CONTRIBUTION AGREEMENT dated as of February 26, 2008 among GENERAL MOLY, INC., NEVADA MOLY, LLC, EUREKA MOLY, LLC and POS-MINERALS CORPORATION
Exhibit
10.20
Execution
Version
dated
as of February 26, 2008
among
NEVADA
MOLY, LLC,
EUREKA
MOLY, LLC
and
POS-MINERALS
CORPORATION
CONTRIBUTION
AGREEMENT; SOLO COVER PAGE
TABLE
OF CONTENTS
Page
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ARTICLE
I DEFINITIONS; INTERPRETATION
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2
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1.1
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Definitions
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2
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1.2
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Interpretation
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9
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ARTICLE
II CONTRIBUTIONS; CLOSING
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10
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2.1
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General
Moly Contributions of Assets
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10
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2.2
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General
Moly Contribution of LLC Interest
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11
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2.3
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POS-Minerals
Contribution
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12
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2.4
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Pre-Closing
Date Expenditures.
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12
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2.5
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Closing
|
14
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2.6
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Closing
Deliveries.
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14
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ARTICLE
III REPRESENTATIONS AND WARRANTIES
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17
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3.1
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Representations
and Warranties of the GMO Parties
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17
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3.2
|
Representations
and Warranties of POS-Minerals
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25
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ARTICLE
IV COVENANTS
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27
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4.1
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Confidentiality
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27
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4.2
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Expenses;
Transfer Taxes.
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28
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4.3
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Press
Releases and Public Announcements
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28
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4.4
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Further
Assurances
|
28
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|
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ARTICLE
V INDEMNIFICATION
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28
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5.1
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Survival
of Representations and Warranties
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28
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5.2
|
Indemnification
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29
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5.3
|
Procedures.
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31
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5.4
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Insurance
Proceeds
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32
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5.5
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Obligations
of General Moly and Nevada Moly
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33
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ARTICLE
VI MISCELLANEOUS
|
33
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6.1
|
Entire
Agreement; Successors and Assigns
|
33
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6.2
|
Governing
Law; Language
|
33
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|
6.3
|
Resolution
of Disputes
|
33
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6.4
|
Headings
|
34
|
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6.5
|
Notices
|
34
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6.6
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Severability
|
36
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6.7
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Waiver
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36
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6.8
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Assignment
and Binding Effect
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36
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6.9
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No
Benefit to Others
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36
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6.10
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Counterparts
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36
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6.11
|
Rules
of Construction
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37
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6.12
|
No
Partnership
|
37
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6.13
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No
Sovereign Immunity.
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37
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6.14
|
Legal
Relationships.
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37
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TABLE
OF SCHEDULES AND EXHIBITS
EXHIBITS
Exhibit
A
|
Form
of LLC Agreement
|
Exhibit
B
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Form
of Assignment of LLC Interest
|
Exhibit
C
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Form
of POSCAN Guaranty
|
Exhibit
D
|
Form
of Opinion of Xxxxxxxxx Law Corporation
|
Exhibit
E
|
Executed
Conveyance Documents
|
Exhibit
E-1
|
Mineral
Deed
|
Exhibit
E-2
|
Xxxx
of Sale and Assignment
|
Exhibit
E-3
|
Assignment
of Project Lease
|
Exhibit
E-4
|
Assignment
of Office Lease
|
Exhibit
E-5
|
Deed
of Real Property
|
Exhibit
E-6
|
KVR
Water Lease
|
Exhibit
E-7
|
Assumption
Agreement
|
Exhibit
F
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Example
Calculation of Pre-Closing Date Payment Amount
|
Exhibit
G
|
Volume
I of Bankable Feasibility Study
|
SCHEDULES
Schedule
I
|
Contributed
Assets
|
Schedule
I-1
|
Mineral
Properties
|
Schedule
I-2
|
Water
Rights
|
Schedule
I-3
|
Material
Contracts
|
Schedule
I-4
|
Leased
Real Property
|
Schedule
I-5
|
Owned
Real Property
|
Schedule
I-6
|
Vehicles
and Equipment
|
Schedule
I-7
|
Permits,
Permit Applications and Bonds
|
Schedule
I-8
|
Other
Assets
|
Schedule
II
|
Assumed
Liabilities
|
Schedule
2.1(b)
|
Pending
Approvals
|
Schedule
2.3(a)(i)
|
Wire
Transfer Instructions
|
Schedule
2.4
|
Underfunded
2007 Payment Amount Schedule
|
Schedule
3.1(e)
|
Obtained
Authorizations and Government Approvals
|
Schedule
3.1(j)(i)
|
Compliance
with Laws
|
Schedule
3.1(j)(vi)
|
Conflicting
Claims
|
Schedule
3.1(j)(viii)
|
Environmental
Matters
|
Schedule
3.1(j)(x)
|
Insurance
Policies
|
This
Contribution Agreement is dated as of February 26, 2008, by and
among:
GENERAL
MOLY, INC.,
a
Delaware corporation and successor-by-merger to Idaho General Mines, Inc.
(“General
Moly”);
NEVADA
MOLY, LLC,
a
Delaware limited liability company (“Nevada
Moly”,
and
together with General Moly, individually referred to as a “GMO
Party”,
and
collectively as the “GMO
Parties”);
EUREKA
MOLY, LLC,
a
Delaware limited liability company (the “Company”);
and
POS-MINERALS
CORPORATION,
a
Delaware corporation (“POS-Minerals”).
The
GMO
Parties, the Company and POS-Minerals are sometimes referred to herein
individually as a “Party”
and
collectively as the “Parties.”
Capitalized terms used and not otherwise defined in this Agreement have the
respective meanings ascribed thereto in Article
I.
RECITALS
A. General
Moly owns (i) 100% of the issued and outstanding limited liability company
membership interests of the Company and (ii) 100% of the issued and outstanding
limited liability company membership interests of Nevada Moly. General Moly,
pursuant to the Conveyance Documents, has contributed the Contributed Assets
to
the Company, in exchange for the issuance to General Moly of its 100% interest
in the Company and the assumption by the Company of the Assumed Liabilities.
B. POS-Minerals
desires to make the POS-Minerals Initial Contribution to the Company as
described in Article IV of the LLC Agreement, in exchange for the issuance
to
POS-Minerals of the limited liability company membership interest to be issued
to POS-Minerals pursuant to the LLC Agreement (the “Eureka
POS LLC Interest”).
C. General
Moly desires to contribute its entire limited liability company membership
interest in the Company to Nevada Moly, such that immediately after such
contribution and the issuance to POS-Minerals of the Eureka POS LLC Interest,
Nevada Moly will own the limited liability company membership interest described
as being owned by Nevada Moly pursuant to the LLC Agreement (the “Eureka
GMO LLC Interest”).
AGREEMENT
In
consideration of the mutual promises, covenants and agreements set forth herein
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Parties agree as follows:
ARTICLE
I
DEFINITIONS;
INTERPRETATION
1.1 Definitions.
For
purposes of this Agreement, the following terms have the following
meanings:
“Accounting
Procedure”
means
the “Accounting Procedure” as such term is defined in the LLC
Agreement.
“Act”
means
the “Act” as such term is defined in the LLC Agreement.
“Affiliate”
means
with respect to a Person, any other Person that directly, or indirectly through
one or more intermediaries, controls, or is controlled by, or is under common
control with, such Person. As used in this definition, the word “control” means
the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through ownership
of voting securities, by contract or otherwise. Notwithstanding the foregoing,
for purposes of this Agreement, the Company shall not be considered an Affiliate
of any of the GMO Parties or POS-Minerals or any of their respective
Affiliates.
“Agreement”
means
this Contribution Agreement and all Exhibits and Schedules hereto, which are
hereby incorporated herein by this reference.
“Applications
to Change”
has
the
meaning set forth in the KVR Water Lease.
“Assignment
of LLC Interest”
means
the Contribution and Assignment of Limited Liability Company Interest, from
General Moly to the Company, to be executed and delivered at the Closing,
substantially in the form of Exhibit B.
“Authorizations”
means
resolutions, approvals or consents of third parties, creditors, shareholders,
partners and members, excluding any Government Approvals.
“Business
Account”
means
the “Business Account” as such term is defined in the LLC
Agreement.
“Business
Day”
means
any day other than Saturday, Sunday, and a day on which banks in Denver,
Colorado, U.S. or Seoul, Republic of Korea are required or permitted by Law
to
close.
“Code”
means
the Internal Revenue Code of 1986. Any reference herein to a specific section
or
sections of the Code shall be deemed to include a reference to any corresponding
provision of future Law.
“Confidential
Information”
means
“Confidential Information” as such term is defined in the Confidentiality
Agreement.
“Confidentiality
Agreement”
means
the Mutual Nondisclosure Agreement, dated as of April 24, 2007, among POSCO,
a
Korean corporation, POSCAN and General Moly.
“Continuing
Obligations”
means
the “Continuing Obligations” as such term is defined in the LLC
Agreement.
“Contributed
Assets Value”
means
the “Contributed Assets Value” as such term is defined in the LLC
Agreement.
“Contribution
Date”
means
12:01 a.m., January 1, 2008.
“Dollars”
or
“$”
means
the lawful currency of the U.S.
“Encumbrance”
means
mortgages, deeds of trust, security interests, pledges, liens, net profits
interests, royalties or overriding royalty interests, other payments out of
production, or other burdens of any nature.
“Environmental
Laws”
means
Laws aimed at reclamation or restoration of the Properties; abatement of
pollution; protection of the environment; protection of wildlife, including
endangered species; ensuring public safety from environmental hazards;
protection of cultural or historic resources; management, storage or control
of
hazardous materials and substances; releases or threatened release of
pollutants, contaminants, chemicals or industrial, toxic or hazardous substances
as wastes into the environment, including ambient air, surface water and
groundwater; and all other laws relating to the manufacturing, processing,
distribution, use, treatment, storage, disposal, handling or transport of
pollutants, contaminants, chemicals or industrial, toxic or hazardous substances
or wastes.
“Environmental
Liabilities”
means
any and all claims, actions, causes of action, damages, losses, liabilities,
obligations, penalties, Judgments, amounts paid in settlement, assessments,
costs, disbursements or expenses (including attorneys’ fees and costs, experts’
fees and costs, and consultants’ fees and costs) of any kind or of any nature
whatsoever that are asserted against the Company, by any Person other than
Nevada Moly or POS-Minerals, alleging liability (including liability for
studies, testing or investigatory costs, cleanup costs, response costs, removal
costs, remediation costs, containment costs, restoration costs, corrective
action costs, closure costs, reclamation costs, natural resource damages,
property damages, business losses, personal injuries, penalties or fines)
arising out of, based on or resulting from (a) the presence, release,
threatened release, discharge or emission into the environment of any hazardous
materials or substances existing or arising on, beneath or above the Contributed
Assets and/or emanating or migrating and/or threatening to emanate or migrate
from the Contributed Assets to off-site properties; (b) physical
disturbance of the environment; or (c) the violation or alleged violation of
any
Environmental Laws.
“GAAP”
means
generally accepted accounting principles as used in the U.S.
“Governing
Documents”
means
the articles or certificate of incorporation or formation, organization or
association, general or limited partnership agreement, limited liability company
or operating agreement, bylaws or other incorporation or governing documents
of
any Person.
“Government
Approval”
means
any authorization, consent, approval, ruling, tariff, rate, certification,
exemption, registration, declaration, application, or filing, variance, claim,
Judgment, decree, sanction, or publication of, by or with, any notice to, any
declaration of or with, or any registration by or with, or any other action
or
deemed action by or on behalf of, any Governmental Authority.
“Governmental
Authority”
means
any domestic or foreign national, regional or local, court, governmental
department, commission, authority, central bank, board, bureau, agency, official
or other instrumentality exercising executive, legislative, judicial, taxing,
regulatory or administrative powers or functions of or pertaining to
government.
“Governmental
Fees”
means
all location fees, mining claim rental fees, mining claim maintenance payments
and similar payments required by Law to locate and hold unpatented mining
claims.
“Hedge
Instrument”
means
(a) any currency swap agreement, option contract, future contract, option on
futures contract, spot or forward contract or other agreements to purchase
or
sell currency or any other arrangement entered into by a Person to hedge such
Person’s exposure or to speculate on movements in rates of exchange of
currencies; (b) any interest rate swap, option contract, futures contract,
options on futures contract, cap, floor, collar or any other similar hedging
arrangements entered into by a Person to hedge such Person’s exposure to or to
speculate on movements in interest rates; (c) any forward purchase, forward
sale, put option, synthetic put option, call option, collar or any other
arrangement relating to commodities entered into by a Person to hedge such
Person’s exposure to or to speculate on commodity prices; and (d) any other
derivative transaction or hedging arrangement of any type or nature whatsoever
that is the subject at any time of trading in the over-the-counter derivatives
market.
“Idaho
General”
means
Idaho General Mines, Inc., which by corporate merger and name change effective
October 8, 2007 became General Moly.
