Exhibit 17
EXCHANGE AGREEMENT
EXCHANGE AGREEMENT (this "Agreement") made as of the date set forth on the
signature page hereof between Atlas Corporation, a Delaware corporation (the
"Company"), and the undersigned (the "Holder").
W I T N E S S E T H :
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WHEREAS, on November 10, 1995, the Company issued US$10,000,000
principal amount of its 7% Exchangeable Debentures due October 25, 2000 (the "7%
Debentures") pursuant to an indenture of even date (the "Indenture") between the
Company and The Chase Manhattan Bank (formerly known as Chemical Bank) as
trustee (the "Trustee"), secured by a pledge of 8,474,576 (since reduced to
approximately 8,313,076) shares (such reduced number of pledged shares, as
further reduced by virtue of any subsequent exchanges of 7% Debentures in
accordance with the terms of the 7% Debentures, hereinafter referred to as the
"Pledged Shares") of common stock, no par value per share ("Vista Shares") of
Vista Gold Corp. (as successor by merger to Granges Inc.) under the Indenture
and an escrow and pledge agreement of even date (the "Escrow and Pledge
Agreement") between the Company and the Trustee, as trustee and as escrow agent;
WHEREAS, the Company and Yorkton Securities, Inc. ("Yorkton"),
representing the holders of all 7% Debentures, have negotiated terms with
respect to a repurchase of the 7% Debentures by the Company;
WHEREAS, the Holder holds the principal amount of the 7% Debentures
indicated on the signature page hereof (the "Debentures"); and
WHEREAS, on the terms and conditions set forth herein, the Holder
desires to sell to the Company and the Company desires to purchase from the
Holder the Debentures.
NOW, THEREFORE, in consideration of the premises and the mutual
representations and covenants hereinafter set forth, the Company and the Holder
do hereby agree as follows:
I. SALE OF DEBENTURES AND REPRESENTATIONS BY HOLDER
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1.1 Sale of Debentures. (a) Subject to the terms and conditions
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hereinafter set forth, the Holder hereby irrevocably agrees to sell the
Debentures to the Company and waive payment of any interest accrued and unpaid
as of the Closing (as hereinafter defined) in return for (i) a number of Pledged
Shares equal to the product of (A) the number of Pledged Shares and (B) a
fraction, the numerator of which is the principal amount of the Debentures and
the denominator of which is the principal amount of all outstanding 7%
Debentures at the time of the Closing;
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and (ii) 153 shares of common stock, US$1.00 par value per share, of the Company
(the "Atlas Shares") for each US$1,000 principal amount of the Debentures (the
securities specified in clauses (i) and (ii) above being collectively referred
to herein as the "Securities"). In lieu of fractional shares resulting from the
above computations, the Company will make a cash payment equal to the value of
such fractional shares based upon the closing price of the Atlas Shares on the
New York Stock Exchange and of the Vista Shares on the American Stock Exchange
two business days prior to the Closing (as hereinafter defined).
(b) The Holder has delivered certificates representing the Debentures
to Yorkton herewith. The Holder agrees that the certificates representing the
Securities and cash in respect of fractional shares shall be delivered (with
appropriate instruments of transfer endorsed in blank or, in the case of the
Atlas Shares, registered in the name indicated on the signature page hereto) to
Yorkton, as agent for the Holder, at the Closing (as hereinafter defined). The
Holder agrees that the Company will have no further obligation after making such
delivery to Yorkton, as agent for the Holder, and that Yorkton will thenceforth
be responsible for delivery of the Securities to the Holder.
1.2 Investor Status. The Holder makes the representations and warranties
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indicated by checkmark below:
____ (a) The Holder represents that: (i) the Holder was not offered
the Securities in the United States of America, its territories
or possessions, any state of the United States or the District of
Columbia (the "United States"),
(ii) the Holder is currently, and has been at all times when
the Securities were offered, outside the United States,
(iii) the Holder is not a U.S. Person (as hereinafter
defined),
The term "U.S. Person" means:
(1) any natural person resident in the United States;
(2) any partnership or corporation organized or incorporated under the
laws of the United States;
(3) any estate of which any executor or administrator is a U.S.
person;
(4) any trust of which any trustee is a U.S. Person;
(5) any agency or branch of a foreign entity located in the United
States;
(6) 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;
(7) 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
(8) any partnership or corporation if:
Page 8 of 17 Pages
(i) organized or incorporated under the laws of any foreign
jurisdiction; and
(ii) formed by a U.S. person principally for the purpose of
investing in securities not registered under the Securities
Act of 1933 (the "Act"), unless it is organized or
incorporated, and owned, by accredited investors (as defined
in Rule 501(a) under the Act) who are not natural persons,
estates or trusts.
