THIRD AMENDMENT TO
ACQUISITION AGREEMENT AND
AGREEMENT AND PLAN OF MERGER
THIS THIRD AMENDMENT TO ACQUISITION AGREEMENT AND AGREEMENT AND PLAN OF
MERGER (this "Amendment") is dated as of December 30, 2004, and entered into by
and among KINROSS GOLD CORPORATION, a corporation existing under the laws of the
Province of Ontario, Canada ("Parent"), CROWN MERGER CORPORATION, a Washington
corporation and a wholly-owned subsidiary of Parent ("Purchaser"), and CROWN
RESOURCES CORPORATION, a Washington corporation ("Crown," and together with
Purchaser, the "Constituent Corporations").
A. Parent, Purchaser, and Crown are parties to the Acquisition
Agreement and Agreement and Plan of Merger, dated November 20, 2003, as
previously amended April 7, 2004 and September 15, 2004 (the "Acquisition
Agreement"), pursuant to which Purchaser will merge with and into Crown and
Crown will become a wholly-owned subsidiary of Parent. The parties wish to amend
the Acquisition Agreement as set forth herein. Defined terms contained in this
Amendment shall have the meaning ascribed to them in the Acquisition Agreement.
B. This Amendment is entered into in conformance with Section 9.4
of the Acquisition Agreement which requires that any modification of the
Acquisition Agreement be set forth in writing and signed by all parties.
C. Concurrently with this Amendment, Parent proposes to purchase
common stock of Crown as provided in a Stock Purchase Agreement substantially in
the form attached hereto as Exhibit A. Certain of the changes in this Amendment
are made in contemplation of such purchase.
D. In light of the unanticipated delay in implementation of the
Merger, the parties wish to confirm certain matters relating to the
satisfaction, to date, of certain conditions to the obligation of Parent and
Purchaser to consummate the Merger
NOW, THEREFORE, in consideration of the mutual agreements contained in
this Amendment, and for other good and valuable consideration, the value,
receipt and sufficiency of which are acknowledged, the parties agree as follows:
1. AMENDMENT TO SECTION 1.7.1. Section 1.7.1 is amended to read, in
its entirety, as follows:
CONVERSION OF CROWN COMMON STOCK. Each share of Crown Common Stock
(other than Crown Common Stock held by Parent or Purchaser or by a
Dissenter) issued and outstanding immediately prior to the Effective
Time will be converted into the right to receive 0.2911 Kinross Common
Shares (the "Exchange Ratio"). All outstanding shares of Crown Common
Stock as of the Effective Time will automatically be cancelled and
will cease to exist. The certificates formerly representing shares of
Crown Common Stock to be converted into Kinross Common Shares as
described above (each a "Certificate" and, collectively, the
"Certificates") will thereafter represent that number of Kinross Common
Shares determined by the Exchange Ratio. Such certificates held by
Dissenters shall represent the right to pursue such rights as the
Dissenter may have under the Washington Act. Such certificates held by
Parent or Purchaser shall be cancelled and retired and shall cease to
exist and no Kinross Common Shares or other consideration shall be
delivered in exchange therefor.
2. AMENDMENT TO SECTION 8.1.2.1. Section 8.1.2.1 is amended by
replacing the date "December 31, 2004" that currently appears in the Acquisition
Agreement, with the date "May 31, 2005."
3. AMENDMENT TO SECTION 7.1. The introductory paragraph of Section
7.1 is amended by deleting therefrom the language "pursuant to SECTION 7.5".
4. CONFIRMATION AND WAIVER. Pursuant to the introductory paragraph
of Section 7.3, Parent and Purchaser:
(a) waive the conditions expressed in Sections 7.3.5, 7.3.7 and
7.3.8; and
(b) waive the conditions expressed in Sections 7.3.2 and 7.3.3
insofar as such conditions apply as a consequence of an act, event or
condition, of which Parent and Purchaser are currently aware, that
occurred prior to or that exists as of the date of this Amendment.
Parent, Purchaser and Crown represent and warrant as of the date of this
Amendment that they are not aware of any condition in Section 7.3.2 or 7.3.3
that would constitute, individually or in the aggregate a Material Adverse
Effect on the business, properties or prospects of Crown.
5. CONSENT TO SALE OF STOCK. For the purpose of Section 5.1 of the
Acquisition Agreement, Parent consents to the sale of Crown Common Stock as
described in Exhibit A.