“Indebtedness”
means,
without duplication, (a) all obligations created, issued or incurred for
borrowed money (whether by loan, the issuance and sale of debt securities,
or
the sale of property to another Person subject to an understanding or agreement,
contingent or otherwise, to repurchase such property from such other Person);
(b) all obligations to pay the deferred purchase price or acquisition price
of property or services (other than accrued expenses and trade accounts payable
incurred in the ordinary course of business), (c) all obligations to pay money
evidenced by a note, bond, debenture or similar instrument; (d) all
reimbursement obligations in respect of letters of credit or similar instruments
issued or accepted by banks and other financial institutions; (e) all payment
obligations under any Hedge Instrument to the extent constituting a liability
under GAAP; and (f) all obligations of another Person of the type listed in
clauses (a) through (e) of this definition, payment of which is guaranteed
by or
secured by Encumbrances on the property of such Person (with respect to
Encumbrances, to the extent of the value of property pledged pursuant to such
Encumbrances if less than the amount of such obligations).
“Indemnified
Party”
means
a
Party entitled to indemnification under Article
V.
CONTRIBUTION
AGREEMENT; Page 4
“Indemnifying
Party”
means
a
Party obligated to indemnify another Party under Article
V.
“Initial
Contribution”
means
“Initial Contribution” as such term is defined in the LLC
Agreement.
“Judgment”
means
any judgment, writ, order, decree, injunction, award, restraining order or
ruling of or by any court, judge, justice, arbitrator or magistrate, including
any bankruptcy court or judge, and any writ, order, decree or ruling of or
by
any Governmental Authority.
“Knowledge”
means
(a) with respect to any of the GMO Parties, the actual knowledge of Xxxxx
Xxxxxx, Xxxx Xxxxxx or Xxxxxx Xxxxxxx, and (b) with respect to POS-Minerals,
the
actual knowledge of Xxxxxx-Kyun Xxx or Xxxxx (S.H.) Ha. “Known”
or
“Know”
when
capitalized herein have a correlative meaning.
“Kobeh
Valley Ranch”
means
Kobeh Valley Ranch, LLC, a Nevada limited liability company of which General
Moly owns 100% of the issued and outstanding limited liability company
membership interests.
“Law”
means
all applicable foreign, domestic, national, federal, state and local laws
(statutory or common), rules, ordinances, regulations, grants, concessions,
franchises, licenses, orders, directives, judgments, decrees, proclamations,
instructions, requests and other governmental restrictions, including permits
and other similar requirements, whether legislative, municipal, administrative
or judicial in nature.
“Legal
Proceeding”
means
any private or governmental action, suit, complaint, arbitration, legal or
judicial or administrative proceeding or investigation, whether civil, criminal
or of any other nature.
“LLC
Agreement”
means
the Amended and Restated Limited Liability Company Agreement of the Company,
between Nevada Moly and POS-Minerals, to be executed and delivered at the
Closing, substantially in the form of Exhibit
A.
“Losses”
means
losses, liabilities, damages, dues, deficiencies, assessments, Liens, fines,
interest, penalties, including with respect to Taxes, costs, expenses and
obligations, including amounts reasonably paid in settlement, prosecuting,
defending or otherwise, and reasonable legal, accounting, experts and other
fees, costs and expenses, in connection with claims, actions, suits,
proceedings, hearings, investigations, charges, complaints, demands, injunctions
and Judgments.
“Manager”
means
the “Manager” as such term is defined in the LLC Agreement.
CONTRIBUTION
AGREEMENT; Page 5
“Material
Adverse Effect”
means
a
material adverse effect on (a) the Contributed Assets and the Assumed
Liabilities, taken as a whole, or (b) the ability of any of the GMO Parties
or
the Company to consummate the transactions provided for in this Agreement and
the other Transaction Documents or to perform their respective obligations
hereunder and thereunder; provided,
that
none of the following shall or will be deemed to constitute, and shall not
be
taken into account in determining the occurrence of, a Material Adverse Effect:
(i) the Transaction Documents or the announcement thereof, or any effect or
change that results from the taking of any action required or specifically
permitted pursuant to this Agreement or any other Transaction Documents;
(ii) any effect or change that results from any change in the economy of
the world, the U.S., Canada, the Republic of Korea or any region thereof, any
regulatory or political conditions, any change in currency exchange rates,
or
the mining, refining or manufacturing industries in general; (iii) any
effect or change that results from any unilateral action taken by POS-Minerals
or any of its Affiliates not provided for by this Agreement or the transactions
provided for herein; (iv) acts or war, insurrection, sabotage or terrorism;
or
(v) any effect or change in the financial, banking or securities markets
(including any suspension of trading in, or limitations on prices for,
securities on any national or regional securities exchange).
“Member”
means
a
“Member” as such term is defined in the LLC Agreement. As of immediately after
the Closing, the Members are Nevada Moly and POS-Minerals.
“Operations”
means
the activities to be carried out by the Company under the LLC
Agreement.
“Order”
means
any writ, Judgment, decree, injunction or similar order of any Governmental
Authority or any other Person (in each such case, whether preliminary or final)
applicable to the Operations or the Closing.
“Permitted
Encumbrances”
means,
with respect to any Person, the following: (a) Encumbrances for Taxes,
Governmental Fees, assessments or other governmental charges or levies not
yet
due and payable or that are being contested in good faith through appropriate
proceedings; (b) Encumbrances of carriers, warehousemen, mechanics, materialmen
and landlords incurred in the ordinary course of business for sums not yet
due
or that are being contested in good faith through appropriate proceedings;
(c) Encumbrances incurred in the ordinary course of business in connection
with workmen’s compensation, unemployment insurance or other forms of
governmental insurance or benefits, or to secure performance of tenders,
statutory obligations, legal privileges, leases, bank guarantees, letters of
credit and contracts, agreements, leases, purchase orders and other agreements
(other than for borrowed money) entered into in the ordinary course of business
or to secure obligations on surety or appeal bonds; (d) purchase money security
interests or Encumbrances on property acquired or held by such Person in the
ordinary course of business to secure the purchase price of such property or
to
secure Indebtedness incurred for the purpose of financing the acquisition of
such property; (e) easements, restrictions and other minor defects of title
that are not, in the aggregate, material or which do not, individually or in
the
aggregate, materially and adversely affect the value of the property affected
thereby or the use thereof for its intended purpose; (f) the Material
Contracts; (g) Encumbrances set forth on any of the Schedules; and (h) subject
to Section
2.1(d),
any
Pending Approvals.
“Person”
means
a
natural person, corporation, joint stock company, joint venture, partnership,
limited liability partnership, limited partnership, limited liability limited
partnership, limited liability company, trust, estate, business trust,
association, Governmental Authority or any other entity.
CONTRIBUTION
AGREEMENT; Page 6
“POSCAN”
means
POSCO Canada Ltd., a company limited by shares incorporated under the Laws
of
the province of British Columbia, Canada.
“POSCAN
Guaranty”
means
the Guarantee and Indemnity Agreement, by POSCAN in favor of the GMO Parties,
to
be executed and delivered at the Closing, substantially in the form of
Exhibit
C.
“POS-Minerals
Initial Contribution”
means
the “POS-Minerals Initial Contribution” as such term is defined in the LLC
Agreement.
“Project”
means
the molybdenum mine and process plant described in the Plan of
Operations.
“Schedules”
means
the schedules attached hereto. The Schedules have been arranged in sections
corresponding to the numbered sections of this Agreement. Any matter disclosed
by the GMO Parties in the Schedules pursuant to any Section of this Agreement
shall be deemed to have been disclosed by the GMO Parties for purposes of each
other Section of this Agreement to which such disclosure is relevant. Any matter
disclosed by POS-Minerals in the Schedules pursuant to any Section of this
Agreement shall be deemed to have been disclosed by POS-Minerals for purposes
of
each other Section of this Agreement to which such disclosure is
relevant.
“Securities
Act”
means
the U.S. Securities Act of 1933.
“Tax”
or
“Taxes”
means
all taxes, however denominated, foreign or domestic, including any monetary
adjustments, interest, penalties or other additions to tax that may become
payable in respect thereof, imposed by any Tax Authority, which taxes include
all income or profits taxes, payroll and employee withholding taxes,
unemployment insurance, social security taxes, income withholding taxes, sales
and use taxes, value added taxes, ad valorem taxes, excise taxes, franchise
taxes, gross receipts taxes, business or municipal license (patente
municipal)
taxes,
occupation taxes, real and personal property taxes, stamp taxes, environmental
taxes, severance taxes, production taxes, transfer taxes, workers’ compensation,
governmental charges and other obligations of the same or of a similar nature
to
any of the foregoing.
“Tax
Returns”
means
any return, declaration, report, claim for refund or information return or
statement relating to Taxes, including any schedule or attachment thereto and
any amendment thereof.
“Tax
Authority”
means
any Governmental Authority of any kind with the power to impose any
Tax.
“Transaction
Documents”
means
this Agreement, the LLC Agreement, the Assignment of LLC Interest, the POSCAN
Guaranty, and the other agreements, certificates and instruments to be executed
and delivered by the Parties at the Closing pursuant to this Agreement or
pursuant to any of the foregoing documents or instruments (including any
exhibits, schedules, attachments and annexes to any such other agreements,
certificates and instruments).
“U.S.”
means
the United States of America.
CONTRIBUTION
AGREEMENT; Page 7
In
addition to the terms defined above, the following terms are defined in this
Agreement and in the Schedules to this Agreement as indicated
below:
Term
|
Section
|
|
2008
Pre-Closing Expenditures
|
Section
2.4(e)
|
|
Actions
|
Section
5.3(b)
|
|
Actual
2007 Expenditures
|
Section
2.4(e)
|
|
Assignment
of Office Lease
|
Section
2.1(a)(iv)
|
|
Assignment
of Project Lease
|
Section
2.1(a)(iii)
|
|
Assumed
Contracts
|
Schedule
I
|
|
Assumed
Liabilities
|
Schedule
II
|
|
Assumption
Agreement
|
Section
2.1(a)(vii)
|
|
Bankable
Feasibility Study
|
Schedule
I-8
|
|
Xxxx
of Sale and Assignment
|
Section
2.1(a)(ii)
|
|
Bonds
|
Schedule
I
|
|
Budgeted
2007 Expenditures
|
Section
2.4(e)
|
|
Closing
|
Section
2.5
|
|
Closing
Date
|
Section
2.5
|
|
Company
|
Preamble
|
|
Contributed
Assets
|
Schedule
I
|
|
Conveyance
Documents
|
Section
2.1(a)
|
|
Deduction
Percentage
|
Section
2.4(e)
|
|
Deed
of Real Property
|
Section
2.1(a)(v)
|
|
Environmental
Damage
|
Section
3.1(j)(viii)
|
|
ERISA
|
Section
3.1(p)
|
|
Eureka
GMO LLC Interest
|
Recitals
|
|
Eureka
House Lease
|
Schedule
I-4
|
|
Eureka
Office Lease
|
Schedule
I-4
|
|
Eureka
POS LLC Interest
|
Recitals
|
|
Eureka
Trailer Park
|
Schedule
I-5
|
|
Excess
Underfunded Amount
|
Section
2.4(e)
|
|
Excluded
Assets
|
Schedule
I
|
|
Excluded
Liabilities
|
Schedule
II
|
|
Execution
Date
|
Section
2.5
|
|
Exxon
Assignment
|
Schedule
II
|
|
Final
Settlement Date
|
Section
2.4(c)
|
|
First
Contribution Installment
|
Section
2.3(a)(i)
|
|
General
Moly
|
Preamble
|
|
GMO
Party
|
Preamble
|
|
KVR
Water Lease
|
Section
2.1(a)(vi)
|
|
KVR
Water Rights
|
Schedule
I
|
|
Leased
Mineral Properties
|
Schedule
I
|
|
Leased
Real Property
|
Schedule
I
|
|
Material
Contracts
|
Schedule
I
|
|
Mineral
Deed
|
Section
2.1(a)(i)
|
|
Mineral
Properties
|
Schedule
I
|
CONTRIBUTION
AGREEMENT; Page 8
Mount
Hope Water Rights
|
Schedule
I
|
|
Nevada
Moly
|
Preamble
|
|
Objection
Period
|
Section
2.4(b)
|
|
OFAC
|
Section
3.1(r)
|
|
Other
Assets
|
Schedule
I
|
|
Owned
Mineral Properties
|
Schedule
I
|
|
Owned
Real Property
|
Schedule
I
|
|
Party
|
Preamble
|
|
Pending
Approvals
|
Section
2.1(b)
|
|
Permit
Applications
|
Schedule
I
|
|
Permits
|
Schedule
I
|
|
Plan
of Operations
|
Schedule
I-7
|
|
POS-Minerals
|
Preamble
|
|
Post-Closing
Statement
|
Section
2.4(b)
|
|
Project
Lease
|
Schedule
I-3
|
|
Pre-Closing
Date Payment Amount
|
Section
2.4(e)
|
|
Tax
Benefit Factor
|
Section
2.4(e)
|
|
Underfunded
2007 Payment Amount
|
Section
2.4(e)
|
|
Underfunded
2007 Payment Amount Schedule
|
Section
2.4
|
|
Underfunded
Payment Net Tax Benefit Amount
|
Section
2.4(e)
|
|
Vehicles
and Equipment
|
Schedule
I
|
|
Water
Rights
|
Schedule
I
|
1.2 Interpretation.
As used
herein, except as otherwise indicated herein or as the context may otherwise
require: (a) the words “include,” “includes,” and “including” are deemed to be
followed by “without limitation” whether or not they are in fact followed by
such words or words of like import, (b) the words “hereof,” “herein,”
“hereunder,” and comparable terms refer to the entirety of this Agreement,
including the Exhibits and Schedules hereto, and not to any particular article,
section or other subdivision hereof or Exhibit or Schedule hereto, (c) any
pronoun shall include the corresponding masculine, feminine and neuter forms,
(d) the singular includes the plural and vice versa, (e) references to any
agreement or other document are to such agreement or document as amended,
modified, supplemented and restated now or hereafter from time to time, (f)
references to any statute or regulation are to it as amended, modified,
supplemented and restated now or hereafter from time to time, and to any
corresponding provisions of successor statutes or regulations, (g) except as
otherwise expressly provided in this Agreement, references to “Article,”
“Section,” “preamble,” “recital,” or another subdivision or to an “Exhibit” or
“Schedule” are to an article, section, preamble, recital or subdivision hereof
or an “Exhibit” or “ Schedule” hereto, and (h) references to any Person include
such Person’s respective successors and permitted assigns. Any reference herein
to a “day” or number of “days” (without the explicit qualification of
“Business”) shall be deemed to refer to a calendar day or number of calendar
days. If any action or notice is to be taken or given on or by a particular
calendar day, and such calendar day is not a Business Day, then such action
or
notice may be taken or given on the next succeeding Business Day. Any financial
or accounting terms that are not otherwise defined herein shall have the
meanings given thereto under GAAP.