Notwithstanding the foregoing definition of "U.S. Person":
(1) any discretionary account or similar account (other than an estate
or trust) held for the benefit or account of a non-U.S. person by
a dealer or other professional fiduciary organized, incorporated,
or (if an individual) resident in the United States shall not be
deemed a U.S. person;
(2) any estate of which any professional fiduciary acting as executor
or administrator is a U.S. person shall not be deemed a U.S.
person if:
(i) an executor or administrator of the estate who is not a U.S.
person has sole or shared investment discretion with respect
to the assets of the estate; and
(ii) the estate is governed by foreign law;
(3) any trust of which any professional fiduciary acting as trustee is
a U.S. person shall not be deemed a U.S. person if a trustee who
is not a U.S. person has sole or shared investment discretion with
respect to the trust assets, and no beneficiary of the trust (and
no settlor if the trust is revocable) is a U.S. person;
(4) an employee benefit plan established and administered in
accordance with the law of a country other than the United States
and customary practices and documentation of such country shall
not be deemed a U.S. person;
(5) any agency or branch of a U.S. person located outside the United
States shall not be deemed a U.S. person if:
(i) the agency or branch operates for valid business reasons; and
(ii) the agency or branch is engaged in the business of insurance
or banking and is subject to substantive insurance or banking
regulation, respectively, in the jurisdiction where located;
(6) the International Monetary Fund, the International Bank for
Reconstruction and Development, the Inter-American Development
Bank, the Asian Development Bank, the African Development Bank,
the United Nations, and their agencies, affiliates and pension
plans shall not be deemed U.S. Persons.
(iv) If the Holder is a resident of Ontario, the Holder
acknowledges that it has been provided with access to substantially the same
information concerning the Company that a prospectus filed under the Securities
Act [Ontario] would provide and is an investor who, by virtue of net worth and
investment experience or by virtue of consultation with or advice
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from a person or company who is not a promoter of the Company and who is a
registered adviser or registered dealer, is able to evaluate this investment on
the basis of such information respecting the investment presented by the
Company.
____ (b) (i) The holder represents that it is (A) a U.S. Person or
inside the United States and (B) is an "accredited investor" (as
hereinafter defined).
The term "accredited investor" means any of the following:
(1) any organization described in Section 501(c)(3) of the Internal
Revenue Code, corporation, Massachusetts or similar business trust, or
partnership, not formed for the specific purposes of acquiring the
Securities, with total assets in excess of US$5,000,000;
(2) any bank as defined in Section 3(a)(2) of the Act, or any savings
and loan association or other institution as defined in Section
3(a)(5)(A) of the Act whether acting in its individual or fiduciary
capacity; any broker or dealer registered pursuant to Section 15 of
the Securities Exchange Act of 1934 (the "1934 Act"); any insurance
company as defined in Section 2(13) of the Act; any investment company
registered under the Investment Company Act of 1940 or a business
development company as defined in Section 2(a)(48) of that act; any
Small Business Investment Company licensed by the U.S. Small Business
Administration under Section 301(c) or (d) of the Small Business
Investment Act of 1958; any plan established and maintained by a state
of the United States, such state's political subdivisions, or any
agency or instrumentality of a state of the United States or such
state's political subdivisions for the benefit of its employees, if
such plan has total assets in excess of US$5,000,000; any employee
benefit plan within the meaning of the Employee Retirement Income
Security Act of 1974 if the investment decision is made by a plan
fiduciary, as defined in Section 3(21) of such act, which is either a
bank, savings and loan association, insurance company, or registered
investment adviser, or if the employee benefit plan has total assets
in excess of US$5,000,000 or, if a self-directed plan, with investment
decisions made solely by persons that are accredited investors;
(3) any private business development company as defined in Section
202(a)(22) of the Investment Advisers Act of 1940;
(4) any natural person whose individual net worth, or joint net worth
with that person's spouse, at the time of his purchase exceeds
US$1,000,000;
(5) any natural person who had an individual income in excess of
US$200,000 in each of the two most recent years or joint income with
that person's spouse in excess of US$300,000 in each of those years
and has a reasonable expectation
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of reaching the same income level in the current year;
(6) Any trust, with total assets in excess of US$5,000,000, not formed
for the specific purpose of acquiring the Securities, whose purchase
is directed by a person who, either alone or with his purchaser
representative(s) has such knowledge and experience in financial and
business matters that he is capable of evaluating the merits and risks
of an investment in the Securities; or
(7) any entity in which all of the equity owners are accredited
investors.
