EXHIBIT 10.123 SALE AND PURCHASE AGREEMENT
(Xxxxxxx Camp Mine)
THIS SALE AND PURCHASE AGREEMENT is made by and among
ARIMETCO, INC., a Nevada corporation ("ARIMETCO" or "SELLER"),
whose address is 000 Xxxxx Xxxxxx Xxxx, Xxxxx 000, Xxxxxx,
Xxxxxxx 00000; and SUMMO USA CORPORATION, a Colorado corporation
("SUMMO"), whose address is 0000 Xxxxxxx Xxxxxx, Xxxxx 000,
Xxxxxx, Xxxxxxxx 00000.
RECITALS
A. ARIMETCO is the Debtor-in-Possession under Case
No. 97-00004-TUC-JMM that is pending in the United States
Bankruptcy Court for the District of Arizona (Tucson Division)
(the "Reorganization Case").
B. AmPac Mining Southwest, Inc., A Delaware corporation
("AMPAC"), was a wholly owned subsidiary of ARIMETCO and the
owner of the Xxxxxxx Camp Property (as hereinafter defined).
C. Pursuant to an order of the Bankruptcy Court in the
Reorganization Case, AMPAC has been substantively consolidated,
liquidated and dissolved into ARIMETCO, and as a consequence,
ARIMETCO is now the owner of the Xxxxxxx Camp Property.
D. Subject to Bankruptcy Court approval, SELLER desires to
sell, and SUMMO desires to purchase, the Xxxxxxx Camp Property.
NOW, THEREFORE, in consideration of the premises and the
mutual covenants and conditions contained in this Agreement, the
parties agree as follows:
I. DEFINITIONS AND CONSTRUCTION.
1.1 In addition to the capitalized terms defined above,
whenever used in this Agreement, unless another meaning is
expressly indicated, the following defined terms shall have the
meanings ascribed to them below, all of which definitions shall
be substantive terms of this Agreement:
"$" and "Dollars" mean the currency of the United States of
America.
"Affiliate" means any person, partnership, joint venture,
corporation, or other form of enterprise which directly or
indirectly controls, is controlled by, or is under common control
with, SUMMO. For purposes of the preceding sentence, "control"
means possession, directly or indirectly, of the power to direct
or cause direction of management and policies through ownership
of voting securities, contract, voting trust, or otherwise.
"Agreement" means this Sale and Purchase Agreement, which
includes and by this reference incorporates Exhibits "A" through
"L" attached to this Sale and Purchase Agreement, and all
amendments or supplements to this Sale and Purchase Agreement
that the parties may approve in writing.
"Bankruptcy Court Order" means the order of the Bankruptcy
Court in the Reorganization Case authorizing and approving the
sale of the Xxxxxxx Camp Property to SUMMO pursuant to the 363
Sale and in accordance with this Agreement.
"Books, Records, and Accounts" means the books, records, and
accounts that relate to the Xxxxxxx Camp Property and which are
more particularly described in Part 3 of Exhibit "B" attached
hereto provided, however, that any books, records and/or accounts
that are listed on Exhibit "B" which do not relate to the Xxxxxxx
Camp Property are not included in the definition of Books,
Records, and Accounts.
"Buildings and Equipment" means the buildings and equipment
located on the Mining Property that are more particularly
described in Part 1 of Exhibit "B" attached hereto.
"Business Day" means any day that is not a Saturday, Sunday,
or other day on which national banks are authorized or required
to close.
"Closing" means the consummation of the sale by SELLER and
the purchase by SUMMO of the Xxxxxxx Camp Property, as provided
in this Agreement.
"Code" means the Title 11 of the United States Code, as
amended.
"Committee" means the Official Committee of Unsecured
Creditors in the Reorganization Case.
"Confidentiality Agreement" means the Confidentiality
Agreement dated September 10, 1997, entered into by and between
ARIMETCO and SUMMO.
"Effective Date" means the date of entry of the Bankruptcy
Court Order approving the sale of the Xxxxxxx Camp Property to
SUMMO; provided, however, that no appeal of such order is filed
within the time allowed by law. If (i) the Bankruptcy Court
specifically disapproves the sale of the Xxxxxxx Camp Property to
SUMMO, or (ii) the Bankruptcy Court fails to approve the sale
within sixty (60) days after the 363 Motion has been filed, or
(iii) an appeal of the Bankruptcy Court Order is filed within the
time allowed by law and a stay pending appeal is entered before
the payment of any amount required by Section 2.5(a), then this
Agreement shall be null and void ab initio. If an appeal is
filed within the time allowed by law but no stay is entered,
SUMMO may by notice to ARIMETCO elect to proceed with its
purchase of the Xxxxxxx Camp Property and to have this Agreement
effective as of the date of the entry of the Bankruptcy Court
Order.
"Escrow Agent" means Pioneer Title Agency, Inc. of Sierra
Vista, Arizona.
"Excluded Assets" has the meaning set forth in Section 2.22
hereof and comprise those assets listed on Part 5 of Exhibit "B."
"Fee Lands" means the fee lands owned by SELLER located in
Cochise County, Arizona that are more particularly described in
Part 2 of Exhibit "A" attached hereto.
