Exhibit 1
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SHAREHOLDER AGREEMENT
By and Between
ASARCO INCORPORATED
and
COEUR D'XXXXX XXXXX CORPORATION
Dated as of September 9, 1999
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TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS..............................................................2
Section 1.1 Definitions.................................................2
ARTICLE II
NOMINATION AND ELECTION OF DIRECTORS.....................................4
Section 2.1 Nomination of Directors by Asarco...........................4
Section 2.2 Solicitation of Proxies by the Corporation..................4
Section 2.3 Agreement to Vote for Slate of Directors....................4
ARTICLE III
STANDSTILL...............................................................5
Section 3.1 Standstill..................................................5
ARTICLE IV
REGISTRATION RIGHTS......................................................5
Section 4.1 No Registration...............................................5
Section 4.2 Demand Registration...........................................5
Section 4.3 Piggyback Registration........................................5
Section 4.4 Costs and Expenses............................................6
Section 4.5 Prospectuses, Qualification and Indemnity.....................6
Section 4.6 Asarco's Information and Indemnification......................7
ARTICLE V
CERTAIN CORPORATE ACTIONS................................................7
Section 5.1 Certain Corporate Actions...................................7
ARTICLE VI
MISCELLANEOUS............................................................8
Section 6.1 Expenses....................................................8
Section 6.2 Governing Law...............................................8
Section 6.3 Jurisdiction................................................8
Section 6.4 Injunctive Relief...........................................8
Section 6.5 Captions....................................................8
Section 6.6 Publicity...................................................8
Section 6.7 Notices.....................................................8
Section 6.8 Parties in Interest.........................................9
Section 6.9 Counterparts................................................9
Section 6.10 Entire Agreement...........................................9
Section 6.11 Amendments.................................................9
Section 6.12 Severability...............................................9
Section 6.13 Third Party Beneficiaries..................................9
SHAREHOLDER AGREEMENT
SHAREHOLDER AGREEMENT (this "Agreement") dated September 9, 1999 by
and between ASARCO INCORPORATED, a New Jersey corporation ("Asarco"), and COEUR
D'XXXXX XXXXX CORPORATION, an Idaho Corporation ("Coeur").
W I T N E S S E T H :
WHEREAS, Asarco and Coeur have completed the transactions
contemplated by a Transaction Agreement dated as of May 13, 1999 amended and
restated as of June 22, 1999 (the "Transaction Agreement") providing for the
exchange of certain assets of Asarco for 7,125,000 shares of newly issued common
stock, par value $1.00 per share (the "Common Stock"), of Coeur pursuant to the
terms and conditions of the Transaction Agreement;
WHEREAS, the Parties hereto believe that it is desirable for Asarco
and Coeur to make certain agreements with respect to the shares of Common Stock
to be owned by Asarco.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained and for other good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Definitions. As used in this Agreement, the following
capitalized terms shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):
"Action of Asarco" shall mean any voluntary sale, transfer or other
disposition of beneficial ownership of Common Stock by Asarco and its
Affiliates, either directly or indirectly, to any Person other than Asarco or
its Affiliates; provided, however, the term "Action of Asarco" shall not include
any sale, transfer or other disposition of beneficial ownership pursuant to any
order, decree or directive of any court or other governmental body or by any
public authority or otherwise by operation of law.
"Affiliate" of any Person shall mean any Person directly or
indirectly controlling, controlled by, or under common control with, such
person; provided that, for the purposes of this definition, "control"
(including, with correlative meanings, the terms "controlled by" and "under
common control with"), as used with respect to any Person, shall mean the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities or partnership interests, by contract or
otherwise.
"Agreement" shall have the meaning assigned to such term in the
preamble to this Agreement.
"Asarco" shall have the meaning assigned to such term in the
preamble to this Agreement.
"Business Day" shall mean any day, other than a Saturday, Sunday or
a day on which banks located in New York, New York shall be authorized or
required by law to close.
"Closing Date" shall have the meaning assigned to such term in the
Transaction Agreement.
"Common Stock" shall have the meaning assigned to such term in the
first recital of this Agreement.