CONTRIBUTION
AGREEMENT; Page 9
ARTICLE
II
CONTRIBUTIONS;
CLOSING
2.1 General
Moly Contributions
of Assets.
(a) Effective
as of the Contribution Date, and in consideration of the formation of the
Company by General Moly and the issuance to General Moly of 100% of the issued
and outstanding limited liability company membership interests of the Company
as
of the Contribution Date, subject to Pending Approvals, General Moly contributed
the Contributed Assets to the Company, free and clear of all Encumbrances other
than Permitted Encumbrances, and the Company assumed the Assumed Liabilities
of
General Moly pursuant to the following agreements, documents and instruments
(the “Conveyance
Documents”):
(i) The
Owned
Mineral Properties were conveyed by General Moly to the Company pursuant to
the
Assignment and Quitclaim Deed, dated as of the Contribution Date, by General
Moly to the Company (the “Mineral
Deed”),
a
fully executed copy of which is attached as Exhibit
E-1;
(ii) The
Assumed Contracts (other than the Project Lease and the Leased Real Property),
the Vehicles and Equipment, the Permits, the Permit Applications, the Bonds
and
the Other Assets were assigned by General Moly to the Company pursuant to the
Xxxx of Sale and Assignment, dated as of the Contribution Date, between General
Moly and the Company (the “Xxxx
of Sale and Assignment”),
a
fully executed copy of which is attached as Exhibit
E-2;
(iii) The
Project Lease, together with the Leased Mineral Properties and the Mount Hope
Water Rights leased thereunder, were assigned by General Moly to the Company
pursuant to the Assignment and Consent to Assignment, dated as of the
Contribution Date, between General Moly and the Company, and consented to by
Mount Hope Mines, Inc. (the “Assignment
of Project Lease”),
a
fully executed copy of which is attached as Exhibit
E-3;
(iv) The
Leased Real Property was assigned by General Moly to the Company pursuant to
the
Assignment of Lease, dated as of the Contribution Date, between General Moly
and
the Company (the “Assignment
of Office Lease”),
a
fully executed copy of which is attached as Exhibit
E-4;
(v) The
Owned
Real Property was assigned by General Moly to the Company pursuant to the Grant
Deed, dated as of the Contribution Date, from General Moly to the Company (the
“Deed
of Real Property”),
a
fully executed copy of which is attached as Exhibit
E-5;
(vi) Kobeh
Valley Ranch has leased the KVR Water Rights to the Company pursuant to, and
after the satisfaction of certain conditions described in, the Water Rights
Lease Agreement, dated as of the Contribution Date, among Kobeh Valley Ranch,
the Company and General Moly, (the “KVR
Water Lease”),
a
fully executed copy of which is attached as Exhibit
E-6;
and
CONTRIBUTION
AGREEMENT; Page 10
(vii) the
Assumed Liabilities were assumed by the Company from General Moly pursuant
to
the Assumption Agreement, dated as of the Contribution Date, between General
Moly and the Company (the “Assumption
Agreement”),
a
fully executed copy of which is attached as Exhibit
E-7.
(b) Notwithstanding
Section
2.1(a)
above,
the Parties acknowledge that the Applications to Change and the Authorizations,
Government Approvals and other actions listed on Schedule
2.1(b)
or that
would not, individually or in the aggregate, have a Material Adverse Effect
(“Pending
Approvals”)
are
still required for the contribution by General Moly to the Company of the
Contributed Assets and the assumption by the Company from General Moly of the
Assumed Liabilities and the vesting of record title of such Contributed Assets
in the Company.
(c) General
Moly and Nevada Moly shall take such actions, and shall cooperate fully with
the
Company, to complete any Pending Approvals in a commercially reasonable manner
and within a commercially reasonable period after the Closing; provided
that the
Parties acknowledge and agree that such Pending Approvals shall be taken in
due
course so as not to disrupt the ongoing development of the Project or the
ongoing approval process with respect to the Plan of Operations. In the event
General Moly is unable to complete a Pending Approval with respect to any
Contributed Asset and such Contributed Asset is reasonably necessary or
desirable in connection with the development and Operation of the Project,
General Moly shall hold all legal and beneficial right, title and interest
in
such Contributed Asset that it has retained as of the Closing, if any, for
the
sole and exclusive benefit of the Company, which shall have all of the benefits
and burdens in respect of such Contributed Asset, until the earlier of the
time
such Pending Approval is completed or the applicable Contributed Asset is no
longer used in or useful for the Project. In the event General Moly is unable
to
complete a Pending Approval with respect to any Assumed Liabilities, the Company
shall perform such Assumed Liabilities, and shall indemnify General Moly and
its
Affiliates from and against any Losses suffered in connection therewith, and
if
the Contributed Asset relating to any such Assumed Liability is no longer needed
as determined by the Company, then General Moly and the Company shall cooperate
to terminate such Assumed Liability at the sole cost and expense of the Company.
POS-Minerals and the Company agree that, notwithstanding any contrary provision
of this Agreement, no representation, warranty or covenant of any of the GMO
Parties contained herein shall be breached or deemed breached as a result of
the
failure of General Moly to perform or complete any Pending Approval;
provided,
that
General Moly complies with its obligations in this Section
2.1(c).
2.2 General
Moly Contribution of LLC Interest.
At the
Closing, General Moly shall contribute, transfer and assign to Nevada Moly
its
entire limited liability company membership interest in the Company, free and
clear of all Encumbrances other than Permitted Encumbrances, pursuant to the
Assignment of LLC Interest.
CONTRIBUTION
AGREEMENT; Page 11
2.3 POS-Minerals
Contribution.
(a) POS-Minerals
shall contribute to the Company the POS-Minerals Initial Contribution as
follows:
(i) Within
fifteen (15) days after the Execution Date, POS-Minerals shall contribute to
the
Company Fifty Million Dollars ($50,000,000.00) (the “First
Contribution Installment”)
of the
POS-Minerals Initial Contribution, by paying such amount by wire transfer of
immediately available funds to the account set forth in Schedule
2.3(a)(i);
and
(ii) The
remaining portion of the POS-Minerals Initial Contribution shall be paid to
the
Company in accordance with the terms and conditions of the LLC
Agreement.
(b) In
consideration for the contribution described in Section
2.3(a),
at the
Closing the Company shall issue to POS-Minerals the Eureka POS LLC
Interest.
2.4 Pre-Closing
Date Expenditures.
(a) Underfunded
2007 Payment Amount.
Schedule
2.4
attached
hereto (the “Underfunded
2007 Payment Amount Schedule”)
represents the GMO Parties’ estimate of the Actual 2007 Expenditures and the
calculation of the Underfunded 2007 Payment Amount based on such estimate of
Actual 2007 Expenditures and the Budgeted 2007 Expenditures. To the extent
any
Actual 2007 Expenditures represent an accrued and unpaid liability required
to
be reflected on a balance sheet prepared in accordance with GAAP as of the
Contribution Date, the GMO Parties acknowledge and agree that such Actual 2007
Expenditures shall remain a liability and obligation of General Moly, and the
Company shall have no liability or responsibility therefor.
(b) Post-Closing
Statement.
Within
ninety (90) days after the Closing, the GMO Parties shall prepare and
deliver to POS-Minerals a statement (the “Post-Closing
Statement”)
setting forth in reasonable detail a final calculation of Actual 2007
Expenditures, the Underfunded 2007 Payment Amount based on such final
calculation of Actual 2007 Expenditures, the 2008 Pre-Closing Expenditures,
a
calculation of the Deduction Percentage, and a calculation of the amounts
determined by Nevada Moly to be payable by Nevada Moly under Section
2.4(d).
The
Post-Closing Statement shall be accompanied by a certificate of the chief
financial officer of Nevada Moly to the effect that the information contained
in
the Post-Closing Statement is fairly presented, in all material respects, in
accordance with GAAP and customary industry accounting practices. POS-Minerals
and its agents and representatives shall be entitled to reasonable access during
normal business hours to the relevant records, personnel and working papers
of
the GMO Parties and the Company to assist in POS-Minerals’ review of the
Post-Closing Statement. Within six (6) months after POS-Minerals’ receipt of the
Post-Closing Statement (the “Objection
Period”),
POS-Minerals shall deliver to Nevada Moly a written report setting forth in
detail any changes or adjustments that POS-Minerals proposes to make to the
Post-Closing Statement and any other objections that POS-Minerals has to the
GMO
Parties’ calculation of any item required to be contained in the Post-Closing
Statement; provided,
that
the Objection Period may be extended for an additional period not to exceed
six
(6) months (for a total period not to exceed one (1) year) with the consent
of
Nevada Moly, such consent not to be unreasonably withheld or delayed.
POS-Minerals’ failure to deliver such a written report to Nevada Moly by the
expiration of the Objection Period, as it may be extended, shall be deemed
an
acceptance by POS-Minerals of the Post-Closing Statement as submitted by the
GMO
Parties, and shall be deemed to have established as of the date of such
expiration the amounts in such Post-Closing Statement for purposes of the second
sentence of Section 2.4(c).
CONTRIBUTION
AGREEMENT; Page 12
(c) Final
Settlement Date.
If
POS-Minerals delivers such a written report to Nevada Moly by the expiration
of
the Objection Period, one or more representations of POS-Minerals and the GMO
Parties shall promptly meet in good faith to attempt to resolve whether any
changes or adjustments proposed by POS-Minerals in such written report shall
be
made, and resolve any other objections POS-Minerals has to the GMO Parties’
calculation of any item required to be contained in the Post-Closing Statement.
If such representatives of POS-Minerals and the GMO Parties do not resolve
whether any such changes or adjustments should be made or such other objections,
as applicable, within sixty (60) days after the receipt by POS-Minerals of
the
proposed Post-Closing Statement, a dispute shall be deemed to exist and shall
be
resolved in accordance with Section
6.3.
The
date upon which all such changes, adjustments and objections are resolved and
memorialized in a writing signed by POS-Minerals and the GMO Parties or upon
which the amounts in the Post-Closing Statement are established pursuant to
the
last sentence of Section 2.4(b)
or
Section
6.3
is
referred to herein as the “Final
Settlement Date.”
(d) Payment.
Within
five (5) Business Days of the Final Settlement Date, Nevada Moly shall make
a
payment in the Pre-Closing Date Payment Amount to POS-Minerals.
(e) Definitions.
As used
in this Section
2.4,
the
follow terms have the meanings indicated:
“2008
Pre-Closing Expenditures”
means
(i) the aggregate costs and expenses actually incurred under GAAP by the GMO
Parties or the Company in connection with the Project for the period from the
Contribution Date through and including the Closing; minus
(ii)
the
amount of any costs and expenses described in clause (i) above that are not
actually paid by the GMO Parties or the Company before the Closing (which costs
and expenses described in this clause
(ii)
the
parties acknowledge will be paid by the Company after the Closing with the
proceeds of the First Contribution Installment).
“Actual
2007 Expenditures”
is
defined in the definition of “Underfunded 2007 Payment Amount.”
“Budgeted
2007 Expenditures”
is
defined in the definition of “Underfunded 2007 Payment Amount.”
“Deduction
Percentage”
means
the percentage of the 2008 Pre-Closing Expenditures that are properly deductible
for federal income tax purposes.
“Excess
Underfunded Amount”
means
the amount by which the Underfunded 2007 Payment Amount exceeds the 2008
Pre-Closing Expenditures.
CONTRIBUTION
AGREEMENT; Page 13
“Pre-Closing
Date Payment Amount”
means
an amount equal to (i) a decimal fraction equal to twenty percent (20%);
multiplied
by
(ii) the
difference of (A) the Excess Underfunded Amount, minus
(B) the
Underfunded Payment Net Tax Benefit Amount. An example of the calculation of
the
Excess Underfunded Amount, Underfunded Payment Net Tax Benefit Amount and
Pre-Closing Date Payment Amount is attached as Exhibit
F.
“Tax
Benefit Factor”
means
a
decimal fraction equal to the product of (i) thirty percent (30%);
multiplied
by
(ii) the
Deduction Percentage.
