COMMON STOCK PURCHASE AGREEMENT
COMMON STOCK PURCHASE AGREEMENT ("Agreement") made as of this 3rd day
of December, 1997 between NORD PACIFIC LIMITED, a Bermuda corporation, with its
principal offices at 00 Xxxxxx Xxxxxx, Xxxxxxxx XX00, Xxxxxxx (xxx "Company")
and MINERAL RESOURCES DEVELOPMENT COMPANY PTY LIMITED, a Papua New Guinea
company, with an address at Pacific Place, 0xx Xxxxx, Xxx Xxxxxxxx Xxxxxx and
Champion Parade, Port Moresby, Papua New Guinea (the "Subscriber").
W I T N E S S E T H :
WHEREAS, the Subscriber desires to acquire 600,000 shares (the
"Shares") of common stock, $.05 par value per share, of the Company at US$4.50
per Share for an aggregate purchase price of $2,700,000 payable in PNG Kina
equivalent calculated at the average exchange rate quoted by the Bank of Papua
New Guinea for the two weeks prior to the date of this agreement (the "Purchase
Price").
WHEREAS, the Company is willing, subject to the terms and conditions
set forth herein, to sell the Shares to the Subscriber for the Purchase Price.
NOW, THEREFORE, for and in consideration of the premises and the
mutual covenants hereinafter set forth, the parties hereto do hereby agree as
follows:
1. SUBSCRIPTION FOR SECURITIES.
1.1 Subject to the terms and conditions hereinafter set forth,
the Subscriber hereby subscribes for and agrees to purchase the Shares from the
Company for the Purchase Price and the company agrees to sell the Shares to the
Subscriber for the Purchase Price. The Purchase Price is payable by the
Subscriber concurrent with the execution and delivery of this Agreement to the
company, by wire transfer to the escrow account set forth in Section 1.2 below.
1.2 The Purchase Price shall be paid concurrently herewith in
PNG Kina to an escrow account (the "Escrow Account") of Gadens Xxxxxxxx Lawyers
(the "Escrow Agent"), attorneys for the Company, at The Australia and New
Zealand Banking Group (PNG) Limited ("ANZ Bank"), Xxxxxx Xxxxx, Xxxxxxx Xxxxx,
Xxx Xxxxxxxx Xxxxxx and Champion Parade, Port Moresby, Account No. 364037-00.
1.3 The Subscriber recognizes that the purchase of the Shares
involves a high degree of risk in that (i) none of the Shares have been
registered under the United States Securities Act of 1933, as amended ("1933
Act"), and the Company has no obligation to register the Shares; (ii) an
investment in the Shares is highly speculative; and (iii) the Subscriber may not
be able to liquidate the Subscriber's investment.
1.4 The Subscriber understands that the offer and sale of the
Shares is being made pursuant to Regulation S promulgated under the 1933 Act
and, accordingly, the stock certificate representing the Shares will contain the
restrictive legend set forth below (the "Legend"):
THE SECURITIES COVERED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933
(THE "SECURITIES ACT") AND MAY NOT BE OFFERED OR SOLD WITHIN
THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF,
U.S. PERSONS (I) AS PART OF THE DISTRIBUTION UNDER THE
ACQUISITION AGREEMENT PURSUANT TO WHICH THIS CERTIFICATE WAS
ISSUED, AT ANY TIME, OR (II) OTHERWISE UNTIL FORTY (40) DAYS
AFTER THE DATE OF ISSUANCE OF THIS CERTIFICATE, EXCEPT IN
EITHER CASE IN ACCORDANCE WITH REGULATION S UNDER THE
SECURITIES ACT.
2. CLOSING PROCEDURES.
2.1 The following shall be the procedures for closing on the
purchase and sale of the Shares:
2.1.1 The Subscriber shall, in accordance with Section
2.1 above, wire transfer the Purchase Price into the Escrow Account.
2.1.2 The Company shall execute the irrevocable
instruction letter, the form of which is annexed hereto as EXHIBIT B, and
forward it to American Stock Transfer & Trust Company, its United States
transfer agent and registrar.
