EXHIBIT 99.3
SHAREHOLDERS AGREEMENT
Dated July 14, 2008
Between
Indian Farmers Fertiliser Cooperative Limited
("IFFCO")
And
Xxxxxx Xxxxxxx
("JG")
SHAREHOLDERS AGREEMENT
This Shareholders Agreement (this "Agreement") is made as of this 14th day of
July,, 2008 ("Execution Date"),
Between:
Indian Farmers Fertiliser Cooperative Limited, a multi state co-operative
society duly incorporated and validly existing under the laws of India and
having its registered office at X0, Xxxxxxxx Xxxxxx, Xxxxx Xxxxx, Xxx Xxxxx -
000000 (hereinafter referred to as "IFFCO", which expression shall unless
repugnant to the context or meaning thereof, include its successors and
permitted assigns);
AND
Xxxxxx Xxxxxxx,("JG") President and CEO of Legend International Holdings, Inc.
("Legend" or "Company"), which expression shall unless repugnant to the context
or meaning thereof include his legal heirs and permitted assigns);
(IFFCO and JG are hereinafter collectively referred to as "Parties" and
individually as a "Party")
WHEREAS:
A. IFFCO is involved, interalia, in the business of production and
distribution of fertilizers and other agri-related products and services
to the farmers in India;
B. JG is the Chairman of the Board, President and Chief Executive Officer
of the Company and his Affiliates, Xxxxxx Pty Ltd. ("Xxxxxx") and Chabad
House of Caulfield Pty Ltd. ("Caulfield"), are substantial shareholders
of the Company;
C. The Company is a corporation engaged in the business of mineral
exploration and development, and wishes to enter into the area of
production and marketing of minerals;
D. As of the Execution Date, IFFCO and Legend have entered into a Share
Option Agreement ("Share Option Agreement") wherein IFFCO or its
Affiliates shall, interalia, have the option to subscribe to the Shares
at a future date on the terms and conditions of the Share Options
Agreement; and
E. IFFCO and JG are now entering into this Agreement in order to regulate
their relationship as shareholders, either directly or through their
Affiliates, hereto in the management and operation of the Company and
exercise their mutual rights and obligations in relation to the Company
in accordance with the terms and conditions set forth in this Agreement.
NOW THEREFORE, in consideration of the mutual covenants, terms and conditions
and understandings set forth in this Agreement and other good and valuable
consideration (the receipt and adequacy of which are hereby mutually
acknowledged), the Parties with the intent to be legally bound hereby agree as
follows:
ARTICLE 1
DEFINITION AND INTERPRETATIONS
1.1 Definitions:
-----------
In this Agreement, the following words and expressions unless
inconsistent with the context, shall bear the meanings assigned hereto:
"Act" shall mean the Delaware General Corporation Law, and any rules or
regulations framed there under and any subsequent re-enactment thereof
for the time being in force;
"Affiliate" in relation to a Party shall mean any company, partnership,
association, foundation, trust, co-operative society or other legal
entity, which through ownership of voting stock or otherwise, directly
or indirectly, is controlled by, under common control with, or in
control of such Party and in relation to JG, includes any Relative of
such natural person. For the purpose of this definition the term
"control" means ownership of more than fifty percent (50%) of the voting
stock of a company, or the power to appoint or elect a majority of the
directors of a company, or the power to direct the management of a
company.
It is clarified that the following are Affiliates of JG and on the
Execution Date hold Shares in the Company and shall execute an Affiliate
Deed of Adherence before Closing Date. Xxxxxx Pty Ltd. Chabad House of
Caulfield Pty Ltd.
"Affiliate Deed of Adherence" shall have the meaning ascribed to it in
Article 3.1 hereto;
"Agency Agreement" shall mean the agreement between Legend and BMO
Xxxxxxx Xxxxx Inc., Wellington West Capital Markets Inc and BBY Limited,
dated as of June 3, 2008.
"Agreement" shall mean this Shareholders Agreement and includes any
recitals and annexures to this Agreement, and any amendments to this
Agreement effected in accordance with the terms of this Agreement;
"Board" or "Board of Directors" shall mean the board of directors of the
Company;
"Business" shall mean mineral exploration, development, production and
sale of minerals and related activities, and such business as may be
decided from time to time by the Board ;
"Business Day" shall mean a day which is not a Saturday or Sunday or a
bank or other public holiday in Australia, India or the United States;
"Chairman" shall mean the chairperson of the Board;
"Chief Executive Officer" or "CEO" shall have the meaning ascribed to it
in the Governing Documents;
"Closing Date" shall be 15 Business Days after the Execution Date;
"Common Stock" shall mean the common stock of the Company;
"Company Representations" shall have the meaning ascribled to it in
Article 5.1 hereto.