“Underfunded
2007 Payment Amount”
means
an amount equal to (i) the costs and expenses budgeted by General Moly to be
incurred under GAAP with respect to the Project from the period from September
1, 2007 through and including December 31, 2007 in
the
amount of $33,859,000 (“Budgeted
2007 Expenditures”),
minus
(ii) the
costs and expenses actually incurred under GAAP by General Moly in connection
with the Project for the period from September 1, 2007 through and including
December 31, 2007 (“Actual
2007 Expenditures”).
A
reconciliation of the GMO Parties’ estimate of Actual 2007 Expenditures to
Budgeted 2007 Expenditures is set forth in the Underfunded 2007 Payment Amount
Schedule attached hereto as Schedule
2.4.
“Underfunded
Payment Net Tax Benefit Amount”
means
an amount equal to the product of (i) the Excess Underfunded Amount;
multiplied
by
(ii) the
Tax Benefit Factor.
2.5 Closing.
The
closing of the transactions provided for in this Agreement (the “Closing”)
shall
take place at the offices of Holme Xxxxxxx & Xxxx LLP, at 0000 Xxxxxxx
Xxxxxx, Xxxxx 0000, Xxxxxx, Xxxxxxxx 00000 upon the receipt by the Company
of
the First Contribution Installment.
All of
the Closing deliveries described in Section
2.6
below
shall be executed in advance of the Closing and held by the Parties in escrow
(other than the legal opinion to be delivered at the Closing) (the date on
which
the last of such Closing deliveries are executed and placed into escrow is
referred to herein as the “Execution
Date”)
until
the receipt by the Company of the First Contribution Installment, at which
time
this Agreement and such other closing deliveries shall be dated and shall be
deemed effective, and counsel for POSCAN shall deliver the legal opinion
required to be delivered under Section
2.6.
This
Agreement and the other closing deliveries required under Section
2.6
shall
not be effective, and shall have no force and effect until the Closing. In
the
event the First Contribution Installment is not received by the Company by
February 29, 2008, this Agreement and such other closing deliveries shall be
void ab
initio.
The
date that the Closing occurs is referred to herein as the “Closing
Date”.
2.6 Closing
Deliveries.
(a) Closing
Deliveries of the GMO Parties.
At the
Closing, the GMO Parties shall deliver the following:
(i) the
LLC
Agreement, duly executed by the manager of Nevada Moly;
(ii) the
Assignment of LLC Interest, duly executed by an authorized officer of General
Moly and the manager of Nevada Moly;
CONTRIBUTION
AGREEMENT; Page 14
(iii) copies
of
the Authorizations and Governmental Approvals set forth in Schedule
3.1(e);
(iv) a
certificate from the manager of Nevada Moly and an officer of General Moly
as to
the matters described in Section 4.2(b) of the Project Lease;
(v) a
certificate of the manager of Nevada Moly, dated as of the Closing Date, in
form
and substance reasonably satisfactory to POS-Minerals, as to (A) the certificate
of formation and limited liability agreement of Nevada Moly; (B) resolutions
of
the manager of Nevada Moly authorizing the execution, delivery and performance
by Nevada Moly of the Transaction Documents to which it is a party, and the
consummation by Nevada Moly of the transactions provided for herein and therein;
and (C) incumbency and signatures of the Persons duly authorized to execute
such
Transaction Documents on behalf of Nevada Moly;
(vi) a
copy of
a certificate issued by the Secretary of State of the State of Delaware, U.S.,
dated as of a recent date reasonably acceptable to POS-Minerals, relating to
the
good standing of Nevada Moly in the State of Delaware, U.S.;
(vii) a
certificate of the secretary, an assistant secretary or a Person serving in
a
similar capacity of General Moly, dated as of the Closing Date, in form and
substance reasonably satisfactory to POS-Minerals, as to (A) the certificate
of
incorporation and bylaws of General Moly; (B) the resolutions of the board
of
directors of General Moly authorizing the execution, delivery and performance
by
General Moly of the Transaction Documents to which it is a party, and the
consummation by General Moly of the transactions provided for herein and
therein; and (C) incumbency and signatures of the officers of General Moly
to
execute such Transaction Documents on behalf of General Moly;
(viii) a
copy of
a certificate issued by the Secretary of State of the State of Delaware, U.S.,
dated as of a recent date reasonably acceptable to POS-Minerals, relating to
the
good standing of General Moly in the State of Delaware, U.S.;
(ix) a
non-foreign affidavit dated as of the Closing Date, executed by an authorized
officer of General Moly, sworn under penalty of perjury and in form and
substance required under the U.S. Department of Treasury regulations issued
pursuant to Code section 1445 stating that the General Moly is not a “foreign
person” as defined in Code section 1445; and
(x) such
other documents and instruments as POS-Minerals has reasonably requested before
the Closing Date.
(b) Closing
Deliveries of POS-Minerals.
At the
Closing, POS-Minerals shall deliver the following:
CONTRIBUTION
AGREEMENT; Page 15
(i) the
First
Contribution Installment;
(ii) the
LLC
Agreement, duly executed by an authorized officer of POS-Minerals;
(iii) the
POSCAN Guaranty, duly executed by an authorized officer of POSCAN;
(iv) a
certificate from an officer of POS-Minerals and an officer of POSCAN as to
the
matters described in Section 4.2(b) of the Project Lease;
(v) a
certificate of the secretary of POS-Minerals, dated as of the Closing Date,
in
form and substance reasonably satisfactory to the GMO Parties, as to (A) the
certification of incorporation and bylaws of POS-Minerals; (B) resolutions
of
the board of directors of POS-Minerals authorizing the execution, delivery
and
performance by POS-Minerals of the Transaction Documents to which it is a party,
and the consummation by POS-Minerals of the transactions provided for herein
and
therein; and (C) incumbency and signatures of the officers of POS-Minerals
duly
authorized to execute such Transaction Documents on behalf of
POS-Minerals;
(vi) a
copy of
a certificate issued by the Secretary of State of the State of Delaware, U.S.,
dated as of a recent date reasonably acceptable to General Moly, relating to
the
good standing of POS-Minerals in the State of Delaware, U.S.;
(vii) certificates
of the President and/or Secretary of POSCAN, dated as of the Closing Date,
in
form and substance reasonably satisfactory to General Moly, as to (A) the
constating documents of POSCAN; (B) resolutions of the sole director of
POSCAN authorizing the execution, ratification and approval by POSCAN of the
POSCAN Guaranty and the transactions provided for therein; and (C) incumbency
and signatures of the officers of POSCAN duly authorized to execute the POSCAN
Guaranty on behalf of POSCAN;
(viii) a
copy of
a certificate issued by the Registrar of Companies of the Province of British
Columbia, dated as of a recent date reasonably acceptable to General Moly,
relating to the existence and company status of POSCAN in British Columbia,
Canada;
(ix) an
opinion, dated the Closing Date, of Xxxxxxxx Law Corporation, Canadian counsel
to POSCAN, substantially in the form of Exhibit
G;
and
(x) such
other documents and instruments as any of the GMO Parties has reasonably
requested before the Closing Date.
CONTRIBUTION
AGREEMENT; Page 16
(c) Closing
Deliveries of the Company.
At the
Closing, the Company shall deliver the following:
(i) a
certificate from the manager of the Company as to the matters described in
Section 4.2(b) of the Project Lease;
(ii) a
certificate of the manager of the Company, dated as of the Closing Date, in
form
and substance reasonably satisfactory to POS-Minerals, as to (A) the certificate
of formation and limited liability company agreement of the Company;
(B) resolutions of the Company’s manager authorizing the execution,
delivery and performance by the Company of this Agreement and the consummation
by the Company of the transactions provided for herein, and the admission of
Nevada Moly and POS-Minerals as Members; and (C) incumbency and signatures
of
the Persons duly authorized to execute such Transaction Documents on behalf
of
the Company;
(iii) a
copy of
a certificate issued by the Secretary of State of the State of Delaware, dated
as of a recent date reasonably acceptable to POS-Minerals, relating to the
good
standing of the Company in the State of Delaware, U.S.; and
(iv) such
other documents and instruments as any of the GMO Parties or POS-Minerals has
reasonably requested before the Closing Date.
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES
3.1 Representations
and Warranties of the
GMO Parties.
Each
of
the GMO Parties jointly and severally represents and warrants to the Company
and
POS-Minerals, as of the Closing Date (except to the extent such representation
and warranty specifically speaks as of a different date), as
follows:
(a) Power
and Authority of Nevada Moly.
Nevada
Moly:
(i) is
a
limited liability company duly organized, validly existing and in good standing
under the Laws of the State of Delaware, U.S.;
(ii) is
qualified to do business and is in good standing in those states where necessary
in order to carry out its obligations under this Agreement and the other
Transaction Documents to which it is or will be a party; and
(iii) (A)
has
all requisite limited liability company power and authority to enter into,
and
to perform its obligations under, this Agreement and the other Transaction
Documents to which it is or will be a party, and (B) the execution and delivery
by it of this Agreement and the other Transaction Documents to which it is
or
will be a party, and the performance by it of its obligations hereunder and
thereunder, have been duly authorized by all requisite limited liability company
action on the party of Nevada Moly.
CONTRIBUTION
AGREEMENT; Page 17
(b) Power
and Authority of General Moly.
General
Moly:
(i) is
a
corporation duly incorporated, validly existing and in good standing under
the
Laws of the State of Delaware, U.S.;
(ii) is
qualified to do business and is in good standing in those states where necessary
in order to carry out its obligations under this Agreement and the other
Transactions Documents to which it is or will be a party; and
(iii) (A)
has
all requisite corporate power and authority to enter into, and to perform its
obligations under, this Agreement and the other Transaction Documents to which
it is or will be a party, and (B) the execution and delivery by it of this
Agreement and the other Transaction Documents to which it is or will be a party,
and the performance by it of its obligations hereunder and thereunder, have
been
duly authorized by all requisite corporate action on the part of General
Moly.
(c) Power
and Authority of the Company.
The
Company:
(i) is
a
limited liability company duly organized, validly existing and in good standing
under the Laws of the State of Delaware, U.S.;
(ii) is
qualified to do business and is in good standing in Nevada, U.S., and in those
other states where necessary in order to carry out its obligations under this
Agreement and the other Transactions Documents to which it is or will be a
party; and
(iii) (A)
has
all requisite limited liability company power and authority to enter into,
and
to perform its obligations under, this Agreement, and (B) the execution and
delivery by it of this Agreement and the performance by it of its obligations
hereunder and thereunder, have been duly authorized by all requisite limited
liability company action on the part of the Company.
(d) Validity.
This
Agreement and the other Transaction Documents to which each GMO Party or the
Company is or will be a party, have, or will at the Closing be, duly executed
and delivered by such GMO Party or the Company, as applicable, and, assuming
the
due execution and delivery by each other party thereto, constitutes or will
constitute, as applicable, such GMO Party’s or the Company’s, as applicable,
legal, valid, and binding obligation, enforceable against such GMO Party or
the
Company, as applicable, in accordance with their respective terms, except as
such enforceability may be affected by applicable bankruptcy, reorganization,
insolvency, moratorium, or similar Laws affecting creditors’ rights generally,
or by general principles of equity.
(e) Authorizations
and Governmental Approvals.
Except
for the Pending Approvals listed on Schedule
2.1(b),
and
except for those Authorizations or Government Approvals that have been obtained
or made, including the Authorizations and Approvals set forth in Schedule
3.1(e),
no
Authorization or Government Approval is required in connection with the
execution, delivery or performance by any GMO Party or the Company of this
Agreement or any other Transaction Documents to which it is or will be a party,
or the consummation of the transactions provided for herein and therein by
such
GMO Party or the Company.
CONTRIBUTION
AGREEMENT; Page 18
(f) No
Conflicts.
The
execution and delivery by each GMO Party and the Company of this Agreement
do
not, the execution and delivery by each GMO Party and the Company of the other
Transaction Documents to which such GMO Party or the Company, respectively,
is a
party will not, and the performance by each such GMO Party and the Company
of
its obligations hereunder and thereunder and the consummation of the
transactions provided for herein and therein will not, (i) violate or conflict
with any provision of its Governing Documents, (ii) except for any Pending
Approvals, violate any of the terms, conditions, or provisions of any Law or
Government Approval to which such GMO Party or the Company is subject or by
which it or any of its assets is bound, or (iii) except for any Pending
Approvals, result in a violation or breach of, or (with or without the giving
of
notice or lapse of time or both) constitute a default (or give rise to any
right
of termination or cancellation) under, or give rise to or accelerate any
material obligation under, or pursuant to, any Material Contract.
(g) Brokers’
and Finders’ Fees.
There
is no broker, finder, investment banker, or similar intermediary that has been
retained by, or is authorized to act on behalf of, the Company, any GMO Party
or
any of its Affiliates or any of their respective officers or directors who
is or
will be entitled to any fee or commission in connection with this Agreement
or
the other Transaction Documents, which fee or commission could be or become
a
liability of POS-Minerals or the Company.
(h) Investment
Intent.
Nevada
Moly is not acquiring the Eureka GMO LLC Interest with a view to or for sale
in
connection with any distributions thereof within the meaning of the Securities
Act.
(i) Legal
Proceedings.
There
is no Legal Proceeding pending, or to the Knowledge of the GMO Parties,
threatened, against any GMO Party or their Affiliates or the Company that (i)
questions the validity of any of the Transaction Documents or the right of
such
GMO Party or the Company to enter into any Transaction Document to which it
is
or will be a party or to consummate the transactions provided for herein or
therein, or (ii) if adversely determined, would reasonably be expected to
have a Material Adverse Effect.