2.1.3 Upon receipt by the Escrow Agent of the original
certificate for the Shares, the Escrow Agent shall deliver the original
certificate to the Subscriber at the address set forth on the first page hereof.
Concurrently therewith, the Escrow Agent shall transfer the Purchase Price from
the Escrow Account to an account designated in writing by the Company (the
"Closing").
2.1.4 In the event the Escrow Agent does not receive the
Purchase Price by December 20, 1997, this Agreement shall terminate and neither
party shall have any further obligation or liability to the other.
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3. REPRESENTATIONS BY SUBSCRIBER.
3.1 The Subscriber represents that the Subscriber is not a
U.S. Person (as defined below), and that the Subscriber is able to bear the
economic risk of an investment in the Shares. For purposes hereof, the term
"U.S. Person" means (i) any natural person resident in the United States; (ii)
any partnership or corporation organized or incorporated under the laws of the
United States; (iii) any estate of which any executor or administrator is a U.S.
Person; (iv) any trust of which any trustee is a U.S. Person; (v) any agency or
branch of a foreign entity located in the United States; (vi) any
non-discretionary account or similar account (other than an estate or trust)
held by a dealer or other fiduciary for the benefit or account of a U.S. Person;
(vii) any discretionary account or similar account (other than an estate or
trust) held by a dealer or other fiduciary organized, incorporated, or (if an
individual) resident in the United States; and (viii) any partnership or
corporation if: (A) organized or incorporated under the laws of any foreign
jurisdiction; and (B) formed by a U.S. Person principally for the purposes of
investing in securities not registered under the 1933 Act, unless it is
organized or incorporated, and owned, by Accredited Investors (as defined in
Regulation D under the 0000 Xxx) who are not natural persons, estates or
trusts.
3.2 At the time the offer was made to the Subscriber to
purchase the Shares, the Subscriber was not in the United States of America and
at the time the Subscriber is executing this Agreement and at the time that the
Subscriber pays the Purchase Price, the Subscriber is not and will not be in the
United States of America.
3.3 During the forty (40) day period following the Closing,
the Subscriber will not offer or sell the Shares to a U.S. Person or for the
account or benefit of a U.S. Person.
3.4 The Subscriber has such knowledge and expertise in
financial and business matters that the Subscriber is capable of evaluating the
merits and risks involved in an investment in the Shares. The Subscriber
acknowledges that the Subscriber has significant prior investment experience,
including investment in non-listed and non-registered securities.
3.5 The Subscriber understands that the Shares have not been
registered under the 1933 Act and that the Shares may not be sold in the United
States of America, to a U.S. Person, or for the account or benefit of a U.S.
Person, unless the Shares are registered under the 1933 Act or an exemption from
registration is available.
3.6 The Subscriber consents to the placement of the Legend on
the certificates for the Shares during the forty (40) day period following the
Closing, indicating that the securities represented by such certificate may not
be sold in the United States of America or to a U.S. Person or for the account
or benefit of a U.S. Person.
3.7 The Subscriber represents that the Subscriber is acquiring
the Shares for its own account.
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3.8 The Subscriber represents that the address of Subscriber
furnished by Subscriber on the first page hereof is the Subscriber's principal
place of business.
3.9 The Subscriber represents that Subscriber has had a
reasonable opportunity to ask questions of and receive answers from the Company
concerning the company, and all such questions, if any, have been answered to
the full satisfaction of the Subscriber; the Subscriber has had an opportunity
to review the Company's Form 10-K for the fiscal year ended December 31, 1996,
the Company's Form 10-Q for the quarter ended September 30, 1997, a copy of such
Form 10-Q having been previously provided to Subscriber, and the Company's
Annual Report for 1996 and Proxy Statement for its Annual Meeting of
Shareholders for 1997 ("Public Documents").
3.10 The Subscriber has full power and authority to execute and
deliver this Agreement and to perform the obligations of the undersigned
hereunder; and this Agreement is a legally binding obligation of the undersigned
in accordance with its terms.
