EXHIBIT C
AMENDMENT NO. 1 TO SECURITIES PURCHASE AGREEMENT
This Amendment No. 1 To Securities Purchase Agreement ("Amendment") is
entered into as of this 30th day of June 1999 by and between GLOBAL DIAMOND
RESOURCES, INC., a Nevada corporation (the "Company"), and NEW DIAMOND
CORPORATION LIMITED, a British Virgin Islands company (the "Purchaser").
RECITALS
A. The Company and the Purchaser have previously entered into
that certain Securities Purchase Agreement (the "Agreement") dated December 29,
1998.
B. Subsequent to the close of the investment set forth in the
Agreement, the Company advised the Purchaser that it paid a finder's fee
("Finder's Fee") consisting of $1,363,200 in cash and 2,750,000 shares of the
common stock, $.0005 par value per share, of the Company ("Common Stock") to Xx.
Xxx Xxxx Bin Xxx Xx-Xxxxxx Mood ("Xxx Xxxx") for services he purported to render
in connection with the investments in the Company by the Purchaser and LIWA
Diamond Company Limited ("LIWA").
C. Pursuant to the request of the Company, the Purchaser
and LIWA, Xx. Xxx Xxxx has returned to the Company approximately $963,200 of
the cash portion of the Finder's Fee (before deducting $60,000 of the
expenses paid by the Company from such amount incurred in connection with the
recovery of the Finder's Fee) and all 2,750,000 shares of Common Stock. The
Company is pursuing the return of the $400,000 balance of the cash portion of
the Finder's Fee (the "Remaining Cash Portion"). It is uncertain whether Xx.
Xxx Xxxx will return any portion of the Remaining Cash Portion to the
Company. However, as of this date, the Company has received written notice
from International PCM Holdings Limited ("PCM") that Xx. Xxx Xxxx has
instructed the London branch of United Bank of Kuwait to transfer to the
Company a deposit ("Deposit") under the control of Xx. Xxx Xxxx that the
Company is advised (i) will mature in April 2000, and (ii) has a maximum
maturity value of $250,000.
D. In expectation that Xx. Xxx Xxxx may not return the
Remaining Cash Portion, the Company and the Purchaser wish to enter into this
Amendment for purposes of revising the purchase price paid by the Purchaser
under the Agreement through the Company's issuance of an additional 666,667
shares of Common Stock (the "Additional Shares") to the Purchaser.
A G R E E M E N T
It is agreed as follows:
1. AMENDMENT OF AGREEMENT. Section 1.1 of the Agreement shall
be deleted in its entirety and replaced with the following:
"1.1 PURCHASE AND SALE OF SHARES. Subject to the terms and
conditions set forth herein, the Company agrees to sell and issue to
Purchaser, and Purchaser agrees to purchase from the Company, 9,238,096
("Shares") of Common Stock, at a purchase price of US$.3247422 per share."
Except as specifically stated otherwise herein, all other provisions
of the Agreement shall be unaffected by this Amendment and shall remain in
full force and effect. The Company shall deliver a stock certificate (in
definitive form and registered in the name of the Purchaser) representing the
Additional Shares to Ajmal Xxxxxxx Xxxxxx, at his office (Purchaser's
designated representative), no later than three (3) business days from the
date of this Agreement.
2. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE COMPANY.
As a material inducement to the Purchaser to enter into this
Amendment, the Company represents, warrants and covenants as follows:
2.1 RECITALS. The Recitals to this Agreement are true and
correct in all material respects.
2.2 CAPITALIZATION. The authorized capital stock of the
Company consists of 10,000,000 shares of Preferred Stock, $.001 par value, of
which no shares are issued, and 100,000,000 shares of Common Stock, $.0005
par value, of which 44,915,063 shares are issued and outstanding as of the
date hereof. (The number of issued and outstanding shares of Common Stock
gives effect to the recent cancellation of 2,750,000 shares of Common Stock
by Xx. Xxx Xxxx as referred to in the Recitals and the recent cancellation of
3,616,651 shares of Common Stock by XX Xxxxx, but does not give effect to the
issuance of the Additional Shares hereunder or the contemplated issuance
concurrent herewith of 666,667 shares of Common Stock each to LIWA and PCM.)
2.3 VALIDITY OF TRANSACTIONS. This Amendment, and the
performance of the transactions contemplated herein, has been duly
authorized, executed and delivered by the Company and is the valid and
legally binding obligation of the Company, enforceable in accordance with its
terms, except as limited by applicable bankruptcy, insolvency reorganization
and moratorium laws and other laws affecting enforcement of creditor's rights
generally and by general principles of equity. Subject to the consent to
this Amendment by New Diamond and PCM, the Additional Shares issuable
hereunder, when issued in accordance with the terms of this Amendment, will
be duly authorized, validly
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issued, fully paid and nonassessable. The Additional Shares will be free of any
liens or encumbrances, except for any restrictions imposed by federal or state
securities laws.
2.4 NO VIOLATION. The execution, delivery and performance of
this Amendment has been duly authorized by the Board of Directors of the Company
and the Company has taken all necessary corporate action in connection with the
execution, delivery and performance of this Amendment. The execution, delivery
and performance of this Amendment will not violate any law or any order of any
court or government agency applicable to the Company, as amended, or the
Articles of Incorporation or Bylaws of the Company, as amended, and will not
result in any breach of or default under, or, except as expressly provided
herein, result in the creation of any encumbrance upon any of the assets of the
Company pursuant to the terms of the PCM Agreement (as such term is defined in
Section 2.i(i) of the Agreement), or any other agreement or instrument by which
the Company or any of its assets may be bound. No approval of or filing with
any governmental authority (including any governmental authority in South
Africa) is required for the Company to enter into, execute or perform this
Amendment.