"Final Order" means an order of the Bankruptcy Court as to
which (i) any appeal that has been taken has been finally
determined or dismissed; (ii) the time for appeal has expired and
no appeal has been timely filed; or (iii) if an appeal,
reargument, certiorari, or rehearing thereof has been sought,
such order has not been stayed.
"Geological Data" means the geological, engineering, and
technical data, information, records, and maps relating to the
Xxxxxxx Camp Property that are more particularly described in
Part 4 of Exhibit "B" attached hereto.
"Inventories and Supplies" means the inventories and
supplies located on the Mining Property that are more
particularly described in Part 2 of Exhibit "B" attached hereto.
The term Inventories and Supplies shall not include cathode
copper produced by SELLER and sold to Billiton Stratcor, Inc.,
prior to the date of Closing, or any proceeds from the sale of
such cathode copper.
"Xxxxxxx Camp Property" means collectively the Mining
Property, Personal Property, and Contracts.
"Lien" means any mortgage, pledge, lien, encumbrance,
charge, or other security interest.
"Mining Property" means collectively the Fee Lands; Patented
Mining Claims; Rights-of-Way; Unpatented Mining Claims; and Water
Rights, Xxxxx, and Agreements. The term "Mining Property" shall
also include all stockpiles, xxxxx heaps, dumps, and tailings
situated on the Mining Property.
"Ordinary Course of Business" means the ordinary course of
business consistent with past custom and practice (including with
respect to quantity and frequency).
"Patented Mining Claims" means the patented mining claims
located in Cochise County, Arizona that are more particularly
described in Part 1 of Exhibit "A" attached hereto.
"Permits" means all permits, licenses, registrations,
qualifications and other approvals that have been issued by any
federal, state, tribal, or local governmental body and are in
effect at the date of this Agreement or that may be issued by any
such body on or before the Closing, and that are assignable
pursuant to applicable law, and that relate to the ownership,
construction, operation, maintenance, repair and replacement of
the Mining Property.
"Permitted Encumbrances" means those encumbrances against
the Mining Property that are identified on Exhibit "C" attached
hereto.
"Person" means an individual, a partnership, a corporation,
a limited liability company, an association, a joint stock
company, a trust, a joint venture, an unincorporated organization
and a governmental entity or any department, agency or political
subdivision thereof.
"Personal Property" means the Buildings and Equipment;
Inventories and Supplies; Books, Records, and Accounts; the
Geological Data and the Permits, as listed on Parts 1 through 4
of Exhibit "B," together with the proceeds of any insurance
thereon.
"Purchase Price" means the sum described in Section 2.5,
which shall be payable as provided in this Agreement.
"Removal Period" has the meaning set forth in Section 2.22
hereof.
"Rights-of-Way" mean the rights-of-way located in Cochise
County, Arizona that are associated with the Mining Property and
which are more particularly described in Part 4 of Exhibit "A"
attached hereto.
"Tax" means any federal, state, local, or foreign income,
gross receipts, license, payroll, employment, excise, severance,
stamp, occupation, premium, windfall profit, environmental
(including taxes under IRC Section 59A), customs duties, capital
stock, franchise, profits, withholding, social security (or
similar), unemployment, disability, real property, personal
property, sales, use, transfer, registration, value added,
alternative or add-on, minimum, estimated, or other tax of any
kind whatsoever, including any interest, penalty, or addition
thereto, whether disputed or not.
"Unpatented Mining Claims" means the unpatented mining
claims owned by SELLER that are located in Cochise County,
Arizona and which are more particularly described in Part 3 of
Exhibit "A" attached hereto.
"Water Rights, Xxxxx, and Agreements" means the water
rights, xxxxx, and agreements owned by SELLER in Cochise County,
Arizona that are associated with the Mining Property and which
are more particularly described in Part 5 of Exhibit "A" attached
hereto.
"363 Motion" means a motion to be filed by ARIMETCO in the
Reorganization Case requesting that the Bankruptcy Court
authorize, conduct, and approve a 363 Sale of the Xxxxxxx Camp
Property in accordance with the terms of this Agreement, and
which motion shall be undertaken and noticed in accordance with
the requirements of the Code.
"363 Sale" shall mean a public auction sale of the Xxxxxxx
Camp Property conducted by the Bankruptcy Court in the
Reorganization Case pursuant to Code 363(f) and pursuant to
which the court shall authorize and approve the sale of the
Xxxxxxx Camp Property to the bidder presenting the best bid as
determined by the Bankruptcy Court.
I.2 Construction. Unless the context of this Agreement
clearly requires otherwise, references to the plural include the
singular, references to the singular include the plural, and the
term "including" is not limiting. The words "hereof," "herein,"
"hereby," "hereunder," and similar terms in this Agreement refer
to this Agreement as a whole and not to any particular provision
of this Agreement. Section, subsection, clause, schedule, and
exhibit references refer to this Agreement unless otherwise
specified. Any reference in this Agreement to this Agreement
shall include all written alterations, amendments, changes,
extensions, modifications, renewals, replacements, substitutions,
and supplements, thereto and thereof, as applicable.
II. PURCHASE AND SALE OF THE XXXXXXX CAMP PROPERTY.
2.1 Transfer of the Xxxxxxx Camp Property at Closing. Upon
the terms, subject to the conditions, and in reliance upon the
representations, warranties, and covenants set forth in this
Agreement, SELLER shall sell and convey to SUMMO and SUMMO agrees
to purchase from SELLER, the Xxxxxxx Camp Property on the Closing
upon payment of the Purchase Price.