(ii) The Holder hereby represents that the Holder is acquiring
the Securities for the Holder's own account for investment and not with a view
toward the resale or distribution to others.
(iii) The Holder hereby represents that it is not an affiliate
(as hereinafter defined) of Vista Gold Corp. and has not been such an affiliate
during the preceding three months. For the purposes of the preceding sentence,
the term "affiliate" shall mean a person that directly, or indirectly through
one or more intermediaries, controls, or is controlled by, or is under common
control with, Vista Gold Corp.
The Holder is a "Reg S Purchaser" if it checks subsection (a) above and is a
"Reg D Purchaser" if it checks subsection (b) above.
1.3 (a) The Holder acknowledges that the Securities have not been
registered under the Act and may not be offered or sold in the United States
unless so registered or if an exemption from such registration is available.
The Holder further acknowledges that the Company is under no obligation to
register any of the Securities under the Act or any state securities or "blue
sky" laws. The Holder agrees to hold the Company and its directors, officers,
employees, controlling persons and agents (including Yorkton and its officers,
directors, employees, counsel, controlling persons and agents) and their
respective heirs, representatives, successors and assigns harmless and to
indemnify them against all liabilities, costs and expenses incurred by them as a
result of, (i) any misrepresentation made by the Holder contained in this
Agreement, (ii) any sale or distribution by the Holder in violation of the Act
or any applicable state securities or "blue sky" laws or (iii) any untrue
statement of a material fact made by the Holder and contained herein.
(b) If the Holder is a "Reg D Purchaser", the Holder consents to the
placement of a legend on any certificate or other document evidencing the Atlas
Shares that such securities have not been registered under the Act or any state
securities or "blue sky" laws and setting forth or referring to the restrictions
on transferability and sale thereof contained in this Agreement.
The Company and the Holder anticipate that Vista Gold Corp. will permit the
removal
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of all restrictive legends on the Vista Shares upon the acquisition thereof by a
Reg D Purchaser pursuant to the terms hereof, and will allow the Vista Shares to
be resold by a Reg D Purchaser without registration under the Act pursuant to
Rule 144(k) under the Act without any holding period or volume restrictions
provided that any such sales are made in accordance with Rule 144(f) in
"brokers' transactions" (as defined in the Act) or directly with a "market
maker" (as defined in the Securities Exchange Act of 1934, as amended) and
further provided that, at the time of such sales, such Holder is not an
"affiliate" (as defined in Rule 144) of Vista Gold Corp. and has not been an
affiliate in the preceding three months (a "144(k) sale").
The Company notes that Rule 144 under the Act would currently allow resales
of Atlas Shares by Reg D Purchasers without registration under the Act after one
year, subject to volume and certain other restrictions or after two years in a
144(k) sale.
(c) If the Holder is a "Reg S Purchaser", the Holder consents to the
placement of a legend, for so long as required by law, on any certificate or
other document evidencing the Atlas Shares as required by Regulation S under the
Act. The Company will remove any such legends 40 days after issuance unless, in
the opinion of counsel to the Company, such legends must be retained by virtue
of a change of applicable law.
The Company and the Holder intend that the Vista Shares being transferred
to the Holder will be transferred to each Reg S Purchaser pursuant to Rule 904
of Regulation S under the Act and, accordingly, it is anticipated that Vista
Gold Corp. will permit the removal of all restrictive legends on the Vista
Shares upon the acquisition thereof by a Reg S Purchaser pursuant to the terms
hereof, and will allow the Vista Shares to be resold by a Reg S Purchaser
without registration under the Act pursuant to Rule 904 under the Act.
(d) The Holder is aware that the Company will make a notation in its
appropriate records with respect to the restrictions on the transferability of
the Atlas Shares and will refuse to register any transfers of Atlas Shares not
made in accordance with the Act.
1.4 The Holder represents that (i) the Holder was contacted regarding the
offer of the Securities by Yorkton (or an authorized agent or representative
thereof with whom the Holder had a prior substantial pre-existing relationship)
and (ii) no Securities were offered or sold to it by means of any form of
general solicitation or general advertising, and in connection therewith the
Holder did not: (A) receive or review any advertisement, article, notice or
other communication published in a newspaper or magazine or similar media or
broadcast over television or radio, whether closed circuit or generally
available, in connection with the sale of Securities by the Company or (B)
attend any seminar meeting or industry investor conference whose attendees were
invited by any general solicitation or general advertising.