(j) Contributed
Assets.
(i) With
respect to the Contributed Assets (other than the Leased Real Property, the
Leased Mineral Properties, the Owned Mineral Properties and the Water Rights),
the Company is in exclusive possession of and owns such Contributed Assets
free
and clear of all Encumbrances or defects in title, except for Permitted
Encumbrances. Except as described on Schedule
3.1(j)(i)
and
except as would not have a Material Adverse Effect, General Moly and Nevada
Moly
are, General Moly has been for the three years preceding the Closing Date,
and
Nevada Moly has been since the date of its formation, in compliance with all
Laws to which the business of General Moly or Nevada Moly or the Contributed
Assets is subject. Except as described on Schedule
3.1(j)(i)
and
except as would not have a Material Adverse Effect, General Moly has not during
the three years preceding the Closing Date, and Nevada Moly has not since the
date of its formation, received any written notice or other written
communication from any Governmental Authority regarding an actual, possible
or
alleged violation or failure to comply with any Law to which the business of
General Moly or Nevada Moly or the Contributed Assets is subject.
CONTRIBUTION
AGREEMENT; Page 19
(ii) With
respect to the Leased Real Property, the Company has a good and valid leasehold
interest in such Leased Real Property, free and clear of any Encumbrances,
except for Permitted Encumbrances, and none of the Leased Real Property is
subject to any sublease or grant to any Person (other than the Company) of
any
right to the use, occupancy or enjoyment thereof.
(iii) With
respect to the Leased Mineral Properties (which the Company holds an interest
under the Project Lease): (A) the Company is in exclusive possession of
such Leased Mineral Properties; (B) none of the GMO Parties or the Company
has received any notice of default of any of the terms or provisions of the
Project Lease; (C) the Company has the authority under the Project Lease to
perform fully its obligations under this Agreement and the other Transaction
Documents to which it is or will be a party; (D) to the GMO Parties’
Knowledge, the Project Lease is valid and in good standing; (E) the GMO
Parties have no Knowledge of any act or omission or any condition on such
Mineral Properties that could be considered or construed as a default under
the
Project Lease; and (F) to the GMO Parties’ Knowledge, such Leased Mineral
Properties are free and clear of all Encumbrances or defects in title, except
for Permitted Encumbrances.
(iv) The
GMO
Parties have delivered to or made available for inspection by POS-Minerals
all
material information concerning title to the Contributed Assets in which the
Company holds an interest.
(v) The
Company (A) has the rights to use the Mount Hope Water Rights under and pursuant
to the terms of the Project Lease, and (B) has the rights to use the KVR Water
Rights as and to the extent set forth in and pursuant to the terms of the KVR
Water Lease free and clear of any Encumbrances, except for Permitted
Encumbrances and the terms of the KVR Water Lease, and, except as provided
in
the KVR Water Lease, none of the KVR Water Rights is subject to any sublease
or
grant by Kobeh Valley Ranch or General Moly to any Person (other than the
Company) of any right to the use or enjoyment thereof. To the Knowledge of
the
GMO Parties, subject to receipt of the Applications to Change, the Water Rights
will constitute sufficient water rights for the Project as contemplated by
the
Bankable Feasibility Study.
(vi) Except
as
set forth on Schedule
3.1(j)(vi)
or Part
B of Schedule
I-1,
with
respect to unpatented mining claims located by General Moly that are included
within the Owned Minerals Properties of the Company, and subject to the
paramount title of the U.S.: (A) the unpatented mining claims were properly
laid out and monumented, (B) all required location and validation work was
properly performed, (C) location notices and certificates were properly
recorded and filed with appropriate Governmental Authorities, (D) all
assessment work required to hold the unpatented mining claims has been performed
and all Governmental Fees have been paid in a manner consistent with that
required of the Manager pursuant to Section 7.2(m) of the LLC Agreement through
the assessment year ending September 1, 2007, (E) all affidavits of
assessment work, evidence of payment of Governmental Fees, and other filings
required to maintain the claims in good standing have been properly and timely
recorded or filed with appropriate Governmental Authorities, (F) the claims
are free and clear of Encumbrances except for Permitted Encumbrances, and
(G) the GMO Parties’ have no Knowledge of conflicting claims. Nothing in
this Section
3.1(j)(vi)
or Part
B of Schedule
I-1,
however, shall be deemed to be a representation or a warranty that any of the
unpatented mining claims contains a discovery of minerals. With respect to
those
unpatented mining claims that were not located by either or both of the GMO
Parties but are included within the Owned Mineral Properties, the GMO Parties
make the foregoing representations and warranties (with the foregoing
exceptions) to the Knowledge of the GMO Parties.
CONTRIBUTION
AGREEMENT; Page 20
(vii) To
the
Knowledge of the GMO Parties, there are no pending or threatened Legal
Proceedings with respect to the Contributed Assets.
(viii) Except
as
provided on Schedule
3.1(j)(viii),
and
except as to matters otherwise disclosed in writing to POS-Minerals before
the
Closing Date, (A) to the Knowledge of the GMO Parties, the conditions
existing on or with respect to the Mineral Properties and the ownership and
operation of the Mineral Properties by any of the GMO Parties or the Company,
are not in violation of any Laws (including any Environmental Laws), nor causing
or permitting any damage (including Environmental Damage, as defined below)
or
impairment to the health, safety or enjoyment of any Person at or on the Mineral
Properties or in the general vicinity of the Mineral Properties; (B) to the
Knowledge of the GMO Parties, there have been no unremedied past violations
by
them or by any of their predecessors in title of any Environmental Laws or
other
Laws affecting or pertaining to the Mineral Properties, nor any unremedied
past
creation of damage or threatened damage to the air, soil, surface waters,
groundwater, flora, fauna, or other natural resources on, about or in the
general vicinity of the Mineral Properties (“Environmental
Damage”);
and
(C) none of the GMO Parties or the Company has received written inquiry
from or written notice of a pending investigation from any Governmental
Authority or of any administrative or judicial proceeding concerning the
violation of any Laws or any damage, threatened damage or impairment to any
natural person, property or environmental or natural resources values by the
GMO
Parties.
(ix) General
Moly and Nevada Moly have transferred all of their respective right, title
and
interest in and to all trade secrets, patents, inventions, copyrights, copyright
registrations and applications, trademarks, trademark registrations and
applications, service marks, service xxxx registrations and applications,
know-how, formulae and processes from General Moly or Nevada Moly, in each
case
which is necessary for and material to the operation or development of the
Project,
none of
which has been licensed by General Moly or Nevada Moly to any third Person.
There are no claims pending or, to the Knowledge of the GMO Parties, threatened
against General Moly or Nevada Moly alleging that either of them violates the
intellectual property rights of any third Person.
CONTRIBUTION
AGREEMENT; Page 21
(x) Schedule
3.1(j)(x)
sets
forth a list of each material insurance policy and fidelity bond which covers
the Contributed Assets or the Company or its business, properties, assets,
directors or employees. Such policies are in full force and effect in all
material respects and neither the Company nor any GMO Party is in default with
respect to its obligations under any such policy, except where such default
would not reasonably be expected to have a Material Adverse Effect.
(k) Bankable
Feasibility Study.
The GMO
Parties have delivered to POS-Minerals as an inducement to enter into this
Agreement, and acknowledge and understand that POS-Minerals has relied upon,
a
true and correct copy of the Bankable Feasibility Study, Volume I of which
is
attached hereto as Exhibit
G
and
Volume II of which is incorporated herein by reference. The factual information
provided by General Moly in connection with the preparation of the Bankable
Feasibility Study did not contain, at the time provided, any material
misrepresentation or misstatement. To the Knowledge of the GMO Parties, the
Bankable Feasibility Study was prepared by “Qualified Persons” (as such term is
defined in Canadian Standard NI 43-101) in accordance with the Canadian Standard
NI 43-101 for industry consistency. Notwithstanding the foregoing, the GMO
Parties make no representations or warranties regarding the accuracy of any
projections, predictions or other estimation of future events set forth in
the
Bankable Feasibility Study or otherwise, or as to the legal or other conclusions
to be drawn from the Bankable Feasibility Study.
(l) Material
Contracts.
The
Material Contracts and the Conveyance Documents are all of the material
contracts, agreements, leases, purchase orders and other agreements to which
any
of the GMO Parties or the Company is a party that are used primarily or that
relate primarily to the Project. Except as set forth on Schedule
I-3,
and
except for any amendments, modifications and supplements to the Material
Contracts pursuant to the Conveyance Documents or the Transaction Documents,
none of the Material Contracts has been amended, modified or supplemented.
To
the Knowledge of the GMO Parties, all of the Material Contracts are in full
force and effect, except as such enforceability may be affected by applicable
bankruptcy, reorganization, insolvency, moratorium or similar Laws affecting
creditors’ rights generally and subject to general principles of equity. None of
the Material Contracts have been terminated, suspended or rescinded by any
GMO
Party or the Company, or to the Knowledge of the GMO Parties, any other party
thereto. The GMO Parties and the Company are not, and to the Knowledge of the
GMO Parties, none of the other parties to the Material Contracts are, in default
in the performance of any covenant or obligation set forth in, or otherwise
in
default under, any of the Material Contracts, which default would reasonably
be
expected to have a Material Adverse Effect.
CONTRIBUTION
AGREEMENT; Page 22
(m) Newly
Formed Entity.
(i) Other
than the Assumed Liabilities and liabilities and obligations incurred in the
ordinary course of business, as of immediately prior to the Contribution Date,
the Company had no (A) outstanding Indebtedness, or (B) liabilities (whether
known or unknown, whether asserted or unasserted, whether absolute or
contingent, whether accrued or unaccrued, whether liquidated or unliquidated,
and whether due or to become due, including any liability for Taxes), in each
case that are required to be shown on a balance sheet prepared in accordance
with GAAP.
(ii) Except
for the Contributed Assets, as of immediately prior to the Closing, the Company
had no (A) real or personal property, (B) subsidiaries, (C) Permits or
Applications for Permits or (D) other than the development and Operation of
the
Project, any operations.
(iii) Since
its
formation, the sole record owner of all securities (equity or debt) of Nevada
Moly is and has been General Moly. From its formation to the time immediately
prior to the Closing, the sole record owner of all securities (equity or debt)
of the Company is and has been General Moly. Other
than the Transaction Documents, there are no agreements, contracts, commitments,
arrangements or understandings requiring the issuance, sale or transfer of
any
equity or debt securities of the Company. To the Knowledge of the GMO Parties,
none of the outstanding equity securities of the Company was issued in violation
of the Securities Act or any other applicable Law.
The
Company has no debt securities outstanding. No election has been filed by or
on
behalf of the Company to cause the Company to be treated as a corporation or
association for Tax purposes.
(n) Employment.
The
Company is not liable for the payment of any compensation, damages, Taxes,
fines, penalties or other amounts, however designated, for failure to comply
with any Law relating to employment, equal employment opportunity,
nondiscrimination, immigration, wages, hours, benefits, collective bargaining,
the payment of social security and similar Taxes, and occupational safety and
health. The Company has no employees and has never had any
employees.
(o) Taxes.
(i) Nevada
Moly, General Moly and the Company have filed or caused to be filed all Tax
Returns that are or were required to be filed by them or with respect to them
or
the Contributed Assets, either separately or as a member of a group of
corporations, under applicable Law. Nevada Moly, General Moly and the Company
have paid all Taxes that may have become due pursuant to such Tax Returns and
all Taxes due or claimed to be due by any Governmental Authority. Where
required, timely estimated payments or installment payments of Tax liabilities
have been made to all Governmental Authorities in amounts sufficient to avoid
underpayment penalties or late payment penalties applicable
thereto.
CONTRIBUTION
AGREEMENT; Page 23
(ii) All
Tax
Returns filed by the Nevada Moly, General Moly and the Company (or including
Nevada Moly, General Moly or the Company on a consolidated basis) with respect
to the Contributed Assets are materially true, correct and complete and, to
the
Knowledge of the GMO Parties, no Governmental Authority has made any claims
against or inquiries of Nevada Moly, General Moly or the Company with respect
to
the Contributed Assets and relating to any jurisdictions with which Nevada
Moly,
General Moly or the Company do not currently file Tax Returns (either separately
or on a consolidated basis with any of its affiliates).
(iii) To
the
Knowledge of the GMO Parties, Nevada Moly, General Moly and the Company have
withheld and paid (or have caused to be withheld and paid on their behalf)
all
Taxes required to have been withheld and paid in connection with amounts paid
or
owing to any third party.
(iv) There
is
no audit currently pending or, to the Knowledge of the GMO Parties, threatened,
against Nevada Moly, General Moly (with respect to the Contributed Assets)
or
the Company in respect of any Taxes. There are no Encumbrances on any of the
Contributed Assets that arose in connection with any failure (or alleged
failure) to pay any Tax, other than Permitted Encumbrances and Encumbrances
for
Taxes not yet due and payable.
(v) Neither
Nevada Moly, General Moly nor the Company has waived (or is or would be subject
to any waivers given by any other Person) any statute of limitations in respect
of Taxes. Neither Nevada Moly, General Moly nor the Company has agreed (or
is or
would be subject to any agreement made by any other Person) to any extension
of
time with respect to a Tax assessment or deficiency.
(vi) During
the three years preceding the Closing Date, to the Knowledge of the GMO Parties,
neither Nevada Moly, General Moly nor the Company is or has been subject to
any
examination or audit by any Governmental Authority.