3. ADDITIONAL UNDERSTANDINGS AND AGREEMENTS.
A. In furtherance of the resolutions adopted by the Board
of Directors of the Company at its meeting held on May 25, 1999, the Company
agrees to pay upon demand the actual legal fees, costs and other expenses
incurred by the Purchaser and the Purchaser's counsel, Mr. Ajmal Xxxxxxx
Xxxxxx and Xxxxxx & Xxxxxx, relating to the Finder's Fee, such meeting, this
Amendment and all matters relating thereto. Such expenses shall include,
without limitation, travel expenses and the cost of preparing and filing with
the Securities and Exchange Commission all reports relating to the issuance
of the Additional Shares or the current ownership by Purchaser of the total
Shares). Such amounts shall be paid to the Purchaser as reimbursement, or
directly to the law firm or vendor, as directed by Purchaser or as the
Company deems appropriate. Concurrently with the execution of this
Agreement, the Company is paying Sidley & Austin an aggregate of $30,398.91,
consisting of (i) $15,398.91 payable in accordance with the invoice dated
June 24, 1999, and (ii) $15,000 paid on account of services rendered (and to
be rendered) and expenses invoiced from and after June 1, 1999.
B. In the event Xx. Xxx Xxxx reimburses the Company for the
Remaining Cash Portion that is not a part of the Deposit or the proceeds of
the Deposit, or any portion thereof (I.E., up to $150,000), within twelve
(12) months from the date of this Amendment, the Purchaser shall, at its
option (i) return to the Company for cancellation shares of Common Stock at
the rate of one (1) share of Common Stock for each $0.60 of the Remaining
Cash Portion paid to the Company by Xx. Xxx Xxxx, or (ii) pay the Company
$0.20 for each share of Common Stock otherwise required hereby to be returned
for cancellation. The Purchaser shall either return the shares of Common
Stock for cancellation of make the required cash payment no later than thirty
(30) days after receiving written notice from the Company that its has
received a reimbursement of the Remaining Cash Portion front Xx. Xxx Xxxx.
Notwithstanding the foregoing, no cancellation of shares or cash payments
shall be required of the Purchaser if the amount of the reimbursement by Xx.
Xxx Xxxx is less than $25,000, but in such case any cancellation of shares or
cash payment that would otherwise be required then to be made shall be
carried forward and shall be made at the time of and together with the next
subsequent reimbursement, which together with any reimbursement so carried
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forward, would equal or exceed $25,000. In the event that the Company delivers
to the Purchaser evidence, which evidence is satisfactory to the Purchaser in
its reasonable discretion, of the Company's irrevocable receipt of the Deposit
(or any specified portion thereof), the Purchaser shall return for cancellation,
and the Company shall redeem from the Purchaser, without the payment of any
consideration and without the Purchaser having any purchase right, shares of
Common Stock at the rate of one (1) share of Common Stock for each $0.60 of the
Deposit so received by the Company.
C. Subject to and conditioned upon the Company's issuance
of the Additional Shares to the Purchaser in accordance with the terms and
conditions of this Amendment, the Purchaser hereby releases, acquits and
forever discharges the Company and its Privies from any and all claims,
demands, actions, causes of action, damages, costs, or other claims
whatsoever in law or equity, which the Purchaser may have against the Company
and any of its Privies pertaining to, relating to, connected with, or arising
out of the Company's payment of or failure to disclose the Finder's Fee. As
used in this Amendment, the term "Privies" refers to the Company's agents,
assigns, attorneys, directors, employees, executors, heirs, insurers,
officers, predecessors, reinsurers, subsidiaries, and successors; provided,
however, the term Privies shall not include Xx. Xxx Xxxx.
D. The Purchaser acknowledges that the Company intends to
enter into an agreement with LIWA on the same terms and conditions as this
Amendment for purposes of issuing LIWA an additional 666,667 shares of Common
Stock ("LIWA Additional Shares") pursuant to that certain Securities Purchase
Agreement dated December 29, 1998 between the Company and LIWA. The Purchaser
also acknowledges that the Company intends to enter into an agreement with PCM
in the form of agreement attached hereto as Exhibit A for purposes of issuing
to PCM 666,667 shares of Common Stock ("PCM Shares") on the terms and conditions
set forth in Exhibit A. The Purchaser hereby waives any rights of notice or
participation with respect to the Company's issuance of the LIWA Additional
Shares or the PCM Shares afforded the Purchaser under Section 6.3 of the
Agreement.
4. MISCELLANEOUS. The parties agree that the miscellaneous
provisions of Section 8 of the Agreement shall apply to this Amendment and shall
be incorporated herein by this reference, with the exception of the first
paragraph of Section 8.2 of the Agreement which shall not apply inasmuch as the
matters provided for therein are already contemplated by Section 3A of this
Amendment.
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IN WITNESS WHEREOF, the parties have executed this Amendment as of
the day and year first written above.
GLOBAL DIAMOND RESOURCES, INC.
a Nevada corporation
By: /s/ Xxxxxx xx Xxxxxxxx
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Xxxxxx xx Xxxxxxxx,
Chief Executive Officer
NEW DIAMOND CORPORATION LIMITED.
a British Virgin Islands company
By: /s/ Xxxxx X. Basodan
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Xxxxx X. Basodan,
An authorized officer
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