1.5 (a) The Holder hereby acknowledges and represents that (i) the Holder
has prior investment experience, including investment in unregistered
securities, or the Holder has employed the services of an investment advisor,
attorney and/or accountant experienced in evaluating such investments to read
all of the documents furnished or made available by the
Page 12 of 17 Pages
Company to the Holder and to evaluate the merits and risks of such an investment
on the Holder's behalf; and (ii) the Holder is able to bear the economic risk
which the Holder hereby assumes.
(b) To the extent necessary, the Holder has retained, at the expense
of the Holder, and relied upon appropriate professional advice regarding the
investment, tax and legal merits and consequences of this Agreement, its sale of
the Debentures and its purchase of the Securities hereunder.
1.6 The Holder represents that the Holder has full power and authority
(corporate, statutory and otherwise) to execute and deliver this Agreement, to
sell the Debentures and to purchase the Securities. This Agreement constitutes
the legal, valid and binding obligation of the Holder, enforceable against the
Holder in accordance with its terms.
1.7 No Conflict, Governmental and Other Consents. The execution and
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delivery by the Holder of this Agreement and the consummation of the
transactions contemplated hereby will not result in the violation of any law,
statute, rule, regulation, order, writ, injunction, judgment or decree of any
court or governmental authority to or by which the Holder is bound, or of any
provision of the constitutive documents of the Holder.
1.8 The Holder owns the Debentures free and clear of any claim or lien of
any nature whatsoever and has not transferred or assigned any rights in or to
the Debentures including, without limitation, any pledge, option, warrant or
puts and will deliver the Debentures free and clear of any such claims or liens.
1.9 The Holder acknowledges that upon Closing Yorkton will receive a
commission from the Company of 2.5% of the principal amount of the Debentures,
payable in cash and shares of the Company.
II. REPRESENTATIONS BY AND COVENANTS OF THE COMPANY
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The Company hereby represents and warrants to the Holder that:
2.1 Organization and Good Standing and Qualification. The Company is a
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corporation duly organized, validly existing and in good standing under the laws
of the state of Delaware.
2.2 Securities Validly Issued, Fully Paid and Nonassessable. The Atlas
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Shares have been duly and validly authorized and, when issued and paid for
pursuant to this Agreement, will be validly issued, fully paid and
nonassessable. The Vista Shares are, to the Company's best knowledge, validly
issued, fully paid and nonassessable.
2.3 Authorization, Enforceability. The Company has all corporate right,
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power and authority to enter into this Agreement and to consummate the
transactions contemplated hereby. All corporate action on the part of the
Company, its directors and stockholders necessary for the
Page 13 of 17 Pages
authorization, execution, delivery and performance of this Agreement by the
Company, the authorization, sale, issuance and delivery of the Securities
contemplated hereby and the performance of the Company's obligations hereunder
has been taken. This Agreement, when countersigned by the Company, will be duly
executed and delivered by the Company and constitute a legal, valid and binding
obligation of the Company, enforceable against the Company in accordance with
its terms.
2.4 No Conflict, Governmental and Other Consents. The execution and
--------------------------------------------
delivery by the Company of this Agreement and the consummation of the
transactions contemplated hereby will not result in the violation of any law,
statute, rule, regulation, order, writ, injunction, judgment or decree of any
court or governmental authority to or by which the Company is bound, or of any
provision of the Certificate of Incorporation or Bylaws of the Company.
III. TERMS OF SALE
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3.1 Closing. On or about June 15, 1997, or such other date as agreed upon
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between the Company and Yorkton but in no event later than July 4, 1997, the
Company will deliver the Securities to Yorkton and Yorkton will deliver the
Debentures to the Company (the "Closing"). The Company shall have no obligation
to deliver the Securities or to proceed to Closing unless the holders 80% in
principal amount of outstanding 7% Debentures enter into identical Agreements
with the Company. Notwithstanding the foregoing two sentences, the Company may,
in its sole discretion, proceed to Closing and deliver the Securities and this
Agreement shall be valid and binding in all respects as between the Company and
the Holder.
If Vista Gold Corp. does not provide its transfer agent an opinion of
counsel with respect to removal of legends on the Vista Shares as contemplated
by Section 1.3 hereof, the Holder may elect not to close, provided, however,
that if holders of more than 20% in principal amount of outstanding 7%
Debentures so elect, the Company may elect not to close with any other holder,
including the Holder.