6. RATIFICATION OF ACQUISITION AGREEMENT. Except as specifically
provided in Sections 1 through 5 hereof, the parties specifically ratify,
confirm, and adopt as binding and enforceable, all of the terms and conditions
of the Acquisition Agreement.
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IN WITNESS WHEREOF, Parent, Purchaser, and Crown have caused this
Amendment to be signed as of the date first written above by their respective
officers or representatives thereunto duly authorized.
Parent:
KINROSS GOLD CORPORATION
By
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Xxxx-Xxxx Xxxxxxxxx, Duly Authorized
Officer
Purchaser:
CROWN MERGER CORPORATION
By
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Xxxx-Xxxx Xxxxxxxxx, Director
Crown:
CROWN RESOURCES CORPORATION
By
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Xxxxxxxxxxx Herald, President and CEO
SIGNATURE PAGE TO THIRD AMENDMENT TO ACQUISITION AGREEMENT AND
AGREEMENT AND PLAN OF MERGER
CROWN RESOURCES CORPORATION
STOCK PURCHASE AGREEMENT
This agreement is dated as of December 30, 2004 and is by and between
CROWN RESOURCES CORPORATION, a Washington corporation, ("Crown") and KINROSS
GOLD CORPORATION, a corporation existing under the laws of the Province of
Ontario, Canada ("Kinross"). Crown and Kinross are parties to an Acquisition
Agreement and Agreement and Plan of Merger, dated November 20, 2003, as
previously amended April 7, 2004 and September 15, 2004, (the "Merger
Agreement") pursuant to which a subsidiary of Kinross will merge with and into
Crown and Crown will become a wholly-owned subsidiary of Kinross (the "Merger").
As a result of delays in the implementation of the Merger, Crown has incurred
costs, and expects to continue to incur costs, relating to permitting of its
principal property ("Permitting Activities") that it would have incurred as a
subsidiary of Kinross had the Merger been consummated on the anticipated
schedule. It is currently anticipated that the Merger will be consummated on or
before May 31, 2005. In order to provide Crown with the funds required to
continue Permitting Activities as scheduled, Crown has agreed to sell to Kinross
and Kinross has agreed to purchase from Crown, in each case upon the terms and
subject to the conditions set forth below, newly issued shares of Crown Common
Stock.
NOW, THEREFORE, the parties agree as follows:
1. PURCHASE OF CROWN COMMON STOCK. Crown agrees to sell to Kinross
and Kinross agrees to purchase from Crown 511,640 newly issued shares of Crown
Common Stock (the "Shares"). The purchase price for the Shares is US$1 million,
payable in cash by wire transfer against delivery of a certificate representing
the Shares. The purchase price has been calculated based on the average closing
price of the Crown Common Stock, as reported by NASDAQ, for the twenty trading
days immediately preceding the date of this Agreement. The purchase of the
Shares shall be consummated on or before January 17, 2005.
2. REPRESENTATIONS, WARRANTIES AND COVENANTS OF CROWN. Crown
represents, warrants and covenants to Kinross as follows:
2.1 ORGANIZATION AND STANDING. Crown is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Washington.
2.2 AUTHORIZATION AND BINDING OBLIGATION. Crown has the necessary
corporate power and authority to enter into and perform this Agreement and to
issue and sell the Shares to Kinross. Crown's execution, delivery and
performance of this Agreement has been duly and validly authorized by all
necessary action on its part. This Agreement has been duly executed and
delivered by Crown and constitutes the legal, valid and binding obligation of
Crown, enforceable against Crown in accordance with its terms, except as
enforceability thereof may be limited by applicable bankruptcy, insolvency,
moratorium or similar laws affecting creditors' rights generally and by the
exercise of judicial discretion in accordance with equitable principles.
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2.3 ABSENCE OF CONFLICTING AGREEMENTS OR REQUIRED CONSENTS. The
execution, delivery and performance of this Agreement by Crown will not violate
any pre-emptive or other contractual or statutory right of any other person
enforceable against Crown and no consent of any person is required as a
condition of Crown's performance under this Agreement.
2.4 BROKERAGE. Crown has not entered into any agreements for
brokerage commissions, finders' fees or similar compensation in connection with
the sale of the Shares.
