AMENDMENT NO. 1 TO THE SHARE PURCHASE AGREEMENT
AMENDMENT
NO. 1 TO THE SHARE PURCHASE AGREEMENT
AMENDMENT
NO. 1 (this “Amendment”), dated as of
December 31, 2010, to the Share Purchase Agreement dated as of November 30, 2010
(the “SPA”) among
N.C.G.A. Project Acquisition Corp., a Cayman Islands corporation (the "Buyer"), and TWL Investments
Ltd., Xxxxx Xxxxxxx Xxxxxx and Xxxxxx Xxxx Xxxxxx (collectively, the "Sellers") and Xxxxxx Xxxxxxx
Xxxxx. Capitalized terms used but not defined herein shall have the meaning
assigned to such term in the SPA.
WHEREAS,
the parties hereto entered into the SPA on November 30, 2010, which remains in
full force and effect as of the date hereof;
WHEREAS,
the parties to the SPA desire to extend certain dates contained in the SPA and
to amend the SPA on and subject to the terms and conditions as set forth herein;
and
WHEREAS,
Section 10.4(a) of the SPA permits amendments to the SPA by instruments in
writing signed by each party to the SPA.
NOW,
THEREFORE, for good and valuable consideration, the receipt of which is hereby
acknowledged, the parties to the SPA hereby agree as follows:
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1.
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Upon
the execution and delivery of this Amendment, and as a condition precedent
to the effectiveness of this Amendment, the Buyer or its designee on its
behalf shall pay to the Sellers or as they may direct a non-refundable
extension fee in immediately available funds in the amount of $125,000,
and upon the Closing, the Buyer shall pay to the Sellers or as they may
direct an additional extension fee of $125,000, which, for greater
certainty, neither amount shall be credited against the Purchase
Price.
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2.
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The
following shall be added as Section 10.18 to the
SPA:
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"10.18
Deferred Consideration
Payment. Concurrently with the Closing, Buyer shall cause
HemcoNic to grant to Sellers or an entity as directed by them a right to receive
a deferred consideration payment (the “Deferred Payment Right”) upon
the terms and conditions set forth in this Section 10.18 on the HemcoNic
Non-Mine Concessions (as defined in this Section 10.18 below). The
Deferred Payment Right shall be equal to the payment of $1.00, net of taxes
other than taxes on gross or net income or gains, for each ounce of gold
(without duplication) established in any category of resource (other than an
inferred resource) or reserve in the HemcoNic Non-Mine Concession measured in
compliance with National Instrument 43-101 of the Canadian Securities
Administrators or any successor legislation ("NI 43-101"); provided that the
aggregate payments payable pursuant to the Deferred Payment Right shall in no
event exceed Five Million Dollars ($5,000,000) (the “Deferred Payment
Cap”). Buyer shall cause the Deferred Payment Right to be
registered on title to the HemcoNic Non-Mine Concessions and the holder of the
HemcoNic Non-Mine Concessions shall be required to obtain annually a NI 43-101
compliant resource report prepared by an independent internationally recognized
geological consulting firm in relation to the HemcoNic Non-Mine Concessions as
of December 31 in each year and to provide a copy thereof to the Deferred
Payment Right holder promptly following receipt and in no event later than March
31 in each year. To the extent that any such report discloses aggregate gold
resources (other than inferred resources) and reserves in the HemcoNic Non-Mine
Concessions in excess of the amounts disclosed in any prior NI 43-101 compliant
report (the “Excess Gold
Amounts”), the holder of the HemcoNic Non-Mine Concessions
shall pay to the Deferred Payment Right holder within 30 days of receipt of such
subsequent report, $1.00, net of taxes other than taxes on gross or net income
or gains, for each ounce of Excess Gold Amounts subject to the Deferred Payment
Cap. For purposes of this Section 10.18, “HemcoNic Non-Mine Concessions”
means the Mining Concessions owned by HemcoNic as of the date of the Closing
plus the concessions owned by Minerales Matuzalen, S.A., all as set out in items
2 to 25 of Schedule
3.14(a) of the SPA, plus four properties HemcoNic has under application
known as Lote HEMCO RB I, Lote HEMCO Bonanza II, Lote HEMCO Xxxxxx I and Lote
HEMCO Xxxxxx XX but
excluding the Bonanza lot granted through Ministerial Decree
018-RN-MC-1994 and known as the "Bonanza concession" that contains the Bonanza
mine (and set out in item 1 of Schedule 3.14(a) of
the SPA)."
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3.
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The
following shall be added as Section 10.19 to the
SPA:
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"10.19
Additional
Director. Buyer shall cause Xxxxxx to be appointed as a
director and Non-executive Chairman of Universal Gold Mining Corp with effect
from (and subject to) the Closing."
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4.
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The
following shall be added as Section 6.6 to the
SPA:
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"6.6 Financing Updates.
From January 1, 2011 to the earlier of the date of the Closing or termination of
this Agreement, Buyer shall provide Sellers with weekly written updates on its
progress in satisfying the financing condition specified in Section 7.2(g) of
this Agreement.”
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5.
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The
following shall be added as Section 6.7 to the
SPA:
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“6.7 Form of Closing
Documentation. The parties shall do all acts and things to
settle the form of all documentation required for the Closing and sign all
documentation (conditional and commencing on the Closing) on or prior to January
31, 2011.”
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6.