"Coeur" shall have the meaning assigned to such term in the preamble
to this Agreement.
"Liens" shall mean liens, security interests, options, rights of
first refusal, easements, mortgages, charges, indentures, deeds of trust, rights
of way, restrictions on the use of real property, encroachments, licenses to
third parties, leases to third parties, security agreements, or any other
encumbrances and other restrictions or limitations on use of real or personal
property or irregularities in title thereto.
"1933 Act" shall mean the Securities Act of 1933, as amended,
together with the rules and regulations promulgated thereunder.
"1934 Act" shall mean the Securities Exchange Act of 1934, as
amended, together with the rules and regulations promulgated thereunder.
"Parties" shall mean Asarco and Coeur and their respective
successors and permitted assigns.
"Person" shall mean and include an individual, a partnership, a
joint venture, a corporation, a limited liability company, a limited liability
partnership, a trust, an incorporated organization and a government or any
department or agency thereof.
"Registrable Stock" shall mean: (i) any of the Common Stock owned by
Asarco or its Affiliates; and (ii) any securities issued or issuable with
respect to such Common Stock referred to in clause (i) above by way of stock
dividends or stock splits or in connection with a combination of shares,
recapitalization, merger, consolidation, or other reorganization or otherwise.
As to any particular Registrable Stock, such securities will cease to be
Registrable Stock when they have been distributed to the public pursuant to an
offering registered under the 1933 Act. The foregoing notwithstanding, a
security will not cease to be Registrable Stock until all stop transfer
instructions or notations and restrictive legends with respect to such security
have been lifted or removed.
"Registration Statement" means any registration statement under the
1933 Act of Coeur that covers any of the Registrable Stock pursuant to the
provisions of this Agreement, including the related prospectus, all amendments
and supplements to such registration statement, including pre- and
post-effective amendments, all exhibits thereto and all material incorporated by
reference or deemed to be incorporated by reference in such registration
statement.
"SEC" shall mean the United States Securities and Exchange
Commission.
"Subsidiary" shall mean any other Person in which a Person owns,
directly or indirectly, 50% or more of the outstanding shares of capital stock
or other equity interests.
"Transaction Agreement" shall have the meaning assigned to such term
in the first recital of this Agreement.
ARTICLE II
NOMINATION AND ELECTION OF DIRECTORS
Section 2.1 Nomination of Directors by Asarco. Asarco shall have the
right to nominate, by written notice to Coeur, two directors for election to
Coeur's board of directors. In the event that Asarco and its Affiliates shall
hold less than 10% of the total outstanding Common Stock due to an Action of
Asarco, Asarco shall have the right to nominate, by written notice to Coeur, one
director for election to Coeur's board of directors. In each case, written
notice of nomination shall be provided by Asarco to Coeur 20 Business Days
following receipt by Asarco of a written request for nomination from Coeur which
request shall be made not later than 30 Business Days prior to the record date
for determining shareholders entitled to vote at any annual or special meeting
at which directors will be elected. Asarco and Coeur agree that Asarco's initial
nominees shall be appointed to Coeur's board of directors on the Closing Date,
which is the date on which this Agreement is executed, and that such nominees
will be the persons specified in a written notice from Asarco to Coeur delivered
on the date the Transaction Agreement was executed. Asarco's rights under this
Section 2.1 and Coeur's obligations under Section 2.2 shall continue for so long
as Asarco and its Affiliates own at least 1% of outstanding Common Stock.
Section 2.2 Solicitation of Proxies by Coeur. Coeur shall take all
reasonable and lawful action to solicit proxies from its shareholders pursuant
to proxy materials for the election of directors of Coeur, including the
directors or director nominated by Asarco, and which recommend that Coeur's
shareholders vote in favor of such slate of directors, including the directors
or director nominated by Asarco.
Section 2.3 Agreement to Vote for Slate of Directors. Provided that
Coeur shall have complied with Sections 2.1 and 2.2 hereof, Asarco shall vote,
and shall cause each of its Affiliates to vote, all of their respective shares
of Common Stock for the election of the slate of directors recommended by the
board of directors of Coeur at any annual or special meeting called for such
purpose.