2.2 Sale of Assets. Subject to the terms and conditions
set out in this Agreement, SELLER hereby agrees to sell the
Xxxxxxx Camp Property to SUMMO pursuant to a 363 Sale for the
total purchase price of TWO MILLION NINE HUNDRED FIFTY THOUSAND
AND NO/100 DOLLARS ($2,950,000.00). As further consideration for
the purchase of the Xxxxxxx Camp Property, SUMMO shall assume the
existing environmental liabilities with respect to the Xxxxxxx
Camp Property.
2.3 Conduct of 363 Sale. The sale of the Xxxxxxx Camp
Property shall be undertaken pursuant to a 363 Motion and shall
be accomplished pursuant to the 363 Sale. Except for Permitted
Encumbrances and liabilities under Contracts being assumed and
assigned to SUMMO pursuant to the terms of this Agreement, the
Xxxxxxx Camp Property shall be sold free and clear of any and all
other Liens, interests (as used in Section 363 of the Code),
claims, or encumbrances of any type or nature, to the maximum
extent permitted by the Code. All such Liens, interests, claims
and encumbrances shall attach only to the sale proceeds with the
same priority, dignity, validity, and effect as they attached to
the Xxxxxxx Camp Property. In addition to any requirements
imposed by the Bankruptcy Code and the Bankruptcy Court for the
conduct of the 363 Sale, the 363 Sale shall be subject to the
following conditions:
(a) Public Sale. The 363 Sale shall be a public
sale at which parties other than SUMMO shall be allowed
to bid. Seller shall take the steps necessary or
appropriate as ordered by the Bankruptcy Court to
advertise the 363 Sale. All expenses of advertising
the 363 Sale shall be paid by Seller.
(b) Opening Bid. The opening bid at the 363 Sale
shall be the bid of SUMMO which shall consist of the
Purchase Price together with the terms and conditions
of the transaction as set forth in this Agreement.
(c) Right of SUMMO to Bid. Nothing contained in
this Agreement shall preclude or restrict SUMMO from
increasing the Purchase Price as part of the bidding
process at the 363 Sale.
(d) Identification of Bidders. All bidders shall
be required to identify their principals, and to
disclose to the Bankruptcy Court, SUMMO and any other
bidders whether the bidder or any of its principals are
insiders of Seller, as that term is defined in 11
U.S.C. 101(31) or have any other relationship with
Seller.
(e) Title. Title to the Xxxxxxx Camp Property
shall be conveyed pursuant to an Order entered by the
Bankruptcy Court approving the 363 Sale free and clear
of all liens, claims, interests and encumbrances
(except for Permitted Encumbrances) pursuant to 11
U.S.C. 363 and pursuant to conveyance documents which
are executed pursuant thereto.
2.4 Transfer of Rights and Obligations. If the
transactions contemplated by this Agreement are consummated in
accordance with the provisions of this Agreement, the ownership
of the Xxxxxxx Camp Property shall be transferred from SELLER to
SUMMO at the Closing. Subject only to the terms of this
Agreement, SELLER shall be entitled to all of the rights, and
shall be subject to all of the duties and obligations, of such
ownership up to and including the Closing, and SUMMO shall be
entitled to all of the rights, and shall be subject to all of the
duties and obligations, of such ownership after the Closing. In
particular, until the occurrence of the Closing, SELLER shall be
entitled to all monies payable under any contract, agreement or
lease pertaining to the Xxxxxxx Camp Property. In addition, the
sale of the Mining Property shall be subject to any contract for
the purchase and removal of waste rock from the Mining Property,
and SELLER shall be entitled to all proceeds of any such contract
for waste rock removed prior to the date of Closing, whether such
proceeds are payable before or after Closing. Any such contract
entered into after the date of execution of this Agreement shall
not extend past the date of Closing. Any such contract entered
into before the date of execution of this Agreement and which
extends past the date of Closing shall be assigned to SUMMO at
the Closing. SELLER warrants that no such contract is subject to
Section 365 of the Code. If the result of the 363 Sale is that
SUMMO is not the purchaser of the Xxxxxxx Camp Property, then
this Agreement shall terminate, and except as otherwise expressly
provided herein, neither SELLER nor SUMMO shall have any further
rights or obligations hereunder.
2.5 Payment of Purchase Price.
(a) The purchase price shall be paid as follows:
$ 90,000.00 on or before five calendar (5) days
after the date of this Agreement;
$ 30,000.00 on or before one (1) month after
the Effective Date and a like amount on
or before the same day of each month
thereafter until the date of the Closing
or the date of SUMMO's termination of
this Agreement, whichever date first
occurs;
$1,950,000.00 at Closing less all amounts
previously paid;
$1,000,000.00 out of production as more
particularly provided in Exhibit "K"
"Grant of Production Payment."
(b) If, after the payment of any amount required
by the foregoing subparagraph (a) to be paid prior to
Closing, a stay is entered in connection with an appeal
of the Bankruptcy Court Order, SUMMO may by notice to
SELLER elect to terminate this Agreement and ARIMETCO
shall thereupon refund to SUMMO all amounts previously
paid to SELLER under the foregoing subsection (a).