3.2 Amendment of Indenture and Escrow and Pledge Agreement. (a) The
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Holder hereby consents to and approves any number of supplemental indentures
pursuant to Section 802 of the Indenture, and any number of supplements or
amendments to the Escrow and Pledge Agreement pursuant to Section 17 thereof,
necessary or convenient to evidence this Agreement (including Section ? hereof)
and accomplish the transactions contemplated hereby. The Holder acknowledges
that the Company intends to discharge the Debentures and the Indenture as soon
as practicable after the Closing and that such supplements and amendments will
be formalized and reduced to writing only if the Company, the Trustee or their
respective counsels consider it necessary or advisable in order to discharge the
Debentures and the Indenture. Such supplements and amendments shall be deemed
to have been made and entered into and shall be binding upon the Holder, its
successors and assigns, regardless of whether so formalized or reduced to
writing and regardless of whether holders of a majority in principal amount of
outstanding 7% Debenture delivers similar consents and approvals to the Company.
Page 14 of 17 Pages
IV. MISCELLANEOUS
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4.1 Any notice or other communication given hereunder shall be deemed
sufficient if in writing and sent by registered or certified mail, return
receipt requested, or delivered by hand against written receipt therefor,
addressed to the Company at 000 Xxxxxxxxxxx Xxxxxx, xxxxx 0000, Xxxxxx, Xxxxxxxx
00000, Attention: Senior Vice President, Legal Affairs, and to the Holder at the
Holder's address indicated on the signature page of this Agreement. Notices
shall be deemed to have been given or delivered on the date of mailing, except
notices of change of address, which shall be deemed to have been given or
delivered when received.
4.2 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.
4.3 This Agreement shall be binding upon and inure to the benefit of the
parties hereto and to their respective heirs, legal representatives, successors
and assigns. This Agreement sets forth the entire agreement and understanding
between the parties as to the subject matter hereof and merges and supersedes
all prior discussions, agreements and understandings of any and every nature
among them.
4.4 Upon the execution and delivery of this Agreement by the Holder, this
Agreement shall become a binding obligation of the Holder with respect to the
purchase of the Securities as herein provided.
4.5 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 WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW. IN
THE EVENT THAT A JUDICIAL PROCEEDING IS NECESSARY, THE SOLE FORUM FOR RESOLVING
DISPUTES ARISING OUT OF OR RELATING TO THIS AGREEMENT IS THE SUPREME COURT OF
THE STATE OF NEW YORK IN AND FOR THE COUNTY OF NEW YORK OR THE FEDERAL COURTS
FOR SUCH STATE AND COUNTY, AND RELATED APPELLATE COURTS. THE PARTIES HEREBY
IRREVOCABLY CONSENT TO THE JURISDICTION OF SUCH COURTS AND AGREE TO SAID VENUE.
4.6 In order to discourage frivolous claims the parties agree that unless
a claimant in any proceeding arising out of this Agreement succeeds in
establishing his claim and recovering a judgment against another party
(regardless of whether such claimant succeeds against one of the other parties
to the action), then the other party shall be entitled to recover from such
claimant all of its reasonable legal costs and expenses relating to such
proceeding or incurred in preparation therefor.
4.7 The holding of any provision of this Agreement to be invalid or
unenforceable by
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a court of competent jurisdiction shall not affect any other provision of this
Agreement, which shall remain in full force and effect. If any provision of this
Agreement shall be declared by a court of competent jurisdiction to be invalid,
illegal or incapable of being enforced in whole or in part, such provision shall
be interpreted so as to remain enforceable to the maximum extent permissible
consistent with applicable law and the remaining conditions and provisions or
portions thereof shall nevertheless remain in full force and effect and
enforceable to the extent they are valid, legal and enforceable, and no
provisions shall be deemed dependent upon any other covenant or provision unless
so expressed herein.
4.8 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.
4.9 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.
4.10 This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which shall together constitute
one and the same instrument.
4.11 The Holder represents and warrants that it has not engaged, consented
to nor authorized any broker, finder or intermediary to act on its behalf,
directly or indirectly, as a broker, finder or intermediary in connection with
the transactions contemplated by this Agreement. The Holder hereby agrees to
indemnify and hold harmless the Company from and against all fees, commissions
or other payments owing to any such person or firm acting on behalf of such
Holder hereunder.
4.12 Nothing in this Agreement shall create or be deemed to create any
rights in any person or entity not a party to this Agreement.
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[Signature Page]
---------------------------------
Signature
---------------------------------
Name Typed or Printed
---------------------------------
Entity Name
---------------------------------
Address
---------------------------------
City, State and Zip Code
Principal amount of 7% Debentures __________.
Name in which Securities should be issued:____________________________________
____________________________________
____________________________________
____________________________________
This Exchange Agreement is agreed to and accepted as of ____________, 1997.
ATLAS CORPORATION
By: __________________________________________________
Name:
Title:
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