3.11 No representations or warranties have been made to the
Subscriber by the Company or any agent, employee or affiliate of the Company,
and in entering into this transaction, the Subscriber is not relying on any
information, other than that contained in this Agreement and the Public
Documents and the results of an independent investigation by the Subscriber.
4. BROKER.
4.1 Subscriber represents and warrants to the Company that it
has not dealt with any broker, finder or other party entitled to a commission in
connection with the purchase and sale of the Shares provided for by this
Agreement other xxxx Xxxxxxx Xxxxx Private (Australia) Limited of Brisbane,
Australia ("Xxxxxxx Xxxxx") and Subscriber represents and warrants that the
Company has no obligations to Xxxxxxx Xxxxx as a result of this Agreement.
Subscriber hereby agrees to indemnify, defend and hold harmless the Subscriber
against any breach of the foregoing representation by the Subscriber.
5. LISTING.
5.1 The Company shall take such steps as are necessary to make
application to list the Shares on the National Association of Securities Dealers
Automated Quotation System, National Market and the Toronto Stock Exchange.
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6. PUBLIC ANNOUNCEMENT.
6.1 The parties hereto agree to coordinate the release of
public information relating to this Agreement and, except as otherwise required
by applicable law, rule or regulation, will not release any information without
the prior written consent of the other party hereto.
7. REGARDING THE ESCROW AGENT.
7.1 In the event that a dispute shall arise as to the
disposition of the funds in the Escrow Account or any other funds held hereunder
in escrow, Escrow Agent shall have the right, at its option, to either hold the
same or deposit the same with a court of competent jurisdiction pending decision
of such court, and Escrow Agent shall be entitled to rely upon the decision of
such court.
7.2 Escrow Agent shall have no liability whatsoever arising
out of or in connection with its activity as Escrow Agent provided it does not
act in bad faith and the Company and Subscriber jointly and severally agree to
indemnify and hold harmless Escrow Agent from all loss, cost, claim, damage,
liability and expense (including attorney's fees) which may be incurred by
reason of its acting as Escrow Agent unless caused by Escrow Agent's bad faith.
7.3 Any notice, demand or other communication to Escrow Agent
hereunder shall be in writing and delivered to Gadens Xxxxxxxx Lawyers, 00xx
Xxxxx, Xxxxxxx Xxxxx, Xxx Xxxxxxxx Xxxxxx and Champion Parade, Port Moresby,
Papua New Guinea.
7.4 Notwithstanding any dispute concerning the funds in the
Escrow Account or this Agreement, Escrow Agent may represent the Company as the
Company's legal counsel.
8. MISCELLANEOUS.
8.1 All notices, consents and other communications under this
Agreement shall be in writing and shall be deemed to have been duly given (a)
when delivered by hand, or (b) three (3) business days after the business day
of deposit with the carrier, if sent for next business day delivery by an
internationally recognized overnight delivery service (e.g., DHL, Federal
Express).
8.2 This Agreement shall not be changed, modified or amended
except by a writing signed by the parties to be charged, and this Agreement may
not be discharged except by performance in accordance with its terms or by a
writing signed by the party to be charged.
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8.3 This Agreement shall be binding upon and inure to the
benefit of the parties hereto and to their respective legal representatives,
successors and assigns. This Agreement sets forth the entire agreement and
understanding between the parties as to the subject matter thereof and merges
and supersedes all prior discussions, agreements and understandings of any and
every nature among them.
8.4 Notwithstanding the place where this Agreement may be
executed by any of the parties hereto, the parties expressly agree that all the
terms and provisions hereof shall be construed in accordance with and governed
by the laws of the State of New York, United States of America. The parties
hereby agree that any dispute which may arise between them arising out of or in
connection with this Agreement shall be adjudicated before a court located in
New York and they hereby submit to the exclusive jurisdiction of the courts of
the State of New York and of the federal courts in New York with respect to any
action or legal proceeding commenced by any party, and irrevocably waive any
objection they now or hereafter may have respecting the venue of any such action
or proceeding brought in such a court or respecting the fact that such court is
an inconvenient forum, relating to or arising out of this Agreement or any acts
or omissions relating to the sale of the securities hereunder, and consent to
the service of process in any such action or legal proceeding by means of
registered or certified mail, return receipt requested, in case of the address
set forth below or such other address as the undersigned shall furnish in
writing to the other.