2.6 Employees. All persons employed by SELLER at or in
connection with the Xxxxxxx Camp Property shall remain the
employees of SELLER. SUMMO has no obligation to assume any
employment contract, collective bargaining agreement, or other
similar agreement relating to the employment of persons at or in
connection with the Xxxxxxx Camp Property. SELLER shall be
responsible for providing any required plant closing or other
similar notices to their employees. SUMMO shall have the right,
but not the obligation, to offer employment to some or all
persons presently employed at or in connection with the Xxxxxxx
Camp Property, but the terms of such employment shall be at
SUMMO's sole discretion.
2.7 Representations and Warranties of SUMMO. SUMMO
represents and warrants to SELLER as follows:
(a) That it is a corporation duly incorporated
and in good standing in its state of incorporation and
that it is qualified to do business and is in good
standing in those states where necessary in order to
carry out the purposes of this Agreement.
(b) That it has the capacity to enter into and
perform this Agreement and all transactions
contemplated herein and that all corporate and other
actions required to authorize it to enter into and
perform this Agreement have been properly taken.
(c) That it shall not breach any other agreement
or arrangement by entering into or performing this
Agreement.
(d) That this Agreement has been duly executed
and delivered by it and is valid and binding upon it in
accordance with its terms.
(e) SUMMO's acquisition of the Xxxxxxx Camp
Property pursuant to the terms of this Agreement and
all other agreements and documents necessary to
consummate this transaction is in good faith, as that
phrase is used in Code Section 363(m).
2.8 Representations and Warranties of ARIMETCO. ARIMETCO
represents and warrants to SUMMO as follows:
(a) That it is a corporation duly incorporated
and in good standing in its state of incorporation and
that it is qualified to do business and is in good
standing in those states where necessary in order to
carry out the purposes of this Agreement.
(b) In all respects material to the Xxxxxxx Camp
Property, to SELLER's knowledge and except as disclosed
on Exhibit" L," SELLER is not in default under any law
or regulation, or under any order of any court, or
federal, state, municipal, or other governmental
department, commission, board, bureau, agency, or
instrumentality and, except to the extent set forth on
Exhibit "L," there are (1) no claims, actions, suits,
or proceedings instituted or filed, or (2) to the
knowledge of SELLER, no claims, actions, suits, or
proceedings threatened presently or which in the future
may be threatened against or affecting SELLER at law or
equity, or before or by any federal, state, municipal,
or other governmental department, commission, board,
bureau, agency, or instrumentality.
(c) That, subject to Bankruptcy Court approval,
it has the capacity to enter into and perform this
Agreement and all transactions contemplated herein and
that all corporate and other actions required to
authorize it to enter into and perform this Agreement
have been properly taken.
(d) That it shall not breach any other agreement
or arrangement by entering into or performing this
Agreement.
(e) That, subject to Bankruptcy Court approval,
this Agreement has been duly executed and delivered by
it and is valid and binding upon it in accordance with
its terms.
(f) SELLER carries insurance, which it believes
to be adequate in character and amount, with reputable
insurers in respect of the Xxxxxxx Camp Property and
such insurance policies are in full force and effect.
SELLER shall, within ten (10) days after the Effective
Date, provide SUMMO with certificates of such
insurance.
2.9 Covenants of SUMMO.
(a) SUMMO shall take or cause to be taken all
actions necessary or advisable to consummate the
transactions contemplated by this Agreement and to
assure that, as of the Closing, it shall not be under
any material corporate, legal, governmental or
contractual restriction that would prohibit or delay
the timely consummation of such transactions.
2.10 Covenants of ARIMETCO.
(a) Prior to Closing, SELLER shall: (i) carry on
operations on the Mining Property as it has heretofore
and shall not introduce any material new method of
management or operation; (ii) maintain the Xxxxxxx Camp
Property in as good working order and condition as at
present, ordinary wear and tear excepted; (iii) perform
all material obligations under agreements relating to
or affecting the Xxxxxxx Camp Property; and (iv) keep
in full force and effect present insurance policies or
other comparable insurance coverage. Without limiting
the generality of the foregoing, SELLER shall maintain
the circulation of all heap xxxxx solutions in order to
prevent the build-up of such solutions and their
overflow from the pond.
(b) Prior to Closing, SELLER shall not: (i) with
respect to the Xxxxxxx Camp Property enter into any
contract or commitment (except the waste rock
contract(s) mentioned in Section 2.4) or incur or agree
to incur any liability except in the normal course of
business; (ii) create, assume, or permit to exist any
mortgage, pledge, or other lien or encumbrance upon the
Xxxxxxx Camp Property except those that already exist;
or (iii) sell, assign, lease, or otherwise transfer or
dispose of any portion of the Xxxxxxx Camp Property
except in the ordinary course of business or except
pursuant to the 363 Sale.
(c) SELLER shall take or cause to be taken all
actions necessary or advisable to consummate the
transactions contemplated by this Agreement (including
the filing and prosecution of motions under Code
Sections 363 and 365 in the Bankruptcy Case) and to
assure that as of the Closing it shall not be under any
material corporate, legal, governmental or contractual
restriction that would prohibit or delay the timely
consummation of such transactions.