"Confidential Information" shall have the meaning ascribed to it in
Article 9.1 hereto;
"Determination Notice" shall have the meaning ascribed to it in Article
7.3.2 hereto;
"Director" shall mean a director of the Company;
"Execution Date" shall have the meaning ascribed to it in the preamble;
"Exempt Securities" shall mean shares of Common Stock issued after the
Execution Date (other than shares issued as a result of the exercise of
options on issue as on the Execution Date) to employees, officers,
directors, consultants, other persons performing services for the
Company pursuant to any stock option plan, or similar equity based
compensatory arrangement approved by a majority of the Board of
Directors not exceeding 6.5 million shares;
"General Meeting" shall mean the duly convened annual or extraordinary
general meeting of the Shareholders of the Company;
"Governing Documents" shall mean the By Laws or Certificate of
Incorporation any other document that lays down the object and the rules
of operations of the Company, as amended from time to time in accordance
with the Act;
"IFFCO Nominee" shall mean a Director nominated by IFFCO;
"Indemnifying Party" shall have the meaning ascribed to it in Article
8.1 hereto;
"Indemnified Party" shall have the meaning ascribed to it in Article 8.1
hereto;
"JG Nominee" shall mean a Director nominated by JG;
"Law" shall mean any law, statute, ordinance, rule, regulation,
guideline, policy or other pronouncement having the effect of law of any
governmental authority, as currently interpreted and administered;
"Loss" shall have the meaning ascribed to it in Article 8.1 hereto;
"No Purchase Notice" shall have the meaning ascribed to it in Article
5.4.1(c) hereto;
"Notifying Party" shall have the meaning ascribed to it in Article 7.3.2
hereto;
"Offer Acceptance Notice" shall have the meaning ascribed to it in
Article 5.4.1(a) hereto;
"Offered Party" shall have the meaning ascribed to it in Article 5.4.1
hereto;
"Offering Party" shall have the meaning ascribed to it in Article 5.4.1
hereto;
"Offer Period" shall have the meaning ascribed to it in Article 5.4.1
hereto;
"Offer Price" shall have the meaning ascribed to it in Article 5.4.1
hereto;
"Offered Shares" shall have the meaning ascribed to it in Article 5.4.1
hereto;
"Owner" shall have the meaning ascribed to it in Article 9.1 hereto;
"Party" shall mean either IFFCO or JG, as the case may be;
"Parties" shall mean IFFCO and JG collectively;
"Person" shall mean any natural person, limited or unlimited liability
company, corporation, partnership, proprietorship, Hindu undivided
family, trust, union, association, government or any agency or political
subdivision thereof of any other entity that may be treated as a person
under applicable Law;
"Prospectus" shall have the meaning ascribed to it in Article 5.1
hereto;
"Recipient" shall have the meaning ascribed to it in Article 9.1 hereto;
"Rectification Period" shall have the meaning ascribed to it in Article
7.3.3 hereto;
"Relative" of a natural person shall mean the person's child, stepchild,
parent, stepparent, spouse, sibling, mother-in-law, father-in-law,
son-in-law, daughter-in-law, brother-in-law, sister-in-law;
"Share" shall mean a share in the authorized, issued and subscribed
equity share capital of the Company;
"Share Capital" shall mean the paid-up equity/voting share capital of
the Company;
"Share Options Agreement" shall have the meaning ascribed to it in
Recital D;
"Shareholder(s)" shall mean any person holding Shares of the Company;
"Shareholder Group" shall have the meaning ascribed to it in Article
5.3.5;
"Subsidiary" shall have the meaning ascribed to it in the Act;
"Tag Along Acceptance Notice" shall have the meaning ascribed to it in
Article 5.4.1.
"Tag Along Rights" shall have the meaning ascribed to it in Article
5.4.3.
"Tag Along Shares" shall have the meaning ascribed to it in Article
5.4.3.
"Terminated Party" shall have the meaning ascribed to it in Article
7.3.1 hereto;
"Termination Event" shall have the meaning ascribed to it in Article 7.3
hereto;
"Third Party Buyer" shall have the meaning ascribed to it in Article
5.4.1 hereto;
"Transfer" shall have the meaning ascribed to it in Article 5.2.1
hereto;
"Transfer Notice" shall have the meaning ascribed to it in Article 5.4.1
hereto.
"Unanimity Matters" shall have the meaning ascribed to it in Article
4.3.1 hereto;
"Voting Securities" means the Common Stock and any other securities of
the Company or its successors that are entitled by their terms to vote
generally in the election of directors of the Company or its successors
and all options, rights, warrants and other securities convertible into,
or exercisable or exchangeable for, any shares of the Common Stock or
other securities possessing such voting rights.
1.2 Interpretations:
---------------
Except where the context requires otherwise, this Agreement will be
interpreted as follows:
(a) The definitions in Article 1.1 shall apply equally to both the
singular and plural form of the terms defined.
(b) Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter form.
(c) The words "include," "includes" and "including" shall be deemed
to be followed by the phrase "without limitation."
(d) Unless the context otherwise requires, (i) all references to
Articles annexures are to Articles and Annexures to, this
Agreement; and (ii) the terms "herein," "hereof," "hereto",
"hereunder" and words of similar import refer to this Agreement
as a whole.
(e) Where any act, matter or thing is required by this Agreement to
be performed or carried out on a certain day and that day is not
a business day then that act, matter or thing shall be carried
out or performed on the next following business day.
1.3 Any reference in this Agreement to an obligation to be performed by a
Party shall be construed so as to include an obligation of such Party to
procure that its Affiliates perform and/or comply with such obligation.
1.4 Unless defined in this Agreement capitalised terms used in this
Agreement shall have the meaning as provided in the Share Purchase
Agreement.