ARTICLE III
STANDSTILL
Section 3.1 Standstill. Asarco agrees that, for a period of five
years from the Closing Date, unless Asarco first obtains the written consent of
Coeur's board of directors, it shall not, directly or indirectly, acquire Common
Stock or other voting equity securities of Coeur, or any right or option to
acquire Common Stock or other voting equity securities of Coeur if, after such
acquisition, Asarco and its Affiliates, directly or indirectly, would
beneficially own more than 25% of the total combined voting power of all voting
equity securities of Coeur.
ARTICLE IV
REGISTRATION RIGHTS
Section 4.1 Demand Registration. At any time and from time to time
after the Closing Date, upon the request of Asarco for a registration of at
least 1,000,000 shares of Registrable Stock, Coeur will use all reasonable
efforts to file the necessary Registration Statement under the 1933 Act and
cause it to become effective within 90 days from the date of Asarco's request.
Such registration Statement shall cover the Common Stock which Coeur has been so
requested to register for disposition in accordance with the intended method or
methods of disposition stated in such request.
Section 4.2 Piggyback Registration. Whenever Coeur proposes to
register any of its equity securities under the 1933 Act (other than for an
acquisition of the type described in Rule 145 under the 1933 Act or for an
employee benefit plan on Form S-8), whether or not for sale for its own account,
Coeur will each time give prompt written confidential notice of such proposed
filing to Asarco at least 20 Business Days before the anticipated filing date.
Such notice shall offer Asarco and its Affiliates the opportunity to register
such amount of Registrable Stock as they shall request (a "Piggyback
Registration"). Coeur shall include in each such Piggyback Registration all
Registrable Stock with respect to which Coeur has received a written request for
inclusion therein within 15 Business Days after such notice has been given by
Coeur to Asarco. If the Registration Statement relating to the Piggyback
Registration is to cover an underwritten offering, such Registrable Stock shall
be included in the underwriting on the same terms and conditions as the
securities otherwise being sold through the underwriters. Asarco and its
Affiliates shall be permitted to withdraw all or part of the Registrable Stock
from a Piggyback Registration at any time prior to the effective time of such
Piggyback Registration.
Section 4.3 Costs and Expenses. All costs, expenses and fees, other
than the fees of Asarco's counsel, with respect to a Registration Statement
filed by Coeur pursuant to Section 4.1 hereof shall be borne by Coeur. The
costs, expenses and fees, other than the fees of Asarco's counsel, with respect
to any Registration Statement filed by Coeur pursuant to Section 4.2 hereof
shall be borne by Coeur and by the holders of securities requesting registration
of their securities pro rata in proportion to the offering price of the
securities being sold by each, but allocable expenses shall not include the fees
and disbursements of any independent counsel retained by such holders in
connection therewith. The out-of-pocket expenses borne by such holders shall be
allocated among them in proportion to the offering price of the securities
respectively requested by them to be registered under the 1933 Act, except that
such expenses incurred at the request of particular holders, the benefits of
which are not shared directly by all such holders, shall be borne by such
particular holders. Asarco shall bear its own underwriting discounts and
commissions.
Section 4.4 Prospectuses, Qualification and Indemnity. In the event
of the registration of any Common Stock which Asarco or its Affiliates propose
to sell or otherwise dispose of, Coeur will:
(a) Furnish to Asarco or its Affiliates such number of copies of a
prospectus in conformity with the requirements of the 1933 Act and such
other documents as Asarco or its Affiliates shall reasonably request;
(b) Use its best efforts to register or qualify, if required, such
Common Stock under such other securities acts or blue sky laws of such
jurisdiction as Asarco or its Affiliates shall reasonably request and do
any and all other acts and things which may be necessary or advisable to
enable Asarco or its Affiliates to consummate such proposed sale or other
disposition of such Common Stock in any jurisdiction;
(c) Keep effective all such registrations and qualifications and do
any and all such other acts and things for such period as may be necessary
to permit the public sale or other disposition of such Common Stock by
Asarco or its Affiliates; and
(d) Indemnify Asarco, its Affiliates, and their respective directors
and officers against, and to the extent indemnification is unavailable or
insufficient, contribute to the payment of, any liability or expense which
any of them may incur incident to such registration, qualification and
public sale or other disposition of the Common Stock by reason of any
untrue statement of a material fact in any prospectus, Registration
Statement, offering circular or in any related documents or the like, or
any omission of any material fact required to be stated therein or
necessary to make the statements therein not misleading, or any
manipulative or deceptive device or contrivance or fraudulent scheme or
practice by Coeur, provided that Coeur shall not be liable to Asarco, its
Affiliates or their respective directors and officers in respect of any
liability arising out of an untrue statement or omission made in reliance
upon or in conformity with written information furnished to Coeur by
Asarco or its Affiliates or by an underwriter specifically for use in
connection with any such registration or qualification.