2.11 Due Diligence.
(a) The parties acknowledge and agree that
SUMMO's purchase shall be based on SUMMO's independent
investigation, inspection, examination, analysis,
testing and evaluation of and pertaining to the Xxxxxxx
Camp Property and, in that regard, SUMMO acknowledges
and confirms that SELLER has not made any
representations or warranties with respect to the
nature, condition or status of the Xxxxxxx Camp
Property other than those which are set forth and
contained in this Agreement. SUMMO acknowledges the
Xxxxxxx Camp Property is being sold in "AS IS"
condition without warranty, expressed or implied except
as specifically set forth herein.
(b) Accordingly, SUMMO and its lenders shall have
up to one hundred fifty (150) days after the Effective
Date within which to conduct their due diligence
investigation of the Xxxxxxx Camp Property. During
this period, SELLER shall permit representatives of
SUMMO and its lenders to have free and unrestricted
access to the Xxxxxxx Camp Property and to all Books,
Records, and Accounts of SELLER, wherever located,
relating to the Xxxxxxx Camp Property. The
representatives of SUMMO and its lenders shall have the
right to explore, sample, and test the Mining Property
by drilling, geophysical and geochemical surveys, or
other methods; provided, however, that such due
diligence investigation shall be conducted in
accordance with all applicable laws and provided,
further, that promptly after completion of any such
activity, SUMMO shall return the Mining Property to
essentially its prior condition. SUMMO's obligation to
restore the Mining Property to its prior condition
shall continue in full force and effect and shall
survive any termination of this Agreement.
(c) SUMMO shall exercise all due diligence in
safeguarding and maintaining as confidential all data
or information acquired during its due diligence
investigation, and all such data and information shall
be subject to the Confidentiality Agreement and SUMMO
shall not disclose any such information to any person
unless such person is subject to and bound by the
Confidentiality Agreement; provided, however, that
notwithstanding any other provision, the requirement
for confidentiality shall be subject to the following
exceptions:
(i) A disclosure to (1) an entity to
which the rights of SUMMO have been assigned
pursuant to Section 3.4(a) or a nominee of
SUMMO under Section 3.4(b), including but not
limited to the lenders of such entity or
nominee; (2) any public or private financing
agency or institution or financier; (3) any
contractor or subcontractor that SUMMO (its
assignee or nominee) engages to assist it
with its due diligence; and (4) employees and
consultants of SUMMO (its assignee or
nominee) including attorneys, auditors,
bankers, and other advisors. In any such
case only such confidential information as
such third party shall have a legitimate
business need to know shall be disclosed.
Before SUMMO makes any disclosure pursuant to
this subsection (i), the third party shall
first agree in writing to protect the
confidential information from further
disclosure to the same extent as SUMMO is
obligated hereunder.
(ii) Confidential information that
otherwise comes into the public domain.
(iii) Confidential information that
is required, in the opinion of counsel for
SUMMO (its parent, assignee, or nominee), to
be disclosed to any federal, state, or local
government or appropriate agencies and
departments thereof or that is required, in
the opinion of such counsel, to be publicly
announced, to the extent required by law.
(iv) Confidential information required
to be disclosed pursuant to the rules or
regulations of a stock exchange or similar
trading market applicable to SUMMO or its
parent.
(d) SUMMO or its lenders shall bear all costs of
its due diligence investigation, including the costs of
any exploration, sampling, and testing; shall obtain
all permits required for its due diligence
investigation; and shall conduct its due diligence
investigation in a manner so as not to interfere with
the normal business operations.
(e) SUMMO waives and releases all claims against
SELLER, its directors, officers, employees, and agents
for injury to or death of persons or damage to property
caused directly or indirectly by SUMMO's due diligence
investigation except such as may result from SELLER's
negligence or willful misconduct. SUMMO shall indemnify
and hold SELLER, its directors, officers, employees,
and agents harmless from and against all claims, costs,
expenses, actions, suits, proceedings, losses, damages
and liabilities, including but not limited to
reasonable attorneys' fees and expenses, caused
directly or indirectly by SUMMO's performance of its
due diligence investigation of the Xxxxxxx Camp
Property. This release and indemnity shall continue in
full force and effect and shall survive any termination
of this Agreement and the purchase of the Xxxxxxx Camp
Property.
2.12 Closing.
(a) Subject to Bankruptcy Court approval of this
Agreement and the transactions contemplated hereby and
confirmation of the 363 Sale to SUMMO as the successful
bidder, and unless stayed by an order of the Bankruptcy
Court or appellate court having jurisdiction over this
matter, and unless the parties agree that the Closing
of the sale of the Xxxxxxx Camp Property to SUMMO shall
take place at some other time and place, the Closing
shall take place at the office of Xxxxxxx Xxxx, P.A.,
at Xxx Xxxxx Xxxxxx Xxxxxx, Xxxxx 0000, Xxxxxx, Xxxxxxx
00000, at 10:00 o'clock a.m. on the tenth (10th)
business day after the completion of the due diligence
period.
(b) The Escrow Agent shall act as closing agent
and escrow agent under this Agreement.
2.13 Conditions Precedent to Obligations of SELLER at
Closing. The obligations of SELLER to sell the Xxxxxxx Camp
Property to SUMMO at Closing are conditioned on the following all
having occurred on or before the Closing:
(a) The representations and warranties of SUMMO
contained in this Agreement shall be true and correct
in all material respects at and as of the Closing as
though then made, and SUMMO shall have performed all of
the covenants required to be performed by it pursuant
to this Agreement prior to the Closing.