ARTICLE 2
PURPOSE AND OBJECTIVES
2.1 Commitments of the Parties:
--------------------------
2.1.1 The Parties hereby agree and undertake towards each other:
(a) to perform and observe all of the provisions of this Agreement,
and all other agreements governing their relationship as
Shareholders of the Company;
(b) to procure that (i) every person for the time being representing
it in its capacity as Shareholder; and (ii) every person
appointed as a Director in terms of this Agreement will exercise
any power to vote or cause the power to vote to be exercised, at
any meeting of the Shareholders or the Board of the Company, as
the case may be, so as to enable the approval of any and every
resolution necessary or desirable to procure that the affairs of
the Company are conducted in accordance with and otherwise to
give full effect to this Agreement, and likewise so as to ensure
that no resolution is passed which is not in accordance with
such provisions, subject to the compliance by the Directors with
their fiduciary duties to Shareholders and all other obligations
under the Act; and
(c) to cause any of its Affiliates, to comply with the provisions of
this Article 2.1.1.
2.1.2 JG shall support any and all resolutions in the Board and the General
Meetings to procure that in case of a fresh issue of Shares of the
Company other than Exempt Securities, IFFCO shall have the right to
subscribe to such number of Shares of any such issue so as to maintain
its percentage equity in the Company post issue as it existed prior to
the issue.
2.2 Governing Documents:
-------------------
The Parties agree that to the extent the Governing Documents are in
conflict with or are inconsistent with the terms and conditions of this
Agreement, inter se the Parties, the provisions of this Agreement shall
prevail and the Parties shall take such steps as may be reasonably
necessary to alter the Governing Documents as soon as is practicable so
as to eliminate such conflict or inconsistency, subject to the Act.
ARTICLE 3
AFFILIATES
3.1 In computing the shareholding of a Party for the purposes of this
Agreement, the Shares held by its respective Affiliates shall be taken
into account, provided however, that the Affiliate(s) to whom the Shares
are allotted shall covenant with the other Parties in the form of Deed
of Adherence as specified in Annexure 1 hereof ("Affiliate Deed of
Adherence") to observe this Agreement and to perform all the obligations
of a Party under this Agreement and thereupon each such Affiliate shall
be treated as a Party herein or therein.
ARTICLE 4
MANAGEMENT OF THE COMPANY
4.1 Board of Directors:
4.1.1 On or before the Closing Date, the Board shall be (a) increased to six
(6) members, subject to the removal provisions of the Company's
Governing Documents, and (b) initially composed of four (4) JG Nominees
and two (2) IFFCO Nominees. Thereafter the Parties shall be entitled to
nominate Directors on the Board proportionate to their respective
shareholding (along with the shareholding of their Affiliates) in the
Company subject to IFFCO having the right to nominate at least two (2)
Directors. In the event that the shareholding of JG is less than that of
IFFCO, IFFCO shall have the option to maintain the composition of the
Board as it existed immediately prior to JG's shareholding becoming less
than that of IFFCO, or to call a General Meeting to elect a new Board of
Directors.
4.1.2 At any subsequent General Meeting, each Party shall vote or cause to be
voted all Voting Securities owned by him or it or which he or it has
voting control, and otherwise use its respective reasonable best
efforts, so as to cause to be elected as Directors nominees selected by
each Party to their respective shareholding (along with the shareholders
of their Affiliates) in the Company subject to JG and his Affiliates
having the right to nominate one Director more than IFFCO and its
Affiliates as long as the shareholding of JG and his Affiliates in the
Company is higher than that of IFFCO and its Affiliates. In the event
that the shareholding of JG and his Affiliates is less than that of
IFFCO andits Affiliates, IFFCO shall have the option to maintain the
composition of the Board as it existed immediately prior to JG's and his
Affiliates' shareholding becoming less than that of IFFCO and its
Affiliates, or to call a General Meeting to elect a new Board of
Directors. The nominees selected by the Parties must meet the
requirements of the American Stock Exchange or other exchange or market
upon which the Common Stock is traded, including, if applicable, the
requirement that a majority of the Board of Directors be "independent
directors." Nothing contained herein shall be deemed to limit the rights
of the remaining Shareholders to nominate candidates for election to the
Board in accordance with the Act.
4.1.3 In the event that any JG Nominee or IFFCO Nominee shall for any reason
cease to serve as a member of the Board during his or her term of
office, the resulting vacancy on the Board will be filled by a
representative designated, respectively, by JG or IFFCO, as the case may
be.
4.2 Committee of the Board:
----------------------
In case the Board constitutes committees or sub-committees of the Board,
at least one JG Nominee and one IFFCO Nominee shall be entitled to be
members of all committees; provided that, the appointees selected by the
Parties to serve on any Board committee or sub-committee must meet the
requirements of the American Stock Exchange or other exchange or market
upon which the common stock is traded, including, if applicable, the
requirement that the members of a committee or sub-committee be
"independent directors."
4.3 Unanimity Matters:
-----------------
4.3.1 The Parties agree that a decision on any of the matters listed at
Annexure 2 ("Unanimity Matters") shall require the unanimous approval of
the Board. In addition, to the extent that the approval of Shareholders
is required for a Unanimity Matter, the Parties agree to vote their
shares of Voting Stock on the matter only by mutual agreement.