(p) ERISA.
The
Company does not now maintain or contribute to, has not ever maintained or
contributed to, and, except as provided pursuant to the LLC Agreement, has
no
plans or commitments for, (i) any employee pension benefit plan (as such term
is
defined in Section 3(2) of the Employee Retirement Income Security Act of 1974,
as amended (“ERISA”))
that
is subject to Title IV of ERISA or (ii) any “employee benefit plan” (as such
term is defined in Section 3(3) of ERISA). Neither the Company nor any
“affiliate” (as such term is defined in Section 4001(b) of ERISA) of the Company
has ever contributed to, been obligated to contribute to, or, except as provided
pursuant to the LLC Agreement, has any plans or commitments to contribute to,
a
multiemployer plan (as such term is defined in ERISA Section 3(37)). The
Company does not now have any liability and has not ever had any liability
under
any employee benefit plan sponsored or maintained by the GMO Parties as an
“affiliate” (as such term is defined in Section 4001(b) of ERISA) of the GMO
Parties and/or as a participating employer in any such plan.
CONTRIBUTION
AGREEMENT; Page 24
(q) Knowledge
of Breach.
None of
the GMO Parties or the Company has Knowledge of any breach by POS-Minerals
of
its representations and warranties, covenants or agreements set forth in this
Agreement, or any event, circumstance or occurrence that, with notice or the
passage of time, would be a breach by POS-Minerals of any of its representations
and warranties, covenants or agreements set forth in this
Agreement.
(r) OFAC.
To the Knowledge of the GMO Parties, neither the GMO Parties nor the Company
nor
any of their respective Affiliates is a Person with whom POS-Minerals is
restricted from doing business with under regulations of the Office of Foreign
Asset Control (“OFAC”)
of the
U.S. Department of the Treasury (including, those named on OFAC’s
Specially Designated and Blocked Persons list as of the date hereof) or under
any related Law, including Executive Order 13224 Blocking Property and
Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support
Terrorism, dated September 23, 2001, issued by the President of the U.S.,
or other similar Law.
(s) Limitations.
EXCEPT
FOR THE REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS EXPRESSLY SET
FORTH IN THIS AGREEMENT, THE GMO PARTIES MAKE NO REPRESENTATIONS OR WARRANTIES
OF ANY KIND OR NATURE, EXPRESS OR IMPLIED, AT LAW OR IN EQUITY, WITH RESPECT
TO
THEMSELVES, THE CONTRIBUTED ASSETS, THE ASSUMED LIABILITIES, THE COMPANY OR
THE
TRANSACTIONS PROVIDED FOR IN THIS AGREEMENT, THE OTHER TRANSACTION DOCUMENTS
AND
THE CONVEYANCE DOCUMENTS, AND HEREBY EXPRESSLY DISCLAIM ANY IMPLIED WARRANTIES,
INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE OR AN ORDINARY PURPOSE, TITLE OR NON-INFRINGEMENT, OR
VALUE.
3.2 Representations
and Warranties of POS-Minerals.
POS-Minerals represents and warrants to the Company and the GMO Parties, as
of
the Closing Date (except to the extent such representation and warranty
specifically speaks as of a different date), as follows:
(a) Power
and Authority of POS-Minerals.
POS-Minerals:
(i) is
a
corporation duly organized, validly existing and in good standing under the
Laws
of the State of Delaware, U.S.;
(ii) is
qualified to do business and is in good standing in those states where necessary
in order to carry out its obligations under this Agreement and the other
Transaction Documents to which it is or will be a party; and
(iii) (A)
has
all requisite corporate power and authority to enter into, and to perform its
obligations under, this Agreement and the other Transaction Documents to which
it is or will be a party, and (B) the execution and delivery by it of this
Agreement and the other Transaction Documents to which it is or will be a party,
and the performance by it of its obligations hereunder and thereunder, have
been
duly authorized by all corporate action on the part of
POS-Minerals.
CONTRIBUTION
AGREEMENT; Page 25
(b) Validity.
This
Agreement and the other Transaction Documents to which POS-Minerals is or will
be a party, have or will at the Closing be duly executed and delivered by
POS-Minerals, and, assuming the due execution and delivery by each other party
thereto, constitutes or will constitute, as applicable, POS-Mineral’s legal,
valid and binding obligation, enforceable against POS-Minerals in accordance
with their respective terms, except as such enforceability may be affected
by
applicable bankruptcy, reorganization, insolvency, moratorium or similar Laws
affecting creditors’ rights generally, or by general principles of
equity.
(c) Authorizations
and Governmental Approvals.
Except
for those Authorizations or Government Approvals that have been obtained or
made, no Authorization or Government Approval is required in connection with
the
execution, delivery or performance by POS-Minerals of this Agreement or any
other Transaction Documents to which it is or will be a party, or the
consummation of the transactions provided for herein and therein by
POS-Minerals.
(d) No
Conflicts.
The
execution and delivery by POS-Minerals of this Agreement does not, the execution
and delivery by POS-Minerals of the other Transaction Documents to which it
is a
party will not, and the performance by POS-Minerals of its obligations hereunder
and thereunder and the consummation of the transactions provided for herein
and
therein, will not, (i) violate or conflict with any provision of its Governing
Documents, (ii) violate any of the terms, conditions, or provisions of any
Law
or Government Approval to which POS-Minerals is subject or by which it or any
of
its assets is bound, or (iii) result in a violation or breach of, or (with
or
without the giving of notice or lapse of time or both) constitute a default
(or
give rise to any right of termination or cancellation) under, or give rise
to or
accelerate any material obligation under, or pursuant to, any material contract,
agreement, lease, Permit or other agreement to which it is a party or by which
it or any of its assets is bound.
(e) Brokers’
and Finders’ Fees.
There
is no broker, finder, investment banker, or similar intermediary that has been
retained by, or is authorized to act on behalf of, POS-Minerals or any of its
Affiliates or any of their respective officers or directors who is or will
be
entitled to any fee or commission in connection with this Agreement or the
other
Transaction Documents, which fee or commission could be or become a liability
of
the Company or any GMO Party.
(f) Investment
Intent.
POS-Minerals is not acquiring the Eureka POS LLC Interest with a view to or
for
sale in connection with any distributions thereof within the meaning of the
Securities Act.
(g) Legal
Proceedings.
There
is no Legal Proceeding pending, or to the Knowledge of POS-Minerals, threatened,
against POS-Minerals or any of its Affiliates that (i) questions the validity
of
any of the Transaction Documents or the right of POS-Minerals to enter into
any
Transaction Document or to consummate the transactions provided for herein
or
therein or, (ii) if adversely determined, would reasonably be expected to have
a
material adverse effect on the ability of POS-Minerals to consummate the
transactions provided for in this Agreement and the other Transaction Documents
or to perform its obligations hereunder or thereunder.
CONTRIBUTION
AGREEMENT; Page 26
(h) Knowledge
of Breach.
POS-Minerals has no Knowledge of any breach by any other Party of such other
Party’s representations and warranties, covenants or agreements set forth in
this Agreement, or any event, circumstance or occurrence that, with notice
or
the passage of time, would be a breach by any such other Party of any of its
representations and warranties, covenants or agreements set forth in this
Agreement.
(i) OFAC.
To the Knowledge of POS-Minerals, neither POS-Minerals nor any of its Affiliates
is a Person with whom the GMO Parties or the Company are restricted from doing
business with under regulations of OFAC (including, those named on OFAC’s
Specially Designated and Blocked Persons list as of the date hereof) or under
any related Law, including, the Executive Order 13224 Blocking Property and
Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support
Terrorism, dated September 23, 2001, issued by the President of the U.S.,
or other similar Law.
(j) Independent
Investigation.
POS-MINERALS HAS UNDERTAKEN ITS OWN INVESTIGATION OF THE CONTRIBUTED ASSETS,
THE
ASSUMED LIABILITIES, THE BANKABLE FEASIBILITY STUDY AND THE PROJECT, AND HAS
MADE ITS OWN DECISION TO ENTER INTO THIS AGREEMENT AND THE OTHER TRANSACTION
DOCUMENTS TO WHICH IT IS A PARTY AND TO CONSUMMATE THE TRANSACTIONS PROVIDED
FOR
HEREIN AND THEREIN.
(k) Limitations.
EXCEPT
FOR THE REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS EXPRESSLY SET
FORTH IN THIS AGREEMENT, POS-MINERALS MAKES NO REPRESENTATIONS OR WARRANTIES
OF
ANY KIND OR NATURE, EXPRESS OR IMPLIED, AT LAW OR IN EQUITY, WITH RESPECT TO
THE
TRANSACTIONS PROVIDED FOR IN THIS AGREEMENT, THE OTHER TRANSACTION DOCUMENTS
AND
THE CONVEYANCE DOCUMENTS, AND HEREBY EXPRESSLY DISCLAIMS MAKING ANY IMPLIED
WARRANTIES, INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR
A
PARTICULAR PURPOSE OR AN ORDINARY PURPOSE, TITLE OR NON-INFRINGEMENT, OR
VALUE.
ARTICLE
IV
COVENANTS
4.1 Confidentiality.
Each
Party shall keep confidential, shall cause its Affiliates to keep confidential,
and shall instruct its officers, directors, employees and advisors to keep
confidential, (a) all Confidential Information regarding the Company to the
extent either Nevada Moly or POS-Minerals is required to keep such Confidential
Information confidential pursuant to Section 16.4 of the LLC Agreement, and
(b) any due diligence material and information received from any other Party
in
connection with the execution and delivery of this Agreement and the
consummation of the transactions provided for in this Agreement, pursuant to
the
Confidentiality Agreement, which due diligence material and information shall
remain subject to the terms and conditions of the Confidentiality Agreement
after the Closing.
CONTRIBUTION
AGREEMENT; Page 27
4.2 Expenses;
Transfer Taxes.
(a) General
Moly shall be liable for and pay all Taxes imposed by any Taxing Authority
arising out of, with respect to or in connection with the transfer, assignment
or conveyance to, or assumption by, the Company of the Contributed Assets or
the
Assumed Liabilities.
(b) POS-Minerals
shall be liable for and pay all Taxes imposed by any Taxing Authority arising
out of, with respect to or in connection with the POS-Minerals Initial
Contribution or the issuance to POS-Minerals of the Eureka POS LLC
Interest.
(c) Nevada
Moly shall be liable for and pay all Taxes imposed by any Taxing Authority
arising out of, with respect to or in connection with the assignment to Nevada
Moly of the Eureka GMO LLC Interest.
(d) Each
Party shall bear all attorneys’ fees and other costs incurred by such Party in
connection with the preparation, execution and delivery of the Transaction
Documents and the Closing.
4.3 Press
Releases and Public Announcements.
Neither
POS-Minerals nor its Affiliates, nor the GMO Parties nor their Affiliates,
nor
the Company nor its Affiliates, shall issue any press release or make any public
announcement relating to the subject matter of this Agreement without the prior
written approval of General Moly or POS-Minerals, respectively; provided,
that
any Party may make any public disclosure that it believes in good faith is
required by applicable Law or any listing or trading agreement concerning its
publicly traded securities or the publicly traded securities of any Affiliate
of
such Party in which the disclosing Party will use commercially reasonable
efforts to advise the other Parties before making such disclosure.
4.4 Further
Assurances.
At any
time or from time to time after the Closing, each Party shall execute and
deliver such other documents and instruments and take such other actions as
may
be necessary or advisable to carry out their respective obligations under this
Agreement and to evidence the consummation of the transactions provided for
herein, including the contribution of the Contributed Assets and the
POS-Minerals Initial Contribution to the Company, the assumption by the Company
of the Assumed Liabilities, the assignment to Nevada Moly of the Eureka GMO
LLC
Interest and the issuance to POS-Minerals of the Eureka POS LLC
Interest.
ARTICLE
V
INDEMNIFICATION
5.1 Survival
of Representations and Warranties.
The
respective representations and warranties of the Parties contained in this
Agreement or any certificate delivered pursuant to this Agreement shall survive
the Closing until 11:59 p.m., Denver, Colorado time, on September 30, 2009
(or,
in the case of the representations and warranties made in Section
3.1(o),
until
the applicable statute of limitations has expired),
provided,
that
the obligations to indemnify specified in Section
5.2
shall
not terminate at the time provided above if, before such time, a notice of
claim
relating to Losses specifying in detail the nature of such Losses (although
the
amount of Losses, if not yet determinable, need not be specified) has been
given
to the GMO Parties, the Company or POS-Minerals, as applicable. The covenants
of
the Parties in this Agreement shall survive the Closing without limitation
(except pursuant to their terms).
CONTRIBUTION
AGREEMENT; Page 28
5.2 Indemnification.
(a) Indemnification
for the Company’s Benefit.
(i) Subject
to the Company making a written claim for indemnification against the GMO
Parties pursuant to Section
5.3
within
the survival period set forth in Section
5.1,
the GMO
Parties shall jointly and severally indemnify and hold the Company harmless
from
and against any and all Losses the Company may suffer, arising out of, in the
nature of, incident or relating to, resulting from or caused by (A) the failure
of any representation or warranty of the GMO Parties set forth in Section 3.1
or
6.13
to be
true and correct in all material respects at and as of the Closing Date or
(B)
the breach by either of the GMO Parties of any of their respective covenants
under this Agreement in any material respect; provided,
that
the GMO Parties shall not have any obligation to indemnify the Company from
and
against any Losses the Company may suffer (including Losses suffered or paid,
directly or indirectly, through the application of the Company’s assets or
otherwise), arising out of, in the nature of, incident or relating to, resulting
from or caused by such failure or breach until the Company shall have suffered
Losses by reason of all such failures and breaches in excess of one percent
(1%)
of the Contributed Assets Value as of the Closing Date, after which point the
GMO Parties will be obligated only to indemnify the Company from and against
such further Losses.