(b) SUMMO shall have delivered to SELLER a
resolution authorizing the execution, delivery, and
performance of this Agreement by SUMMO, certified by
the secretary of SUMMO to have been duly adopted by the
Board of Directors of SUMMO and to be in full force and
effect as of the Effective Date.
(c) SELLER shall have obtained the Bankruptcy
Court Order and such Order shall be a Final Order.
(d) No state, federal or foreign statute, rule,
regulation or action shall exist or shall have been
adopted or taken and no judicial or administrative
decision shall have been entered (whether on a
preliminary or final basis), that would prohibit,
restrict or unreasonably delay the consummation of the
transactions contemplated by this Agreement or make
illegal the payments due under this Agreement.
(e) SUMMO shall have delivered to SELLER all of
the following items:
(i) a duly executed Assumption
Agreement substantially in the form attached
hereto as Exhibit "E";
(ii) a duly executed Non-Foreign
Affidavit substantially in the form attached
hereto as Exhibit "G";
(iii) a duly-executed Environmental
Indemnification Agreement in form and
substance satisfactory to SUMMO and SELLER;
and
(iv) the cash portion of the Purchase
Price less any amounts previously paid
pursuant to Section 2.5.
2.14 Conditions Precedent to Obligations of SUMMO at
Closing. The obligations of SUMMO at Closing are conditioned on
the following having occurred on or before the Closing:
(a) The representations of ARIMETCO contained in
this Agreement shall be true and correct in all
material respects at and as of the Closing as though
then made, and SELLER shall have performed all of the
covenants required to be performed by it pursuant to
this Agreement prior to the Closing.
(b) SELLER's title to the Mining Property shall
be good and marketable.
(c) With respect to the Xxxxxxx Camp Property,
all mining claims maintenance fees accruing prior to
the date of Closing, and all insurance premiums
accruing on or before the date of the Closing, shall
have been paid by SELLER.
(d) SELLER shall have obtained all consents
required to be obtained by SELLER to transfer the
Xxxxxxx Camp Property to SUMMO.
(e) ARIMETCO shall have delivered to SUMMO a
resolution authorizing the execution, delivery, and
performance of this Agreement by ARIMETCO, certified by
the secretary of ARIMETCO to have been duly adopted by
the Board of Directors of ARIMETCO and to be in full
force and effect as of the Effective Date.
2.15 Obligations of SELLER at Closing. At the Closing,
SELLER shall deliver to SUMMO:
(a) A special warranty deed substantially in the
form of Exhibit "I" attached hereto conveying the
Mining Property to SUMMO.
(b) A xxxx of sale substantially in the form of
Exhibit "J" attached hereto conveying the Personal
Property to SUMMO.
(c) An assignment substantially in the form of
Exhibit "E" attached hereto assigning (to the extent
that the same are assignable) the contracts to SUMMO.
(d) Certificates of Title, to the extent
available, for all vehicles or equipment included in
Personal Property, properly executed by ARIMETCO.
(e) Such other deeds or assignments, in such form
as may be appropriate, which may be necessary or
convenient to completely transfer the Xxxxxxx Camp
Property to SUMMO.
2.16 Obligations of SUMMO at Closing. At Closing, SUMMO
shall:
(a) Pay SELLER ONE MILLION NINE HUNDRED FIFTY
THOUSAND AND NO/100 DOLLARS ($1,950,000.00), less
amounts previously paid under Section 2.5, "Payment of
Purchase Price," by cashier's check or wire transfer.
Of this amount, the Escrow Agent shall retain
$375,000.00 until the completion of the inventory and
adjustment as provided in Section 2.20.
(b) Deliver to SELLER a Grant of Production
Payment substantially in the form of Exhibit "K"
attached hereto and incorporated by reference herein.
2.17 Recording Fees and Transfer Taxes. SUMMO shall pay all
recording fees and documentary transfer taxes.
2.18 Allocation of Taxes. Taxes for the current year
assessed on SELLER's interest in the Xxxxxxx Camp Property,
including severance and transaction privilege taxes, shall be pro-
rated between SELLER and SUMMO as of the date of Closing.
2.19 Utility Refunds. No agreements or contracts in
existence at the Closing relating to utility refunds, deposit
returns or otherwise are included in the transactions provided
for in this Agreement, and SUMMO shall have no right, title or
interest therein or in any monies now or hereafter due SELLER
thereunder. All refunds, credits, and discounts of any nature
received by or accruing to the benefit of SUMMO at any time after
the Closing relative to the Xxxxxxx Camp Property or any part
thereof or to any utility for any part of the Xxxxxxx Camp
Property that were earned or agreed to prior to Closing shall be
immediately remitted by SUMMO to SELLER in cash.
2.20 Post Closing Inventory. SUMMO shall have five (5)
calendar days after the date of Closing in which to inventory the
Personal Property listed on Exhibit "B." Any shortfall disclosed
by such inventory shall be compensated at the as is fair market
value (not replacement cost) of such missing items out of the
amount retained by the Escrow Agent as provided in Section
2.16(a), provided, however, that there shall be no adjustment of
the Purchase Price for any items or class of items that have a
fair market value of $1000.00 or less.