4.3.2 If the Parties are unable to agree on any Unanimity Matter, the matter
will be resolved under the Provisions of Article 10.7 of this Agreement
dealing with dispute resolutions.
ARTICLE 5
TRANSFER OF SHARES
5.1 Transfer of Shares by JG to IFFCO
---------------------------------
Notwithstanding any other provisions of this Article, before the Closing
Date, JG shall sell 15 (fifteen) million Shares out of his own or his
Affiliates' shareholding in the Company to IFFCO or its Affiliates for a
consideration of USD 1.87 per Share for a total consideration of USD
28.05 million, which shall be payable before the Closing Date by wire
transfer of immediately available funds to a bank designated by JG.
JG represents and warrants that the representations and warranties (the
"Company Representations") set forth in Section 8 of the Agency
Agreement are true and correct in all material respects except as set
forth in Annexure 2 annexed hereto.
IFFCO acknowledges and agrees that the Shares are being sold pursuant to
that certain prospectus dated April 17, 2008 (the "Prospectus") and the
Company Representations and represents that it has reviewed the
Prospectus, including the information set forth under the heading "Risk
Factors."
5.2 Restriction of Transfer:
-----------------------
5.2.1 Each Party shall sell, transfer, assign, pledge, or otherwise dispose
off ("Transfer") its Shares in the Company only in accordance with this
Agreement. The Board and /or the Company shall not register any Transfer
unless such Transfer is made in accordance with this Agreement.
5.3 Transfer to Affiliate:
---------------------
5.3.1 Either Party is entitled to Transfer its Shares to one or more of its
Affiliate provided that such Affiliate enters into an Affiliate Deed of
Adherence to be bound by the provisions of this Agreement.
5.3.2 In the event that any Person holding Shares in accordance with the
provisions of this Agreement by virtue of being an Affiliate of a Party
ceases to be an Affiliate of such Party, such Party shall acquire or
cause any of its other Affiliate to acquire, full and unconditional
title in and to all of the Shares then held by such Person ceasing to
qualify as an Affiliate.
5.3.3 Any Party entitled to purchase Shares under this Article 5 shall have
the right to designate any of its Affiliate(s) to purchase the Shares,
in place and stead of such Party.
5.3.4 The provisions of Article 5.2 (Restriction on Transfer) shall apply to
an Affiliate to whom any Shares have been transferred under this Article
5.3.
5.3.5 Notwithstanding any provisions to the contrary in this Agreement, if any
Party transfers part of its Shares to any Affiliate or additional Shares
are issued to any Affiliates of such Party (i) all of such Party, and/or
Affiliates (Collectively, the "Shareholder Group") shall be treated as a
single Party qua such Party. A breach by any one person in the
Shareholder Group of its rights, obligations, covenants or undertakings
hereunder shall be deemed as a collective breach by the other members of
the Shareholder Group of their respective rights, obligations, covenants
or undertakings hereunder, and (ii) JG and IFFCO shall (a) act for and
on behalf of each member of their respective Shareholder Group under
this Agreement in respect of any right, action or waiver to be exercised
by any member of their Shareholder Group (including the nomination,
replacement or removal of the Directors) and (b) be responsible for
causing each of the members of the Shareholder Group to perform its
obligations, covenants and undertakings hereunder.
5.4 Pre-emptive and Tag Along Rights:
--------------------------------
Subject to Article 5.3 above, a Party may Transfer its Shares in the
Company without restriction subject only to complying with Section 5.4
as follows:
5.4.1 In the event a Shareholder desires to Transfer its Shares ("Offering
Party") to any third party, it shall first offer all and not less than
all, of its/its Affiliates Offered Shares (as defined hereinafter) to
the other Shareholder ("Offered Party") in proportion to their then
Shareholding by serving a notice in writing ("Transfer Notice") to the
Offered Party mentioning therein (a) the total number of Shares proposed
to be offered for sale ("Offered Shares"); (b) the price at which the
Offered Shares are being offered for sale ("Offer Price"); and (c) other
terms and conditions for the Offered Shares including the period for
which such offer shall be available to Offered Party, which period shall
not be less than 30 (thirty) days ("Offer Period"); and (d) the complete
details and identity of the proposed buyer ("Third Party Buyer") willing
to purchase the Offered Shares. Upon receipt of the Transfer Notice, the
Offered Party shall, within the Offer Period, communicate through notice
in writing as to whether:
(a) the Offered Party is willing to purchase all, but not less than
all, of the Offered Shares ("Offer Acceptance Notice"). In such
case, the provisions of Article 5.4.2 shall apply; or
(b) the Offered Party is not willing to acquire the Offered Shares
but is willing to exercise the Tag Along Rights ("Tag Along
Acceptance Notice"). In such event, the provisions of Article
5.4.3 shall apply; or
(c) the Offered Party is neither willing to acquire the Offered
Shares nor willing to exercise the Tag Along Rights ("No
Purchase Notice"); or if the Offered Party fails to complete the
share purchase after giving the Offer Acceptance Notice within
the time period mentioned in Article 5.4.2 below except when
such failure is owing to any Governmental Approval or owing to
any default of the Offering Party; or if the Offered Party fails
to respond to the Transfer Notice within the timeframe indicated
therein, shall be deemed to be not interested in acquiring the
Offered Shares or exercising the Tag Along Rights and the same
shall be deemed to be No Purchase Notice from the Offered Party.