2.5 USE OF PROCEEDS. Crown intends to use the proceeds from the
issuance of Shares under this Agreement ("Proceeds") to pay governmental fees,
consultant fees and other third party costs incurred with respect to Permitting
Activities. Crown will not: (a) pay any Proceeds, directly or indirectly, to any
shareholder or warrant holder of Crown; or (b) apply the Proceeds to pay any
indebtedness of Crown with respect to which any Crown shareholder or warrant
holder is liable or a guarantor.
2.6 ACCOUNTING FOR USE OF PROCEEDS. Crown will maintain records
adequate to demonstrate that the Proceeds and assets of the Account were used in
the manner permitted by Section 2.5, and will provide copies of such records to
Kinross at Kinross' request.
3. REPRESENTATIONS AND WARRANTIES OF KINROSS. Kinross represents
and warrants to Crown as follows:
3.1 ORGANIZATION AND STANDING. Kinross is a corporation duly
organized, validly existing and in good standing under the laws of the Province
of Ontario, Canada.
3.2 AUTHORIZATION AND BINDING OBLIGATION. Kinross has the necessary
corporate power and authority to enter into and perform this Agreement and to
purchase the Shares from Crown. Kinross' execution, delivery and performance of
this Agreement has been duly and validly authorized by all necessary action on
its part. This Agreement has been duly executed and delivered by Kinross and
constitutes the legal, valid and binding obligation of Kinross, enforceable
against Kinross in accordance with its terms, except as enforceability thereof
may be limited by applicable bankruptcy, insolvency, moratorium or similar laws
affecting creditors' rights generally and by the exercise of judicial discretion
in accordance with equitable principles.
3.3 ABSENCE OF CONFLICTING AGREEMENTS OR REQUIRED CONSENTS. The
execution, delivery and performance of this Agreement by Kinross will not
violate any pre-emptive or other contractual or statutory right of any other
person enforceable against Kinross and no consent of any person is required as a
condition of Kinross' performance under this Agreement.
3.4 BROKERAGE. Kinross has not entered into any agreements for
brokerage commissions, finders' fees or similar compensation in connection with
the sale of the Shares.
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3.5 PURCHASE FOR OWN ACCOUNT. Kinross is purchasing the Shares for
investment for its own account and not with a view to distribution or resale.
3.6 KNOWLEDGE AND EXPERIENCE Kinross has such knowledge and
experience in financial and business matters that it is capable of evaluating
the merits and risks of an investment in the Shares and is able to bear the
economic risks of an investment in the Shares for an indefinite period of time.
3.7 RECEIPT OF INFORMATION. Kinross has met with officers of Crown,
has had an opportunity to ask questions and receive answers concerning Crown and
the terms and conditions of an investment in Crown, and has received all
information that it believes is necessary or desirable in connection with an
investment in the Shares.
3.8 ACKNOWLEDGEMENT OF RESTRICTION. Kinross understands that the
Shares will be "restricted stock" under applicable United States securities
laws, that, as such, the Shares may not be resold in any transaction to which
United States securities laws apply except pursuant to registration or an
applicable exemption therefrom, and that a legend to that affect will be placed
on the certificate representing the Shares.
3.9 NO INCONSISTENT REPRESENTATIONS OR WARRANTIES. Kinross
acknowledges that no representative of Crown has, in contemplation of Kinross'
purchase of the Shares, made any representations or warranties with respect to
the value or performance of Crown or that are inconsistent with the statements
in this Agreement.
4. GOVERNING LAW. This Agreement is governed by and to be construed
in accordance with the laws of Washington, without regard to conflict of law
principles.
5. COUNTERPARTS. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original, but all of which shall
constitute one instrument.
6. ENTIRE AGREEMENT; MODIFICATIONS. This Agreement, constitutes the
entire understanding of the parties hereto with respect to the issuance and sale
of the Shares and no amendment, modification or alteration will be binding
unless the same is in writing signed by the party against whom any such
amendment, modification or alteration is sought to be enforced.
IN WITNESS WHEREOF, the parties have executed this Subscription Agreement.
KINROSS GOLD CORPORATION CROWN RESOURCES CORPORATION
By:___________________________ By:____________________________
Xxxx-Xxxx Xxxxxxxxx, Xxxxxxxxxxx Herald,
Executive Vice President President and CEO
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