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The
following shall be added as Section 6.8 to the
SPA:
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“6.8 Meetings with Governmental
Entities. Sellers shall and shall cause its Affiliates to
arrange and otherwise facilitate prior to the Closing for Xxxxxx Xxxxx, director
of Universal Gold Mining Corp., as the representative of Buyer, to meet with the
Mines Director of the Government of Nicaragua for the purpose of introducing to
the Mines Director the Buyer and Universal Gold Mining Corp. as prospective
acquirers of the Nicaraguan Companies and the proposed change of control of the
Nicaraguan Companies contemplated by this Agreement and Universal Gold Mining
Corp.’s development plans for the Nicaraguan Companies and obtaining all
relevant confirmations required by Section 6.1 of this Agreement.”
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7.
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Section
8.2 of the SPA shall be deleted and replaced by the
following:
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"8.2
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Effect
of Termination. In the event of termination of this
Agreement as provided in Section 8.1, this Agreement shall immediately
become null and void and there shall be no liability or obligation on the
part of Buyer or Sellers or their respective officers, directors,
stockholders or Affiliates (including Universal Gold Mining Corp.) except
as set forth in Section 8.3; provided that the
provisions of Section 6.2 (Public Announcements), Section 8.3 (Remedies)
and ARTICLE X (excluding Sections 10.12(b), 10.18 and 10.19) of this
Agreement shall remain in full force and effect and survive any
termination of this Agreement."
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8.
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Section
8.3 of the SPA shall be deleted and replaced by the
following:
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"8.3
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Remedies. Any
party terminating this Agreement pursuant to Section 8.1 shall have the
right to recover damages sustained by such party as a result of any breach
by the other party of any representation, warranty, covenant or agreement
contained in this Agreement or fraud or willful misrepresentation; provided, however, that
Buyer shall not be entitled to recover damages pursuant to this Section
8.3 in the event that it has not satisfied or waived the condition set
forth in Section 7.2(g) and provided written notice of such satisfaction
or waiver to Sellers, unless such non-fulfillment is solely due to, arises
out of or is in connection with any fraud, intentional breach of the
covenants contained in Section 8.4 or intentional misrepresentation by any
of Sellers, in which event the maximum damages recoverable by the Buyer
shall be limited to Two Million Dollars ($2,000,000); provided further,
however, that the party seeking relief is not in breach of any
representation, warranty, covenant or agreement contained in this
Agreement under circumstances which would have permitted the other party
to terminate the Agreement under Section
8.1.”
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9.
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In
the event that the purchase and sale transaction contemplated by the SPA
is terminated, the Buyer covenants and agrees that it shall forthwith
provide the Sellers with copies of all due diligence materials, reports
and data prepared or compiled in connection with its proposed purchase and
review thereof and this covenant shall survive any such termination. The
Buyer shall not be obligated to provide under this Section 9 (i) materials
covered by solicitor and client privilege and (ii) materials prepared by
third parties whose consent is required but who have not provided such
consent, provided that the Buyer has used reasonable commercial efforts to
obtain the consent of such third parties. Each Seller will, and will cause
its Affiliates to execute and deliver any further confidentiality
agreements requested by such third parties prior to release of the
relevant information, and to hold, and will use its reasonable best
efforts to cause its and their respective Representatives to hold, in
confidence any and all such information, whether written or oral, except
to the extent that such Seller can show that such information (i) is in
the public domain through no fault of any Seller or any of its Affiliates
(ii) is lawfully acquired by such Seller or any of its Affiliates from
sources which are not prohibited from disclosing such information by a
legal, contractual or fiduciary obligation or (iii) which a Seller or any
of its Affiliates or Representatives is compelled to disclose by judicial
or administrative process or by other requirements of
Law.
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10.
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Each
reference to the date “December 31, 2010” contained in Sections 2.3(ii),
8.1(a)(ii)(A) and 8.4 in the SPA is hereby deleted and replaced with
“February 15, 2011.”
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11.
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This
Amendment shall be governed by and interpreted and enforced in accordance
with the laws of the State of New York, without giving effect to any
choice of law or conflict of laws rules or provisions (whether of the
State of New York or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of New
York.
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12.
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Except
as expressly modified by this Amendment, all of the terms and conditions
of the SPA shall remain in full force and effect. In the event
of a conflict between the terms of the SPA and this Amendment, the
provisions of this Amendment shall prevail. This Amendment may
be executed in counterparts, and any party hereto may execute any such
counterpart, each of which when executed and delivered shall be deemed to
be an original and all of which counterparts taken together shall
constitute but one and the same instrument. This Amendment shall become
effective when each party hereto shall have received a counterpart hereof
signed by the other parties hereto. The parties agree that the
delivery of this Amendment may be affected by means of an exchange of
electronic or facsimile signatures.
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[Signature
page follows immediately]
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IN
WITNESS WHEREOF, each party hereto has caused this Amendment to be duly executed
by its duly authorized officer or representative as of the date first above
written.
| N.C.G.A. PROJECT ACQUISITION CORP. | ||||
| By: Gottbetter & Partners, LLP, in Trust, as Sole Shareholder | ||||
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By:
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/s/ Xxxx X. Xxxxxxxxxx | ||
| Name: Xxxx X. Xxxxxxxxxx | ||||
| Title: Partner | ||||
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TWL
INVESTMENTS LTD.
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| By: | /s/ X.X. Xxxxx | |||
| Name: X. X. Xxxxx | ||||
| Title: President | ||||
| /s/ Xxxxx Xxxxxxx Xxxxxx | ||||
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Xxxxx
Xxxxxxx Xxxxxx
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| /s/ Xxxxxx Xxxx Xxxxxx | ||||
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Xxxxxx
Xxxx Xxxxxx
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| /s/ Xxxxxx Xxxxxxx Xxxxx | ||||
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Xxxxxx
Xxxxxxx Xxxxx
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