In such event, the Offering Party shall within 90 (ninety) days
of the No Purchase Notice, have the right to sell, the Offered
Shares to the Third Party Buyer, provided that such Third Party
Buyer agrees to purchase the Offered Shares at a price not less
than the Offer Price and on terms and conditions not more
favourable than those offered to the Offered Party in the
Transfer Notice. It is clarified that if the Third Party Buyer
fails to consummate the purchase of Shares within 90 (ninety)
days of the No Purchase Notice or any of the material terms of
the offer change before the transaction is consummated, the
Offering Party shall again be required to comply with the
provisions under this Article.
5.4.2 Upon receipt of the Offer Acceptance Notice, transfer of all, but not
less than all, of the Offered Shares to the Offered Party shall take
place at the time and date at the registered office of the Company
within 30 (thirty) days from the receipt of the Offer Acceptance Notice
by the Offering Party.
5.4.3 The Offered Party shall have the tag along right but not the obligation
to sell and transfer such proportionate number of Shares ("Tag Along
Shares") to the Third Party Buyer at the same price and on terms and
conditions on which the Third Party Buyer agreed to purchase the Offered
Shares from the Offering Party ("Tag Along Rights"). The Tag Along
Shares shall be in proportion to the other Shares vis-a-vis the Shares
held by the Offering Party (as an example, if an Offering Party proposes
to sell 10% (ten percent) of its total Shareholding, the Tag Along
Shares will be 10% (ten percent) of the total Shareholding of the
Offered Party. In the event, the Offered Party exercises its Tag Along
Rights, the Offered Party shall communicate its acceptance to the
Offering Party within the Offer Period, as per Article 5.4.1(b) above.
Upon the Offered Party exercising its Tag Along Rights, the Offering
Party shall ensure that the Third Party Buyer shall purchase the Tag
Along Shares from the Offered Party and make payment of the
consideration to the Offered Party simultaneously with the Third Party
Buyer purchasing the Offered Shares and making payment to the Offering
Party for the same, whichever is earlier. The Offering Party shall also
provide a representation to the Offered Party that no consideration,
tangible or intangible, is being offered which is not reflected in the
Offer Price (including a refund or discount).
ARTICLE 6
REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PARTIES
6.1 Representations, Warranties and Covenants of JG:
-----------------------------------------------
JG represents, warrants and covenants to the Parties as follows:
(a) JG has the power and authority to enter into this Agreement and
to perform his obligations hereunder.
(b) All actions on the part of JG necessary for the authorisation,
execution and delivery of this Agreement by JG and for the
performance of all of his obligations hereunder have been taken.
(c) This Agreement constitutes valid, legally binding and
enforceable obligations of JG.
(d) JG has done or will do all acts, executed and delivered all
instruments and documents, and done all things as may be
reasonably necessary to accomplish the transactions contemplated
in this Agreement.
(e) Neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby shall
violate, result in the breach of any material terms or provision
of, or constitute a default under its statutes or regulations or
any material agreement, indenture, instrument or order, law or
regulation to which he is a party or by which he is bound.
(f) The Shares being sold to IFFCO or its Affiliates, pursuant to
this agreement are voting shares and are freely transferable,
subject to compliance with the applicable United States Federal
securities laws.
6.2 Representations, Warranties and Covenants of IFFCO:
--------------------------------------------------
IFFCO represents, warrants and covenants to the Parties as follows:
(a) IFFCO is a multi-state co-operative society duly organized,
validly existing and in good standing under the laws of India
and has the power and authority to enter into this Agreement and
to perform its obligations hereunder.
(b) All actions on the part of officers and directors of IFFCO
necessary for the authorisation, execution and delivery of this
Agreement by IFFCO and for the performance of all of its
obligations hereunder have been taken.
(c) This Agreement constitutes valid, legally binding and
enforceable obligations of IFFCO.
(d) IFFCO has done or will do all acts, executed and delivered all
instruments and documents, and done all things as may be
reasonably necessary to accomplish the transactions contemplated
in this Agreement.
(e) Neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby shall
violate, result in the breach of any material terms or provision
of, or constitute a default under its statutes or regulations or
any material agreement, indenture, instrument or order, law or
regulation to which it is a party or by which it is bound.
ARTICLE 7
TERM AND TERMINATION
7.1 Term:
----
This Agreement shall be valid and binding unless terminated in
accordance with the provisions of this Agreement.
7.2 Termination:
-----------
This Agreement may be terminated by the Parties by mutual written
agreement between the Parties and shall be terminated automatically in
the event that any Party ceases to hold at least 3% (three percent) of
the Share Capital, directly or indirectly. This Agreement may also be
terminated in accordance with Section 7.3.4.
7.3 Right to Terminate for Cause:
----------------------------
7.3.1 Occurrence of any of the following events in respect of all of JG and
Affiliates or IFFCO and Affiliates ("Terminated Party") shall be a
Termination Event for the purpose of this Article 7.3:
(a) if any Party is in breach of or fail to observe or comply with
any material term, covenant or obligation contained in this
Agreement or termination (due to breach) of any other agreement
between the Parties or their respective Affiliates, relating to
the Company;
(b) Terminated Party goes into liquidation (other than a voluntary
liquidation for the purpose of reconstruction and where all
rights and obligations are validly assigned) or receivership or
is otherwise insolvent or an order of winding up is passed by a
competent court, as applicable.