(ii) Subject
to the Company making a written claim for indemnification against POS-Minerals
pursuant to Section
5.3
within
the survival period set forth in Section
5.1,
POS-Minerals shall indemnify and hold the Company harmless from and against
any
and all Losses the Company may suffer, arising out of, in the nature of,
incident or relating to, resulting from or caused by (A) the failure of any
representation or warranty of POS-Minerals set forth in Section
3.2
or
6.13
to be
true and correct in all material respects at and as of the Closing Date or
(B)
the breach by POS-Minerals of any of its covenants under this Agreement in
any
material respect provided,
that
POS-Minerals shall not have any obligation to indemnify the Company from and
against any Losses the Company may suffer (including Losses suffered or paid,
directly or indirectly, through the application of the Company’s assets or
otherwise), arising out of, in the nature of, incident or relating to, resulting
from or caused by such failure or breach until the Company shall have suffered
Losses by reason of all such failures and breaches in excess of one percent
(1%)
of the POS-Minerals Initial Contribution, after which point POS-Minerals will
be
obligated only to indemnify the Company from and against such further
Losses.
(b) Indemnification
for the Benefit of the GMO Parties.
Without
limiting any right or remedy of Nevada Moly under the LLC Agreement, subject
to
either of the GMO Parties making a written claim for indemnification against
POS-Minerals pursuant to Section
5.3
within
the survival period set forth in Section
5.1,
POS-Minerals shall indemnify and hold each of the GMO Parties harmless from
and
against any and all Losses that either of the GMO Parties may suffer, arising
out of, in the nature of, incident or relating to, resulting from or caused
by
(i) the failure of any representation or warranty of POS-Minerals set forth
in
Section
3.2
or
6.13
to be
true and correct in all material respects at and as of the Closing Date or
(ii)
the breach in any material respect by POS-Minerals of any of its covenants
under
this Agreement provided,
that
POS-Minerals shall have no obligation to indemnify the GMO Parties from and
against any Losses that they may suffer (including Losses suffered or paid,
directly or indirectly, through the application of their respective assets
or
otherwise), arising out of, in the nature of, incident or relating to, resulting
from or caused by such failure or breach until the GMO Parties shall have
suffered Losses by reason of all such failures and breaches in excess of one
percent (1%) of the POS-Minerals Initial Contribution, after which point
POS-Minerals will be obligated only to indemnify the GMO Parties from and
against such further Losses.
CONTRIBUTION
AGREEMENT; Page 29
(c) Indemnification
for the Benefit of POS-Minerals.
Without
limiting any right or remedy of either of POS-Minerals under the LLC Agreement,
subject to POS-Minerals making a written claim for indemnification against
the
GMO Parties pursuant to Section
5.3
within
the survival period set forth in Section
5.1,
the GMO
Parties shall jointly and severally indemnify and hold POS-Minerals harmless
from and against any and all Losses that POS-Minerals may suffer, arising out
of, in the nature of, incident or relating to, resulting from or caused by
(i)
the failure of any representation or warranty of the GMO Parties set forth
in
Section
3.1(a)
through
(i),
(o),
(p)
or
(q)
or
Section
6.13
to be
true and correct in all material respects at and as of the Closing Date or
(ii) the breach in any material respect by either of the GMO Parties of any
of their respective covenants under this Agreement; provided,
that
neither of the GMO Parties shall have no obligation to indemnify POS-Minerals
from and against any Losses that it may suffer (including Losses suffered or
paid, directly or indirectly, through the application of their respective assets
or otherwise), arising out of, in the nature of, incident or relating to,
resulting from or caused by such failure or breach until POS-Minerals shall
have
suffered Losses by reason of all such failures and breaches in excess of one
percent (1%) of the POS Minerals Initial Contribution, after which point the
GMO
Parties will be obligated only to indemnify POS-Minerals from and against such
further Losses.
(d) Without
limiting any of the rights and remedies of any Party under the LLC Agreement,
each Party hereby acknowledges and agrees that its sole and exclusive remedy
with respect to this Agreement, regardless of whether the relief demanded or
sought is found in contract or tort, shall be pursuant to the indemnification
provisions set forth in this Article
V.
In no
event shall any Party be liable to any other Party for such other Party’s (i)
lost profits, loss of use or lost revenues; (ii) diminution in value; (iii)
punitive, multiple or other exemplary damages; or (iv) any other indirect,
incidental, special or consequential Losses. Each Party waives and relinquishes
claims for such lost profits, loss of use, lost revenues, diminution in value,
punitive, multiple or other exemplary damages, other indirect, incidental
special or consequential Losses.
(e) Pursuant
to and consistent with Section
3.8(c)
of the
LLC Agreement, no Person other than a Member shall have the right to enforce
any
obligation of a Member to contribute capital, to fund Continuing Obligations
or
to reimburse any other Member under or pursuant to the LLC Agreement or
Article
II
of this
Agreement, and specifically no lender or other third party shall have any such
right, it being expressly understood that the capital contributions, Continuing
Obligations and reimbursement obligations of the Members under the LLC Agreement
or Article
II
of this
Agreement shall be enforceable only by a Member. For the avoidance of doubt,
(i)
Nevada Moly may enforce against POS-Minerals the obligation of POS-Minerals
under the Transaction Documents, including its obligation to make the
POS-Minerals Initial Contribution; (ii) either of the GMO Parties may enforce
against POSCAN the obligations of POSCAN under the POSCAN Guaranty; and (iii)
POS-Minerals may enforce against the GMO Parties (A) their respective
obligations under the Transaction Documents, including the obligations of
General Moly with respect to any Pending Approvals, and (B) the obligations
of
General Moly and the Company under the Conveyance Documents, in each case of
the
foregoing without the requirement to bring a derivative action or to otherwise
satisfy the requirements of Sections 18-1001 through 18-1004 of the Delaware
Limited Liability Company Act or other similar requirements
CONTRIBUTION
AGREEMENT; Page 30
5.3 Procedures.
(a) In
order
for an Indemnified Party to be entitled to any indemnification provided for
under this Agreement, such Indemnified Party shall, promptly following the
discovery of the matters giving rise to any Loss, notify the Indemnifying Party
in writing of such Indemnified Party’s claim for indemnification for such Loss,
specifying in reasonable detail the nature of such Loss and the amount of the
liability estimated to accrue therefrom; provided,
that
such Indemnified Party’s failure to so notify such Indemnifying Party shall not
release such Indemnifying Party, in whole or in part, from its obligations
under
this Article
V,
except
to the extent (and solely to the extent) that such Indemnifying Party will
have
been actually prejudiced as a result of such failure. Thereafter, such
Indemnified Party shall deliver to such Indemnifying Party, within five (5)
Business Days after such Indemnified Party’s receipt of such request, all
information and documentation reasonably requested by such Indemnifying Party
with respect to such Loss.
(b) If
any
third party notifies an Indemnified Party with respect to any matter, claim,
investigation, action, suit, charge, complaint, demand or other Legal
Proceeding, whether pending or threatened (an “Action”),
that
may give rise to a claim for indemnification under this Article
V,
then
such Indemnified Party shall promptly give notice of the Action to the
Indemnifying Party pursuant to Section
6.5;
provided,
however,
that
such Indemnified Party’s failure to so notify such Indemnifying Party of any
Action shall not release such Indemnifying Party, in whole or in part, from
its
obligations under this Article
V,
except
to the extent (and solely to the extent) that such Indemnified Party’s failure
to so notify actually prejudices such Indemnifying Party’s ability to defend
against such Action.
(c) An
Indemnified Party may, at the sole expense and liability of the Indemnifying
Party, exercise full control of the defense, compromise or settlement of any
such Action, unless, at any time within 30 days after such Indemnified Party
has
given notice to such Indemnifying Party of the Action, such Indemnifying Party
(i) delivers a written confirmation to such Indemnified Party that the
indemnification provisions of Section
5.2
are
applicable to such Action and that, subject to the other provisions of this
Article
V,
such
Indemnifying Party shall indemnify such Indemnified Party in respect of such
Action pursuant to the terms of Section
5.2,
(ii)
notifies such Indemnified Party in writing of such Indemnifying Party’s
intention to assume the defense thereof and thereafter conducts the defense
actively and diligently and (iii) retains legal counsel reasonably satisfactory
to such Indemnified Party to conduct the defense of such Action. Notwithstanding
anything to the contrary in the immediately preceding sentence, such
Indemnifying Party shall not have any right to assume the defense of such
Action, if (1) such Action seeks an injunction or other equitable relief and
not
money damages only, or (2) the settlement or compromise of, or an adverse
Judgment with respect to, such Action is, in the good faith judgment of such
Indemnified Party, likely to establish a precedent, custom or practice
materially adverse to the continuing business interests or the reputation of
such Indemnified Party.
CONTRIBUTION
AGREEMENT; Page 31
(d) The
Indemnified Party and the Indemnifying Party shall use their commercially
reasonable efforts to cooperate with the Party assuming the defense, compromise
or settlement of any such Action in accordance herewith in any manner that
such
Party reasonably may request. If such Indemnifying Party assumes the defense
of
any such Action, such Indemnified Party shall have the right to employ separate
counsel and to participate in (but not control) the defense, compromise or
settlement thereof, but the fees and expenses of such counsel shall be the
expense of such Indemnified Party unless (i) such Indemnifying Party has
specifically agreed to pay such fees and expenses or (ii) such Indemnified
Party
has been advised by its counsel that there may be one or more legal defenses
from claims available to it that are different from or additional to those
available to such Indemnifying Party or that there may be a conflict of interest
between such Indemnifying Party and such Indemnified Party in the conduct of
the
defense of such Action (in either of which cases such Indemnifying Party shall
not have the right to direct the defense, compromise or settlement of such
Action on behalf of such Indemnified Party), and in any such case the reasonable
fees and expenses of such separate counsel shall be borne by such Indemnifying
Party, it being understood and agreed, however, that such Indemnifying Party
shall not be liable for the fees and expenses of more than one separate firm
of
attorneys at any time for such Indemnified Party. No such Indemnified Party
shall settle or compromise or consent to entry of any Judgment with respect
to
any such Action for which it is entitled to indemnification hereunder without
the prior written consent of such Indemnifying Party, unless such Indemnifying
Party fails to assume control of such Action in the manner provided in
Section
5.3(c).
Such
Indemnifying Party shall not, without the written consent of such Indemnified
Party, settle or compromise or consent to entry of any Judgment with respect
to
any such Action (1) in which any relief other than the payment of money damages
is or may be sought against such Indemnified Party, or (2) that does not include
as an unconditional term thereof the giving by the claimant, party conducting
such investigation, plaintiff or petitioner to such Indemnified Party of a
release from all liability with respect to such Action.
5.4 Insurance
Proceeds.
Notwithstanding anything to the contrary in the other provisions of this
Article
V,
the
amount that an Indemnifying Party may be required to pay to an Indemnified
Party
pursuant to this Article
V
shall be
reduced (retroactively, if necessary) by any insurance proceeds or refunds
actually recovered by or on behalf of the applicable Indemnified Party in
reduction of the related Losses (on an after Tax basis). If any Indemnified
Party receives the payment required by this Article
V
from
such Indemnifying Party in respect of Losses and subsequently receives insurance
proceeds in respect of such Losses, then such Indemnified Party shall promptly
repay to such Indemnifying Party a sum equal to the amount of such insurance
proceeds or refunds actually received, net of costs and expenses and on an
after
Tax basis, but not exceeding the amount paid by such Indemnifying Party to
such
Indemnified Party in respect of such Losses. No representation, warranty,
covenant or agreement contained in this Agreement is for the benefit of any
insurer.
CONTRIBUTION
AGREEMENT; Page 32
5.5 Obligations
of General Moly and Nevada
Moly.
General
Moly shall be jointly and severally liable with Nevada Moly for all payment
and
performance obligations hereunder, which liability of General Moly shall be
as a
primary obligor and not as a secondary obligor or a surety. To the extent
required by Law for the Parties to enforce the obligations of General Moly
described in this Section
5.5,
each of
General Moly and Nevada Moly hereby waives (i) the right to require POS-Minerals
to proceed against Nevada Moly and (ii) presentment, demand for payment or
performance (including diligence in making demands hereunder), notice of
dishonor or nonperformance, protest, acceptance and notice of acceptance of
this
guarantee, and all other notices of any kind. The liability of General Moly
hereunder is independent of and not in consideration of or contingent upon
the
liability of Nevada Moly or any other Party and a separate action or actions
may
be brought and prosecuted against General Moly, whether any action is brought
or
prosecuted against Nevada Moly or any other Party or whether Nevada Moly or
any
other Party is joined in any such action or actions.
ARTICLE
VI
MISCELLANEOUS
6.1 Entire
Agreement; Successors and Assigns.
This
Agreement (together with the Schedules and Exhibits hereto) and the other
Transaction Documents contain, and are intended as, a complete statement of
all
of the terms of the agreements among the Parties with respect to the matters
provided for herein and therein, and supersede and discharge any previous
agreements and understandings between the Parties with respect to those matters.