Section 4.5 Asarco's Information and Indemnification. At the request
of Coeur, Asarco will furnish to Coeur such information regarding itself and its
holdings of Common Stock as Coeur shall specify in such request and as shall be
required in connection with any action taken pursuant to this Article IV and
Asarco shall indemnify Coeur in respect of any liability arising out of any
untrue statement or omission made in reliance upon or in conformity with such
information.
ARTICLE V
CERTAIN CORPORATE ACTIONS
Section 5.1 Certain Corporate Actions. Until Asarco and its
Affiliates hold less than 10% of the total outstanding Common Stock as a result
of an Action of Asarco, the following actions shall not be taken by Coeur
without the prior written consent of Asarco:
(i) approval of capital expenditure budgets and any single project
requiring a capital expenditure in excess of $100,000,000;
(ii) approval of any financial institution, terms and conditions and
amounts with respect to any standard lines of credit or borrowings to be
utilized or secured by Coeur exceeding $100,000,000;
(iii) the creation of any Lien in excess of $100,000,000 on the
assets of Coeur or any of its Subsidiaries;
(iv) the discharge of auditors when a material dispute exists in
connection with the auditing of Coeur's books, records or financial statements;
(v) the liquidation, dissolution or general winding-up of Coeur or
any material Subsidiary or the filing on behalf of Coeur or any material
Subsidiary of any voluntary petition seeking relief under the bankruptcy laws of
the relevant jurisdiction;
(vi) any material change in the nature of Coeur's business from its
current business of precious metals mining and other businesses directly related
thereto;
(vii) the issuance by Coeur of any Common Stock or other class of
its capital stock for consideration other than cash for a value in excess of
$100,000,000;
(viii) any material amendment of the By-Laws or Articles of
Incorporation of Coeur which would conflict with, or in any way be inconsistent
with, the terms of this Agreement; and
(ix) any increase in the number of directors of Coeur above eleven.
Notwithstanding the foregoing, no consent of Asarco shall be
required for a currently-contemplated debt restructuring plan of Coeur provided
it consists of changes in the terms of Coeur's outstanding convertible
subordinated debentures due 2002, 2004, and 2005 including extensions of
maturity dates, repurchases, increases in interest rates (but not to a level
higher than current market rates for comparably-rated debt) and reductions in
conversion prices (but not to a level lower than 10% above the then-current
market price of the Coeur Common Stock), or an exchange of equity securities for
debt provided that the implied value of any Common Stock involved in such an
exchange shall not be less than the then-current market price of the Common
Stock.
Section 5.2 Deemed Consent. Asarco shall be deemed to have consented
to an action specified in Section 5.1 if (i) such action shall have been
included as a specific agenda item for a meeting of Coeur's Board of Directors,
(ii) such written agenda together with all relevant information relating to the
proposed action shall have been delivered to Directors at least three Business
Days prior to such meeting and (iii) at such meeting of Coeur's Board of
Directors, both of the Directors nominated by Asarco pursuant to Section 2.1
vote in favor of such action.
ARTICLE VI
MISCELLANEOUS
Section 6.1 Expenses. Except as otherwise provided in Article IV and
in Section 6.3 each of the Parties hereto shall pay all of its own expenses
relating to its performance under, and the transactions contemplated by, this
Agreement, including, without limitation, the fees and expenses of its
respective legal, financial, accounting and other advisers.