7.3.2 In the event of the occurrence of a Termination Event, any Party (the
"Notifying Party") shall give Notice of the alleged Termination Event
("Determination Notice") to the Terminated Party.
7.3.3 The Terminated Party shall have period of 30 (thirty) Business Days from
the receipt of the Determination Notice to rectify the Termination
Event. If such Termination Event is not reasonably capable of being
rectified within such period of 30 (thirty) Business Days, the
Terminated party shall take substantial and appropriate steps to
effectuate such rectification within a period of 30 (thirty) Business
Days from the receipt of the Determination Notice and rectify such
Termination Event within a period of 60 (sixty) Business Days of the
receipt of the Determination Notice (such period of 30 (thirty) Business
Days or 60 (sixty) Business Days, as the case may be, the "Rectification
Period").
7.3.4 If upon expiry of the Rectification Period, a Termination Event has not
been so rectified,, the non-Terminated Party shall have the right to
terminate this Agreement immediately upon written notice to the
Terminated Party.
ARTICLE 8
INDEMNITY
8.1 Indemnification:
---------------
Each Party ("Indemnifying Party") hereby irrevocably and unconditionally
agrees to indemnify and hold the other Party ("Indemnified Party")
harmless from and against any and all liabilities, losses, damages,
costs, claims, actions, proceedings, judgements, settlements, expenses
or the like (collectively ("Loss") which may be suffered or incurred
directly, but not consequentially, by the Indemnified Parties as a
result of any misrepresentation or breach of any representation or
warranty made by the Indemnifying Party in this Agreement or
non-fulfillment of or failure to perform any covenant or obligation or
agreement or undertaking contained in this Agreement by the Indemnifying
Party.
8.2 Notice of Claim:
---------------
Any indemnifiable claim under this Agreement must, in order to be valid
and effective hereunder, be asserted by the Indemnified Party by prompt
delivery of written notice thereof to the Indemnifying Party delivered
within 60 (sixty) Business Days of discovery by the Indemnified Party of
the breach of the breach of the pertinent covenant or obligation.
8.3 Limitation of Liability:
-----------------------
The Parties (including for this purpose, their Affiliates) shall not be
liable for each others indirect, special or consequential damages
(including lost profits or lost revenues) under this Agreement,
regardless of whether such liability arises in tort, contract, breach of
warranty, indemnification or otherwise.
ARTICLE 9
CONFIDENTIALITY
9.1 Confidential Information:
------------------------
For purposes of this Agreement, "Confidential Information" shall mean
all written and/or tangible information created by the Company or
disclosed by a Party (in either case "Owner") to the receiving Party
("Recipient") which is marked confidential or proprietary and/or not
generally available to the public, including, but not limited to
information relating to this Agreement, in whole or in part to present
and future products, services, business plans and strategies, marketing
ideas and concepts, present and future product plans, financial data and
business plans. Notwithstanding the foregoing, information shall not be
deemed confidential and the Recipient shall have no obligation with
respect to any such information which:
(a) is already known to the Recipient; or
(b) is or becomes publicly known through no negligence or other
wrongful act of the Recipient; or
(c) is received by the Recipient from a third party without similar
restriction and without breach of this Agreement; or
(d) is independently developed by the Recipient.
Notwithstanding the foregoing, the Parties acknowledge and agree that as
a public company registered under Section 12(g) of the Securities
Exchange Act of 1934, as amended, the Company shall be required to make
public disclosure of the terms of this Agreement and the Share Options
Agreement and to file copies of such Agreements with the Securities and
Exchange Commission.
9.2 Treatment of Confidential Information:
-------------------------------------
From the execution of this Agreement and after the Recipient ceases to
be a shareholder in the Company, the Recipient shall, and shall cause
its Affiliates to, keep confidential and will not disclose, and will
cause its Affiliates not to disclose, to Third Parties, the Confidential
Information received from, or made available by the Owner and will use
and cause its Affiliates to use the same level of care with respect to
the Confidential Information as Recipient employs with respect to its
own proprietary and confidential information of like importance, and
will not use and will cause Affiliates not to use such Confidential
Information for any purpose other than the performance of its
obligations under this Agreement.
9.3 Notice Prior to Disclosure:
--------------------------
If the Recipient (or its Affiliates) is required by Law (by oral
questions, interrogatories, requests for information or documents,
subpoena, civil investigative demand or similar process) to disclose any
Confidential Information, the Recipient will promptly notify the Owner
of such request or requirement. If the Recipient (or any of its
Affiliates) is compelled to disclose the Confidential Information or
else stand liable for contempt or suffer other censure or significant
legal penalty, the Recipient (or its Affiliate) may disclose only so
much of the Confidential Information to the Party compelling disclosure
as is required by Law.
9.4 Exercise of Due Diligence:
-------------------------
Each Party shall ensure that any of its employees involved in or
otherwise having knowledge of any Confidential Information shall comply
with the obligations set forth in this Article 9.