8.5 This Agreement may be executed in counterparts. Upon the
execution and delivery of this Agreement by the Subscriber, this Agreement shall
become a binding obligation of the Subscriber with respect to the purchase of
the Shares as herein provided.
8.6 The holding of any provision of this Agreement to be
invalid or unenforceable by a court of competent jurisdiction shall not affect
any other provision of this Agreement, which shall remain in full force and
effect.
8.7 It is agreed that a waiver by either party of a breach of
any provision of this Agreement shall not operate, or be construed, as a waiver
of any subsequent breach by that same party.
8.8 The parties agree to execute and deliver all such further
documents, agreements and instruments and take such other and further action as
may be necessary or appropriate to carry out the purposes and intent of this
Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first written above.
TO BE COMPLETED BY SUBSCRIBER:
For and on behalf of MINERAL RESOURCES DEVELOPMENT COMPANY
PTY LIMITED by its authorized officer XXX XXXX:
/s/ Xxx Xxxx
------------
Managing Director
/s/ Xxxxx Xxxx
--------------
Signature of Witness
Name and Address of Witness:
Xxxxx Xxxx
----------
Manager-Commercial
------------------
MRDC
----
SUBSCRIPTION ACCEPTED:
NORD PACIFIC LIMITED
By: /s/ Xxxx Xxxxx
---------------
Xxxx Xxxxx
Vice President Development
Date: December 3, 1997
/s/ Xxxx Xxxxxxxxxxx
--------------------
Signature of Witness
Name and Address of Witness:
Xxxx Xxxxxxxxxxx
000 Xxxxxxxxx Xxxx
Xxxxxxxxxx XXX 0000
Xxxxxxxxx
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EXHIBIT B
NORD PACIFIC LIMITED
00 XXXXXX XXXXXX
XXXXXXXX XX00
December __, 1997
American Stock Transfer & Trust Company
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
RE: NORD PACIFIC LIMITED (THE "COMPANY")
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Ladies and Gentlemen:
Concurrently herewith, Mineral Resources Development Company Pty Limited, a
Papua New Guinea company ("Purchaser"), with an address at Pacific Place, 0xx
Xxxxx, Xxx Xxxxxxxx Xxxxxx and Champion Parade, Port Moresby, Papua, New Guinea,
is acquiring from the Company, 600,000 shares (the "Shares") of common stock,
$.05 par value per share, in a placement pursuant to Regulation S of the United
States Securities Act of 1933, as amended. In connection therewith, you are
instructed to issue to Purchaser a certificate for the Shares. The certificate
for the Shares should be delivered by hand to our attorneys, Xxxxxxx & Xxxxxxx
P.C., 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000. The certificate for the
Shares should contain the restrictive legend set forth on EXHIBIT A annexed
hereto.
These instructions are irrevocable.
Very truly yours,
NORD PACIFIC LIMITED
By:
------------------------------------
X. Xxxxxx Xxxxxx, President
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EXHIBIT A
THE SECURITIES COVERED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933
(THE "SECURITIES ACT") AND MAY NOT BE OFFERED OR SOLD WITHIN
THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF,
U.S. PERSONS (I) AS PART OF THE DISTRIBUTION UNDER THE
ACQUISITION AGREEMENT PURSUANT TO WHICH THIS CERTIFICATE WAS
ISSUED, AT ANY TIME, OR (II) OTHERWISE UNTIL FORTY (40) DAYS
AFTER THE DATE OF ISSUANCE OF THIS CERTIFICATE, EXCEPT IN
EITHER CASE IN ACCORDANCE WITH REGULATION S UNDER THE
SECURITIES ACT.
