the shareholders of the Company
in favor of the Acquisition Agreement and the transactions contemplated thereby, specifying the
material terms and conditions of such Superior Proposal and the identity of the party making such
Superior Proposal, and furnishing to Acquiror a copy of any relevant proposed transaction
agreements with the party making such Superior Proposal and any other material documents received
by it or its representatives, and (iii) prior to effecting such a Change in
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Recommendation, the board of directors of the Company has, and has caused its financial and
legal advisors to, negotiate with Acquiror in good faith to make such adjustments in the terms and
conditions of the Acquisition Agreement such that such Acquisition Proposal would no longer
constitute a Superior Proposal, and (B) ending upon the earlier of (i) the consummation or
termination of a transaction underlying a Superior Proposal, (ii) the Company’s acceptance of any
proposed modifications to the Acquisition Agreement or the transactions contemplated thereby such
that an Acquisition Proposal previously considered to be a Superior Proposal no longer constitutes
a Superior Proposal, or (iii) the receipt by the Company of the Requisite Shareholder Approval.
(g) “Requisite Shareholder Approval” means the affirmative consent or vote of the
holders of the outstanding shares of Company Common Stock required by law to approve the
Acquisition Agreement and the transactions contemplated thereby.
(h) “Share Limit” means 39.9% of the total number of shares of Company Common Stock
entitled to vote in respect of a matter.
(i) “Superior Proposal” means a bona fide written and publicly announced Acquisition
Proposal that (i) the board of directors of the Company concludes in good faith, after consultation
with its financial advisors and legal advisors, taking into account all legal, financial,
regulatory, timing, certainty and other aspects of the proposal and the person making the proposal
(including any break-up fees, expense reimbursement provisions and conditions to consummation) is
more favorable to the shareholders of the Company of the from a financial point of view, than the
transactions contemplated by the Acquisition Agreement (after giving effect to any adjustments to
the terms and provisions of the Acquisition Agreement proposed by Acquiror in response to such
Acquisition Proposal), (ii) if any cash consideration is payable as part of the Superior Proposal,
that such cash consideration shall be fully financed or reasonably capable of being fully financed
promptly, (iii) if any consideration as part of the Superior Proposal is payable in shares of
capital stock listed on a national securities exchange or quoted on an inter-dealer quotation
system, then the value of such consideration shall be determined in relation to the value of the
shares of Company Common Stock to be issued in connection with the transactions contemplated by the
Acquisition Agreement, and (iv) is reasonably likely to receive all required approvals of any
Governmental Body and other person on a timely basis and otherwise reasonably capable of being
completed on the terms proposed.
2. Voting Restrictions. The Acquiror agrees that if the Acquisition Agreement is
executed by the parties thereto, during the Limitation Period, the Acquiror shall not vote any
Company Common Shares in excess of the Share Limit in favor of the Acquisition Agreement or the
transactions contemplated thereby, or against any action, agreement, transaction or proposal that
is made in opposition to, or is in competition or inconsistent with, the Acquisition Agreement or
the transactions contemplated thereby, relates to an alternative Acquisition Transaction (as
defined in the Letter Agreement between Acquiror and the Company, dated February 28, 2007) or could
otherwise prevent, impede or delay the consummation of the Acquisition Agreement or the
transactions contemplated thereby; provided that Acquiror may vote in excess of the Share
Limit any remaining shares of Company Common Stock in a manner proportionate to the manner in which
all holders of shares of Company Common Stock (other than the Shareholders or the Acquiror) vote in
respect of a matter.
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3. Waiver; Amendment. Any provision of this Agreement may be amended or waived, but only if
the amendment or waiver is in writing and signed by the parties hereto.
4. Counterparts. This Agreement may be executed in any number of counterparts, each of
which will constitute an original and all of which, when taken together, will constitute one
agreement. Any signature pages of this Agreement transmitted by telecopier will have the same
legal effect as an original executed signature page.
[Signature Page Follows]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed on their
behalf as of the day and year first above written.
| COMPANY: BATTLE MOUNTAIN GOLD EXPLORATION CORP. |
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| By: | /s/ Xxxxx Xxxxxxxx | |||
| Name: | Xxxxx Xxxxxxxx | |||
| Title: | Chief Financial Officer | |||
| ACQUIROR: ROYAL GOLD, INC. |
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| By: | /s/ Xxxx Xxxxxx | |||
| Name: | Xxxx Xxxxxx | |||
| Title: | President and Chief Executive Officer | |||
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