9.5 Disclosure of Confidential Information:
--------------------------------------
All Directors shall be entitled to be informed by the Party appointing
such Director of all matters concerning the Company's affairs. Each
Director and each Recipient undertakes to keep such information
confidential and shall not use or disclose any Confidential Information
to any third party for any unauthorized purpose and shall take all
reasonable precautions for the safe custody of such Confidential
Information for so long as it shall remain confidential or proprietary.
The Parties shall however be permitted to disclose Confidential
Information only to their directors, investors, investment advisors,
lenders, employees and employees of investment advisors, other advisors,
including financial and legal advisors, and agents or pursuant to any
legally mandated reporting requirements, or as required pursuant to the
constitutional documents of the Parties or the Affiliates of the
Parties.
ARTICLE 10
MISCELLANEOUS
10.1 Notices:
-------
Any notices, requests, demands or other communication required or
permitted to be given under this Agreement shall be written in English
and shall be delivered in person, or sent by courier or by certified or
registered mail, postage prepaid or transmitted by facsimile and
property addressed as follows:
If to IFFCO:
-----------
Name: Indian Farmers Fertiliser Cooperative Limited
Address: IFFCO Sadan, X-0
Xxxxxxxx Xxxxxx, Xxxxx Xxxxx
Xxx Xxxxx - 000000
Xxxxxxxxx: Managing Director
Fax: x00-00-00000000
If to the JG by international courier:
-------------------------------------
Name: Xxxxxx Xxxxxxx
Address: Xxxxx 0, 000 Xx Xxxxx Xxxx
Xxxxxxxxx Xxxxxxxx 0000
Xxxxxxxxx
Attention: Xxxxxx Xxxxxxx
Fax: x000-0000-0000
If to the JG by post:
--------------------
Name: Xxxxxx Xxxxxxx
Address: X.X. Xxx 0000 Xx. Xxxxx Xxxx Xxxxxxx,
Xxxxxxxxx Xxxxxxxx 0000
Xxxxxxxxx
Attention: Xxxxxx Xxxxxxx
Fax: x000-0000-0000
or at such other address as the Party to whom such notices, requests,
demands or other communication is to be given shall have last notified
the Party giving the same in the manner provided in this Article 10.1,
but no such change of address shall be deemed to have been given until
it is actually received by the Party sought to be charged with the
knowledge of its contents. Any notice, request, demand or other
communication delivered to the Party to whom it is addressed as provided
in this Article 10.1 shall be deemed (unless there is evidence that it
has been received earlier) to have been given and received if:
(f) sent by mail, except air mail, ten Business Days after posting
it;
(g) sent by air mail, six Business Days after posting it; and
(h) sent by facsimile, when confirmation of its transmission has
been recorded by the sender's facsimile machine.
10.2 Waiver of Rights:
----------------
Failure or delay on the part of either Party to exercise any right,
power or privilege under this Agreement shall not operate as a waiver
thereof; nor shall any single or partial non-exercise of any right,
power or privilege preclude any other future exercise thereof.
10.3 Severability:
------------
This Agreement is severable and if any provision hereof is determined to
be illegal or unenforceable, the offending provision shall be struck off
without affecting the remaining provisions of this Agreement, in which
case, if appropriate and necessary, the Parties shall immediately
consult with each other in order to find an equitable solution.
10.4 Surviving Provisions:
--------------------
10.4.1 The rights and obligations of the Parties in respect of Articles 5, 8, 9
and 10 shall continue to have effect in accordance with their respective
terms notwithstanding the termination of this Agreement.
10.4.2 The termination of this Agreement will not in any manner affect the
rights and obligations in respect of antecedent breaches of this
Agreement.
10.4.3 If either Party ceases to hold, directly or indirectly, at least 3%
(three percent) of the Share Capital in the Company and this Agreement
terminates, such Party shall, procure the removal of the Directors
appointed by it in accordance with the provisions of Article 4.
10.5 Entire Agreement:
----------------
This Agreement and all annexures set forth the entire agreement of the
Parties with respect to the subject matter of this Agreement and
supersede all prior agreements, understandings and representations,
written and oral.
10.6 Governing Law:
-------------
The validity, interpretation, implementation and resolution of disputes
of this Agreement shall be governed by the laws of England.
10.7 Dispute Resolution:
------------------
(a) In the event any dispute arises between the Parties out of or in
relation to this Agreement, including any dispute regarding its
interpretation, breach, termination or validity, the Parties
shall attempt in the first instance to resolve such dispute
through friendly and amicable consultations.
(b) If a dispute arising between the Parties out of or in relation
to this Agreement has not been resolved through consultations
under Article 10.7(a) within thirty (30) days after the
Party(ies) has served written notice on the other Party(ies)
requesting the commencement of such consultations, then the
dispute shall be referred to an arbitral tribunal. The
arbitration proceedings shall take place in Singapore and be
conducted in English in accordance with the provisions of
Singapore International Arbitration Rules of arbitration as may
be in force from time to time. The arbitration award shall be
final and binding on the Parties, and the Parties shall be bound
thereby and act accordingly. The costs of arbitration shall be
borne by the Parties as designated in the arbitration award.
(c) While any dispute is under consultation or arbitration, except
for the matters under dispute, the Parties shall continue to
exercise their remaining respective rights, and fulfill their
remaining respective obligations in accordance with this
Agreement.