This Agreement shall be binding upon and inure to the benefit of the respective
successors and permitted assigns of the Parties. In the event of any conflict
between this Agreement and any other Transaction Document, the terms of this
Agreement shall be controlling.
6.2 Governing
Law; Language.
This
Agreement shall be governed by and construed in accordance with the Laws of
the
State of Delaware, U.S. without regard to any choice or conflicts of law
provision or rule that would cause the application of the Laws of any
jurisdiction other than the State of Delaware. This Agreement has been
negotiated and executed by the Parties in English. In the event any translation
of this Agreement is prepared for convenience or any other purpose, the
provisions of the English version shall govern.
6.3 Resolution
of Disputes.
Except
as provided in Section
2.4
of this
Agreement or except as provided in any other Transaction Document with respect
to such other Transaction Document, any controversy, claim or dispute between
or
among two or more of the Parties (but excluding any controversy, claim or
dispute to which all of the parties thereto are any of the GMO Parties and
their
Affiliates or any controversy, claim or dispute to which all of the parties
thereto are any of POS-Minerals and its Affiliates) arising out of, relating
to
or in connection with this Agreement or any other Transaction Document shall
be
exclusively and finally settled pursuant to and in accordance with Article
XV of
the LLC Agreement; provided that any controversy, claim or dispute between
or
among such Parties that is referred to this Section 6.3
pursuant
to Section
2.4(c)
shall be
finally settled pursuant to and in accordance with Section 15.3
of the
LLC Agreement (without the necessity of conducting executive mediation pursuant
to Section
15.2
of the
LLC Agreement). Without limiting the generality of the foregoing, the following
shall be considered controversies, claims or disputes for this purpose: (a)
all
questions relating to the interpretation or breach of this Agreement or any
other Transaction Document, (b) all questions relating to any
representations, negotiations and other proceedings leading to the execution
hereof or thereof and (c) all questions as to whether the right to arbitrate
any
such question exists.
CONTRIBUTION
AGREEMENT; Page 33
6.4 Headings.
The
subject headings of the Articles, Sections and Subsections of this Agreement
and
the Paragraphs and Subparagraphs of the Exhibits and Schedules to this Agreement
are included for purposes of convenience only, and shall not affect the
construction or interpretation of any of its provisions.
6.5 Notices.
All
notices and other communications hereunder shall be in writing and shall be
delivered personally, telecopied (if receipt of which is confirmed by the Person
to whom sent), or sent by internationally recognized overnight delivery service
to the Parties at the following addresses (or to such other Person or address
for a Party as specified by such Party by like notice) (notice shall be deemed
given and received upon receipt, if delivered personally, by overnight delivery
service or by telecopy, or on the third Business Day following mailing, if
mailed, except that notice of a change of address shall not be deemed given
and
received until actually received):
(a) |
If
to General Moly or Nevada Moly, to it
at:
|
0000
Xxxx
Xxxx., Xxxxx 000
Xxxxxxxx,
XX 00000
Xxxxxx
Xxxxxx of America
303-928-8599
Attention:
Chief Executive Officer
Telecopier:
x0 (000) 000-0000
with
a
copy to:
Holme
Xxxxxxx & Xxxx LLP
0000
Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx,
Xxxxxxxx 00000
Xxxxxx
Xxxxxx of America
Attention:
Xxxxx Xxxxxxx, Esq.
Telecopier:
x0 (000) 000-0000
CONTRIBUTION
AGREEMENT; Page 34
(b) |
If
to POS-Minerals, to it at:
|
POS-Minerals
Corporation
PO
Box
11617
Suite
0000-000 X. Xxxxxxx Xxxxxx
Xxxxxxxxx
XX
Xxxxxx
X0X
0X0
Attention:
Xxxxxx-Kyun Xxx, President
Telecopier:
x0 (000) 000-0000
with
a
copy to:
Holland
& Xxxx
000
00xx
Xxxxxx, Xxxxx 0000
Xxxxxx,
Xxxxxxxx 00000
Xxxxxx
Xxxxxx of America
Attention:
Xxxxxx Xxxxxxx, Esq.
Telecopier:
x0 (000) 000-0000
(c) |
If
to the Company, to it at:
|
Eureka
Moly, LLC
c/o
General Moly, Inc.
0000
Xxxx
Xxxx., Xxxxx 000
Xxxxxxxx,
XX 00000
Xxxxxx
Xxxxxx of America
303-928-8599
Attention:
Chief Executive Officer of Manager
Telecopier:
x0 (000) 000-0000
with
a
copies to:
Holme
Xxxxxxx & Xxxx LLP
0000
Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx,
Xxxxxxxx 00000
Xxxxxx
Xxxxxx of America
Attention:
Xxxxx Xxxxxxx, Esq.
Telecopier:
x0 (000) 000-0000
CONTRIBUTION
AGREEMENT; Page 35
and
Holland
& Xxxx
555
17th
Street, Suite 3200
Xxxxxx,
Xxxxxxxx 00000
Xxxxxx
Xxxxxx of America
Attention:
Xxxxxx Xxxxxxx, Esq.
Telecopier:
x0 (000) 000-0000
6.6 Severability.
If at
any time any covenant or provision contained herein is deemed in a final ruling
of a court or other body of competent jurisdiction to be invalid or
unenforceable, such covenant or provision shall be considered divisible and
such
covenant or provision shall be deemed immediately amended and reformed to
include only such portion of such covenant or provision as such court or other
body has held to be valid and enforceable; and the Parties agree that such
covenant or provision, as so amended and reformed, shall be valid and binding
as
though the invalid or unenforceable portion had not been included
herein.
Amendment;
6.7 Waiver.
No
provision of this Agreement may be amended or modified except by an instrument
or instruments in writing signed by the Parties and designated as an amendment
or modification. No waiver by any Party of any provision of this Agreement
shall
be valid unless in writing and signed by the Party making such waiver and
designated as a waiver. No failure or delay by any Party in exercising any
right, power or remedy hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise thereof or the exercise of any other right,
power
or remedy preclude any further exercise thereof or the exercise of any other
right, power or remedy. No waiver of any provision hereof shall be construed
as
a waiver of any other provision.
6.8 Assignment
and Binding Effect.
No
Party may assign any of its rights or delegate any of its obligations under
this
Agreement without (a) the prior written consent of the other Parties, and (b)
the complete written assumption by the assignee of all of the obligations of
the
assignor under this Agreement. All of the terms and provisions of this Agreement
shall be binding on, and shall inure to the benefit of, the respective
successors and permitted assigns of the Parties.
6.9 No
Benefit to Others.
Except
as expressly set forth herein, the representations, warranties, covenants and
agreements contained in this Agreement are for the sole benefit of the Parties
and their respective successors and permitted assigns hereunder, and they shall
not be construed as conferring and are not intended to confer any rights,
remedies, obligations or liabilities on any other Person, unless such Person
is
expressly stated herein to be entitled to any such right, remedy, obligation
or
liability.
6.10 Counterparts.
This
Agreement may be executed by the Parties in separate counterparts, each of
which
when so executed and delivered shall be an original, but all such counterparts
shall together constitute one and the same instrument.
CONTRIBUTION
AGREEMENT; Page 36
6.11 Rules
of Construction.
The
Parties agree that they have been represented by counsel during the negotiation,
preparation and execution of this Agreement and, therefore, waive the
application of any Law or rule of construction providing that ambiguities in
an
agreement or other document shall be construed against the Party drafting such
agreement or document.
6.12 No
Partnership.
No
provision of this Agreement creates a partnership or joint venture between
or
among the Parties or makes any Party the agent of any other Party for any
purpose. No Party has the authority or power to bind, to contract in the name
of, or to create any liability for any other Party in any way or for any
purpose.
6.13 No
Sovereign Immunity.
Each
Party represents and warrants that it is subject to civil and commercial Law
with respect to its obligations under the Transaction Documents to which it
is a
party, that the making and performance of the Transaction Documents to which
it
is a party constitute private and commercial acts rather than governmental
or
public acts and that neither such Party nor any of its properties or revenues
has any right of immunity from suit, court, jurisdiction, attachment before
judgment, attachment in aid of execution of a judgment, set-off, execution
of a
judgment or from any other legal process with respect to its obligations under
the Transaction Documents. To the extent that a Party may hereafter be entitled,
in any jurisdiction in which any judicial proceedings or arbitrations may at
any
time be commenced with respect to the Transaction Documents to which it is
a
party, to claim for itself or its revenues or assets any such immunity, and
to
the extent that in any such jurisdiction there may be attributed to such Party
an immunity (whether or not claimed), such Party hereby irrevocably agrees
not
to claim and hereby irrevocably waives such immunity. The foregoing waiver
of
immunity shall have effect under the U.S. Foreign Sovereign Immunities Act
of
1976.
6.14 Legal
Relationships.
POS-Minerals
and POSCAN acknowledge and agree that Holme Xxxxxxx & Xxxx LLP and Hull
& Xxxxxxxxxxx Chartered have represented General Moly, Nevada Moly and their
respective Affiliates in connection with the Transaction Documents. In no event
shall an attorney-client relationship be deemed to exist between Holme Xxxxxxx
& Xxxx LLP or Hull & Xxxxxxxxxxx Chartered, on the one hand, and
POS-Minerals, POSCAN or any of their respective Affiliates, on the other hand.
General Moly and Nevada Moly acknowledge and agree that Holland & Xxxx LLP
has represented POS-Minerals, POSCAN and their respective Affiliates in
connection with the Transaction Documents. In no event shall an attorney-client
relationship be deemed to exist between Holland & Xxxx LLP, on the one hand,
and General Moly, Nevada Moly or any of their respective Affiliates, on the
other hand. The Parties agree and irrevocably consent that Holme Xxxxxxx &
Xxxx LLP’s, Hull & Xxxxxxxxxxx Chartered’s and Holland & Xxxx LLP’s
respective attorney-client relationships with the Persons described in this
Section
6.14
shall
not disqualify any of such firms from providing legal advice and legal services
to the Company upon request in matters related or unrelated to any of this
Agreement and the other Transaction Documents or otherwise, and that such firms’
attorney-client relationship with the Company, if any, shall not disqualify
such
firm from providing legal advice and legal services to any such Persons in
matters related or unrelated to any of this Agreement and the other Transaction
Documents or otherwise; provided,
that
(a) in the case of a dispute between the Members or between the Company and
any
Member, nothing in this Section
6.14
shall
excuse the obligations of a lawyer or any law firm to act consistent with
applicable standards of professional conduct, and (b) for the avoidance of
doubt, in any dispute between one or more Members, on the one hand, and the
Company, on the other hand, none of the foregoing law firms shall represent
both
a Member and the Company in such dispute.
[Signatures
on Next Page]
CONTRIBUTION
AGREEMENT; Page 37
Exhibit
10.20
Execution
Version
The
Parties have executed this Agreement as of date first set forth above, to be
effective as of the date first above written.
a
Delaware corporation
|
|
By:
|
/s/
Xxxxx X. Xxxxxx
|
Name:
|
Xxxxx
X. Xxxxxx
|
Title:
|
Chief
Executive Officer
|
NEVADA
MOLY, LLC,
|
|
a
Delaware limited liability company
|
|
By:
|
/s/
Xxxxx X. Xxxxxx
|
Name:
|
Xxxxx
X. Xxxxxx
|
Title:
|
Chief
Executive Officer
|
a
Delaware limited liability company
|
|
By:
|
NEVADA
MOLY, LLC,
|
a
Delaware limited liability company, its manager
|
|
By:
|
/s/
Xxxxx X. Xxxxxx
|
Name:
|
Xxxxx
X. Xxxxxx
|
Title:
|
Chief
Executive Officer
|
POS-MINERALS
CORPORATION,
|
|
a
Delaware corporation
|
|
/s/
Xxxxxx-Kyun Xxx
|
|
Name:
|
Xxxxxx-Kyun
Xxx
|
Title:
|
President
and Secretary
|
CONTRIBUTION
AGREEMENT; SIGNATURE PAGE
EXHIBIT
F
EXAMPLE
CALCULATION OF PRE-CLOSING DATE PAYMENT AMOUNT
Pre-Closing
Date Payment Amount = 20% × (EUA – PTBA)
where
EUA
= ((07BE – 07AE) – 08PE)
and
where
PTBA = (EUA × (30% × DP))
PTBA
=
Underfunded Payment Net Tax Benefit Amount
EUA
=
Excess Underfunded Amount
07BE
=
2007 Budgeted Expenditures ($33,859,000)
07AE
=
Actual 2007 Expenditures (costs incurred in 2007)
08PE
=
2008 Pre-Closing Expenditures (i.e. costs that are paid in 2008 before
Closing)
DP
=
Deduction Percentage (i.e. percentage of 08PE that are deductible)
For
example, if
07BE
=
$33,859,000
07AE
=
$13,300,000
08PE
=
$12,000,000
DP
=
70%
then:
EUA
=
($33,859,000 – $13,300,000) – $12,000,000) = $8,559,000
PTBA
=
($8,559,000 × (30% × 70%)) = $1,797,390
Pre-Closing
Date Payment Amount = 20% × ($8,559,000 – $1,797,390) =
$1,352,322
EXHIBIT
F
TO CONTRIBUTION AGREEMENT
EXAMPLE
CALCULATION OF PRE-CLOSING DATE PAYMENT AMOUNT