2.21 Access After Closing. At the SELLER's expense, SELLER
may retain copies of any Books, Records and Accounts. After the
Closing, SUMMO shall, at SELLER's expense and upon forty-eight
(48) hours' advance notice to SUMMO, provide SELLER and the
Committee with reasonable access to the SELLER's records acquired
by SUMMO hereunder, in connection with any reasonable business or
bankruptcy purpose of SELLER or the Committee, as the case may
be. SUMMO covenants to maintain SELLER's records for two (2)
years following the Closing.
2.22 Post-Closing Removal of Excluded Assets. All assets
located at the Mining Property that are not included in the sale
of the Xxxxxxx Camp Property to SUMMO (hereinafter the "Excluded
Assets") shall remain the property of SELLER, and SELLER shall
have up to ninety (90) days after the Closing (the "Removal
Period") to remove the Excluded Assets from the Mining Property.
In addition, at any time during the Removal Period, SELLER may
conduct at the Mining Property a public sale or sales of the
Excluded Assets. All Excluded Assets not removed within the
Removal Period shall become the property of SUMMO.
III. MISCELLANEOUS.
3.1 Termination by SUMMO. SUMMO may at any time prior to
the Closing terminate this Agreement by delivering to SELLER or
by filing for record in the appropriate office (with a copy to
SELLER) a recordable Surrender of this Agreement. Upon mailing
the Surrender to SELLER or to the appropriate office, all rights,
liabilities, and obligations of SUMMO under this Agreement shall
terminate. Upon such termination, SELLER shall retain all
amounts theretofore paid under Section 2.5, "Payment of Purchase
Price."
3.2 Termination by SELLER. If SUMMO shall fail to make any
payment when due under Section 2.5(a) within ten (10) days after
SELLER's written notice to SUMMO of such default, or if SUMMO
shall be in default of any obligation under Section 2.12(b)
regarding the conduct of its due diligence and shall fail to
initiate and diligently pursue steps to cure such default within
thirty (30) days after SELLER's written notice to SUMMO of such
default, then upon the expiration of such period SELLER may, by
written notice to SUMMO, terminate this Agreement.
Notwithstanding the foregoing, in the event of the prospect of
immediate and/or irreparable harm to the Xxxxxxx Camp Property
and/or any threat to the health, safety and/or welfare of any
person, nothing herein shall preclude SELLER from immediately
seeking and obtaining any appropriate relief or remedy from the
Bankruptcy Court in the Reorganization Case.
3.3 Notices. All notices and other communications to any
party shall be in writing and shall be sufficiently given if
(i) delivered in person; (ii) sent by electronic facsimile
communication, with confirmation sent by registered or certified
mail, return receipt requested; or (iii) sent by registered or
certified mail, return receipt requested. All notices shall be
effective and shall be deemed delivered (i) if by personal
delivery, on the date of delivery; (ii) if by electronic
facsimile communication, on the date of receipt of the
communication; and (iii) if by mail, on the date of mailing.
Until a change of address is communicated as indicated above, all
notices to ARIMETCO shall be addressed:
ARIMETCO, INC.
000 Xxxxx Xxxxxx Xxxx, Xxxxx 000
Xxxxxx, Xxxxxxx 00000
FAX: (000) 000-0000
Attn: Xxxx XxXxxxxx
and all notices to SUMMO shall be addressed:
SUMMO USA CORPORATION
0000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
FAX: (000) 000-0000
Attn: Xxxxx X. Xxxxx
3.4 Assignment; Nominee.
(a) The rights of SUMMO under this Agreement may
be assigned to an Affiliate of SUMMO; provided,
however, that any such assignment shall not release
SUMMO from any obligations and liabilities hereunder.
(b) Subject to SELLER's written consent (which
consent shall be in SELLER's sole and absolute
discretion), SUMMO may designate a nominee to take
title to the Xxxxxxx Camp Property, and in such case
the transfer documents shall name said nominee as the
transferee.
3.5 Inurement. All covenants, conditions, limitations, and
provisions contained in this Agreement apply to and are binding
upon the parties to this Agreement, their heirs, representatives,
successors, and assigns.
3.6 Force Majeure.
(a) If SUMMO or SUMMO's lender shall be prevented
by Force Majeure from timely performance of its due
diligence under Section 2.12, "Due Diligence," the
period for performance of such due diligence shall be
extended for an additional period equal to the duration
of the Force Majeure. In no event shall the total of
all such extensions exceed thirty (30) days. Upon the
occurrence and upon the termination of any Force
Majeure, SUMMO shall promptly notify SELLER. SUMMO
shall use reasonable diligence to remedy a Force
Majeure, but shall not be required against its better
judgment to settle any labor dispute or contest the
validity of any law or regulation or any action or
inaction of civil or military authority.
(b) "Force Majeure" means any cause beyond SUMMO's reasonable
control, including law or regulation; action or inaction of civil
or military authority; inability to obtain any license, permit,
or other authorization that may be required to conduct due
diligence on or in connection with the Xxxxxxx Camp Property;
unusually severe weather; fire; explosion; flood; insurrection;
riot; labor dispute; inability after diligent effort to obtain
workmen or material; delay in transportation; acts of God.
3.7 Attorneys' Fees. If arbitration or legal action is
instituted by either party to enforce the terms of this Agreement
or to recover damages for the breach of any of the provisions of
this Agreement, the prevailing party shall be entitled to receive
from the other party reasonable attorneys' fees to be determined
by the arbitrator(s) or the court in which the action is brought.