(d) Notwithstanding the existence of any dispute or difference
between the Parties which is referred to settlement or, as the
case may be, arbitration, all Parties shall, during the pendency
of the settlement or, as the case may be, arbitration, continue
to act on matters under this Agreement which are not the subject
matter of the dispute or differences as if no such dispute or
difference had arisen to the end and intent that the business
and operations of the Company are not affected during the
pendency of such settlement or arbitration.
(e) The arbitration panel may not limit, expand or otherwise modify
the terms of this Agreement.
10.8 Relationship:
------------
Nothing in this Agreement shall be in any way construed to constitute
either Party as the agent, employee or representative of the other.
10.9 Amendments:
----------
This Agreement may be amended only by an instrument in writing signed by
duly authorised representatives of each of the Parties.
10.10 Assignment:
----------
Except as otherwise provided in this Agreement, the rights and
obligations under this Agreement shall not be assigned by any Party to
any person.
10.11 Counterparts:
------------
This Agreement may be entered into in any number of counterparts each of
which, when executed and delivered, shall be an original, but all the
counterparts shall together constitute one and the same instrument.
IN WITNESS WHEREOF, the Parties by their duly authorised representatives have
executed this Agreement on the day first above written
For Indian Farmers Fertiliser Cooperative For Legend International Holdings,
Limited Inc.
s/s/ U.S. Xxxxxxx s/s/ XX Xxxxxxx
--------------------- ---------------------
Name: U.S. Xxxxxxx Name: XX Xxxxxxx
Designation: Managing Director Designation: President & CEO
Date:July 14, 2008 Date:July 14, 2008
Witnessed by: Xxxxxx Xxxx Witnessed by: Xxxxx Xxxxx Xxx
ANNEXURE 1
AFFILIATE DEED OF ADHERENCE
This Affiliate Deed of Adherence ("Affiliate Deed") is executed this [o] day of
[o] by [o], a company/ body corporate incorporated under the laws of [o] having
its registered office/principal place of business at [o] (the "Transferee").
WHEREAS:
A. By a Shareholders Agreement dated [o] (the "Shareholders Agreement")
among JG and IFFCO (collectively the "Parties"), the Parties agreed to
regulation of their rights and liabilities as shareholders of the
Company.
B. The Shareholders Agreement requires, inter alia, that, concurrently with
the ownership of Shares by any of the Parent's Affiliates, through
Transfer of Shares or rights, by any Party ("Parent"), such Affiliates
shall, as a condition of such Transfer of Shares to it execute this
Affiliate Deed and be bound by the Shareholders Agreement.
NOW THIS AFFILIATE DEED WITNESSETH AS FOLLOWS:
1. Definition and Interpretation
Capitalised terms used but not defined in this Affiliate Deed shall,
unless the context otherwise requires, have the respective meanings
ascribed thereto in the Shareholders Agreement.
2. Undertakings
2.1 Transferee hereby acknowledges that it has received a copy, and has read
and understands, the Shareholders Agreement, and covenants, agrees and
confirms that it shall be bound by all provisions of the Shareholders
Agreement as if it was an original party thereto, including with respect
to the rights and obligations of the Parent contained therein, and the
Shareholders Agreement shall have full force and effect on it, and shall
be read and construed to be binding on it.
2.2 Transferee hereby further confirms that if at any time it ceases to be
an Affiliate of the Parent it shall, upon or prior to ceasing to be an
Affiliate, notify each of the Parent and the Company of such fact and
Transfer to the Parent or to any other Affiliate of the Parent
designated by the Parent, all of the Shares then held by the Transferee.
3. Governing Law
The Affiliate Deed shall be governed by and construed in accordance with
the laws of England. The terms and conditions of the Shareholders
Agreement in relation to the provisions regarding arbitration and other
terms and conditions shall be deemed to have been incorporated in this
Affiliate Deed.
Signed by:
By: [o]
Name: [o]
Title: [o]
ANNEXURE 2
UNANIMITY MATTERS
1. Amendment to the Company's Certificate of Incorporation to increase the
number of authorized shares of capital stock.
2. Appointment and removal of a President Chairman and Chief Executive
Officer.
3. Transactions relating to the sale, transfer or disposal of assets and
substantial investment in property, plant, equipment or other facilities
in excess of USD 10 million at any one time that are not part of the
yearly budget. Loans and guarantees or other security in excess of USD5
million except in the ordinary course of business.
4. Any amalgamation, merger or de-merger involving the Company other than
spinning off the interests in the diamond and base metals business
maintaining the same shareholding pattern in the spun off entity..
5. To approve: (a) the yearly budget, the business plans and the strategic
plans of the Company; and (b) expenditures that exceed the approved
yearly budget by more than 15%.
6. To approve any investment of surplus funds (excluding bank deposits or
the purchase of short-term investments) outside of the Business in an
amount exceeding 5 million in a single tranche of deployment.
7. To change auditors or appoint or change internal auditors.
8. To enter into or modify any arrangement or agreement, which provides any
special rights upon any shareholder of the Company outside of this
Agreement;
9. To commence any activity or operations which is not a part of the
Company's Business (which shall include present Northern Territory
Tenements and exploration for gold, diamonds and base metals on these
tenements) and to diversify into any new products/services other than
fertilizer business through a joint venture or otherwise.