Section 6.2 Governing Law. The interpretation and construction of
this Agreement, and all matters relating hereto, shall be governed by the laws
of the State of New York applicable to agreements executed and to be performed
solely within such State.
Section 6.3 Jurisdiction. Any judicial proceeding brought against
either Party to this Agreement on any dispute arising out of this Agreement or
any matter related hereto may be brought in the courts of the State of New York,
or in the United States District Court for the Southern District of New York,
and, by execution and delivery of this Agreement, each of the Parties to this
Agreement accepts the non-exclusive jurisdiction of such courts, and irrevocably
agrees to be bound by any judgment rendered thereby in connection with this
Agreement. The prevailing Party in any such litigation shall be entitled to
receive from the losing Party all costs and expenses, including reasonable
counsel fees, incurred by the prevailing Party.
Section 6.4 Injunctive Relief. It is acknowledged that it may be
impossible to measure in money the damages that would be suffered if either
Party hereto fails to comply with any of the obligations herein imposed on it
and that, in the event of any such failure, an aggrieved Party hereto may be
deemed to have been irreparably damaged and may not have an adequate remedy at
law. Any such Party shall, therefore, be entitled to injunctive relief,
including specific performance, to enforce such obligations.
Section 6.5 Captions. The Article and Section captions used herein
are for reference purposes only, and shall not in any way affect the meaning or
interpretation of this Agreement.
Section 6.6 Publicity. Asarco and Coeur agree that each Party shall,
subject to its respective legal obligations (including requirements of stock
exchanges and other similar regulatory bodies), consult with the other, and use
reasonable efforts to agree upon the text of any press release, before issuing
any such press release or otherwise making public statements with respect to the
transactions contemplated hereby and in making any filings with any federal or
state governmental or regulatory agency or with any national securities exchange
with respect thereto.
Section 6.7 Notices. Any notice or other communication required or
permitted under this Agreement shall be sufficiently given if delivered in
person or sent by facsimile or by registered or certified mail, postage prepaid,
addressed as follows: if to Asarco, to 000 Xxxxxx Xxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: General Counsel; and if to Coeur, to 000 Xxxxx Xxxxxx, X.X.
Xxx X, Xxxxx x'Xxxxx, Xxxxx 00000-0000, Attention: Xxxxxx X. Xxxxxxx or such
other address or number as shall be furnished in writing by any such Party, and
such notice or communication shall be deemed to have been given as of the date
so delivered, sent by facsimile or mailed.
Section 6.8 Parties in Interest. This Agreement may not be
transferred, assigned, pledged or hypothecated by any Party hereto, other than
by operation of law or with the written consent of the other Party. This
Agreement shall be binding upon and shall inure to the benefit of the Parties
hereto, their Affiliates and their respective successors and permitted assigns.
Section 6.9 Counterparts. This Agreement may be executed in
counterparts, which taken together shall constitute one instrument.
Section 6.10 Entire Agreement. This Agreement, including the other
documents referred to herein which form a part hereof, contains the entire
understanding of the Parties hereto with respect to the subject matter contained
herein and therein. This Agreement supersedes all prior agreements and
understandings between the Parties with respect to such subject matter.
Section 6.11 Amendments. This Agreement may not be changed orally,
but this Agreement may be terminated and any provision of this Agreement can be
waived, amended, supplemented or modified only by an agreement in writing signed
by Asarco and Coeur.
Section 6.12 Severability. In case any provision in this Agreement
shall be held invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions hereof will not in any way be
affected or impaired thereby.
Section 6.13 Third Party Beneficiaries. Each Party hereto intends
that this Agreement shall not benefit or create any right or cause of action in
or on behalf of any Person other than the Parties hereto.
IN WITNESS WHEREOF, each of Asarco and Coeur has caused this
Agreement to be executed by its officer thereunto duly authorized as of the day
and year first above written.
ASARCO INCORPORATED
By: /s/ Xxxxxxx X. XxXxxxxxxx
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Name: Xxxxxxx X. XxXxxxxxxx
Title: Chairman and Chief
Executive Officer
COEUR D'XXXXX XXXXX CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
---------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Chairman and Chief
Executive Officer