3.8 Modification. No modification, variation, or amendment
of this Agreement shall be effective unless it is in writing and
is signed by all parties to this Agreement.
3.9 Waiver. Any party to this Agreement may, in its sole
and absolute discretion, waive any term or provision of this
Agreement that is in its favor and/or for its benefit. No waiver
of any provision of this Agreement, or waiver of any breach of
this Agreement, shall be effective unless the waiver is in
writing and is signed by the party against whom the waiver is
claimed. No waiver of any breach shall be deemed to be a waiver
of any other or subsequent breach.
3.10 Entire Agreement. This Agreement sets forth the entire
agreement of the parties and supersedes all previous and
contemporaneous agreements, representations, warranties, and
undertakings, written or oral.
3.11 Construction.
(a) The paragraph headings are for convenience
only, and shall not be used in the construction of this
Agreement.
(b) The invalidity of any provision of this
Agreement shall not affect the enforceability of any
other provision of this Agreement.
(c) In the event of any conflict between this
Agreement and any Exhibit attached hereto, the terms of
this Agreement shall be controlling.
3.12 Governing Law. THE VALIDITY OF THIS AGREEMENT AND ALL
OTHER DOCUMENTS EXECUTED AND DELIVERED HEREWITH, THE
CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT HEREOF AND THEREOF,
AND THE RIGHTS OF THE PARTIES HERETO AND THERETO WITH RESPECT TO
ALL MATTERS ARISING HEREUNDER OR THEREUNDER OR RELATED HERETO OR
THERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE UNITED STATES OF AMERICA
(INCLUDING THE BANKRUPTCY CODE), IT BEING THE INTENT OF THE
PARTIES THAT FEDERAL LAW SHALL GOVERN THE RIGHTS AND DUTIES OF
THE PARTIES HERETO WITHOUT REGARD TO THE APPLICATION OF ANY
PROVISION OF STATE LAW. TO THE EXTENT THAT FEDERAL LAW WOULD
APPLY THE LAW OF ANY STATE AS THE FEDERAL RULE FOR THE PURPOSES
OF THIS AGREEMENT, THE PARTIES AGREE THAT THE LAWS OF THE STATE
OF ARIZONA SHALL BE USED TO SUPPLEMENT APPLICABLE FEDERAL LAW.
THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS
ARISING IN CONNECTION WITH THIS AGREEMENT SHALL BE TRIED AND
LITIGATED ONLY IN THE BANKRUPTCY COURT. SUMMO AND SELLER WAIVE,
TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT EACH MAY
HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT
TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE
WITH THIS SECTION 3.12.
SUMMO AND SELLER HEREBY WAIVE THEIR RESPECTIVE RIGHTS
TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR
ARISING OUT OF ANY OF THIS AGREEMENT OR ANY OF THE TRANSACTIONS
CONTEMPLATED HEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS,
BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY
CLAIMS. SUMMO AND SELLER REPRESENT THAT EACH HAS REVIEWED THIS
WAIVER AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL
RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT
OF LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN
CONSENT TO A TRIAL BY THE COURT.
3.13 Short Form. Contemporaneously herewith ARIMETCO and
SUMMO have executed and delivered a Short Form of this Agreement.
SUMMO may record the Short Form or this Agreement, or both, as it
may elect.
3.14 Additional Documents. If conditions change by reason
of acquisitions, conveyances, assignments, or other matters
relating to the title to or description of the Xxxxxxx Camp
Property, ARIMETCO and SUMMO shall execute amendments of this
Agreement, and any other documents which may be necessary to
reflect such changed conditions. After the Closing, SELLER shall
provide SUMMO with such deeds, assignments, or other additional
documents as may be necessary to carry out the purposes of this
Agreement, including any documents that may be necessary to
effect assignment of BLM Rights-of-Way, State of Arizona Rights-
of-Way, and permits, plans of operations, and other
authorizations from governmental authorities relating to the
Xxxxxxx Camp Property.
3.15 Closing Documents, Motions, and Related Matters. The
documents to be exchanged at Closing, and motions and related
papers to be filed, executed or delivered pursuant hereto shall
be subject to the reasonable approval of counsel to the
respective parties.
3.16 Press Releases. Neither party shall issue any press
release without providing the other party a copy of the proposed
release at least 24 hours prior to its issuance. Any objections
to the accuracy of such press release not made prior to the
issuance thereof shall be deemed waived.
3.17 Counterparts; Telefacsimile Execution. This Agreement
may be executed in any number of counterparts and by different
parties on separate counterparts, each of which, when executed
and delivered, shall be deemed to be an original, and all of
which, when taken together, shall constitute but one and the same
Agreement. Delivery of an executed counterpart of this Agreement
by telefacsimile shall be equally as effective as delivery of a
manually executed counterpart of this Agreement. Any party
delivering an executed counterpart of this Agreement by
telefacsimile also shall deliver a manually executed counterpart
of this Agreement but the failure to deliver a manually executed
counterpart shall not affect the validity, enforceability, and
binding effect of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the 15th day of September, 1998.
ARIMETCO, INC.,
a Nevada corporation
By: /s/ Xxxxxxx X. Xxxx By: /s/ Xxxx XxXxxxxx
Xxxxxxx X. Xxxx Xxxx XxXxxxxx
Its President Its Senior Vice President
